e recession. in fact, it's been pointed out repeatedly that if the recovery under obama tracked with the recovery under reagan there would be millions more working and families would be making thousands of dollars more than they are today. getting back to the question for a moment, how much in tax increases is the administration proposing? >> the americans have been more optistic today than they have since the beginning of the financial crisis. >> you cannot speak for them. i cannot speak for them. they can speak for themselves. >> in a range of polls and others -- >> people have their own experiences. you are not going to change

people's opinion. they have their own experiences with this economy good or bad, and i suggest you stop digging once you're in a hole of that size. my question of you is how much business taxes are included in this budget. >> so what our budget does on taxes we propose a fully paid for set of middle class tax cuts that is paid for in the way that i discussed before. >> with business tax increases? >> actually i want doesn't include any business tax increases. >> what are the taxes? i notice you're planning a massive increase for capital gains tax, nearly doubling the capital gains tax rate from the beginning of this administration. >> all we're doing is proposing to take it back to what it was under reagan. >> are you proposing to take the income tax rate back down to

where it was under reagan? >> we are propose inging a comprehensive, revenue-neutral business tax reform. we're proposing to fully offset the tax cuts for 44 million middle class families average $600 drars ewith the capital gains tax. >> here's the problem -- >> in addition to that, we have about $640 billion of deficit reduction that we would do through other changes to high income tax areas. >> but that doesn't acount for the fact that this administration first ran that debt through the roof, to trillion dollar levels, year after year. that's like a high-priced store doubling its prices and then boasting about its half off sale.

when you tax something, you get less of it. when you tax investment you get less investment. at exactly the time we need more to create the real jobs and the higher-paying jobs that this stag nant economy desperately needs. my time, mr. donovan. the other point i'd like to address was a point raised by the ranking member when he talked about european austerity which was a combination of major tax increases and spending cuts. those european nations that emphasize spending cuts did quite well. those that emphasized tax increases have done quite peer e poorly. reagan and clinton cut spending as a percentage of gdp and the economy blossoms. >> and we have cut spending significantly in this budget. it fully pays for the

discretionary -- >> you've cut spending, yet it keeps going up and up. >> thank you, mr. chair. thank you, mr. donovan for your hard work and that of your agency. can we put up a slide on discussion their caps in the president's budget? there was a suggestion earlier on that somehow the pet's budget increases nondefense spending and at a much higher rate. but sbt it true that it's both exactly the same isle mount. >> that's exactly right. and my point is the way we look at the budget is compared to what would happen under current law. and what we're proposing is dollar-for-dollar increases compared to sequestration and what would happen in the years after that. that's right. >> thank you. the reason i asked that question is i've served on active duty. and my second question is is

there anything in the budget related to base closures do mesically? >> so we are calling for a bipartisan effort to create another b.r.a.c. commission that would look for potential in the savings department successfully to make some hard decisions about where we locate our armed forces. >> thank you. and then my third question is dynamic scoring. so on the third day, i don't think this is a part san issue. as you know, the concept is we should take into account governmental changes and both democrats and republicans have supported the research and development tax credit because studies show that if you invest in r&d, you generate economic

activity and eventually, that could pay for the credit itself. i think what makes rule change incredibly partisan is republicans only apply it to large tax expenditures and they ignore spending, nondiscretionary spending. does it make any sense to apply dynamic scoring to one part of the budget but not the rest of it? >> i think you've raised a very good point. whether it's an infrastructure, the investments in education that they can have effects on growth just as changes in the tax code can. but i would also say we have serious concerns about dynamic

scoring because of the enormous uncertainty that it has. >> so that leads to my last point. the republicans have altered the playing field. we can't change this world. there is going to be dynamic scoring on large tax expenditures. but numbers do matter. so my question to you and really to many academic think tank or nonprofit that's paying attention, can we build the capacity now to start doing dynamic scoring on pending? otherwise, my fear is going into these budget battles with one hand tied blind our backs. republicans say hey, for our priorities, we're going to apply dynamic scoring. and all we can say on the democratic side is we know infrastructure creates growth. we know investing in education is the right thing to do and we have no numbers to support that. can you, even though you're not the krerks eo, but can your agency do dynamic scoring?

or can you start building the capacity to do that so that we can also start general rating these dynamic scoring ranges even though they may not be precise? >> the problem is there 1 so much uncertainty. when cbo looked at a 10% across the board tax cut, there were analyses ranged by 15 times. and, from positive to neg tifr. so literally, they said this 10 pbt could shrink the economy orr it could be 15 times the range of expected. that's the problem whether or on the discretionary side or the tax side, the uncertainty means that it isn't really good scoring practice to build this into the official score. >> i see. i just need to say republicans

can say we need to have dynamic scoring. i wanted to say the same for education and infrastructure. >> the gentleman will be pleased to know that our rule acome dates both spending and revenue. the gentle lady from tennessee is recognized. >> mr. donovan, good to see you again. we appreciate that you are here. there's one promise i'd love to see the president make and i'd like for him to keep this one. he got caught saying if you like your doctor, you can keep him. but i'd love for him to look at the american people and say if you like your money, you can keep it. ale e and really do something about it. you know, i've got a lot of constituents in tennessee. they look at what we're doing here. there's been a lot of talk about

this budget because it is a big one. and they really feel like it's basically immoral for the federal government to look at them and say we're going to force you to live below your means so you can pay your taxes over here to a federal government that refuses to live within its means: and that's how they approach this. they want to have to send less. let me ask you a couple of questions. do you support balancing the budget within 10 years. >> we support making sure we meet the most important tests -- >> no, that's not the question. the question is do you support balancing the budget within ten years. yes or no? >> yes eagain, we think -- >> i will take that as a no. let me ask you this do you

think president clinton made a mistake in working with congressionals to balance the budget. >> i think what we're proposing is that we work there a bipartisan way to build on the cess we've had in murray ryan, to increase discretionary spending but more than offset it, as our budget does, with reductions on the mandatory side and with revenues. >> but it doesn't come into balance? >> again the budget produces -- >> let me ask you this. talking about that deficit. deficit under 3% of gdp may be a substantial improvemented. we will agree with that. when you look at the amount of sppd e spending that took place early in this administration, but it will still add to the national debt will it not? >> our budget reduces spending

overall. >> the debt is still growing. >> and it reduces the deaf sit -- >> we're still at $18 trillion and growing in debt. your estimate is $22 trillion by 2025. that would be the amount of debt. are you okay with that number? do you think that's healthy for the economy and the american taxpayer? >> the key test is compared to current law where our debt and deficits would continue to grow as a share of our economy this budget brings them below 3% of gdp on the deficit side and stabilizes and reduces the debt as a share of our economy. >> are you okay with the $22 trillion number by 20235? >> what i think the focus of a budget needs to be is are we investing in american families? in our economy? those are the most critical tests of a budget. >> sir -- >> along with the fiscal sustainability. >> i appreciate that.

but the focus of the budget should be about the american priorities that the people set. it is a reflection of the priorities of the entity. now, we have gone from $10.6 trillion in debt to over $18 trillion in debt over the last six years. the american people are saying to us and rightfully so that we have to get this under control. you can look at wha is happening with our publicly trading debt and who owns that debt. it has become a national security risk. so what my constituents want to know is how do we bring this budget into balance? how do we do that without raising faxes? how do we begin to whittle down this debt? and are you all willing to work with us to bring this occurrences about? >> what this budget does is kmaktly what you said we focus

on the american people. and we reduce middle class taxes 44 million families would get a tax cut aver ranging $600. and we invest in the things that help kids go to college. >> would that be like paying less in health insurance and now they're paying more? they're paying more in out-of-pocket cost and if obamacare expenses continue to go up and up. we have serious concerns about that and i yield back my time. >> the gentle man from massachusetts is recognized for five minutes. >> thank you very much, mr. chairman. thank you. >> i wanted to first of all give you an opportunity to respond to a comment that was made earlier and you didn't have a chance to respond which is about consumer confidence. and the implication was that your vision of consumer confidence is not actually the people's view of consumer confidence. could you just comment on that for a minute please?

>> if you look at many different measures of the people's view of the economy right now, it's been different since the financial crisis started. the job picture that we've seen substantial improvement. the thing that they want to see get better is neethey want their wages to grow. that is the key focus of middle class economics. that's what this budget focuses on. it helps their paychecks go parteder in the short run by helping their kids go to college and save for retiremented. and it helps create the jobs of the future and make sure that families are ready to take those jobs with training and other investments. >> director are those surveys of politicians? or surveys of real american workers?

those are all surveys of american people. >> thank you very much. is it accurate to say that the debt has increased over both parties over the past 15 years? >> thaekt. r are are that's correct. that is correct. yes. >> so as a result, i think that over this period, we've seen interest payments increase under leadership from both sides of the aisle. can you -- is that something you'd agree with, as well? >> yes. what effects did the unfunded war have under president bush have on today? >> the cost of what we typically call overseas contingency operations or coco contributed to

what we thought were very, very high historical deficits. and one of the important steps that we've made and the president talked to the state of the union about we had 180,000 troops overseas. we're now down to 15,000: the human costs of war obviously, were enormous. but on the fiscal side, what we've seen is our overseas contingency operations costs come down by about $130 billion a year. what e what we propose is to continue that trend into next year. we have the real opportunity to make sure that we are reaping savings there and reinvesting it into the key things we need to do in our defense department. >> now, those costs don't go away when the troops come home. i was at if v.the v.a. this morning in fact, waiting in long lines.

and it's clear that these war costs are going to go on. now, under the cuts last year that paid for by doubling the sequester cuts to nondefense programs, if that budget were to be put into effect what impact would it have for veterans programs? >> i think you raise an excellent point. we tend to talk about defense and non-defense cost in discretionary. but lit's remember in that nondefense all of the veteran's addministrations costs all of the cost in protecting our homeland in the department of homeland security, all of those are part of the so called "non-defense" part of discretionary. this is one of the reasons why it's so critical that we maintain this linkage between reversing sequestration on the defense side and on the non-defense side. >> thank you.

gentleman from south carolina, mr. rice, is recognized for five minutes. >> thank you, sir. thank you for being here today. the release of the prior testimony, the way i understand it, in this budget we have increased taxes and new government taxes or increased government programs are designed to give middle class families another $600 a year, right? i've heard you saying? >> those are the tax cuts that we're proposing. we have about a hundred cultsts reductions p e in spending in programs. >> the design is to give middle class families $600 a year, right? >> there's obviously much more than that that's focused on growing the wages of american families. >> before we make new promises and new government programs, you know,we've got medicare and social security designed to fail or be dramatically reduced in about 15 years mplt and we've got social security disability

that's going to fail unless we do something next year. shouldn't we make good the promtss that we've made before before we make new promises now for more government programs and more benefits and more give aways? shouldn't we do that? >> absolutely that. 's why our budget proposes a simple reallocation of the payroll tax. it's been done many times -- >> or the disability. but it doesn't fix social security in the long run. it doesn't fix medicare in the long run. >> as i talked about earlier immigration reform is actually a very important piece of -- >> but they don't bring them into balance. they never fix it, right? yes or no. >> they would cig nif kantdly extend the life of the trust funds. >> thank you, sir. the hitle of title of this budget is middle class economics. that 1 interesting to me. would you agree with me that the best way to lift people out of

poverty and expand the middle class, would that be government programs or expanding the economy. >> i think expanding the economy is a ski goal. i think smart, targeted investmenteds in certain govrt programs can help to accomplish that goal. >> you know this chart is a -- is cbo's forecast of gdp growth. and what they projected two years ago was 2.9%. and, as a result of the recent economics, they dropped their forecast to 2.5%. and this was over the next ten years, our projection was over the next 10 years. they dropped it 2.5% last year and 2.3% this year. we've had six years of repeated tax increases, increased government programs increased government regulations and dodd-frank and this is a result of that. next slide or going back to the first slide.

this is a graph of middle class income in blue, or aver rang household income. and you can see it's dropped about 8.7, almost 9% since 2007. at the same time graphed against that is fuels and utility costs. war on coal, epa regulations middle class regulations, it looks like there's a little discourse. next slide, please. this is their income graph against food and beverages. energy costs and food costs. they can see it every day at the grocery store. next slide please: >> this is their income against health care costs. i hear you saying the rate of health care cost is slowing. but that's what they've actually experienced. and all of these things are from the federal reserve. now, the president loves to

say he's for the middle class. the fact is i don't just listen to what he says, i look at what he does. the fact is he's gutting the middle class isn't he? i guess i'd have to disagree with you there, congressman. create more middle class jobs, grow wages. and we've seen wages to begin to increase too slowly. but i'm glad we agree that -- >> the fact is the policies aren't working. and let me ask you this what do you think the effect is on middle class income is going to be adding another, what? 4 million undocumented workers

to the work forest? how do you think that's going to affect the middle class wages? >> don't take my information. cbo shows it will grow our economy, increase productivity productivity -- >> over 20 years -- >> the gentleman's time is expired. the gentle lady from new mexico is reck newsed for five minutes. >> i'm actually going to repeat a couple things because i think they bear repeating. the country's gdp is growing at the fastest pace in many years, the stock market is at all-time highs, up employment rate is lower than it was before the financial crisis. so we have had economic growth. but the -- since the recession. and it's clear, i think my colleagues are agreeing, that it hasn't benefits everyone equally.

income inequality is in many areas, wages have been stagnant and many working families are still struggling. the median wealth has grown to nearly 7 times the median wealth of middle income families. and 70 times that of bottom earners. the highest wealth gap on record. the top 1% of earners have accumulated more wealth than the entire bottom 90% of the entire u.s. mopulation. accounting for inflation, the typical middle class household is earning less than it was before the recession. in fact the middle class are earning less than they did in 1989. i'm concerned about those poverty rates and wage rates and i'm going to talk to you in a moment about what's really occurring in many states including in my state in new mexico. this greemt is about whether we've invested effectively and enough in middle class economics.

and so i want to point out and high light that the budget does that very effectively. that we have failed to invest in infrastructure. that we've failed to invest in middle class familyies and in wage earners and in workers. if anybody wants to really see what the sequester has done, come to new mexico, which, arguably, has one of the worst economies in the country where just cutting and across-the-board cuts related to -- i think about a marriage where one spouse racks up the credit cards divorces the other spouse and often in american cow e culture, it's the wife who's left paying back those credit cards. and i'm feeling in this enviernt, like that wife in that relationship, in a severed relationship. so we disagree about how we got here. but i am agreeing that we have a way to move forward. and i want to be more specific about that. as the president's budget attempts to address this by investing in middle class priorities including access to high quality education providing family's tax relief,

helping working families with childcare and making investments in the nation's infrastructure, those are all great and i believe they will make a difference. but what can you do in states like new mexico, in states like alabama, south carolina and west virginia that are all feeling the same thing? what specific strategies in the president's budget jump starts these states and these economies who are still bearing the biggest brunt of the recession and are not seeing that economic growth? what's in there specific for those states? more than those individual investments and middle class families. but really help those states jump ahead because we have a double-dipped recession. >> so i do think particularly in states that are not seeing wage growth and not some of those same benefits that nationally we're seeing, i do think that

the specific focus on how we make paychecks go parteder today, minimum wage is something that the president has pushed on that more and more states have adopted over the past year. but, also, ways to make sure -- right now, we have many families in new mexico -- >> and i feel offer about reclaiming my time, too. we're terrible. we ask you a question and then we don't let you answer. we're all famous for that. and i agree that that makes a difference. but if there aren't those jobs, but let me just give you something really striking. more children are hungry in new mexico than in any other state. 22 of new mexico are living in poverty, 31% of children are in poverty. object only 29.6 young adults 25-34 have an associate's degree. there are no jobs. there is no manufacturing. there is no productivity. you have to have a job for a minimum wage impact to have an impact.

focusing on wage earnings in the middle class that you are investing in those difficult states. there that to be a very specific strategy so that we all catch up in a way. >> the gentleman from south carolina is recognized for five minutes. >> thank you. i thank you for being here. i was struck by what you said to the chairman a few minutes ago and that was he had asked you about mindless austerity and mindless sequestration cuts. do you really mean mindless or

was that a misspeak? >> i mean that we should look to make smart cuts in programs that aren't working. >> it says mindless. >> the implication of mindless is it applies across the board one size fits all approach to cutting spends as opposed to what we're trying to do is be much more targeted. >> fair enough. was the president not smart in offering that proposal? >> i think the history was that it was something that was thought to be so bad that it would never go into effect. i don't think anybody at the time thought it was a smart strategy for reducing our budget

budget. >> i'll let you take that up with bob woodworth. a couple quick thoughts. you and my colleague said extending the life -- i just pulled up the social security numbers. i see nothing that extends the life of social security trust fund. >> what i was saying is that taking steps to pass comprehensive immigration reform would benefit social security and extend the life of the trust funds. >> maybe maybe not. >> cbo last week -- >> we could argue it. why don't we take into the entire rest of the world and extend the life of the trust fund by that accounting. it's a longer theoretical argument is if you bring a bunch more people don't look at the cost. >> we do look at the -- cbo did look at the cost. >> it's a longer debate. my question is what is real in this budget is borrowing from

peter to pay for paul. you borrow from the social security trust fund to pay for disability now and that shortens the life of the trust fund. that's what's in this budget. immigration reform may not pass but we know as proposed in this budget is borrowing from peter to pay paul. why is that a good idea because i think we're in a real pinch regarding these trust funds. >> first of all, it would be terrible to let folks who have paid into the disability into the social security system have their benefits cut by 19% next year. what we're proposing is a solution that on a bipartisan basis has been done many times before. it's a very, very small impact on the retirement trust fund. i would agree -- >> it's a big impact because i think it's a fiction.

when you look at trust fund numbers what matters is cash flow. the cash flow goes negative 2019. if you take out interest it's in negative cash flow right now. we're exacerbating that trend line with regard to future borrowings based on borrowing from something that's now negative cash flow or going to go negative in the immediate future which plays straight into it. you just quoted cbo. you've quoted cbo throughout testimony. the place where you don't quote it is in economic projections. there's about a $2 trillion delta in with regards to where cbo is and where you guys are. if we run by cbo your budget is about $2 trillion out of balance. >> we're quite close in our economic projections to cbo. where i think we can agree -- >> quite close is $2 trillion.

that's quite close? >> on the economic projections that's not accurate. >> that is accurate. >> i think where we can agree -- >> where is that inaccurate? >> i'd be happy to spend time afterwards talking about the specifics of where we are relative to cbo. the important point is where we agree is that while social security isn't a primary driver of our deficits and our debts, it is something we ought to look at by doing the reallocation. >> i've got five seconds. the budget this year increasing government spending. revenue by 16.7% expenses. why is this a good idea? i'm love to get this in written format. >> you'll be able to respond in written form. the gentleman's time has expired. >> thank you. i do want to welcome my colleague from wisconsin.

i served in the state legislature. always glad to see you mr. director. i want to commend the president on including more money for the sec, the cftc and the consumer financial protection bureau. we hear many complaints in congress on a bipartisan basis about wall street having run amuck. about wall street having depends on who's estimate you believe. maybe something in the weight of 16 trillion worth of damage to our economy. i really do appreciate the president, the sec has complained and so has the cftc they have complained they can't really do their jobs without those being those expenditures

those resources being raised. having said that, we see some recovery in our economy and yet my colleagues not with standing that have said that the poor have become more poor as a result of the president's policies and i am just, just for the record sort of reminding and maybe you can remind us a little bit about the conditions that the president faced when he raised his hand in january of 2009 briefly. >> frankly we had the worst economy of our lifetimes and poverty rate was skyrocketing. unemployment wadss at 800,000 new jobs lost every month.

obviously, we've seen substantial improvement from there. >> i want to remind the committee and those who maybe knew that these were not policies. i was here during, i think it was the 111th congress when secretary paulson said we need $700 billion or else we won't have an economy tomorrow. i want to commend to my colleagues who say that it's the president's fault that may not be true. also i wanted to i was very curious as to why we have so many members on this committee to my delight are defending the poor.

i want you to remind us about the 112th and 115th congress the billions of dollars that were cut from food sustaining programs, food stamps, fights over the pell grant, unwillingness to provide unemployment insurance. can you just remind us briefly. >> sequestration, in particular has had a very negative affect on a number of programs. from my own experience at hud there were tens of thousands of families who lost housing assistance or in line that would have gotten it or didn't get it. particularly on homelessness and a range of other areas. i think there are areas in this budget where if we can get some bipartisan movement we could significantly improve the prospects for our lowest income americans. >> i'm very happy to hear that.

i was really happy to see the early childhood home visiting program and your anticipation that is going to lift the most vulnerable out of poverty, our children. i also heard a couple of our members refer to social security as a giveaway. i just wanted you to clarify for us what the social security program does and whether it deserves that characterization. >> as i said earlier these are benefits that have been earned. families have been paying in throughout their working lives to social security. we ought to protect those benefits. >> i thank you so much. i yield back the balance of my time. >> the gentleman from iowa recognized for five minutes. >> thank you for providing your insights on the budget and the economy today. >> thank you.

>> on your opening statement you stated we cannot afford a return to mindless austerity and i just would like to say with all due respect, the good people of iowa that i represent would not agree with you by increasing the federal debt by nearly $8 trillion under president obama is mindless austerity. i think the president's administration and your office lose credibility when we make those types of statements. isn't it a fact this is the worst economic recovery in the united states history post-world war ii. >> i don't believe that's accurate. >> it is. it is accurate. your budget has a ten-year average gdp growth rate of 2.5% is that correct? >> that's roughly correct. i don't have the numbers in front of me. >> do you happen know what the average for the last 50 years of gdp growth for economy? >> i don't have that in front of

me. >> it's 3.3%. in essence the president is projecting over next ten years a below average economy. is that correct? >> i think the president is suggesting that we invest in things that will grow our economy faster. >> if that were the case why are we projecting a less than average committee? >> we are suggesting the in investments should have a pos tifr positive impact compared to what we have. >> you're projecting, this is a fifth year average, you're projecting a less than average economy.

>> we are not, unlike dynamic scoring, or a range of other things projecting substantial impacts on these figures because that's not what is traditionally done on budgetary forecasts. >> i come from the private sector and just to draw an analogy, this would be like the president saying we're below average. our revenues for the next ten years are belowew average. our expenses will be above average. your pay will be below average. that in essence is what this budget is telling the american people. i know what i would say as a shareholder. i'd say you're fired. what would you say? >> i would say we should come together on a bipartisan basis and invest in the things that will grow our economy that will help prepare people to take

those jobs and that's what our budget does. >> when i talk about the economy in iowa i get asked this question. an 82-year-old lady asked me this last friday. she said can't we do better? can't america do better? how should i answer her? >> i think we can do better. >> why are you projecting a below average economy? >> we have laid out a very specific plan in our budget to do that and we hope we can work tot to get some of those things done. >> since this president took officer, working families household income is done. working families household net worth is down. you give a pretty rosy opening but a poll said 50% of americans believe we're still in a recession. i believe tthsit's because their net

worth is down. why do you believe 50% of americans still think we're in a recession? >> when we came into office we were in the midst of the worst economic recession of our times. we have fought hard to recover from that. in fact, when we have come together on a bipartisan basis, reverse sequestration what we have seen over the last year is the fastest decline in unemployment in 30 years. totaling 11 million jobs. we have begun to really turn this recovery around from one of the great recessions of our -- in the history of the country. we need to build on that and do more. what's what we're proposing. >> the gentleman's time has expired. mr. ryan is recognized for five

minutes. >> thank you. congratulations on your promotion. we live in a society today where we put our food in the microwave and hit a button and hope in 35 seconds we've got a hot meal. if we're driving around we can go to fast food restaurant and immediately eat. if we get on the internet we try to click and if a web page doesn't come up in 2.5 seconds we're upset that we can't access it quick enough. i understand that urgency that we all have culturely now. i think this hearing there's a high level of delusion coming from my friends on the other side. i say that with all due respect. no one talked about the previous decade on how we got to a point where our deficits were almost 10% with a complete economic

collapse. it wasn't our economic philosophy implemented at that point. it was yours. you had the house senate you implemented supply side economics. you deregulated the markets. you fund the police on the beats and make sure everything was happening in the up and up. then the economy collapses and here comes president obama trying to fix the mix. i remember being here and listening to all my friends on the other side. pass obama care, the sky's going to fall. the economy is going to collapse. we're not going to be able to grow the economy, unemployment rate will shoot through the roof. deficits will go up, not down. same with unemployment. i'm sitting here looking at the numbers. 9.8% deficit is the percent of the gdp down to 2.8 in 2014 and

2.5% projected out to 2025. you see what's happened with health care. insurance premiums, 10.8% prior to for individual markets. 8.7% growth after the affordable care act. small group insurance 10.4% growth prior to. 6% growth after. these are facts. instead of sitting down with us saying we've got other things we need to do, this isn't perfect. how do we get wages up? i think that's the kind of conversation the american people want us to have, not revisionist history as to how everything that is a problem in society is president barack obama's fault. i'm thinking that he was responsible for the interception at the end of the super bowl game and the republicans are

going to blame obama. he called an audible and he shouldn't have. that's the level of scrutiny and unfairness coming to the president. now, as i said, the sky was supposed to fall and we've had these things. i want to make two quick points. on the tax expenditure piece, the reason it's an expenditure because if the tax rates were going to stay. here is the tax code everything stays. here is the money that's going to get generated and we come in, congress, president and we carve out little exemptions for certain company, credits and all the rest. that number goes down. all things being equal this is the number we would have but we come in and manipulate the tax code and those are called expenditures. it's a market distortion for our conservative economists. i'm okay with some market distortions because i don't worship the free market like it's infallible. i'm okay with some of these

incentury tifrsencentives in here. let's be honest about what it's called. lastly, your budget, and i commend you for it is going to put money in the pockets of average people. if you can have community college where you can save some money and go get retrained or send some kids to school, that's money you don't have to spend on community college. that's a good, that's a public good. child care same way. while we got to work to figure out how to increase wages, these are programs the child care the universal preschool these are things that will move our economy forward. lastly, i'd like to say we had a tiger grant in my community, in the city of kent. $20 million, drew over $120 million of additional investment because of that targeted. we have the first manufacturing institute. we had a company come in because of the institute and donated

$440 million in software to youngstown state university. we have corporations now in downtown youngstown. your budget -- >> the gentleman's time. >> your budget understands this. i commend you for that. >> mr. palmer is recognized for five minute. >> thank you, mr. chairman. earlier, alice in wonderland was mentioned. i'd like to bring up a fable about the ant and the grasshopper. i think we're all familiar with that. the ant was very diligent in preparing for the winter. warned the grasshopper he should as well and the grasshopper was dismissive and undisciplined. we know how that turned out. when winter came, he starved. the fiscal winter is upon us. if this budget is any indication, this administration is playing the role of the

grasshopper. the obama budget still has a deficit of $463 billion adds almost 1 trillion more to our debt. this might make since to the administration but it defies some common sense. if you spend more than you take in each year especially with a $19 trillion debt, can you honestly believe this is a responsible budget? >> i believe if you look at the record -- >> it's not the record. if question is if you spend more than you take in is that responsible budgeting? >> this is a responsible budget. it keeps deficits below 3% of gdp, a widely recognized stand reduces our debt. >> you mentioned in this budget there are savings in medicare and medicaid that are generated

through the independent payment advisory board. aren't those savings really going to be on the backs of seniors who are denied services? >> in fact the so-called ipab only, the recommendations only kick in if savings in our health care is not as much as we would expect and most importantly, the recommendations can't deny service and anything they recommend comes to congress for approval. >> i just find it astonishing that so much emphasis on taxing job creators the people who create jobs. i understand who the job creators are. i find it astonishing that you want to punish the job creators yet count savings against seniors who very likely will be denyied access to services.

let me ask you this. you impose a 14% tax on untaxed foreign income. a minimum of 19% on all future foreign income on u.s. business. at a time when some of our biggest companies such as burger king and medtronic are moving their headquarters overseas and countless others are look at it because the u.s. is punishing tax code. what makes you think that adding more taxes on these companies for doing business internationally will keep them rooted here? >> actually our business tax plan would lower the domestic rate from 35 to 28% and it has specific provisions that would stop companies from these so-called eded inversions and create incentives to bring money back home, bring jobs back home and invest it here in the u.s. >> a long way off from making us

competitive with other countries. >> you mentioned the savings generated through this administration's savings policy. given the likelihood this congress will not pass this administration's budget, how much does the president plan to do through executive order? >> the president has already taken action within the power that law grants him. he's made clear -- >> he's taken action beyond the power of the law. >> he's made clear that congress should act to change the law in way that would not only grow our economy but bring down our deficit. >> he also says he has a pen and phone. he's already used it in an unconstitutional manner. i'm wondering if there's been any discussion in the white house about implementing some of these things. this irresponsible budget

through executive order. >> i think when the president took action last year he made clear that he was acting within the authority granted him by law and that there were additional steps that congress needed to take that on a bipartisan basis the senate came together and agreed to and that those steps would have powerful affects to grow our economy and reduce our deficits. we ought to come together and take those steps. >> the gentleman from michigan is recognized for five minutes. >> thank you for being with us today and for your testimony. there are a number of new spending programs in the president's proposal, but one area i was interested in and i wanted to get your feedback on the great lakes restoration initiative. there was a $50 million cut. i bring that up because you may be familiar with the asian carp

situation and i believe that's used fight species in the great lakes and there was edna found on asian carp. the equivalent of one city block away from lake michigan. the great lakes has about a $7 million fishing industry and the asian carp would be a serious threat to that. at the time when we're offering free college and all sorts of other increases in spending and different programs, why did the president recommend cutting spending in this important area. >> specifically there, there is a significant amount of funding from prior years that's still available. we felt that by combining the $250 million we're proposing in

our budget existing levels and hundreds of millions of dollars of other funding that is not in that specific restoration initiative but in other parts of the budget that would maintain the health of the lakes that we have sufficient funding in the budget to continue the important work that you're talking about. >> do you feel because as in michigan and throughout the area there's a feeling that there hasn't been enough progress made. there seem to be delay after delay and at the same time the army corp. of engineers and epa is focusing on other priorities whether it's regulating the water on farmers property or other priorities against coal it seems that this area of fighting and having a long term solution that's implemented

quickly is not a priority and i guess i'm curious why isn't that money being spent that has been allocated and secondly isn't there a way to make this a more urgent priority on the part of the administration. >> i want to assure you this is an urgent priority. we can sit down and talk about the issues around the prior year funding and how we accelerate this. >> just another question on the community college proposal. how was that proposal developed? was it in consultation with the community college association where people consulted on that? i haven't heard the exact amount

of dollars the cost estimates both for the federal government as well as for states and what that means. >> there was extensive conversation with a broad range of not only community colleges but others. it's structured this partnered with states that are interested this doing this. what we're doing is offering incentives that need to be matched by the state and structuring it in way so-called first dollar in to ensure that it not only would help cover tuition but that oir funding that a student might be bringing themselves to cover tuition can

be used for covering books all the other costs around community college that often stop access from happening. there's not a cost estimate. >> there is. i don't have it in front of me. $60 billion. >> the gentleman's time is up. >> i think you answered my question first you would have been done a long time ago. appreciate you being here. i understand your math on the $400 billion in projected savings on medicare and medicaid. i'm an engineer. the math is easy to understand. the logicdge logic is harder.

there's another eight to nine million americans eligible for expansion funding in the states that haven't expanded. i assume the administration is holding out the other states will expand. how much has been spent on medicaid expansion today and the second part is how does the administration budget for the potential enrolees and how much is in the president's budget for that? >> i'll have to follow up with you on the exact figures. we do budget for projected enrollment based on an expectation of further states. i don't have the exact figures in front of me, enrolling and joining. those costs were fully projected

as part of the original estimates and scoring done by cbo. they showed it would contribute to deficit reduction. >> is it safe to say that medicaid costs are projected to increase from the levels they are right now? >> that is why these savings proposals are critical. it's also why the cost saving measures that were part of the affordable care act more broadly and dramatically reduced the expected cost of medicaid going forward are so important. >> are you cutting costed in med

medicaid? >> what we're proposing to do in our budget would make changes that will reduce costs to what we expect. that's the critical factor. >> i think the critical factor we're seeing expanding medicaid costs and a growing population that depends on medicare and saying we're going to save $400 billion in those two programs. it's easy to see it's not equitable for expansion states to receive dollars while non-expansion states see nothing.

under expansion a state can get 100% funding for a 28-year-old medical school student while the same state might only get a 50 to 75% funding rate or match rate based on the state for a disabled child. do you think that's fair and equitable and proper use of america's hard earned tax dollars to have those match rates set up that way? >> the act was structured in a way to encourage states to expand medicaid. in fact, to go to your larger point, those folks are getting medical care somewhere now. they're going to emergency

departments, those are costs that are typically falling inging on state governments already or hospitals or others and often those costs are higher because their waiting to seek care when it's an emergency. if you look at the broader picture if we're implementing expansion, we're seeing it's a very responsible fiscal choice that they're making because not only are they improving the health of those citizens, they're lowering emergency care costs and others that are falling either to state governments or to private hospitals and others that have to absorb. >> gentleman's time had expired. ms. black is recognized for five minutes. >> i know this question has been asked but i want for the record, does the president's budget

balance at the end of the ten-year window? >> the president's budget meets the key fiscal tests that we set out -- >> that wasn't the question. yes or no? does it balance at the end of the ten-year window? >> it achieves the key fiscal targets that we set bringing deficits below 3% of the gdp throughout and reducing the deficit by $1.8 trillion. >> thank you. i'm going to reclaim my time bauds i know it adds $8.5 trillion in debt. that's a direction i don't think any of us should be going toward. i want to take this to a point in the budget that it comes back to very personal thing to my state where the president is offering this new program where folks can get a free community college education. he did come to the state of tennessee and visit us and he

patterned it off of the tennessee promise program. i want to clear for the record that it is not the same. it's being said this is the same as what we're doing in tennessee. in tennessee the students must be high school graduates coming out of high school. the program requires that there is a mentor. they have to do community service time. it's a 2.0 gpa and it also comes from the lottery reserve, so it's not an additional debt for our state. what i see in the president's budget is that we're going to have a $60 billion cost of over ten years. that's not also including if this were handed down to the states what their cost would be. it's about another 20 billion dollar for the states. it's a different program entirely. it's paid for in a different way

not by taxpayer money but by lottery money. how did the administration arrive at the estimate for the cost of this federal program over the ten years? >> i don't have that detailed information in front of me. i'd be happy to provide it tot your officer afterwards. it's more than fully paid for by other savings and revenues that we have in the budget. it's fully offset. >> by additional taxes not cuts? >> we do achieve savings on the spending side as well. it's fully offset in the budget. >> additional taxes. how many additional new tax will be in this budget? >> what we do on the tax side, we have 44 million families, middle class families who have their taxes cut by an average of $600 per year. that's fully paid for.

in addition, we have about $640 billion of loopholes that we close and other revenues we raised from highest income changes and we have significant revenues that come from new workers. >> if i could reclaim my time sir. thank you very much. since the federal government has become a main player in the student loan market we've seen a skyrocketing of tuitions. what do you think this program is going to do considering what we've already seen has occurred as a result of the federal government getting involved? >> actually what the president has done during his time in office is to dramatically increase assistance to students through increased pell grants and a number of other means. we're proposing in this budget to significantly expand tax credits for families that are

paying for college to help them and we have created a score card which could hold colleges accountable to actually lower their costs and driver down tuition. >> that does help me because that tells me you've done something on the other side. i'd like to see that information. there's a great concern that policies and especially this with the student loans, we have seen the tuitions really go up and really push a lot of those lower income and middle income out of actual market. i just want to end here by saying that i'm very concerned about the states and what kind of mandate this would place on the states because $20 billion for states that are already struggling is a lot of money. thank you. >> it's fully voluntary. i would point out. there's no mandate here. states can choose to join the program or not. >> i think it would be difficult for states if you're putting that out there for them to make that decision but thank you. i yield back. >> the gentleman from virginia

is recognized for five minutes. >> can you hear me? >> i can. >> what's your background, economics? >> i have a public policy degree. >> the only reason i ask, i'm trying to be bipartisan here and go through some numbers and get the state of economy. if a member asks does the budget balance within a ten-year window and we can't get a yes or no so we try to do science and answer the value judgments are off the table but the facts are all very much on the table. i just wanted to go through some other numbers that are even bigger than that. i'm just kind of disappointed we can't get a yes or no on that simple economic question. i want to go bigger in terms of the macoeconomy that affects the

work we're doing. we're trying to put together a budget that bipartisan moves the company in the right direction. the fed has three and a half treasuries on their books. if you look at the strength of the economy everybody knows the stock market is up. when ever we do quantitative easing peel 10 or $20 billion off, the equity market gets in a spin. is that your -- do you view the equity market in that way too. >> i guess i'm not sure what the question is. >> i'll move on from that one. on the deficit i was in earlier and you said it's good news, the deficits are going down. i agree with you.

we're moveing in the right direction then they go up by over a trillion dollars by most forecasts. that's in the bigger environment that that also is lifting up the macroeconomy if you're spending borrowing from future generations that's going to lift your current economy. how do you view the intergenerational fairness on the next generation when they're at $18 trillion in debt already. we'll be adding 460 billion this year. how are we doing them a service if we keep moving in that direction? >> i think the numbers are under current policy. this goes back to the key tests i said our budget meets which is instead of debt and deficits rising as a share of gdp we stabilize them and begin to bring them down and part of the reason for that is that we focused on the key drivers of those long term deficits and

done things in the budget that the impact grows over time like the revenue changes that we have, like the health care cost changes and immigration reform. >> good. i don't want to dwell on. the immigration reform, that thing scored in terms of helping social security. that was scored out till what year? if folks come in and tribute to social security how many years is that scored out? >> it's not just social security. we have a fundamental demographic imbalance. we bring in more workers. they're paying income tax as well. >> skip that one. i got a minute half. bigger issue in terms of you trying to do some good moves on the deficit side and have some policy drivers that are driving the right way. the entitlement side is go to

the bottom of the debt clock it's at 125 trillion. not only the debt burden but the entitlement burdens, those four programs take up the entire u.s. budget by 20 be32, i think it is. most of the programs are insol insolvent by 2032. i tell seniors all the time, everybody say within a ten-year window we'll take care of you. there aren't going to be any programs in 2032. there's none for the next generation. what are the drivers we're using to fix those? >> health care costs are the single biggest driver. i think what we can do on bipartisan basis is work together. we put the fix in our bill and added a number of reforms that

could accelerate delivery cost reform. we have $400 billion just in the ten ten-year window that do hopefully accelerate the trends that we have seen. we can do more on a bipartisan basis in that area to make a difference. immigration reform we should recognize is an enormous impact. >> the gentleman's time has expired. >> thank you for your time here. i want to read you a statement that former president made. we have experienced four straight years of surplus. a stretch of prosperity last seen world war i. for three years in a row we have been able to pay off 363 billion of this debt and expect to pay off 600 billion by the end of this year. with a sustained commitment to fiscal discipline to use the surplus to pay down the debt this nation can be full by debt

free for the first time since 1835. we can eliminate the publicly held debt by the end of the decade and strengthen our economy in any idea who said that? >> i've got a pretty good idea. >> president clinton said that after he left office. the president's already said that a democrat president working with a republican congress can get things done. reading your testimony here and following up on mr. sanford's comments. in your second paragraph you talk about mindless austerity. i think we need to be careful with our rhetoric. that mindless austerity has go back to the first paragraph and you say that the budget comes on the heels of a breakthrough year for america. today america's a soupenergy super

power. if this mindless austerity has caused this i think we need the go back and re-examine. even though the president's sequester is not what everybody wanted, but the president should have been careful in asking for it because even though he may not expected it to happen it happened. that's the only reason why we're seeing deficits being reduced. it's not because of an act of congress. it's because of inaction of congress in the white house working together. i would like to display a chart on the screen if possible another quote that was actually said not too long ago says that our national debt is our biggest national security threat. former chairman of the joint chiefs of staff admiral mike

mullen made this statement. looking at the net interests spending compared to other spending in fiscal year 2025. if do you look at where defense spending is compared to net interests, isn't the debt our greatest threat to this country if we start to see interest continue to rise at the rate that it's going? >> you heard the testimony of the joint chiefs this past week they said, specifically that sequestration was a major threat to executing on the president's national security strategy. >> not the greatest threat. admiral mullen says our national debt is our biggest national security threat. do you agree with that? >> i guess i would say that making the key invetsmentes in our defense in middle class

families if we don't make thoeds invetsmentes i would say that is our greatest threat. >> who needs to make the investments, the federal government or the private sector? >> on the national security side we have key -- this is not about public versus private. this is about ways to work together with the private sector whether it's infrastructure or rnd or a range of other things. >> going back, do you agree with mr. mcclintock that a dollar came from taxpayer? >> absolutely. all of the spending is more than offset by other spending or cuts and wasteful spending in the tax code. >> the debt is going to double under, almost double under president obama's

administration. >> under our proposed budget we would reduce deficits by $1.8 trillion compared to what we're expected. >> the federal debt was 6.3 trillion. today it's over 18 trillion. almost 20. the fact is it's only going up. the net interest that's not something we can change in our line items in our budget and say we're going to just pay less interest on our debt. >> looking at nominal dollars without inflation. let me go back to one point you made quickly. sequestration is a small part of what has reduced our deficits. >> gentleman's time had expired. >> a range of areas are important. >> gentle lady from missouri recognized for five minutes. >> thank you. following up a little bit on our discussion about national defense, your budget shows the

department of defense is requesting an additional $38 billion above the cap to make up for readiness shortfalls in the budget and there's the dollar for dollar match that's been mentioned in spending between non-defense as well as non-defense portions of the budge tt for the first six years. >> as the president said earlier this week, our national defense and our economic future are intimately linked. we can't do one without the other without shortchanging the economic future of the country and our national security. veterans benefits, the department of homeland security all of those are funded on the so-called non-defense side. those are critical for our national security as well.

>> i don't see the break down between those. our budgets have always provided for our veterans. can you explain how our national security strategy and the necessary funding to execute that strategy should be contingent upon a dollar per dollar match? >> i think what we're saying is that we got critical priorities whether it's investing in our kids, rebuilding our roads, making sure we're keeping the american economy innovative through rnd. that's critical to our national security as well. >> okay. what are the threats in the world today that are in the presumptions that under the president's budget? what are the threats today? >> detailed examination with the department of defense of the current national security

strategy and we added in targeted places that enhance our capacity. the intelligence gathering that we have range of areas driven by the joint chiefs. >> i wanted to go back to the observation that it raises just the first six years and now i'd like to call up a slide that shows that and actually from the year 2022 to 2025 you decrease both of those. by the end of the ten-year window you're only increasing defense spending by 9 billion dollar by inkreetscreasing the non-difference by $200 billion. why it is proposing more for

non-defense. >> we have worked with defense. we have done that through reversing sequester over the remaining six-year period. >> do you believe non-defense spend sg of greater national priority than defense and deserves more funding? thaths that's what the budget reflects. >> i disagree that's what it reflect. >> it's not shown on this. >> in the spirit of trying to get progress here, what we've done is build on the precedent of the murray ryan agreement. dollar per dollar increases fully offset by the changes. this is not our model.

it follows what congress has done successfully on a bipartisan basis. >> i believe this budget reflects addressing threats in this world. the defense strategy is being dollar driven rather than threat driven by this president. we need to look at threats. we need to get our priorities back and the budget should reflect that. with the few things we should do in congress is provide for the common defense. these cuts that have taken place do the military are devastating and the president's proposal does not address those shortfalls. our national security is at risk and i think we can do better and we will as a committee here. thank you very much. i yield back. >> gentle lady yields back. we got more than enough time for the most patient member who is recognized for five minutes. >> thank you for your patience.

first of all, she left but i'd like to think it's good news that representative moore is back and feeling better than she was a while ago. also like to thank i know there's going to be some administrations but like to thank you you and the administration for introducing mindless austerity into the american lexicon. earlier a couple was talking about the husband running up the credit card and the wife paying for it. now we have them use mindless austerity. going over this one more time, ten years out, you are not close to balancing the bumdget? is that something we should be working towards? >> i think what the budget ought to aim for is making the key investments that we need to grow our economy and make sure we have a strong middle class.

to do that in a fiscally responsible way and that's what our budget achieves. >> you believe adding trillions of dollars to the federal debt that will have to be paid off by children or grand children, by your definition that's fiscally responsible? >> this budget reduces deficits. it's a total of 1.8 trillion dollar of reduction than the path we're on. >> one of the things that's been thrown out there is way of reducing federal spending. most states when they're saddled with responsibility say we'd be willing to take less money if we get more freedom on how we spend the money. would the obama administration be willing to look at say block grants for medicaid as way of reducing spending?

>> obviously i haven't seen details of the approach but in general, the proposals that we've seen to block grant medicaid harm beneficiaries and don't end up providing health care in a way we could support. we do have in the budget this year, a proposal that would work with states and localities with a number of block grants to try to give them more flexibility. it's something that we think on a bipartisan basis would be worth while to pursue so there are places where we could work together on a bipartisan basis to give states and localities more flexibility but blocking medicaid is something at least in the proposals that we've seen leads to better protection for american families . when hi, deal with superintend ants they complain with federal involvement in local education. they almost uniformally say

they'd be willing to take less money if you take away the federal regulation that go was it. i think soon they are going to authorize the no child left behind act. would it be something that your predecessor signs that i never did like. do you think it would be a good idea maybe to reduce the amount of education funding so some of the states if we removed some of the mandates. >> first of all we should be focusing more on education not less but certainly if there are burdensome requirements that don't serve a purpose, we're happy to look at those and try to make changes what i will say though on a bipartisan basis there's been support for creating more accountability for results, not for paper work or needless regulations but results and that is something that's absolutely critical.

it has helped us to make progress to have the highest gradation rate and something that we do think should happen when we authorize no child left behind. >> one question for you. there's something here that bothers me a little bit you're -- which is fine. i appreciate you realize maybe the important job in america is raising children and you're increasing the child -- the dependent care tax credit. one of the things that concerns me a little bit about that is there are some parents -- some families in which bother parents work and some parents are making a sacrifice in which one parent states home. nevertheless you have a substantial tax reduction for families in which both parents work and are leaving aside, you know, the families in which a huge sacrifice is being made and there's not a child care expense. could you comment on your apparent dislike or not caring

about -- you know, the huge bias against families that are not using daycare. so first of all you may be referring to the second earner credit that we have in the bummet as partbum et budget as part of a -- >> the gentleman's time has expired if you've got a short brief answer. >> we have lots of other ways that we're supporting one earner as well as two. >> this concludes our hearing. i want to thank you so much for appearing before us today. please be advised that members may submit questions that may be answered in writing and may be part of the formal hearing record. this committee stands adjourned. thank you.

on the next washington journal, national journal technology correspondent brendon

on net neutrality egg regulations of internet providers and we will talk to hampton virginia university president william harvey. washington journal begins at 7:00 a.m. eastern time. call in with your questions and comments and send in your thoughts through facebook and twitter. thursday, president obama delivers remarks at the national prior breakfast. the dauly llama will also be in attendance at the live event. live coverage at 8:00 a.m. eastern on cspan 2. here are some of the our featured programs for this weekend on the networks. on book tv saturday night at 10:00 afterwards. the washington bureau brief on the british efforts in 2009 to

top the taliban. >> and the u.s. senate's torture report and why his company decided to public it and on cspan 3 all this month, interviews with former korean war pows including charles ross who was held as a pow from 1950 to 1953 by china and a look back at the voting rights acts 50 years later with cbs news white house correspondent bill plant. you can find our complete schedule at cspan.org. >> e-mail us @comments@cspan.org or send us a tweet. join the conversation like us on facebook follow us on twitter. the senate ageing committee

examined exploitation of seniors on wednesday. this hearing is about 90 minutes. good afternoon. it's my great pleasure to call to order the very first hearing of the senate special committee on ageing in the 114th congress. i've had the honor of being a member of this committee since

my very first days in the united states senate and i'm delighted to now assume the chairmanship. this is the first time that a main senator has sharped the committee since the late 1990s when my predecessor and good friend senator bill cohen whom i worked for for 12 years served as the committee's chair. i'm also pleased to welcome both new and returning members to this committee and i'm delighted that my good friend and colleague, senator clair mchascle of missouri will serve as the committee's ranking member. senator bill nelson the former committee chairman has also chosen to remain a member of this committee and he will continue to share his expertise.

throughout history congress has been urged to take action and it has done so in a bipartisan manner manner. i will continue that fine tradition working closely with senators and all of our members. this year the committee will focus on three major issues, retirement security bio medical research investment that disproportionately act your seniors and other scams targeting older americans. today, we will examine the harm

of some of our most vulnerable seniors. this committee has come to light many schemes that have defrauded seniors out of their hard earned retirement savings. it is deeply troubling when a senior falls victim to one of these schemes. even more egregious is when the perpetrator is a family member, care giver or trusted financial advisor. financial exploitation of older americans is a growing skpedand costing us. there are 14,000 new reports each year of senior abuse which includes financial exploitation.

in as many as 90% of financial cases, the senior is victimized by someone he or she knows well w. unfortunately the real case is even worse. many of the cases are never reported because they are not going to report financial exploitation, particularly when it involves a family member. as a consequence the true incidence of this abuse is not known. >> identifying victims is particularly difficult because we maners take a look. in addition since victims who have had their assets stolen by family members to be criminally

prosecuted, the stolen money is rarely recovered. this loss can undermine the health and financial security of older people. combating financial abuse of seniors is primarily the responsibility of state and local agencies, particularly adult protective services agencies. prevention and response to cases of abuse require coordinated efforts, including state and local agencies, law enforcement the social work and medical communities and financial institutions. the federal government also plays an important role in providing plead provide providing leadership. the counsel led by the department of human services has brought together 12 agencies to coordinate efforts to protect

older individuals from abuse including financial exploitation. i also want to acknowledge the creddic critical role played by state regulatory agencies. i'm particularly pleased to welcome to our hearing, judith shaw who serves as the securities securities administrator of maine. maine is on the cutting edge of combating the fanlinancial abuse of seniors with a program which is the first of its kind in the nation. i won't preempt ms. shaw's testimony by describing it but i think it provides a model for many states. financial exploitation knows no socio/economic boundaries. victims range from seniors who

have very modest financial means to those whoa have amassed great health. for example, if it were not bad enough, the daughter and her boyfriend went onto deplete her mother's life savings over the course of two years, leaving her penniless as well as homeless. while individuals of limited means are particularly vulnerable, even the wealthiest the most fortunate americans are not immune from mr. martial and socialite brooke aster who summered in maine for decades and who what's so generalious to

our state. he will testify how his mother while she suffered from alzheimer's. many times it is vital for a senior to have the assistance of a family or friend to help manage his or her finances particularly if that senior becomes becomes a troubling and complicated issue. i look forward to hearing from all of our witnesses today. we have a great potential about the efforts that are under way to address the abuse of vul ner vulnerable seniors. i do want to apologize that

we're going to have a vote here and we will try to make the interruption as brief as possible. senator. >> thank you chairwoman collins. a year ago if i had been approached in the hallway by one of the pesky people with a micro microphone and i were asked if the democrats were to lose control of the senate and you were to take over as a ranking member of the very first committee you cover serve on as a ranking member who would you pick for your chairman? i would have said without hesitation my friend my mentor and my role model, susan collins. she has been an example to me from the date i arrives ofd and watched her in the homeland

security meeting when she was the ranking member and was always willing to cooperate when it was essential. i am very proud to serve under chairman collins. the senior financial exploitation is not new to us. as a prosecutor in kansas state r city, i saw first hand both horrific and heart breaking instances of elder abuse. physical, roughly one in five seniors will be a target of some. this hearing will focus on cases with an additional conflicting factor when the perpetrator is a family members, a trusted care

taker or close friend or advisor. the numbers here don't really tell the story. thankfully we have self wit ps. perpetrators are constantly developing new ways to gain access and focused on a generation that's been list willing to self-purport. when a family member is around these become one of the nicest around. victims may expect what's happening but may feel powerless or ashamed to report. often a victim will start by filing criminal charges against a child or family member. today i want to reiterate that

we cannot shy away interest. it is really a recent phenomenon because for too long they were dismissed as family members. today we will hear from a seattle prosecutor who specializes in elder abuse criminal cases. she will talk about -- >> only an hand. you need competent and trained professionals amount. with detectives florencic accountants and of course trained investigators and prosecutors

prosecutors prosecutors. this hear she came to missouri to help develop interest. we maust dress the need for a prosecute can nltdot this. we must address this cooperation. there are those who say this is a state issue. yes, it is but it is bigger than just a state issue. the federal government can do better to assist local local and not

necessarily supportive of one another or the overall goal. since that time these agencies have begun to work together. the consumer financial protection bureau that is providing real guidance for them. there's still so much more we on doing and no. we don't know how many cases and i hope our witness twrz today can help and stay in our role in the federal government. i look forward to speaking with

our witnesses about how we can start eliminating zrimdiscrimination discrimination. too often they are dismissed because they are especially with mental capacity of a victim. my time is here. >> thank you senator. thank you so much tore your very generous comments. i want to welcome to the committee, a new member of the senate, senator sass, we're very happy to have you join us on the committee and welcome back to the committee this year, senator warren of massachusetts. we are going to turn to our panel next in the interest of

first we will be hearing from philip martial but he'll be speaking today as a family member of someone who i mentioned in my opening statement and we very much appreciate your willing tons and then we will hear from judith shaw and the president elect of the north american securities association, an internally association devoted to investor protection. we will then hear from kathleen quinn, the executive director of

the adult services association. finally last but certainly not east. we will hear from the single deputy deputy. mr. martial, thank you for being here. >> chairman collins ranking member and distinguished committee members. thank you for inviting me to testify today. i am i am so grateful for your leadership and action on issues of elder justice, my name is philip martial i am a resident of massachusetts. i'm also the grandson, my father. as president of the foundation my grandmother advanced its mission by giving millions of

dollars to social and cultural causes. in 1998 president bill clinton and well into her 90s. by 200 when she was 100, she disappeared from the lime light. she didn't return till july 2006 when my guardianship petition which i filed to protect my grand grandmother against my grandfather was discovered by the press. front page headlines displayed disaster for mrs. hafter. my grandfather nor did she. well in the throws of dementia chose, manipulated and robbed

yet the circumstances have formed a timely cause in elder justice. this may be and enriching himself with millions of dollars. after three months battle and five days before our court date a settlement was reached with permanent guardianship awarded. we'd achieved our goal. my grandmother sent her final days in her country house with care in comfort.

a a criminal investigation was zbnl investigated. in 2009, my father was foun guilty of 15 counts against him. all but one were held up on appeal. this was a very bitter/sweet harvest but this harvest has no nourished the cause of elder justice. later in probate, charities were awarded tens of millions of dollars that my father had tried to direct to himself. because my grandmother now rests in peace, i could resume my life was before but i realize, to be complacent by elder justice is to be complicit in elder aabuse. >> in this2010 i have been coast to

coast, border to border with elder practitioners. i thank them for doing so much. many elders lack vigilant oversight and remain helpless and hopeless. all of those providing. these services need federal funding and support to respond adequately to an increasing number of elder abuse. while my grandmother's abuse and clek iveive collective.

here much greater financial support and multidisciplinary teams would be so helpful. while mythis and will respond to and prosecute these cases. while my grandmother's stolen assets were reclaimed, many elled elders never reclaim their money or their lives. here, financial transactions enhanced detection mandatory reporting or greater reporting of suspicious activities will so help. financial monitors must be matched by physical monitors to insure elders well being. finally, i urge congress to

reauthorize the elder justice act and the older americans is a trend, it's not our destiny. thank you. >> thank you very much mr. marshall for your very compelling testimony and your advocacy. ms. disaster was beloved in my state as well and did so much good throughout her life. >> thanks. >> ms. shaw. thank you senator, ranking member and also president elect of the north american security's administrators association although i am not testifying before the committee in that capacity today. i am honored to be here to discuss one of the most serious problems facing our elderly financial exploitation. and to present one approach in maine.

addressing this is difficult but critical. many in our elderly population are there with other support networks. the days of americans surrounded by generations of family members are fading into the past. what do we know about this population, we know that older adults are often targets of exploitation in part because they own assets and pension schemes that are attractive to exam artists. when a fraud occurs even seniors with a limit d limited. we must all come together to weave a new safety net that can