the fight on california state budget. "washington journal" starts now. >> i can guarantee you, that when we do pass this bill, history will record the demands of the endless delay and analysts debate in the news cycle but the hard work done by members of congress to pass the bill and the fact that the people who sent us here to washington insisted upon change. that is the work we have come here to do and i look forward to working with congress and the days to head -- i had to getting the job done. thank you, everybody. >> -- host: today is wednesday, july 22. president barack obama holds a meeting with the iraqi prime minister today and then holds a prime time news conference this evening. vice-president joe biden traveling in the u.k. and in

georgia and then bernanke will testify before the senate banking committee. on capitol hill democrats continue negotiations on health care reform. in "the new york times" has the headline, defining moment for the president. how he handles the issues of the next several weeks could shape the rest of his presidency, shed light on political strength, relationship with both parties in congress and the extent he is willing to fight for his agenda. with some democrats walking over insistence that both the house and senate passed before recess the president has a tough decision, does it take a hard line demanding lawmakers that the timetable risking losing support of republicans and moderate democrats or signal flexibility allowing lawmakers to take their time and opponents the chance to marshal their case against the bill. joining us is sam youngman, white house correspondent for " of the hill" newspaper. what did you expect to hear from

the president? guest: i think a lot of what we have been hearing so far appeared quite an echo chamber -- we got back from his trip, his plan was battered and came back to see his position weakened and it has only grown more and so. tonight we will hear in prime time what we have been hearing almost every day since he got back, which is, we have been talking about delay and defeat for 40 years and this time to move this down the road. host: how active has the president been -- with members of congress to move the bill forward? guest: while he was gone the plan was battered and we heard a lot of democrats on the hill saying he needs to show more of a leadership role. since he has returned there has been almost a revolving door at the white house. i know we have been waiting outside almost every day. i think he has definitely stepped evanses -- stepped up its presence. there is a question whether he needs to make a trip to the hill to see how serious he is. but he definitely stepped up his

present. host: a couple of polls and the last week showing his approval ratings dipping a little bit, on health care in particular dipping a little bit. talk about the timing. do they have to get it done this year? guest: i think without question benefited them this year because next year is an election year. that is one reason why he was pushing hard on the august deadline to put some distance for some freshmen and moderate members to maybe take some risk on how they vote and do so with enough window of time between now and midterm elections to me give them a little cover. host: we are talking health care with sam youngman, white house correspondentt househe hill" newspaper -- white house correspondent for "the hill" newspapers. one of the key components has been the public auction. the white house has been committed to -- is that

flexible. can they negotiate a bill that doesn't have a public auction -- option plan? guest: refuses to draw hard lines to say he would veto a bill that doesn't include a public auction -- option. that is something he wants to see and his reporters on the left one to see. we have seen a number of groups who really target moderate democrats, including chairman max baucus, with advertising in their home states and districts over the last few days. so i think it is something he definitely wants, but it may be a luxury he can't afford it would keep kicking the can. host: why don't moderate democrats support the bill generally? guest: really it depends on which moderate democrat yes. first and foremost, cost. the cbo scores, it is stored

sometimes as much as $1.50 trillion. those kinds of numbers just don't sit well at home especially in the middle of the kind of recession we are facing. these are members from tricky bit shocked -- districts. it is hard to explain deficits when you come home. host: let us take our first caller. anita from panama city, florida. good morning. caller: good morning. host: do you have a question? caller: yes. i have been watching intently about the health care issue. i usually watch cnn nonstop, but i am not hearing solutions to the issue. just hearing that our president has lost ratings and this and

that and the other. i am personally disabled and on social security. i presently have medicare's -- complete by secure horizons, and we are having to call to find our own providers and getting co-payed to death. i see seniors and differently able people just being discriminated against. if i know it is happening on my side of the house, how many other insurance companies are doing it to us? i'd just ask this question. and i pray not if, not how, but when, that everyone will go

bipartisan and come up with a different -- decent plan. guest: that is the case the president has been making. it is not about the politics of the moment but a real people with real stories. in fact, we have seen the president -- the democratic national committee taking these real stories and putting them on display as sort of a campaign tactic, if you will, to put a human face on what is going on and make it bigger than the usual back and forth in washington. host: next call, from georgia. caller: good morning. everybody agrees more needs to be had. i was in washington last week and republicans and democrats, insurance brokers and companies, everybody agrees reform is needed. i think one of the main issues is, does government need to be a player or does it need to be the referee. one thing i think people are

realizing when you start looking at the details, it is great to say that something needs to be done but the details are the issues. quite frankly right now there are 1000 pages written, nobody has read it and the people who have written the legislation, most of them -- are staff people born after 1980 and none of the details have been even discussed. but the main issue is, government planned or not. does the government need to be a player or does it need to be a referee. that is my question. how can the government be a player and a referee? if that happens, who is the government going to be accountable to? guest: that is definitely a sticking point and maybe investing point in washington -- maybe the sticking point. yet more people coming to the table. you have the american medical association, the doctors, nurses, hospitals, insurance

companies, also joining the president to push it through. i can't answer whether a good public government-run option is the best way to go but i think it is really the way in this battle continues to shape up. host: gloria from wisconsin on the independent line. caller: good morning. we are hearing tons of political rhetoric regarding the proposed health care but we are hearing no facts. health care has needed reform for a long time, and i'm a retired insurance agent. the insurance companies started underwriting claims instead of the applications in 1980's or 1990's, and i can remember i saw the first claim with an underwriting question on it. as far as the rhetoric, we are hearing you are going to lose your choice of what prescription of your doctor, and so forth.

well, number one, if you are in plan d of social security you already had lost their right to choose prescriptions. number two, as far as choosing your doctor if you are in a hmo or preferred provider group, they tell you, you have to go with their doctors. why are we not getting more details of what is going into the bland and why all the rhetoric and false and formation -- information? guest: i think tradition, mostly. i do think one of the reasons we are not hearing of details or perhaps you are not hearing details is a lot of those details are still shaping up. the previous caller mentioned the devil is in the details and we see a lot of closed door meetings at the senate and house and the white house as they try to figure out exactly how to shape this up.

as for the rhetoric, i see people going with what wins. that is just a washington tradition. host: north carolina, albert? good morning. caller: good morning. i have a question. everybody calling in, like these people are blind. i don't know what's going on. the insurance companies -- people paying for private insurance. they are not paying one dime on medicare. all they are doing, skimming their money off of medicare. and they tell people is that you can't go to certain doctors, and the insurance company is doing that to throw people off the track. when you pay that high-priced money for that private insurance, and they are not paying one dime and they are skimming off of medicare. if i can't understand why people can't see into that thing.

host: do you have medicare? caller: yes, and i have blue shield/blue cross. i tell them, blue shield/blue cross is primary and my wife paid big money for that insurance. by the time you walk out the door they will turn around and change it back to medicare pays first because blue shield/blue cross, you and up with a copayment, they don't recognize it. some would say? host: are you satisfied with your health care? caller: yes, i am. i am well satisfied. people getting us out of the money, like having private insurance -- you pay all of this high price insurance for years and years and never have a wreck and every time it goes up they want to go up instead of going down. it is just for money. host: letters " -- 02, from maryland. are you there? caller: i am wondering -- how

much special interests and other groups -- most of the money going into the programs are being doubled or tripled. guest: certainly we have seen k street lobbyist companies here in town, lobbyist shops have definitely benefit from this debate as all sides are looking to get their special interest here in the legislation. if i could just mention the previous caller, he really made a good argument, i think, that the president is trying to make with the public option is increase competition to really force the private companies to offer better services for lower costs. i think the caller from north carolina i believe is making exactly that point the president was trying to make. host: we have a clip from senate minority leader mitch mcconnell and barack obama talking about health care. >> americans are eager for

health care reforms that will work costs and increase access. this is why many of us are perform -- proposing reforms that should be easy for everyone to agree on, such as reforming medical liability laws, strengthening well as an prevention programs that would encourage people to make healthy choices like quitting smoking and losing weight and addressing the needs of small business without imposing new taxes that kill jobs. the administration is taking a different approach to health care reform, and more americans learned about it, the more concerned they become. so it is good the president plans on spending a lot of his time in the days ahead distancing the administration's plan for reform because people need to know what the administration's plan is. >> they don't care who is up or down politically in washington. they care what is going on in their own lives. they don't care about the latest

line of political attack, they care whether their families will be crushed by rising premiums, whether the businesses they work for will have to cut jobs or whether their children will be saddled with debt. so i understand some will try to delay action until the special interests can kill it while others will simply focus on scoring political points. we have done that before. we can choose to follow the play book again and we will never get over the goal line and we will face greater crisis for the years to come. that is one that we can travel. or we can come together and insist this time it will be different. host: is it possible for them to come together? guest: the president is clearly trying to call for everyone to get on the table together. it is clearly not as easy as he thought it would become especially in his own -- and is on party. if you look at his public and critics -- but look at the

facts, he of super -- has supermajorities and house and senate so clearly he is having problems with his own party getting over the hump. host: on the twitter page -- guest: no. i would love to tell him, yes, there is. but just of a moving parts as it works through five committees, both houses of congress and the white house waiting in every day, i think it has become a massive -- a number of callers winning the size of the bill. you can look at the with the president -- of the with the president's -- once to contain costs, to expand insurance, he wants it for non pre-existing conditions and the public option and the also wants to rein in future cost, matching it with inflation.

but the devils are in the details. host: paul is on independent line from pennsylvania. caller: good morning. thank you for taking my call. mr. youngman, you mentioned the administration wants to put a human face on the issue. they have. somewhat one-sided. and also points out the details are still being shaped up as a lot of people have been very concerned about the lack of detail. and that's think it is true. we can't see -- i can't see them doing that in two weeks. this is a complicated problem by as you know. but i want to put a little human aspect into my comments and then i have a question and i will take to much time.

i have been a surgeon since 1978, and wanted to dispel the myth about the role as health care givers. host: what kind of a surgeon? what got i'm a urologist, i do urological surgery since 1978 and i have been on the staff of several universities, so i am very well aware of how universities practice medicine. back in 1978 when i started, people will come into the office -- they would send up to the insurance company to be paid so we were paid on the spot and for big-ticket items, surgery, we would bill the insurance company directly. now let's move ahead to where we are now. when 1990 came about, managed

care came in and insurance companies -- and public assistance came in and said, guess what, guys, this is what we will pay you. we said, well, let's get together and negotiate. there is still no negotiation. so, when people say physicians and hospitals can -- maybe hospitals can, but as a private practitioner we -- there is no way we cost you. we submit the insurance bill and they pay us whenever they pay us and there is no negotiation. i will be done very shortly. in 1978 i used to do a major survey -- surgery for prostate. when i factor in what they pay me today, medicare, i make about 15% for that surgery. -- that i used to make in 1970. in the interim, however, my overhead has gone up, my liability has gone up because of the nature of society that wants

to sue, and we have tremendous amount of defensive medicine. i used to try to order tests based on judgment, and now if i don't order a certain test, i am set up for a possible suit. there is tremendous waste for unnecessary testing. this is an 800 pound gorilla. i personally think our medical care system is the best in the world and continues to be the best. we have suburban doctors. -- super but doctors. my question is this, i listened the other day and you have the governor of delaware on and some ask a question to him about how are we going to be able to help compensate medical students coming out with $300,000 debt and there is no right off for that, they have to pay that off while they are trying to

practice and they are going to be making $120,000 a year as a primary care physician. my question is -- the other question was, somebody called in asking about tort reform. he didn't even answer the question. and president obama is not answering the question. toward reform is essential. i practice in california, the only thing that kept lawsuits down is when they put a cap on pain and suffering. guest: i was with the president in chicago a couple of weeks ago when he addressed the american medical association, and of course, we were very curious how it was going to go over given there were a number of issues that the president backs that they don't. one of those is cabbing liability judgments -- capping liability judgments. the president was warmly received right until he said he does not favor capping those results come act which point we heard quite a few boos from the audience he does not favor

capping those. he does say he supports tort reform, but clearly in this instance -- instant teammate the trial lawyers happier. i think that is your answer on that. but if you wanted to go back and look at his remarks at the ama, he does address many of the issues the caller was talking about. as for helping of medical students would student loans, i think we should do the same for journalists. host: but in the context of health care debate, is tort reform in orbit or is congress suggesting that separately? guest: i think it is a separate track. the ama has come to the table and a back to one version moving through the house. by and large they support what the president is trying to do. i think what they would probably like to see is for -- in exchange to revisit the issue. host: ken from connecticut. caller: i'm a first-time caller and glad to be here.

two comments. we spent some much each year in the senate and congress allocating spending for defense department, billions of dollars every year. they always seem to have enough money for defense. it isn't the best defense a healthy society? i believe we should have single payer health care because that is what president obama ran on in his campaign. why don't we cut to the chase instead of paying -- playing these games in washington? i hope the congress and the senators are listening right now because they are playing games and people know what they want. but polls, they never called me up and ask me. why can't we have a single payer health care for young and old people across the board, and we can protect the doctors and everyone else from and why don't we make it so that it is good

for the doctors so everyone is happy but most importantly a healthy society, because scandinavia and those countries and talking about canada and outlook that it is but if you go to those countries, the pay a little higher in their taxes but everybody has a healthier society than we do in the united states. guest: think the short answer is it is not politically feasible. there are too many horror stories about foreign countries and the single payer system, and it is a no-when issue. i might take issue with the notion that the president's ran a pledging to put at a single payer system because i don't think that is what he had in mind. he did say he was open to inviting single payer supporters to the table. i think we have actually seen him back off of that quite a bit. of the short answer is, it is not politically feasible. host: of portland, oregon. caller: hello?

host: are you there? caller: yes, i'm here. first of all, the gentleman, mr. youngman is the white house correspondent. i am not sure of the detail -- what his job per se is. it seems he is being very general in everybody's answers. i would ask to see how much detail he can give. the congress and the senate debate and house committees -- all day they go on. i don't understand that people can be labeling the president as a coward when he is a wonderful man and he wants to change everybody but a change is not changing our health care for what he wants to be, everybody

is going to pay out of their taxes, how he wants to do it. why can't he asked the world? he wanted done in two weeks -- they can put sotomayor in two weeks. health care is big for the elderly, the young, everybody who doesn't have or has health care, that he is going to change, take away their tax dollars, make a change with the doctors and patients. he is going to kill the world the way his health care is going to be just because of his deadline. host: speaking of the deadline, in "the philadelphia enquirer is a tour -- in "the philadelphia inquirer," no one wants to tell the speaker she is moving too fast and a damn sure don't want

to tell the president, representative charles rangel told a fellow lawmaker as they walked into a closed-door meeting and a remark was overheard. is he being too ambitious? guest: i think so. we heard as the present a spoke in the last few days, it has been a glaring omission that he hasn't mentioned the august deadline anymore. i think realistically it has become so the goal to make the deadline. it is the one -- one of the few areas where republicans really found attraction as far as messaging. so what's the rush? we heard leader mitch mcconnell say several times it is not that we don't want to do it, we just want to do it right. when you talk about the astronomical dollar figures from the two weeks doesn't see it politically impossible. host: manhattan, independent line. caller: thank you for giving me this opportunity. i'm a registered nurse myself and i have been involved in quality management, as far as

getting endorsement -- reimbursement from insurance companies to pay for the patients who are insured. i have been watching this happen and i am in agreement that we need health care reform. i voted obama, one of the things that is really bothering me and has from the get go is the minute he got in office, he put larry summers in charge of the treasury. he is a neo con, then he put in timothy geithner, wall street's hawk and then mr. peter orszag in charge of the government -- budget. larry summers, i saw recently yesterday on c-span, and mr. or zack also have targeted medicaid and medicare to be cut back, i am saying. not once have i ever talked about the outrageous profits made by corporate hospital chains and insurance companies.

i was listening to bernie sanders of vermont, and i think he got it right. and i think the american people is what should fly. not what is politically feasible. what is politically feasible is what the american people want and i think they made it pretty clear that they want some form of socialized health care, because of they don't go bankrupt -- because of the bill go bankrupt. guest: i don't know from the poll i am looking at that there is a clear consensus people want socialized health care. i think socialized health-care is the most awful thing the white house would want it to be called. as far as larry summers and director or sag and secretary geithner go, i know a lot share their view but i also know they continue to ensure the confidence of the president. host: tim on the democratic line from iowa. caller: good morning. thank you for taking my call.

five point is on the insurance companies -- now, i have been working both independently and for companies on and off for 20 years. i have been paying premiums anywhere from $250 all the way up to $500 per month for a family plan. i feel and think a lot of people feel is the insurance companies, what do they do is pull people -- pull money together and pay our medical compensation? we feel they really don't add any benefit to society. they are not making anything, it producing anything, other than administrative functions in society. why should they be making $250 billion profits when companies that are really adding benefits to society are not making anywhere near that. my question is, why can we not

just regulate the insurance companies rather than having to make a home system? guest: i think this caller is making the president's case of a public auction -- option, saying -- republicans saying it would drive people off the private plans which runs counter to the presidents pledge that if you like your insurance plan and that you can keep it. but the president says the public option would force the insurance companies to offer a better product at a more reasonable cost. i think we will probably see more regulation in terms of simplifying the forms, and everything gets assigned basically every time you go to the hospital or doctor. but i think this caller calling from the democratic line is making the president's case for the public option. host: republican line. steve from pennsylvania. caller: mr. youngman -- i know you're trying to make a case for

president obama's health care plan but there are other issues you are not bringing up, people saying they want back but -- people are going to be paying more. i pay for part of my insurance out of my paycheck. that is going to go out for me and my employer. i think toward reform is a big thing that needs to be put in nationwide. hospitals. for instance, i had mri on my shoulder, i get a call and they did the wrong part. i go in and get it done again. i know the hospital build the insurance company twice, but why shouldn't they have to eat the first one instead of getting paid for their mistake? they need regulation on billing, how things are billed. you get a bill from the hospital

and you try to understand it, and new york city lawyers can have a tough time figuring out what they mean, whether you are getting billed twice. there are a lot of reforms that need to take place first before we go to socialized medicine, which is what we are going to be looking at. guest: i think anyone who has been to a hospital or doctor the last 20 years would tend to agree. i certainly don't mean to make a case for the president's plan, that is really not my role. but i think some of the points you make -- some of the areas, republicans and. -- democrats found consensus on, that they need to eliminate waste and simplify some of the reforms. host: john on independent line from ohio. caller: i want to call and express my situation. in september of 2005, i was in a vehicle accident where someone blindsided me on the passenger side, and i was driving and

busted up my soldier and injured my back and had to have surgery on my shoulder. later on, september of 2005. in november of 2005, the same year, i was driving and a german ran a stop sign and i went airborne and we collided. and i needed surgery on my right knee. and then some months ago weeks later, i and my wife were driving on highway and we were following a semitruck and it went out of control and we collided head-on, somebody jackknifed -- we were not able to avoid colliding with the semi trucks. making a long story short, my wife, she ended up getting

knocked out in the accident and she damaged or ruptured three of four disks in her neck and has a ruptured disk in her lower back and i ended up injuring my back even further. host: do you have health insurance? caller: at the time we did, and because of that extension of the injuries that knocked me and my wife out of our job, we were allowed to maintain what we have for years and then the insurance company said we were taking you off of the plan unless you can pay 1200 bucks a month. and there was no way my wife and i could afford that. but courts determined that my back, which i have extensive problems because they could not

separate to was at fault because injuries happened so close together, and that pretty much have to live with the injuries to my back. and we cannot find any insurance because of are pre-existing conditions. no one -- i mean, no one will ensure -- insure me or my wife. all we need is in a opportunity to buy insurance a wicking get the care we need and up into this point out we could find no one who will insure is. it has nothing to do with being able to pay the premium but it is all about you have a condition that you had before you have the insurance and we will not cover you, and there are millions, millions of people -- i hope people listening to what i am stopped saying, millions of people who are suffering just like me and my wife and it is so unfair. it is so discouraging to watch the debates when no into --

winnow. guest: i think john is a perfect example the president is holding up and you will probably cure him holding up at his prime time press conference. i think the question is at the end of the day, how you pay for and how far you go? host: have to leave it there. sam youngman, thank you for joining us. we want to hear from your viewers on what you would ask president barack obama tonight on health care. host: in "the baltimore sun" behalf a story from peter nicholas -- obama won't release names of visitors from health industry.

invoking an argument used by president george w. bush for obama administration is turned down a request from the watchdog group for a list of health industry executives who have visited the white house to discuss health care overhaul. citizens for responsibility and ethics in washington sent a letter to the secret service asking about visits from 18 executives. the group is seeking material as a gauge on the influence of those executives in crafting new health care policy. the secret service sent a reply stating that documents revealing the frequency of such visits were considered presidential records it from public disclosure laws. the agency said it was advised by the justice department that the secret service was within its rights to withhold the information because of the " presidential communications privilege." white house spokesman said we are reviewing our policy on access to visitor logs and related litigation. a continuing of the front page of "usa today," in an interview with house speaker nancy pelosi, who is talking about how they are going to pay.

she said, quote, there is more to be squeezed out. quote, many members think there's more to be squeezed from hospitals, pharmaceutical companies, and doctors. in a continuing q&a with "usa today," she sat down with the editorial board and she was asked -- those who witnessed the health care reform in 1993 and 1994 feel we have seen this movie, a young democratic president of converse offers a sweeping overhaul -- complex, and the whole thing collapses. will the sequel have a different ending? she responds. it definitely will. first of all, the american people have a sense of urgency. if nothing is done now, health care for them will increase in cost. there are two words that should the trouble we are trying to do -- lower-cost. for the families, for the businesses of it and be more competitive, lower costs for our economy so out there doesn't take such a big chunk and more calls for a budget because

health care reform is entitlement reform. we have to take the spiral down or otherwise it is endless and growing deficit, so lower cost. let us hear from our first caller from charlotte, north carolina. are you there? caller: party -- yes, i am. my question is. we have been talking about the cost of health care. we have been in a war with iraq for a number of years. no one ever said anything about the cost. the amount of money that has been spent over there could very well be spent toward the cost of health care. is there a question about that? is anyone saying anything about that cost that is definitely unnecessary expense to the country? host: steve from baltimore, maryland. caller: yes.

my big concern is, the fraud, abuse, and waste with medicare. i have been involved with medicare for 25 years. host: in what capacity? caller: i am assistant vice president for a major vice president -- insurance company that deals specifically with medicare. when you talk about the fraud and abuse, i would like to give one example and show how, when claims are processed from a doctor or hospital or provider to medicare, they are not looking at the bills. they don't have the time. and they will process a claim. when the claim is processed, the insurance companies do not have the ability to adjust any of the claims. they must pay what medicare approves.

i will just give you one example. if a person goes into a hospital for an operation for spinal stenosis, they will talk on to the build the cost for oxygen. and when i had called unquestioned they said, no, the person didn't get oxygen but the reason why the bill is all there is because it was readily available in case they needed it. this happens every day. that is why waste is $120 billion a year. and i can go on and on and on as far as the fraud and abuse. no one is taking a look at it. recently -- you probably saw where the government had gone into airports and were able to sneak bombs on to. no one is seeing the fraud and abuse taking place on a ground

floor basis. and that is the big problem, they want to cut back on the senior citizens of the of medicare benefits but the money is there to take care of that if they just look at all of the fraud, abuse, and west -- waste. host: on the independent line, joe from new york. on a cut the first article you just read about the people visiting the white house, i am afraid the health care is now in the hands of lobbyist and pharmaceutical industry. years ago when i went to a doctor, i was considered a patient and what happened was just that -- we decided on what was necessary. now there are people with sharp pencils determining what you are allowed to get, what kinds of treatment. you have to justify the treatment to somebody who is not a doctor. we have to get these blood suckers out -- how can we get these blood suckers out and

returned me to being a patient and not a consumer? host: buffalo, new york. caller: i would like to state my question, a question you would like to ask president obama. i would like to ask president obama, why they do not include dental care with health care? that act as if people have no teeth and you don't need to do anything about it. if you have health care we need to have dental and the whole thing included because bad -- bad teeth affect your heart. they act we have no teeth or eyes or anything else to go with it. i think it needs to be a full body insurance and not just piecemeal. i get tired of them taking us apart piece by piece. if you are going to do it, do all the way. the other thing i would like to

tell people as i remember specifically what all this nonsense started happening, it was in the 1980's and it was reagan and the pharmaceuticals, when he allowed the pharmaceuticals to be out of control with the billing and charges, that is when they saw them get away and then followed suit, even the cars and everything out of control. until congress puts control around the insurance next, we will be out of whack and end up like wall street. host: florida. dale, what would you ask barack obama later tonight? caller: thank you for making my call -- taking my call. i wanted to make a small statement. i just feel that medicare, is that all government run health care and what? i just want to make a thing

like -- should we not be afraid of change because we can always go back to the way we are now, we can try the president's plan and just to see, maybe he's got a good plan. thank you very much and thank you for taking my call. host: independent line. anna from college park, maryland. of a cut it is a sad day for america -- caller: it is a sad day for america. congress is going home. if this were the private sector, you would not go home. they're taking a month off? two weeks is not enough for them? are you kidding me? and the republicans, we are paying them for doing nothing. would you employ someone who was not working were earning their pay? people need to stay in washington and solve the problem. this is a huge -- i think it is a national-security problem. i cannot imagine life without

social security get there are so many people who were against it. this is a time to act. i have health care. i don't have any problems but there are so many people and americans who have problems and i don't mind paying an extra $10 for a pay. for someone who does not have. we need to develop backbone and get this done and start being the neighbors helper. host: in "the washington post" have a story about senators trying to work for a compromise. senate panel takes careful approach to crafting health there -- health bill. they write -- while the issue of health care reform divided democrats and house, members of the senate finance committee seemingly ignored the hubbub and the deadline as they huddled daily in pursuit of a bill. they are trying to resolve potential controversies behind closed doors. on tuesday senior panel members expressed confidence they can complete committee action before president obama's august

deadline and in the process of track significant bipartisan support. the finance committee is the only place left where a bipartisan bill that also gets on top of the spiraling health- care costs, said senator charles grassley. ocean grove, new jersey. a sideshow on the democratic line. caller: i wanted to say, why doesn't the government take a look at france. i have a sister who lives in france and whenever there is a survey, france always comes out of the top in terms of health care provision. my sister was infertile and in this country she would not have afforded to see if there is a fertility doctor and she has three children because in france they paid for her fertility. orrin hatch in one of the meetings try to bring up a very small amount of tort reform and even senators and congress would not go along with it. we have too many interests like trial lawyers, insurance companies themselves,

pharmaceuticals who are running our government. it is time for people to stand up and say enough, enough. we need a health care program that shows concern for the citizens of this country to be healthy, not just to pay for situations. what do they do to make us healthier? do they even look at best practices? host:, the republican line. what would you ask for barack obama a lot of for this evening? caller: i would like to ask barack obama about the public option and ask the senators and congressmen with a join it. host: do you support? caller: no, i don't. host: why not? caller: it is way too much money and way too much -- the doctors don't like it, and that is why i don't like. host: mary from orlando, florida. caller: good morning. host: do you have a question?

caller: yes, i want to england in 1970, and when i was there i got five doctors -- two and these come eye doctor and dentist. i was over there for six months. we need to care for our people. host: on the democratic line, helen from alabama. caller: i want to ask president obama and the congress, will they have some kind of -- something that will prevent fraud, such as what is going on with medicaid and medicare currently. i know from my own personal experience with medicaid that medical providers do sometimes

commit fraud. they will resubmit bills, and specific information is not looked at and then multiple payments are made for the same single server. i think if we could stop the fraud we can afford a loss more for more people. i'm told about 25% a person to ever applied for medicaid actually get it. people are being robbed of the chance to get what they need because of the fraud that is being perpetrated. host: dupont, washington. joe on that independent line. caller: i'm a physician and nobody talks about the 10,000 pound elephant in the room, and that is the on necessary -- so called on necessary ordering of tests. i freely admit i order every year hundreds of thousands, if

not millions of dollars of unnecessary tests because of the fact that i am deathly afraid of being sued by trial lawyers, and somehow have to cover my rear and make sure that anyone in a zillion diagnosis is not nest, so i just keep on and order unnecessary tests. the trial lawyers are leading donors to the democratic party, and unless somebody addresses that i don't understand how there could be any meaningful savings in terms of health care. host:. on the republican line from dallas, texas. caller: i would like to ask president obama -- the urgency

he has come of this 1000-page legislation, and the three or four versions going through all over the place. there is not even a comprehensive package right now to even pass. and he says it is urgent that it be signed off on, but this is such an important thing. yes, it is time. everybody agrees it is time to find a way to make healthcare better for everyone, whether you are a millionaire war you have $5 in your bank accounts. but in doing that, you have to do it with all the chess pieces on the board, and you don't rush it through the game just to get

to the end of that only to find out that we are at checkmate. host: on the front page of " the new york times" today, the headline, selling reform. our health-care system is engineer deliberately or not to resist change. the people will pay for a often don't realize we are paying for it. money comes out of our paychecks in with held -- and withheld taxes and insurance premiums before we see it and then it flows to doctors, hospitals and drug makers without our realizing it was our money to begin with. they used the money to treat us. if anything, we want more. they are supposed to make a healthy and appeared to be free. what's not to like? the immediate task facing mr. obama in his news conference on wednesday night in bianna is to explain that the health system that really work the way it seems to. you will be able to put it in such blunt terms that he will need to explain how a typical house -- typical household, one that has insurance and things and always will, is being

harmed. san francisco, california. sheila. caller: i would like to ask president obama why are you considering rolling out the same health care plan that the senate and the congress and house have a and the president's -- president, instead of recreating a whole new system. there seems to work for them. i have never heard any complaints about their health care. why aren't we doing the same program for everyone? host: sponsor of a -- spotsylvania, va. good morning. caller: of i would ask him, in his new program, they are trying to find enough money for this program but i would like to know -- forgive me, i am a little bit nervous about this. i would like to note if he is trying to find the money for this program, why doesn't he have enough money for the men in

the persian gulf war? their mental illness -- the answer is to put them in jail or in prison. i absolutely know this for a fact. i talked to many people in years and there is the same thing, not enough money. so my question would be, why would you not have money for the men who fought for our country now, and you are trying to get enough money for -- well, for the country? that is what would be my question. i know someone in jail for four years and this is the way they do that, absolutely. host: coming up next hour we will talk to mark zandi, chief economist for moody's and we will have dr. gibbons from the mayo clinic. but first, a news update from c- span radio. >> federal reserve board

chairman ben bernanke heads to capitol hill this morning. yesterday he appeared before a house committee. today it is the senate banking committee where he is likely to be questioned about the central bank's economic rescue efforts. here live coverage at 10:00 a.m. eastern time on c-span radio. with yesterday's senate vote to cut funding for the f-22, the issue now moves to the house. the house appropriations committee votes on its version of the fiscal year 2010 defense bill which includes a $369 million worth of f-22 funding. from "the washington post" reporting from thailand, secretary state clinton says the united states is concerned north korea will transform -- transfer nuclear equipment to burma. she made the remarks in an interview with thai television and later at a joint news conference the secretary said, irreversible denuclearization is the only viable option for north korea.

and those are some of the latest headlines on c-span radio. >> "washington journal" continues. host: joining us now is mark zandi, chief economist for moody's where we will talk about the economic stimulus package. and you tell us how effective the stimulus package has been to date? guest: so far, so good. the money is flowing out pretty close to what i expectant and it is helping. state governments are still cutting budgets, they have fiscal problems, but the cutting would be worse. under woodworkers are getting more benefits -- and if they had not gotten them they would be cutting their spending more aggressively. we got some tax cuts. social security recipients got checks that a starting to glow. this law was part is the infrastructure spending, but i don't think it is a surprise -- the slowest part is infrastructure. there were a little too optimistic. host: meaning transportation?

guest: mostly, but it is broader than that. the economy is going to struggle and they will be the use the help in 2010 and 2011. host: federal reserve chairman ben bernanke was on capitol hill giving a report in the front page of "the financial times" rights -- the fed chairman's sat out the exit strategy for its policies, which pumps used -- huge amount of liquidity. mr. bernanke stressed despite glimmers of improvement the fed intended to keep interest rates extremely low for an extended period. the fed expects the economy to start growing again at the end of this year but thinks the unemployment rate now at 9.5% will remain elevated through 2011. you agree with that assessment? guest: i think it is right. i think the economy will start rolling in the current quarter, q3 -- not a lot and not to really generate a lot of jobs and certainly not to bring down unemployment, that will not happen until next year. having brought the he got it

right that the economy is proving from which is moving from a deep recession to recovery by and of this year. host: how much of the economic stimulus package is in the economy right now? guest: the package was $787 billion. the actual money not more? guest: a lot of it will only be paid out when needed. .

is no accident the economy is going from recession to recovery in current quarter, because the maximum economic benefit from stimulus is happening right now. host: our guest is mark zandi, we are talking about the economy. democrats, 202-737-0002. republicans, 202-737-0001. independents, 202-628-0205. if only $100 billion of the first stimulus is felt there, why is their top of the second? guest: i think it is natural reaction to how the economy is performing. we all want the economy to improve immediately. when we are suffering job loss and in many states it is over 10%, that makes us uncomfortable, and reasonably so.

i do not think it is inappropriate to start thinking about another stimulus, if we needed it, but it is premature to conclude that. we need to wait until the end of the year to see how things are going. host: when will we see the stimulus fund peak? guest: the actual benefit to the economy, the change in the spendout. that change is what really matters to the economy. in out rate will be about the same, and will fade into 2011. host: next phone call from rockville, md. caller: i have seen you speak many times during the election.

one of my main concerns in the stimulus package -- and it bothers me that so many people are protecting this package. the biggest problem we have right now our jobs. 70% of jobs are provided by small business, but no one comes to the realization when there is no money in the economy and nobody is spending money, small businesses go out of business every day. our business is down 25%. i have been doing this for 40 years. no one seems to be grabbing onto stimulating small businesses to help them get through this crisis. every day we see signs of people going out of business because there is no focus on this. the stimulus package is only

producing government jobs and is only helping to stimulate the state to get away from some of the programs that they have indoctrinated. there is so much of it, no one considers the fact that it is not really a stimulus package. guest: i was a small business owner in the 1990's, and then sold it four years ago, so i understand what you are speaking of. it is difficult to design policies that will help specific small businesses. the idea is to get money on their in the economy, so that the consumer can spend their money on whatever they deem necessary. hopefully, that ends up in the coffers of small business. i know all lot of small business people are having trouble getting credit because of the problems in the banking system. one idea would be all-out --

would be to allow the small business administration to make more loans. there are some things that could be done to make credit more available. the idea behind stimulus is to give cash back to households, business people, and to get them to spend that money, and perhaps that money will find its way back to small businesses. host: next phone call, california. caller: good morning. it is always about money. that is what makes the world go around. they are giving us tax money back on one hand, but then they are taking it back. i understand the idea of stimulating the economy, but not

with health care. it is not going to be free. there are ways to benefit -- and limit benefits and health plans and put money back into the government without having to add more numbers. i was in the insurance business for many years. it seems to me many of these agencies within the government -- i called today for some referrals, and i got three names. none of them are dermatologists. one was a gynecologist, which i never asked for. one was a rheumatologist. there you have some information i got today that was outdated, and someone there is getting

paid to have these lists handy, but they are not even current. guest: let me talk grandly about health care reform from my perspective as an economist. to me, what matters most is paying for the insurance that we provide for the uninsured. i think that is very important. we need to do that, but is equally as important that we credibly pay for the cost. secondly, health care reform has to result in reform that slow the rate of growth in the future costs. right now we do not make changes and cost me rise very quickly, at least twice as quickly as everything else that we consume. we need to put forth changes to the health-care system that resulted in a slower rate of future health-care costs. if we do those two things, we

will be able to insure the uninsured, and it will be a positive for the economy. if we do not do these things, it will be a negative for the economy. host: we had this exchange between steny hoyer and japan's karlan on jobs. >> it is time to admit the failure of obama-nomics. 2 million more are unemployed since enacting the president's plan. 9.6 percent unemployment. what do we have to show? $143 billion more of taxpayer bailout money. the first $1 trillion deficit in our nation's history. the national debt will be trickling in the next 10 years.

-- tripling in the next 10 years. where are the jobs? you cannot spend your way into prosperity, it does not work. it is time to put america back to work with tax relief for small businesses and american families. that is the republican plan. >> you talk about jobs, talk about the experience you had under our program. last year, in the bush administration, we lost 3 million jobs. in the last year of the clinton administration, we gained 1.9 million jobs. that is a 5 million job turnaround by your economic turnaround, so keep talking. america knows the difference. they knew that what you were

doing was not what they wanted, so they changed in 2006. then in 2008 they changed the presidency. we have lost 200,000 last jodhpur month that president bush lost every month in the three months of -- three last months of his presidency. is it what we want right now? not necessarily, but it is better. refute them if you would like to, keep talking. host: what is your reaction to that? how has stimulus played into job creation? guest: we lost 2.1 million jobs in the first quarter, 1.3 million in the second quarter. my sense is we may lose three- quarters of a million in the current quarter. if the next year in job losses

are done and over with, we can conclude all of the policy efforts, including the stimulus, can be successful. host: what do you look for s lines that the stimulus is working? guest: i think we need to look at jobs. if we stick to the timeline i articulated, we would be doing pretty well. generally, on the plan is the last thing to improve, for various reasons. i am open by next spring the increase in on and limit should be over. retail sales, consumers are spending a bit more. some encouraging signs there. going back to last christmas, people are cutting their spending. christmas 2008 was last sales than 2007. since then, things have stabilized. we are still cautious, but at

least we are not cutting spending. host: next phone call from seattle, washington. caller: good morning. as an economist, your opinion carries a lot of weight with me, personally. from your perspective, what blood in massive ice crackdown on illegal workers due to the agricultural sector? what are the pros and cons if ice doubled their efforts to rid the country of illegal workers. -- workers? guest: i think it would be very disruptive, certainly in the near term. it would be difficult to do this without creating problems for

everyone involved. certainly, it would not be a very useful thing to do in an economy that is suffering from a lot of different disruptions. whether policy-makers decide that is something they want to do in the long run, that is one story, but in the near term, not much benefit. host: next phone call. caller: good morning. i just want to say one thing. the best thing -- the best stimulus would be a job. excuse me for saying this, but most of the time, government is the problem. we have an unfair trade practices, we have a country like china that we give favored

trade status to. we know that they do not play fair. we had manufacturing bases that have left. north carolina is a perfect example. we used to pride ourselves as the textile capital of the world. we used to be a furniture making company. we no longer do that. everything is made overseas and brought back to us. i'm sorry, the public sector does not manufacture wellalth. guest: the carolinas have been hit pretty hard, you are right. they have been pummeled in the past 25 years in the manufacturing cents because of overseas competition. i do agree that key thing -- the

key thing is jobs. we need to get money out to consumers, state to spend money on services, and hopefully that sales -- creates sales for businesses, and as that occurs, they will hire more people. generally, i do not think stimulus is a good idea. it can be counterproductive. but in this particular p eriod that we have gone through, it was very important. everyone was panicking, and it was important for the government to step into that void and keep the economy moving forward until the economy sector gets us back on its feet and get us moving again.

normally, i would agree. stimulus is a bad idea, policy efforts should be limited. but in the last year, six months, it has been critical for the government to be very aggressive. host: next phone call, illinois. caller: c-span callers are filled with common sense, it is wonderful. we do not really have a government that is working for us. the government is compromised, and they do not care about us. they make laws and the crimes. c-span listeners should be in the congress and senate with their common sense. all those people have jobs,

homes, second homes, health care, even after they leave office, we pay for their health care. there is no rule of law. illegal aliens are taking our jobs. insurance companies get rewarded. this is not a financial crisis, it is a financial fraud that has been perpetrated on the world, and then they get rewarded. insurance companies and politicians reward themselves and we are holding the funds, american citizens. guest: i hear your frustration, i understand where you are coming from, but let me say, no one has really done well in this crisis. it does qualify as a very

significant financial and economic crisis, the worst economic downturn since the great depression. i think it is also reasonable to say that it would have been immeasurably worse, if not for the very aggressive policy in place. fiscal stimulus, efforts to stall foreclosures, efforts to prop up the banking system. even efforts to help up the auto industry. chrysler and gm may have been liquidated in we may have lost even more jobs. we can debate can disagree, and find fault with one single aspect of what policy makers have done, but they did all this in a very short period of time. maybe not all of it was right, but when you look at this in totality, it has really been quite impressive. host: taking a look at the

"washington post" they look at the hearings on capitol hill. "the treasury department took a bipartisan beating, claiming the agency failed to live up to its promises of transparency in handling the rescue of the system. taxpayers now have a spending program run under the policy of do not ask, do not tell, said a democrat from new york. the republican on the committee said patience is running out for the transparency promise." do you think the administration has been transparent enough on how they're spending? guest: i am surprised by the sharpness of the criticism. it is fair of congress to want as much information as quickly as possible.

that is important. but i think there is quite a bit of information with regard to how that money is being used and where it has gone. i am not sure exactly what they would like to see that they have not seen. from my perspective, it has been pretty good. host: next phone call. anita from michigan. caller: i have been watching you from the beginning of this thing. i am unemployed. item three weeks into unemployment. -- i am three weeks into unemployment. what happens when the money runs out? are we going to become a ghost town? we were hit so hard with the economy.

guest: you are from michigan? you are in the hardest hit state in the country, far and away. nationally, unemployment is 9.6%. i believe right now in your state is 15%. clearly, you have been creamed by particularly in the automobile industry problems. the housing market has been terrible there. many homeowners are under water, meaning they owe more on their home than the value of their home. the health in terms of unemployment benefits, that will run out. in the case of michigan, and extended benefits last for one year, but beyond that, more help

will run out. hopefully, the money coming in to jump-start the private sector business enough as well as the consumers. it is tough, but most times when people lose jobs in one part of the country, and there are other jobs in another part of the country, they will move. that is actually one strong perspective of our economy. people are more open to moving around here, that does smooth the transition. i know it is difficult for you and your family, but that is one thing to consider. the state of michigan will be under some pressure for quite some time. host: explain the multiplier

effect in spending and tax cuts. guest: the idea that the government spent an extra dollar to reduce taxes, that money that goes into the economy and generate other economic activity. for example, if i create food stamps for people who are under financial stress, and they go to the store, by the produce, dairy products, and that money goes to supporting the worker at the store, the trucker that deliver the produce, it goes to the farmer, the ag equipment producer, the pesticide producer that was used in the farm. those people would get that in

come, and then they go and spend it. then the store clerk nearby will take that money and spend it elsewhere. it is a ripple effect. that is known as the multiplier. there is some debate about the size of these small suppliers -- multipliers for different things. if we spend more dollars, the multiplier effect seems to be bigger. over one year, the multipliers are bigger overtax spending. if i give you a tax cut, people are going to say that money and perhaps they will spend it on something not produced here. if you give me $100, maybe i will buy a flat screen tv that

is made in taiwan. it would not be the same thing if i bought that gallon of milk. all of these policy efforts have multipliers, but they vary quite a bit, based on the kind of thing that i've articulated. host: next phone call from georgia. caller: what i do not understand about this health care package, why don't you democrats tell the truth? why don't you explain the long term effect of this when you get to 68 years old? i can keep my insurance company if i am happy with it. you are sitting there looking at me and you are telling lies. all of these older people will be out of jobs. all of these people being looked at in hospitals will get sicker.

you are eventually going to let them die. you are not going to take care of us. i believe he is trying to be a dictator. all he can do is spend, spend, like his wife. we have to tighten our belts. maybe he needs to get back in line and get off the tv. i used to be a democrat, now i will not even lift assigned one. all you are doing is destroying our country. -- live by one. host: next phone call. caller: i am sorry for that last person. all of the ventures in iraq, it did not benefit the american people. we helped the republicans do what they thought was the right

thing for the country. now that their policies have failed, we need to take a different course of action. they are doing everything possible to defeat every initiative the american people want to. are these people american? i am worried these people are counterproductive to american society. are they trying to help us or harm us? guest: i am an economist, not a politician. both of those callers, obviously a lot of anger, but i have nothing really to say to it. host: louise from orange, massachusetts. caller: it is hard for me to

understand since this free-trade agreement started, that is when the economy really started plummeting. we have so many jobs going overseas. then these corporations want more work visas from people from other countries to take our jobs. then we have the illegal aliens coming into the country to take our jobs. you wonder why there are no jobs. what effect does that have on our economy? obviously, it has proven to be in negative 1. in terms of health insurance, here in massachusetts, i helped my daughter and my fill out an application for insurance that she needed to have on t. they stressed many times that you did not need to be a citizen. so here we are paying for these people to have health care wa.

it seems that if this is a global economy, it should be a global tax system. the american people should not be paying for the rest of the world. guest: maybe i will take this as an opportunity to talk about the benefits and detriment of global trade. you are right, in global trade we have lost a lot of jobs. the person who called from south carolina mentioned textiles, furniture. we have lost a lot of jobs due to trade. particularly, china has been very aggressive competitors. however, there are significant benefits. before the recession, we were selling lots of things to the rest of the world, satellite

technology, ipods, all of the music that goes into them, computers, engineering, software, web design. that is all done by folks in california. sophisticated instrumentation, materials. increasingly, people in these industries are selling what they do to the rest of the world. media, financial-services, even health care services. educational services. go to any university in the country and it is full with kids from all over the world coming here to use our education system. there are many industries, occupations, and increasing jobs that come from global trade. there are people who are losing jobs, and those who are gaining in the form of trade. as a nation, we need to do

better retraining people whose jobs are getting lost, so that they can become and police in these higher paying industries. when you add it all up, all of the negatives and all the positives, in my view, the positives significantly outweigh the negatives. we do not want to stop that. host: thank you very much. we will be back with dr. ray gibbons from the mayo clinic to continue our discussion on health care. >> but when the conversation on civil rights and race relations with juan williams on sunday,

august 2. this weekend, want a 1997 interview with the late frank mccourt talking about his pulitzer-prize winning book "angeles ashes." >> susan jacoby on the public's ongoing fascination with espionage trial of alger hiss. host: and joining us now is dr. ramet -- dr. ray gibbons from the mayo clinic. thank you for joining us. guest: thank you for having me. host: the mayo clinic recently issued a report critical of the house health care bill. what are you looking for in terms of changes?

guest: let me clarify the position. we wholeheartedly support obama's call for health care reform. we agree with his statement earlier that the one option not on the table is the status quo. we commend both the senate and house for their efforts to ensure universal coverage for all americans, which we view as one of the cornerstones of health care reform. however, additional steps are necessary. the president urged congress to look too high quality and efficient health care providers for information as to how to guide health care reform. we believe it is critical congress encourage health-care providers to pay for quality and value, rather than simply the quantity of health care, so that we can achieve the goal of better health care for all americans and a lower cost. host: the president and many have cited the mayo clinic as a

facility that provides good quality care for less cost. how can the president can health care reform plan this model to the industry? guest: we believe they must reform the payment system under medicare. correct me, that system only pays for the volume of procedures and tests, that is the quantity of care provided. it does not pay for quality for value. medicare pays more to the portion of five states that often provide lower quality, safety, and satisfaction at higher cost, and much less to the rest of the country that provides better quality, satisfaction, and safety at a lower cost. that is a reflection of the current system. we believe that system need to be changed to encourage providers to focus on value and

quality, so that we can then the cost curve of health-care cost inflation. host: what is the mayo clinic doing right in health care? guest: we believe one of our strengths -- and we are not unique. there are many other healthcare providers like us. we focus on value, the needs of the patient come first. we tried to provide the optimal amount of care. that is, not more or less than what the patient needs, but what they need actor they and their doctor confer about their health care problem. we are coordinated. we have excellent electronic records. physicians work as a health care team along with nurses and other allied health professionals. those are strengths that are not -- that are not unique to us, but our true for all the

organized health care systems in the country that generally provide better quality at a lower-cost. host: if you have a question for dr. ray gibbons, democrats, 202- 737-0002. republicans, 202-737-0001. independents, 202-628-0205. dr. gibbons, so our viewers are clear, what is your role at the mayo clinic? guest: i am a staff cardiologists, i have been practicing for 28 years. host: 20 you think are the chances of healthcare reform passing this year? -- what do you think are the chances of health care reform passing this year? guest: we certainly hope it happens. it is a complex question that has gone on for too long and there are many stakeholders that will have to give something up. patients will have to focus more

on prevention. providers will have to focus on value. congress need to find a way to cover all americans and reform the payment system. also, other stakeholders, hospitals, drug makers, device manufacturers, all of them are going to give something up. that is what makes this difficult period hos. host: do you have a current position on the public option? guest: yes, we provide service to patients who are not fully covered or reimbursed. that is, our costs are not covered. we are reaching the point where it is increasingly difficult to take care of those patients. in medicare-type option that does not include reform of the payments system will simply put more americans into this unsustainable system, and we do not think that will be a

positive effect. host: what would it take to get the mayo clinic to endorse a health care bill? guest: we would endorse a bill if it includes bold reform that would change the cost curve. there is currently a bill in both the senate and house that will reform medicare payments. the sponsor in the house is representative kyl from wisconsin. in the senate, senator carl bogklobuchar. both of them factor safety and quality into the payment of physicians. we believe that will begin to train provider behavior throughout the country, without interfering with the doctor- patient relationship. host: let us hear from the viewers.

on the republican line, oak grove, california. caller: it seems to me we spent a lot of time saying we need something so thabad, and we have been working on this for 50 years, but we still do not have a plan. i think we're being told a lot of things that are not accurate. i wish we would become more open and what they are trying to do. i am trying -- tired of hearing politicians skirt the issue and using their powers to avoid solving this serious issue. guest: we would certainly agree, this is a complex problem. we think the public ought to be engaged and that members of the

public ought to educate themselves about the facts. i have cited some of the issues with and expect to payment disparities. those are available publicly at the dartmouth health care at less website -- atlas web site, as well as the usa today website. i would recommend looking at those numbers and then communicating with your congressman and senator that not only do we need to cover all americans, but we also need to dampen the cost kerf. that is what is running the country. -- cost curve. host: and joe from orlando, florida. caller: i have not heard you say anything about fraud in the system.

when i was a student in 1969 in new york city. , i had a summer job and i was assigned to investigate fraud in medicaid. i was the only one aside from two other people doing that. what do you think of ben person's comment when he was asked about reforming health care, he said we can either digitize the records, and he said this, facetiously, use the saudi arabian system of cutting off hand. no one is addressing the fraud. i think we must address that question. guest: certainly, we would agree that fraud is unacceptable. as health-care providers, we would certainly uniformly criticize and not tolerate that.

i am sure members of congress would agree. there have been extensive efforts over the years to try to deal with that issue, and that certainly should be addressed, but that is only a part of the problem and we need to address the broader issues that we have been discussing. simply reducing fraud will not solve the problems in the system. host: indiana, danielle, are you there? caller: do you believe the government can handle the health-care system better than insurance companies? i am very concerned -- i do not have a job, my husband lost his job a couple of months ago. we are about to go on medicare, which i am trying to stop.

i understand how ridiculous government health care is. who will be making the decisions on whether or not my grandmother gets a hip replacement? who are those people who will be making those decisions? that is what will be happening. guest: that is a very valid concern, and it is shared by many americans. health care is a highly personal issue and they want to make sure that everyone is well taken care of. we understand that health providers, our mission statement is that the needs of the patient comes first. i think the government has a legitimate role in health care, particularly by helping those who are less fortunate and unable to afford health care insurance, by subsidizing premiums and programs like medicaid. however, i do not believe

washington should try to run health care, just the way i do not tell congress how to write bills, because i do not have expertise in that area. from my experience, most congressional members do not understand the health care system. for that reason, i do not think that we want care directed from washington. we do want guidance, assistance with financing. just this week there was a proposal for an independent medicare review commission from the white house. we support that. we believe that is the kind of step, that over the long term, will help us pay for about you in health care, rather than simply the quantity. we are concerned about the time frame -- 2014 -- that seems fairly long, but we are eager to work with the administration on

this and these types of programs that are badly needed for health care reform. host: next phone call. illinois. caller: one of the things i saw, they were interviewing a doctor last week. the way i understand the health care bill is, this doctor said she had 3000 patients. when the government gives everyone free health care, don't you think that everyone will overwhelm the system? i think we would have been better off if we went with health savings accounts, or stuff like that. i think having the government in charge is a disaster. medicaid is about to go broke. guest: i am not personally all

that familiar with the massachusetts system, but i think they are facing the problem correctly of having dealt with coverage, and not with cost. that is one of our concerns about the current house bill. simply having coverage, as you pointed out, does not guarantee access. providers are finding it increasingly difficult to care for medicare patients. if we have in medicare-type plan without a reform of the payments system, many more of them will be pushed across the threshold where they refuse new medicare patients, and that will reduce access to the very people that are now covered, and that will replicate the problems of current -- currently occurring in massachusetts. host: next phone call from paris, illinois.

jeanine? caller: how long do you have to wait to get an appointment at the mayo clinic? guest: we are always happy to have questioned about the mayo clinic on television. the amount of time you have to wait for an appointment strictly depends on your medical problem and urgency. we triage patients based on their needs. those who are in need of our services and however urgent medical problems are seen very quickly. those coming on a more collective basis have to wait longer. -- elective basis have to wait longer. host: richard, gaithersburg, md. caller: i believe in keeping it simple.

how come the government and medical system could not go into a program with one government clinic per state, 10, 20 doctors -- what ever it takes. i think that we could cover a lot of these problems with one visit only. keep it simple. have a bus system that goes to these centers. most of these problems could probably be solved in one visit. that could save a lot of money. guest: there is no question we can all look at the current system and imagine how it could have been done better. i have been saying that myself for 28 years. but i think we have to recognize this is an enormous system, 1/6 of the economy, and we cannot recreate this from scratch. the president has made that point many times.

we have to look to modify the current large system in ways that will better ensure health for all americans at a lower cost. although i am attracted to your idea, we cannot start over. host: we have an e-mail question from bill roberts -- guest: that is an excellent question. certainly, of electronic medical records, the better use of health information technology is critical to better coordination of health care. we want records to be interchangeable, we want there to be communication. the stimulus package included extensive funding for h.i.t.

we have seen some new standards for that. the concern that you are raising, records and talking to one another, is critical and part of the emerging standards for health information technology. we certainly hope not will be the case. host: boynton beach, florida. william? caller: i would like to know why they do not discuss malpractice insurance as far as lawyers are concerned secondly -- concerned. secondly, i was a trustee at a hospital in connecticut, and i got a phone call telling me that malpractice was going to go from $800,000 a year to $1.2 billion. i wonder what the cost of malpractice is at the mayo

clinic? guest: i am afraid i do not know the answer. we are self-insured. however, we recognize this is an important issue for health care providers. we frequently take this question from providers around the country. right now, we would consider this a second tier issue. there's extensively from place to place, and there are clear examples of states with model ballpark this legislation. the largest example, california, where the cost of medical care remains an enormous problem, and where there are enormous disparities within health care. people on capitol hill suffer under the simplistic impression that california is all a high- cost state. that is not true. there are multiple regions, bakersfield, sacramento, santa

barbara, sacramentthat actuallya low national level costs for medicare. there are other areas that are much higher. if a malpractice legislation was the answer, california should not be a problem, but it is. that is my currently it is a second tier issue. host: next phone call, missouri. caller: dr. gibbons, i have a question concerning health care for people, especially with mental health issues. i am bipolar and i'm on disability. i have found it is extremely difficult to get psychiatrists, therapists to accept any kind of medicare or private insurance that i might have, any kind of supplemental.

do you see any kind of progress being made in health care for people with mental health issues? we always talk about physical issues, but we tend to ignore mental health, which is a big problem for a lot of people. if you are caused not sound mind, you are probably not taking care of your body. guest: i am sympathetic to your situation, and i think as a health-care professional, i try to empathize with the physician working with me. mental illness is just as bad as physical illness, and they need our help just as much. i think we have come to recognize that, and increasingly, there have been a

variety of legislative efforts at the federal and state level to even the playing field for people like you. i think time will tell if they are successful in ensuring appropriate access for everyone with mental illness, but turned me, your problem and others like you -- but certainly, your problem and others like you, people are working on it. one of our congressmen was interested in this issue and introduce legislation into the congress dealing with that. we hope that this problem can be addressed. host: next couple call from steve, minnesota. -- phone call from steve, minnesota. caller: someone called in a moment ago and said that he was scared because of trials.

he orders million dollars of extra tests to cover himself. until that issue is addressed, he believes there is no hope in sight. you mentioned that there is going to have to be some shared pain. i noticed that you did not mention for perform -- tort reform. i wonder if you could comment on that. do you have an estimate on the cost of medicare results -- lawsuits? they say as a percentage of gdp, it is 15% for our medical care. what percentage of that is attributable to lawyers? guest: as i mentioned earlier,

this is an important issue for many health-care providers. i am not a health-care economist, i do not have the expertise in the malpractice arena to give you the kind of estimates that you want. there are published estimates, but it is important to point out, they vary greatly based on the region of the country. the president spoke recently to the ama and promised some elements of tort reform would be included in health care legislation. we would hope that he follows through on that promise. i would emphasize this is not the entire antar. we need to change the payment system to reward quality and value rather than the quantity of service. we believe that is fundamental to beginning to change health care provider behavior over and above defensive medicine

throughout the country to achieve better health that lower-cost. host: we have a question on twitter. guest: we do not, that is simple. host: we will have to leave it there. thank you for joining us. coming up, "washington journal" will be speaking to representative gene green, a representative to from texas -- from texas. and then later on, michael rothfeld on the economy. we will also be hearing from students on the civic bus who are attending a legislative summit. first, an update on c-span2 radio. >> in addition to tonight's prime time news conference, the president meets with the iraqi

prime minister nouri al-maliki at the white house. the two will appear later today in the rose garden. when the president appears in chicago tomorrow, the dnc will releasing its outreach effort known as gen 44, whose goal is to attract college professionals and young professionals. jim demint spoke earlier, saying it is time to put the brakes on president barack obama. he refused to take back an assertion earlier that the health-care overhaul the president wants will be his waterloo. asked if he stood by the statement, he replied, "it is not personal, we have got to stop politics." the senate votes next week on the nomination of sonia sotomayor. one member, john kyl, is calling her testimony evasive, lacking in substance, and in some cases,

misleading. he said that he will vote against her nomination. finally, a private study finds federal agencies are facing a severe shortage of computer specialists. even as a growing wave of coordinated cyber attacks pose as potential national security risks. the president said cyber security is a top priority, but the white house so far has been unable to fill its cyber czar position. host: joining us now is congressman gene green of texas, a member of the energy and commerce committee. i wanted to start talking about the issue of blue dog democrats in the house. several members are on your committee and they have been making a lot of news.

"lou dobbs demand health care change." the size, shape, and extent of the plan depends on a handful of members. . so, but the blue dogs are part of it and that is the typical legislative process.

they represent about 50 members of congress, democrats, and i'm glad they're doing what they are doing. but i know at the end of the day we need to get something out to the american people to cover everyone with some type of health insurance. host: what is the state of the bill? guest: we have had marked up for a couple of days, starting last week and this week. because the was a meeting at the white house yesterday, it took a great deal of time. nothing we will take that up tomorrow on actually voting. when i say mark up, that is congressional speak for voting on amendments. we were in session on tuesday night until 1230, dealing with amendments. so we will get their. we may not meet the deadline that everyone says to get it out by next week. we could, but we have been in session all night. under the republican

demonstration for prescription drug plans, we stayed up all night on the house committee and on the floor of the house. congress can work late out -- late hours to get things done. host: would be easier or harder to get things done if you do not meet the pre-august deadline? guest: i don't think it matters so much. if we have a bill that and come out of committee, i would love to have it a week and go home in august and have town hall meetings during the break. i would like to be able to show something. if we can't give an actual bill, hopefully we have something that is a draft. because two of the three committees of the past there's -- ways and means, education and labor, energy and commerce has the bulk of the responsibility, and of course, the senate is moving on their own. host: does the public option have to be part of it? guest: i think you have to have one. i was a state legislature -- we tried to cover the uninsured with some sorts of plans through

the private sector. the problem is, the uninsured can't be covered where companies need to make a profit. so it has to be a public plan that covers nationwide. and that is something that is important in the bill. if we are going to get to the 40 -- people don't have insurance, we will need a public plan option. host: at the president will have a prime time conference -- what do you think the president needs to say? guest: i want to hear the presidency with a say in texas all time, get 'er done. i want both cost containment, because i know -- 60% of the american people get insurance through employers right now. we shouldn't mess with that. what we ought to do is help employers able to deal with the cost increases.

any time, much less with an economy that has the problems right now. we need to get a bill done and it needs to cover everyone, whether you are in california or texas or new york city and have a plan for everyone. not necessarily a government plan but like i said, 60% of the people in the country get it through their employer. leave it alone bill and let us get to the folks who don't have coverage. host: congressman gene green, if you have a question, please call lynn. -- call in. let's take our first call from texas, lynn on the republican line. of a townhouse or you this morning? -- caller:, howard you this morning? i'm from texas, it bothers me that texas ranks 48 in care of elderly and disabled. i have been -- i am 100 percent

disabled, i was the mayor of the town. my husband runs his own business. he is 100% disabled with 15 herniated disks. he gets $1,116 a month or disability. our cpa does not pay my social security and i and six quarters short and i get zero benefits even though the judge said i was 100% disabled. my husband has to pay my medical. we live on $600 a month. we have to pay our property-tax, house insurance and car insurance and medical and food, everything. what is wrong with the system is every state gets to pick their own amount and texas and four other states always take the minimum. right now low income couples with disabilities, $1,005.

minimum wage is going up to $1,160 at the end of this week. my husband will be making $44 less than minimum wage on disability. but, we are not low income because we make more than $1,005 because the federal government allows hawaii and california to thousand dollars if low income. the you have any idea what it is to live like this and that i can't go to the doctor and my husband has to pay it and we are down to, i cannot even go see my grandchildren two hours away because i don't have the gas to go there. do you have any idea that until you change the system and you don't let each state pick what they're amount is for low income, that people like me get left with 0. guest: well, i appreciate your

call because that is my problem. i'm a native born texan, born in the same hospital in houston and proud to being a texan, but on health care we have the highest percentage of uninsured, highest percentage of uninsured children. 900,000 of children in texas qualify for medicaid and schip but the state will not pay the local match. individual states under medicaid and schip make decisions on how many people and the income, like you have. you have to be almost destitute in texas to qualify for medicaid. that is why this bill, we are talking about a national system. i asked chairman waxman and everyone else that we need a maximum -- national plan. we don't need something that leaves out states because they cannot afford board will not come up with the match. believe me, i have a district that is similar to your

economics, a poor area in east harris county. we have a lot of people in the same position you are. we need to reform medicaid. but right now we are trying to cover the 43 million up to 50 million people in the country who don't have insurance. i could spend a lot of time with the on that, because it is a problem. host: we have the c-span 6 bus from philadelphia, joined by britain angel -- civis bus. what grade. in? caller: middle school, going to eighth grade. host of you have a question for congressman gene green from texas? article will this bill ever affect my grandmother's ability to get medicare? guest: not at all. in fact, this bill shouldn't touch medicare one way or another. since 1965, medicare was created, probably the second most popular domestic programs

-- program in the country. so security is probably number one, medicare is the second one. we shouldn't impact medicare at all except to make sure we don't have also the disparities in medicare that we do all of the country. hopefully that will be dealt with. but i want to be sure we don't touch medicare. host: democratic line, len from princeton. caller: i am a retired mathematician and i have been a strong democrat all my life but i don't agree with you at all on health care. i have medicare, it is wonderful, and that want to give it to everyone. there is a bill 676 that would simply give medicare to everyone. 70 pages long as opposed to the 1000-page bill. guest: i am a co-sponsor of john dingell possible for medicare for all. if we could get that in the house and senate, i would vote for it. i'm a co-sponsor of the problem is politically weak can't get there in the house and senate.

caller: wait a minute. you never going to get there if you don't try. the trouble right now is you have all of these requirements that you want your bill to have the basic requirement that you have that you don't say, you want to preserve the salaries of health care insurance executives and the wealthy stockholders. you can't have good medicare as long as you -- good medical care as long as you -- guest: did i lose him? i don't really care much about the stockholders in the insurance companies or the salaries of the chief executives. i care about getting health care to everyone in america. that is what this bill is about. politically we have to get it passed and medicare fall will not pass the senate and may not pass the house so i want coverage for everyone. host: i want to get your reaction to an accord -- editorial in today's open "the washington post," the can't do blue dogs.

watching centrist democrats and concrete more reasons for health care can't be fixed, i've been struck by a disquieting thought -- assist -- suppose our collective lack of response to working katrina wasn't exceptional but rather than normal when america, suppose we can no longer just the major challenges confronting the nation, suppose america is now the world's leading can't the country, every nation with an advanced economy long ago secure a universal health care for citizens, an achievement that the united states among funds beyond the capacities of more man. it wasn't ever thus. time was when democratic congresses and at the social security and medicare over the opposition powerful -- guest: of this bill is paid for. it is over $1 trillion and we paid for by savings in the current medical system, almost half, but also by taxes on the wealthiest. we have a long history of health care hands single payer. all of the countries rebuilt

after world war ii with our support went to a single payer, government run. some backed away a little bit, like the netherlands. but our country may be different decision. we went through employer-based and even today we almost 60% of people covered by it. why would we throw out a system that is been with us for 60 years? i think the single payer would be immediately disruptive, we would lose quality. we need to build on the successes in our system but we need to cover everyone in our country and leave no one else -- out. host: bob on the independent line from charleston, west virginia. caller: good morning. i think there is a lot of confusion in the public. i'm on disability myself. i have time -- i watch c-span because that is where i get the best information on issues from people like you, and i'm so thankful you have the broad variety of people on their giving us expert information. the situation appears to be --

the basic impression. on the republican side in congress, my thought is that many of those people on the republican side are active defenders of the private insurance industry, and that is the agenda behind their opinion and speak. the democrats, on the other side compression is a lot of those democrats are not very economically minded and maybe a little shortsighted in the development of the legislation. so we don't know which way to go. can you tell me -- well, one thing, the information i received is that medicare as an example is far and away more efficient as a medical insurance provider than the private health care industry and what the republicans say -- it is true

that if we have a public plan, it will run private insurance is out of business, but if that is a matter of good economics then so be it, i feel. guest: medicare has literally been a godsend for senior citizens over 65. it is the most efficient because it talks about 2% administrative, whereas if you use the private sector -- and i cannot private-sector -- no -- not only administrative costs are higher but yet to make a profit. but the problem we have in congress is it is a political system. my republican colleagues, even though they wave -- may be well- meaning, just want to say no to anything the president wants. that didn't work with the war on drugs and hopefully they won't just say no to health care for all americans. so it is really going to be on

the democrats to come up with a plan, and whether it is 50 blue dogs, progressive caucus, and, frankly, i'm not a member of either -- we need to have a plan that we can say covers all americans. and that is what we are doing in the energy and commerce committee. we have a plan that will give access. if you get it through your employer, that's great. but if you don't, there will be private plans available, just like medicare advantage is available for medicare recipients but still a% people get medicare through government plant and i think you will see that. private insurance cannot handle the uninsured. they can't make a profit. that is why we need a public plan to insure we broke -- cover everyone. host: joining us from the c-span bus in philadelphia is julianne. how were you? >> fine. host: what grade are you in?

>> is great. host: do you have a question? >> my question is, if we put everyone in insurance would we have enough doctors? guest: of the my problem is we have -- wheat -- our problem is now, we need more primary doctors. juliet is an eighth grader, hopefully you go to the doctor very seldom but you do get the flu, infections, things like that, will break your legs. you need to go to a primary-care doctor and then see a specialist if it is something they can deal with it. we knew -- need more primary care doctors. the bill will plus up what we need for primary care. i have a sinus infections. believe me, i don't always need to get a specialist -- i need to go to a primary-care doctor, which is much cheaper. if we need specialists but we also need a lot more primary- care doctors in the country. host: mali on the republican line from california.

-- molly. caller: -- i am so confused by these calls -- the main issue is what obama himself said in a speech two years ago -- and i have a followup back-to-back -- after that. he said we have to look at and of life. so far the people who have called in our elderly. of course, these young children -- obama said we have to look at and of life issues, and don't worry, we will give you pain medication. america , what he is talking about and -- letting you die. someone will sit on a commission and decide whether or not you are valuable enough to get the care that you need. this is going on in england and canada at this very moment, people are just being given pain medication and sent home because alternatives that modern medicine are too expensive.

and a follow-up to that, obama's lies about how everybody is able to keep their own insurance. i'm in the private health care industry, and let me tell you, on page 15/16, under orwellian title, protecting private insurance, it says, within one year of this bill becoming law no private insurance company will be able to sell new policies and you as an american citizen will not be able to go and purchase private insurance. guest: well, for one thing, that is not in that bill. i don't know what you are reading. if the bill did not allow for the continuation of the private insurance sector, the 60% of the american people, it wouldn't pass. so, that is what is important. now, i don't think president obama lies. we want to cover everyone in our country, and if you have private insurance like you do, that's great. but i know private insurance

cannot go out to someone who is disabled and offer them a plan that they can afford. a great example is cobra -- we have had for decades. most people who are laid off or disabled can't afford cobra because they don't have income. that is why private sector and fluid -- insurance can't deal with it. we need something that covers everyone. even the people who get social security disability and have to wait two years to get on medicare, we need a plan for them, too. host: westport, took a -- kentucky. bruce. caller: everybody talks about the government running things, but who runs the fire department, who runs the police, who runs military, fta, agriculture? government. why can't they run the medical department? guest: well, there are reasons to have government.

although there are people who would rather have private security and -- but we need public police officers and our country, just like we do need medicare. the same discussion we are doing today was on the table in 1965, and like i said, medicare is probably one of the most successful programs in our country on the domestic side. granted, it is costly. granted, we need to reform it so it is still there for not only me but my children and grandchildren, just like social security. but the private sector can do it. host: carl on independent line from the twin lakes, wisconsin. caller: good morning, everybody. i have a question. why doesn't the people who are supposed to represent us for go york insurance -- forgo your insurance and get the insurance house -- that we the voters have

and see how fast you can cure our problems. guest: let me address that. as a member of congress i'm part of federal employees health care plan and it covers whether you are a member of congress, our staff, department of energy, every federal employee has the same plan that i do and we pay the same amount that other federal employees do for whatever we want -- the low, middle, were high plan. i have been fortunate in my life, i have been covered by employer-based insurance. i was in the legislature in texas, they have a similar plan. i was in the private sector for 23 years. we have health care coverage provided by our employer. congress has the same thing. now, i represent an energy refining and producing district. i have the largest exxon mobil refinery in the country. they have employer-based insurance. shell has a refinery chemical plant, they have employe-based.

so does the federal government. if we wanted to abolish -- abolish employer-based, it is fine, but i would not tell every federal or state employees or my constituents that you are going to have to go into this public plan. if you have employer-based, it is fine. for members of congress, i am going to go on medicare when i get to be 65. we don't have a choice more than anyone else. you have to be on medicare within a certain amount of months or else you have to pay a lot more so members of congress go on medicare. so, i don't have a problem with the public plan. if we abolish the federal employe use, i would have it through public. host: on site, -- skype, will hancock. caller: good morning. i read recently in man has many of his organs saved by stem cell objection from this plan has budget have anything on stem cell research -- stem cell

injections. does your plan have anything on that? guest: it does not haven't anything on stem cell research, but i'm a bit -- big supporter of its stem cell. i watched what president bush did in prohibiting federal funding for stem cell research. president obama has reversed that and we have a working majority in the house and senate to expand its stem cell research. i don't want to cloned human beings, but i do know there are organs in our body that can be reproduced, and we need to do that. we don't have an of people who donate their organs. guest: -- host: an e-mail who writes -- as side --

guest: well, i don't know if having a nice car or home is life threatening i know if i don't have health care it is life-threatening. our constitution has fairly provided for a lot of domestic issues to help people. whether it be social security, medicare coverage for everyone. the opportunity to have health care for everyone -- again, if you get through the private sector, that is great, we will continue, but if you can't get it through the private sector that needs to be public plan. host: our next call from pennsylvania. gail is online. caller: good morning. i have a comment and a question for you. one of the things you said -- you did not care about the profits of insurance or health care companies and executives and yet many of us, including many pension plans, are invested in many of these companies and actually do care about the profits. i think in some ways it is a

little disingenuous. the other thing i have is i think most people would agree that a major cost of health care is malpractice insurance. how come toward reform is not even been talked about as part of the health care plan? guest: let me get your first question first, my job as a member of congress is not to worry about the profits of insurance companies or even the salaries of the ceo's they are stockholders. i don't on that kind of stuff. as a member of congress i should not be voting base the whenever i own anyway. but we are going to have a private insurance plan, 60% of american people get their coverage from it, and that is great. they will still be there. but our concern is to try to cover the people who don't have that opportunity to get it through their of foyer or through some other way. -- employer or some other way. what was the second question? host: --

guest: malpractice reform. i practice law in texas and most medical malpractice cases are brought in state court. texas has some of the strongest laws come action in our constitution come on control of medical malpractice rates. you do not go to a typical court, you need to go to your state to do it. the 10th amendment deals with that. you ought to deal with your state legislature. host: back to skype -- mattie, are you there? what grade in school you go to? >> going into ninth grade on lake forest. host: what is your question? >> my question is, how far into the future what taxpayers be paying for this bill? guest: that is like asking how long in the future we will pay for the army and military and

protection of our country. somebody's got to pay for it, and taxpayers will pay for it ultimately. just like somebody has to pay the bill. that is our problem. we have not people pay as you go. the house today will vote on a bill, i hope, that will make congress come up with the money when we create a new program so we want continue to build our trillions and trillions of dollars in national debt for you to have to pay for it or even your grandchildren. host: we will have to leave it there. thank you for joining us. coming up next, we will talk to michael rothfeld, reporter for "the los angeles time" concerning the budget situation in california. are you there? thank you for joining us. obviously a deal was announced. what is the status of the budget deal? caller: we are waiting for it to be put together as a formal budget and then be voted on and the legislature by the assembly and senate.

the governor and legislative leaders announced monday evening, and basically they are just gradually releasing some of the details. we still know all of the details, but we know the bold strokes. it needs to go through the legislature before the governor and -- and sign it and the state consider making the changes the budget calls for. host: what are some of the key components? guest: a lot of it is cut. what officials have said are $15 billion in cuts to pretty much everything in california. education, social programs, and that includes welfare, health care, services for the elderly and the poor, and prisons, about $1 billion in cuts. across the board they are borrowing from local governments and local property tax revenues that counties and cities depend on, and they are taking their local money,

transportation funding that local governments usually gets, and also taking redevelopment from local governments. and then the other portions have to do with -- there is actually an accounting gimmick type things. they are pushing state payroll into the following year so they don't have to pay. that is a little piece they have done. a lot of funding shift and pushing stuff into the future. host: how you characterize negotiations between gov. schwarzenegger and state legislatures -- state legislators. guest: it was a little bit turbulent because the governor insisted that there not be any new taxes. and they have previously in february agreed to a deal. at that time they raised taxes, sales taxes.

the governor said this time route -- he had previously promised never to raise taxes when gov. schwarzenegger was elected, saying he does not want to raise taxes, so he did go back on that promise in february but when the budget fell out of balance again he said, i am not going to do that anymore and republicans in the legislature are anti-tax, would never agree to raise taxes. so the democrats in the legislature who wanted to do that basically agreed not to. and so, they looked for ways to cut the state government pretty significantly. but it took a while for that to happen. and they couldn't agree before the state actually have to start sending iou's to residents and businesses instead of paying the bills. host: we are talking to michael rothfeld, a reporter for "the los angeles time" on the california budget and economy in general. if you have a question, please call lynn.

i would like to get your reaction to the front page of " the new york times, analysis piece on the larger picture for california, and they write, the rest of the nation which historically looked to california as a model for fierce economic independence and free- wheeling innovation and now see the state looks like every other place, just better beaches. "we are now the state that can't," said steven levitt -- steven levy, from a private research organization. "it can't agree on is what the problem, it can balance its budget, it can't decide over prisoners as though for office -- focusing about immigrants." was a response? guest: i think it is true to a large degree because i think a lot of would make california a unique are contributing to what has become sort of a permit

gridlock in state government. one of the main things is that california for a long time allow its voters to make decisions on how to run the government, gov. schwarzenegger was elected in a voter recall, and what they call ballot box budgeting where voters go to the ballot and and say how much they want to spend on various programs but they don't necessarily provide the money to pay for it. that is something kind of like the will of the people, is very important to the california culture, but also created a situation where the state is forced to spend all of the money, the elective leaders don't have that much control and a lot of areas. that is part of it. and the other part is the diversity of the population, and that has to do with the fact

that there is a lot of immigration here and also fairly conservative population, so there is a kind of conflict between all of the different segments of california's society and people who want different things. so while it is very diverse, there are a lot of different interest groups who are fighting it out in sacramento, and it just polarizes the government's -- polarizes the government and they have been unable to break through. host: steve from greenwood on the line. good morning. caller: i have a concern, and i would like to ask of the budget is going to include reforms to the system in which metical is being conveyed to the providers. -- medi-cal. i and senior disabled and have a great anxiety over what is occurring. when i go to medi-cal provider,

there is no checks and balances. i don't know what they are sending into the state for reimbursement. is there anything in this new bill that will cover that? host: mr. rothfeld? guest: there will be reforms, where the governor is saying is reforms to medi-cal and other programs -- in home care providers for seniors, in an effort to root out fraud. we don't know all the details. medi-cal will be cut, so there will be some cut of that. i am not 100% clear what type of reforms the caller is asking about. some kind of fraud? is he still there? he's not?

a lot has yet to come out. we just know there will be some attempt to root out fraud and put more accountability. the cal-wodks program is a bigger. try to cut down fraud, bringing more accountability to force people to actually work and cut people off faster if they don't work if they have opportunities to do that. host: samantha of who is on the c-span bus in philadelphia. are you there? samantha? i think we are having a couple of problems. but as go to our next caller, debate on the democratic line from california. -- let us go to our next caller, debbie on the democratic line.

caller: would you going to do about schooling? i move it out here because it was ranked the highest in schooling projects and now they are down to past zero. my daughter can't even get decent schooling. my son actually moved down to our intercounty to get better schooling scholarship. can you answer that? guest: well, the education it will definitely suffer at every level, from educational schools to high schools and public a-12 system and also public colleges and universities which have traditionally been a very strong in california and not that expensive for people. there are going to be billions of dollars cut this year from education under this budget plan, and for the public

schools, they are going to get some money through the federal stimulus, but they are also talking about having to -- they are increasing class sizes -- summer school, and there could be fewer teachers. there is going to be a lot in tax -- impacts. but because the teachers union is very strong here, and there is a strong voter formula that was approved by the voters to fund education, so a lot of the education cut in k-12 will be paid back in the future years but in the immediate future it will suffer. host: is the problems that are having in the budget this year, will we see the same problems next year? guest: a lot of going to depend what goes on with the economy, because california's revenue is

highly dependent on income taxes. that is what the main problem has been, while -- why in the deal fell out of balance. one of the reasons why it fell out of balance of with the because income taxes continued to decline. the pattern in california has been -- and this has been going on for some time -- is that when the economy goes well, income taxes flow into the state coffers and they have a lot of money and they traditionally increase spending. and then when the economy goes south, they don't have that in, so they just have serious problems. so, it is kind of a boom and bust cycle. something the governor has often talked about. they are trying to do some things to stabilize that. there is a commission on the state -- state taxes to try to figure out how to restructure the system so it is more stable here, but that is not something, if that happens, will happen in time for next year. a lot of it depends on the

recession and what happens with that. host: we will try to go to the c-span us again in philadelphia. samantha, are you still there? what grade and what school view go to? caller: i am an upcoming freshman. host: what school do you go to? caller: --high-school? how is the u.s. opposed to keep up with -- host: how can the u.s. keep up with education if we cut back on spending? guest: i think that is a really good question because some of the things some of the critics say that if you take away money that is supposed to educate people and that has a trickle- down effect basically for the future, it takes the kids who

are supposed to grow up and be productive and earn money and contribute taxes to the government and invent things and do a lot of productive things for the society, it takes away their ability to do that. so, in fact, it has a long term in fact, negative affect on the state and the society. that is what allowed of the critics say as far as why it is not a good idea to cut from an adjudication, and there are maybe other areas that should be cut. one of the areas that allow the people in california have not wanted to cut is will law enforcement. the state spends a lot of money on prisons, about $10 billion a year, so that is something that is valued by the society but there are people who say, well, you are spending so much on prisons and then you take money from education, and, you know,

theoretically it drives people into the wrong direction and kind of fervors that cycle where some people would go to prison -- not that obviously it would have been for most people, but on the lower end the, it could push people in the wrong direction and just have a long term affect. host: tampa, fla., john on the republican line. caller: good morning, everybody. doesn't it scare you to death that the democrats want to make illegal aliens citizens and they are drawing off all the benefits that they never put in, and that will -- it will be in worse shape next year if they become citizens because they are going to get all the benefits and they will spend the money back to mexico that they made any way, so i just can't look forward to what is going to happen next year if the democrats pushed for

amnesty -- like charles schumer or somebody, looked for amnesty. it is just scary. but education is another thing, because my wife is a teacher. it is not money. we spend like $13,000 per child, so you have to get the parents interested. if they can't speak english themselves, however going to help the kids? guest: well, that is a big subject of debate here. and the illegal immigrants are here -- and there has been a huge amount of population growth of the slive because of that and it caused the state to spend more money. but it is unclear exactly what the cost of providing the benefits is to give legal immigrants. there are definitely billions of dollars in education and social programs that the state spends on that. nobody knows exactly what the number is.

and there is a very strong anti- immigrant sentiment among parts of california society. but there is also some fault on the other side that the amount that the economy benefits -- because not all the money goes to mexico or other countries -- there is money spent here on illegal immigrants that are working, and that creates -- big actually helps the economy -- it actually helps the economy. there is not a definitive answer whether it costs more for the government to pay for services used by illegal immigrants than they actually contribute to the economies. so, there has been some efforts by the governor to cut back on some of the services. i am not sure how much -- i am not sure that much needed to the final budget deal, though. host: joining us on skype is

jackson. are you there? >> yeah, hi. host: what gregory and and what school -- what grade are you in and what school? it is breaking up a little bit. but see if we can hear your question. >> in your article governor schwarzenegger's said cutting spending the california government is being more efficient, with loss of services -- guest: i missed the last part of that. host: let us go to andy on the calif -- audit that it reduces the number of teachers, makes cuts for health care for seniors who are vulnerable and other vulnerable

people and it seems like many of these cuts could have been avoided if there had been modest increases in taxes but the republicans who have a veto would not vote for that for the sole reason is they could not then be elected in their next primary. i would like reaction to that. thank you. guest: he is right in a sense that the republicans refused to raise taxes. i can't describe motive because i think a lot of them philosophically believe that they should raise taxes because it is going to hurt the economy more if you tax people more in california. but that has definitely been the sticking point in the budget negotiations for the last few years and for a long time. as he mentioned, california requires a two-thirds vote to

approve budgets, so the republicans do effected lee have a veto over the budget even though they are not in the majority in the legislature, the democrats control the legislature. but the governor is a big part of it, and when he was elected he rolled back the car tax, which is a tax that charges motorists on the values of their cars and a previous governor, gray davis, who was recalled, agreed to increase that to the old levels and schwarzenegger rolled it back. the tax issue has been a huge issue here. it is philosophical for some people in terms of whether or not they think it is the way to go. democrats often do and the republicans generally don't. in fact, in the february deal they increased tax -- not

loopholes but exemptions for corporations. and when -- democrats were calling for those to be rolled back. host: you referenced some of the budgetary rules california works and appeared in today's "the washington post," a headline. from the tarnished gold stead come a lesson for washington. he writes, california's problems appear, -- chronic --

changes to put the state on a sound fiscal footing. beyond that, the ballot initiative process in california has lost legislators and gov. into spending requirements and allocations that reduced flexibility when times are tough. voters rejected a package of schwarzenegger-backed initiatives in may that would designed to deal with the current crisis -- "i'm beginning to think it is impossible to be successful governor out their satiric he said, too many impediments. what is your response? guest: that is what they have been talking about here. there is a movement to have a constitutional convention to try to write some of the rules that the state government operates under. and the thing that people have been saying over the last year or so is just the point that he was making, which is, is california a governable state. when gray davis was recalled,

gov. schwarzenegger said he was going to come in and take control of sacramento and push away the special interests, but the state finances under control and bring the government back to the people, those were the promises that he made. but in the end, he ended up having many of the same problems of the man that he was replacing. he said he was going to save a lot of money by making government more efficient. that was not something that he was able to do in the beginning, so governor schwarzenegger himself has acknowledged that he doesn't have enough power necessarily to do what he promised to do. so, those structural impediments are something that, there is a big push to change. although, it is unclear whether that is actually going to happen once this whole recession improves and the money

starts coming back in. people go back to the way things were before. another big piece of that is proposition 13, voter-approved initiative to limit property taxes on the local level, and that is something that pushed a lot of the responsibilities of to the state. one example of the way voters limited the options that the government has to deal with the state's problems. most of you think this will impact next year's governor's race -- host: do you think this will impact yet -- next year's government -- governor's race? guest: absolutely. this has been an issue for two years and we are getting toward the end of this year and next year -- and the governor's race has already started. but next year it is really going to get heated.

and a lot of these issues are going to continue to be discussed because it is not going to get better. these cuts that are being imposed will continue into the next year. so, i think the question for the governor's race should be, what is your vision for california, and are you going to be able to govern, and what direction would you take? would you want to increase taxes, a key to these levels of " reduced services that californians are going to see now and how you going to fix the system here and try to bring some control over it again? i think all of the candidates, regardless of what party they are in, are going to have to confront the issues. host: upland, calif., ralph on independent line. caller: i am a college professor

from california community college and we are having a major problem. we are getting people from the uc system and california state university system and that the same time you get all of the blow that from the four-year institutions -- blow back from the of four-year institutions. we don't have the capacity to handle this. we don't have the capacity to handle people who are trying to get vocational training. and i fear that because of what sacramento has done, that they are determining a lower standard of living for the entire state and the future, lowered labor productivity. i'm an economist, so that is what i tell my students. i have my own theory about what to do about this. the legislature and governor should have no pay until they correct the budget problem.

that is my solution. guest: well, -- well, the governor doesn't have any pay right now, he is a former movie star and very wealthy so he already sacrificed all this money so that will really not be an incentive for him. it would certainly be an incentive for the legislators. and one of the measures that was passed in may -- five out of the six were rejected, but the one that did pass said that if the budget is late, the legislate wars -- or the elected officials, rather, would not get paid. but, you know, there's always ways around that. so i'm not sure how effective this will be in fixing the problem. at one of the things that did pass last year was a measure to

redraw the legislative district lines and to try to do it independently. again, it is unclear how effective that will be but the purpose is to try to make the legislative districts more moderate, because right now they are kind of drawn along party lines, and to make them so that it is not just -- you have to cater to the most extreme to win a primary, whether it is republican or democrats -- and hopefully that will bring a little bit more consensus in the legislature to actually get things done. another piece is the initiative process that is sacred in california. no politician wants to touch it. as i mentioned earlier, there is some talk of trying to -- when voters approve a new program, to try to ensure there will be a funding stream in there to do that.

and there is also some talk of rolling back the two-thirds vote requirement for the budget so that the -- it can be approved easier. that might make it easier for the state to function. host: detroit, michigan, john on the republican line. caller: how are you doing? i have two questions. medical insurance for pre- existing conditions, the government says insurance companies will do that. i have a pre-existing condition , five insurance companies said they are willing to cover me but one says there is a federal law that they cannot cover me for 12 months. i am wondering if it is a federal law come if the government can get away with that -- one of them they covered and they were all gone to charge me when to the $16 a month -- $160 a month. so why couldn't the government of independent insurance from a saying i'm bringing you 40 million people, cut me a deal,

what kind of deal can i get for all of these people so the government will just have to pay a check once a month and they would not have to worry about -- drafted a $100 this of $50 for this doctor. guest: well, i am not really an expert in the health care system. so i don't know if i really equipped to answer that question. host: we will go to our last call from santa barbara, california. carol on the independent line. guest: i heard you mention something about the governor cutting service for the blind, elderly, and disabled. i mentioned there is about 40% of fraud in there. however, in order to get on the program you have to be on ssi and the doctors have to decide what you need and that is

authorized by social services department and the social worker. with all of that, i don't see how there could be all of that fraud there at all. i would like to know. guest: and we don't know exactly how much fraud is in the program. the governor used the no. 25% from. but it is not something that he has actually a foundation for, it is speculation. there have been at the local level by the district attorneys in different counties, investigations of fraud in the program. essentially involves people -- relatives can care for, in some cases, the elderly or dissipate -- disabled people will qualify, so the idea is that they sign up in some cases to care for their relatives who, in fact, may not need the program or not actually providing the care and they get paid by the government for that.

the cuts to the program was scaled back from what the government originally proposed. he was talking about cutting about 60% -- i don't know, in the round numbers, but essentially the program allows people to have a home care worker, and, depending on your level of disability or your level of need, on a scale of 1 through 5, he was going to cut off anyone who was 3 and under, which included some fairly bad off people who needed care. that was reduced a little bit. i think anyone now in the first signs at levels of care will be cut off from the program. and as far as the fraud peace, they will be fingerprinting recipients and providers -- as far as the fraud piece. amputees will not get fingerprinted. but it is essentially an effort to scare off people who may be doing bad things and just not really entitled to the benefits.

caller: i have a follow-up question. the blind, elderly, and disabled are not criminals, they are trying to survive. entitlement it's a safety net for our society, for human rights basically that people have a right to live safely in their homes, and they are cutting the pay rate for the providers and the workers. if they do that, then they make the recipients subject to more abuse, particularly financial, because the people can't afford to make a living -- they will take what they have to. guest: yeah, and that cuts to the core of the issue here, is to californians want to pay for services that the state has offered for a long time?