it was a tax cut that showed up about four months ago. we also cut taxes for small businesses on the investments they make and substantially increased loans through the small business administration. another 1/3 of the money and recovery act is for emergency relief that is helping folks who have borne the brunt of this recession. for americans who are laid off, we expanded unemployment benefits, a measure that has made a difference in the lives of 12 million americans. we are making health insurance 65% cheaper for families that rely on cobra while they are looking for work. four states facing a historic budget shortfalls, we provided assistance to save jobs of tens of thousands of teachers and police of a sears and other service workers. these 2/3 of the recovery act have helped people whether the worst phase of the recession while sitting jobs in stabilizing our economy. the last 1/3 is dedicated to the

vital investments that are putting people back to work today, to create a stronger economy tomorrow. part of that is the largest new investment of infrastructure in america since eisenhower build the interstate highway system back in the 1950's. these are jobs rebuilding america, operating roads and bridges, renovating schools, and hospitals. as we put an end to this recession, we have to consider what comes next.

we need help -- health insurance reform that brings down costs, provide more security for people who have insurance and affordable options for those who do not. we need to provide incentives to will -- that will bring new energy sources for our industries. that is where the jobs of the future is, and that is a race america must win. we have a lot further to go. we will not have a true recovery as long as we are losing jobs, and we will not rest until every american that is looking for

work can find a job. i have no doubt that we can make these changes. change is hard appeared especially in washington. we have a steep mountain to climb, we started in a deep valley. i trust the american people been there commitment to one another and courage to face adversity. we have seen already that strength of character over the course of this recession. across the country, people have persevered even though bills have piled up and work has been hard to come by. i have met americans who have kept confidence in our country and our future. that is how we pull the economy back from the brink and turning the economy around. i am convinced we will see a light at the end of the tunnel. thank you very much.

>> president obama traveled to mexico today for a two-day summit with the united states, canada and mexico. later he will attend a dinner with the mexican president and the canadian prime minister. stay tune for continuing coverage of the economic summit. this month, cspan2 book tv weekends continue. monday night, edmund andrews and others.

>> how is c-span funded? >> by donations? >> federal funds? >> may be private contributions. >> i don't know. >> from commercials? >> advertising? >> helices been funded? 30 years ago, america's cable company created c-span is a private business initiative, no government mandate, no government monday. two u.s. journalists detained in north korea right arrived home thursday. there were accompanied by president bill clinton who secure their release after meeting with korean president kim jong ill. they were held for five months. first, their arrival in california, and then we will have their comments and remarks by former vice president al gore, followed by a statement from president obama here in

washington.

[applause]

>> 30 hours ago, euna lee and i were prisoners in north korea.

we feared that at any moment we could be sent to a hard labor camp. and then, suddenly we were told that we were going to a meeting. we were taken to a location, and when we walked in through the doors, we saw standing before us president bill clinton. wheat were shocked, but we in new instantly in our hearts that the nightmare of our lives was finally coming to an end. and now we stand here, home, and

free. euna lee and i would like to express our gratitude to president clinton and his wonderful and amazing team, including john podesta, justin cooper, and the united states secret service, who traveled halfway around the world to secure our release. we would also like to thank president obama, secretary clinton, vice president gore, who we also call "al." the swedish ambassador, the

people at the u.s. state department, who worked so hard to win the release of their fellow americans, steve being and his crew and the dow company. i know i am for getting a bunch of instrumental people right now, forgive me if i am a little incoherent. to our loved ones, friends, colleagues, and to the complete strangers with the kindest of hearts, who showed us so much love, and sent us so many positive thoughts and energy, we thank you. we could feel your love all the way in north korea. it is what kept us going in the darkest of ours. it is what sustained our faith that we would come home.

for the past 140 days, they have been the most physical and heart wrenching time of our lives. we are very grateful that we were granted amnesty by the government of north korea, and we are so happy to be home. we are just so anxious right now to be able to spend some quiet, private, time, getting reacquainted with our families. thank you so much. [applause] >> ladies and gentlemen, the families asked me to say a few words. on their behalf, all of us and on behalf of the staff and families of current tv and my

founder, we want to welcome laura and euna home. we want to thank president clinton for undertaking this mission and performing it so skillfully. also, their team, also to president obama, countless members of his administration have been involved in this effort, to secretary clinton and members of the state department, several of whom are here. they have really put their hearts in this spirit is speaks well of our country, that when two american citizens are in harm's way, that so many people would put so much aside and go to work to make sure that this has had a happy ending. we are so grateful to all of

them. to the thousands of people who have held laura and euna in their praise -- in their prayers, we are very grateful. all the folks who made the flight possible, we say a word of the deep thanks as well. this has been an ordeal for them. i want you to note, your families have been unbelievable. passionate, involved, committed, you will hear a lot of stories. to everybody who has played a part in this, a special thanks

to president bill clinton, my partner and friend. ladies and german, thank you for coming out here. we will let these families have a proper reunion. thank you for coming out here. >> good morning, everybody. i want to just make a brief comment about the fact that the two young journalists, euna lee and laura ling are backed safe with their families.

we are extraordinarily relieved. i had an opportunity to speak with the families yesterday, once we knew they were on the plane. the reunion that we all saw on television, i think is a source of happiness, not only for the families, but for the entire country. i want to think president bill clinton. i had a chance to talk to him for the extraordinary humanitarian efforts that resulted in the release of the two journalists. i want to think vice-president al gore, who worked tirelessly in order to achieve a positive outcome. i think that not only this white house is happy, but all americans should be grateful to former president clinton and vice president gore for their extraordinary work.

my hope is that the families that have been reunited can enjoy the next days and several weeks, understanding that because of the efforts of president clinton and vice president gore, they are able to be with each other again. we are very pleased with the outcome, and i am hopeful that the families will be able to get some good time together in the next few days. thank you very much. >> president obama travels to mexico today for a two-day economic summit with canada and

mexico. the president has a meeting today with the mexican president, and later he will attend a dinner with the canadian prime minister and the mexican president. in news conference is set for monday. stay tuned for continuing coverage of the economic cut -- economic summit. >> tonight frank rich reflects on 15 years of political columns for the new york times including his look of the future of the internet from 1995, the whitewater hearings, and his call following 9/11. tonight on cspan3 >> i look at british politics from the bbc, including mp scandal, and debate over military operations in afghanistan. tonight, nine eastern and pacific on the c-span. >> now, a senate hearing on autism research.

pop tom harkin of iowa chairs the appropriations subcommittee. this is two hours, 15 minutes. today's hearing is on autism. regarding research, treatments and interventions. the cdc estimates that one out of every 150 children to share will be diagnosed with autism. among boys, the rate is even higher. we don't know what causes this disorder. most researchers agree there is a genetic component in some cases every discovery seems to

raise more questions. we still don't know what the triggering mechanisms are. and some experts think environmental factors are in play. maybe during gestation. we know a little bit more about interventions. some behavioral interventions in to help. we are nowhere near a cure all. this subcommittee has taken a strong interest in recent years. the fiscal year 2010 appropriations bill that was approved by the committee last week include a range of activities related to what some such as outreach and education, surveillance, medical research, and the inter agency autism

coordinating committee. it also includes $40 million for a new program to help students with intellectual disabilities make the transition to colleges and complete their post secondary education. and how to address the needs of growing population of adults with autism. let me thank all of the witnesses for coming here today. senator cochran is on the way and i will lead -- leave the record open for his introductory statement. we have two panels. the first panel is dr. thomas

insel. va.. ms. dana however some from iowa. i think we covered all the aspects of you want to cover on autism on these two panels. first we will open up. as with all of the people testifying this morning, your statements will be made a part of the record in its entirety. we will ask you to go ahead and proceed as you so desire.

>> i am honored to be here the other panelists. i know this is a very busy time for you and your colleagues. we appreciate your taking time here in the middle of the summer to hear about the latest research and the latest challenges with autism. the brief is to get you -- you a quick update on the research as we last met which is a little more than two years ago. this has been an extraordinary. with a lot of exciting progress. we are going to try to review the. the testimony i hope will be submitted to the record. rather than reading that, i thought i would take you very quickly through three questions. what we know at this time? what we need? what do we doing? we will try to summarize this very quickly. today you on track here, let me make sure we are all on the same page. autism by definition start by age three. we are talking about three

different kinds of symptoms that characterize autism, reduce social behavior, abnormal language, and repetitive restrictive behavior's that often are called steer at peace. these are the definitions that many children come in with additional complicated features. i listed a few of them here. 20-30% will have associated seizure disorder that can be part of the autism syndrome. intellectual disability in various sorts. we have many families were concerned about gastrointestinal problems of many different kinds. about 10% of children who have an autism label have odd faces or appearances, we call this is more thick. somewhere between 10% and 20% have regression.

everybody may regress to some degree. some seem to develop quite well for 18 months and then will lose language and function. the results of understanding these complicated features and the fact that this is such a heterogeneous syndrome is that we increasingly talk about all systems. there are many -- autisms. sometimes we are prisoner of our own language by thinking of it in the singular term. the term has been most widely accepted, the autism spectrum. all that means is that we are talking about a range with in the syndrome from those children who really have very limited functions and very little -- very really have limited language or severe debilities and they should no interest in social interaction. there are lots of motor after

nemeses like hand flapping. they are the ones often have these distorted features. at the other end of the spectrum are children who are going to graves to be often highly successful. they may have social awkwardness or be called nerdy or more interested in numbers, but they may be tremendously useful and successful and made huge contributions. these will be areas that will allow them to use their oxygen to its best, which is the ball mechanical and numerical and less social aspects of the world. all of those people -- let's

dive into what do we actually know what we have learned. i think there is wide recognition that this is a developmental brain disorder. we do not know yet where in the brain or what in the brain or went in the brain things go off track. the most recent research would suggest that what we are talking about here is not a specific region, but it may be more likely a problem of brain connections. that may be very diffuse. it is quite possible that the reason you see problems in language and social interaction is that those are functions that require the greatest numbers..

secure connections are not working, he can see deficits in those kinds of functions. there is been -- the@@@@@@@@r@ that hasn't necessarily deliver the cures that many of us -- of us have been looking for yet, but it has helped us to understand the disorders. two years ago, i talk -- i talked to you about this. we would have said it is important because we know that a couple percent of children have recognized syndromes, these are single gene mutations which perhaps 50% of the children have a diagnosis of autism as well.

discovered a range of other rare but had a significant mutations. they are in the form of structural genomes seem to contribute. where two years ago and may have said 5% of any population of children with autism would have won in the syndromes, i think now we can say that number is 1 to be considerably -- adding now we can see that number is going to be considerably higher. there are new reports out about where mutations that may explain another 1% or 2%. there is clearly a genetic factor at work here. it does not explain all of autism. we still need to learn a lot more about how genes and environments interact. there will be more research about that in the future. that is an important area of progress. we spoke about this two years

ago. as you said in your opening remarks, interventions are helpful. they are helpful when started earlier. the one to find this, because i think the issue here is making sure the best behavior of interventions are available to people who need them. we are not talking about children but also children transitioning into adult and adults themselves. these to work but they are not always available or paid for. we didn't have a conversation later about how that is going to happen. -- we do need to have a conversation later about how that is going to happen. we are sitting in a bar for how far these behavioral interventions will go it done early. the issue that you broke up -- brought of the opening remarks is one that is of great concern to you is the increase in

problems. the centers for disease control and prevention now reports from 2007, a rate of 150 children being given a diagnosis. something on the autism spectrum, i do not think that number is a great variance of numbers we have seen elsewhere. it is also true that is about a tenfold increase over the numbers coming from the cdc. the increase is of great interest to many of us. i want to caution you that a change of prevalence is not unique to autism. we have seen a 40 fold increase in the prevalence of pediatric bipolar disorder. we have seen a tenfold or greater increase in detention -- and attention deficit hyperactivity disorder.

this kind of a change is not unique to autism. it is certainly one that deserves our attention. we have to remember the difference between prevalence, which can be diagnosed by change in diagnoses, that could be a crew increase in the instances. that is an area that requires more research. that is what we know, what we need? part of what we need is filling in the gaps of what we do not know in taking you through the kinds of things we are talking about and understand more about the risk architecture of the whole spectrum. genes are important. environmental factors are important. most important will be how they interact. that is not unique for autism. that is true for autism -- for asthma, etc.

new therapies and began to emerge. we want to understand this. the point is to be able to develop ways of protecting this disorder -- detecting this disorder much order. brain disorder behavior is one of the last features to change. that is true for alzheimer's, parkinson's, huntington's, and it will be imported to move upstream by having a biomarker allow us to detect risk in disorders much early. we want to have interventions such a more effective. behavioral interventions are fitted for many children but they are expensive, expensive -- extensive, and take a long time to work. we want to offer more than behavioral interventions. we want to know what he meant to work best for what people. you'll hear a lot about personalize medicine. we are hoping that the new

director will be confirmed by the full senate this week. should that be the case, i think you will hear from him that there is a high priority. impersonalized money. -- there is a high priority put on personalize medicine. as you mentioned in your opening remarks, we have a whole wave of children of what is in that will soon be adults with autism. how we make sure that they have the access to services that we take care of this transition and the coverage deserves urgent attention from this committee and from others who make policy. luscious a little bit about what we are doing. i will tell you -- let's just talk a little bit about what we are doing. i will tell you that we are working with the coordinating committee. . .

what happened there after with the american recovery and enforcement act was the opportunity to make some new investments to jump-start this plan, focusing on the short term objectives. we hope that within the next six weeks to be able to announce publicly the large number of grants that have been funded through the american recovery and reinvestment act. these include the special rfa to support new autism orders --

research, and a large number of challenge grants and grant that opportunity awards that will be made and will be announced before september 30th of this year. we also tried to jump start this progress by creating the national database for optimism research. this will be a meeting ground electronically for scientists around the world to share the tools and progress. there are really six questions that guided the effort to steer research, and to help us think about what the most important issues are. the iacc, which was charged with through the combating autism act of 2006 includes about public members and federal members. these questions came out of a very rich discussion about what

is it that families and people most are looking for? we have taken each of these to heart and have come up with a summary and what we need for these six questions. we have short and term -- short- term and long-term objections. i will finish with this vision statement from the strategic plan, which talks about what we are trying to do as we move forward. we are trying to inspire research that will improve the health and well-being of the people across their life span. this plan will not only provide the road map for research, but also set the standard for public-private cooperation and

for engaging the broad community, who will be so invested in making sure we expedite research progress. i will make one final comment. thank you for the many things you have done for autism and for many of the other issues you deal with. i would like to send a personal thank you for giving us ellen murray. i understand this was a lot to give up and offer, but for those of us at hhs, it is a terrific gift. we are delighted you decided to share her gift with us. >> thank you very much, dr. isel. isel.

we have had hearings before but it is very important for us to join forces with the victims and their families to make sure we try amp, and don't let the victims and their families and down. thank you for being here to lead it all. >> lead it off. >> thank you again for your leadership. on the interagency coordinating committee, just looking at the list of people on the committee, as you know, our interest obviously is in research and finding causes, which hopefully will lead to prevention. also, we are interested in the early intervention programs and how you get to these kids early. do you have enough expertise on this panel in terms of, or you

are looking at that aspect also? water the most effective early intervention programs -- what are the most effective early in a region programs we can find and work on? >> do we have the expertise? we bring in the expertise. each year we have to update the plan, and we do that by bringing in the experts in all the areas we are concerned with. we have heard about both ends of the spectrum, early detection and early intervention. as one of the places that needs a big push, the other end is adults on the spectrum who need a lot more in the way of interventions. >> which treatments and interventions will help? your group is actively out there looking at different

interventions and trying to find out which ones work best, and all our -- are you also promoting -- or you instigating different types of early interventions to track them and see which ones work the best? >> let me just go through the process very quickly. the first thing we did was to do a portfolio analysis. this was unprecedented. in the questions of interventions or any other aspects of those six questions, we asked all the federal players, including the department of defense, but also the private groups which are very substantial players for autism. they are putting in significant amounts of research dollars. for the first time, everybody had shared their information about every grant a fund, how much they are putting into it. we were able to use that to map

on to these six questions and see what is missing. one place where it looked like we were under invested across the sixth question is this area of interventions. how we feel that in? the first thing we do is bring the experts, at least on an annual basis, to tell us not only with the needs are, but what are the opportunities? what is really hot right now in terms of techniques, or things going on in other areas of medicine? the meeting this year will be on september 30 and october 1. we did a previous one which would have been in january of 2008, if i have that right. we used four days to hear from a broad panel of experts. i might add that is not only your typical academic grantee that we are hearing from. we are bringing in family members who may have had a very interesting experience that they think we should hear about. we are bringing in conditions as well who may be trying things we

do not know much about yet. -- bringing in clinicians. we are making sure we get all the best ideas on the table before we decide what to recommend for nih@@@@@@@@@ @ @ being successful but how early an age but can you start that,? do we know what age you should start that at? >> i will duck that question, because the world's expert is behind me and you will talk to dr. dawson in a few minutes. she has completed a landmark study on just that question. i would love to steal her thunder come about because she is a friend, it would be better for you to hear from her.

>> i hear a lot about this issue of vaccines in autism. can use summarize the state of the science? about this issue of vaccines and optimism. can you talk about the science regarding that issue? >> what we know is that there is no question from the community that there are internal factors at work, and that some aspect of the environment is going to be interacting with genetics to make children and maybe even unborn children vulnerable. it may be that these are prenatal internal factors. the only factor that has been explored in great detail would be vaccines. part of that has to do with an increasing number of vaccines. it has gone up over the past 30

years or so. i have made a slight so you can see what that looks like. there has been an extract -- a striking increase from 1900 until about 2009. there are more vaccines now in the recommended schedule. there are more injections that are possible currently. it is also important to realize that while the number of vaccines have increased, the quality of vaccines has really changed in the same time. if you look at the number of antigens that go into these vaccines, although it does not show it here, the amount of protein that goes into any -- into the full group of vaccines that children are receiving is less than they were when you are getting a single shot in 1900. the vaccines are for more refined and targeted. they look very different than they would have even when your

children would have been vaccinated in the 1970's and before. it is not quite comparing apples and apples when you look at this change over time. the research that has been focused on vaccines has a potential association with optimism has been largely epidemiological research. up until this point time, there have been a total of about 16 studies involving hundreds of thousands of children. there is no evidence at this point of any association between vaccines -- the number and kind of vaccines and any of the things we are showing here and the increase or particular vulnerability to of schism. -- our vulnerability to optimism. >> how you can have a study of

hundreds of thousands of vaccines -- if you go back to your first chart, i have a chart from the center for disease control and prevention that shows that in 1983, the maximum number of vaccine doses administered before age two was 8. in 2009, it is a minimum of 21, maximum of 29. from everything i can ascertain, it is closer to 29. so we have gone from eight in 1983 to 29 this year, before the age of 2. most pediatricians do that. so how would you ever find a group of kids that do not get those?

there is a striking decrease. these are not the same formulations. they are not the same kinds of vaccines. what we are talking today, while the numbers have gone up, is a profound reduction in the amount of protein and the number of antigens. >> some of these vaccines were not around in 1980. we have a number of them here, some of these were not even around. hepatitis a -- they were not around in 1980. next the vaccines that were around in 1980 have been changed in many cases. they are not actually the same vaccines in many cases. >> they are the same. >> they are not the same. they may have the same names, but the formulation has been greatly refined. that is how you get these kinds

of changes. >> i get confused in this area. i just want to focus on the number of vaccines, and the fact that they are sometimes put together before the age of two. i am not talking about that antigens, just the total number has gone up. i do not know of any studies that would compare a cohort of children from 0 to age two that did not get the shot and the incidence of autism. and those that did receive 29 vaccines and that did come down with optimism. i do not know of any study out there that has done is -- that did not come down with optimism. >> could we now a study of vaccinated vs. undetonated children? we do not have a vaccine expertise on that committee. we had decided to consult a

federal advisory committee that reports to the secretary to get their expertise, because they do have it. we met about a month ago to have this conversation with them. before meeting with them, we said then the question, saying has there been such a study? just the kind you describe. if not, why not, and could we do such a study? their first response to us was, first of all, and has not been done. they did not think it was feasible to do it, but they did not think it was ethical. they had real concerns about the ethics of randomizing a group of children to not receiving vaccines, because they were concerned about the risk involved in not vaccinating a large number of children. you would need a very large number for such a study. >> so we really cannot tell that. i do know of people now with children who are not letting their children get those numbers of vaccines.

some of these are highly educated, professional people, and they have decided -- they will not give it to them by the age of two, maybe up by the -- may be bought age of five or six. i know a lot of that is happening out there. a lot of pediatricians will not treat a child if, in fact, they are not getting these immunizations that -- will tell the parents that if you do not agree to the vaccination schedule, you cannot be a patient of mine. i know a lot of people that basically are not having their kids vaccinated. i do not know the ramifications of that. i just know that is happening. >> the problem is that we cannot know if 29 vaccinations by the age of two do have an effect. we do not know that.

we are not only from those who are convinced that vaccines are the problem but those who are not. we have both ends of the spectrum. we hear from lots of families who have a child with autism and are wondering what they should do about their next child. that is often a question on the table, because they do not know who to believe and who to listen to. the group of people who feel that there really is an issue here and that we ought to be concerned because there is a relationship between vaccines and optimism point to the numbers, the large increase. all 16 studies demonstrate a relationship. however, those are all epidemiological studies, and you cannot rule out the possibility that there is a small signal there that might have been

missed. on the other side of the coin, the other end of the spectrum, we are hearing from other people, not a scientist, but even family members on this committee who are saying enough, already. if there is an internal factor at play here, and we have spent a lot of money and time during the 16 studies and nothing has shown up on this question, maybe we do not need to turn that rocked over a 70 time. let's move on and look at something that is more likely to shed light on what could be an important factor in increasing prevalence or the risk for autism. that is what we are hearing. we are trying to balance both of those points of view and also trying to make sure there is information available for those who are concerned about what to do with their next child. >> early interventions and how

we help people right now who are having trouble dealing with children. we have to focus on those early intervention programs. we will get to that in the next panel. >> i want to join you in welcoming ininsel to the hearing. we have had hearings in the past to try to develop a body of information that will help us identify better ways of dealing with autism. are there other causes? what are the possible changes in environment or nutrition, health care generally that we can turn to for help in dealing with the challenges and difficulties that optimism brings to our

society -- that altruism brings to our society. going on television, inviting people to contribute, and some of the experiences i had then, observing the children who were victims of autism and talking with families and getting to know more about it really made a big impact on me and how challenging the situation really is. my heart goes out to those families who are dealing with it, and i just want to be here today to support the effort to identify how government can be more helpful. what are the other possible causes for autism, and what are the things we can do? and to continue to work and not give up. a lot of people have invested time, ever, research dollars,

personal energies, to cope with this situation. i am curious to know from you, is there hope? have we discovered things and learn things over the last several years as we have been embarked on this joint effort that give us any hope that we are making progress? >> absolutely. there is always hope, but there is even more than that right now. there is very rapid progress. i think is next. time is going to be even more extraordinary -- this next period of time is going to be even more extraordinary. in 2008, our budget for autism research went up, and it will go up even more in 2009 because we are seeing this recovery act effort. we have put money specifically into an all it is requests for applications through the recovery act.

the only disease specific such request in the recovery act from nih for this year, this is the one that does have a disease name on, because we realized that there is an urgent need, and equally important, there is a tremendous opportunity right now for progress. we have the tools we need so we can really start to move quickly. we want to do that over the next two years. >> thank you very much for your efforts and being involved as the director of the institute of mental health. we appreciate your being here with us this morning and helping us fully understand the challenges we have ahead. >> thank you for your interest and support. >> would like to call our second panel. i did not talk to you earlier about this, but if you have the time to stay, i would appreciate that. if you could stay for a second panel, i would appreciate that.

>> i would be happy to stay, and most of all i want to hear the copal analysts, because i think all of us need to hear some of all of us need to hear some of the@@@@@ y nh vmv david miller, and dana halber som. thank you all for being here. some of you have come a great distance. if you could summarize five minutes or so i would appreciate it very much. you kind of summarize, 5 minutes or so, i would appreciate it very much. we will just sort from left to right here, dr. geraldine

dawson, the chief science officer for autism speaks. dr. dawson received her ph.d. from the university of washington. thank you very much, and please proceed. >> good morning, mr. chairman. i want to thank you for inviting me. i am very honored to appear before this subcommittee, and i want to thank the committee members and you for your leadership in providing full funding for the combating autism act, and also for your most recent fiscal year appropriations bill. this year, more children will be diagnosed with autism, as you may know, than with age, diabetes, and cancer combined.

autism research, however, is still significantly underfunded, despite greater public and congressional awareness. for example, leukemia affects one in 25,000 people, but receives research funding for $310 million annually. pediatric aids affects one in 8000 children. its funding, 200 feet $5 million a year. autism, as you know, affects one in 150 individuals, individuals,nih funding for fiscal 2009 is estimated to be $122 million. as you have heard, most scientists agree that autism is caused by a combination of both genetic risk factors and environmental factors. we have discovered some of the autism risk genes, but we still know very local about the role of the environment and how it interacts with these genes. we have come to understand that optimism is not one disease, but

many different diseases. has many different causes, and each costs will likely only explain a minority of cases. piece by piece, we must discover each of these causes so that effective treatment and prevention will be possible. to identify the causes, it will be necessary to invest in large scale, population based studies that broadly examined genetic factors and internal trekkers, such as the nih national children study. it will be important to invest in large skillet databases such as the national database for autism research, the genetic the resource exchange, and the resource exchange, and the op autsim tissue exchange. research suggests that it may be the connection between brain cells. some of the best it is in the

world are working hard at understanding how genetic mutations can change the way in which neurons communicate, and they are developing therapeutic strategies that might restore the function of the synapse. all this work is offering real hope, the pace of discovery is simply too slow, in large part because of lack of adequate funding. we can now screen for autism at 18 months of age. of his and speaks is funding several clinical trials that are evaluating interventions for at risk infants who are as young as 12 months of age. the hope is that by detecting autism early, we will be able to reduce its severity or even prevent the syndrome from developing. however, the impact of this work will not be felt less pediatricians are using the available screening methods, and parents have access to train professionals who can deliver these interventions.

that is why it is critical that we continue to study dissemination methods, invest in training professionals and caretakers, and support federally mandated insurance coverage for behavioral interventions, which we know are cost-effective in the long run. all behavioral interventions or effective for some individuals, most individuals with autism suffer without relief from the optimism itself and a wide range of medical conditions such as sleep disorders, gastrointestinal problems, and epilepsy. very few clinical trials have been conducted that address these medical conditions, and virtually no cost effectiveness studies have been conducted to determine which treatments are most effective. thus, parents are left to sort through confusing and often inaccurate information about the various treatment options and claims. clinicians are often at a loss in helping parents to make evidence based treatment decisions.

this gap in research must be addressed. very little research has been conducted that addresses the issues that adults with autism face, despite the fact that adult care accounts for the bulk of the $35 billion that is spent annually on caring for individuals with autism in the united states. unlike other health conditions, we have limited information about autism health care utilization, barriers to access, health care disparities in the u.s., where cost effectiveness models. mr. chairman, over the past two years, your subcommittee and you have been responding to the challenge of autism with resources. this is beginning a meaningful fight against this very challenging disorder. but more is needed to better understand the disorder, diagnosis, and to better treat those individuals who have it. i want to end by thanking you for your time, for your commitment, and for your leadership. i am very happy to entertain any

questions that you may have. >> thank you very much, dr. dawson. before we go on, i want to recognize my good friend and colleague from pennsylvania, with whom i have shared the gavel here over the last almost 20 years. senator specter is a member of the judiciary committee. they are on the floor now with the sotomayor ofoundation. >> thank you for yielding. we are taking up the confirmation hearing of judge sotomayor or for supreme court. i am due on the floor shortly, but i wanted to thank you, mr. chairman, and the ranking member for scheduling this hearing on this very important subject, and thank the witnesses for coming in.

autism is a heartbreaking alemaailment. one of the toughest part is talking to parents who have children suffering from autism, and there's a real question of doing more. we have worked hard on funding for the national institutes of health. for a decade, we are able to raise funding from $12 billion to $30 billion, at a time when senator harkin and i have transferred the gobble -- gavel. regrettably, that is not enough. i know that funding for autism is slightly under $52 million, up to $122 billion now.

cdc funding has increased to little over $22 million. we have been successful in getting it -- getting into the stimulus package $10 billion. it is my projection that some of that will be going to autism. these funding levels were set by nih in order to avoid what we call politicization. our job is to get the money, but not to distribute it. i think there ought to be a bigger share for autism. we are pushing to make that happen. on comprehensive health care reform, which we are working on now, we are trying to get $10 billion added as a base, and start with $40 billion, which

will give us an opportunity to do more. staff will be here to follow the testimony and will have a chance to review it. i appreciate your coming in, and you have are assurances we will do everything we can on this very important malady. >> i understand you have to be on the floor for the nomination. now we will go to mr. cobbs. if i remember right, you are from iowa, of near sioux city. you or the chairman of the iowa autism council, the father of a nine year-old boy, no, with autism. i understand your wife, tina, is with you. >> you have two other children, and you were here at our last hearing a couple of years ago. >> i was in the audience at the last hearing.

>> i am interested in what has happened in the last couple of years, so welcome to the committee, and please proceed. >> thank you for having me. good morning, mr. chairman, and members of this distinguished committee. high and the chairperson of the iowa autism council. i am the parent of a child with autism. i spent over seven years trying to better the lives of individuals and families affected by autism through insurance and education reforms. when i was last in front of this distinguished committee, spoke of the successful and cost- efficient service is my son received. these services were provided in my home in iowa from professionals in florida through the celeste foundations federally sponsored national research project. we are one of 15 families that participated in this demonstration across the nation.

in this model, after a brief phase of on-site, face-to-face training, which is crucial to build up their peake relationship, we were linked by an interactive video system that allow consultation and support directly into our home, when and where we needed. for this model, we receive professional support in teaching our son language, life skills, and overall improving its quality of life. one of the main components of the study was the reduction in our family stressed for empowering us as frontline teachers and therapists. additionally, through training and education in this project, we had a better understanding of our child condition and those things we could do to bring to bear to improve his life. not only did improve my son's quality of life, but it had an impact on my family as well. also as a family, which showed a dramatic reduction in stress, anxiety, and became more focused as a family unit. i will never forget the call from my wife saying it will

never guess what our son did. he went potty on the big boys potty. this becomes a super milestone when your child is five years old and has the additional burden of societal rejection. we are given the right teaching skills and able to achieve what previously was unobtainable. our experience is chronicled and aired during autism awareness month. we have footage that we would like to share with the committee and it can also be viewed online. i cannot stress enough that the needs of a person with autism do not convene with professional hours or appointments.

just having the support in my home and allowed natural interaction for my son and allow the professionals to see the behaviors as they really occurred. as chairperson of the iowa autism counsel, i had the opportunity to speak with many family members and stakeholders within the autism community to learn their needs. from my perspective and my experience, these families are desperately in need of services. today, as parents search online for opprobrious services for their children, they are confronted with an array of and validated technologies and various individuals claiming expertise in treatment. unfortunately, there are no safeguards in place to protect vulnerable parents and children. for example, from anywhere in the world, anyone with a personal computer, a web cam and internet access, can offer internet services termed as advice. under the circumstances, any individual or group can claim qualifications in helping parents and children with autism. not only our families

experiencing the emotional burden of treating the child the disability, but they also had the financial burden of paying for this treatment with no assurance as to the quality of care provided. when individuals or organizations are collecting fees for services and can distance themself into the cloud that is the internet, what can families expect? the reality of standard setting is evident, because without standards, there can be no reimbursements. all the systems are cost- effective, without proper reimbursement model, they still remain unattainable for most parents. they are struggling financially to find care for their chi@@@ @ well defined standards. in the absence of consistent reimbursement policy standards,

families and children are not granted access to proven and effective care. i know that this committee, through report language, has assessed that "best practices and professional criteria standards make recommendations to the committee for reimbursement, which advances and reimburses the foresight in doing so, urging that the momentum to continue." in closing, you might be wondering how my son is doing today. he is 9 years old and my family is still utilizing telehealth such behavior is as expressive language, academic skills, just to name a few. it is important to note that as my son grows, his treatment program continues to grow at a direct -- and address his ever evolving needs. it has been an effective

delivery system for our family. has been so effective that now might 8-year-old daughter has become a mini-therapist, using teaching strategies that we learned in the program with my son. at this point, he continues in the role of student and teacher to us all. indeed, his future is bright. i would like to thank you for your time and the opportunity to share our story and the stories of thousands of families here today. thank you. >> thank you very much. we will have some questions for you later. now we turn to the vice chairman of the mississippi autism task force. an attorney and mother of two children, her second child developed aggressive autism at around 22 months of age. she was recently appointed to mississippi's department of education, special education advisory committee. she attended mississippi state and received her doctorate from

ole miss. >> i want to thank this committee. on behalf of the many families with optimism that i represent. we have had various meetings throughout the state of mississippi. in fall of 2005, our family was living in san antonio, texas, has been completed his fellowship. my of his job, at the age of 22 months developed regressive autism. almost overnight, he digressed from using words and sentences into language with fine and gross motor coordination well above his developmental pierce, to someone who lost almost all of those skills sets. it was as though a tornado had hit our lives, and there was no end in the foreseeable future. at age 25 months, i son began a rigorous program filled with behavioral, speech, and occupational therapy, that has

continued after our move back to mississippi. currently we can see progress, and we are cautiously optimistic about the future. he is quite verbal and his gross and fine motor skills have greatly improved. his medical condition is always tenuous, as he is believed to suffer from mitochondrial disorder which is supposed to be contributed factor to his autism. simple viruses will turn this very high functioning child to love functioning child within just a matter of hours. today, he will attend his kindergarten open house in oxford, mississippi. he will attend a regular education class and have some classroom resource assistance. as a class of 2022 starts kindergarten, schools across the country will look very different. 20 years ago in this country, he would probably have been the only child in his class with autism or even his old school district.

-- his whole school district. his kindergarten class will have six children diagnosed with autism spectrum, all of them very high functioning. if you do the math, that is roughly one in 34. in mississippi, according to surveys, we know that children typically do not get diagnosed much later than 5. that number is probably going to go higher. this is a very high number compared to what we see as national statistics, but i think you can see this number replicated in kindergartens throughout this country in various places. we know that the rate of autism goes up 10%-70% per year. can you imagine what autism is going to look like in the next decade? the medical establishment gives itself a pat on the back for saying they are doing a better job diagnosing this, but we know

there have to be contributing factors that are the root of this increase. better diagnosis does not completely explain the explosion we are seeing here in america. we often see adversarial relationships develop between pediatricians and family members who believe that there autism was caused by vaccines. we also see adversarial relationships when parents do not accept the advice of physicians that there could be multiple causes of autism, and reach an impasse. the autism society of america currently estimates that the lifetime cost of caring for a child with autism is from $3.5 million to $5 million. taking those numbers, we are looking at facing almost $90

billion annual cost in autism. the question we have to ask is, can we afford not to put the money into research and treatment, if these are the numbers we are looking at? i am glad you are sitting beside me. the combating of citizen group brought great hope to parents. --, adding optimism grew. we have to move quicker. we have to see the coordinating committee look at all aspects and possible causes to autism. we also have to see that committee quickly make some identifiers and look at populations of these children's to find out what are the general pictures we see of these children's parents, their family members. what are some health indicators that we see? in has to be done quicker than we usually operate at government

bureaucracy levels. the other thing, i would be remiss in represent the parents across this country if i did not go back to your question. we have to look at the causation with vaccines. dr. healy, who i am sure has testified many times, and does not have any financial interest, has noted that there is a dearth of research in truly looking at the vaccine-odd to some connection. there are some very good steadies' that have yet to be done -- the vaccine-autism connection. i know this committee does not like to tell the nih how to spend those research dollars, but on behalf of parents across america, i ask that you look at this when you are confirming a new nih director. i want to give you some

optimism. in this classroom, five of those children have been blessed to be able to receive intensive behavioral therapy. their families have in one situation taken to jobs to be able to afford this intensive behavioral therapy. that is not often the case in mississippi, and is a rarity. the average annual income in mississippi is less than $35,000 a year, and yet this private therapy runs most of us around $50,000 a year. it is impossible for many of the constituents back home to a for the therapy that they know will make their job better. -- to afford at the therapy. i beg you to look at ways that we can afford intensive behavioral therapy for all children. these children that i mentioned

who have received this therapy, even at the age of 5, they already are requiring less classroom support than they would have. you can see the financial bright spots down the road of investing in early, intensive behavioral therapy. the question i will leave you with is, if we know that we are looking at a $90 billion annual health care cost, and we are looking -- we are looking at initial investments of around $32,000 a year, and we know that over that child's life, we can see health care returns at roughly $2.5 billion of health care savings for their children who get this, the question is, can we afford not to make that investment?

>> a very profound statement. thank you very much. now we will turn to david miller, a resident of fairfax county, virginia. he is on the board of directors at northern virginia community college where he co-founded the consortium on autism and intellectual disabilities. he has a master's in public administration and a law degree from george mason university. he is retired from the armed forces and the father of two identical twins who have autism. >> thank you very much for holding this hearing. as the chairman indicated, i am a board member. we are the second-largest many college in the nation. i and the co-founder of the consortium on autism and intellectual disabilities,

comprised of 41 community college presidents. i am pleased to say that a colleague is a very active member of our consortium as well as the president of hines community college, which he tells me is the largest one in mississippi. both of these leaders could not be here today, because a previously scheduled board meetings, but we do have some community college presidents here that i would like to introduce the subcommittee to. the first one is willing duncan. he is the chairman of taft college and the chairman of our consortium. we also have dr. wayne burton, president of the north shore community college in massachusetts. we have the chairman of passaic county community college.

also with the is jeff ross. if you look at my testimony, the summary of the measurable results that taft has achieved these last 13 years with respect to students with intellectual disabilities and developmental disabilities is astounding. at the committed college level, we aspire to have programs that affected. this hearing has particular poignancy to me because i am the father it of 27-year-old twins who have autism. their sister is the youngest of these, and thankfully -- she is the youngest of these triplets. thankfully she is a healthy, happy, seven year-old.

i am concerned about the long- term viability of these children to live independently and develop a career checked that will allow them to support themselves financially well meeting in overcoming challenges that you and i have never faced in our entire lives. i am not as educated as some of these presidents. i am not as well versed in the nuances of optimism or as well read as my wife, who on a daily basis meets the challenges. she is a wonderful and very accomplished woman. she should be seated in this interest -- in this witness chair. when you do the next hearing, she needs to be invited. people talk about takeaways. i think that when you go on to further activities, the two

takeaways i would like to have for my testimony or, number one, my kids are here to stay. what you are doing with respect to research is excellent. we need to invest funds in screening in diagnosis and all that. we need to do that, but having said that, my kids are here. all the panelists who have autistic kids are here, so what autistic kids are here, so what are we going to do with these what is the game plan here? what are we working towards? what are we working for? most of these kids are below the age of 17. more and more of these kids are entering middle school and high school. what are we going to do with these kids? aphotic -- critical question that we have to consider. at the community college level, we are seeing the first beginnings of autistic kids on our campus. your chairman, by the way, chairman kennedy, obviously gets it.

he has called this a tsunami. he said that we are not investing in the infrastructure to deal with this coming tsunami. the higher education bill, based on the authorization of the secretary of education to work on five-year grants to support model demonstration programs that support the progressive demonstration programs that promote the sec's -- successful transition of students. i have a letter from senator kennedy where he requests funding for these types of programs. the reason for this bunning request is that the vast majority of autistic and disabled students are currently in committee colleges and will attend community colleges because we have open admissions

policies. they reach age 21, and the, on our campuses. they are here, and frankly we have no effective programs to deal with these children. they enroll in normal academic courses and are soon put on academic probation, and then soon academically dismissed, and that is in it. they have no further contacts with respect to job training programs. they have no further or additional educational opportunities. that is it. what happens to these kids after that? that is what senator kennedy is really focused on. some schools will tell you, these are expensive programs. they run roughly $30,000 a school. there are limited by law to approximately $2,000 to $3,000 for tuition. they do not have access to any further funding. with the reduction in state operating funds, they did not

have the financial resources to develop programs to assist the students. i know i am over my time. these funds are are essentially economic development funds. they are essentially local stimulus funds. they will be focused in life skills training and vocational training. we appreciate the fact that you have seen fit to put approximately $80 million for this program, and we hope that in conference, you will walk away with at least that minimum amount of money. again, thank you very much. >> now we have a co-founder of beat iowa. usually we do not say that. [laughter] i should have looked at that before i set it.

-- before i set it. that could be misinterpreted. she lives on a farm in north would, iowa, way up in northwest iowa with her husband and three children. her 7-year-old daughter, robin, was diagnosed with autism when she was 15 months old. she has a b.a. in french from southwest in receipt. >> she was diagnosed a little before age 3. her diagnosis was that three years and three months. >> thank you, mr. chairman and colleagues for this opportunity to encourage more thought and action on autism. and a daily basis, i am a wife and mother of an iowa farm family. i days are filled from very early to bury late with joyce, blessings, and challenges of my

three children. i have one daughter who has heavy-metal toxicity. her original diagnosis and just over age three was of his mental retardation. although my daughter was given the label of autism, this failed -- this term fails to describe the nature of her disorder. after her diagnosis, i discovered by medical origins of our condition. over the next several years, we confirmed multiple medical diagnoses, including intestinal this bias is, multiple few -- food allergies, growth hormone deficiencies, in the crib disfunction, pituitary dysfunction, hypothyroidism, allergic colitis, and heavy metal toxicity, to name a few. we have only been able to help robyn by struggling to travel all over the country and working with many medical practitioners, spending thousands of dollars on tests and clinical visits, mostly not covered by insurance. the list of diagnoses is long

for such a young child. her healthy appearance belies the death of her medical problems. based on her appearance, people expect her to be able to respond to them, speak to them, and share with them. robin has come a long way, but still has difficulties. i know of children who have fully recovered with the properties for their medical conditions. . because these underlying medical

problems exist in and our children and can cause the very symptoms that are labeled autism. i have been involved with multiple meetings for eight years. we have been discussing the cause and treatment issues. because no action has been taken, more action needs taken. families have been destroyed. it will fall not only to the families and parents, but to taxpayers in general as the oldest start aging out of school. professionals in the field likeate robin will cost millions of dollars. i have accepted your invitation i have accepted your invitation because i want to set the reco ismould like to without addressing some other a words. we have the sickest generation of children with one in nine

children suffering from asthma, one in six with some form of narrow development disorder, and a least 150 with some sort of what is and disorder -- autism disorder. agencies charged with protecting the health of our children suffer from serious financial conflicts of interest. these government agencies need to be held accountable. senators, it is difficult for me to sit at this table and tell you that you have been lied to. we have all been lied to. rovin's vacc -- -- robin's vaccines were administered red after her birth. the data sheet identifies the chemical effects as follows.

the mercury component has caused nervous system affects in experimental animals including mild retardation and motor impairment. he did not need to take my word for the scientific facts. the former founding editor of " environmental health perspectives," and former associate director of the toxicology program, considered the world's's largest toxicology research is with me today. the number of vaccines since i was a child has risen from around 10 to 49. those who create vaccines option -- often set the table and vote to approve vaccines, read the dollars, and are immune from legal liability. where else do we see this

scenario of no accountability and conflict of interest? who is on the table on behalf of the children? very few are doing it. we need transparency, honest communication, and once and for all, as you suggested earlier, a valid, unbiased study of the vaccinated verses on vaccinated -- unvaccinated populations. men voluntarily and inject themselves with steroids while thousands of children are injected with a neurotoxin under government mandate. some children are injured by vaccines. their access to legal compensation is barred by many legal obstacles. although i do not have time to describe the necessary reform, please take a look at the on fairly restricted three-year statute of limitations among

other legal problems facing these families. heavy metals like mercury and other toxic substances should not be injected into people, especially babies and young children, and others susceptible to a vaccine injury. vaccine safety certainly encompasses more than concerns -- mercury is so highly toxic, it is the 600 pound gorilla in the living room. it only takes a 0.6 micrograms to harm human tissue. according to scientific studies, it continues to be used in some vaccines including tetanus and flu shots. that is a fact. it is damaging at minimal levels -- nanomolar levels. it has been replicated and ignored. we pretended not to see. those in power do not discern facts. they did not protect the health

of the children of this generation. they protect industry and government. my hope is for action. can we really afford, with continued inaction, to risk losing another generation? thank you for listening and allowing me to share my concerns. as i return to our iowa farm, i will reflect on what we have lost. into the many other mothers and fathers whose hopes and dreams have been crushed with this chronic illness. we will continue to hope for action. our children and our future depend on you. >> thank you very much. i think we have heard the whole gamut of everything here now that we are confronted with. since your first on the left here, i will start with you. you mentioned that no comparative effectiveness have

been done to allow for treatment of autism. this is something we have the focus on. -- we have to focus on. we are in the here and now. families are struggling and facing this whole generation of growing up and what is going to happen to them as adults. this committee provided over $1 billion to hhs in the recent recovery act for comparative effectiveness studies. $1.1 billion to be exact. again, we do not say exactly where to put them. do you know of any of those dollars will be spent on autism? they said it was one of the conditions that should be studied. you have any thoughts on that?

have you been watching or have you been involved with trying to see that some of these comparative effectiveness studies are done on early intervention programs? >> yes, i am aware of the focus by the agency for health care quality on comparative effectiveness. we have submitted recommendations in terms of the kinds of questions we feel need to be asked. i think it is so critical that parents have a sense of whether one thing is effective more than another treatment. the other aspect of comparative effectiveness work has to do with method of service delivery. what we know now is that when children receive care, they often receive it by a set of professionals that work with the child. the parents of himself has act as a case coordinator.

there are other models for how to effectively work with a child with autism. it has a kind of financial aspect that goes to coordinating care. example of a comparative effectiveness study that needs to be done to study to look at different models of service delivery to find out what is ultimately more cost effective. the other question has to do with this issue of personalized maddison. what kinds of treatments work for which kinds of individuals? we know that autism is not going to be a one size fits all approach. we understand the effectiveness of the underlying biological markers, whether we are looking at medical conditions, as a parent talk about, or metabolic

conditions and so forth and how these can direct treatment approaches. we are in the very early stage in understanding the question of which treatments work best for each individual. until we do that, parents will be seeking out answers themselves on the internet, acting on non-evidence based decisions. >> mr. cobb's, all of you here,i got interested in using telehealth some time ago because i come from a rural state. we do not have the access to the facilities that people in urban areas do. finding them in outlying areas, i became more the issue of autism a few years ago.

families with young children are at their wits' end. they do not know what to do. there are some residential programs for traditional things you're talking about. correct me if i'm wrong, and i think there is evidence that the earlier you get to these kids and provide them with supportive services, interventions by trained people that know what they're doing, that they really do get over a lot of these things. they get over a lot of the problems -- the earlier you get to them, the more effective it is. how you do -- how you get to them if you're living in at no. what, oxford, or someplace like that?

this project of looking at telehealth, and you can get together with a group of professionals early on with high-speed internet, it is like your in the doctor's office, it is like you are right there. tell me a little bit about -- you have been in this experimental program to go since last time we have continued services to continue the study and test the longevity. >> have you talked with other people? you're the head of the iowa autism council. i do not know how many people are on this system right now. have you talked to them about this? what interest is there? >> that is a great question. in fact, just this morning, we were talking.

it is the light bulb that goes on. the mean i can get services where and when i need them? for instance, if he is having a great behavior day, we can replicate that. we can build on that with the foundation of applied behavior analysis and other proven methodologies. if he is having a bad day, it is not because we are in an abstract physician's office, it is because there is something that has triggered that behavior. it is that immediate response to track down what is causing behavior. we can get immediate results when the behavior is happening, both good and bad. >> the other thing that got me thinking about this is at other times, kids with autism do not act up when they are in a doctor's office, and when you get home, they do. >> in our case, it might be the

exact opposite. the environment may have to much stimulus in the area. you will get the reverse effect. maybe we went in for any rate, but all of a sudden we have a behavior taking place. and we may have believed that environment without properly giving them the care -- we may have to leave the environment without properly giving them the care. to dovetail on what ms. dawson said, it is also a great way to bring a comprehensive team together to treat the child in a natural environment. >> have we been doing anything to show comparative effectiveness? is this something that the million dollars will start taking a look at? does anybody know that? have we looked at these early intervention, telehealth type

programs? >> not with respect to the teller health -- telehealth study i am aware of. >> the recovery act has given us this opportunity to open up the doors for additional work. we do have exciting proposals on just this topic for autism specifically. i think this is the chance to see real progress in this arena. it is not only for the child, it is for the family. that is where some of the big implications will be. >> i am assuming you are not on this telehealth? >> we have really hit all aspects. we found out to the medical side

first and found out about aba, and used both. i feel both have been essential in robin's progress. i know a lot of other families agree with me that at least exploring if your child does have these biomedical issues, you're going to get better results when you're using the aba. >> how would you feel as a parent if you had access in your own home, 24/7, so that anything that happens in terms of behavioral problems, you would have ready access to train specialists. -- trained specialists? >> behavior's became not nearly as much as an issue. for me, the medical care that she needs i can only obtain at our doctors' offices.

if i am taking her in as an example, monthly right now, she has been undergoing a six hour infusion therapy in our doctor's office. that has to be done for us. it is a drive no matter what. >> i have taken 10 minutes of time, so i will yield. >> your very kind. i appreciate you calling the hearing. it brings back memories of other hearings we have had. we will just try to tailor programs of support that are needed that will help make positive contributions. i am wondering, is there something that any of you have in mind to suggest -- and financial support and willingness for government to

try to figure out ways to be more supportive, benefits of some kind? insurance programs that maybe the government can help support in terms of costs of premiums or disbursements for sharing responsibility? it seems to me that we have a lot of organic medical disabilities and frailties that come within the area of insurance that this challenge is just not being helped with. i wonder if you have any thoughts. >> i would like to comment on this notion of early intervention and actually tell you about the steady that the doctor was referring to. this was the study that i was the principal investigator of this study, funded study where children began the intervention

below 30 months of age. it is the first clinical trial that has been conducted with toddlers who are at risk for autism. it is the standard care in the community or intervention that focused not only on working directly with the child, but also taught the family how to use intervention strategy so that intervention occurred throughout the daily activities with the child. the intervention went over a two-year. -- a two-year period. all assessments were done blind with respect to the knowledge of whether or not the child received early intervention. they all had iq's in the mentally retarded range. their iq -- the increased iq --

the average iq increased. their diagnosis was less severe. it was a less severe diagnosis, and remember, it was only two years. early intervention could continue for at least another one or two years. we know these are effective. the studies are impressive and will come out soon. what we don't have is two things that limit access. one is financial support for families. it is going to save us money. it is going to help families. it is going to help individuals take advantage of some of the programs we have heard about at the community colleges and so forth.

the second piece is training for professionals and parents. we're working now with infants and toddlers. they're teaching parents to deliver the interventions. in many of these interventions, we need programs such as telemedicine or web =based -- web-based programs around the world like africa and india, to train professionals. comprehensive coverage and professionals is going to be absolutely key. we will get kids on the right trajectory, and we will look step-by-step throughout the life span how we can continue to support people with autism to become the most productive citizens they can. >> is a very interesting and

helpful analysis of some of the options we should seriously consider. you were seeking recognition, and i wanted to call on the next. >> the task force looked at this in mississippi extensively because of our financial system -- financial situation. it is already a program that is out there federally. it needs to now include behavioral services, because many of these children are starting to be identified very early. i can speak to the success of that. as we were in san antonio this summer, i met a precious child named catalina. they began behavioral therapy after a year. the child is 4 years old now and is absolutely amazing. senators, u.s. never recognized that she was a child on the spectrum.

-- senators, you would never recognize that she was a child on the spectrum. states have an option whether they can give a not as an specific waiver -- and on to some -- an autism specific waiver. i ask that you not give that waiver. the other thing that dr. dawson mentioned is private insurance. there are virtually no policies in our states that cover autism therapies. in fact, not only does it not be covered behavioral therapy, but senators, it only covers 20 visits of any type of speech ot or pt. usually you have run through your insurance coverage for your child. because that is combined speech

and ot. you can see why many of these children are not getting the assistance that they need. those are the things that we looked at as gaps that needed to be filled in the state and federal system. >> we need to introduce a bill that will modernize medicaid reimbursement. how do people afford to do this? >> they cannot. >> frankly, they cannot. i do not have the exact figures, but i know that we have been working hard to get the mandated insurance coverage in virginia. it is a fox hole by foxhole fight. . is about $40,000 or $50,000. the average cost of service is about $85,000. the families have to do without.

it is being done on a state-by- state basis. if you could do some sort of insurance preemption, that would be ideal. this is an educational issue, not a health issue. if you see my sons, it is clearly a combination of education, and health related problems. >> another thing that i would be remiss if i didn't quickly tell you is the financial stress that it relates to families -- the divorce rates. conservative estimates is that a minimum of around 80%. there are some estimates -- her divorce rates were among 90%. these are absolutely incredible numbers. we lost to parents in

mississippi this year who could no longer handle the stress of having the child on the spectrum. that is not unique to mississippi. those are things that we foresee all around the country. >> i would like to go ahead and piggyback off that statement. the government needs to move rapidly to go ahead and advance a great technologies such as telehealth technologies and insurance policies. in order to make a true change, we have the have the standards and reimbursement model for applied behavior analysis and other proven therapies as miss dawson said. the private insurance companies typically did not reimburse that

for families with autism. >> i wanted to say that we do have a unique opportunity with health care reform to address this issue. the house bill does include coverage for behavioral intervention for autism as well as ava. i think it is critical that with this opportunity, what we're looking at in terms of health care reform, we need to include this. in terms of the financial payoff down the road, it is going to be tremendous. it will help with the tsunami, and the impact on families will be tremendous. we must not miss the opportunity for federal mandate of insurance coverage for treatments that are cost-effective and that work. >> [inaudible]

>> we're going to introduce something together. we will find out the details a little later. >> from the iacc perspective, we have a service group made up of family members as well as somebody from cms who has been leading the charge -- the president of the autism society of america. they have been listening to families about these issues and trying to come up with recommendations. i am sure that group would love to have an audience and get some ideas that they have been grappling with. >> you just wrote about standards. someone mentioned that you get

all kinds of misinformation. you have been on this telehealth for three years now. when you mention standards, is that what you're talking about? >> absolutely. when we start our treatment program, it is a comprehensive treatment program. unfortunately, families can pop up in the internet search and tiepin -- type in telehealth treatment. i do not see how it is possible to form a true therapeutic bond and go ahead and treat the child. is very disconcerting. you can quarry pretty much anything with autism and related disorders.

whether it is some way to repair your car, somebody who can paint your house, it is so sporadic. parents do not have a consistent place to ensure that they're going to receive quality care. i am encouraged that you have folks meeting and talking about new treatments. until we get a set of parameters for standards so that when parents go to get treatment, especially over at innovative technologies like telehealth, they have the assurance that they will get a trained, quality professional. and they're actually standards that they can rely on. right now, those aren't there. >> i just wanted to mention a program that is a wonderful example of a public-private partnership that is beginning to address this issue of standards.

that is the odd to some treatment network. -- autism treatment network. cystic private -- to cystic fibrosis was in the same boat, not getting quality care with no standards on how a child should be treated. it is 15 hospitals that care for children with autism that have come together both to look at quality of care, models of care as well as develop standards that can be practiced standards, published in journals that physicians can use to guide things like assessments, behavioral interventions, and so forth. there is a mechanism where this is beginning to be addressed. it is indeed very early stages. it is co-founded by of autism's speaks -- autism speaks.

>> who does this? who is charged with responsibility for coming up with standards that have to be met so we don't have people out there that don't know what they're doing trying to treat people? >> you have stumbled onto a really important issue. it is not unique to autism. we have built standards that are overseen by the fda. in the broader psychosocial intervention arena, there is not an agency or a licensing body that oversees this in quite the same way. it is a gap as we look at this. even in this healthcare reform consists -- discussion, when you talk about treatments that may not be a one of the 15 hospitals but involves training

families to administer care 10 or 15 hours a week, how does that get reimbursed? how do we set standards for the degree of care and level of care that is needed to be reimbursed? >> did you ask me that, or as a rhetorical? [laughter] -- is that rhetorical? >> i am a psychiatrist. [laughter] >> how do i feel, doctor? [laughter] >> that's true. again, obviously we have a whole range of interests here. everything from the research into the causes -- obviously,

there is a lot of talk about vaccines. you covered that in your testimony. we had a couple of questions about the number of vaccines and how we set up that kind of a steady -- a study. ms. halverson talked about the kind of a steady. -- study. if you wanted to determine that, i did not know how you would do that. >> one of the reasons i wanted to bring that up, senator, is that there are some many families right now -- and this greatly concerns me. i believe in vaccines, i think they're one of the greatest public health achievements that we have ever had.

i am a huge proponent of it. what i am concerned about -- there are so many families that are not vaccinating their children. and we do vaccinate our children. there are some many that are not vaccinating because of what they perceive as a huge risk. i am concerned that the nih and the cdc, with their failure to look at this and give good, valid, scientific studies free of people that might have some interesting in this, that they are doing more harm to lower the immunization rates than anybody that is yelling out there to be concerned about vaccines. there are so many people right now that are choosing not to vaccinate their children. i do not think that population

is going to be as difficult as scientists perceive that it is. within the autism community, we see that going on right now. many of us feel that vaccines are very important. we hear families, to us and say, we are not going to vaccinate our kids. having a husband as a medical professional, i worked as an attorney in public health. that greatly concerns me. they do not have any of the possible health characteristics that some of us who did have children with vaccine reactions have that could have been red flags. now that we know that, it could have been studied. the scientific community can find these people to do this. >> go ahead.

ms. halverson. punch the button. >> i was going to mention, i do not know how many people would be needed to be included in a steady -- in a study, but in the chicago area, there is a practice of about 35,000 patients. many of them choose not to vaccinate, and their optimism rate is next to nothing. there are populations -- and there autism rate is next to nothing. the homage people can argue on that. -- the amish people can argue that. it is people from every walk of life. >> i do not know about that. >> let me be very clear on this point.

i am representing what we know about the scientific evidence so far. that is really an unequivocal. it is not that cdc and nih and multiple studies have not looked at this, this problem has been looked at over and over again. 16 large-scale studies that have plowed into this question that many different levels and many different populations. whether you read those studies or institute -- >> you mean the total number -- >> the possibility of a connection with particular formulations or without. and the prevalence of autism. whether this is a risk factor. studies have found no risk of a connection. we have heard that from the institute of medicine. we have heard it from the --

>> when i mentioned getting a study done of the number of vaccines in the first two years of life, compared to 20 or 30 years ago, would be the incidence of optimism -- autism that received 29 vaccines compared to a cohort of kids that got five or six or seven or eight, what they did in 1980 compared to 1929. i do not know any studies. >> are you asking the question, as the prevalence of what is an increase over the time when the number of vaccines of increase, is there a relationship? we know they have both gone up.

>> but what we don't know is, is there any causal relationship between the number of vaccines that are given -- is 29 over two years now. in 1980, it was 8. is there any causal relationship between the number of vaccines, 29 in two years, and higher incidence of autism. we don't know that. >> the way to do such a study clearly would be asking -- we would have to do randomized control. we would want to look very carefully at those who are vaccinated and those who are unvaccinated or vaccinated in a different way. that is when we get into ethical

problems. >> she just mentioned somewhere in chicago -- i do not know where this is, but they do not vaccinate. are there places like that? and you mentioned people that there are -- you mentioned that their people not vaccinating their kids. >> the question one would ask is not only about does this have an impact on autism, but what is the impact on other diseases, a whole series of preventable illnesses for which we know the cause diarrhea we know the vaccines can prevent them. -- for which we know the cause of, and we know the vaccines can prevent them. is there a potential relationship here?

>> senators, this is where there are many people in the medical community -- and i mentioned the doctor that feels like this issue has not been appropriately evaluated, particularly also looking at sub populations to look at whether -- their mitochondrial issues involved with that. i think it is imperative that we look at those particular studies. i and the stand the ethical thing about asking parents to do this. senators, we already have populations of families that are not doing this anyway. absolutely, we should look at whether their children developed

measles. quite frankly, senator, measles and autism? >> if you had a choice? i had all those diseases when i was a kid. we had imams, measles, chicken pox, everything like that. >> is important to recognize that many of us were exposed to those illnesses and did quite well. they are also fatal. i grew up as a physician watching children died with meningitis -- children die with meningitis because we were not preventing those diseases at that point in time. i can tell you, to think that we have been able to finally succeed in that sphere, and to go backwards --- we are better

than that. the science tells us we are better than that. >> i know we're better off in that regard. i would like to see it -- i have had a lot of hearings and talked to a lot of professionals about whether or not we need all of those vaccinations in the first two years of life, or should they be stretched out longer. it is an open question. i do not know the answer. >> i have to point out also, vaccines do not always work overtime. my son is a walking example of that. the chicken pox vaccine was brand-new when he was 2 years old. the doctors said i should get it for him. i had chickenpox, itas not a big problem, but i missed a couple of weeks of school. six months later, after being

immunized, he developed a full- blown case anyway. that was my first clue that i was not necessarily going to choose immunizing my daughters for chickenpox, my future children at the time. i was pregnant at the time that my son developed chicken pox six months after his vaccine. had i not had it as a child and had a lifelong immunity, my baby could have been at risk for birth defects as i understand it. there is mor to consider than just a blanket statement of the vaccine is automatically going to protect. it does not always work that way. >> miss dawson. >> in many ways, i agree with the doctor that we have answered some questions definitively. it does not appear that thimeracol accounts for this

large increase in the prevalence of autism. i do think that there are important questions that still remain to be addressed that have not been addressed by the large epidemiology studies that have been conducted so far. in particular, i think it is important to understand the role of underlying genetic in the medical susceptibilities and whether they may lead to an adverse response to an exit -- to a single vaccine or a set of vaccines that are given over a short period of time. the era of personalized medicine is beginning to and used our practice of treating infectious disease. the underlying variation in genetics has not been studied in the context of responses to

vaccinations. autism's speaks -- autism speaks looks at mitochondrial disorder, responses to vaccines, developing seizure disorders, and whether these may count for, again, some minority of cases of autism. another thing i might suggest is, i agree with the doctor that randomized study in which we ask parents to forgo getting vaccines is not ethical and not feasible. we could, however, study the potential role of vaccines in the context of two ongoing nih studies.

one is a study that we are finding, following a cohort of that risk infants. infants who have an older sibling with autism who have a higher chance of developing its. -- developing it. some parents are choosing to vaccinate, and some parents are choosing not to vaccinate. we must leverage those studies to see the effect that outcome. the other study is the national institute of health's national children study. this is 100,000 children that are being followed from conception through adulthood. keep in mind that 600 individuals will develop and autism disorder -- an autism disorder. we oversee the expert advisory

panel that is advising the national children's study on how to leverage this study. one of the weaknesses in the current design is that they are not collecting medical records. they are not collecting information that would inform how parents are vaccinating their children. again, with many parents choosing not to vaccinate their children, this is another opportunity with the collection of medical records that we could leverage an ongoing study to address this important question. and i want to say that our position is one of very evidence based -- we are very agnostic with respect to whether the vaccines play a role or not. by addressing parent's questions -- we think is going

to be critically important for public health. >> i have been a big supporter of that children's study. i have used my position to make sure that we continue the funding for it and keep it going. i think it is one of the most vital longitudinal studies we have ever done. you're telling me that of all the money we have put into that , this is a 20-year -- how many years is this? are they not keeping medical records? >> they do not have the funding to go back, obtain the medical records, and extract the information we need. it also affects our ability to

address really critically scientifically based questions like, what is the effective of a flu infectin during -- infection during pregnancy. these are all obtained through a questionnaire rather than medical records. our advice to the national children's study is that this is a key component. the reason for not doing it is strictly financial. they just don't have the funds to do it. >> i want to make sure that you do not go away with the idea that they do not have medical records. they are not able to obtain the original records with the current budget. they have looked at the possibility of getting supplementary funding that would allow them to obtain the raw records from the physician of referral. that has not been done. dr. dawson is right about that.

i know we're running out of time, but i just think it should be set by somebody here that there will be a time in the future where we will have a much better understanding of the environmental causes of autism. one concern that people have is that if we get stuck looking at one thing over and over again, we will miss the opportunity to look at another cause. we agree that the evidence now is very clear -- it does not explain very much about what we knowbout autism. we may be able to eliminate a rare event that is in place here that would connect the two. all the evidence says this is not the main story. the question for us is, where is the main story? where should we be looking? i would hope that the focus on this topic, particularly in this conversation today does not

obscure the fact that there is probably something out there that is truly important that we need to be focusing on very quickly and move into very quickly. the hope is that the kinds of studies that dr. dawson suggests that are agnostic also include some postnatal factors and we will begin to see a pattern emerge. so far, we do not have that. >> we're going to explore that for the idea -- i wrote that down. i will have to find out about that. again, i know we're out of time. we have three things -- let me see if i can capitalize this. the research and needs to be ongoing -- the research needs to be ongoing with what is causing this. then there is the other elements of interventions and helping

families right now. we know families in the next several years are still going to be having kids with autism. we have to think about what we do about early interventions and how we structure that better. the next thing is, we have a whole group of people out there that are going to be adults pretty soon with autism. how do you work with transition programs for independent living and things like that. it is a big task, but one that we can't shirk from trying to address in multiple ways. that is what this committee is going to try to do. i have picked up some good ideas this morning. is good to be refreshed of the information. i wish i had a simple answer. the you have anything dad?

-- do you have anything to add? >> thank you for interest. >> thank you for your leadership. >> i would just encourage you will to continue to talk with more of our independent researchers. i really take issue with dr. insel's statement. all of the evidence says this is not a connection -- it does say that thimeracol is very much a concern. i would encourage you to talk with other doctors, i could name a whole bunch of scientists that you would clean all lot of really great information from. >> i believe in open inquiry. i do not believe in closed mines, closed doors, or open inquiry -- or closed inquiry. i want open inquiry.

the vast majority of the scientific community, after looking at this, says there is no correlation, we have to move on to something else. again, i am always for open inquiry. any other last things before we go? >> chairman hock -- cochran, thank you for telling -- think you for letting us tell the story of the amazing technology that has helped our family. >> kids that just been diagnosed, they can't go to one office every day. you are an example of what happens when you have someone, when the child is acting up, a professional with the standards can come in and say, here is what you should do. >> exactly. >> the problem is, you do not

get reimbursed. >> you hit the nail on the head, sir. >> if you went to a hospital, there might be some reimbursement for that. >> somewhat. as the others pointed out, there is a complete public and private insurance breakdown. >> hopefully, we will look at that issue of reimbursement. i almost put that in preventative -- that prevented category of services. again, thank you all very much. to me, it has been very informative. we will continue our involvement in this issue. it bedevils us all on getting a good handle on it. thank you for the interagency task force. thank all of you here. believe me, we will continue to

pursue open inquiry and if there are questions out there, let's have some answers. thank you all very much. calle[cap [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2009] >> stay tuned to c-span for continuing coverage of the

economic summit. today on c-span's newsmakers -- lamar alexander on health care, the economy, and his party's legislative priorities when congress returns, as well as recent protests at congressional town hall meetings across the country. >> the democrats are raising the issue and calling protestors names. i think everyone needs to settle down. good hearnes is -- are a good thing. first amendment rights are important but if you shout someone down you're destroying that person's first amendment rights too, and town hall meetings are a very important part of the american fabric but we shouldn't be calling these protestors names. they're scared. they're worried, their terrified. they saw congress try to ram

through a bill they knew they didn't like and they want to find out more about it and let their senator or congressman know how they feel about it. i think good hearnes are important. other than that, we have the right to say how we feel and most of us in public life are used to vigorous exchanges back and forth. >> newsmakers today at 6:00 p.m. eastern on c-span. >> how is c-span funded? >> by donations. >> federal funds are grant funds? >> maybe through private contributions. >> honestly, i don't know. >> i would say through commercials. >> advertise? >> something from the government? >> 30 years ago america's cable companies created c-span as a public service. a private initiative. no government mandate, no government money. >> now a hearing on the

financial state of the u.s. postal service. they announced a fourth quarter loss of $2.4 billion and exmentsdz to lose more than $7 billion by the end of the fiscal year. this portion of the hearing is two hours 10, minutes. >> good morning, hour hearing will come to orlando. our thanks to our witnesses and to our guests for joining us today. this is the latest in a series of hearings over the past half subcommittee and this committee has held on the post office's struggle to adapt to a changing mail and communications industry and now to a deeply troubled economy. the economic crisis our country is battling has had an impact on

just about every family and business. this downturn has impacted the postal service and some of its biggest customers far more than most. financial dalta released yesterday bears there out. those data also tell me that the title of this hearing is accurate. our postal service is indeed in crisis. mail volume was down last quarter more than 14% when compared to the third quarter of last year, leading to a loss of $2.4 billion, an amount that nearly equals the total losses of the postal service for all last year. that brings the year to date loss to $4.7 billion. current projections point to a loss of more than $7 billion by the end of this year. and this takes into account some

$6 billion in savings that the postal service is expected to achieve by next month. these numbers are indeed sobering. some would say alarming. but i should point out that our post master general has said that the mail will continue to be delivered and postal employees will continue to be paid. i would also add that the path out of this situation we find ourselves in is, in my estimation, clear. it is imperative that the postal service next month be given some measure of financial relief. not a bailout, not lip service, not berating. instead a pursuant measure of fiscal leave -- relief and programs a little bit of tough love. the post master general's assurances that the mail will continue we'll be discussing today. having said that absent some

action from congress and the president in the very near term, however, we cannot promise that that will always be the case in. recent months. a number of us have concluded that the most appropriate way to give the postal service a measure of relief is to restructure the aggressive retiring health schedule that was imposed on it in 2006. that has the postal service paying enormous payments of more than $5 billion per year to prefund its future health obligations to its retire yeefments this is on top of $2 billion or more for current employee premiums. senator lieberman and i have introduced legislation, s-1507, the postal service retiring health reform act to restructure

the retiree health payment schedule to give it the financial breathing room to get it through the next several years. it works much like a renegotiation would for a family in which someone has lost a job and needs to find a way to support their family. take as an example, a young couple, get married. have jobs. buy a hofmente they have a choice to a mortgage, 10, 15, 25, 30 years. basic hey they go with a 10-year mortgage. life goes on, kids come along, somebody lowses a job, economy is tough and they go back and say we'd like to restructure that mortgage. we can't meet the payments on a 10-year mortgage. that's too aggressive and we'd like to have a 20 or 25 or 30-year mortgage. not a 50, not a 100, but something more reasonable than a

10 in the current economic condition. our bill is similar so it. the must be passed and signed into law before the current fiscal year nenleds september. that said, our bill is not a silver bullet and does not solve all the problems. it sets the stage for what needs to be done to streamline further and bring back some of the lost business. much of our cost cutting since january has focused on the postal office's proposal to move from a six-day to five-day delivery. making this change would save in upwards of $3 billion per year or more. and based on recent polling a clear majority of the american people would not apose the elimination of saturday service. congress introduced language that gave the postal service the authority to make the business decision to reduce frequency

delivery if it felt like it needed to do. so but every year since then, congress has decided to prevent the postal service from exercising that new authority. and with the situation that the postal service is facing now, i believe it's time for us to reevaluate this pricks. congress also needs to reevaluate the position on facility closures. the postal service currently maintenance that 35,000 retail outlets and more than 400 processing plants around the country -- it maintains that many. this network was.comed for a time before email, before electronic bill pay and any number of electronics rev leagues in our society. we don't need all these facilities but all too often we in congress put up roadblocks whenever someone in congress even mentions it might be time to close some facilities.

we cannot afford to do that either. the postal service needs to find new ways to make its products and services more relevant and to increase demand for them. we gave the postal service new flexibility in 2006, our postal reform law. they've been able to take advantage of that in some instances. one example is the flat-rate box promotion. i think that's been successful and very well received. there's a great partnership between the postal service and u.p.s. and fedex where the postal service delivers the last mile or last five miles. i understand you share the aircraft and there are a variety of things you're going to -- doing to be more entrepreneurial. the so-called summer sale is hoped to bring back bigs in the coming weeks. but i'm also certain that more

can be done in infuseing a new entrepreneurial service at the postal service and we're going to explore that today. finally, i would be remisif i didn't mention labor costs. all four postal service labor contracts are set to expire in 2010 and 2011. it is my home these unions will continue to work scuctive through these negotiations to adjust pay and benefits to reflect the reality that the postal service is facing. in con clues, let me say that there are many services our federal government provides to the people of this country. few of them are appreciated as much as the work of the postal service. i've seen approval ratings of a lot of us who serve on the senate. i've seen customer service ratings for the postal service that most of the american people hold. the postal service numbers are

better than most of ours and we applaud the years of efforts that much led to that and we want to make sure that that level of service and satisfaction is continued to be held by the american people, the customers of the postal service and the folks who work will -- there will continue to be proud of their work. let me turn to senator mccain. >> thank you, chairman and thank you for that expensive statement. i want to thank and you senator collins for the very hard work that you and others have done on this over the years. in twrix 2006 i believe the legislation was passed overwhelming if not by voice vote and we had addressed the problem. three years later here we are with a bigger problem. so we didn't address the problem in 2006 and accordingly -- obviously as we all know this morning, the post office loses

$2.4 billion in one quarter and i read your statement, mr. potter. i see no specific proposals you have accept perhaps that maybe we could close some post offices. in other words, potter would not commit so an exact number of post office closures but said some urban facilities were likely to consolidate while others will vacant specific locations. mr. potter, it's about time we got some specific -- absolute specific proposals to get the post office back onto at least a zero loss basis. now, we've had lots of hearings, we've pass is legislation. so far this year i guess the estimate is a $7 billion loss. we can't do that to the

taxpayers of america. we have every right to expect some specific recommendations both from mr. potter and the administration so that we can enact them into law and obviously a lot of this is due to the fact that america has changed. just as we went from horses and bugies to automobiles, we have gone from hand-delivered mail to the internet and text messaging and emails and twitter and all of the other new means of communications. post office has got to adjust to it or they will go the way of the horse and buggy and the bideles. and so far we have not seen either from the administration or from you, mr. potter, who i understand are well-compensated for your work -- a specific concrete proposal to bring the situation under control. the 2006 bill was advertised as solving the post office's

problems. it didn't. and also, mr. chairman, i'd recommend in the future maybe we have some consumer advocates come and testify before this committee as to their ideas to solve this problem because clearly we're not getting them from the administration. >> thanks very much. let me turn to our chairman, senator lieberman. thank you for being an original co-sponsor of our legislation. >> thanks senator. i want to thank you and senator collins for the extraordinary work you've done over the last several years at the request of the full committee. normally i don't come to the subcommittee meetings but i think we're at such a moment of crisis that i felt it was my responsibility to be here, first to thank you for what you've done. the postal reform act of 2006 represented quite a remarkable accomplishment in terms of the variety of different stakeholders that were brought together and i think it was a constructive and progressive

piece of legislation, but as we know now, the problems confronting the postal service of the united states went beyond what the postal reform act of 2006 could do. in one way that we were already well-familiar with at that time, which was the extraordinary revolution that has occurred in communication in our time as a result of digital technology and electronic mail. email. it's just a new reality of our life. the second painful reality that we didn't foresee at that time, of course was the great recession that we have gone through in the last couple of years. in my own view, the postal service -- it's workers, its employees have made some very great efforts to try to put the boat back on an even keel and i

cite these numbers again. usps has reduced costs by more than $6.1 billion this year by reducing 87 million work hours, realigning carrier routes, freesing postal office and executive salaries at 2008 levels. reducing travel budgets and the like. also trying to reduce the cost of more than 500 existing contracts that will result in short and long-term savings but the obvious reality is, not withstanding all those efforts, is most graphically demonstrated by the quarterly report yesterday, loss of $2.4 billion. the postal service is in a dizzying downward spiral and unless we act forcefully this great american institution, created in our cons tuition --

that's how serious the founders of our country believed the responsibility was to provide for -- as they said, post offices and post roads -- created from our constitution. unless we apply some tough medicine here and we do it working together, this dizzying downward spiral for the u.s. postal service could become a death spiral and none of us obviously want that to happen. last week this commit -- committee voted to report out s-1507 which i was proud to co-sponsor with senator carper. i think it's a good first response to the current crisis. i think without it the post office effectively doesn't have enough money to pay its bills as of october 1 of this year. the postal service has made clear that they'll continue to deliver the mail and pay salaries but there's a lot else

it's not going to be able to do. to me -- one might change what we propose this way or that way but i think it's critically necessary to do this rescheduling of payments into the retiree health benefits fund, payments that are now being done at a level way below any other government program of its kind and most other private sector program of its kind as well. the reality is, though, that that's not going to be enough. that's a short-term step to enable the postal service essentially to keep going after october 1. we've got to agree on a brooder stage -- strategy that will save the postal service because it's not going to stay alive if we continue to do business as we have been. not withstanding what's been happening.

and when i say, that i speak not just to the postal service -- it's -- its workers and management -- i speak of us here in congress. because none of the measures that we've talked about is going to be enough to make this work. all of us have to think about doing things that we never would have thought about for the postal service. i know in the s-1507 an amendment was introduced by one of our colleagues in committee that requires the binding arbitrator in a labor management dispute to consider the financial condition of the postal service. i know that our friends in the unions who represent workers for the postal service are very upset about this. frankly i didn't see how i could justify voting against that amendment. it is per administrative, not mandatory and -- per missive, not mandatory and it is a statement of reality. that same reality has to now be

adopted by those of us who are privileged to serve and have responsibility here in congress. that's why i know that there were discussions of consolidating more branch offices over the postal service, of going to five day a week mail delivery. these are owner use responses. we would never have considered them at an earlier time but i don't see how we can keep this venerable american institution, which so much of america and american congress still depend on, going without taking steps exactly like that. our constituents are not going to be leap, but every time they express their unhappiness to us, i think we have to say, if we don't take some of these tough moves, what it means is that we're going to either have to raise your taxes to make greater payments to the postal service from the u.s. treasury or we're going to have to put it on the

government credit card, which is an act of irresponsibility, because we're turning the burden of repayment over to our children and grandchildren and those who follow. those are the choices we're going to have to make. i remember some years ago there was a little post office in connecticut that the postal service wanted to stop. people were furious. they loved that little post office. it wasn't very busy but they loved it. all of our congressional delegation went to bat. the post office was kept open but those were different times and we simply cannot do that anymore. this great postal service of ours is an iconic american institution that has always delivered for the american people. now it's time for the management, workers, and congress to deliver for the postal as much as. if we don't apply the kinds of tough measures -- call it tough love, if you want -- this

institution which we depend on is simply not going to be there. thank you, mr. foreman. >> thank you very much and for your strong support of this legislation. no one has worked harder than senator deloins enact the postal reform of 2006. thank you for your work then and now on these issues. >> thank you, mr. chairman. first, let me depend this -- the chairman for holding this important meeting this morning and i appreciate the opportunity to join you. i must say, however, that it is most disappointing to once again be discussing the dire financial condition of the u.s. postal service. just two and a half years ago, congress passed crucial reforms that senator carper and i authored that rescued the postal service from the g.a.o.'s high risk list. today the postal service is once

again in a financial crisis and once again it has landed on the high risk list. in 2008, the agency lost $2.8 billion, and this year, as my colleagues have indicated, it is projected to have a net loss of a staggering $7 billion. the postal service matters to our economy. it is the linchpin of a $900 billion mailing industry that employees nine million americans. so what we're talking about affects far more than the employees who are working in the local post office or distribution centers. it affects nine million americans working in fields as diverse as paper manufacturing, printing, publishing, direct mail and financial services.

and indicative of that is one of our witnesses today. it is the chairman of new page, which is a paper company that has a large plant in rumford, maine. new page is representing many other businesses, nonprofits and organizations whose operations are linked to the postal service. if the postal service, for example, were to resort to excessive rate hikes or decrease delivery service, it has ramifications for all of these companies. may -- they may have to respond with layoffs, increased prices to consumers or reduce services. any of these adjustments would contribute to an even more perilous condition for the postal service. why?

because when businesses cut their costs they reduce mailing costs. and that leads to a further erosion of the postal service's shrinking mail volume, which in turn will prompt more proposals for rate increases and renewed calls for truncated delivery services. as senator lieberman has indicated. this is a vicious cycle. . this is a vicious cycle that has no good outcome. we must prevent downward spiral. we must put our shoulders to the will and accomplished the difficult task of transforming the postal service. the postmaster general has offered three major proposals for congress to consider. first is adjusting the payments to the retiree health benefits fund. i support a judgment in this

area, the bill approved by this committee would have an increase in the unfunded liability of $4 billion. i think that is a problem. second, the postmaster general has proposed to eliminate six- day week mail delivery. and he has proposed closing or and he has proposed closing or consolidating post office facilities. the post office is reviewing a 677 of as 3200 stations and embraced -- branches nationwide foreclosure or consolidation. this proposal along with other plans would give reduced services to customers. is that really the right response to this crisis? the question is will it make a real difference in the cost

structure of the postal service back if it will, we should consider those moves. when you look at where the costs are in the postal service, it raises a lot of questions in my mind. the postal service can also not expect to gain more business which is desperately needed if it is reducing services. the proposal for closing or consolidating the branches -- the non personnel costs of these facilities account for about six tenths of 1% of overall postal service operating costs. if the postal service were to close all the branches and stations on the list -- let us

say they close every one of them, it would reduce the operating costs when you include personnel by less than 1%. so we need to look at whether that is worth it. or whether there are better more effective means of reducing costs. last week before this committee , they're looking for relief. our committee adopted several amendments to address some of the cost structures and made the bill more fiscally responsible. additional changes need to be made on the senate deplore. there is no question that we do have to act. we must rescue an institution

dating to the early days -- the earliest days of our nation. we cannot allow the postal service to fail because it is too fundamental to our economy. it is going to take an honest assessment of where the costs are. it will take everyone working together, management, employees, members of the mailing community, this congress, and the administration to contribute to the solution. we must work together to find a real, lasting and fiscally responsible solution. thank you. >> thank you for your hard work on this floor. our bill increases the and the

unreliability fight -- by $4 billion. . we would have less money and less interest -- it is a drawback. i want to note that for the record. we will not recognize you for your statement. >> >> i am pleased to be here today. i know that we have a large group of witnesses here today. i will withhold my opening statement. i have some questions during the q&a session. >> we are glad you're here. thank you for your

participation. >> our first witness today will be john potter. he began his career in the postal service in 1978. he is postmaster general and has been so since 2001. our next guest is here as well. he is scheduled to serve until 2014. president clinton appointed him. thank you for your service. our third witness is david williams the inspector general of the u.s. postal service. he has a lot of experience.

he has been inspector general for five federal agencies during his career. our next witness is nancy. she is the says its director of the human resources and office of personnel management. thank you for your work. our next guest is no stranger to this committee. nameless said a variety of government programs. each of you will be recognized for roughly five minutes. try to stay as close to that as you can. your entire statement will be made part of the record. mr. potter, please proceed, and

thank you for joining us. >> good morning, mr. chairman. i appreciate the opportunity to speak with you today. i want to express my sincere thanks to the various committees for your tremendous progress in moving s15 forward for consideration with the senate. thank you for supporting a strong and national postal service system. enactment of this bill will enhance our liquidity at a time where we really needed. it would reduce our projected losses by over one-third in 2009 and 2010. we support those amendments, in particular one that improves hour arbitration process.

another then accelerates the report on our business model. this will initiate a broader debate about the manner in which postal service can help the american public. i offer you my full support and cooperation as we work with these goals. we believe that a fundamental restructuring of the legislative and regulatory framework of postal services is required. that is the future of what has been since the nation's founding. the right of every american to send and receive mail. the postal service exist as a governmental entity whose mission is universal service to all. that mission is a direct reflection to the values on which this country was founded. those values of equality and opportunity continue to drive

the postal service today as they have for more than 200 years. to adjust the challenges we face, which must push operational efficiency to the limits permitted by current postal laws. when must foster growth by increasing products and services to our entire spectrum of customers. it is possible by enhancing our performance-based culture. we need an extraordinary amount of commitment from postal stakeholders. the cost of underwriting and ever expanding universal service network and other government obligations are needed. a modern, self-sufficient postal system can be constructed to continue to provide universal service for all at affordable prices. to do so requires new flexibility to adjust not

corpses and services and to minimize trans governmental and work rules and expectations that carry with them costs and inefficiencies. it the post a community is up able to achieve this, then it appears to us that the remaining option will be more unpalatable for more stakeholders. the postal service must operate at of its antiquated business model until they are able to have a new model. these statements are taken almost verbatim from the transportation plan we developed in 2002 at the direction of congress. we achieve in exceeded many of the goals of the plan. service and customer satisfaction continue to set new records. we have removed more than $40 billion in humans of costs,

increasing efficiencies as our delivery base and its costs have grown by the addition of a loan -- 11 million new addresses. we are innovative with pricing and initiatives. we are producing results. our employees are more engaged than ever. even with the success of these efforts and new levels of flexibility, our situation is more tenuous than ever. this does not reflect a change in will but in priority for a change in command of. it reflects changes in the economy and the use of a male patterns. the costs are beyond our authority to control. the issue is not the value of the mail despite the best technological changes in the last decade. the male is still a fight -- vital channel for financial, personal, and business communication.

it is one of the most structured services in america. it is one of the most effective. the offer is unsurpassed value. we are working to increase the value each and every day. at the end of the day, for focused uncomplimentary efforts, we can protect a vital and vibrant national postal service. it must continue to bring efficiency of service to the highest level. we must identify a new business model that will offer success in any business environment. ms. close the gap between our revenues and our costs. we want to increase efficiency to narrow the gap even further. we cannot only eliminate that gap of return to profitability without placing any financial burdens on the american

taxpayer i going to a five-day delivery week. it will take patience and cooperative efforts by everyone who has a stake in emailed. we must advance the common interest. the nation's mail system was created to serve everyone equally. equally. this must be our only this must be our only goal to preserve that finest male system in the world. that concludes my statement. i want to thank you for is your support of legislation that would reduce our costs. i will be pleased to answer any questions you might have. >> please proceed. >> chairman, ranking member mccain, ranking member colin, chairman labor -- lieberman, and others, thank you for this opportunity to testify today.

i am honored to be participating at this hearing. as many of you know, i served on the commission for 11 years with many opportunities to support and second chest -- second-guess the chairs. this is my first opportunity to speak in front of you myself. the testimony i submit it had been prepared with consultation. all the commissioners are in general agreement with these matters. there are some different emphases. i think your comments and those of the postmaster general happily described the financial situation in which the postal service finds itself. suffice it to say that their revenues are down at least $6 billion this year, and at the end of the year they may well

need additional congressional action in order to meet all their payments. to put into perspective, however, ups and fedex have had revenue declines of 11% and 21% respectively. this is a difficult time for the industry as a whole. the postal service has responded to revenue loss with the most aggressive cost-cutting in its history. on the up postmaster general, the services have been cut -- over 60,000 career positions have been taken out. another 100 my work hours taken out this year. an evaluation of the services, management and labor have worked cordially to streamline this system. we are confident that they are

going to be in a responsible for cost control in the future. at the request of the subcommittee on federal work force, the commission examined the underlying methodologies used by the office of personnel management to determine the postal service's unfunded liability for its retiree health-care benefits. you have received full copies of those reports. they are available online. hopefully our analysis will be helpful to you in this committee consider a long-term measures to address funding to the benefit fund. the commission developed an alternative calculation to those provided by the other agencies utilizing current industries and best practices. this produces a long-term viability the could result in a

lower payment per year than the law requires. the regulatory commission is also in the process of reviewing the postal service request for reduction in post offices. we have initiated a docket to review the matter. amid reports have been inaccurate about the process. let me be very clear. the law gives the post a regulatory commission the authority to review the process the postal service proposes, not to decide on a merit of closing individual facilities. the review does require us to look at the potential impact that such closings would have on communities, the adequacy of financial analysis developed in

planning, and participation in the process. operational changes could affect services nationwide. they must consider that. recognize that congress would have to allow such a change. whether it is a five-day delivery, collection box removal, or closure of facilities, the postal service seems intent on reducing its physical presence. no proposals he been put forward to find new sources of revenue at post offices such as part during with other public agencies -- partnering with other public agencies.

how the postal service fits into the framework of american society is now being asked. the committee is aware of the impact the postal service has on our nation's charities, the political process, and the overall flow of information. voting by mail is increasing exponentially and the country. not long ago, people service demonstrated its ability to bind presidents together when they had to make various locations -- the elections even when people were dislocated during hurricane katrina. 95% of people responded felt the post office was important to them.

while cost savings are important, the regulatory commission has a role in determining whether these cost- saving measures are beneficial in the long term or counterproductive in terms of providing ongoing support for the postal service from the community in the nation as a whole. it's also accountability has provided various things. potential new markets could be developed around hybrid products. standard mail product with a guaranteed data delivery is an example. opportunities to better use the existing facilities have yet to be explored. the american public demands effective, and affordable

nationwide service. >> i am going to ask you to wrap it up. >> ok. the commission stands with the west of the committee in congress to work towards any changes that will be required of us in the future. >> thank you. >> thank you mr. chairman and members of the committee and subcommittee. i appreciate the opportunity to discuss the retiree health-care liability for the postal service. that is currently threatened by new communications technology and the economic downturn. this situation has turned into an immediate crisis because of the diversion of cash to pay for future retiree health-care benefits. the first six months of this year's payments was $2.7

billion. the postal service would have made $400 million instead of losing $2.3 billion in the first half of 2009. the postal service must make 10 annual payments of money for running this. the size of the $5 billion payments and the current payment method is damaging the financial viability of the postal service even during profitable times. the postal act should not affect the federal budget deficit. the postal service is not part of the federal budget and does not receive an appropriation for operations or make its money from the sales and services. the payment amounts are fixed

through 2016 and to not reflect the of earnings estimates. declining staff size and the ball must in the pharmaceutical and health-care industries -- during the current economic climate to the postal service must abortion certain places. it must borrow to pay a debt that will be incurred in the feature is a controversial practice. beyond the prominence with the payment, it is important to know -- beyond the problems of the payments, it is important to know if the postal service is obligated. the estimates of the liabilities estimate how way the postal service will have a funded its retiree health obligations and

the proper funding levels given an adjustment to the assumptions. health care inflation will average 7% which is higher. that is the inflation rate often used by fortune 500 companies. the payments are aggressive, reducing the postal service's unfunded liability more quickly than the typical pre-funding plans. by the end of 2016, the current payments will have created an accidental annuity. a 5% interest, a $400 billion fund will burn more than $5 billion a year. this is a significant amount of

money to recover retiree premiums which is predicted to reach $2 billion this year. it threatens the card crescents and the postal service solvency. it is forced to borrow during profitable years. it will be strapped during times of need. $26 billion would be unfounded by the year 2016. we want to provide more achievable financial goal. new payments will take into a can't -- account the substantial annual earnings. amos should be reset periodically -- payments in be reset periodically. it would take into account new innovations and rates in the insurance sector.

the retiree health benefit obligations should be derived mathematically. i am aware that there are voices under committee called for the proper payment level to be set at the time the payments will be started. i hope these voices will be heard to adjust this debilitating problem. the postal service can more realistically address the serious challenge and opportunities before it. thank you. >> thank you for that eliminating testimony. but >> i appreciate the invitation to provide the views regarding the funding of the federal employees health benefits for retiring employees of the postal service. we welcome the introduction of the bill which is intended to

provide short-term relief to the postal service in meeting its obligation to fund its share of retiree health benefits costs. in to a dozen 6, congress enacted the postal accountability enhancement act which requires the postal service to pay the employer's share of post retirement premium for its employees in the similar manner to allow federal agencies fund retirement employee cost under the federal employee retirement system. despite the cost of future retirement benefits while individuals are employed. pre-funding retirement benefits insures there is sufficient money set aside to pay benefits without further contributions. in the same way, the purpose of preventing premiums by the postal service is to ensure postal employees will have employer funding available for health insurance after retirement.

the law created a new fund providing for initial deposits related to the system and the amount held in escrow as a result of higher legislation. one public law provides the postal service will make the annual pay as you go until 2016 was annual payments unspecified amounts that reach 5.4 billion- 5.8 billion a year. some obligations totaled about $5 billion. beginning with 2017, the pay-as- you-go cost will be paid to the fund and the annual payment will equal amount actuarially

determined by allium. we have reviewed the zero ig report and disagree with its conclusions. the postal position is based upon a study for the group which used different assumptions will buy those used by obm. the use trends at a higher rate and decrease in to an ultimate average rate of 5%, the other report applied the 5% throughout the projection. it also did not study experience that covers the postal service. we believe that opm is appropriate. the assumption is based on careful consideration of the historical trend of the program. the program differs from other retiree medical programs in several respects. retirees and employees are covered under a single program and participation in medicare is

not required. both of these program features drive premiums upward. last week the postal regulatory commission released a report which include a review of this assumption. it applied variable trend rate with increases as high as 7% until 2016 and lower thereafter. trend assumption produces a result that is similar to the 7% used by the other report. the mercer report states that a 7% trend rate or higher would be a reasonable trend assumption and is consistent with the historical results achieved. both opm and hay have a discount of a certain percentage. had they applied the same methodology to their analysis as

they did to their trend assumption, they should have something substantial or around 6.2%. we believe it is very important to make and supply assumptions consistently. opm has no objections to a legislative changes. we believe the bill which provide temporary relief to the postal service and the financial -- in a financially responsible manner. it would begin paying if normal costs for employees today along with a string of payments towards unfunded liability. thank you for the average city to discuss this issue. i will be average -- any questions. >> thank you for that. >> i am pleased to be here to

discuss the issues of the u.s. postal service. i will provide an update on the financial condition and now look and explain the recent decision to place its financial situation on our high-risk list. a lot to talk about addressing current a long-term challenges. the postal service financial situation has deteriorated sharply over the past year. the volume is projected to decline 28 billion pieces this year. that loss is 7 billion which has been mentioned previously, an increase in outstanding debt to 10.2 billion. an unprecedented 1 billion cash shortfall.

the outlook for fiscal year 2010 is even more challenging as the services would point to an increase in debt. around 13 billion. businesses and consumers a move to electronic communication and payments. the postmaster general says there will be a -- more declines of pieces of mail next year. we believe that restructuring is urgently needed. no single change would be sufficient to address the postal service challenges. cutting costs quickly enough is a challenge. the long-term challenge is to

restructure the operations, networks, to reflect changes in mail volume. we have called for the postal service to develop and implement a broad restructuring plan with input from key stakeholders and approval by congress and the administration that includes time frames for action. we should reflect changes in the use of the mail, better align costs with revenues, optimizing its operations, networks, and work forces, increasing mail volumes and revenues were possible, and retaining earnings and repay debt. turning to restructuring options in three key areas. .

in addition, and that cost could be contained by paying a lower percentage of health and life insurance premiums in line with those that are of federal employees. there are also savings opportunities and facilities. in the capacity nationwide, processing capacity for first class mail exceeds needs by 50%. about 30 percent of the postal service's retail revenues comes from stamps sorted by mail, and accordingly the network of 37,000 retail facilities offer offer consolidation opportunities. because costs cannot be the only solution, it is important to raise revenue through new or

enhanced posted profits. on it mandated study that will examine these and other options second lead to operational reforms of the postal service. we look forward to working with your office on this effort. this concludes my statement. i am happy to answer any questions. >> thank you. we are grateful to the gao. we have wrestled with these issues. thank you for your testimony today. i will ask our colleagues to remain within the timeframe. we have time for a second round. we are not going to have any votes on the floor until 3:00. hopefully we will conclude here well before that. i would like to start for the

panel to weigh in -- that was very helpful testimony. i learned some things. it was fair and balanced. it was interesting to hear from mr. williams and mrs. kichak. almost everyone -- one thing we all agree on is we have to bring in the costs of health care. we will pass legislature this year on bringing down the health care costs and extending coverage to those who do not have it. i will ask you to weigh in on the debate we had last week, a bill the we have introduced to reduce the postal service for this year and the next several

years to give the postmaster general and his team the breathing room they think they need to get through these tough times. we think the legislation will buy them the time to attract more business. an alternative approach put forward by a colleague would provide some relief this year in order to reduce payments later in this decade. i would like to get the panel's thoughts. i will start with you. >> mr. chairman, in terms of the approaches, i support what came out of committee. it provides short-term relief. i understand the point that was made by senator collins that at the fact -- at the end there would be somewhat underfunding

by about $4 billion and her proposal saw to address that. in the immediate couple of years are urgent. i would support the proposal as it came out of committee. it provides more short-term relief and it gives us an opportunity to further discussion about the public policy issues are around the six or five-day delivery and other things we need to do to address these things. >> if you could keep your responses brief. >> the postal service needs some immediate assistance. your bill 15 07 -- your bill 1507 does provide some relief that is financially responsible. i would say the commission's review of the issue of long-term

health care, retirement benefit liability differs from the opm in the number of employees before cast in the future. it underlines my earlier comment and my confidence that they will continue to cut. therefore, in any further review, the understanding of the lower number of employees may help to resolve the long-term liability issues. >> recall for us if you will the level of postal employees, say, six years ago. >> we hit our maximum number of career employees in late 1999. we had 803,000 career employees. we have been addressing the diversion of mail to

electronics and have been managing our work force aggressively. we have 630,000 career employees. we have managed to reduce that by over 170,000 people, the number of current employees we have. if you look at where we are today compared to last year, we are down 37,000 career employees. we're down over 40,000 if you include non career. >> we are supportive of 1507. we like a lot of things about it. it pays current employees out of the fund. it is based actuarially, which is useful. it addresses the time from the date of the employment all the way through employment. that is a good feature. we do not believe 70% is a

sustainable rate -- a sustainable inflation rate. we think 5% is much better. nobody is paying seven%. the last thing is, we think it would be useful if we revisited this occasionally and if we used postal service-specific data instead of large data. we would want folks on a more recent times. the medical industry is almost unrecognizable at that. of time. >> thank you. >> he said a lot of things i like to address. let me say that with 1507, one of the things that is very powerful the way it is addressed is that the postal service is going to pay the accruing cost every year for its employees.

if they are able to bring down the employment numbers, it can control that part, which makes projecting what the loss is immaterial. those payments will be based on the actual numbers of employees. >> thank you. >> >> we approved the short term relief from these payments. they're in a difficult financial situation and this is one way to help them get some breathing room to come out from underneath this. we would like the issue be tied to a broader restructuring. a quid pro quo said that there is something given in return. -- so that there is something given in return. >> mr. potter, please be brief and responding. the obstacles that faced the

also servers are greater cost. you were downsizing your payroll and the number of employees. you can try it closed some facilities. postal offices, some of the stations, the satellite stations. you can close down processing because there is over 400 of those. you can try to create new business opportunities. i want to go there and talk about very briefly some of the things you are doing right now. the language of the bill we passed three years ago as allows you to be more entrepreneurial. >> thank you for that question. what are we doing? we are taking advantage of pricing opportunities and flexibility that is in the act.

we now have our package services, contracting with different companies to get their businesses. we did not have that ability in the past. we now have different pricing based -- based on how you access postal products. we have pricing if you go online, pricing if you have some volume. we are offering some volume discounts. a different price if you comment and use our lobby services. we have a summer self to encourage people to advertise with us. our intent is to keep going with this kind of flexibility. we have increased the numbers of sizes and shapes for our priority box that have been doing very well in the market box -- in the marketplace. we have to think about the fact that we have a network of 37,000

retail outlets. america loves them. we cannot just sell stamps at those outlets. stamps and mail, there is a substitution factor going on. i look at -- i look around the world. in australia, if you want to renew your driver's license, you go to the post office. if you are in japan and you want to buy insurance, more likely than not, you go to the post office. i think we have done a good job of trying to sell malil. i think we have begun to scratch the surface. >> thank you. senator mccain. >> mr. potter, the belief that

we should implement many of the recommendations of the gao in their report that mr. herr just mentioned? >> yes, i do, senator. we have been working very diligently to implement much of what he talked about. if you look back in the year 2000, we had 446 mail processing plants. today we have 355. we have taken out over 20% of our mail processing plants. >> how much has your volume dropped? >> our volume has dropped a similar amount. if you look at where we were -- at where we are now obverses last year, our volume is down to 0.6%. 80% of our cost is labor.

it is down over 13%. the one area we cannot control our costs is delivery. moving from door to door six days a week is a fixed cost. if the volume declines, that portion cannot be adjusted by the fact that mail volume has declined. we have gone from 5.9 pieces of mail on average to every door since 2000, down to 4.1 pieces. we have managed aggressively to take cost out to offset that loss. i think we have reached a breaking point with the recession. that's why we're seeking to go from toto five-day delivery -- we are seeking to go from six to

five-day delivery. >> so you might not make the payments. is that correct? >> we would be approximately $700 million short. >> you would not make payroll. so what adjustments need to be made? >> in january, recognized that this was an upcoming issue. >> you did not predict the size of those losses. i think we can go back to the record. >> that is true. they have been accelerated. the $2.4 billion loss in the quarter, there is some bright news in the sense that if the look at quarter three verses quarter towo, $800 million is a

compensation, noncash adjustment. interest rates will be low. we have had to make a noncash adjustment. the net present value of what we had there has declined. it will not earn as much. >> we only have seven minutes. >> it went down from quarter to to quarter 3 -- from quarter two to quarter 3. my preference would be the we get legislation passed that would address the health benefit issue and then we would be able to meet all of our obligations. we would not pay the full $5.4 billion payment. >> mr. herr, what is your assessment of the measures the postal service has taken so far?

as to what actions need to be taken in previous gao reports to congress. >> as we look at the situation this year and we consider this, we felt the considering the service provided, the challenging conditions in terms of the financial situation they face and coupled with a paradigm change in how people communicate, we felt we needed to put them on the high-risk list. >> i understand. how have the reactions of the postal service been in complying with or agreeing to the proposals you have made to improve the situation, which is very serious? >> on the delivery side, there

is a big agreement to do readjustments of routes. that has resulted in some savings. the issue is that -- >> what haven't they done? >> there are some studies under way. >> processing, meaning what? >> doing more consolidations. i mentioned that first-class mail, processing exceeds -- the capacity exceeded the need -- >> isn't the problem the benefits? >> 80% of their costs are salaries and benefits. through attrition, you would be able to cut those costs, as well. >> it is my understanding understandingup that ups pays a

higher percentage and usps pays higher life insurance premiums while other federal agencies pay about 33%. there is certainly a significant difference there. >> that is a. we have been making and in prior reports. the differential of there, it would be around $700. -- $700 million. >> that still doesn't get -- >> no, it does not. >> what does it? >> i think you'll have to look more broadly at the infrastructure. the other thing is the salary and benefits. you have to streamline the work force.

>> i thank you, mr. chairman, and i think the witnesses. college just ask one more question? are you aware of the pending -- could i just ask one more question? are you aware of the pending legislation? how do you view it? >> it is a short-term fix. i would think it should be coupled with a restructuring effort to start this moving forward and see this as getting them through the short term and to lay the groundwork come out of this in what is a real looming financial problem. >> thank you. >> senator lieberman. >> thank you to all of you. i think testimony highlights what we're coming to understand, and that is all there are no easy choices here. none of us want to close any

postal facilities. none of us want to go to a five day a week delivery as opposed to six. i fear we will probably have to do both. the alternative is increasing fiscal desperation for the u.s. postal service. the alternative to that -- it all comes back to us. you cannot keep doing what you're doing. the money does not come out of the air. either we have to raise taxes to pay the growing, surging deficits of the postal service, or we will end up doing what is easing but very wrong, which is putting it on the government credit card and delaying payment for coming generations.

that will have terrible consequences on our children and our grandchildren. i cannot say that enough. i think all of us, mr. potter, week in congress, have an obligation to bring the public where we are in this crisis. they do not want any postal facility to close. but the alternative is a higher taxes or putting off so their kids have to pay. i think you'll make it easy for them. i want you to take a moment to explain what the difference is between a post office and a branch or station. as i understand it, you are not talking about closing post offices. >> that is correct. the difference between them is

that a post office is generally a zip code that has one postal facility within its boundaries. a station is part of a larger post office located in our bigger cities. so in chicago, los angeles, new york, the geography of that city is broken up by different postal facilities. in some cases it is a station which has delivery and retail which can just be a store front will sell postal services. we have a review of our big city post offices. we spend $16.9 billion on those operations. 2 billion of which are for non personnel costs. it is a matter of reviewing what is 1/4 of the expenses that are

incurred in the third 200 facilities. >> i hope that is hopeful -- helpful to people. you say the workforce is down 170,000. >> over 170,000 since our peak in 1999. >> am i right that there is a no-layoff clause between the postal service and the workers? " there are no-layoff clauses in the contracts. there are different levels of protection depending on the contract. there are employees that could be laid off. the contracts are very complex. if you laid off career employees, if you would have to stop using non-career employees.

the carrier craft could be laid off but we have 15,000 career employees there and we have to deliver 6 days a week. you would like to lower your costs, but you still have to perform best delivery six days a week. therein lies the dilemma. >> the way that you have produced 170,000, almost 20% by which is said, is by attrition, i presume. >> yes, it is. we capture all the attrition that we can. we have been very aggressive about doing that in the last couple of years because of the downturn. as i said earlier, we eliminated -- we reduce some 37,000 career jobs in the last year. that is actually higher than the normal attrition.

we have voluntary early requirement options for our employees to increase the amount of people who might consider leaving. >> as you know, and we will hear from the second panel, the groups representing employees and others are unhappy about the amendment added in the committee that said that binding arbitrary -- arbitration is a condition of the postal service. he said in your opening statement that you support that. i wonder if you could indicate why. . to the arbitrator in the law. it says they should consider paying wages comparable to that. it is a very broad direction. in the past, arbitrators have assumed that language meant the employees worked similar to the police. if you just take verbatim what

that directive is, it does not in any way shape or form linked to what the financial position of the institution is. i think that by ending that phrase, you're bringing a balance to what an arbitrator would consider when it comes to the postal service and how you would view each of these agreements and how critical they are when 80% of the costs are there. >> do any of the witnesses oppose that amendment? >> no, sir. >> if i might just add to the record with regard to your question about definition of post offices. the postal regulatory commission has a different interpretation. the service is defining post offices in terms of its

administrative organization. who reports to whom. they define it in terms of the service actually provided in the community. to the extent with which branches function like post offices, we define those as post offices and expect and anticipate that all of the laws regarding closing post offices cover those stations and branches. >> i appreciate that. i would ask you to submit to the committee what the definition is. where do you draw the line? the definition is quite clear. when dusk a branch become a post office in the definition of the commission? >> thank you. we will do that. >> senator collins. >> thank you. >> thank you. mr. herr, i support changinthe

payment schedule for the postal service to give it some relief to get through this difficult time. where we disagree is in our assessment of what the increase in the unfunded liability want to bid and also in our evaluation of the postal service's ability to pay for greater amounts into the fund in the second five years of the 10- year period. i have worked closely with the gao come up with the amortization schedule that i proposed. as i indicated under sinner harper's proposal, it would -- under senator pop -- under

senator harper's proposal, it would still increase, but it would be $500 million as opposed to $4 billion. big difference. i want to turn to the second issue, however, and that is whether it is realistic to expect the postal service to be able to pay far more between 2015 and 2019, that second five years, then is the case under current law. under senator harper's proposal, the postal service would have to pay $6.3 billion more into the retiree health benefits fund then is required under current law in the second five years. under the bill the committee reported, it lowers

substantially the payments for the next five years, but then ramps them up to the tune of $6.3 billion over the current law schedule. how optimistic are you that the postal service's financial situation is going to improve so greatly that it will be able to pay $6.3 billion in payments above what would be required by current what? >> senator collins, i think looking at the situation the postal service is in now, if there is not dramatic and rapid change enacted, it would be difficult for them to make those of larger payments. we believe this restructuring plan is important going forward. however the committee decides to move forward, we believe it

should be the need to get a plan de will help the postal service move forward and deal with some of these structural problems. >> again, i support providing some relief to the postal service because we truly are in a crisis, but i do not want to be back here in 2015 having the postal service say to us, boy, there is no way we can pay these ramp-up amounts. that is exactly what is going to happen. that is why i think the proposed schedule that my staff and i worked out with the gao is a far more realistic assessment. it still provides relief. the difference is an increase in payments of $1.5 billion vs $6.3

billion. we half to be realistic. mr. potter, the postmasters have suggested that one source of savings from retail operations is to negotiate with the unions about cross craft trainin to have more flexibility in the workrooms. are you presuming what seems to be an excellent suggestion? >> yes, we are. we have had similar discussions in the past. >> are you optimistic you're going to be able to implement some changes in the work rules that will save money? >> i wish i could be optimistic. having discussed these issues in

the past, we were not successful. hopefully the conditions we have today will have people be more open to that level of flexibility. >> let me return to the question i raised with the gao. what are your grounds for believing that the postal service will be able to pay $6.3 billion more in the second five- year period that would be required? >> i have two reasons to believe that the $6.3 billion would not have to be paid. there is an assumption in the modeling that was done in the number of employees. that number that was in the initial analysis assumed there would be a growing number of employees. we have today 630,000 people.

i also believe the country cannot survive with an inflation rate on health benefit cost of 7%. i believe the senate, the house are having significant debates about that very issue. as the second largest employer in america, i can tell you that that issue needs to be successfully addressed. i think the burden is on every business. it is those things that make big optimistic. i believe that our target will ultimately be about 550,000 employees. i am optimistic that you'll see the type of changes in our system that will lower that cost. i'm hopeful the health benefit cost will be mitigated. >> i am going to have to leave

for a while for a meeting that i cannot miss, and i will return. i realize this panel will have finished. i do want to point out another issue as i am leaving, and that is the postmaster general's testimony request that congress lift restrictions on the ability of the postal service to get in to new non-postal lines of business. the postmaster general has indicated he is interested in getting into banking, cell phones, logistics, all sorts of lines of businesses. i want to point out to everyone that the postal service cost past forays have had very little success. gao did a study in 2001 that

concluded that none of the earlier initiatives was profitable. i would also point out that there are competitive issues here if we are allowing the postal service to compete with the private sector on non- postal areas. this is an issue that has not come up today. i will be submitting some questions for the record. >> i hope you come back and rejoin us. [laughter] i really do. take just a few seconds. you said -- i did not understand what you said. >> i did say that. let me just respond to senator collins. we're not spending a nickel on exploring any of these ideas.

i was simply using that to illustrate that other countries, when faced with the same dilemma we are faced with, have provided more flexibility in that regard. >> are you asking for that authority? it was my understanding you're asking us to repeal the prohibition -- >> i would assume that will come up with the regulatory frameworks alleged any proposals which would make would have to go to the regulatory commission. i think there is a real issue on how we generate revenue out of these over 30,000 retail outlets that we have. whether that is broadening. we can do there, i think it's something that needs to be addressed. do we have them or do we not have them? >> i am sure we will turn -- we will return to this issue again.

>> thank you. the panel has been in lightning -- has been in lightning -- enlightening. as a new member of the united states senate and -- a person who receives a great deal of mail, i find a lot of this information disconcerting. in terms of, what are we going to do. i see the number of post offices and branches being closed in chicago and in the state of illinois. in terms of the 667,000 -- -- in terms of those branches being considered for closure, how is the study being conducted? what criteria are being

considered? how many possible layoffs would be involved? >> let me describe the study. we have 3200 locations. it is almost as $17 billion space. when we ask in the initial round is for local facilities to determine and do an analysis on what facilities they have to look at space that is available in those facilities and surrounding facilities to look at what traffic we have. look at fath -- back room operations to see if they can be consolidated. again, it can be conducted to identify candidates. there will be a further review of in-depth analysis of around cost benefits to the postal service. it could be realistic

opportunities to the postal service. that will be done at the local level. there is a pending issue in front of the postal regulatory commission. @@@@@@@@@ @ @ @ @ @ @ @ @ @ @ @h ) my understanding of how this

transpired is that we began as a nationwide effort to conduct this review. at one point, we were asked to provide an update on all 3200. there was an interim list list that is very fluid. it got published. >> i have so many questions. how many people are we talking about in terms all playoffs? >> there is no intent to lay anyone off. >> so you're going to do all this by attrition? >> yes. >> i used a post office in chicago that is on the list and it is scheduled to be closed. >> it is not scheduled to be closed. is still under consideration. the people who work in that

unit, in these big cities, they have biding rights to move. -- they have bidding rights. >> has any study been made on what it would take, and this is just an inquiry, a speculation of a first-class stamp to cover the cost. what would it cost? we're now paying 44 cents for a first-class stamp. would it have to go up to seven 5 cents? >> well, some prognosticators said it would have to go up about 15%. all of our rates would have to go up 15%. i caution you to say -- given a pair financial situation and the fact that substitution is a

reality, each of their products could move through a different channel. raising rates is just going to drive mail away from the system. there is a misnomer here that the bulk of our revenue comes from citizens buying stamps. over 75% of our revenue comes from commercial entities. it is catalogs, its banks. think about what you get in the mail. it is those folks that make decisions -- >> would rate increase is applied to those items? >> any time we raise rates, we calculate the fact that the rate increase will drive people further away from mail. >> i am not advocating that. you looked at that.

you are nodding your head. >> we try not to do that simultaneously. we try to validated and we will work with your office so that you are aware of that. >> another question i have. in terms of the use of technology, and mr. harris said there is an excess of processing. s -- has the postal operation kept pace with the technology and the processing of the mail and packages and the various delivery -- in order to deliver the various items to the public. has the technology kept pace, or is that something that would cost of additional moneys? >> we have the best mail processing center in the world. you put a letter in a collection

box, it is not touched by a human being until -- it is read by machines. >> is it sorting to the light? >> to the light? >> technology. >> again, i invite you to come and visit a post office. >> we will talk about that. my time has run off. i tried to push the postmaster. i did not know if you have a second round with a paddle. >> we have another panel to go. i will not be taking a second round. there'll be other questions. this has been a very good back and forth. >> thank you. i will try not to use my seven

minutes. in your estimates, you showed a continuing decline in first class mail buying until 2011. do you stand behind that backs >> it is not a resurgence in the sense that -- >> deal still think you'll see an increase in first-class mail? >> the number of transactions has declined to. people have stopped using credit cards, they do not get a credit card bill at the end of the month. that would drive some. >> you do not have a dinner bet on whether that would happen. >> everything i see in my life, people who used to melt a church

bolten, ascended by -- people who used to melt a church bulletin, they send it by e- mail. i think that is too optimistic. >> we can say a drop in john q. public putting stamps in the mail. it reflects the commercial use of mail. >> that is what i am talking about. i get my bills not through the mail. >> i wish you were a better customer of ours. >> i appreciate your service through the rain, snow, and sleet. this is one side of the equation. do you have any comments on the protection of revenue? >> we have not -- the

information we have indicates it will not be as bad pass it is now. it is unlikely to return to levels that existed before we went into the crisis. >> i wanted to point out a figure on my statement. we show the percentage of payments in 2008. the mail payments are down to 56% and the electronic are up to 38%. >> that rate of change had not changed. >> the lines are merging. >> they are on a straight line. the slope of the curve is it is staying steady. you'll see an increase in that type boat decline. >> people will begin to move to these kinds of payments. >> i wanted to add that the

commission used to get volume estimates on a quarterly basis prior to 2006. it might be beneficial for them to resume that practiced in light of the recent experiences. >> the forecasts are not accurate. >> we would have a better opportunity to examine what they are. >> i do not disagree. they are highly inaccurate. we have had these hearings for three years. those of us who have been pessimistic have been much more accurate. the -- you have 637,000 employees. what is your fully absorbed labor costs? >> it is $57 billion.

>> $57 billion. it comes up around $83,000 per employer. it is fully absorbed. would be any benefit of having postal employees having the same benefits? >> there would be about a $600 million cost. >> that would be if they had that. if in fact you could achieve -- safeway has 200,000 use a nice employees. they have had half of 1% increase in the past four years. they have a healthier workforce with last time off because they are intervening and incentivizing people for weight- loss. why is it we would not want to sit down with your audience and

say, here is a unionized work force that has helped their company but has had less out of pocket costs. why we did not want to model that after what safeway has done? >> i personally would. in years past, under a different administration, we went down the path of seeking to determine whether or not we could withdraw from that and it was strongly -- we were strongly advised it was not a path to seek. >> your average cost is higher. >> i do not believe so. i would have to check. >> i believe it is. >> i am not sure, senator. >> so if -- we're going to solve

your problem in the short term. the question for the american people, what is the long term? how are we going to solve this? i believe we could give you the flexibility to go to five days. i think we should keep the flexibility to do what you want in terms of your core business. but what i do not believe we should do is continue to just get out of one crisis and moved to the next. my hope is with hearings like this, we will look at the real issues and be realistic to the american public. ultimately, if in fact future health care benefits are paid for, someone will pay for them. it could be the u.s. taxpayer.

>> the quicker we do with, the better off we will all be. >> there is a difference in terms of the cost of that. you subsidize 85% side of the premium. >> i understood that. >> i agree. i thought you were talking about within fahb if you looked at the 100%. i believe our employees take lesser plans. blue-collar people tend to be healthier. it is great. that is what was in my head. >> thank you. senator cochran, please proceed. >> i think you for having this hearing. i want to also thank the witnesses who are participating today. the postal service has shown the postal service has shown signs

-- it still faces that. the government accountability office recently placed the postal service back on its high risk list. i am very much in favor of extending the need for assistance to the postal service to get them through this difficult time. most recently, this proposed six came in with the list that was passed last week. this would provide flexibility in funding for future retiree health benefits in order to close budget gaps over the next several years. however, i am disappointed that the marked up -- that it affected the bargaining process

and arbitration, giving the necessary deference to management by requiring that an arbitrator step in. the postal service's need is keyed to arbitration. this amendment has no practical effect other than maybe to consult and discuss -- discussed the postal workers. we should not have included this additional substantive policy change on this must pass legislation, especially with strong objections from some many postal workers. i believe that there is still time to address those concerns by recognizing the economy without injecting ourselves once

again into the bargaining process. mr. potter, in the first part of a service in hawaii met a standard less than 7% of the time. most were well over the standard. only 1/4 of packages were delivered within three days of the service standard. i am concerned about these numbers in particular, which are the worst in the country, i am also concerned about the negative image of the postal service that such -- we offered suggestions about closing post offices and reducing delivery days. i am concerned that the point may be reached when usps is no longer the carrier of choice due to lagging service and cuts.

my question to you is, what is the postal service doing to ensure that despite these problems, it continues to provide world-class and universal service? >> flubbing address the whole why the issue -- let me address the hawaii issue. we lost the shipping -- when you pay ground rates, we put mail on boats and moved to hawaii. we have had trouble finding a supplier that operated a frequency that would have a higher level of service. we're continuing to work on that issue and is one we know we have to address. >> commissioner goldway, the

obligations that found usps generally filling the obligation. it seems to me that some of the cost-cutting options and service reductions and closings could have serious effects. my question is, do you think the options discussed for cost cutting could cause them to reevaluate the postal service's fulfillment of the obligation? >> thank you, senator. i think the commission is in fact concerned about the proposals to reduce the footprint of the foes -- of the postal service throughout the nation. we will be looking at these proposals in terms of their impact on universal service. we hope to have public hearings

in the context of this end case. we may in fact review the universal service obligation study that we did two years ago to look at what ought to be universal service in this time we are in, or how universal service could be provided. i am concerned that the cuts proposed may in fact be counterproductive, and by reducing access to the community in these options they propose that there will be simply a last opportunity for the postal service to grow in the future. .

that likely, some of this would be in light of in addition to attrition. i have two questions for you. in the past, you mentioned a week they likely could be cut, so i would like you to address why and what change would be made to saturday? hell long would it take after the announcement of the five-day week to incur any cost savings? >> senator, the reason we moved

to saturday was because further analysis around volume -- only 11% of mail is delivered on saturday. in addition, one of the reason it is low on saturday it is many businesses are closed on saturday and we do not provide delivery on saturday today. if we could pick a day in the middle of the week, there would only be four days of delivery to businesses. that may be harmful to our position from a competitive standpoint. competitors cannot deliver on saturday without a surcharge, so we are positioned well in that regard. second part of your question? >> cost savings from this. >> we estimate $3.4 billion. in terms of how quickly we could

get it, literally the day that we start, we could start to capture the savings. right now, our thinking is once it is approved, reviewed by the regulatory commission, and approved in the sense that we have the legal authority to do it, we would provide no less than six months notice to customers to make adjustments to their operations. >> thank you very much. >> that me follow up briefly. i may have missed it in the back and forth, but other country with a five-day service, i understand they do not necessarily get rid of saturday service, perhaps wednesday service. post offices could still get some kind of service.

i am thinking of canada. during different times of the year, they go to a six-day service. is there a different way in the way that country's do this? >> most places eliminate the saturday delivery. our concept has evolved, and i wish i could take a minute to describe it. we want to keep post offices open on sunday, so we're just talking about delivery. we would provide box mail delivery on saturday. part of the reason for that is there is a lot of money that moves through the mail, and those recipients have said that they need access to the remittances that come through the mail. we would continue to deliver to post office boxes. we would allow customers to pick up their mail at the plant as it is generated.

in the american public has told us that they want to have access to postal personnel on weekends. maybe they were during the weekend, on saturday to pick up a package that they may not have been able to get delivered because no one was home. we would continue to operate those officers on saturday. what we are talking about in the $3.4 billion in savings is simply the elimination of the sixth day of delivery. >> one quick question, mr. postmaster general. if it is not delivered on saturday, it would be delivered on monday. that would mean an extra load. have you taken that into consideration? >> yes, we do have holidays. when we estimated our costs, going forward on our savings, that was a key part of the

calculation. it turned out, because the machine to sort the mail and put them in sequence, the bulk of the workload is absorbed by the carrier and our systems. there is really no additional cost -- limited additional costs as a result of moving that workload from saturday to monday. >> before we excuse the panel, i want to thank you for being here, helping us wrestle with this tough issue. we thank you for your leadership. we still have a second panel, and i look forward to their testimony as well, but i would just conclude, before this panel leaves, some say that there are no silver bullets, and i do not know that there are, but there are many ways to address these challenges. into unions have wrung a lot of

cost out of the system. we will see some additional reduction through attrition as well. as members of congress, we need to get out of the way. where it makes most sense for people to have service, that is something that needs to be done. i am not interested in closing numerous facilities across the country, but to the extent that some need to to get out of the way, you have labor negotiations coming up and we commend the approach that management is taking to those negotiations. frankly, the approach that union representatives are taking as well. these are not easy negotiations, we understand that. reducing mail delivery needs to be something on the table, and we have said that there are some

different ways to see how that can be crafted. if we do not have service on saturday, no service on sunday, and monday is a holiday, three days without mail service would be a concern. having gone through some tough to ways to save money, and i know that you have done a number of them, the issue of new revenues. i understand you are not hiring a lot of people, but perhaps you would hire a lot of outside of the box thinkers. people who can really come up with ideas to and generate revenue. you are brainstorming a little bit about how to generate revenue, but perhaps we could do some other things brown postal facilities. lastly, i had a conversation

with senator mccain and i spoke about the need to rein in health-care costs. every republican and democrat in the senate has said, as we move through discussion, as important as it is to extend coverage to those who do not have it, it is incredibly important not to raise the deficit and also to reduce the cost of health care. i agree, if we are still at 7% inflation rate for health care, not just for the postal service, our country would be in dire straits. it would threaten to bankrupt not just medicare but our government. government. we would further make our

-- we will go back to those consultants and ask them to help clarify this. in the meantime, we will work on that legislation and the rest of this. we look forward to working with you. >> thank you. >> thank you. >> tonight, frank which reflects on 15 years of political columns for the new york times. including his look at the future of the internet from 1995, the whitewater hearings and 9/11. "q&a," tonight on c-span. >> a little politics from the bbc, and debate over military operations in afghanistan.

tonight, nine eastern and pacific on c-span. >> president of bond is in mexico. did they will focus on trade, drug trafficking and security issues as well as climate change. that will also discuss the swine flu epidemic and u.s. economic recovery. an associated press report says that president barack obama -- the three leaders are expected to take a joint stand on the coup in honduras that saw its president ousted by the military. the president planned a meeting by president call the room and did not schedule a second session with stephen harper while in mexico. now, more on the president's trip from today's washington journal.

this is a big picture section. they're talking about a few things. one is their interest in epidemics. they will talk about economic crisis. there want to talk about drug trafficking and security and one issue is the environment. there is something going on in the three companies that they want to talk about. >> such as what? >> it's not clear if the three

koirpts will be in the position. but what their positions are on climate change. host: let's talk about the drug status. u.s. is the largest market in the morld for narcotics. obama and calderon in mexico are going to sit down about this. they are trying to change almost overnight the police system in

mexico. things flowing back into mexico from the u.s. market. >> there have been two major areas. so far 1.1 billion in aid to mexico as well as equipment to go after car tell leaders. the second part is what the u.s. does on the u.s. side. these are sales on the street which eventually get piped back into mexico. the real attempt to intercept is on the u.s. side. is mexico at war right now. i wouldn't say that. >> is this a crisis.

i was in parts of mexico. car tells are in charge of parts of life in the city. it is regionalized. the most important side is not really the threat on the side of the cartel. the cartel. we have dru¡ country. we have more here than in mexico. it's not as disruptive as it is in mexico where you see carteles taking over entire cities. mexico wants to get where we are

where police can't be as infected. >> h 1 n 1 sn >> huge issue. the mexico first case, it started. they are finding it deep in that. we are making sure we don't close borders. host: finally, economics? >> huge issues. 23-29% trade is u.s. and canada. china is rising but it is still

the most important trading relationship. we don't do thing that's hurt the other countries. there's concern in the u.s. about the auto industry maybe relocating partially to mexico. the three countries have a concern of can we help each other. host: our guest here from the woodrow wilson center and mike is on the air. caller: thank you for taking my call. maybe you won't cut me off too soon. do you think you will talk about the coming union the nashville highway from canada from u.s.

and mexico and the merger of all three nations? >> there hasn't been much interest. any interest there was is thinking is there a north american customs unit. we have three leaders that are skeptical of north neshg as an idea but they want to make sure retreat each other well. it would benefit american

workers if it ever happens but it is a project that will take a long time if it does. >> a tweet asking will the attempt resolve unfetered access to american roads by unscreened mexican trucks? >> no, i don't think so. what existed before was a demonstrate program for a limited number. about 34 or less mexico companies under significant screening process, they are trying to start that program again. this is something we had agreed to open up all trucking, all of our highways to u.s. trucks. i don't think that will happen

any time soon. that doesn't leave us out of our treat y obligations. i'm not sure that's going to happen at this meeting. >> from california, go ahead. caller: i'd like to afford the guest and your viewers that they can't understand mexico unless they have read a book called the blood drenched alters. it has left the country without a morale core. without reading the book, you don't have a clue of why mexico is in the moral mess that it is in today. host: from virginia for the

democrats. go ahead. james in detroit. caller: good morning. i'm happy to see someone like yourself on who knows exactly what he's talking about. previous to you coming on was micha michael sawyer. host: what's your question about the north american summit? caller: my concern is the mob rule over there and the killing because of the drug trade. i'd like to know if we are will going to consider legal liesing drugsfxp i think it would help california and the whole country

if we legal lies drugs and take these monsters out of business, you know. as far as what i was saying about michael sawyer, he's never been a c.i.a. agent. host: have you ever looked at this issue? >> we have. it isn't something we take a motion on. it is a major industry. legal liesing drugs opens up the market and takes away the market

from the cartel and gives the government some tax money. that could be positive. on the other hand, it's not clear yet what the health effects are. how is the president doing down in mexico? >> i would say he's doing well in a qualified way. he has made a commitment to work on organized crime going after criminal groups. they are after six or sefrn large groups. he's been determined to go after them and trying to buildup the capacity. that said, this is a tough fight. it is a tough struggle to change

institutions. we have to hope we can do our part on this side of the border. there's a famous saying in mexico when the u.s. sneezs, mexico catches a cold. some of this is reduced because of that. prime minister harper. i don't follow candidates closely. he has won reelection. he is interested in a relationship. i think he'd rather dialogue in the u.s. to his credit, he has continued to deepen