is very important for people who do is to understand the cost of doing nothing. because sometimes opponents of health-care reform pretend as if we had this great thing going here and the obama administration was a completely up and it because i do not have enough to do. i keep on trying to explain to people that i have a war in afghanistan. we have not gotten the troops out of iraq yet. i have north korea and run -- and iran and hwn1 flu. if the health-care system is really working well, i would be happy to leave it alone. understand where we are at if we do not do anything. the cost will keep on rising.

some see it going up 8%, 9%, a 10% a year. . . years from now. your wages or incomes aren't going up that fast, which means that a bigger bite is being taken out of your paycheck even if you've got health insurance. more and employers are saying more and employers are saying very competitive atmosphere, we can't afford to do more. so what has happened if you have health insurance? your employer has done what? they have increased duckett ibblets -- duckettibles, they have increased premiums. your out of pinkosky cost has gone up 62, and they are going to keep on rising. and it is costs of medicare and medicaid are going to rise, and so our deficit will be completely out of control.

don't let people fool you with this notion that somehow the reason for our deficit has to do with, for example, the recovery act. the recovery act was designed to make sure that local school districts didn't lay off teachers, and firefighters, and police officers, and it has done its job. and it is building the kind of infrastructure that we need to be competitive in the future. but it is a tiny fraction of our long-term deficit projections. almost all of the long-term deficit projections come from increases in medicare and medicaid. so, the reason i say all this is because the costs are going to be there if we don't do anything. the testify sit will grow if we don't do anything. our debt will grow if we don't do anything. what i'm eyeing to do is figure out how do we bend the curve of costs so that we are getting more and more efficient care, higher equal care, at less cost per person. how do we eliminate the $1,000

per family that is coming out of your pockets in subsidized care, uncompensated care at hospitals that is going on right now? and if we can do that, then a, we can cover more people with the savings,. and b, we have more leverage over the insurance companies and the drug companies so that they give a better deal. that is what we are trying to do. now, i don't think that we can't add to the deficit. we should find ways to honestly pay for whatever reforms we are proposing. i already gave you an indication of how we would do it. about 2/3 of it would come from reallocating money that is currently in the system. taxpayers, you are already paying for it. this isn't pneumonia coming out of your pocket. this is money right now being spent by the federal government, but not spent wisely in a way that makes you helter. that is 2/3 of it. one third of it, because we

have to make some initial investment up front, and a lot of the savings aren't scoreable, we are going to have to raise some additional ref too new to provide insurance to families that are starting to struggle right now. think the best way for us to pay for it is capping the itemized deductions that people making over $250,000 a year, people like myself -- used to be valerie was making that, but now she is working for it is federal government, so she wouldn't be affected by this. [laughter] capping those itemized deductions, and we can raise enough money to may for a good high quality health care reform proposal that will provide health care security for everybody. as i said before, many of you may be satisfied with your health care now. what you've got to do is

project, if current trends continue, are you still going to be happy with your health care five years from now? will you have health care five years from now? a lot of people here, if you change jobs right now, but you've got a preexisting condition, and just about anything these days can be called a preexisting condition. you may have trouble signing up for health care the next time around just because you changed a job. set aside the situation where you lose a job. one of the things that we did in the recovery act was to help people with cobra. everybody knows what cobra is. that is a program that allows you to get health insurance. the problem is premiums are so high that most people when you lose your job, you could afford it. the last thing you can do is afford suddenly $1,000 or $1,500 in premiums. what we do was subsidize people being able to keep their health insurance longer, cutting those

cobra costs. i think that was the right thing to do. but we can't just do that indefinitely. we can't do patchwork piecemeal fixes through the recovery acts. what we need are permanent solutions that insure that when you lose your job or change jobs, you still have health care. every nation on earth that is as wealthy as us is able to do that. and they don't do it perfectly. that is why i say we have to find a uniquely american solution. but don't tell me that we can't get this done. for those who say you know what, this is something that is very complicated, and so we shouldn't rush into it, that is what happens in congress all the time. they have hearings. they write white papers. and then suddenly the lobbyists and it is special interests start going at it.

and next thing you know, another 10 years have gone by, and we still haven't done anything. that is not what is going to happen this time. i am going to keep on pressing until we get it done this year. [applause] >> all right, mr. president. he slipped me a note and he said right now on facebook and twitter a lot of people are talking about the proposal to tax health care benefits. for example, rob on twitter says does it really make sense, brpt, to tax me on my health care coverage? >> let me describe for you how this argument has evolved. and where i have stood on it in the past and what is being debated in congress. part of the reason that employers provide health care so most americans is because

they get a big tax exclusion. they don't pay taxes on -- and you don't pay taxes -- on the health care benefits that you receive. so it is a huge subsidy provided through the tax code for employers to provide you coverage. now, up until let's say a generation ago, this worked reasonably well. it is starting to break down because even with the tax exclusion, the cost for employers just out of pocket paying the insurers is getting more and more expensive. some people have said that what we should do is just eliminate this tax exclusion so that the federal government isn't indirectly subsidizing employers providing care, and that we could take that money and then just give everybody a tax break individually, and

then they could go out and shop for their own health care. this was essentially john mccain's proposal during it is campaign. i want to be fair to it. the idea was you eliminate the exclusion, the buildings of dollars -- the billions of dollars that come back to the treasury are given back to each person in the fortunately of a $5,000 or $7,000 tax credit, and you buy your own insurance. the thinking is each of you are going to be discriminating consumers, and you will get the west deal or overusing the system. you won't be going to doctors unnecessarily or taking drugs you don't need. you will be engaging in self- rationing. this is really the concept behind this idea. the other notion is that if you don't have your health care

tied to employers, then you are not going to be as worried about losing your health insurance if you lose your job because the money follows you as opposed to your employer. that is the concept. i opposed this during the campaign, and i opposed it for a couple of reasons. number one, if you completely eliminated the exclusion, there is no doubt that what would happen is that a lots of employers would stop providing health care. so a lot of people who currently get health care through their employer wouldn't be able to get it. the second thing, remember when i told you earlier about how if you are on your own shopping for health care, you've got no leverage with the insurance company. well, the problem is that if suddenly now you get a tax credit for $5,000 or $7,000, and you try to go buy some health insurance for your family, and it costs $14,000, you are a lot worse off than you would have been. you're out of luck. and you've got no leverage. they have got no incentive to

give you a lower price because you're on your own. the other problem is that when you're not part of a pool, the insurance companies have every incentive to make sure that if you are older or you are sicker, that they do not cover you. they want to cover the young healthy folks like mark warner. [laughter] that is who they want. but if you are older or sicker, you are more likely to be excluded from coverage, or they really jack um the rates. when you're part of a pool, then the surers say well, i guess we are -- insurers say we'll take the older sicker folks because we are getting it is younger folks at the same time. that is one of the prones i opposed the proposals because it would be taxing the health care benefits provided by employers. now, nobody at this point -- or not many folks are talking

about taxing benefits or completely eliminating the exclusion. what they are calling for now in congress is to cap the exclusion so that people who have very high-priced health care, at a certain point, they could only get a deduction up to a certain point. let's say that the average health care cost per family, a good health care plan costs $13,000. what they would say is the employer and the employee get an exclusion up to $13,000. but if you get some cadillac plan that costs $17,000, then what we are going to do is you're going to have to pay taxes on that last $4,000. the idea that is being debated in congress rights now is, is that a good way to insure people dope have these big cadillac plans, but instead have more sensible plans. and by the way, that also raises some money.

this has been offered as an also tiff way to pay for that extra one third of health care that we are not able to pay for through simply reallocating money. i think the better way to do it remains the proposal i had to cap itemized deductions. i think that is a way that we can insure that people who currently have health care represent suddenly seeing costs to go up to pay for other people's cost going down. but instead, everybody's cost can go down effectively. but this is something that is going to be debated in the house and the senate. mark warner is going to have to weigh in on it. we are all going to have to weigh in on it. my bottom line, though, is that if you have got health insurance right now, you shouldn't suddenly see your costs go up as part of health care reform. ok? good. >> mr. president, i think we are teed up for another video question. >> mr. president, as a physician, i know the cost of

defensive medicine drives costs upward. at your health care forum, you said you wanted to find out what works. in my home state of texas, i know what works. unfortunately when you recently told the a.m.a. you were opposed to capping noneconomic damages, even though a state like mine has proven that it does work. will you reaffirm your commitment to finding out what works and ask congress for its implementation? >> i want to make sure everybody understands the question here. a lot of doctors have argued, and in some cases they are justified, that their costs for medical malpractice insurance, the threat of a lawsuit if something goes wrong with a patient even if it is not their fault, is so high that not only is it increasing their out of pocket costs, but they are also

engaging this what is called defensive medicine. that they have to order five tests when one is enough just tests when one is enough just to make sure they are covered so they can say i did everything that is possible even if it is not required. the argument is that if you cap the liability that is awarded as a consequence of you being hurt in the hospital or by a doctor that that would drive down everybody's cost. now, what i have said is i did not like the idea of an artificial cap on somebody if the doctor or hospital williwaws negligent, and in some cases i have to tell you they are. -- of the hospital really is negligent.

i want to make sure that people's pain and suffering and out of pocket expenses are covered. i want to work with doctors to find ways that we can reduce their liabilities were they have not done anything wrong and where they have performed effectively. i want to see, are there ways we can reduce the constant threat of lawsuits that doctors and hospitals experience, but i think that causes defensive medicine. i have committed to working with a.m.a. to find ways to reduce these litigation costs and malpractice rates. one thing i have to dispute with a gentle man who asks me the question, he says he is from texas and we have caps and texas, so we have seen what

works. well, the fact is is that there was just recently an article in texas where they have the highest health care costs and the country. down by the border. even though they have caps there in mcallen, texas, they spend about three times as much per person -- they spend about 30% more per person than they do in el paso, texas, which is also operating under caps. what that tells me is the problem of rising costs that does not simply have to do with whether or not liability is capped. what really has to do with it is incentives that are operating in various communities. e are some places like the mayo clinic that provides outstanding care, some of the best in the world. it turns out, they provide care

much more cheaply than a lot of other health systems even though it is better care and part of the reason is they do some things that are common sense but unfortunately we do not do in the health-care system. instead of you going to your primary physician and that referring you to a specialist and then maybe you go to a third specialist, go to the hospital, they recast you, what they do at mayo clinic, when you meet with your primary physician, he calls in all of the specialists at the same time. they evaluate you, do all of the tests there, so you do not duplicate a bunch of stuff. that coordinated care drive down costs tremendously. that is the kind of common-sense approaches that we are going to have to take. one of the things that we have to do is incentivize those smart

practices, coordinating care, as opposed to what we do right now -- pay you for the more services you provide, which gives doctors and hospitals a pretty strong incentive to test you five times rather than one time. right now, we are preventing them from coordinating in a smart fashion because of the ways we reimburse. >> how about one more question from our wonderful audience? >> i think it is a girl's turn, isn't it? i think so. this young lady right here. >> hi, mr. president. i am down here in fairfax county working on a change that works. what can i do as a member of the union to help you with your referral -- with your reform

bill? >> i appreciate the question. the most important thing i think the american people can do right now is to just be informed. tell your friends, tell your neighbors to get informed about what is happening in the health- care system right now. it is very complicated and i don't expect everybody to be an expert. but i want everybody to be well enough informed that the scare tactics of those who would oppose reform do not work. when you hear of somebody saying, obama is proposing a government takeover of health care. that is an old argument that has been used for years. i just want to be clear. if you have got a health care plan that you get through your

employer or some other private plan, i want you to keep it. i actually think reforming the system is the most likely way for you to keep the health care that you got. i don't want to take it over. i think it is great that you can keep the care that you have. all i have said is that i want to make sure that those things that taxpayers are paying for, that we are getting our money's worth. i don't want to provide $177 billion in subsidies to insurance companies. i don't want to reimburse for five tests that the evidence shows that you get in one test will be better for you because that means the taxpayers are saving money and i can use that to help lower your costs or help somebody that does not have health care at all. i do think we should have plan to compete with the private plans. these private insurance companies are always telling me what a great deal they give to

the american consumer. if it is such a great deal, why are they worried about competing against the public plan? [applause] they will tell you that we are trying to take over health care. i don't want to take over health care. they tell you that we will try to rationed the system. we don't want to get between you and your doctor. what we do believe is that if there is good evidence out there that shows that the best way to treat your illness is to give you the blue bell, and instead right now you are getting prescribed the red pill costs twice as much, i think you and your doctor, having that information, are probably going to decide to go with the cheaper pill that will do a better job and save you money. that is being sensible.

whenever you start hearing these arguments about socialized medicine, government takeover, rationing, canada-style health care, what i need you to do and everybody that is watching to do is actually pay attention to the argument. don't let people scare you out of reforming a system that we know is not working. america -- one of the great things about this country, we have a system that is sometimes hard to change. congress gets kind of bogged down and part of that is because the way the constitution is designed. it has served us well because it keeps us very stable. we don't have cous and all kinds of government collapsing all the time. the disadvantage is is that sometimes it is hard for us to

make big, bold steps, but the great thing about the system is that every once in a while when we finally hit a point where things just aren't working at all, we are able to generate the political will to finally get things done. that is how we got social security. after the great depression, nobody had any protection and people started realizing we can't have a country where suddenly older americans are just on the streets. after working hard all their lives, and finally, we got social security. then people said we can't have older americans that do not have health care, and then we got medicare. this is one of those times, so don't be scared about the future. let's embrace the future. let's go after the future. if we do, i am confident we can

create a health care system that gives you a choice, allows you to keep your doctor, drives down costs, and make sure every american does not have to worry if they lose or change their jobs. that is our aim, that is our goal. thank you, everybody. [captions copyright national cable satellite corp. 2009] [captioning performed by national captioning institute]

>> you are watching public affairs programming on c-span. up next, a discussion on the future of conservatism and the republican party. after that, and look at a new pakistani opinion poll. later, a state department briefing with u.s. special representative to moslem communities. and number of state governments face budget shortfalls. on tomorrow morning's washington journal," we will speak with jon shure about the impact the economy is happening on state budgets. we will also speak with mort zuckerman and martha raddatz. after that, an update on the u.s. government's role with

edward montgomery from the white house lawn at the u.s. automobile sector. later, a federal communications commission meeting on access to high-speed internet. the fcc will also examine the recent transition to an all digital broadcasting tv signal. live coverage begins at 11:30 eastern. >> now we discussion on the future of conservatism and the republican party. we will hear from indiana gov. mitch daniels, house ranking member paul ryan, and rich lowry of "the national review." gunston -- the hudson institute hosted this event. >> ok. good morning. my name is bill schambra, and i am director of the bradley center and washington.

christa schaefer and i welcome you to the fifth annual bradley symposium, entitled "making conservatism credible again." a special welcome to our nationwide c-span audience. as are many groups represented this morning, the bradley center is a proud grantee of the blind and harry bradley foundation located in milwaukee. we are pleased to have some board members and spouses and staff with us. and my particular thanks to the bradley vice-president for this critical assistance in devising and executing this symposium. this symposium. a very young republican hill staffer named paul ryan stopped by the lion house to find out more about our civic renewal efforts in milwaukee and to announce he was going to run for the united states house of representatives in the first

congressional district down lake michigan shoreline from milwaukee. that was a noble but hopeless dream of course because the notoriously volatile first district had just fallen into democratic hands and looked tuesday that way for the foreseeable future. congressmen ryan is serving his sixth term from the first district and has emerged as a major national spokesman for market-oriented alternatives to the administration costs government focus proposals. he must be on his way shortly to a meeting of the house budget committee where he is the ranking minority member. before we introduce the rest of our program, we are pleased to welcome congressman paul ryan. >> thank you. you get to have your seat at