comey's comments before congress, and if you watch the oversight hearing, you can see the director answering a lot of questions about this, he said that they did not see any evidence of her lying to them, and that that would be illegal if secretary clinton were to have lied to the fbi while being questioned. on the question, broader question of politicians telling the truth, it's frustrating when politicians lie to the public, but making that illegal would probably cause an even greater problem, because everyone would be trying to prosecute their enemies and that might cause more chaos than it would prevent. >> from maine, democrats line, helen, good morning. >> caller: good morning. my question is about the sunlight foundation. specifically, does your group look at so-called shadow government specifically regarding i.t. contracts by the federal government with private business? it's been years since i was a federal worker, but my

experience with i.t. was that it was boondoggle after boondoggle and a tremendous waste of taxpayers' money spent on incompetent private contractors who never seem to be able to get things right. and i'm wondering if you could comment and perhaps it's better now, and what impact this has on the current sense of trust among public officials regarding their -- >> sure. so i would say the failures are just as bad or worse in terms of government contracting, i.t., healthcare.gov and the electronic records archive, expensive year-long projects that largely failed, with healthcare.gov until it was rescued, big, massive failures. what's changing is there are a number of people that have identified tractable, fixable problems with the contracting

and the i.t. contracting system, and so if you look at the u.s. digital service or at 18-f, these are new government-led groups of people that are trying to change the way the government buys technology and to change the way the government builds technology. neither of which were a major source of pride in the past often. we went to the moon, so we shouldn't have no pride. that's a technical feat in itself, but in terms of procuring i.t., it's been a terrible failure, but i would encourage you to look up 18-f or usds and see all these incredible changes people are making it possible to have government contracts for a $500 project within i.t., just trying to change utterly how the system works and prevent these billion dollar ten-year failures that have so often characterized the i.t. system with the government. >> john wonderlich, republican line, john from pennsylvania. hi. >> caller: yes, good morning. thanks for c-span, and i benefit

a lot by being a viewer, a c-span viewer, and the transparency in government, obviously, is essential to have a well informed electorate, and some of the guests that you've had have really contributed to transparency for me, so to speak. example, this gentleman sounds like he's well, but opensecrets.org with campaign contributions gives you, you know, these people are not making large donations for no reason. you recently had a guest who just recently published a book "war on cops," heather mcdonald. she's a scholar at the manhattan institute. astonishing stuff, really good. using fbi statistics that are readily available, but difficult to interpret.

and just anybody who's interested in exactly what's going on right now would benefit an enormous amount by reading heather mcdonald. you can -- she writes for the city journal in new york, and she's a scholar. >> okay. john, thank you. how often do organizations like yourself depend on a foia request to get information to spread to the public? >> we use foia very often to investigate even the foia itself, what are the number of requests you're receiving and how are you dealing with them. a lot of organizations that break original news do so because they have people that understand the freedom of information act and are able to submit sophisticated requests and then can follow up with a lawsuit if necessary. and that really demands the government's attention and lets you see things that maybe are stories that haven't been told before. >> if i'm an average person and i make a request under foia,

what's the likelihood, a, i'll get the information i want, and how long will it take me to get it? >> so, the law says it should take a maximum of maybe 20 days. the problem is, that's very rarely the case. you are more likely to get a request if your request is narrow, so i would like the calendar for this day two years ago, as opposed to i would like every e-mail that someone sent about the calendar. that's going to be a massive request and may even be unanswerable, so the narrower the request, the more likely you are to get a response. it also depends a bit on the agency. if you submit a request to the state department, you're much likely to get a response in a reasonable amount of time. same goes to the cia, who generally takes the position it shouldn't apply to them at all, they tend to fight everything. >> is there a backlog of requests? >> yes, every agency has requests, i believe. and one of the goals that the president set with the agencies is to reduce the backlog every year so we're moving forward and

not backward and that has been generally successful with some out liars. >> you are on with john wunder lick. >> with the public so focused on political correctness, i wonder how you can work between to see this holder and lynch and justice department and the way they -- the way they tray ang late -- like the irs and benghazi and it is a joke to people. and then you wonder about apathy and it is easy to look at the justice department and the whole obama administration and you cannot give them any credit other than being able to polarize this country. now donald trump has kind of raised the issues of political

correctness and you could see just the infusion of life and energy, not that it -- that the lobbyist and the street don't want because it fits into the corruption and the press who have -- msnbc sitting on one side and fox sitting on the other side. and you get the opinions that are over-run with just everybody's agenda. >> thanks, caller. >> i would say that it is easy to get frustrated and to find bad news and it is certainly the case that trust in government has decreased and polarization has increased. but i think it is also helpful to keep in mind how bad things can get. and that in a lot of countries, it is commonplace to over-throw the ruler by controlling the military or the police in the capital city, like we have questions of who is -- whose voters are unified enough and is the party going in a healthy

direction. we don't have the question of how many generals are lawyer to the president and willing to overthrow or we don't have presidents that assume office and then immediately throw the previous president and their staff in prison. in some countries, it is commonplace to throw the leader of the opposition party in jail for fake charges. so in terms of the rule of law, there are a lot of reasons to be frustrated or concerned but we still have a very orderly, reasonably representative political process that is imperfect but when you compare it against those questions, the parties fail and have their problems, but it is not a fight between the military and the church. that is another example from around the world. so i think it is helpful sometimes to keep that perspective. >> mike is from ohio. and he's on our democrats line. hi. >> good morning. people talk about hillary clinton line and barack obama. let's -- there was a show that was aired last week, i don't know, you may have seen it, it

was aired on pbs and it was called "the secret history of isis" and it was an hour-long program and my jaw just dropped when i listened to this program. the lies that came out of the bush administration, all the way from cheney, george bush all the way down to condoleezza rice and colin powell who sat in front of the u.n. and out right lied not only to the u.p. bn. to the uni states and the world. people who live in britain, they just released the iraq report, it was a long overreport -- overdue report and i talked to them over the weekend and they said it was amazing that the people in great britain point the finger at the united states because they lied to us about the intelligence given to them. there were intelligence reports that were changed. that were sent to people every day on daily briefing.

libby, cheney and they exposed valerie plain and her husband because they said there were no weapons of mass destruction in iraq. >> okay, thanks, caller. >> so the -- the report that the caller was referring to, i followed that pretty closely as well and was trying to imagine an american analog to that kind of oversight into the decision to go to war and i couldn't -- i couldn't really think of one. there is also the -- the torture report, the intelligence committee report which there has been a great deal of back and forth and struggle about whether it would be released or a summary would be released and i guess i'll go back to what i said before which is it is entirely appropriate there be big, difficult fights over when national security information should be disclosed because it is a matter of public policy and at the same time there is absolutely harm that can be caused by the kay it -- the way

is disclosed. so that is going to remain a contested question given america's role in the world and one that is probably worth a lot more of all of our attention is the question of what is public and what is overseen and is congress doing its job in terms of applying oversight to the right places. >> we live in a culture where technology rapidly changes. what does that mean for the government as they try to preserve information and make it transparent? >> one thing it means is that our expectations for what we have access to have grown dramatically. i could buy something and immediately see the charge reflected on the ledger on the internet only by myself. so everyone has that experience and expects the government to live up to it and it largely does not. so that is one thing that changes our expectations. north thing that has -- another thing that has changed is records are everywhere. everything we do leaves a trail of records that reflect every communication and every e-mail and data point that is collected so the information that the government has to deal with is

increasing exponentially and the number of people that there are to deal with it and the policies that put that information up and manage it has not kept pace. this is a growing problem that means it is a challenge. and also the places that we interact and the way that we interact is not keeping base either. so there is a story about the san francisco city council and they were using encrypted communication channels -- i don't remember the name of the telegraph or telegram, but it was an encrypted communication channel that made it outside of the reach of the freedom of information law. so how are laws going to keep pace when public officials start using encryption, that is a question. >> and on the republican line, dotty, hi, there. >> caller: my question has to do with hillary clinton. i have been hearing something in the last few days about her when she was secretary of state, they were burning information at the

end of every day. do you know anything about that? >> i saw reports about the calendars being burned. but i haven't seen much beyond that. i think it is a good question. >> matthew from michigan. grand rapids michigan, independent line. hi there. >> caller: thank you for taking my call. my question is for john and how he came to the conclusion that that hillary clinton did not lie when trey dowdy gave the line of questioning to director combi which depicted her lying under oath and that is all i have, thank you. >> so what i was retelling is director comey saying to the committee, including gowdy, that they didn't have evidence that she lied in her testimony to them. that they did not develop the kind of evidence that suggests she was misleading them in her -- when she was requested. and then there are a number of

other contexts where she may have lied but there is questions because a lot of her public statements have been misleading about the whole affair, whether they were intentionally misleading is a different question but it is clear now that the claims that she made were misleading at the time. >> a couple of other topics to ask you about while we have you here. the supreme court handed out a decision looking at the former virginia governor mcdonald and about the issue of corruption and revisit the case for us quickly and what does it mean when it comes not only to how corruption is prosecuted but also information involved in those trials and process. >> sure. so the former governor of virginia was convicted on corruption charges and that case went to the supreme court and the supreme court overturned or vacated that decision and sent it back to the courts. so what is at stake here is if someone with business before the government gives, say, $15,000

rolex or anything else of value to a public official, and then that public official does something, so there is a -- a quid pro quo, at what point is it a corrupt act that is criminal is the question and what the court said is it has to be an official act for it to be criminal and for what they did was to say the act has to be concrete. it can't be setting up a meeting because that happens all of the time. and i think the court's concern was that politics be criminalized but the worry is they made it difficult to track down criminals that are in politics. and so the ins and outs of what is an official act and when something is corrupt is something people will have to take a hard look at. and even election lawyers in their private service are having fights with each other over what it means and where the line should be drawn. and it is not an easy line to draw. because if you look at russia,

prosecution corruption -- or prosecuting corruption is not something that you can trust in -- for example in russia. it is something you do to punish your enemy. so you can't say anything that looks corrupt, you can prosecutor it. it is a line that we have to draw carefully. but in our opinion the court went too narrow and a bunch of things that anyone would say would meet a common sense definition of corruption suddenly it is not clear that you will be able to build corruption cases around them and that is what this case is about. can we draw reasonable lines around what constitutes public corruption and how politics works. >> and if i remember un aanimou in this case, did that surprise you. >> yes, it did. that they were that confident in the line they drew. and the court itself, it operates on dialogue with people with lifetime appointments who tend not to have been legislators so their job is not to represent people, their job

is to sit in a room and think big thoughts and talk to each other and in that context you don't feel you could be corrupted but in a legislator whose job it is to represent 500,000 constituents we have to worry about a legislator or a governor and the power that a governor has being corrupted by a contribution. >> matthew in georgia, republican line, you are on. >> caller: good morning. i was in the navy in the '70s and '80s and on john f. kennedy and when they threw trash off the ship and there were russian trollers that would pick up the trash and try to get information off of that. today things have changed and they try to get information through electronic ways and different things. i think we do need to guard our information. one of the questions i had for your guest is there is military

information that i don't believe the public needs to know. and i think that started so that the enemy can't see it so i think there is -- it is important for things that aren't transparent. but i believe that the transparency, that spilled over to covering people who are taking money and bribes and doing bad stuff and lying about each other. and i wandered what group or what person in our government was responsible for making that divide between this stuff can be transparent and this stuff needs to be really secret and not -- not let anybody know it until -- like nixon, his tapes weren't released until after he died. so i was wondering what person or group is responsible for making that divide of the important things that we don't need to know in -- and things that the public ought to know. >> that is a great question. so there are a lot of lines that

need to be drawn. and so one of the lines is what shouldn't be destroyed and what should be saved so that we have an accurate picture in history and that is the job of the national archives. one is what under the law needs to be disclosed as it happens or once a year. and so that is something that congress or the committees of jurisdiction are responsible or should be more responsible for determining, is making good decisions about what gets released and what doesn't. another level of agencies in the executive branch have an extraordinary amount of power to choose what to release and what not to. and that is something that often happens in the department or cabinet level where they are determining what to release and what not to. and then there is also the -- when someone submitted a foia request and the officer has to determine where there is harm and where there isn't. and as you said, make sure our secrets are appropriately

guarded so we don't create any harm. and then ultimately that decision is also able to be overseen by the courts that can disagree and order something to be disclosed. and then obviously within all of that is the press constantly hopefully pushing for more disclosure and our ability to tell stories and have a robust public debate. so the question of what gets released to the public and how is at the center of how modern government functions and i think it is right that there are a lot of different factions each pushing for their various sides. >> this is jim from missouri, democrats line. >> caller: hello. >> you already got on. james from massachusetts. republican line. hi. >> caller: good morning. thanks for taking my call. i want to ask mr. wunderlich, he mentioned that people from around the world can access the freedom of information act. and i'm just thinking of china doing that and russia and isis

and is that possible through all of these people to do that and get information on whoever they wanted to use for their benefit? >> that is a great question. i think it is possible but i'm not sure it has happened. so foreign intelligence agencies for example, i don't know of any story where a foreign intelligence agency used the foia to try to get access to something. i think that would probably make it clear what they were trying to get and that would end up revealing as much as it disclosed. so i think that that is pretty rare. but if the freedom of information act was really, really strong, then i think we would tart to have to worry about that. but because it is able to be managed and incoming requests are reviewing carefully, i don't think there is any significant risk of that happening. i think foreign powers are more likely to be trying to hack into things than to sort of publicly submit a request for what they want. >> one more call. tim from nebraska, independent

line. >> caller: yes, my name is tim chen and i was wanting to ask a question. with hillary clinton being -- like going to the court system, my question is how she be going to -- wanting to be in the presidency? would she be able to run when she's got to go through court? how is that possible? >> so there is -- nothing prevents her from being able to run if she were -- the thing that would prevent it is politics. if she were in serious legal peril, party would need to make a determination whether that is someone they want to continue with or not and that is part of why last week was news, is because any real risk of prosecution appears to be completely off the table now in

advance of the democrats convention. but that is -- that is part of why it is such a concerning situation. any time a senior politician is under investigation, but certainly the president, because the president could pardon themself, because the president controls the d.o.j. and there is supposed to be a separation but in practice can you rely on it. and this is part of why we have a system of checks and balances, to make sure that it is not just one person that is in charge of everyone else. if the president could fire every judge, for example, which happens in some countries, then we would be in a mess quickly. that is part of the beauty of the checks and balances. >> so what favors other person returning for president, as far as transparency, particularly with information. >> it is interesting, the presidential campaign has included themes about openness. i mean, donald trump has stories constantly every week that pertain to this, but i think most notably is the question of the tax returns that he's refused to disclose and congress

is considering legislation that would require it to be disclosed. for secretary clinton it is the e-mail issue that brought foia and records management and classification to the front. i think for both of them, though, now that we move into the normal campaign season past the conventions, we have to wonder to what extent there is a vision for openness in the government. and if you remember when obama ran this was a major theme on both sides, the government should be open and moving beyond what everyone felt was secretive bush years. and it remains to be seen, at least for now, whether the presidential campaigns have a theme of openness. >> one of the things in -- the main things that the sunlight foundation is the openness and the website, john wunderlich, thanks for coming on and talking about this. >> my pleasure. c-span washington journal live every day with news and policy issues that impact you. and coming up on tuesday

morning, connecticut democratic congressman jim heinz will discuss failed efforts in the house to pass gun control legislation after the two recent shootings of black men by police and the fatal shootings of five police officers by a snipens -- snipers in dallas and the effect of brexit on the economy. and scott vigil will cover legislative matters. the presidential campaign and the future of the republican party heading into the republican national convention next week. be sure to watch c-span washington journal beginning live at 7:00 eastern on tuesday morning. join the discussion. road to the white house coverage continues on thursday and friday as republicans determine the rules for next week's convention in cleveland. live coverage on c-span, the radio app and c-span.org. while the rnc platform committee meets in cleveland this week, donald trump

campaigns in indiana. watch live at 7:30 p.m. eastern on c-span 2. attorney general loretta lynch heads to capitol hill tomorrow morning to appear before the house committee. a statement from the committee chair bob goodlatte said among the issues they will talk about, quote, the disturbing politicalization of the justice department under the obama administration. we'll have that live starting at 10:00 a.m. eastern on c-span 3. now we'll watch a couple of sessions from a form on retirement savings plans. in this part, congressman jared polis of colorado and joseph crowley of new york talk about legislation they are working on. this is part of the aspen institute financial security program. there is a critical mass of you seating on on your ways to seats so i'll welcome everybody here.

i'd ida rademacher and i'm from the aspen institute and welcome to our forum. retirement savings goes automatic. looking at the key accomplishment of the pension protection act and the path forward. i want to start by first just acknowledging the collective leadership and expertise that is in the room today. and by that, i don't mean just the amazing speakers and panelists that we're about to here, i mean the people in this room, the collective wisdom and the fact that to a person, i'm looking at people who have dedicated most of their careers to creating a saving system in this country that helps american workers retire with financial security and dignity. i'm excited to launch into the overall conversation. but before i do, i just want to say that if you take one thing away, and it is imprinted on your brain, as we leave today, i hope it is this -- i hope that we can see, from what we hear

today, that building on the momentum that ten years of progress since the pension protection act has passed, that we have the collective evidence, ideas leadership and technology to really finish the agenda of creating an in collusive savings system in america that helps everybody advance and retire with dignity. that break-through, that -- i think that we can be on the verge of it we are working together and talking across lines and across industry sectors. it is more important than ever as we all know. every poll that comes out when you ask americans what is the most critical financial worry that they have in their life, they talk about retirement. they talk about anxiety in that space. and add aspen we fielded a couple of questions on a national survey last week in preparation for this forum. and two important new -- or i

would say reinforcing ideas came out of that. first nine out of ten americans think retirement issues need to be higher on the agenda that we are discussing for the election cycle and two-thirds of the people surveyed felt congress should do more to help americans save for retirement. over the course of the morning, we're going to get into this a lot more and we'll do it in three parts. first, we're going to hear from a great -- we're going to hear from some wonderful opening speakers and i'll introduce congressman polis in a minute. but the three parts of this morning are going like this. we really will take the time to reflect on what the last major reforms to our nation's retirement savings accomplished and what was left undone. second, we're going to discuss a whole set of solutions that really could, if put together and were implemented, help us get over the finish line in terms of the unfinished agenda. and third and what i'm most

excited about, we're going to talk together about what it will take to implement these ideas and others so that we do have an in collusive savings system that becomes a world standard and enables all americans to save, invest, own, and live dignified retired lives. so with that, i'm going to introduce our first speaker. and it is my pleasure to kick off with congressman jared polis who represents the second congressional district in colorado. that district doesn't actually include the aspen institute or aspen colorado but it should in the sense that he is the kind of leader that aspen really exists to support and provide resources for because his leadership is very much in the guise of public servant. but also entrepreneur. and he's worked across many sectors. i think i first start-up was in college, still in college. but that spanned along to

serving on the state board of education in colorado for six years as well before coming to congress. congressman polis is the ranking member of the help sub-committee with the house committee on education and workforce and in terms of the retirement policy conversation it is great to have leadership that is really looking at what pieces of bipartisan discussion can be moving forward. and two pieces in particular that congressman polis are working are on modernizing the way employers communicate retirement information to their employees, electronically and digitally and behavior economics tells us how important this is, helping provide that 401(k) providers illustrations of the monthly income available when people are saving with the amount of savings they have at hand. so with that i'm thrilled to invite you up congressman polis for some opening remarks for us. thank you. [ applause ]

>> well, thank you, aspen institute, for hosting such a thoughtful discussion and dialogue about an issue that is so important for our present and our future. i want to thank aspen institute for inviting me to share some thoughts and i'm grateful you've chosen the retirement issues to convene an important event around. you know, in congress we talk a lot about fiscal cliffs in different context. we face real challenges and how we can deal with our debt and how we can deal with our deficit. whether it is the automatic sequester cuts under the budget control act or bend the curve on entitlement spending and of course more and more people are talking about the enormous looming amounts of student debt that we have. and if you are a parent, you are more and more familiar with some

of the trials your kids are going through and paying the cost of college. but one issue we need to talk more about and this is a good step towards is the retirement savings gap. retirement security is absolutely critical for the overall fiscal health of our economy. and the overall well-being of our constituents across their lives. and it is just as important systemically as student debt, as the soundness of our entitlement programs, as our deficit and so many other issues deserves much more attention, because there is a lot of mismatches and problems with how we do it today. study after study shows simply that workers are not saving enough money for their retirement. and even when there is seemingly enough saved, retirees outlive their savings, a trend that we

hope continues as life spans continue to increase but one we should prepare for. the retirement savings shortfall is in excess of $14 trillion. one in five americans approaching retirement age have nothing in their private retirement savings line, completely effectively on social security. and when you look at overall statistics, the numbers are big when it comes to women and minorities so we have a real looming crisis with regard to retirement savings. that is why i'm pleased you're here to discuss these issues, yes, but more importantly to look for common sense solutions. congress has shown that congress can come together to solve problems in the retirement space and that is one of the things that we're here to observe on the 10th anniversary of the tension protaks act in 2006. and without the pension protection act the crisis that we are talking about, the state of affairs today, would likely

be far worse. and that is a -- a good thing to reflect on ten years on. automatic enrollment has had an enormous positive impact and potential impact on the retirement landscape. same thing with automatic escalation, expanding the use of target date funds has helped smooth the transition for millions of mid-career workers as they move into their preretirement years. and these actions are common sense solutions to real-world problems. but as we convene here today on the 10th anniversary of the legislation, every one of us who is here knows we need to be here because it is time to take action again. we've seen labor department grabs and statist ikz for the next generation of the private sector workers, deferred benefit plans are no longer going to be an option. at the same time, there isn't enough entitlement reform in the

world to adequately refund our retirement system through the federal government which social security was never designed to do. it is clear we have to findeno vative solutions and -- innovative and bipartisan and practical solutions and that is your job today. the group here today really has a great responsibility in the institutional knowledge to help find the solutions. i'll offer a few ideas of things i'm sure you are considering. is employers, planned sponsors wand to do the right thing and provide the tools workers need for retirement. in some cases current laws are holding back companies and workers from doing what they need to do to save for retirement. without question, for instance, congress can expand the auto enrollment safe harbor. math is no secret. savings, including employer

contribution need to be the 10% to 15% range but today they are far lower and i think there is bipartisan agreement that action should be taken to expand these safe harbors to increase contributions. congress could and should take action to expand the ability of late career workers to catch up in their contributions. we know that savings for retirement is a career-long exercise but for many workers something called life gets in the way, whether it is kids at home or trying to support them through college. as workers approach mid career to late career, there should be additional opportunities to invest in their future. we all of course know that those early investments are so much more important, so much more leverage-able because of the management of compound interest but we shouldn't discourage through policy mid and late contributions while they might be necessary to close the retirement gap.

congress could and should pass legislation to expand the use of multi-employer plans. an overwhelming majority of small businesses want the ability to provide a comfortable retirement to employees but are we giving them the tool to do so. allowing small businesses to come together and participate in meps is a bipartisan solution that should become law. there is a majority in the house and senate and i think a president who would sign a bill along the lines when it gets to his desk. in the shared economy, we're also dealing with issues of em employment. we see it in the world of franchise -- the definition of employment. and this is important because one of those suite of services that some in a shared economy or perhaps in a franchise world might want to offer employees would specifically be retirement planning offerings and plans an others, but currently because those are tied to the definition

of employment, they are, for many times of companies that want to avoid any of the gray area, near employment, they are actively prevented from offering those kinds of added value retirement information to their contract employees. those are just a few of the things that we should do with regard to access. but there is also steps forward we need to take with information, empower people to make better decisions from school age through retirement workers and savers, who need access to solid, useful financial information to help them make responsible decisions on their own. that started with k-12 financial literacy and we need to do a better job with preparing children to be life-long savers. there are school districts across the country that have implemented ideas on this front. as we know, education is very

decent rallized and there -- decentralize pd and there are kids with very little or superficial exposure to financial literacy in the k-12 years. federal government should promote the innovation through the use of federal funds for encouraging financial literacy because this is a major federal financial issue and of course while administered by school districts we have an important stake in raising the financial literacy of americans across the board. the next step when it comes to college and student debt. and when you talk to younger americans, there is no single issue more than student debt on their minds. so many of my constituents every day ask how do i pay down my debt and save for retirement at the same time? and especially as people have student debt into their 30s and 40s, it becomes awfully late to start asking that question about when can you start saving for retirement when you are still dealing with your student debt.

now tackling the student debt crisis is not going to be easy and there is no silver bullet but it will takeno vative solutions that -- innovative solutions that lower the cost of college in the first place and as well as looking at student loan programs to see how we can save borrowers money. with regard to reducing costs, programs like dual enrollment where high school students obtain college credit while in high school at no or little cost to themselves could go a long way toward reducing the cost of college. moving on the trajectory towards three-year degrees rather than four-year degrees with making sure we have the same quality standards and outcomes in place. and options like open source textbooks which are free, and licensed resources could save students thousands of dollars, the average text book costs for those of you who were recently in college or parents of college students might realize this, it

is over $2,000 a year in text book costs, after room and board and everything else. and we can do a lot to save students thousands of dollars on books through the course of their college career through open source textbooks. but the solutions start as early as high school but they don't end there. once a student graduates, they need affordable options for paying off their debt. so hopefully by taking action to reduce the costs of higher education, we can reduce that debt load. but then we also need to make sure there is affordable options for paying off that debt. one idea is one that i introduced with bipartisan bill with richard hannah last year which would set up a universal income-base payment system for student loans, currently an option. but this would ensure that students pay off an affordable percentage of the income until the loan is paid off. it would eliminate the red tape and requirements for different forms of forbearance with a very simple income-based repayment

approach. the obama administration has already made income based payment a priority and seen positive increases in repayment rates as a result by the participants in that program. my bill would make income-based payment more accessible for borrowers and help people save to buy a car or a home or, yes, for retirement, because people want to make sure that they have the confidence that they can pay off their debt in a way that is manageable for them. in a way that is predictable and that they know, according to a formula. and when the next generation matriculate through college or at least through high school and become workers, information like financial literacy and the need for it doesn't stop. and i hope that we can pass another piece of legislation that i'm honored to sponsor, the retire act that allows for plan sponsors to electronically deliver information. if you look at how younger

americans save, bank, et cetera, it is all online. that is the native environment for many american workers. the paper documents that are sent today often include only a basic outline of account balances and a few legal notices and i'm confident the innovators in this room and across the country can and will and do provide more substantial information electronically, in formats that are more comprehensible to today's savers. i should also note that unfortunately there are efforts on going that would undermine our efforts to update laws that require online disclosure. as an example of that is this very week there was an amendment officers by representative pollic that would have halted the s.e.c. move to electron lick i deliver shareholder information. that is a step in the wrong direction. i've been working closely with darrell issa to encourage across government the adoption of

electronic standards for information. i also believe we should act and pass the lifetime income disclosure act for so many savers, the retirement account is first or second largest asset they have to their name. their home and their retirement account. knowing what that number means tangibly and this is mentioned in the introduction, in terms of lifetime income, it is a very important piece of information that has a positive impact on savings. and not a piece of information that is necessarily intuitive to most americans who don't have extensi extensive financial training. so it is something that could be provided that would help americans make better and more informed decisions about their retirement. and having that information and empowering people led leads -- leads me to income. now there is many different types of investment vehicles that savers may choose.

but what is clear is that quality options are important. one of those options should be a better way to choose lifetime income products. as savers live longer, we're going to see more and more americans outliving their lump sum and it is a reasonable decision to move into those kinds of products. but it is far from the only type of product that can and will work for retirees but we want to make sure those kind of options are available for savers. now these legislative ideas are just a small portion of the ideas that i hope you have and discuss and that others have. that will help solve the retirement gap. some of the solutions i think are low-hanging fruit. they are bipartisan, they are practical and they don't have intense opposition. and i hope that we can move on those in short order. but what i'm really excited to here about are the bigger -- hear are the bigger and bolder solutions that i know are out there. it might take more work to build

a consensus around to pass all of the way into law. but are more important now than ever before. i know my colleague, representative joe crowley will be speaking with you later and he published an excellent report with many ideas about how to take steps to make sure more americans can enjoy a safe, secure and comfortable retirement. same with many private sectors participants on today's panels who have done extensive work in this area. lastly, i know that many participants here with the aspen institute have the sorts of innovative solutions that are going to be critical to solving the long-term challenges that we as an entire nation face when it comes to retirement security and certainly look forward to you sharing your thoughts and your ideas on what we do to move forward to address this retirement gap as we observe the tenth anniversary. i want to thank you for having me here today, for opening

remarks and i'm excited that you are convened around this topic and look forward to looking over the results of your deliberations. thank you. [ applause ] >> thank you so much, congressman polis. so we've now had another opportunity to hear from another congressman who has dedicate a lot of of time in office and prior -- lot of time in office and prior to coming to office looking at strong financial futures for kids and adults in the u.s. and most of you know who i'm talking about. congressman joe crowelly representing the 14th congressional district in new york. and so i will just take a minute to introduce you before you come up, congressman crowley. he is the vice chair of the democratic caucus and sits on the ways and means committee which, as most of you know, has

jurisdiction over the tax code and social security. like aspen's financial security program, congressman crowley has been a long time supporters of helping americans save, especially around children's savings accounts and has recently offered comprehensive blue print ideas in a report entitled -- building better savings, building better futures which you should check out, on the front page of his website. it comes up first. specifically on the retirement issues that we're going to hear from today. just this year congressman crowley has done three things that i want to just make a quick note about. in february, he introduced the my r.a. act which would codify the new program put out by the department of treasury into law, into statute. last month he sent a letter signed by more than 60 of your colleagues in the house calling on president obama to require that all federal contractors automatically enroll their

employees in retirement plans and if they don't have them, into an ira. and also i know that there is plans underway to introduce a pretty comprehensive, a bold idea like the ones that congressman polis was talking about around a more inclusive retirement savings concept which is going to be entitled -- the save-up act. and that is a little bit of background. congressman, i want to call you up and thank you for all you are doing to help americans save both young and old. thank you. [ applause ] >> thank you, ida, very much. i very much appreciate being here this morning. if you notice, my voice is a little bit rasp. a little bit used. but we had a very interesting week this week and i was engaged in a good portion of that so i hope you forgive me. moving from one issue of security, personal safety and security to the issue of

retirement security. so thank you, ida, once again. and thank you to the aspen institute for having me here to participate in this discussion about the state of retirement security here in the u.s. i'm pleased to join you hear for a much-needed conversation on what we are, and where we are and where we need to go as a country in terms of working towards ensuring a more secure retirement for every american. particularly in the ten years since the enactment of pension protection act. the act was the most sweeping piece of legislation since arissa and it deserves credit for making it easier for employees to participate and contribute into their own retirement. for example, we have drastic increases in both auto enrollment and auto escalation. but these victories are overshadowed by the growing number of americans who do not enjoy the promise of a secure

retirement. the fact is our nation is facing an urgent saving and retirement security crisis, one that we must address now. with too many americans not saving enough for their future, fewer private sector workers being offered pensions and a host of other challenges facing potential retirees, the dream of a secure retirement is slipping away for millions of americans. as an example to highlight this problem, half of all people going to work today in america are not offered a retirement plan from their employer. even for those who are saving, the picture doesn't get any rosier. as so many families have no savings, the median, 50th percentile, family has just $5,000 in savings today. the problem starts even in the

years before retirement. we're seeing a new generation of americans growing up with little or no savings to help them climb the economic ladder or simply weather a difficult period in their lives. this is a crisis and we must address it now before it gets really too late. but there is a small bright spot. we know that many americans know the value of savings. they want to save. they just need the right tools to help them save. our country needs a multi-prong approach to address these problems so we could create a culture of savings at every stage of a person's life. that is why i proposed an action plan to help americans build better savings, to build brighter futures. we have to put the ability to save back in the hands of america's families. the first part of my plan deals

with addressing the lack of savings and financial insecurity at the earlier days of a person's life. right now in america most working families in america lack savings and face financial insecurity as a result of that lack of savings. 44% of families are what is known as liquid asset poor. meaning they lack accessible savings to survive for three months at just the federal poverty level. families with children may face additional barriers to building savings. but saving is even more important for these families. facts show that even a small amount of family assets can have a significant impact on college success, a key driver of economic mobility. low and moderate income children

with even $500 or less save for college or are three times more likely to enroll in college and four times more likely to graduate than children with no savings at all. working with the aspen institute, i introduce legislation to create universal child savings accounts to give every child and their parents the right start for a lifetime of savings and begin real asset creation. my bill launches individual accounts for every child and provides federal seed money as a down payment into their accounts. it would also expand the child tax credit for families who save on their own for their children, giving them an in sentive to put even more -- incentive to put even more money into these accounts. this may seem like a small idea. but the data proves that if you give the tools and resources,

parents said even the lowest economic levels, they will save. in the year 2011, the city of san francisco began offering child savings accounts, expanding them to all children enrolled in public kindergarten starting in 2013. data from san francisco kindergarten to college account, that program demonstrates that families, even though of lower income, are contributing their own funds towards their child's education at a rate four times higher -- four times higher than americans of all income levels are towards -- or given the opportunity to save through 529 college savings plans. and in the five years that the san francisco program has been in existence, families have

deposited $1 million in savings, helping to build assets for participating families, proving that parents want to and will save and invest in their child's future if they are given the opportunity to do so. under my bill, when the child becomes an adult, that can use that money to pay for college, or the funds can be rolled over into a roth ira account. helping young adults with other important expenses or to just simply start a long-term savings for life, putting them on the right foot path. so these young adults will grow up with not only the real assets of savings, but also the experience and the routine of saving to help them to continue to save throughout their lives. the second prong of my action plan addresses the need of working americans with no savings at all who need to start building for their retirements,

or at least have a cushion for emergency needs. according to the federal reserve board, almost half of all americans would not be able to cover a $400 emergency without borrowing money or selling off some possession. we have millions of americans who not only have no savings for retirement, but are on the verge of poverty itself. if their car or their water heater bill or the water heater breaks down. that needs to change. that needs to change and it needs to change fast. that is why i've introduced legislation to codify, as i mentioned, the president's ira accounts, and to codify and put them into law and not simply

executive order. my ira builds a culture of savings by breaking down the traditional barriers to savings itself, such as high minimum contributions or concerns about the fluctuation of our markets, as i know many of you are concerned today. it will allow a worker to open an account with as little as $25. and it gives them the ability to make automatic payments every pay period. there are also no maintenance charges or fee as associated with these accounts. meaning every dollar -- every dollar that is invested will be returned, plus interest, to the account holder. my r.a. addressed one of the biggest savings deterrents out there. by allowing access to these funds for emergency purposes. employers, though, benefit as

well. by allowing them to provide a hassle-free, no-cost, fringe benefit to their workers. this program was recently launched. now it is our job to spread the word. we need to spread the word and we need to make it permanent. the third prong of my -- the third prong of my plan deals with addressing the retirement security crisis in america. and the data is startling. a recent gallop poll shows that half of all current workers think they will not have enough money to retire. with the decline in employer-provided pensions, retirement security has become an even greater question, a greater question mark for many americans. while many employers already offer retirement plans to employees, too many workers find

themselves falling through the gaps. the department of labor estimates that one in four americans working in full-time private-sector jobs, are not taking advantage of the employer-provided retirement plans. there are steps we can easily take to improve participation in the plans. such as increasing the use of auto enrollment, which has been shown to increase this participation rate above 90%. that is why i wrote a letter recently signed by 65 of my house colleagues asking the president to take executive action to require federal contractors to auto enroll all of their employees into retirement plans. but that is simply the low-hanging fruit. we need to help those workers who aren't even offered a retirement plan through their

employer. as stated earlier, one out of every two people going to work this morning, one of them does not have a retirement plan through his or her job. and for some, believe it or not, the picture gets even worse. for example, only 38% of worker age latinos are employed in a business with an employer-sponsored retirement plan. that is why when the house returns in july, i will introduce legislation to shake up the status quo and address this problem head-on. my bill will create universal pension accounts for those workers employed in a business with ten or more employees that do not already offer workplace retirement plans. known as save-up accounts, these pension accounts will

partially -- will be partially funded by the employer and partially funded by the employee. an employer will directly contribute 50 cents for every hour worked into the individual's save-up pension accounts for each of their workers. this 50 cents allocation would increase annually to keep up with the cost of living. aside from the employer contribution, once enrolled, employees will automatically begin contributing 3% of their pre-taxed income, which increases gradually over time. while the employee cannot opt out, the employer will continue to contribute to give their employees a solid retirement option. to help with the cost of contributing to those plans, small employers can receive a tax credit worth the value of

contributions to ten employee accounts. for a small business with fewer than 10 employees, while they are not required to contribute, this tax credit will make it financially possible for them to do so and offer this fringe benefit voluntarily. these pension accounts will work similar to what we have here in the federal level, savings plans. which are offered to federal employees, including members of congress. with government oversight, and private management, and a limited number of low-fee index fund options. and these universal pension accounts are portable. they are tied to the worker, not to the employer. also, allowing employees to change jobs without fear of putting the retirement and their future at risk.

these accounts will make a big difference to employees. at the 45 -- after 45 years of work, someone who has only been employed in a low-wage job $380,000 saved up. with these funds, paid out through a monthly annuity, providing retirees a form of guaranteed income that they can rely on. i'm only talking about a single worker. if you match that up, it doubles. when you add that to social security benefits, these workers will see a much more stable retirement picture. and that is not just good for them, it is good for everyone. that means continuing to fight to keep keep the strengthening defending social security as well.

with a large and growing surplus of over $2.8 trillion, social security will be able to pay out full benefits for years to come. in fact, the most recent report of a social security trustees projects that social security can continue to pay full benefits until at least 2034. with some modest tweaks to the program and a strong defense against drastic changes we can ensure the program will remain strong and be there for everyone for decades to come. in particular, we need to address the cap on a worker's earnings that are taxed to pay for social security. congress must also oppose changes to the cost of living

allowance for social security known as chained cpi, or as i call it, chainsaw cpi. as it cuts benefits for retirees and for veterans. but my plan is just the start of what we need to do on all these important issues. as you know at the aspen institute a policy center focused on sense solutions from experts on all sides of the political spectrum, there can be good ideas everywhere. i certainly don't have a monopoly on good ideas. i often look for guidance from my colleagues from both sides of the aisle. some of whom i know are participating in today's conversation. members like congressman ron kind, richie neal, and peat teaberry from the ways and means committee a good friend, and jared poelson we just heard

from. i'm glad we have this focus on retirement security and savings and the discussions and brainstorming have been tremendously important. but we also need to see some action. i look forward to working with you to champion the best possible ideas to ensure we can create a country where everyone is able to build better savings, to built brighter futures for themselves and for their families. and once again i just want to thank you all at the aspen institute for your wonderful work. thank you all. and enjoy a great weekend. >> more from the aspen institute's financial security program now. in this portion researchers reflect on the tenth anniversary of the pension protection act. then a look what employers, employees and congress should do to improve retirement saving in

the u.s. great. good morning, everybody. so we're going to shift gears now building on the remarks from representative poleus and representative crowley. as i just said when we began, we really want to do three things this morning. first, we want to have a conversation about what the ppa accomplished, and also what was left undone, and that's really the purpose of this part of the conversation. we're going to get in depth into -- with some really great speakers who i will introduce in a second into what's happened in the ten years since the ppa was passed, what it means for retirement security in america, what more needs to be done, and that will hopefully tee up the

rest of the day. we'll be followed by keynote remarks at 11:30 from edmund murphy, the ceo of empower retirement. thane we'll take a short break and we'll have a second panel that's going to be all about the path forward, what's the next -- what's an agenda for the next administration. so what i'm going to do, just a note on logistics, the way we'd like to do it is people are going to make brief remarks. i'll follow up with one question per person. we'll go down the row. then we'll have plenty of time for dialogue between the panel and questions and answers from the crowd. as you noted -- as you may have noted in your packets, we have longer bios, so i'm not going to go deep into people's bios here, but i will say that to have this conversation we have this incredible depth of experience between the four panelists,

many, many years of deep expertise on retirement security from the financial industry, from research, and from philanthropy. so we're excited to bring a number of different perspectives to this important conversation. we're going to start on my left with lew minsky, who is the president and ceo of the defined contribution institutional investment association. it's the second time this week i have had to say that and i'm pleased to say i didn't mess it up either time. lew helped found that organization in 2010, and he brings many, many years of deep expertise in retirement securities. so without further ado, lew. >> all right. are we on? all right. great. well, let me, first of all, thank aspen for including me. this is my second opportunity this week to join you all and

really appreciate being part of this broader conversation on retirement security. earlier this week in oregon, got to talk a little bit about the coverage gap, and i'm going to primarily focus on retirement adequacy, which was primarily addressed by ppa, but we'll talk a little bit about coverage as well. probably useful for me to give a brief description of dca. we'll go with the acronym because i don't know if i would do as well of getting the full name out. so as jeremy mentioned, we're about seven years old, and really comes from the aftermath of the ppa. so what i found following on ppa was a real emerging interest from those in the retirement savings world to -- they were

really yearning for a place to come together and talk about what we all agree on, which is that it's critical that we figure out ways to improve the retirement security of american workers, and really the existence of dciia is testament to the fact that there is this desire out there from the key players in the industry, and i think through forums like this, we can really figure out how to take the next steps forward, but let's, first, take a quick step back. i'm going to try to walk through at a very high level where we were ten years ago in the evolution of the retirement savings industry, the primary themes that we saw in the ppa,

agent least on the defined contribution side, how the dialogue has changed post-ppa, and as i said, i think the existence of dciia is testament to that. what we've learned about driving successful outcomes which i think jack will pick up on, and then i think jack will particularly pick up on how the dciia system is positioned moving forward to really survive better outcomes. and, you know, i think before i go into much more detail on that, the other thing i'll share that i've learned now at dciia after 6 1/2, almost 7 years is that you -- and i think aspen has known this for a lot longer than that, you get really smart people in a room. you get them focused on important issues, and then you get out of the way. and so we've got really, really smart people here, the right people here. we're focused on a really important issue, and so after some framing remarks, i'm going

to quickly get out of the way. so, you know, where were we ten years ago? well, you know, as i said, there was a lot of interest and passion, but maybe a lack of direction around what we could do as an industry to drive better outcomes, and ppa really did a solid job in getting people focused really in two key areas. so, you know, one, ppa did a great job in clearing a path for the use of behavioral techniques primarily around automation and driving better outcomes, and then really also set a path for how we can get participants in the system access to advice on a mass commoditized basis and also on an individual basis, and then

finally as most of you know, importantly, solved the looming concern about permanence. but i'm going to focus on the first two in where we are now post-ppa. really there are some key themes to driving retirement security that we've learned now. one, ensure that people have access to the system. i'm sure people are going to talk today about that as being an important gap left, and i share those thoughts and would be happy to share my potential solutions if we get into it, but that's clearly an open issue left. but then once people have access, we need to make sure that they utilize the system, and we've made a lot of steps forward, and i think we have a lot of opportunities to further move forward.

then once they're accessing the system, we need to make sure that savings rates are sufficient, and we clearly have tools from ppa in order to do that, and we'll talk a little bit about that. and then, finally, when people are saving at sufficient initial rates, we have to make sure that they're continually saving appropriate rates as they progress in order to meet their retirement security needs and that those savings are ultimately targeted toward appropriate institutionally priced investment structures that will get them both to and through retirement. and once we've met all those needs, then we're in pretty good shape. so where are we today? well, there are definitely a leading group of employers who

have instituted best practices and are saving -- are defaulting their employees at robust initial rates. auto escalating up to levels that are designed to get them to retirement security. some are re-enrolling people annually in default investment structures and then sweeping employees who are not participating on an annual basis, not just new hires, and for those employers what we've learned is that they're doing an amazing job at getting their workers to a level of retirement security that will get them both to and through retirement. unfortunately, we're not at a point where those practices are universal. so i think a constructive conversation is how do we get to universality or at least close

to it with the tools that we have from the ppa and the knowledge that we've developed since, and i suspect we can get pretty close, and then once we do, then it's, you know, critical that we start addressing the coverage gap and we figure out how to bring those solutions to the rest of the population that currently is uncovered. but i for one am very optimistic that we have a path forward, that we have the tools we need, and i'm going to defer now to jack, who i know has a lot of detail behind that. thank you. >> thank you, lew. so i will ask one follow-up question. as you said, right, there are a lot of tools, but practices aren't universal. so say a little bit more about why you think -- what are the primary challenges that plan sponsors are facing that are preventing greater adoption.

>> yeah. so, you know, clearly we still have a challenge to get employers comfortable and focused on the adoption of plan designs that incorporate the robust implementation of automation and focus on outcomes. we're definitely seeing significant movements in that direction, particularly in the larger employer space, but there is are some very critical headwinds. one important one is the fear of litigation. you know, we really have to do something about the -- what i view as often frivolous litigation that's out there that causes employers to really

resist their otherwise natural inclination to innovate and to focus on outcomes. i think there's also, you know, a number of misperceptions that are common out there about what is allowed or even encouraged in the current law, and there's a lot we can do to educate plan sponsors and those that advise plan sponsors, and then i'd say, finally, there's really a lack of discussion right now about the mutual benefits of retirement security, both for the employer and the employee and a real opportunity to get people to understand that those interests really are well aligned. i know dciia is getting very close to releasing a paper. i'll put a little plug in here. what's in it for plan sponsors, which really tries to focus the plan sponsor community on the fact that not only is this the right thing to do for your employees, but this is actually the right thing to do for your workforce plan and for your company, and that will be coming out soon. >> great. we look forward to seeing it. jack. so now we're going to hear from

jack vanderhei, who is the research director for the employee benefit research institute, and as many of you know he's also the director of the ibri center for research on retirement income. jack has more than 200 publications, if you can imagine that, devoted to employee benefits and insurance with a major focus on the financial aspects of private defined benefit and defined contribution retirement plans. for those of you like many of the people in the audience in the retirement space, jack has been a leading voice for many, many years, and we're delighted to have him here this morning. >> thank you, jeremy. on behalf of myself and the employee benefit research institute, i'd like to extend my appreciation as far as the opportunity to talk about such an important topic. we've been doing research on employee benefits at ibri since 1978.

we got into the defined contribution database building process back in 1996, and i think it's easy to conclude that certainly ppa and the aftermath of ppa was one of the most important developments that we've seen in our entire research. what i'd like to do today is just very quickly go over an existing research. we want to set the stage as far as what we've already seen happen with respect to automatic -- in terms of what has happened with respect to the participant behavior. going to look very quickly at participation and contributions as well as asset allocation, but before we get into that in any detail, i really want to have a huge caveat that you really should not look at any of these aspects in isolation. for example, there was a front page story in "the wall street journal" back in 2011 that ended

up making the big conclusion that ppa was bad for 401(k) plans, that basically if you look at 401(k) participants, deferral rates had gone down. well, the problem is if you're not going to look at what's going on with respect to participation at the same time you look at deferral rates, you're ignoring the fact that a lot of those people in automatic enrollment plans that admittedly have low contribution rates because of the default deferrals of maybe 3% would have had 0% had there not been an automatic enrollment provision for them, so you have to keep that in mind as you look at some of this. what i'm going to try to spend much of my time on is a study that dciia is going to be releasing in a few months that will look at how each of these components that we're going to be talking about today will impact outcomes, retirement outcomes, instead of just looking at individual snapshots

year by year. and basically if you want to be able to do something like that, you need a model that's going to be able to look at the behavior of eligible employees under different types of automatic enrollment plan designs because as lew mentioned, there's many different types of designs out there, and if you're wanting to get a comparison to how much of an improvement there has been, you're still going to have to be able to figure out what these people would have done had there not been automatic enrollment, so we're also going to look at what happened under voluntary enrollment designs. for that you have to look at job change activity. we all know that so much of the leakage is still occurring when people change jobs and basically cash out those accounts, so we have to take that into account. we also have to take into account the impact of hardship withdrawals and the impact of loan defaults. in addition to everything else, basically you need a

microsimulation model that can take into account uncertainties like uncertainties in the financial markets, and that's all going to be part of what we're going to be looking at today. very quickly, and this is from vanguard's latest report that was released earlier this month, how america saves. the two things people focus on the most are participation rates and deferral rates when it comes to automatic enrollment with a comparison against voluntary enrollment and, again, much of the action has obviously taken place for the lower income individuals. if you take a look at the individuals under $30,000 in the most recent vanguard report, you see a jump in participation rates from 29% all the way up to 82%. even for those $30,000 to $50,000, you still have almost a doubling from 53% to 90%. the other side of the coin, of course, is if you go to the right-hand side and you look at those deferral rates, the deferral rate for an automatically enrolled person

under $30,000 in the vanguard database comes in at about 3.6%, just a little bit over the 3% deferrals many of them have whereas the voluntary enrollment, people who basically got in on their own initiative and are probably being much more influenced by rates are up to 5.1%. so, again, if you look at only the right-hand side, you can come away with the kind of conclusion "the wall street journal" did back in 2011 that maybe these things aren't necessarily a great improvement, but if you look at the left side at the same time and keep in mind that you would have had a number of people otherwise having no deferrals who are now showing up at least with a 3% deferral, that goes a long way to explaining what we're going to be seeing in some of the next charts. certainly there's been a lot of conversation about what happens with asset allocation, and for

this i just want to quickly highlight some results that i co-authored a couple months ago where we went back and looked at what the asset allocation was at year end 2007 and compared that to what we had for the most recent database year end 2014. we break this down into three different age cohorts. on the left side you see the 20s, middle is the 40s, and the right side is the 60s. in each case i'm comparing what's going on in 2007 with what's going on in 2014. if you look at that red rectangle on the bottom, what you're seeing is the percentage of equity that these participants have. in fact, back in 2007, almost 1 in 5 401(k) participants in their 20s had zero, and this is all equity components put

together, direct equities, it is the balance funds, it is the target date funds, and it is company stock. 1 in 5 had nothing in the equities market. in 2014 largely because of automatic enrollment, largely because of the qdias, largely because of the shift to target date funds, you see that number has been reduced all the way to 7.7%. if you want to go to the other end to the people in the '60s and look at the green rectangle, what we find here is in the end of 2007 on the verge of the financial market collapse, you had 30% of the people in their 60s that had more than 80% of their 401(k) balance in equities. because of the glide paths that many of the people have adopted in the target date funds, that number has come down appreciably and in fact is only 22.1% now in

2014. so not only did automatic enrollment have a huge impact on contributions and participation, but because of the fact that many of these people are being put in target date funds and leaving that money alone for age-appropriate asset allocation, you've also seen a shift away from the extremes for both the young and the older participants. so what i want to do is very quickly give you a little bit of background on the model i'm about to take you through. we're very fortunate, we've had a collaborative effort with ici going back to 1996 that's given us information on extremely detailed participant information as of year end 2014, we have participant information on 27 million individuals, so we know to the penny what they're invested in, what their account balances are, their contribution, and their loan

activity. that's coming from more than 75,000 different plans and represents about $2 trillion in assets, and the database is longitudinal so we can track individuals from year to year to see how their activity changes with respect to age, wages, et cetera. what we've been able to do is a number of different simulation studies like i'm about to go through with ibri retirement projection model. we've got some results of that in the appendix if you'd like to see it, but the important point, and this is why this collaborative effort we're doing with dciia is so important, even though we've had an extraordinarily rich participant database, we've never really had the plan level data to go with it to be able to bifurcate between voluntary enrollment and automatic enrollment, for example. so we've been able to get that recently from a number of different participants -- a number of different record keepers, and what i'm about to run you through just very quickly, i just want to make sure everyone is understanding

what's going on. the model you're about to see will look at employee contribution activity as a function of many different things, demographics certainly, but also what's going on as far as the plan is concerned. different plan matching formulas will have different incentives. some will stop the incentives after 3%. some will go to 6%. some will stretch it out even further. all of that is factored into this model. just as a quick note, what i'm about to show you does not include any amounts from iras or balances from previous employers, but it does allow for job change and leakages and basically what i'm going to assume is if you're a 401(k)

participant when i see you today, that every time you change jobs you will continue working for an employer that sponsors a plan. it doesn't mean you're going to participate, but at least you will continue to be eligible. we have other versions of the model that give it more of a random version, and we also have participation and opt-out simulated on annual basis. so what i'm about to show you deals with eligible employees, okay? these are employees under voluntary employment that may very well choose not to participate. same thing with automatic enrollment, and what i'm going to focus on is the age 65 balances in 401(k) plans plus any rollover money that originated in the k plan. if you change plans, if you roll it over to an i.r.a. we're going to count it as part of this bundle. it's going to include both employee and employer contributions, and basically the numbers i'm going to show you are just simple multiples of final earnings. i'm going to take your account balance. i'm going to divide it by what you were earning right before you retired at 65 and show you the differences you're going to get between automatic enrollment and voluntary enrollment. so basically what's the best way to try to illustrate this difference?

i mean, certainly there's a lot of debate going on. just very quickly what i tried to do today to get something relatively simple and quick to show is we're going to look at improvement in simulated retirement outcomes, as i said, measured as increases in the medians of these multiples of final pay, and i'm going to break it out for you by age and by salary quartile to see whether there are differences. many people have alleged you're going to see different types of reactions among the low income versus the middle income versus the high income. and basically this is probably the single most important thing i want to focus on is if you take a look, broken out by age and by income quartile, so i have the middle 50% together under the red line. the blue line is the lowest income quartile and the green is the highest income quartile and also broken out by age.

regardless of age, regardless of income, the movement from voluntary enrollment to automatic enrollment with auto escalation is giving you at least a 15% increase at the median as you move from the voluntary enrollment to the automatic enrollment with auto escalation. now, the next steps and certainly we're going to have to be talking about ways to improve the system sometime during the course of today's conversation. certainly leakages is going to be one of the most important things to look at whether it's cash outs or job change, hardship withdrawal. remember, the hardship withdrawal will include a six-month suspension and hence the inability to get the employer match at that time and loan defaults so what i want to leave you with is the last graph is how much of a difference, again, at the median do these leakages make. it should come as no surprise to individuals that the younger you

are, the bigger the impact leakages will have, and because the low income are so much more likely to cash out their 401(k) balances at job change, also you have a bigger impact for the lowest income. so if you want to just focus very quickly, for people 25 to 29, the lowest income quartile, their median reduction relative to this optimized portfolio is about 15% reduction whereas it's about 9% for the middle 50% and about 6% for the highest income quartile. so overall we've come a long way. it certainly appears in terms of retirement outcomes, this is going to be a big improvement over where we were pre-ppa with the voluntary enrollment but there's still a lot that needs to be done and certainly leakages should be one of the

aspects we take a look at as soon as possible. thank you. >> thanks, jack. that was fantastic. [ applause ] so clearly, i mean, a quick summary of a really comprehensive presentation, a lot of great evidence that shows that auto enrollment works for those who benefit from it, of course. you pointed out leakages as a major problem. what else would you say? if you were redesigning ppa or you were there at the table, what do you see as other perhaps significant shortcomings? >> one of the problems with ppa involves a safe harbor. now, not everybody who goes automatic enrollment takes a safe harbor approach, but if you look at the safe harbor with auto escalation, there's

basically a maximum cap of 10%, and if you take a look at what the individual plans are doing, there is a huge percentage, i believe it's over 1/3, that are capping the maximum auto escalations at 10%. i don't know the political rationale behind this, but i would say especially if you're a midcareer hire and you didn't have coverage before or perhaps you inadvisedly cashed out your 401(k) on the previous job and you're now in essence starting over at age 40, 10% plus whatever you're getting from the employer match is just not going to get you where you need to be. and i think if you could somehow increase those maximum limits under auto escalation, that would be a huge improvement. plus i agree with everything lew said, that coverage has to be the primary concern in the cases where the employer is not offering something, but for those that do, they should be

allowed to escalate the employees much beyond 10%. >> thank you, jack. right now we're going to shift to kilolo. so kilolo kijakazi is an institute fellow at the urban institute. we're delighted to have her here with us today. kilolo in her capacity at the urban institute works with staff across the entire institute to develop collaborative partnerships with organizations and individuals who represent those most affected by economic and social issues. as many of you know, before she joined urban, kilolo spent many years as a program officer at the ford foundation where she focused on building economic security for working families and on incorporating the expertise of people of color in all aspects of ford's work. she's been a leading thinker on retirement issues for many years and we are delighted that she's here with us this morning. >> good morning. it's a pleasure to be here, and i also want to thank aspen for inviting me.

we've heard from our previous speakers about the progress that's been made with pension savings since the enactment of the pension protection act. i'm going to talk about who still has not been reached and also tee up remarks for the panel -- the second panel which will discuss additional solutions that are needed. my remarks are reflective of my own views and are not necessarily the position of the urban institute where i work. i'm not going to use slides, but i did provide a handout that looks like this on the table outside because i'm going to be talking about quite a few numbers, and it allows you to follow along if you would like to. the information, the table that's in the handout is taken

from the employee benefit research institute's data comparing 2006 and 2013 percentages of all workers who worked for an employer that sponsored a retirement plan. and similarly, there is a comparison for 2006 and 2013 of the percentage of all workers who participated in a plan. so before and after the enactment of the pension protection act. this includes workers who have access to plans through their employers and those who do not. the data are disaggregated in several ways to get a better sense of who has access to a plan and the extent to which different workers participate. one of the first things you'll notice is that there is generally some improvement after the enactment of the law, but that change is modest, and this

is consistent with research by my colleagues at the urban institute. automatic enrollment affects workers with employers who offer a retirement plan to which they have access. it does not affect workers who do not have access to a plan through their employer. almost 49% of all workers do not work for an employer that offers -- who sponsored a plan, so let's take a look at the disaggregated groups in the table to see what that shows. there's a difference by race and ethnicity in the percentage of workers who are employed in jobs that offer retirement plans and a difference in the rate of participation. about 55% of workers have jobs

with plans, compared to 52% of african-american, 36% of latinos, and 48% of other groups. in terms of participation, almost 45% of white workers participate compared to 39% of african-americans, 27% of latinos, and 38% of others. african-americans and latinos are less likely to have jobs where employers offer retirement plans. discrimination in the labor market results in occupational segregation that leaves them disproportionately represented in service occupations, farming, and construction. only 34% of workers in service occupations had employers with retirement plans compared with 66% of workers in professional occupations. in addition, workers of color are less likely than white workers to have earnings levels and job tenure that facilitate participation in retirement

plans. factors including employment discrimination mean that workers of color are more likely to face unemployment, have longer stints of unemployment, work in involuntary part-time jobs when they would prefer full-time jobs, and have lower wages than white workers. the table shows that part-time workers and workers with lower earnings are much less likely to have employers that sponsor retirement plans and have much lower participation rates. only 34% of workers who are employed part-time for the full year have jobs with retirement plans compared to 59% of workers with full-time jobs all year. workers participate -- i'm sorry. only 18% of part-time workers

participate compared to 52% of full-time workers. with respect to earnings, only about 34% of workers earning $10,000 to $20,000 have jobs with plans, and they have a participation rate of about 17%. by contrast, 71% of workers with earnings of $75,000 or more have jobs with plans and 67% participate. it is important to note that when workers of color and white workers have similar circumstances, they make similar choices. a study by the center on retirement research found that, and i quote, for comparably situated individuals blacks

whites and hispanics respond in a similar fashion in terms of joining a 401(k) plan and deciding how much to contribute. a study showed that african-americans and white wage salary workers with the same earnings have participation rates that are nearly the same. in fact, for workers earning $75,000 or more, the african-american rate of participation in retirement plans exceeds the rate of white workers at the same level of earnings. 73% of african-americans compared to 71% of white workers participate. and for latinos, country of birth appears to be a pearorto . latinos born in the united states had retirement plan participation rates similar to african-american and other workers of color but still lower than white workers while latino workers born in other countries had rates that were much lower.

so we've talked about race and ethnicity, occupations, full time versus part time, and earning levels. i'll talk about two other groups, and then i'll stop. women and men overall had similar rates of employment in jobs with plans and participation rates that were about the same as well. but if we look at marital status, it may give us a bit more insight about what might be happening in terms of gender differences. single workers, particularly widowed, separated, and never married workers, have substantially lower rates of employment in jobs with plans and participation rates compared to married workers. divorced workers overall -- divorced workers are a bit better off than single workers, but overall these workers could be vulnerable to economic insecurity in retirement.

and, finally, young workers. they have much lower rates of employment in jobs with plans and lower participation rates than older workers. 49% of workers who are aged 25-34 are employed in jobs with plans and 37% contribute. by contrast, 58% of workers ages 45-54 are in jobs with plans and 51% participate. given the increased importance of beginning to save at very early stages in one's career, this disparity needs to be addressed. the pension protection act is important, but not sufficient. there is a need to expand coverage for workers employed in establishments that are offering a plan or establishments that limit their eligibility to a plan.

thank you. >> thanks, kilolo. [ applause ] you've laid out some pretty important shortcomings across a number of different factors. i'm curious if you have a thought -- we'll probably get into this later in the conversation and also i'm sure it's going to be one of the things that we talk about in the second panel, but just to focus on one part of what you talked about, the sort of breakdown between full time and part time. the economy appears to be moving towards a place where many, many more workers are either not getting -- are underemployed and don't get enough hours or are the growing number of contingent workers. how do you see that playing out as we look into the future? what kind of reforms do you think are necessary to bring all of the workers who have new contingent relationships into coverage?

>> so i'm sure that the panel later on will address some of this, but clearly there is a need to reach smaller employers. i think that a lot of the part-time and contingent workers are obtaining jobs with relatively small employers who are less likely to currently offer plans. so there needs to be an encouragement or a requirement for there to be more universal coverage of all workers, and even among employers who are offering plans, they may not be providing access to some of their employees who have not had the same tenure or the -- who have part-time positions within those organizations, and so that needs to be addressed as well. >> thank you.

okay, now we're going to shift gears. we seem to be shifting gears a lot in this panel. to bring in an international perspective, we're delighted to have keith ambachtsheer who is the director emeritus of the international centre for pension management at the university of toronto. keith has been a leader globally in the pensions and investment industry for more than four decades. he's an award-winning analyst. he advises governments, industry, associations, plan sponsors and money managers on governance, finance, and other investment issues. he's also, as many of you know, the founder of kpa advisory services and cem benchmarking, which are highly respected organizations in the global pensions and investment industry. he has a lot of experience working with countries with funds around the globe. and he's going to bring some of that experience, particularly that in the launch, related to the launch of the uk's recent

n.e.s.t. program and this experiment that's going on in ontario, in the province of ontario. keith, we look forward to hearing your perspectives. thank you. >> thank you. [ inaudible ] try this. yes. okay. the other comment i was going to make was that at the border we're not non-americans, we're aliens. i qualify twice, actually. i have a dutch passport and a canadian passport, so i'm twice over an alien. so my perspective obviously is to look from the outside in, and then the question is, well, how

to best do that. i think the place to start is with the melbourne mercer global pension index, gpi. how many people here know about the global pension index? about half of you. i think it's a terrific effort because it allows us to have comparative conversations about retirement income assistance, what's good about them, what's not so good about them, and to see how we can all get better at it. the premise for this index, which was started in 2009, i actually happened to be in melbourne when it was originally launched. it was i think a very interesting and important occasion. it was put together by mercer actuary david knox in australia

and his colleagues around the world to give an international perspective. so what drives retirement income system quality? they posit three things. one is adequacy, income replacement. second criteria is sustainability, the ability of the system to not only do it now but to do it 10, 20, 30 years from now, and the third dimension is integrity. is the system actually well put together, is it being well managed, is it being well supervised, if you like? this initiative started with 14 countries in 2009. the last report was with 25 countries and this year later on there will be 27, so it keeps growing every year. the top three are denmark, netherlands, and australia. the dutch used to be on top until denmark came in. it was a devastation to the dutch to actually lose their first place. along with not being in the euro cup this year, which is another

tremendously sad event. so what's with the top three here? what does it take to get into the top three? you need a sustainable pillar, one, the government piece that actually looks at poverty issues and covers the poverty, elderly poverty aspect of retirement. second, all three countries have compulsory participation in workplace pension plans. that's number two. all three countries have strong regulatory processes that cover all workplace pension plans. public sector, private sector, union, it doesn't matter. everybody gets the same treatment. and what that means is because pillars one and two are well thought out and well run, there's little need for pillar three. and pillar three is where informational symmetry sets in,

which basically means if you leave people to figure it out for themselves or advised by advisers who aren't necessarily totally unbiased, then you get a lot of inefficiency into the retirement savings system, and they don't have these issues because of the way these three countries have organized their retirement income system. so where is the usa? out of 25, where do you think? 14. and basically you get cs in all three categories, c for is adequacy, c for sustainability, and c for integrity. you have a ways to go. we'll see how things turn out this year. so what comes out of this global pension index in terms of how you raise the bar from cs to bs, and as? one, raise the minimum pension, deal with the poverty issue,

which is really a pillar one issue. number two, mandatory pillar two with a sensible net income replacement target for middle income workers. three, minimize leakages. came up in the conversation already. and, four, income for life back ends to dc plans. in other words, don't stop at retirement. figure out how to do income for life at the back end. so that's it. that's all you have to do and you'll become an "a" country in pensions. a little bit on your closest cousins, arguably, the uk who had an interesting event overnight, and canada. by the way, uk ranks nine, canada ranks seven. we're somewhere in between the top and where you are. and what's interesting is in both countries have -- they've both taken on this question of the middle income workers without pension plans.

that's been the big thing. the uk went through a major research process in the 19 -- in the 2000s which led to legislation which effectively required all employers in the uk to offer a workplace pension plan. interestingly, offered by a private sector provider or by default n.e.s.t., the national employment savings trust, which ends up with everybody if the employer doesn't make an active decision otherwise. it's now been operating for about three years, and things are going well. it's actually unfolding as it should. what they decided to put in their system was on opt-out option for employees, and they thought the opt-out rate would be 20%. and what do you think it actually was? the ones that know can't answer. you've blown it.

6%, right? very low dropout rate. which surprised everybody by how low it was. that's very encouraging for an approach where you have auto enrollment and you don't want to go totally mandatory, you want to create this safety valve. it seems powerful to get people in and get people saving. the 7% that are dropping out are actually rational decisions, people close to retirement in higher income brackets. it makes sense. so that's interesting. now, the great white north, your neighbors to the north. we've been dealing with the same issue, middle income workers, no retirement pension plan. what are we going to do? this has been going on for ten years. and effectively, there's a group that says we already have the canada pension plan, it works very well. it's a relatively modest system. let's expand it. let's do two things, increase

the benefits, cover more income. and but we have this rule in terms of changing the cpp/qpp. quebec does its own thing on this. is that it requires 2/3 of the provinces with 2/3 of the population as well as the federal government to make any change. so that's a pretty high hurdle. so we've had a federal government for quite some time who said, no, people should figure this out themselves. so it's been a nonstarter. so ontario a few years ago, largest province, said enough already. we're going to start the orpp, the ontario retirement pension plan, because it looks like we're never going to agree federally on anything. and so that started a couple years ago. legislation was enacted last year. there's a process now in terms of actually creating the delivery organization, and then we had last monday. i don't know whether with all the news going on down here, whether you get any canadian