anymore. [laughter] >> so we've got all of those issues. and then on top of that we have the largest recession in the post-war period in '81 and 82 and 74 and 75 were very large recessions. and we were extremely concerned about disinflationary fourses and the financial dischris that came with everything. and so i thought it was entirely appropriate to provide as much stimulus as we could. we did that on the monetary policy side. we have done a tremendous number of innovative programs which is taking us to the boundary of our authorities. it's been very uncomfortable for everyone involved, but it seemed like the appropriate thing to do. and it has opened up other issues and we have somewhat willingly walked into the opening of those issues for the good of putting the economy on the best possible footing in these circumstances. and so the fiscal stimulus was another important part of that. we could all talk about various

elements of all of these programs. no one will agree on everything, but the size of the program i thought was very important. and so that just add to all of the challenges. but the challenges remain. and they need to be dealt with. they need to be dealt with by all of us. and so we have to make choices about the level of spending, how it will be funded, that it should be funded, and position ourselves going forward from a monetary policy standpoint. i understand that people might think that we face challenges. but we have our responsibilities to provide financial conditions which support sustainable growth and price stability and those are very important. and that's what we're going to be paying attention to in conjunction with everything else that is going on. .

>> alan greenspan argued that the means justify the end and the idea was to get the fiscal budget accord which was very involved with, and then with the clinton administration, convincing and talking with them about fiscal discipline and having them embrace a version that worked better until we have surpluses. i think it is interesting to finally see ben bernanke finally talking about fiscal discipline, which seems appropriate within the context of what we are

talking about. i watched the testimony in congress, and he said it was not a fiscal stimulus and the great depression was the problem. he said it was not big enough. the fed supported, as you noted, the fiscal stimulus, along with monetary stimulus in the beginning of the crisis, but is now calling on congress to think longer-term. thhow much more does it put the fed in a position to be more outspoken in perhaps the economic functions of washington at this stage of the game when you are the ones who have to deal with picking up pieces at the other end? >> the part of that that is central to the federal reserve is to understand the ramifications of fiscal policy and government spending and how it affects the workings of the u.s. economy and how that position as well or not so well the path of sustainable growth and where we are on that trajectory.

it is standard fare for us to be paying attention to the stimulative or contraction rate effects of fiscal programs as well as other programs in the international environment so we understand whether more accommodation or less accommodation should be put in place in order to keep inflation in the range is supposed to be and the economy performing. that is the normal fare. you are talking about sort of over and above those types of issues, and those are not the ones that i am embarking on with monetary policy. but the chairman of the federal reserve is very -- has very important responsibility to talk, and congress calls up the chairman and asks his opinion on a number of issues. in that context, that is entirely appropriate. >> one last question. i'm not sure if you will answer it. >> i am not sure if i should,

the were you posted. -- the way that you pose did. >> you could probably answer that as. what indicators will you be watching that signal it is time to start the axis process, first part, and the second part, how far into the exit process to you have to be before you raise interest rates? do they happen at the same time on your balance sheet? >> it is a very difficult question, in part because defining the process is so complicated. we have embarked on a series of programs that have expanded the balance sheet tremendously, a number that we cannot pay attention to every moment of the time was the asset size, about $800 billion. we are well over two trillion dollars. we have made representations that under the right circumstances that could increase upwards of three

trillion or more, given the size. it along the way, as the balance sheet increased, we were lowering the funds rate. even though was positive, we were having trouble sterilizing the amount of reserves in the system. it was hard by expanding the balance sheet, that was making choices about interest rate policy and we were not able to offset that. it was one choice ultimately once she got down to that point. -- once he got down to that point. along the way, get to the point where the economy is going along quite well and real interest rates are higher when the cost of borrowing to businesses properly should be higher and the funds rate should be positive and rising because of that, we will have already addressed the size of the balance sheet. and what that means for the normal and limitation of policy.

-- the normal implementation of policy. we can do interest on reserves, that can all help. we will be naturally working to get the balance sheet down to the right point so that we can respond to the economy the way it is necessary at that point in time. what is that will finally get us to a time when interest rates rise, i think there are a number of things, which remains the unemployment rate should be coming down, the unemployment rate should be growing at or near sustainable rates i would say at the moment, 2.5. at the moment we have to go back and look at the structures, changing a bit. it could be lower than that coming out of this. for least some time. is hard to pick a particular set of indicators, but we'll have to

be attuned to inflationary pressures and a little bit of good luck would be nice, too. these things are coming along at a point where they are consistent, not getting out of hand, so we have to make hard choices, but we will have to address that. that is the job. >> thank you very much, charlie. >> thank you very much. >> up next on c-span, a news briefing with defense secretary robert gates. then a house hearing looks at the privacy issues involved in internet advertising. later, syndicated columnist george will. [captions copyright national cable satellite corp. 2009] tomorrow night is the annual radio and television correspondents dinner in

washington, and c-span will bring you live coverage, including president obama's speech, beginning at 8:25 easter. >> how is c-span funded? >> government grants? >> donations? >> public money. >> taxes? >> how is c-span funded? 30 years ago, america's cable companies created c-span as a public service, a prohibition is -- a private business initiative, no government money. >> topics of thursday's pentagon briefing include the investigation of a battle in afghanistan last month that killed civilians and the north korean threat to fire a missile at the u.s. defense secretary robert gates and joint chiefs of staff chairman admiral mike mullen speak with reporters for 35 minutes. >> good afternoon.

first, i would like to extend my sympathies and commiserate with the secretary of state with her fractured elbow. having broken my right arm as secretary of defense and the left arm operated on, i can truthfully say i feel hurricane. -- i could feel her pain. i wish her a speedy recovery. last week i attended the nato meeting in brussels along with partners and allies who are contributing troops to afghanistan. in brussels, i was pleased to introduce general crystal to the nato defense ministers and it to our troop contributing partners. he is now on the job and in the midst of a 60-day review of operations. he brings unparalleled energy and determination, as well as substantial counterinsurgency

experience and expertise to the international military effort in afghanistan. i look forward to the results of his review, which should represent a more comprehensive and effective civil military approach. one of the key takeaways from brussels was an agreement in principle to set up a new command structure, including a new operational headquarters. i look forward to the north atlantic council's approval of a new command organization next month and to the senate's confirmation of lieutenant- general david rodriquez, who with approval, would assume command of the day to day military operations of this headquarters. another important take away from this is a commitment from nato to do everything possible to prevent civilian casualties during military operations. it is clear that we need to do much more to overcome what i believe is one of our greatest

strategic vulnerabilities. afghan people must be reassured that u.s. and nato forces are there as friends, partners, and along with afghan security partners protectors as well. with the comprehensive new civil military and diplomatic strategy, great new leadership team, i think the united states and our allies and the afghan people will be able to achieve the goal of in afghanistan that does not provide a sanctuary for al qaeda, rejects the role of the taliban, and has an elected government working to provide the needs and securities of the afghan people. with that, we would be happy to take questions. >> why has the report into the incident and afghanistan not been released? do either of you oppose its release and does the fact it has not yet been released after word

that it would be play into the idea that the united states has something to hide? >> know, first of all, we do not oppose its release, and i do not think anybody else in the administration does either. i expect the report will be released in the next day or two. we have here, this is the first major situation where there were potentially a number of civilian casualties since the new administration came into office and since the development of the new afghan-pakistan strategy. what we have been trying to do is to give our colleagues in the other agency opportunity to become familiar with this report, and then go ahead and release it. we expect it to be released in the next day or two. >> i would only add that i

thought this was important enough to review with the joint chiefs, which we just recently did it, at the beginning of this week. it is a report by it discussed with the combat commanders who are in town for one of our major conferences, and is as the secretary said a strategic vulnerability that we have to get right and we have to get the lessons from it, both understood and in bad debt -- and imbedded in our training and execution. it is also the whole area of civilian casualties' is something that we have made very clear we will review quickly. but again, there is support for releasing its, and will be out shortly. >> i made a point at the nato meeting last week that i think is important, because dealing

with this problem is not just a u.s. military challenge. somewhere between 40%, 45% of the close air support missions that are flown are flown in support of our allies and partners. it will also involve a much greater degree of integration of military operations by the general and presumably general rodriguez to avoid getting into situations as much as we possibly can involving not only our troops but the troops of the other contributing nations where we have civilian casualties' credit -- and other civilian casualties. >> what did it find? where american forces responsible in any way? >> there is responsibility. i thought the ambassador weeks

ago said that we may never know how many, and certainly as i have looked at the investigation, there are some estimates, but i agree with what he said. i do not think we will ever really know how many. there were command and control challenges, chain of command challenges, training issues that we have to address, as well as you may remember there were changes that general mccarren made in january as a result of incidents last year, and we have evolved through those changes. there are additional changes that we will clearly have to make to ensure that we do absolutely everything to make sure civilian casualties' are eliminated if possible or certainly minimize in other situations. >> does that mean mistakes were made? >> one of the things we have

been challenged with in afghanistan for a considerable time is the chain of command issue. there were some -- and we have made adjustments in that regard by changes that were made. the chain of command last year, with u.s. and the combination of the commanders level, but there are others down through the chain of command that we think we need to address as well. i know that general cristol who has seen this investigation will address those as he takes over. >> one of the reasons that the allies so readily supported the creation of this intermediate headquarters was the recognition of the need for a tactical day to day commander who had purview over all of the regional command

areas of afghanistan. to get at this chain of command issued. >> what is the status of your decisions on the tanker program. what is your reaction to the house armed services committee that putting money into the f- 22, how hard will you fight that and is that potential veto material? >> first of all, on the tanker, i am probably within a couple days of making a decision on the structure of how we're going to go about the process and who will be the acquisition of 40 and so on. -- and who will be the acquisition authority and so on. i'm still hoping we get that out midsummer or thereabouts. but respect to the house mark,

it is a big problem. i have a big problem with it. it continues the f-22 program, which is contrary to the recommendations i made to the president, and that the president sent to congress with his budget. that is why is a problem. i think describing it as a big problem suggests where ibm with it. -- where i am with it. >> currently the u.s. military is tracking a north korean ship. what are your options in terms of enforcing u.s. security council resolution 1874. are you prepared to board the ship at this time? >> without going into details, but we clearly intend to vigorously enforce the united nations security council resolution 1874 to include

options, certainly a carrot -- a pale and queried. -- a hail and querry. if a vessel like this is a query and is not allow a permissive the search in port, then the country of that port is required to inspect the vessel and to also keep the united nations informed if a vessel like this would refuse to comply. but the united nations security council resolution does not include an option for the post boarding or noncompliant boarding. -- an option for opposed boarding or noncompliant boarding. if we have a vessel that we think is in noncompliance, that

is a report that goes back to the united nations as well. >> what has made use suspicious of this ship? >> i will not go into any details at this point in time except to say it is very clear the resolution prohibits north korea from shipping these kinds of materials, the kinds of weapons that were laid out from conventional weapons up to fissile material for nuclear weapons. we expect compliance, and i have gone through the steps we would take. >> the north has said it would take any sort of interdiction as an act of war. with that prevent you from pursuing u.n. security council resolution 1874? >> i think it is important that this is a u.n. resolution, an

international commitment, not just the united states. it is a lot of countries. the north taking steps to further isolate itself, to further not comply with international guidance and regulations in the long run puts them in a more difficult position. >> dr. gates, i wondered what you thought about the reports that north korea might shoot a ballistic missile toward hawaii, if he thought there was accuracy toward that? if that was to occur, would that be a situation where the u.s. would use a missile defense system to eliminate that threat? >> we are obviously watching the situation with respect to missile launches very closely. we do have some concerns if they were to launch a missile to the

west, in the direction of hawaii. i have directed the deployment again of thad missiles to hawaii and the sbx radar has been deployed to provide support. based on my visit to fort greeley, the ground-based interceptors are in a position to take action. without telegraphing what we will do, i would just say i think we are in a good position should it become necessary to protect american territory. yes? >> mr. secretary, is there evidence and reports that mistakes or problems that you both mentioned contributed directly to the civilian casualties and does it rise to a level where there needs to be disciplinary action? >> again, without going into the specific details of this, this

was a light the fire fight -- this was a long fire fight. this was along the line of seven, eight hours. it is very intense. it was handled very well by the young captain on the ground who was in charge of it. at least in my review, i found nothing that would lead to the need to take any specific action along the lines of what you are asking. it was a tough fight. what he was mostly concerned about was defending his people. there were some injuries. there was a medevac involved in this. i thought what he did, with the capability he had, was supportive of his overall requirement at the time.

but it went from day to night, it was a complex operation, sustained, etc., and were there some issues along the lines of what i talked about that we have to adjust? absolutely, and we will do that. >> i think it is worth making the point that there should be doubt in no one's mind that we will do what is necessary to protect our troops. the question is, how do we carry out our operations in a way to minimize the need for the use of close air support? i think those are the kinds of things that general crystal will be looking at. >> there have been suggestions that close air support would be somehow in jeopardy in terms of using that capability, and i just do not see that. that has to be used carefully so it meets the standard the

secretary just described. >> are you satisfied, sir, that the air forces that were involved were sufficiently sure of their targets and that civilians would not be injured when they released their ordinance? >> yes. >> mr. secretary, i am sure both of you this week have watched the use of social networking unfold on the streets of iran. i want to ask about that. not from the standpoint of politics in iran, but social networking as a tool, given some of your previous government jobs in the information business, what do you think of this? it certainly does strike you that social networking, regardless of the mechanism, impact decision making, speed, national security, a lot of people said. it is something to be considered it these days. >> i think one of the more -- one of them may be more

significant developments -- one of the may be more significant developments in the last 20 years or so has been the advance of communications technology in the hands of average citizens around the world. there is no question that the easy availability or the easy access to western communications and media played a part in the collapse of the soviet union. and the liberation of eastern europe. it is increasingly difficult for an authoritarian government to maintain control of all the means of communication that are available to its citizens, especially -- i mean, you either have economic stagnation and backwardness, or you have modern communications, and makes the control of communications by a government extremely difficult. frankly, i think it is a huge

victory for freedom around the world because this monopoly of information is no longer in the hands of the government. >> when you look at a country like iran and the government there right now that is clearly trying to control modern communications, will they succeed? how do you think about this in terms of u.s. national security? is it something we need to take into account in this country? >> i think frankly the freedom of communication and the nature of it is a huge strategic asset for the united states. without being specific about iran, there are clearly a number of governments around the world that tried to control these communications, that try to control the internet and so on. i would just say i think their efforts, while successful in some respects, they just cannot

draw the internet -- a cannot draw the net tight enough to stop everything. if he cannot text, then you twitter. my guess it is in some of these countries, the leadership is kind of like me. they did not have a clue what is about. >> i mean this with all respect. do either of you have a facebook page? does your staff twitter for you? >> absolutely not. >> actually, i do. >> he is more technologically advanced. >> if i could take a crack at this, which is the speed issue. i think the speed of communications and information, and lots of demands, but let me talk about security, creates a flexibility and adaptability. it meets the needs for flexiby