the goal to maintain the restrictions as they are, maybe loosen them ever so slightly, essentially keep them in doha? what is the ultimate goal? >> i can't get into the substance of the requirement -- >> i understand the negotiations are -- a lot of variables there and factors equities, stake holders, et cetera et cetera. what's the goal? >> the reason it's hard to talk about the goal is because the restrictive conditions in place are not something we talk about in detail publicly. when it comes to the goal it really is making sure that there are measures in place to protect the american people and the united states and our interests. and what exactly -- what exact form those restrictions take is something that we'll discuss with the qataris but not be able to discuss publicly even after

an agreement is reached. >> tony -- said in an interview in france that air strikes in the campaign that began last summer have killed more than 10,000 jihadists. wouldn't specific numbers in iraq and syria. is that a number that the president is comfortable with? it's a number far larger than we've seen before to my knowledge. i may have missed it. is that the number the president believes is true is consistent with what the pentagon and other coalition partners informed him and what does that say about the state of the strategy is so far? >> major, what we are aware of is that there are thousands of isil fighters that have been taken off the battlefield due to the coalition military air strikes as well as the efforts of iraqi and kurdish security forces on the ground. and this is indicative of the kind of strategy that we see isil often use to essentially

sacrifice significant numbers of foot soldiers as they did in their failed attempt to take and hold kobani which we assess led to the death of at least 1,000 isil fighters in that one syrian town. we are also conscious of the fact that isil is aggressively recruiting foreign fighters around the globe to try to replenish their ranks. that's why our strategy is predicated on trying to counter the radical ideology and recruitment efforts of isil. we're trying to make it difficult for individuals who may aspire to join the fight to travel into that part of the world and take up arms even as we squary out missions on the battlefield that degrade and destroy isil. but as it relates to the number of isil fighters that have been killed i'd refer you to the department of defense for the

precise number. >> but no one from the department of defense used that number. the secretary of state used that number. i'm asking if the president is comfortable with this. first of all i would be curious how anyone in this administration could know any "n" a real sense of casualties on the ground in an air campaign where there is virtually no u.s. eyeballs and presence and you are fighting an enemy that is mobile secretive and hostile. this number seems large and i don't know how it could be credible. and i am wondering if you are comfortable with the assistant secretary of it is secretary of defense using this number. >> we know that iraqi security forces have the capability to carry out military missions and offer intelligence about what they're seeing on the ground.

the administration at the direction of the president has flooded iraq with isr equipment, intelligence surveillance and reconnaissance equipment to monitor conditions on the ground. there are ways that we can derive estimates but good estimates of what's occurred in the aftermath of some of these military operations. and i have no reason to believe that the number cited by the deputy secretary blanken was inaccurate. but for a more precise accounting of what that estimate is, i refer you to the department of defense. but we continue to be mindful of the fact that this is an organization that is working very hard to replenish their ranks and they need to do so. isil time and time again has essentially directed their foot soldiers to be sack official lambs in some instances. to go out there in essentially

hopeless fights against iraqi or kurdish security forces. -- >> [ inaudible question ]. >> i didn't say that. there are more than a thousand based on the assessments we have conducted there are more than 1,000 isil fighters who lost their lives in kobani. that is where isil sacrificed the lives of a thousand foot soldiers in pursuit of an effort to take over one town in syria, an effort that was ultimately unsuccessful. but you know, this is a much broader effort to degrade and destroy isil. and ultimately, and what we're going to need to see is a more successful and more consistent effort and execution of the strategy by isil by iraqi security forces on the battlefield. and we have seen important

places of progress. and there are some areas where with additional support we hope they'll recover from recent setbacks. >> you said earlier the supreme court could turn the health care system into utter chaos. is that a warning to the supreme court? >> of course not. is it a -- i think a -- the consequence that has been observed by a large number of individuals in both parties about the impact of the supreme court's ruling. but this is a ruling that that will be based on the merits of the legal arguments that were presented before the court and we've got a lot of confidence in those arguments. chris? >> you said repeatedly that you have a lot of confidence in the arguments and you have been asked repeatedly about a plan "b," what happens if the decision doesn't go your way. i want to make sure you understand you. is your message to the american people who now have this coverage that if the supreme court rules essentially against

the obama administration's decision they are out of luck and you don't have a plan? >> the message to the american people is they should be confident in the healthcare they have now because it is rooted in a sound legal basis that was presented in arguments before the supreme court. that's why we believe the people should be confident. and if that confidence is shaken based on an adverse ruling from the supreme court then that will have a substantial impact on the health insurance market in the united states. no doubt about that. >> you don't feel there is anything that the white house or president can do about it? >> most people assume and they assume rightly. it depends on the ruling and the scope of the ruling. most assume a remedy would require congressional action. and i think there's ample evidence that making a bet in favor of prompt, wise, and

constructive congressional action when it comes to health care is not a very good bet. >> i want to follow up on major's questions. there does seem to be among a lot of people inside d.o.d. and other military analysts that for the progress that is made for the isil/isis fighters taken off the battlefield that they are able as you have suggested continue to recruit and many think that is a net zero proposition. if what has happened as a result of u.s. policy and coalition efforts is essentially status quo in terms of the number of isis/isil fighters is that a failure of policy? >> no. we are building up the iraqi security forces and we anticipate wed would see better performance on the battlefield once we had introduced more highly trained iraqi security forces once we had saw more better equipped forces on the

battlefield their performance would improve and we would also see over the course of time, improvement in our efforts to coordinate with the international community to both counter the radical ideology and recruitment messaging from isil. we also have seen and will continue to improve upon our cooperative efforts to prevent individuals from traveling to that region of the world to take up arms alongside isil. but this is a -- this is a strategy, again where we have seen some success. we have also seen some setbacks. but we would anticipate that we're going to continue to make progress against isil as we see more and better equipped, better trained security forces both in iraq and syria taking the fight to isil on the ground. >> it's status quo in numbers taken off the battlefield and the number recruited. that's where you expect to be right now. is that what you're saying?

>> again, i'm not -- i think -- no. that's what you're saying. is the short answer to your question. i think what i would say is that we have a strategy that is correctly oriented to the situation that you're presenting which is that we have seen that there are a substantial number of fighters fighting under the isil banner in iraq and in syria. and we laid out a clear strategy for confronting them. is it a strategy that predicated on iraqi and -- in syria, syrian fighters taking the fight to isil in their own country. we'll support them by training them, by equipping them and offering them some advice in terms of how to carry out their military operations and back them with air power. we can shut down financing and recruitment efforts and counter the radical messaging of isil to make it harder for them to bring in recruits. and sofa with seen isil

demonstrate a willingness to sacrifice many foot soldiers the on the battlefield in pursuit of military operations that don't end up going their way. but we acknowledge there is more important and difficult work to be done to accomplish our ultimate goal of degrading and destroying isil. okay? john? >> i had a question on isis. there is testimony today in congress on those in this country who are feeding on isis propaganda through social media. are you confident that the administration has the tools it needs to keep track of and monitor those who are here in the united states radicalized by isis propaganda? >> you have heard from our law enforcement and national security professions that this is very difficult work. and the president, himself, has even observed on previous

occasions that the threat that he's particularly worried about is sort of the lone wolf threat, an individual that could be radicalized but essentially would carry out an operation of their own doing that would result in some violence. and trying to prevent that is exceedingly difficult. that's all the more reason that we're gratified that congress passed the national security act so that we can keep the country safe. >> they are saying that they don't have the tools even with renewal of parts of the patriot act. you have the head of the fbi today say one of the big problems they're facing is the availability of new encryption technology and they are in the dark. those his words they are in the dark. he is pleading for new authorities from congress. what is the last position on

this? he is saying that thousands are feeding on isis propaganda in this country and they don't have the authorities to keep track of it. >> this is a challenge -- >> not the patriot act. they are look for additional authorities. >> this is a challenge that the president has been mindful of. he had a chance to talk with us when prime minister cameron was visiting the white house earlier this year. does this set up a tough challenge of balancing the privacy of law-abiding american citizens with the need for us to try to detect and apprehend terrorists before they commit an act of violence. and you know, that's why the president has spoken to this and it's something that we're mindful of. you're right the other challenge that's presented here is that in -- when we're talking about technology we're talking about new innovation and it

means that the techniques that are employed by the -- our national security professionals need to adapt to the innovations to advances in the technology sector. that is a very difficult challenge but it's one that the president's team is focused on and frankly there is an opportunity for us in the mind of the president to work with the tech sector on this. that as much as they value and champion the privacy and civil liberties rights of american citizens, we also know that those individuals do not want to be in a situation where their technology is responsible for allowing somebody who is seeking to carry out an act of violence to evade detection from the federal government. so this is -- this is a thorny policy challenge and among the most difficult challenges that the president faces but it's one he's mindful of and one that his team has been working on and we

should be able to manage our way through if we try to seize the common ground consistent with the way that the house of representatives and the senate acted to despite the difficult challenges of reauthorizing the patriot act but incorporating reforms that put aside politics and do something right for the country. and even after ady delay by the senate that is what was achieved. and i think is it a model for how we can work our way through other policy issues as well. >> and a follow up to the questions about the polls. the president's political team does have -- does polling right and has access to polling, private democratic polling? >> there are certainly through the dnc and other place, the president does have access to some information. i would not say he is a frequent consumer. >> he must be aware of the

trends as -- >> i'm not aware of any democratic polls that measured the favlt of president bush. >> the approval of the handling of isis at 31% is an alarming number. i don't think he would -- >> no, not really. i mean look i think it is common sense that you know, that the fact that the united states government and the president is confronting this threat is difficult work and i think the american people understand what a significant challenge this is. but everything else being equal they prefer that the president and the united states didn't have to worry about isil but the fact is that we do. and the fact is that the president is very focused on these national security threats. even -- and that's why we have implemented the strategy that we

have. and you know this is not something that -- this is not work that's done in a way that reflects polling. it's work that's done in a way that reflects the core national security interests of the united states. okay. april? >> go into another topic. katrina. ten years in a couple months we will mark ten years since the levees broke in new orleans and the housing secretary is working down there. is the president expected to go to new orleans in august? around the anniversary of katrina? >> i don't know the answer to that, april, at this point. when we have scheduling updates we'll let you know. >> what can you tell us the administration is work on? when president obama came into the administration there were two cities he was looking at in a different way detroit and new orleans and new orleans started

coming back on its own and so did detroit to a certain extent and they fell into the same pot of other american cities. what can you say months out in ten years how this administration is viewing new orleans after katrina? >> i'll say a couple things about this. the first is that one of the things that the president did when he took office was to appoint craig fugate to run fema. and the confidence of the american people was shaken in our government's ability to respond in national security situations. and i think that confidence has been restored. the president made that a priority and having had the opportunity to travel with the president when he visited communities across the country that have been wracked by a national disaster, the citizens of those communities appreciate the commitments of their government to help them rebuild and recover and come back

stronger than ever. and that's a testament to the effective work of somebody like craig fugate and all the men and women at fema that work for him and it's a testament to the state and local officials that respond to these situations that fema is typically there to support the state and local officials who have the lead. and the president made that a priority when he came into office and for all the talks about trying to prevent a second great depression and for the president to look at national security efforts, there have not been as much talk about how that agency has rehabilitated their image. as it relations to new orleans more specifically we'll have --

i'm confident we'll have a lot more to say about this in august as the anniversary gets closer. but i can tell you that the president and his team have spent a lot of time working with officials in new orleans to help that city recover from the worst economic downturn since the great depression, that we have seen housing officials, officials from the department of labor and others talk about the work the administration is doing in that community to help them recover not just from the floods of katrina but from the economic downturn five years ago. and one thing we know from the data is that those individuals who were the most vulnerable in 2007 and 2008 were the individuals who were hit hardest by the great recession. that means individuals in new orleans that were recovering from this terrible natural disaster were hit by the great recession probably at the worst

possible time. but it's -- first off, a testament to the grit and determination of the people of new orleans to rebuild that city and their economy and rebuild so many of those communities that is rich and history and character, to put it mildly. but it is also is an indication of the kind a resilience we see in communities across the country. there is a broader story to tell about the renaissance that we're seeing in new orleans. whether or not the president travels to the community in august, i expect you will hear more from the president in august. >> candidates have a hard time talking about the concern that they have there is a national crisis with heroin, prescription druz drug deaths and what they would like to do as policy if they were president. is the president persuaded after listening to this commentary

coming out of primary states that there is more that this administration could do to tackle heroin and prescription drug deaths and mental health issues? >> this is a growing challenge in many communities across the country. i know that the ondcp under the acclaimed leadership of mr. bod chelsea has done a lot of work in this area. and i think what i should do is having somebody follow up with you with more specifics about what the administration has done to address this growing problem and what more we propose to do to try to head it off. i feel confident in predicting this is not a problem that will be solved in the next 18 months. but i think the president would like to see additional progress be made in this important fight. >> and one more question to follow up on isil does the president believe there are consequences for president assad in his regime if they are assisting isil in syria right

now? >> we have seen some of those news reports suggesting that there may in some locations in syria, not all of them but in some locations in syria that government forces may be acting in a way that is actually benefitting the isil forces. we also see reports that there other areas in syria where assad government forces are taking strikes against isil forces. but it's a murky picture right now. but that is indicative of the broader situation that we see inside syria that frankly it's because of the failed leadership of the assad regime that they have -- that extremists have been able to make inroads in that country. and that's why it continues to be the policy of the united states that president assad should step aside and allow for a political transition in that country so they can have a country that reflects the views

and ambitions of the syrian people. it's obviously going to be a long road. even if assad surprisingly announce head is leaving. that is a long road to rebuild a country but it's an announcement like that from president assad would be a very good start. paul? >> josh, i was at the security event this morning. and a gentleman who works with the fbi and other agencies shade, look, i think we have always been one step behind tracking the bad guys. i now feel like we are two or maybe three steps behind the bad guys. tell me how national security is enhanced, given the comments like these? >> i didn't see the comments and see who said them. but as a general matter it sounds like somebody was weighing in in a discussion about some of the challenges that our law enforcement

professionals face as they tree to keep us says. and there are no doubt there are significant challenges in that evident. that's why there is a lot of frustration on the part of the administration that there were simple steps that congress could take but didn't that would have ensured that they have all the tools available to them as they try to keep us safe. we are pleased to see that even belatedly that the senate did act and many of those authorities have been restored in a reformed way. the president is mindful of the challenge. the president's budget priorities reflect how significant a challenge this is. and it's something that he devotes significant time to. >> is national security enhanced or not? >> it's hard for me to evaluate that without seeing what the comments were and who said that. >> i told you the comments. the fbi said we're more in the dark than ever before -- >> you don't have to get hostile

about it. >> the fbi counter intelligence guy said we're more in the dark than ever before. that does not suggest we are safer. >> i think it reflects the challenges that are faced by greater encryption technology that is allowing some extremists to try to evade detection and this is a significant challenge that the president discussed in the news conference he convened with prime minister cameron earlier this year. and the president continues to be aware of this threat and he also continues to be mindful of the fact that he needs to be mindful that additional work needs to be done to confront it. and he is mindful that tech countries who are at the forefront would not want to be in a position many "n" which their technology is being defly

defly -- deployed to carry out violence. >> you said you don't have a vote count to give us. but i want to take that back a step. there have been reports from the hill from both sides of the aisle that they don't have vote counts from the other side and there is little information sharing even back channel. i'm curious if you are confident in the transparency? >> we do continue to be confident in the kind of working relationship that the administration maintains with leader pelosi on the democratic side. obviously, most of our efforts are targeted on trying to persuade democratic house members to support this particular piece of legislation. and there have been a number of conversations between the president and individual democrats in the house. there have also been conversations between the president and leader pelosi on

this issue. and, yes, we do continue to have a lot of confidence in the effectiveness of that relationship. but i would also point out that the white house and even the president has been in touch with republicans in the house on this issue, speaker boehner has indicated he strongly supports this legislation. we know that chairman ryan is planning a leading role in building support among house republicans in that effort and despite our many political differences and the challenges that we have had with leading house republicans on other issues i do think i can confidently say that we have been pleased with the effective communication between the house and leading house republicans on this issue too. and i think it is an example of the kind of progress that we can make when we're focused on those areas where we agree. there are many more areas where

we disagree. and our ability to coordinate in this area doesn't change that but it does highlight the potential that exists when we focus on working cooperatively in finding common ground. now i don't want to leave, again, have those comments leave you the impression that we have this all sewed up. there is a lot more work to be done on this. but i continue to be and i feel confident in telling you that we continue to be satisfied with the degree with the cooperation with the leaders on this issue. >> there is a report out this morning that stated a iran is still found to be developing ballistic technologies, obviously, with the deadline approaching at the end of the month on the nuclear agreement details, that's a concern because the technologies could be used to carry a nuclear

warhead theoretically. is that report something that will pose a challenge to get a deal done like the president wants to do? >> i haven't seen the details of the report. i will observe a couple of things. one thing that we indicated need be resolved were the outstanding questions about the possibility dimensions of iran's nuclear program. we are concerned about their many unanswered questions and we expect they would be answered in the context of a final agreement if one can be reached by the end of june. even if we are able to complete negotiations by the end of june, it will not answer all of the questions that we have about iran's questionable behavior in that region of the world. and that includes some components of their military program. so -- and we have been pretty blunt about that fact. and that's why you have heard me disagree when some have described this as a -- with

iran. this would not be that. but it would be a way for us to diplomatically prevent iran from obtaining a nuclear weapon. anita? >> the serbian prime minister is here and i thought it was at the invitation of the vice president who i believe who is not here. who is he meeting with? >> because the vice president is not here today that the serbian prime ministered me met with susan rice. we'll have more details today. >> is there any specific one topic? >> i think they discussed a range of issues. we'll see if we can get you more detail. >> meeting with the president? >> i don't believe the president dropped by that meeting. kevin? >> thanks josh. take you back to trade. earlier today, more than a dozen democrats came on camera and expressed their displeasure with the idea of tpa.

and i'm just -- it seems to me to be a little bit of democratic friendly fire. what does that say about the president's relationship with the party that so many, especially so many top democrats are so forcefully against tpa? >> i think it illustrates something that we all know that many democrats are opposed to trade legislation and opposed reflexively because of previous trade agreements. the case the president has made with some success is that this kind of trade agreement is one that includes for the first time enforceable labor standards and environmental standards and human rights standards written into the agreement that will level the playing field and have a positive impact on the american economy and on the economic opportunity that's available to middle class families across the country. that is a pervasive argument. i don't expect it will purr said

every democrat to support it. but when the president gave this argument to the members of the senate wed to go a third of senate democrats to vote for this bill. we're going to make a similar case in the house. is it an indication when we make the argument that there is ample reason for progressives in congress to support the bill. >> one big name that has yet to come out in support of it is former secretary of state hillary clinton. would it matter either way if she came out in support of tpa or tpp to the president? >> she doesn't have a vote in congress and it's those votes in congress that are counting right now. and so that's why the focus of our efforts is on members of the united states house of representatives, principally democrats but conversations with republicans as well. >> would it matter at all? would he care? >> she will have to make her own

decision about what she wants to say about this publicly. >> let me ask you about wikileaks wanting to crowd source about $100,000 to have people release details of tpp. are you aware of that report? >> our reaction is just simply there is no tpp agreement right now. we're working to finalize one. when we have one it will be made public and the american public will have an opportunity to review the agreement and speak their mind about it for two months prior to the president's signature. after the president signs it there will be a robust public debate about the wisdom of this approach and the wisdom of entering into this agreement. the president continues to be confident if we reach an agreement it will be consistent with the trade promotion legislation authority that has passed the senate and will hopefully soon pass the house. there will be an opportunity to look at the details of the

agreements and to consider and make up their own mind, frankly about what impact they would have on the american economy. byron? >> we have seen reports that the white house is reviewing its isis strategy. any updates on when we might hear from the president about changes or updates? >> number and i would remind you that the way that we have described this policy-making process is simply that the president challenges his national security team to continually be refining that strategy, to look at areas where we've made progress, to extract some lessons learned that can be applied to areas where we are experiencing setback. and so, i wouldn't expect any major presidential announcements on this in the near future but i think you can expect that the president will continue to engage in regular discussions with his national security team about how we can continue to refine the strategy and continue to build on the momentum where

we're seeing progress and shore up our efforts where we are seeing some setbacks. >> on iran does the white house have a plan in place to deal with the various parties who have concerns about the final agreement, gulf state allies, israel, many in congress. what is the white house plan for approaching this? >> i think you have seen in the last few weeks the president and his team have engaged with democrats and republicans in the congress about the merits of the political agreement that was already reached back in the first week in april. you've seen the president convene a summit with gulf leaders at camp david just last month where they had a discussion of a wide range of security issues in that region of the world. i would expect that those kind of conversations with gulf leaders will continue even if not in person. and the president i think has been pretty forth right about

his efforts to communicate with those who are most concerned about israel's security about how he believes the security interests of israel can be best served by using diplomacy to prevent iran from obtaining a nuclear weapon. and i would anticipate that we'll have the opportunity to do it again if we're able to reach an agreement in the last month of june. >> i know you talked about foya yesterday. the white house memo that requires all review of all foya related to the white house that is responsible for a backlog in foya. does the white house agree with that and why is the council reviewing foya? >> it's interesting that you say that. i have a quote from a memo put forward by steven markum

september 1st, 1988. it said records originating with or regarding the white house office should be forwarded to -- steven was a senior justice official in the reagan administration. january of 1992 steven -- who is a senior department of justice official said that records originating with or involving the white house office should be forwarded to the office of the council to the president for any recommendations they wish to make. this is an indication that this policy has been in place as it relates to recent presidential -- to two rentcent republican presidents. i would make the case to you that the memo is entirely

consistent with the policy in place under president reagan and under the first president bush. and at the same time, the suggestion that this memo has -- or this policy has created an undo backlog i don't think is reflected in the facts. you know, the fact is the administration has processed just last year 647,000 foya requests. and the fact that 91% of those requests did result in the release of some of all of the requested information. that is an indication of this administration's commitment to responding in full as often as possible to foya requests. i also recognize that there is a tendency on the part of those who submit foya requests to focus on the 9% that didn't get satisfactory responses. that is the job of those

individuals. but their criticisms do not reflect the accumulated evidence about our commitment to the foya process. >> getting back to free trade it's not just the economic aspects of this. it is political. the union and other groups are threatening democratic groups if they vote for fast-track authority. is the president promising political help? >> the president has made clear in public and privet a willingness to stand with democrats who stand with him on the trade argument and considering the president's status among democratic voters across the country, the president was the most popular and influential and well-liked figure in democratic politics right now. so having somebody with the president's heft on your side, i think is a significant political benefit. that is a promise the president

has made to support democrats who support the trade legislation. and i think that should give all democrats the confidence to vote their conscious when it comes to this issue. >> political threats that are going around. >> it's not something that keeps me up at night but my name is not on the ballot. those who are concerned take a lot of solace in knowing that they can count on the support of president barack obama in a primary if they need it. thanks, everybody. >> thanks. we'll have more road to the white house coverage tomorrow. former texas governor rick perry is expected to announce his candidacy for the 2016 presidential nomination. live coverage from dallas at

12:30 eastern here on c-span3. philadelphia mayor michael nutter addressed the 2015 graduating class of st. joseph's university in philadelphia. the mayor spoke about the amtrak trail derailment and pope francis' upcoming visit to the city in september. st. joe's was founded in 1851. [ applause ] >> good afternoon. the hawk will never die. [ cheers and applause ] congratulations to the class of 2015. i could not be more honored to be here with you. congratulations. let's recognize our graduates,

first. [ cheers and applause ] thank you, father gillispie to the leader of the political science department, thank you for that recitation of some of my history. i did lean over to father gillispie and say the intro may be longer than my speech this afternoon. but -- but see -- [ cheers and applause ] i thought you might enjoy that. to our great board of trustees and certainly our chairman ed moneypenny. to the many folks here that i've had the opportunity to know and work with over all of the time

that i've lived here in the winfield community. i moved here in 1977, have been actively and actively engaged and involved in the public for a long time. i have had the opportunity to represent st. joseph's university. i have got to know so many here. i would like to recognize a few of those folks our dean joe deangelo; dr. robert moore waddell ridley, patty martin. father burr, the guy who graduated from both the prep and st. joseph's university, your trustee, and so many, many others and i want to thank you for the love the support the friendship and the engagement that we have had over so many many years. all the people who work here,

certainly the leadership, the faculty, the staff, maintenance, folks who work in the cafeterias, those who take care of this incredible urban and suburban campus, to all of you, can we please recognize the folks who make st. joseph's university the great place that it is? [ applause ] some very good friends -- i heard that hawk. jim and franny mcguire, the commitment and dedication of jim and franny and the entire mcguire family believe a quarter ofoday because it's a pretty big family. but they give so much to so many. please recognize the mcguire family. [ applause ]

for the folks who surround this five jurisdictional campus the great neighbors and friends in the winfield community and in lower marion can we recognize the neighbors who support and embrace this great campus? and of course, you can't have a great university without great students and i love the st. joe's university students. and so congratulations to all of you. thank you for having me here today and i'll just share a few thoughts with you. again, to our great president president gillispie. i know that today your last commencement ceremony here at st. joseph's university. and i want to take a moment to thank you for your many years of service in higher education and your incredible leadership at st. joseph's university over the last few years.

during your tenure, you revised st. joe's university's mission statement and set forward a new vision for the development in which our students can take pride. you have helped to build a more modern campus with the addition of the admissions center and you have championed making higher education more accessible and affidavitable through scholarship programs like the francis and sarah gillispie scholarship fund. i have called on you any number of times. you have been an active participant in the meetings that i call in philadelphia and in our suburban areas. because of your background and training i asked you and asked you and asked you, because he was very, very focused on his

work here at st. joe's, that i appeal to his call to duty and service. and you served on philadelphia's board of ethics helping to ensure that our government operates with integrity and transparency. can we please take a moment to recognize father gillispie for his many accomplishments? [ applause ] i'm so deeply honored given my history and relationship in the jesuit community and certainly here at st. joe's university to receive this doctorate of public service. i have to laugh. this is my first honorary degree and to receive it here from father gillispie, a man who has dedicated his life to bettering the lives of others through

education, he is the epitome of what we talk about -- again let us recognize father gillispie. [ applause ] i also want to recognize interim provost dr. roslyn like earth. the faculty the parents, i'll come back to you in a second. i also want to commend, and it cannot be easy. people ask me from time to time. you make a lot of speeches and go a lot of places and met a lot of people. and do you get nerve when you speak? and the answer is yes, like right now. i i would like to give you a response and reaction to our student speaker here today, amy congratulations.

to our distinguished graduates, again i want to offer you my sincerest congratulations and on behalf of a million to offer my sincere congratulations. you're helping to make our city a better place and you'll be contributing to our economy. hopefully almost all of you, if not all of you, have jobs. i look forward to receiving your tax revenues very, very soon. and so today you've achieved something quite incredible. and i want to congratulate you. to the parents to the parents, your student, your child your son, your daughter your niece your nephew, your grandson, your granddaughter, whatever your relationship may be, they have in fact accomplished something great. but they didn't do it by

themselves and all those days and all those nights and every now and then the fears and the doubts and the complaining and the wondering and the things that they've talked with you about, you have helped them every step along the way. you stood with them. you stood by them. they have a shoulder to lean on or to cry on or to ask questions and you were there for them. so i'm going to ask the graduates to please stand around for a second and give those who are behind you to congratulate them because they have been behind you every step of the way. give your family members and friends a big round of applause. [cheers and applause ] it's always slightly disruptive when i do that. and lastly, to the parents, it is -- it is my hope for you that

as your young person moves on and as they come off of campus t. is my hope for you that this might, for you, be the last time that you have to help them move somewhere. that moving thing is tough. and whether you're the first in your family to attend college or a legacy student with three generations of st. joseph graduates before you to our graduates, i know you have worked hard to make it to this point. congratulations. earlier today a thousand graduate students and night students participated in their graduation. and this afternoon 1,020 undergraduates this afternoon. what a stunning achievement by all of you. i could not be more proud. [ applause ] let me just say for one moment,

recognizing current events, in the events of this week when we talk about doing more for christ, by doing more for others we know that we suffered a tremendous tragedy here in our city just this past week. for those who lost family members, we mourn for them. and they will never be forgotten. and to the miracle of 200-plus people walking off of that train wreck, we know that magis is at work, and the fire department and the police department, in our emergency management, in our hospitals, doctors, nurses health care workers, they saved lives on tuesday night. let us recognize their great

service. [ applause ] and so now it is your time. over the last four years you've pursued your courses of study with a f echl rvent passion becoming the person that you were meant to be all along the way. and now it's time to go off into the word make your own way and achieve even more. my journey to be that man for others started on a similar day like this day 40 years ago at st. joseph's prepatory hospital at 17th and gerard, a graduate of the best class out of the prep 1975. they'll be disputes all over the place about that. as i mentioned i represented st. joseph's university during

all of my time as city council and now as your mayor. but it was my education and training at the prep that prepared me for leadership, that made me the person that i am today. and i owe everything that i've ever become to the great training that i've received, from the jesuit community and the training of st. ignatius. [ applause ] and so to all of you today this may be difficult. i know many of you will stay here in philadelphia but some may venture to other places. i can assure you, you'll come back. and other cities may catch your attention from time to time but i hope you don't forget about our great city of philadelphia. a city that's been the backdrop of your college life and welcomed you with open arms and embraced your talents. we hope that you choose to stay here and build a life that you've always wanted in the city

of brotherly love and sisterly affection, a city of philadelphia. and thanks to the recent infusion of young people, choosing philadelphia and our many great higher education institutions that are producing well-educated and highly skilled graduates, much like all of you, our city is growing. as a matter of fact, it's because of you and so many others that the city of philadelphia has experienced eight straight years of population growth with the largest percentage increase of millennial population of any major city in the united states of america. [ applause ] and so we have more people and more jobs and better opportunities than ever before. and if you're interested in a challenge, in an exciting cosmopolitan city taking its place as one of the global cities, stay right here.

as a matter of fact, philadelphia has become so well known across the country and around the world that there is one who decided that he needed to experience philadelphia for himself. he's also jesuit trained and will make a journey to the city of philadelphia. he'll bring about a million plus of his best friends with him. pope francis is coming to philadelphia in september. [ applause ] continuing to be a part of our community, help to change our city. in a way, philadelphia has already benefited from your gifts. volunteering is a tenant of the st. joseph university and as a matter of fact, about 85% of st. joseph's university graduates

are avid volunteers in so many different ways. but whether you decide to call philadelphia home or some other place, i ask that wherever you are, you continue to give back and give back and give back for we know that to whom much is given, much is required. the bible says that we all live in cities that we did not build. we drink from wells we did not dig and we take from vineyards that we did not plant. we all benefit from those who have led the way in the past and have done great things before us. we owe it to them to continue to build on that legacy. without question, you should pursue excellence in your career but don't forget that we all have an obligation to build up our neighbors, to serve our communities and to impact the world in which we live. mentor a child. clean up a park, make a difference. education must not simply teach

work, it must teach life. you are blessed to have received that kind of education right here. take comfort in knowing that st. joseph's university is prepared for your future. this institution, which aims to educate the whole person, mind body and spirit has given you the critical thinking and ethical decision-making abilities to overcome any professional or personal obstacle you may encounter. as you know, challenges are a part of adult life. hard choices are inevitable. and though you may not feel prepared to navigate these rough waters, i know for a fact that you can and you will. because you've already achieved something that unfortunately most people in the world have not done. you've earned a college degree. and so -- [ applause ] graduation speakers kind of come

and go and some people remember their graduation speaker in college and some do not. mine was gary trudow. i do remember him. whether you remember this day or not, let me assure you that i will never ever forget the honor that you have given me to have the opportunity to speak with you today. keep the magis within you and then share it with the world. congratulations, class of 2015! [cheers and applause ] coming up on c-span 3 british prime minister david

cameron takes questions in the british house of commons. after that, financial experts and former federal reserve staffers discuss monetary policy. and later the white house medal of honor ceremony for two soldiers killed during world war i. now, congressional budget officer keith hall testifies on his 2016 budget request. members ask about federal debt and the potential impact of repealing the affordable care act and downgrading the u.s. credit rating. this is two hours and ten minutes.

this hearing will come to order. i want to welcome everybody and wish everybody a good morning and thank you all for being here today for this cbo oversight hearing of the house budget committee. last month, congress passed the first balanced budget of its kind in over a decade. working together the house and senate put forth a plan that would get the nation's fiscal house in order, would grow our economy, strengthen our national economy and make government effective and accountable. last week we were reminded why this effort is so incredibly important. on friday, the commerce department announced that the economy shrank, decreased in

size. there have been three such quarter economic detraction since the it began we all hear from the administration their plans are to spend more money that we don't have, tax more money out of the pockets of hard-working american families and to build more regulatory barriers to jobs and growth. this new normal is simply unacceptable and it's why we've focused on putting forward a balanced budget with pro growth ideas to help grow american families and american businesses. today we begin taking the next steps forward by examining how congress can have a better and broader understanding of how the policies we put forward will affect our budget our economy important programs like medicare and medicaid, our national security and other critical areas of interest and concern. today's hearing will allow this committee to hear firsthand from

the very agency that assists congress in that effort, the congressional budget office. i want to welcome cbo director dr. keith hall. director hall, this is your first time hear since testifying on april 1 and we want to welcome you. you bring a tremendous amount of expertise and experience to the job and i want to thank you for agreeing to serve as director. we look forward to your testimony and the insights that you can share about how cbo works with congress and how it arrives at its conclusions and how we might improve trans parn transparency and more broadly what that means for the economic challenges facing our nation. the reports that cbo has provided to congress over the past several years has shown a steady and troubling decline in economic growth projections. cbo has consistently raised the alarm about the unsustainable fiscal unbalance in washington

and what has been lost due to an out of control increase in debt. something must be done and i appreciate the critical role that cbo has continued to play in our efforts to ensure the money that taxpayers send to washington is used responsibly and that there is transparency and oversight in all government programs. the information that cbo provides our committee and colleagues here in congress is vital to that goal and to the legislative process. having sound analysis in a timely manner that is responsive to the needs of the members of congress will help us advance real solutions. at the same time, it's obvious that congress needs a more complete and realistic understanding of the fiscal and economic impact of legislation that we consider. the work we do on behalf of our communities would be well served by knowing how certain policies might affect the broader economy, job creation, investment decisions and more. and while it's impossible to perfectly predict the outcome of everything, we can and we must do a better job of getting more

accurate projections. this doesn't mean throwing out tried practices but it means adding more tools to the toolboxes. you can barely go wrong and i encourage the budget office to be committed in the analysis whether on the macroeconomics side of the ledger or on specific sides of the interest. cbo has done tremendous work over the last 40 years thanks to its incredibly dedicated staff and i want to thank you, dr. hall, for your work for this agency and i look forward to hard-earned taxpayer dollars being spent more wiser and in an efficient and accountable manner so there is a positive impact on our economy and the lives and livelihoods of the american people. i'm pleased now to yield to mr. van hollen for the purpose of his opening statement.

>> thank you, mr. chairman. let me start by joining you and welcoming director hall to your first budget committee hearing. welcome, dr. hall. the agency that you had the congressional budget office has a well-earned reputation as a nonbiased source of information for the congress and the public. its credibility has been based on the fact that members of congress see it as an independent professional nonpartisan arbitrator analysis of important questions. and i would like to just put in the record mr. chairman a letter that the first director of the congressional budget office alice riflan wrote describing the importance of maintaining that nonpartisan

position. >> without objection. >> director hall, i know that you know that you're the caretaker of that independent nonpartisan tradition and we look forward to working with you. i think it's going to be particularly important now that congress has directed the national budget office to engage in what is commonly referred to as dynamic scoring and there are lots of concerns about how games can be played with dynamic scoring. we saw in an analysis that was released of the former chairman of the ways and means committee tax proposal how those games can be played. the tax committee did an analyses of the potential dynamic effect of that proposal and, not surprisingly, in all his public presentation, the chairman of the committee used the one that showed the most aggressive benefits in terms of

economic growth and revenue not a conclusion that had been reached by the joint tax committee. so as you embark in this area i just understand and i know you do, that it's happening in a political context of a lot of suspicion about abuse of that particular approach. the chairman opened with some comments about the state of the economy and i would just point out that according to the nonpartisan congressional budget office's analysis of the republican budget at least over the next couple of years, it would actually create a contraction. in the economy, it would generally reduce total demand for goods and services and so i believe, as i think all of us do, we need to keep the economy on the right track and that means not taking actions through the budget process and through cross that would actually slow

down economic output. we're also looking at a lot of bills coming to the floor of the house and it's important to remind members that each of these bills is based on a huge accounting gimmick which this committee on a bipartisan basis has rejected in the past and the contingency fund and war savings fund as a slush fund to try to get around the budget caps. and here's what the republican budget committee wrote a year

ago about using oco in that way. abuse of the oco cap adjustment is a back door loophole that undermines the budget process. the budget committee will exercise its oversight responsibilities with respect to the use of the oco designation in the fiscal year 2015 budget process and it will oppose increases above the levels the administration and our military commanders say are needed to carry out the operations. so that was the republican budget committee report from a year ago. apparently they have torn it up, thrown it out the window and using oco for precisely the purposes that they said a year ago would undermine the integrity of the budget process. and i do want to read a letter that was written just the other day to the chairman and ranking member of the appropriations

committee from the director of omb where he points out -- and i quote -- as the secretary is referring here to the secretary of defense, ashton carter, as the secretary and chairman of the joint chiefs have repeatedly stated funding enduring operations is harmful both to military planning and to service member morale. secretary ash carter has called this approach managerial unsound and disparaging to our force. i hope in the coming weeks we will put an end to this budget gamesmanship and approach the budget in a serious way. the president has approached in a serious way, mr. chairman. he said that we need to invest both in additional defense and national security but we also need to invest in scientific research and education. and he proposed to address this issue in a straightforward manner increasing each by about

$38 billion. unfortunately, the congress chose to take a back-door path, back door by the testimony of our republican colleagues. and that has put us in the situation where we're now kind of paddling down this river serenely when we all know there's this huge waterfall ahead. and if our republican colleagues want to keep quietly paddling towards a government shutdown, that's their choice. we hope they will join with us in preventing that from happening. thank you, mr. chairman. i think we all know that is what is happening in this appropriations exercise. the president has made it clear he's not going to support any appropriation bills based on this oco gainsmenship so we hope we can get on with the business of the country. thank you. >> thank you. mr. hall i want to thank you for your time today. the committee has received your

written statement and it will be made part of the formal hearing record. you have five minutes for your opening statement and we welcome you. >> thank you. chairman price, ranking member van hollen and members of the committee, i appreciate the opportunity to come before you today to discuss the work of the congressional budget office. we are pleased to discuss our accomplishments which we believe are substantial and also welcome feedback that you can provide about ways in which we can do our jobs better. in my short time at cbo it's become clear to me that the agency is left with a staff that is knowledgeable, highly skilled, very hardworking and dedicated to providing the best possible objective and impartial analysis to the congress. cbo has been one of the best places to work in the federal government. the congressional act of 1974 created this committee and the budget office together. cbo's work followed by the agency in concert with the

budget committees and congressional leadership. the agency's chief responsibility is to help the budget committees with the matters under their jurisdiction. also under this law cbo supports other congressional committees, particularly the appropriations ways and means and finance committees. we're committed to providing information that is objective, insightful timely and explained. also, we make no policy recommendations. instead, we strive to present fully and fairly the likely consequences of alternative proposals being committed by the congress. in response to your interest for the upcoming year we've requested the funding for three new positions that would be devoted to conducting analysis of certain legislation as specified in the certain budget resolution and analyzing the effects of health care proposals. focusing for a moment on these two topics over sell years now we have been devoting significant effort to developing analytical tools that enable us

to assess the macroeconomic effects of fiscal policies. we've included reports and will vote to further develop our capacity to conduct dynamic analysis in the upcoming year. interest in legislative proposals related to health care on behalf of the congressional leadership remain very high. for example, we continue to analyze proposals to modify the affordable care act and could lead to significant legislative activity. we're in the process of analyzing various aspects of the health care system to assess the effects of future legislation on that system and on the federal budget. on a broader scale, in carrying out our mission of serving the congress during 2015 and 2016 we'll focus on meeting three goals. the first is to provide the -- to continue to provide congress with budget and economic

information that is objective and timely. in the upcoming year we expect to provide analysis to congress that include about 20 reports presenting an assessment of developments during the current fiscal year, the outlook for the budget and the economy, analysis of the president's budget long-term budget projections and options for reducing budget deficits. we'll also produce more than 500 formal cost estimates, mostly for bills reported by committees with about ten times as many preliminary and formal cost estimates, mostly to aid committees in the drafting of legislation. we also produced about 120 score keeping tab lagss for appropriation acts and produce roughly 85 analytical reports and other publications. all of our estimates are reviewed internally for objectivity and clarity. that rigorous process involves multiple people at different levels in the organization. initially we consult with

numerous outside experts who provide a variety of subjects. the majority and minority of multiple committees in both the senate and the house and regularly consult with this committee, other committees and the congressional leadership to ensure that we're focused on the work that is of the highest priority to congress. our second goal is to continue to explain the methodology for analysis clearly. we make our work widely available to the cross and public by releasing publicly all former cost estimates and analytical reports. input from outside experts and external review will remain an important component of our transparency. also, we will continue to have our documents and related information provide explanations that go well beyond just presentations of results. in addition, cbo analysts will explain details that underline the details and staff and present their work and professional conferences. the trans pearn see in our work

is very important and advancing it is one of my prime objectives. our third goal is to continue to improve our internal management. we continue to face considerable competitive pressure in attracting and retaining the highly skilled employees that we need. more than two-thirds of the staff consist of economists and budget analysts. talented people with those background are highly sought by private companies and universities. in closing, i would like to emphasize how much we at cbo have relied on the oversight of this committee and your help in explaining and communicating to others in congress about our role and the complex federal budget process. we rely on your constructive feedback and guidance on important legislative developments and congressional priorities. we are grateful for the support and guidance you've provided throughout the 40 years of cbo's existence and look forward to continuing that relationship for many years to come. thank you. >> thank you, dr. hall. i think, regardless of our

political perspective, we want to get this economy rolling again and decrease our liability and our debt because it's that trajectory that helps growing jobs and opportunity. there are three ways, basically, to get more balance into our fiscal policy. one is to raise taxes, which our friends on the other side of the aisle want to do with great frequency. decrease spending but the real secret is growth. and i want to concentrate on growth and how we get an expanding economy and i'd like to focus on that in my time for questions. as i mentioned in my opening statement last week we received some really disappointing news about the economy. in the first quarter of this engineer year, january through march, the economy shrank. it's the third time since the end of the great recession that the economy actually retracted. i'm not aware of any other

recovery, dr. hall, that had this kind of retraction within the recovery itself. are you aware of any recovery that has this recent retraction? >> i have not. this has been a frustratingly slow recovery with respect to economic output. >> every time the economy contracts or underperforms, economists say there was a reason and in this case it's a winter that comes around every year. would you -- would you comment on why you think that the economy seems to have this fragility to it? what are the things that have related -- that have caused this fragile nature of our current economy? >> i think that's a tough question because it's been frustratingly slow. as you'll see from prior -- our prior projections and everybody's prior projections, we all expected much stronger growth than we've seen. and i say it is rather frustrating. and i think part of it really

seems to be slow productivity growth. it seems to be a big part of this. in fact, productivity sort of has a business cycle element to it. where you get maybe a little slow productivity growth at the start of a recession and then once the recovery kicks in you get fairly strong productivity growth. we just haven't seen that yet. we haven't had at all strong productivity growth. one of the ways to sort of see that is we've had this very modest output growth while we've had reasonably strong employment growth. and really, we've been lucky to get as much job growth as we've had and that's been a function of this low productivity growth. >> what i'd like folks to take a peak at is this slide projected here. these are the projections of real gdp growth for fiscal year 2015 and we're now through two complete quarters of fy 2015.

if you normalize those for the years, we'd end up with a growth rate of 1.5%, clearly not what can get this economy rolling again. so do you think that we're missing some underlying weaknesses in our economy through the customary models that cbo has? are we missing something that the forecasts are not as accurate as we'd like them to be? >> i think economic forecasting is difficult. and it's always -- it's always full of errors. it always had errors in it and there are times that it's very hard to forecast the economy and it's not just cbo. it's everybody. you know, i think i would feel like cbo was missing something if somebody else was forecasting any differently than we are but they are not. so these results are genuinely disappointing but i can't tell

you why. >> let me probe a little deeper and see -- do your models -- does an increased tax rates have a drag effect on the economy? >> yes, it does. >> and do your models account for that? >> yes, they do. >> so your models that are included in the projection for fy 2015 include the taxes through obamacare and that have been incurred because of this administration? >> yes. >> does the increase in the amount of federal regulation have a drag on the economy? >> it can. it's sort of the idea that if you have an overall level of regulation that gets too high, it can slow things. there's actually also this one thing that i think may be a little underrated with respect to some of the economic data is the evidence on job loss, how long people are out of work shows that when people lose a job during a bad economy, they stay unemployed for a much longer time period.

it's one of the things that i get concerned about, if we do things that slow job growth during bad times, it delays recovery in the labor market. >> increasing regulation can slow job growth? >> it can. >> what about uncertainty, something that is hard to model and measure but uncertainty in the market, does that have a drag on the economy? does that decrease growth? >> it seems like it probably can. there's been fairly recent research that sort of suggests that economic uncertainty has been playing a role in this. i have to say, though, that it's still not widely accepted. it's still an interesting idea. it's not sort of the conventional view quite yet but i think it's quite interesting and that could be that it's having an impact. >> are you able to place that into your modelling? >> no we are not. >> so there may be things that we are not capturing with our conventional modeling? >> that's right. >> may we have the second slide, please? this is the one that concerns me and ought to concern us all.

we are now in the worst recovery, worst recovery since world war 2 coming out of an economic down turn and the congress budget office for growth over the next ten years average growth over the next ten years given in january '12 '13, and and 2015. and every time you have a decrease in growth then what that does is increase deficit. so what are the factors that you believe that the cbo believes is contributing to this continuing downward trend of growth projections? >> well certainly we've had some growth in consumer spending. that's actually held up pretty

well, which is the really important part of this. but i think i swing back to the idea of the productivity. that productivity has not only rebounded but hasn't shown the usual sort of recovery that it has in the past. that's the most notable thing to me about this. >> and if we were to try to -- this is obviously a rate. the average rate over the last three years is 3.3% annualized. so we're a full point below, a percentage point. people say that doesn't make a difference. a percentage point adds -- we could decrease the deficit over the next ten years by $3 trillion. that's the incredible importance of growth. so one of the kinds of things that we ought to be looking at as a congress to assist and get the economy growing again?

>> well, i certainly -- i certainly believe in getting at least a credible plan on solving the federal debt problem because that is looming. that's going to continue to be a problem and that's going to continue to cause problems. it's going to have a significant effect on economic growth. and as you pointed out, i think in addition to the spending and revenues, economic growth is important. we maybe don't talk enough about that. economic growth is extremely important and it can solve a lot of issues. if you look at our long-term budget projection actually it's coming out soon, one of the things we talk about is how much a difference in productivity growth over the next 25 years makes for the budget outlook. and that's a really good indicator of the importance of economic growth. >> let me just, in my final minute here, try to put a face on all of this. if we truly have 2.3% growth or

even less over the next ten years, as opposed to our 40-year average of 3.3% growth what does that look like or feel like to the average american out there? what do they sense either is happening or isn't happening because of that decrease in growth? >> certainly one of the effects it's having is slow income growth. to get good, solid wage growth, you need a much tighter labor growth than we've had. again, that sort of shows up and even though we're having pretty strong or pretty reasonable job growth, because of the economy it's not a tight labor market. and it slows revenue and things like that. >> dr. hall, thank you. i think it's important for folks to appreciate that these are

real consequential decisions and it can have an adverse effect if we can't get the economy rolling again. i'm pleased to recognize mr. van hollen for his opening questions. >> thank you mr. chairman. there's no doubt about the fact that increased economic growth would be a very good thing. we've seen 62 consecutive months of good job growth, which is the longest sustained private sector job growth since the end of the 1990s. but obviously the more we can do to increase economic growth, the better. you're knew but i'm assuming the cbo has not changed its analysis that the republican budget proposed would actually slow down economic growth in the next couple of years. is that the case?

>> anything that slows aggregate demand in the near term could slow economic growth. >> yes. i understand that. and so -- and the republican budget slows aggregate demand, according to the congressional budget office. correct? >> that's right. so i do think it's worth emphasizing, since i thought we were all concerned about the last quarter's figures although there are powerful arguments that these have to do with some seasonal adjustments, but nevertheless, we should be concerned about anything that slows down economic growth in the short term and congressional budget office has concluded that the republican budget would slow down economic growth in the next couple of years. i understand there are other arguments with respect to long term but let's just focus on that for a moment. because it's also the case, is it not director hall, that when you're looking at growth rates in the future compared to

historical growth rates that cbo wants to anticipate that output will grow much more slowly than it did in the 1980s and '90s primarily because the labor force is expected to grow more slowly than it did then. i'm reading from a cbo document from january of this year. i'm assuming the cbo has not changed that analysis. is that right? >> that's correct. >> so one of the ways we can address the issue of an aging workforce in a way that actually boosts overall economic growth would be by implementing comprehensive immigration reform. in fact, the congressional budget office concluded before you became director that the bipartisan senate immigration reform proposal would be something that would help mitigate this aging workforce issue and boost economic growth. and has cbo changed that

analysis since you became director? >> i'm not familiar enough with that analysis to actually comment on it but i don't know that we've looked at that lately. >> well, i think it's true, we probably do all share the view that more economic growth is better so i think it's important to stick to the facts and they have concluded that the republican budget will slow down economic growth in the next couple of years and that the major reason long-term economic growth is not as high as the historical average is because people are retiring and not part of the workforce and one way to address that is through immigration reform which allows more people to come into the workforce and that would boost economic growth and reduce our long-term deficits and again that has been a conclusion reached by the nonpartisan congressional budget office. so i hope when we're really actually looking at policies,

that can impact economic growth we will focus on what the nonpartisan professionals tell us is the reality of the case. you refer to dynamic analysis. as you well know even under the previous rules the joint tax committee and cbo engaged in dynamic analysis. the difference now is the congressional budget office has come up with one score which is different than analysis right? >> right. >> and so that is where there's potential -- i think many people believe for mischief and concluding that there's more certainty in some of the cbo estimates going forward than there is in reality. what i want to ask you about is cbo's capacity to apply that

kind of analysis to the investment side of the equation because there's been a lot of focus on the tax side. with respect to the categories of the budget that relate to federal investments, for example, investment in education, the cbo assumes that additional federal investment in that -- in those areas yields half of the return of the average private sector investment with a delay of five years. is that correct? >> that is. >> and so there is no assessment currently of different kinds of investment, like investment in education versus investment in infrastructure versus investment in places like the national institutes of health. is that right? >> that's right. obviously we could do that sort of work. >> that's really what i'm asking. because if we're going to be going down this road which i think has a lot of potential

pitfalls with respect to the tax side of the equation are you, as an organization, going to be spending the time and effort to better refine your capacity to do this kind of analysis with respect to the investment side of the budget? >> we plan on improving everything. >> there also are parts of the budget that are not categorized currently as investment but still could have a positive economic effect. do you agree with that? >> i imagine so. i'm not sure what you're -- >> well, i mean there was a study done just within the last 18 months, i believe regarding medicaid spending. and that's not part of the budget currently that's categoryized as investment so

when cbo does a crude analysis of the impact of investments on growth medicaid spending is not counted and yet as there was a study that indicated that medicaid spending for children has significant feedback effects on federal revenue. found that children eligible for past medicaid expansion earned higher wages and paid more taxes as adults, enough for the federal government to recover 14 cents on every dollar by age 28 and 56 cents by age 60. so if that's accurate, that's a pretty respectable return on that federal investment. now, i know it's a new study. i know cbo has not had time to evaluate it. but my question to you is, is cbo now going to take a very broad view of those kind of programs as well in terms of the impact they might have on

positive economic growth as this particular study found with respect to medicaid spending? >> actually the goal is to look at the evidence and to apply the macroeconomic effect analysis -- the macroeconomic effect analysis on things where there is evidence of dynamic effect. so we will do that. >> i mean, this is a whole new world because while there's been a lot of analysis done, what you're being asked to do now is pinpoint a score. and i think, as you go through this exercise, you're kbggoing to need a lot more time investigating the investment side. a lot of work has been done on the tax side. a joint tax provides a dynamic analysis on all of the big tax bills that are introduced right? they already do that. we've not seen that kind of in-depth macro analysis with

respect to cbo. you have this crude measure right now for what you consider the investment side of the budget. first of all, it's crude. second of all, it leaves out all of the spending like the medicaid spending that is not categorized as investment. so i'm just letting you know because you're now charged with this important agency and you're charged with the time that you've been asked to undertake this whole new enterprise. everyone is going to be watching very carefully to make sure it's put in place and implemented in a fair balanced and mostly in an accurate way so we have an understanding of the impact on the economy. so mr. chairman thank you for this hearing. we're in the middle of these appropriation bills and we are headed right now on a trajectory that seems like we're going down toward that waterfall, toward a government shutdown. the president has put on the table a plan to address this

each in a straightforward way and we hope our colleagues will join us in finding a way to avoid the government shutdown that seems to be looming on the horizon with the coming fiscal year starting october 1st. >> thank you. mr. rokita. >> i think the chair. dr. hall, thank you for being with us today. the plan i see from the president only increases our deficits and debts and over the near and even longer term and so therefore i don't think it's a viable solution. let's focus on the debt for a minute. it's my understanding that the debt as much as we're working and have evidence to show that are deficits are decreasing because of the leadership on this committee and, more recently, throughout congress, including for the first time since 2001 that we've had a budget resolution that the debt itself is still expected to

expand, the 77% by the budget window and there after it's the red menace that some have described is becoming a tidal wave because 10,000 baby boomers are retiring into unreformed programs. there's a debt clock in my office. there's over $18 trillion. quite frankly, as much as i put that out there for my constituents to see, it's hard to understand and visualize what $18 trillion is so my first question to you is can you talk to us in terms of what this means to the individual family what an increase debt load does to our standard of living? >> first of all, let me just say that the debt level is at right now 74% of gdp. that is really high. it's only been that high once and it was after world war ii. the extraordinary circumstances

after world war ii. it is a very high level. and what is going to happen is we may have a few years where it's at that high level if the economy continues to recover. at some point, the effects of the aging population and rising health care costs are going to make that start to grow again and it's eventually going to get to an unsustainable level. and by unsustainable level we mean the ability of the u.s. government to borrow money is gone. it can disappear at some point. that would make it a really serious meltdown. we're talking about a significant drag on the economy and economic growth. we're talking about slower income growth for folks. and all of those things are there and one of the things that i think i need to point out is as soon as you start to address

this, the less you have to do to fix it because if you wait what you need to do to fix it gets more difld and more difficult. i mentioned one more thing because it relates to what you're saying. the debt has almost doubled since 2007 so our ability to deal with an economic crisis going forward is going to be really hampered with the ability to deal with it is going to be very difficult. that's a really important part of it going forward. we don't want to have another recession. >> let's talk about the fix and what fix is this, as you mentioned. do slightly reforming the programs that are driving our debt medicaid medicare social security, the interest we owe ourselves and other countries, for example that make up 67% are spent, will that do it

moving around the edges or will we need total restructuring if they are going to be available to my children, for example? >> well, we certainly need something pretty substantial and without talking about particular things we spent some time producing deficit reduction where we give you options to look at and you can get an idea for how big of a change we need in things to stop this growth in debt. and one of the things that actually isn't in here that you should keep in mind is when you look at the long-term budget outlook, one, you're at a high level, second, it's still getting worse, the trajectory part of it. so when it gets to be something like -- if it gets to be 100% of gdp in 25 years it's not only going to be 100% but getting worse, which is why i'm saying

something pretty significant needs to be done. >> you mentioned trajectory. >> yes. >> some account for debt in terms of what acceptable levels are. but you don't -- you talk in terms of trajectory. there's a difference there. >> well the notion is that, one, you don't know where a tipping point is. you don't know how big the debt needs to get before there are really serious problems. one of the things that factors into is not just the level but how believable it is for people that it's going to get under control and going to be fixed. that's what i mean by the trajectory. there's a credibility part to this. >> >> thank you. i've been listening very tentatively. it seems to me what we want to do in the opening questions here is go back to the decade when clinton was the president until the end of bush's regime when

there was an $11 trillion turnaround. you remember what the surplus was in 2000 and how we got to this deficit. and then on top of that, since you brought the subject of tax cuts up, we had huge tax cuts in 2001 and 2003. do you want to know what the quotes were during the analysis then, what this was going to mean to the economy, what -- not only was it going to mean to the economy but to the job picture. we all know what the numbers are. you saw the graphs. we've thrown more graphs at you than exist, i think. and you know what those graphs are. but take those numbers away and take those graphs away and take

what i just said. but what is dynamic analysis and dynamic scoring. i'm concerned about your position, mr. chairman and your party's decision to use dynamic scoring and that's what much of the discussion is about here or macroeconomic analysis. an official cost estimates for major legislation this type of analysis is highly unconcern. you have a low number and a high number and you can make of it whatever you wish at whatever time you wish to make of it. and it provides widely different cost estimates. we can fudge the numbers easier. for example, jct's analysis of

the proposal used two different models if you remember. came up with revenue estimates from $50 billion to 700 billion over ten years. i mean that's a -- you could drive 5500 mac trucks through that. he used the most optimistic estimate to taught the plan of reform. some models depend on actions, that future congresses will take my take to reduce the deficit. there's no guarantee what congress will or will not do in the future. a ten-year budget is a fake. you know it and i know it. i believe that, including dynamic scoring will diminish the credibility of the budget

process. so i want to start off with an easy one on the affordable care act in terms of what you said and i quickly read over your testimony here. so it's supposed to stay steady as a percentage of gdp through 2018. it's at the lowest point since president obama took office. none nonetheless, the republican budget requires each of the five health-related committees to find $1 billion in savings to reduce the deficit. by repealing the aca would add 200 billion to the deficit. that's a little dynamic analysis ourselves here. so i'm not a mathematician here by any stretch of the imagination, as you are. but, in your opinion, if we repeal the aca and replace the law with policies that save $1

billion, which i just referred to what would the budgetary impact be, dr. hall? dr. hall. >> obviously the ac analysis we did before was valid and i can tell you one of the things that will happen when we also look at the dynamic effect of this, that will reduce the deficit work a little against that at least. and with respect to dynamic analysis -- >> are you saying if we repeal the aca, we would reduce the deficit. >> the gentleman's time expired. >> i yield back my time. >> the gentleman's time expired. mr. cole is recognized. >> i appreciate the extra time yielded me. if i can, let me start with discussion about historical record of the 1990s, then i want

to get specific and pick up where mr. akita left off on the debt. you like to give credit to president clinton. if you're on our side, you remind yourselves you had a republican congress, never could have gotten it balanced with a democratic congress for sure. he had three things going for him that we don't today. first, he had peace. the soviet union was gone and we did get a peace dividend and that lasted throughout the '90s. second thing is you had baby boomers working not retiring and actually in peak earning years. finally an internet boom that nobody in washington, d.c. can take any credit for that poured revenue into the treasury in terms of capital gains. we don't have any of those three today. we are in a state of war and likely to stay in a state of

war, and we can debate that, we will be militarily spending more than we were in the '90s as percentage of budget and gdp baby boomers are going to be retiring and we know they're going to be living longer than any previous generation, so they're going to be drawing social security, using medicare longer. finally, economic booms are not predictable but we certainly don't see a growth rate anything like what we have seen in the past. we have some really unique challenges that transcend what our predecessors in the 1990s had. we don't have the favorable conditions they had to work with. we have been able to bring down the deficit in a bipartisan way. i don't think we give either side enough credit for this in the last few years. we have had obviously a little bit of deficit spending, we had a little bit of economic growth,

not anything we would like but that generates a little money, and had a fiscal cliff deal that raised federal revenue by $700 billion over a decade so that's a tax increase effectively. and those things brought that deficit down from $1.4 trillion to a little under $500 billion, 460 or 80, somewhere in that range. are those measures sufficient to budget the deficit? >> they're not. the effects of aging population and rising health care costs will be more apparent going forward, we are going to have a much harder time keeping the debt anywhere near the current level. it will be difficult to do this. >> you touched on this i don't want to we labor it with

mr. akita, what's the debt on economic growth. >> it is a dragon economic growth, puts us at risk in terms of economic policy if we have another downturn the ability to deal with that. at some point we get to a tipping point where the debt is just so high that the federal government has a hard time borrowing money, then we have a real issue. >> any way to deal with the debt without dealing directly with entitlement programs? >> we have a lot of choices for deficit reduction. obviously entitlement programs the growth of those are a big part of the growing debt in our forecast. >> this committee has put forward a couple of provocative ideas on medicare and medicine tad that would slow their growth. i know the chairman talked about social security in the past we had private discussions about the need to have a process to

address that. do you know if the administration put out any proposals on entitlement reform? >> i don't. >> how many years has this administration been in office? seventh year i think? >> that i should have been able to calculate. >> fair enough. obviously i am leading the witness if we were in a courtroom, but the point is we have a huge crisis, we know it is here. we have been around seven years, it is time to deal with it. this is an area the administration has to lead and frankly the committee has been willing, has put out ideas and i think congress is ready. i would hope, mr. chairman, and i'll close out, i would hope that the administration will take that opportunity, sit down and talk about the real long term problems we have, because they're just going to get worse. >> the time is expired. mr. mcdermott is recognized for

five minutes. >> mr. chairman. do you own a house? >> i do. >> did you pay cash for it? >> i did not. >> so you went in debt to buy that house. >> that's right. is that a common occurrence in the united states? >> it is. so we have a population that understands the idea of investment creates debt and that in the end in 30 years you'll have a house probably and you'll have some house that's probably worth quite a bit more than what you paid for it maybe already is. would that be true? >> that would. >> that would be a projection you would expect. >> yes. >> now, the idea of investment, is one i think we lost sight of in congress. republicans don't seem to want to invest any more.

and i was reading "the new york times" and couldn't believe on 22nd of april that i saw a great political leader of the conservative right had come out with a suggestion we should double the nih budget. newt gingrich. i ask unanimous consent to put his editorial in the record. >> objection. >> even as we let financing for basic scientific and medical research stagnate, government spending on health care has grown significantly. that should trouble every fiscal conservative. as a conservative myself i am skeptical of government investments. when it comes to breakthroughs that could cure not just treat, the most expensive diseases, government is unique. it alone can bring the necessary resources to bear, the federal government roughly funds one-third of all medical research, it is ultimately on the hook for cost of illnesses so does the research to try to deal with it.

it is irresponsible and short sighted, not prudent, to let financing for basic research dwindle. now, the last budget that we put out of this committee was $1.7 billion less. 14,000 less grants is what the omb suggests that is equivalent to. tell me how that spurs the economy to cut investment at the national institutes of health? just explain to me how that will spur the economy. >> you know, i don't know that we have done analysis of that sort of thing. >> can you imagine any way it would? >> well certainly there are things on the spending side that have the positive effect of

macro economic growth. >> do you think the national institutes of health over the course of the last 50 years have had a positive effect on the economy? >> i just don't know. i don't want to speak lightly of it. i really don't know. >> you're kidding you really are a politician. our senator from washington said once he was looking for a one armed economist, one that didn't say on the one hand this on the other hand that. you cannot look at what's come from the pharmaceutical industry, health care industry and all that's going on it covers 16% of gdp and you're saying the national institutes of health with all of the research they've done in aids cancer, heart disease kidney disease, none of that has been positive? >> i didn't say that. >> you said you couldn't say it

had a positive effect. the effect is without that kind of research, medicine in this country would fall behind. would be like sierra leone or bot swan a if we stop doing research. we say we're going to go forward in the next century by innovation. we are going to innovate. that means you have to do the things that innovate, that's nasa, that's nsf, that's all the places we invest money. if we stop investing money in the military, all these places where money is invested, republicans say no, we have to cut back we have to cut back, we have to cut back. if you cut this, you're cutting your own throat in my view economically. after the second world war we had the same debt as today we invested, gave free college education to every soldier who