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>> senator kennedy's body continues to lay in repose. there are 20,000 people in line to view the casket. it will remain open. everybody walks through. we will have more coverage from the library in boston at 2:00 a.m. a memorial service will be held at the library 7:00 a.m. eastern. later in the day, at 530 eastern -- for 30 p.m. eastern, senator kennedy will be buried at arlington national cemetery in

virginia. we will have coverage on saturday. on tomorrow morning's "washington journal," we will continue with bruce vladeck and tom scully. later in the program, matthew a speech on his book "the secrets century -- the secret sentry." -- "the secret century." >> go inside the supreme court. hear directly from the justices as they provide their insight about the court and the building. the supreme court is home to america's highest court, the first sunday in october on c- span.

>> health and human services secretary kathleen says that passing health care legislation without senator kennedy will make things more difficult. this is less than 20 minutes. >> president obama is the administration is represented by secretary sibelius and the deputy secretary ms. green lead. we are very happy to have you here. i would like to congratulate you for picking what we think is the premier senior wellness center in the district of columbia. [applause] we also why you to know that it is no coincidence that we made this investment here.

this award, ward 4, had the highest percentage of seniors in the entire district of columbia. we are 80,000 strong here. in our senior residents are, as he met many of them in your discussions, about 38% male, 62% female. our residents, for the most part, live on their own. they live on their own homes -- they live in their own homes. they have private doctors. they look to our government to make sure that we are providing assistance for home health care, for example, and that we are also making sure that the services of their government meet them where they are, whether they are at the hannity home senior wellness center or whether they are in this mini- senior building that we have in our community. i want to thank mayor fanti for his commitment.

i know he is represented here by our office agent director. on behalf of all of the residents of ward 4, we would like to thank you for your commitment on reforming our system. we also want to let you know that the residents of all the districts in columbia voted for change and voted for a different center in their nation. we cannot be more thrilled to have you here. madam secretary, please know that the residents of the district of columbia and the residents of ward 4 look forward to hearing all of your information and being very active in the change that we expect for our nation. thank you, madam secretary. [applause] >> i want to introduce you. mr. greenly has joined us as well -- ms. greely has joined us as well.

as we look for senior wellness, we are looking at all aspects of senior life. look forward to hearing from you as well. >> thank you to all of you for being here. our role in this universe is to visit a wonderful programs like this and promote their good work. if you want to know what we do at the administration on aging, you just need to visit here. it is wonderful to be here with council member bowser to work with the mayor and dr. brown. it takes all of us working to gather. the mission of the administration on aging from the beginning has been to provide support for seniors, to help the senior aging community. we want to focus on health. everyone to focus on independence. that is what you do here. if you look at any of the program to have, the focus is on

nutrition, the health and exercise programs. i spent a lot of time talking to dr. brown could is becoming increasingly more important that we showed good outcomes. when we help a senior achieve good health, it must show. this started with a partnership that we have been working with the seniors and promoting your activities in the community. when we come here, we talk to the rest of the nation and say that we need to be doing this everywhere else. the good news is that we are. this is a good representation of what is going on in america. before coming here, we talked about -- my staff and i -- your name. you have essentially included wellness in your name cou. you cannot just refer to this as the senior center. this is the senior wellness center. by doing that, you have called out for wellness and health. those are important parts of

aging. not only do i understand that, but the leadership and the federal government understands that as well. president obama understands the importance of wallace and health and so does secretary sebelius. -- the importance of wellness and health and so does secretaries really is. i have known the secretary for a long time. -- and so does secretary sebelius. i have known the secretary for a long time. when she was the commissioner of insurance, she focused on seniors and health. she comes with a background and knowledge. please help me to welcome her today. [applause] >> thank you. it is great to be here in ward for a big thank-you to the councilwoman for hosting -- it is a great -- it is great to be

here in ward four. thank you to the councilman for hosting it. we went from table to table and heard from your greatest fans and supporters. you have a lot of cheerleaders out there. i think it is appropriate, when the nation is consumed with thinking about the legacy of senator edward kennedy, that we're here at the senior wellness center. certainly, there was no better chance in four older americans and then senator kennedy. i had a great opportunity to know him and work with him over the years. not only did he help to create and strengthen the older americans act, but to find a number of programs, including meals on wheels for seniors who cannot get too great centers like this, but rely on nutrition.

he will certainly be missed. in my opportunity to just visit with folks having lunch today, i heard about health concerns. seniors are worried about whether they can keep their doctor. what will happen in the future? what if costs continue to rise even for folks who have medicare coverage? what about struggling to afford prescription drugs? today, we are releasing a report that is brand new called "america's seniors and health insurance reform, predicting coverage and strengthening medicare." a lot of the conversation has focused on what will happen with americans who have no coverage at all. but it is important to talk a little bit about the health reform puzzle for those who have coverage, and particularly what

is going to happen with medicare coverage. there's a lot of good news in the bills that have been drafted by the house and by the senate so far. no longer will seniors pay for primary care and preventive care. a well-dressed doctor will be greatly polluted by encouraging screenings and encouraging checkups on a regular basis. it is ironic to me that we will pay for cancer treatment, but we do not pay for screenings to, hopefully, get a handle on it from the outset. >drug costs will be on health reform. the so-called done a whole -- 4 million americans are hit every year where they continue to pay a premium and get no help at all with prescription drugs. if that will dramatically be decreased. the overpayment to insurance

companies that currently is occurring with medicare advantage plans, that will cease to exist. what happens right now is that every senior on medicare and the bulk of seniors, the vast majority of seniors, that are not in medicare advantage plans, they are paying an extra $90 per year for the over subsidies to insurance companies for medicare advantage and not receiving the benefits. if the law is not changed. -- if the law is not changed, if reform does not of course, they will see a 21% cut in their pay. that is a carryover from the prior administration. it was not fixed. if people are worried about losing their doctors, there is no better way to lose your doctor that to cut their pay by more than a fifth.

we try to keep folks delivering care. there is a lot of good news for medicare beneficiaries in health reform, not the least of which is that, without making substantial changes to the overall financing of medicare, it is scheduled to run out of money in 2017. so the status quo just will not work. it will not work to provide essential services to wait too many americans. when the president talks about health insurance reform, he is not just talking about the americans with no coverage at all. he is talking about what happens with small-business owners who are being pressed. what happens to folks who are being forced at of the insurance plan to have gotten ill and may have a pre-existing condition and cannot get into a new plan? and what happens to the 43 million americans, like a lot of folks here in your center, madam

director, who rely on medicare to provide essential health services? health insurance reform is about all of those americans and will make a huge difference in not only the costs that they pay, but the kind of quality care they receive. with that, i would be happy to answer a few questions. yes, sir. >> you mentioned senator kennedy's legacy yesterday's. what do you think about the legislation bearing his name? >> well i want health care reform legislation to pass. i think that naming is a decision that the united states senate will make. i think passing it is the big first step. that is what senator kennedy would want. certainly, having a tribute to him would be very appropriate. there was no better champion. this was a life goal of his. i think he delivered his first

speech about the right of americans to have health care across this country in 1969. he has been having this conversation for a very long time beer >> what about kennedy's legacy? there are 2 cents to his -- for a very long time. >> what about kennedy's legacy? which part of the legacy is most useful to the democrats right now as they go forward with the debate? >> you need both. you need a principles and to know what the fundamental things are that you believe in and to get things done. senator kennedy had both. he had a belief system and a constituency that he represented strongly and advocated on their behalf, knowing that in light of the people he spoke for had no other voice and had no other champion. at the end of the day, he knew that making progress on issues

was critically important. i do not think it is an either or. i think you need both. >> in following the strain of the senator kennedy, and, looking forward to health care reform, what does it mean to negotiations right now? we know that his staff and senator dodd were very involved. do you have comments or thoughts? >> -- i have no doubt that he will be missed. his physical presence have been missed over the past several months. he is not only knowledgeable, but has decades of relationships with people and a lot of legislative process is about relationships. it is about putting people together and finding some common

ground. senator kennedy did that as well as anybody. that will certainly be missed. people are truly interested in honoring his legacy and there's a lot of conversation about that. the best possible legacy is to pass health reform this year and have a bill that president obama can sign. hopefully, at every step along the way, they will ask themselves what will teddy do it and move things forward. >> the naming of the legislation is as important as passing the legislation itself. do you see it as more of a challenge now that he is gone? >> sure. there is a very strong voice missing in the senate. that always makes things more difficult. i think there is no question.

the health committee bill reflects a lot of what the senator believes. he was intimately involved, even at a distance, in framing that legislation. he has been advocating health reform for 40 years. so that does not want to be lost on anyone. advocacy is not going to go away. but will his presence and voice be missed? you bet. i can probably take one more. yes, sir. >> [unintelligible] in discussions and town halls and here in d.c., there were comments about [unintelligible] has there been any headway or update on public option plans? and what is the plan for when congress returns about the public option or co-ops?

>> there are three bills out of house committees, all of which have a public option component. the senate proposal also has a public option. the president continues to believe, as i do, that in the marketplace, having a competitor to insurance companies is the best way to keep down costs and provide better consumer choice. whether or not there is another strategy that will provide competition like a co-op remains to be seen. no one has seen the draft language so it is impossible to weigh in on it. holding down costs, not just relying on insurance companies

to do the right thing, but actually providing cost competition to lower costs and provide consumer choice is essential. i think the best strategy that i have seen so far is definitely a sooption -- is definitely a public option to do that. but no one is backing away from the notion that we need cost control and we need competition in a new market. thank you very much. [applause] . >> as the debate over health care continues, c-span's healthcare have is a new resource. what's the latest events, including town hall meetings and share your thoughts on the issue with your own citizen video, including any video from

town halls to have been too. there is more. you can do to c-span.ward/health care. the number of so-called -- you can go to c-span.org/healthcare. the number of so-called declining banks has risen. the head of the fdic, sheila bair, made the announcement at a federal deposit insurance corp. forum in washington. this is about a half-hour. >> after the chairman's presentation, others will make short presentations and then we will take presents it -- then we will take questions. police said there are technical questions for this panel. -- please save your technical questions for this panel. >> thank you, andrew.

welcome, everyone. we have all seen the good news that has come out of the economy in the last two weeks. challenges remain. evidence is building that the economy is starting to grow again. no matter how challenging the environment, the fdic has ample resources. banking industry performance is a lagging indicator. the banking industry can also look to better days ahead. for now, the difficult process of recognizing losses and clean up balance sheets continues to be reflected in the industry's bottom line. insured institutions posted a $3.7 billion net loss in the second quarter. they earned $424 million in net

operating income. onetime losses and other losses totaling $1.1 billion pulled the overall results into negative territory. deteriorating loan quality is having the greatest impact on industry earnings as institutions continue to set aside reserves to cover loan losses. of all the major earnings components, the amount of that they added to reserves for loan losses by far is the largest to drag in the industry compared to a year ago. as you can see, they are higher than a year ago. they have set aside $67 billion to cover bad loans in the second quarter. there were also expenses

stemming from write-downs which increased extraordinary losses and higher deposit insurance premiums. the upward trend dates back to the second half of 2006. while the early losses were related to residential homes and complex mortgage-related assets, we are now seeing problems with more conventional types of retail and conventional loans -- retail and commercial loans. this shows how loss conditions have grown. in the second quarter, loss provisions were 10 times what they were three years ago. the obvious reason for this is the ongoing need to bolster reserves and the basic rising levels. these credit problems will outlast the recession by at least a couple of quarters. these are the number of loans

that had been written off each quarter. there's also the quarterly change of non-current loans remaining on banks' balance sheets. the church shows -- the chart shows that these levels are still rising. as you can see, the gap has been growing between the level of non-current loans and the industry's research. this widening gap is driving the high-loss provisions. the reason why we expect them to remain at elevated levels is this. not only the second quarter was bad. the increase was smaller then in the first quarter.

the volume of loans that were 30 days to 89 days past due crossed along major categories. we are going to need another quarter or two to confirm a trend. another positive during the quarter was the improvement in community banks as well as for larger institutions. this is good news for community banks. in many important respects, financial markets are returning to normal, combined with the positive economic news of a bit of recent weeks. -- combined with the positive economic news of recent weeks. the process is absolutely necessary in order to restore the industry's sustaineability. as banks continued to clean up

their balance sheets, more are coming on to the list. this shows the trend hitting a historic low in 2006 when bank profits were at record highs. although the number continues to increase, it is still well below the level seen in the last crisis. we expected the number of problem banks and failures will remain elevated, even as the economy begins to recover. problem banks and bank failures continue to be economic laggers. first, one thing you should know is that the balance [unintelligible]

just as banks set aside reserves for loan losses, we set aside reserves for anticipated bank failures. our counter reserves are available to observe losses -- two of sort losses. . to absorb -- to absorb losses. when colonial bank failed to weeks ago, there was no reduction in the fence because the estimated loss had already been reserved for we will review the adequacy of the reserves every quarter and make adjustments as warranted. we have been shifting large sums into the contest -- into the contingent loss reserve. our total reserves should be distinguished from the cash resources that are there to

protect depositors. our sources of liquidity to protect depositors include not only the $22 billion of cash and treasury securities, but also the ability to borrow up to $500 billion from the treasury department. a decline in the fund balance does not diminish our ability to insure depositors. the fdic was created specifically for times such as these. our resources are strong. your insured deposits are safe. and no insured depositor has lost a penny of insured deposits and no one ever will. thank you very much. i would be happy to take your questions now. >> with the bill that $10.4 billion, do you anticipate having to borrow money from the treasury? >> not at this time. i never say never, but not at this time.

>> are you charging an additional assessment? -- do expect to charge an additional special assessment in the third quarter? >> [unintelligible] the board will be deciding toward the end of the third quarter about whether we do that and with the amount will be. >> and do these numbers tell you at all that may be targets not working as quickly as the government would like to? do you feel that terps performance will show up on the road -- do you feel that our's performance will short down the road? -- do you feel that tarp's performance will show up down the road?

>> i think you have to look at what was targeted to see the effectiveness of eight. [unintelligible] >> madam chairman, regarding the removal management of the troubled banks, some of the problems that i have seen from these failures have been caused by bad management. the fdic has only been able to do it after the fact. do you see any way to do it in an early stage, even the too big to fail issues? colonial has been in problems months before you had to take over. >> right. there has been a supervisory history with colombian. -- with colonial.

we are seeing that supervisors are putting heightened emphasis on that. we do not want to start picking and choosing bad managers, but that is something that the board should do. we expect them to take their responsibility seriously. >> [unintelligible] >> ok, great. thank you for coming.

>> welcome. russ walter. i just have a couple of brief remarks to empathize some of the transit the chairman had identified in her presentation. after that, i will turn the microphone over to our chief economist who has some observation about the economic trends. then our next panelist will speak on quality trends. then we will be open for questions. we also have diane feliz, the assistant director in our division who is here to answer questions you might have about the deposit insurance fund. i would like to take quick different look at one of the

charts. my version shows the quarterly dollar amounts of net operating value. that is the sum of the net interest income. you can see in this chart to the rise and the loan-loss provisions. this also shows the resilience of the industry's revenues during the economic downturn. i think the resilience is important because it underlines the ability to have cash flow even in a severe recession. a larger share of these shares will make it to the industry's bottom-line profits. it should be noted additionally that revenues have been more resilient at larger institutions because they have greater diversification and more sources

of revenue. revenues at community banks and institutions with less than $1 billion of assets have experienced some erosion in this recession. community banks have also been less successful in controlling their overhead expenses compared to larger institutions. but the overall, they have had smaller loss provisions. loss provisions are the main factor affecting earnings performance. we do expect industry provisions to remain in the near future. it is important to not lose sight of some of the industry's underlying strength. >> one of the themes of today's report is the time lapse and what happens with the economy and what happens in the bank and thrift industries. this cycle has been unique in many ways. there was a big downturn in housing and mortgage credit that led us into the recession at the

end of 2007 and the financial market disruptions last fall that significantly affected it. it appears now that [unintelligible] through the downturn, lenders have been reluctant to lend as they try to clean up their balance sheets and borrowers have been reluctant to borrow as the cut back on their spending. this is the total loans and leases that declined by 1.4% during the second quarter. this is the fourth consecutive quarter of decline. how long it will persist is hard to say. as you see, the 1991 -- the 1990-1991 recession, we saw a hint of consecutive quarters of decline. after the 2001 recession, loan balances fell slightly in only one quarter. credit problems in this downturn

are more reminiscent of the situation in 1990-1991. capital ratios were higher now than they were then. meanwhile, capital activity remains extremely important to the credit situation for businesses and consumers. corporate bond issues this year has reached $1.10 trillion as firms gone -- as firms have gone directly to the market. as we have discussed in previous briefings, a private residential mortgage-backed issuance is in great need of repair. commercial-mortgage -- commercial mortgage-backed issuance is also in decline. originations grew up in the first half of this year compared to 2008. banks and thrifts [unintelligible]

i am going florida's the economy begins to -- in going forward, as the economy begins to recover, their confidence improves. there is the general expectation that a greater portion of total credit market intermediation will take place in the balance sheets of banks and thrifts then we have seen through much of this decade. that will provide opportunities for asset growth on all sides of the institutions. don is the associate director of the fdic division of supervision and consumer protection. >> thank you very much. good morning. as has already been communicated, [unintelligible] deteriorating asset quality has an impact on earnings and capital levels remain the most significant supervisory concern. starting with construction and

development portfolio, we are seeing significant deterioration. net charge-offs are up dramatically from the first quarter. despite that level and an over 40% decline in outstanding balances from a year ago, -- and it over 14% decline in outstanding balances from a year ago, the continue to rise. the total past due and non- current loans increased at a slower rate than in the prior two quarters. performance remains much worse and larger institutions. other consumer portfolios continue to experience an increase in loss rates. [unintelligible] performance is dependent on the strength in the economy. over the last few quarters, we identified commercial and industrial form portfolios.

cni non-current and charge of levels continue with a rapid acceleration. deterioration is more pronounced in larger institutions, but it is still noted across the industry. given the nature, the deterioration -- given the lag in nature, the deterioration is there. guest[unintelligible] further deterioration with these portfolios is occurring as anticipating. these are provisions expenses that increase in the quarter. the resulted in a continued

decline in loan loss coverage. the adequacy of institutions with a balanced remains a supervisory party. the number of institutions increased by a number -- increased to 416. we expect the deterioration in credit quality to add to the number of problem institutions and failures. with that, we can take your questions. >> the $4.80 trillion in deposits, that is the [unintelligible] >> exactly. >> [unintelligible] >> the unlimited guarantee? the transaction account?

the transaction accounts to guarantee ads about another $700 billion. those are deposits that are in non-transaction accounts. while we do not have precise numbers yet on the amount that the temporary increase to 250 will cause, i think we have estimated another 15% in insured deposits. >> that is another $600 billion. >> $600 billion or $700 billion. >> yes. >> can you give -- you have -- do you have a revised figure for the losses in the next five years? >> we have not made that revision. we have not updated those numbers yet. we are in the process of doing that now based upon this data.

but we will be doing that for the board in the near term. i do not have a number yet. >> m.i.a. understanding that a portion of it is in cash and a portion of -- am i understanding that a portion of it is in cash and a portion of it isn't another form? >> it is a lot rot -- is in and other forms? -- is in another form? >> we are reducing the debt the balance by the amount of losses we expect to occur over one year. there is no cash impact on any assets. it is a liability on the deposit insurance funds bells she appeared >> on the assets side, what are you holding in addition to cash on the asset side? >> sure.

there is about $22 billion in cash equivalents. the others are largely receiverships', failed bank assets. >> [unintelligible] >> no. the contingent loss reserve is what we expect to lose in the future. it is what we expect to incur in the way of bank losses due to bank failures in the future. when the other assets represent the essence of that we acquire from failures that have already occurred, -- represent the assets that we acquire from failures that have already occurred. >> you have $10.4 billion that you have collected and are ready to spend on fill the institutions. then you have another $32

billion that you are prepared to stand. >> no. $10.4 billion is the fund balance. you can consider that the net worth. it is the difference between the assets held in the fund verses the liabilities. that difference is $10.4 billion. you might think of it as the network of the fund. the assets, $64 billion, there are actual liabilities that we owe of $22 billion. we have established another liability of contingent loss reserves of 30 two billion dollars. that is expected loss amount. without that contingent loss reserve, the balance would be $42 billion.

but we have established a reserve for losses we expect in the future of $32 billion. >> [unintelligible] >> again, it is unanticipated loss. right now, it is being funded by the assets you see on the left side of the chart. in terms of where we would find the funds for the future bank failures, that comes from cash and cash equivalents. that is why liquidity is an important but very different concept from the fund balance. >> it is important to

distinguish the liability side of the fund and the asset side of the fund. losses that are expected in the near term, those are contingent loss reserves. the financial resources that the fdic has at its disposal are on the asset side of the balance sheet. ucd $21.6 billion in cash. -- you see the $21.6 billion in cash. assets also come in through assessments. those resources can be bolstered if needed through our borrowing authority. that is indicated in the chart as well. >> [unintelligible] >> no. >> we are trying to get specific examples of what the assets are. >> they are specifically excluded from the cash balances.

these are the cash balances remitted to the deposit insurance fund itself. -- these are the cash balances related to the deposit insurance fund itself. >> [unintelligible] >> the assessments are what we have previously collected. that is how we have generated revenue in the past. the point we're trying to make with this chart is that we have $42 billion in resources available to cover future bank failures. >> [unintelligible] >> that is right. we have $22 million in cash right now -- we have $22 billion in cash right now that we would pay out, right. >> [unintelligible] >> the other resources are omore illiquid assets. if we weren't too use all of the

20 -- if we were in to use all of the $22 billion, we could borrow to get cash for future bank failures. >> [unintelligible] >> yes, we are counting that as part of our assets. we are counting assets that we have acquired from failed banks on our balance sheet. they are assets. we will receive cash for those in the future. we will collect on those assets in the future. they're not cash today, though. >> [unintelligible] >> right. do not look at the $22 billion as a static number. all the time, assessments come in. assets are liquidated. we have other sources to build

that cash number as well. >> we do break out the factors of changes in the number in the quarterly bank #. we show with the assessment revenues have been over time, interest on our investment securities, and other things. >> when was the last time -- when was the last time that the fund balance was as low as $10.4 billion? >> i think it was early 1993 -- march 1993, i think. >> can you discuss whether we are near or at a peak in terms of delinquencies for commercial real estate? >> on the commercial real

estate, something that was mentioned earlier is that there is a laggin in time. we expect commercial real-estate to continue to deteriorate over the next several quarters. the degree to which it deteriorates will be dependent on a lot of factors. some will be bank specific and some will be economy related. overall, there will be a lag in the timing. we expect to see more deterioration. >> there are two phases. being construction lote -- the construction loans and the land loves -loans, people are concerd about the income-producing properties. financing is difficult. the loss of 6.7 million jobs in the recession has cut to the occupancy in some of those

office projects. i think there is distress there that we will see in the next couple of quarters. >> there will be changes in january 2010. since you already have these hard-to-value of assets, how're you doing your mark-to-market valuations at this point? >> are you talking about the fdic assets or the bank assets? >> [unintelligible] >> let me clarify one more time did are you talking about the way we have the supervisory authority? >> [unintelligible] 8 makes a big difference on how much available cash for money you have. -- it makes a big difference on how much available cash or money have appeared >> right.

we acquire assets from the failed bank. we've marked them to market at that time. periodically, we review them. >> no different than a bank, we have to revalue them with accounting principles. >> they will be changing. >> some of the assets will be changing. >> what are the conditions that [unintelligible] is there a number that you are looking at. at -- looking at? .

>> it would be an expansion of the balance sheet on both sides. >> [unintelligible] >> in the other questions? >> thank you very much.

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>> on tomorrow morning's washington journal," we will continue our conversation with bruce vladeck and tom scully. later in the program, maddy aide on his book about the national security agency -- matthew aid. washington journal begins at 7:00 a.m. with your calls. senator kennedy's body will continue to lie in repose at the john f. kennedy library in boston. i will have live coverage starting at 8:00 a.m. eastern on c-span2. tomorrow morning there will be a memorial service at 7:00 eastern. watch live coverage on c-span.

>> as washington and the nation continue the focus on health care, sunday on c-span, we will talk of a dealing with the h1n1 swine flu virus with dr. thomas frieden, director of the centers for disease control. on "q&a" a look inside the u.s. hospital system with dr. john garrett. the federal communications commission voted unanimously to launch three separate inquiries into the wireless industry. this portion of the hearing examiner's truth in billing rules, which require communications companies to clearly identify and describe charges on consumers' bills. we will hear first from the chairman of the fcc. this is about 20 minutes. >> madame secretary, if you could announce the next item on the agenda please.

>> thank you for working on this important notice. but today the consumer and government affairs bureau presents to you a notice of inquiry on consumer information and disclosure in an effort to ensure that american consumers have access to information they need with our communication services. i want to thank step as well as all the bureau's and ochses to have collaborated with us on this item, including the wireline competition bureau, wireless telecommunications bureau, and others. with me are the chief of our policy division and an attorney and our policy division. lisa will prevent -- present the items.

>> as kathy stated, this item examines how communications customers choose providers, plans, manage their use of communications services, and decide when to switch providers are plans. accurate and understandable information plays a central in maintaining a well functioning marketplace and encourages competition, low prices, and high-quality services. the commission concentrated its efforts on making telephone bills more consumer friendly, by being brief, anonymously, and in plain language. 2005 the requirement was extended to wireless phones. it did not expand its inquiry beyond its primary focus. since these initial inquiries were made, there have been significant changes in the market, including the

introduction of many new services and products. in addition, the use of the services by consumers has increased substantially. one example is the use of mobile phones by consumers. since 1999, the number of mobile telephone subscribers has grown from 86 million to 270 million in 2008. in addition, american consumers use and spend much more today on their television, television, -- telephone, an internet services. annual household expenditures rose from 1000 400 $38 -- $1438 in just five short years. this has created new sources of consumer confusion. a recent survey by the government accountability office found that one-third of wireless customers to pay their own bills down unexpected charges or

had problems understanding their bills. one in by customers to contact the customer service were dissatisfied with their carrier efforts to resolve the problem. the federal trade commission found consumer confusion regarding operas for free internet services, which end up being high-cost, long-term obligations. primarily because restrictions and conditions on these operas are not disclose clearly are conspicuously. a recent survey reveals that while consumers are generally satisfied with the services, there is a high incidence of complaints about billing, support, and fees with respect to bundle services. in fact, this trend is reflected in the number of complaints filed with the commission as well. as you can see in this next slide, in the cable, satellite, wireline and wireless service areas, consumer submitted approximately 47% more complaints to the commission in 2008 than in 2007.

this illustrates why this inquiry is so important and we must are looking at these issues today. to that end, the item before you cease, and on the kinds of information that will be most useful to consumers at each stage of the process. choosing a provider, choosing a service plan, managing use of the service plan, and deciding whether and when to switch providers and plans. first, we seek to better understand a variety of factors consumers consider when assessing providers of communication services. how important this information is about provider service plans, quality of equipment. the item 6 comment on what information consumers need when choosing a service plan or pay an option and what point of sale disclosures consumers receive, particularly when several services are bundle. third, we see, and on the information consumers need to manage the use of the service plans they have chosen. for example, do consumers receive information on usage,

the potential for overcharges, or how to detect unauthorized charges? our address charges easily detected, and how difficult is it for consumers to get such charges removed from their bills? finally, the item 6 input on the extent to which consumers have access to sufficient and timely and permission to compare the price and quality against other alternatives in the marketplace. how do consumers estimate and evaluate the practical and financial costs of switching providers as compared to the tissue gains from adopting a different plan or provider? what tools are available to consumers to help the monitor and evaluate alternative plans? the item 6 data from communication service providers, academic researchers and third- party analyst they can shed light on the general state of consumer where it -- awareness of each stage of communication services and opportunities to improve consumer welfare. the item six, on whether

consumer intermission and disclosure rules should apply to service providers beyond traditional wireline and wireless service. the item nuts examples of disclosure requirements that govern other industries -- items such examples. the energy guide program, requirements for fuel economy labelling in cars, department of transportation requirements for labeling of safety ratings, and mortgage information disclosures. the item 6 comment on whether similar disclosure requirements for communication services might assist consumers in understanding their bills. it seeks input on technological tools that may be harnessed to empower customers and easier for them to access and analyze

information about communications services. we also see comment on all of these issues as they relate to people with disabilities, including accessibility of disclosure and billing information. finally, the item seeks information on consumer permission measures to ensure that consumers are where protections afforded by the truth and billing rules and how they can file its formal complaints with the commission regarding billing issues. the bureau recommends an adoption of the item present and request editorial privileges. the key for the opportunity to present this item to you today. >> i remain in self-imposed silence, but i do report that it takes a personal toll on me. i would ask that my previous statement be incorporated. i would just remark that may be the most telling chart that you have there was a number of consumer complaints going up

over 40% in a year's time. that shows how much work we have to do. >> i am not used to going so quickly. thank you to the whole team there for all your hard work. i am delighted to approve today's order. it has been for years since the commission last examine consumer information and disclosure matters. in the intervening years, there has been significant growth and change in the communications marketplace, including the introduction of new categories of service as well as new pricing models. certainly, these advances have benefited consumers in many ways. more choice and lower prices immediately come to mind. there's some evidence that this change has created new areas of uncertainty. given the circumstances, i appreciate the desire to take another look. as we move forward, it is

critical that we keep in mind the commission's limitations here. for this reason, i think the chairman and my colleagues for supporting my suggestion that we include robust discussions of the commission's statutory authority and the applicability of the first amendment as well as the longstanding precedents in this area. i would like to believe that we strengthen the item with a more sound legal footing and have provided a more meaningful opportunity for comment from all. again, many thanks to the chairman for his leadership, and i look forward to hearing more about these issues. >> today's notice reflects a fundamental tenet of an effective marketplace where consumers have meaningful access to information when making choices among providers and varied service plans. there -- therefore more likely to make the best choice.

and consumers are making informed choices, providers are driven to be innovative and to offer more desirable services. consumers purchase the services and everybody wins. however, where consumers are locked into long-term plans and never anticipated, experience unforeseen failures in service covered, or routinely and unknowingly pay for services they never envisioned using, the market place has gone askew. when that occurs, the public interest requires that we a different problem, fully comprehended sources and scope, -- we identify the problem and then address it head on. to consumers of communication services and devices have mental agnes to central information throughout and beyond the purchasing process? if not, where the most effective means to correct any systemic breakdown? to answer this and related questions, we not only need

information directly from consumers and groups that represent their interests, but from industry as well. some of the best day in this area are in the hands of communications service provider. many of them have developed impressive customer service operations that collect and track the kinds of information that could assist this commission with this quest to get a handle on the state of the marketplace. without it, we run the risk of developing solutions that are sub optimal for both consumers and industry. moreover, industry can provide the commission with potential solutions to consumer confusion by sharing its own best practices. it would be helpful to understand how various companies and organizations have addressed any known information deficits and what each approach has yielded. i am particularly eager to learn more about the experience of groups like ctia, which as

promulgated a consumer code towards ensuring accurate information is provided to consumers by its members. is a self regulation truly effective in this context? had we know? would it be superior to guidance from rules promulgated by the federal government, developed in concert with industry and consumers alike? with robust industry participation, this proceeding can yield truly positive and long-lasting results. we also see got in front academics who are experts in the field of informational and behavioral -- we also seek guidance from academics. we have our own perceptions about how consumers process information and what prescriptions would offer to remedy any perceived deficits, but for us to make enlightened judgments about what information consumers required to make sound

decisions, and in what form that information should appear, it is paramount that we have input from experts who have studied these matters with rigor. finally, i applaud the chairman and the consumer and governmental affairs bureau for actively seeking input on what the commission itself can do to better educate consumers. the commission must not only play an active role and on growing role in this process, but be a leader in the business of protecting and empowering consumers. thank you again to the chairman and to the bureau for this timely notice, which has my full support. >> promoting consumer interest is one of the most important priorities that congress has given us as a commission, and i take this responsibility very seriously. i am pleased to support this item. i want to congratulate the staff

at the bureau for their very fine work on this notice. with this notice, we launch an inquiry that is brought to gather evidence to determine whether consumers of communication services have the information they need and whether providers disclose the information that they should in today's marketplace. although the commission has addressed truth and billing issues in the past, the proceeding we launched today will rightfully take a fresh look at consumer information and disclosure issues in a comprehensive approach. information empowers consumers to make informed choices about products and services at all stages of the consumer experience, from choosing a provider to deciding when and whether to switch to a new provider or serviced land. i am encouraged that the item recognizes the industry's voluntary efforts to address consumer demands for more and better information about products and services. i am also pleased that includes questions about whether our existing rules continue to make sense in the current marketplace.

i hope for a broad and subsidy participation in the proceedings of the will have a solid record on which to build a complete and accurate understanding of the market. it is important that we avoid regulating where the marketplace is actively responding to consumers' concerns. all regulation, a matter how well-intentioned, imposes costs. especially at a time when our nation faces significant economic challenges. we haven't -- a responsibility to weigh the benefits of any proposed regulation against the cost, as well as considering unintended consequences of our actions. this is especially important when considering consumer protection regulations. at her confirmation hearing, the senator said that when we impose regulations, somebody pays for that. if you do not strike the right balance, you hammer the little guy. i agree. as regulators, if we do not strike the right balance, we risk imposing costs and other regulatory burdens on providers

that can in turn raise prices, reduced quality of service, and harm innovation. these results, although unintended, may harm consumer welfare as much as the consumer and frilly practices are in singed -- our decisions are intended to prevent. government should proceed with caution to ensure the best outcome for consumers. i recognize this notice only initiate an inquiry that will not lead directly to new regulatory obligations. although i would be particularly mindful of the balance of benefits and costs as we move forward with the commission's agenda, i fully support this effort to gather act based evidence on which it can buy with the current state of the marketplace. i see this inquiry as fundamental to our role as the expert agency and our responsibility to promote consumer welfare. consumers are counting on us. with those thoughts in mind, i look forward to working in a renewed spirit of cooperation with congress, the chairman, my fellow commissioners, staff,

consumers and industry in the days and months ahead. >> protecting an empowering american consumers is one of the commission's most important responsibilities. a very much appreciate the work of the consumer and government affairs bureau with this item. hard work with excellent results. you have helped advance today the commission's efforts to ensure that consumers have access the information they need. the task of protecting an empowering consumers is the responsibility not only of the consumer bureau but of every single bureau and office at the commission. every decision this commission makes, big and small, affect the day-to-day lives of american consumers. each of us who had the privilege to work at this institution is responsible for ensuring that our agency's decisions are always in the interest of consumers of communications

services. today's notice address is the protection and empowerment of american consumers, specifically we seek to ensure that consumers have the information they need to make the market work. i cannot think of a more important moment to be considering these issues, despite signs of stabilization in the economy. times are still very tough. many americans are line to be it is to do more with less. a surprise starter on a monthly bill or a new service that does not perform as advertised can be a real budget buster, especially as household spending on communications rose ever larger. today's notice and the process the launches will help the commission build a record on ways to ensure the consumers understand what they are signing up for. let's face it, as we heard, the communications marketplace is a very confusing place today. technology has brought us a lot of new choices, but can also lead to confusion about how to evaluate new options coming on the market. the good news is that technology

can also help in very significant ways. it can give consumers access to new information and present old information in new and better ways. the inquiry provides the agency with an opportunity to understand that information and technology are part of the solution and comes to finding ways to protect and empower consumers. i was pleased to hear in the presentation the desire to consult with other agencies and understand across government what has worked and to see what is appropriate and analogous for work. i look for to seeing the results of the notice. before we tore final vote for today, i want to take a moment to thank my colleagues and their staffs for working well together on these items in a series of ways that are important parts of the commission's mission. with that, unless there is more discussion, we will proceed to a

vote. the ayes have it. so ordered, editorial privileges are granted. that is the last of the items of which will take a vote. but senator kennedy's body continues to lie in repose at the john f. kennedy library in boston. we will have live coverage starting at 8:00 p.m. eastern on c-span2. tomorrow evening, there will be a memorial service at the kennedy library at 7:00 eastern. watch live coverage on c-span. the casket was driven from hyannis port, massachusetts to the jfk library today. next, we'll see members of the kennedy family leave the family compound in hyannis port.

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[no audio] >> senator kennedy's body will continue to lie in repose at the john f. kennedy library in boston. we will have live coverage starting at 8:00 p.m. eastern on c-span2. tomorrow evening, there will be a memorial service at the kennedy library at 7:00 eastern. watch live coverage on c-span. the funeral mass will be held at our lady of perpetual help basilica in boston on saturday morning. live coverage at 10:30.

later in the day, at 5:30 eastern, senator kennedy will be buried at arlington national cemetery in virginia. both of his brothers are buried there. watch live coverage on c-span. but some go inside the supreme court to see the public places and those rarely seen spaces. hear directly from the justices as they provide their insight about the court and the building. the supreme court, home to america's highest court. the first sunday in october on c-span. >> now a discussion on the 2008 presidential race. this portion of "washington journal is about an hour. dan balz, haynes johnson with his book "battle for america 2008." let me begin with the cover of the book. it includes tina fey and jon

stewart. what does that tell us? guest: they're not candidates, but played a big role. they are cultural icons. rah palin became a big item and there was an enormous impact on young people. they were part of this political cast. an incredible cast that we try to capture a. host: will go through some moments of the campaign. let me get to the final chapter with an interview with obama. guest: it was december 16, 2008 at his transition office in chicago, the federal building downtown. it was the day we learned later that he had a meeting with the economic team where he was told that the sky is falling. they later learned it was even worse than they thought. that was the day that the world

grew quite dark for him in terms of the economy. it was a 40-minute interview before that. he was in a very upbeat mood, open, revealing, and awful about the campaign. [laughter] he sat down. he drinks bottled tea. he had been of the morning with arne, his designee to be the secretary of education, and vice president joe biden. he started just munching on these almonds. at one point you could hear him on the tape of the interview when you listen to a kind of rubbing the salt off his hands. and he apologized for being famished. host: in the interview you talk about big and small government, and he said he is more effective and whether we have "a smn effective government."

guest: he is still struggling about how to put that into place. given the additiambition he weno do in light of problems, one of the things he said he did not think e election brought an end to all of reaganism. he did not think there would now be an era of big government. he thought there would be less of a knee-jerk reaction, but the challenge for him and his administration would be how the show strong, effective, smart government? that is the test and i think that is still his test. guest: talk about that interview -- it was the most remarkable thing. he talks in the way i do remember any president -- full, historical context, modest, but also very deeply about the problems. he does not claim that he will

solve them. he wanted to learn the lessons of leadership. that is what he was all about, trying to bring together the country if he could. he recognized that the conservative era was still there. i hope that people will look back and i think they will on it. i think it will lease look that to say there was obama as he was about to enter the white house and here he is facing these problems. guest: at the end of the interview he talked about lincoln. the question put to him was, lincoln has been a touchstone for you in the campaign. he announced his candidacy at the old statehouse in springfield, ill.. his blast train trip was a repeat of what lincoln had done in philadelphia down to washington. "in what ways does lincoln and loan issue is our -- does the ln

influenced you?" he went on to talk about lincoln and the style of leadership he employed. basically he said, some presidents then othepresident bo there will -- lincoln was not like that. he said you have your view and i have mine, somewhere out there is the truth. through listening and guidance you can try to get people to that point. he said i have not gotten to that in terms of my own style of leadership, but that is the model i look to. guest: the problem is, can he bring people together? host: we will take the audience to some of the points that you outlined in your book. we will get to calls, also. guest: he was an ambitious man from the beginning. he wanted to be president.

he was not sure whether he would run in 2006, but was looking at. his strategist wrote him a remarkable memo saying you will never be hotter than you are now. it cannot wait too long. but he was also warned in the same memo, saying i worry about whether you can take a punch. you do not like criticism. are you up to the rigors of the campaign? i think people will study the memo for years to come and get it set the stage of why he should run. the time was right, the country was right. he was a new generation. but also, could you take the stresses, was the up to it? was his own character such that he could sustain it? -- was he up to it? host: here is a speech from when

he and senator enter the race. >> at the old state capital where lincoln once called on the house divided to stand together for common hopes and dreams -- where, hopes and dreams to live, i stand before you today to announce my candidacy for president of united states of america. [applause] host: you were there. guest: i was there and it was so cold. that is the first thing everyone remembers. a cold saturday morning. i remembered that setting. the second thing a remember -- we got there early, all the press, and were inside a building for about an hour. as we arrived one of the things that struck us was the size of the crowd. you could see the crowd building. it was 5 degrees. people had come from hundreds of

miles away. people have come from kansas city, missouri, downstate in illinois, the chicago area. their sense was that they were witnessing a moment in history. no one knew whether it would be a successful campaign, are not. but there was an aura around barack obama the day that everyone recognized. caller: good morning. the reason barack obama is president is because the republicans were caucusing to kill the clintons off the top of the ticket. they never did like the clintons. whoever was put on top of the democratic ticket would be president simply because they were tired of george bush and the deception. guest: i think he is right that

the country wanted change and obama became president because he understood better than any of the candidates how hungry america was for something different. change is the oldest cliche in american politics, but he captured where the country was. the politics were so riven with the scent and hatred. he says we can do better than that. -- with dissent and hatred -- and obama's of we can do better than that. host: tickets back to the summer with john mccain where he holds an effort to win the candidacy. he won new hampshire. guest: the characters are so fascinated me go he was the preeminent guy of the republican

party. then his campaign collapsed and he had to fire people. he goes to new hampshire. the crowd are angry and booing him. he cannot handle it well. his family asked, will be the republican nominee? he said may be, and who knows. then he goes out and he was written off as the republican nominee. the next time he is traveling alone with only one of aide, on a commercial flight. his ability to return to new hampshire is extraordinary. it is not remembered much now in retrospect host: you write that mitt romney came out of central casting in terms of presidential timbre. guest: yes, i don't think and look more like a president of an romney with his dubuffets, great

family, a lovely wife, a great kids, remarkably effective business leader, having turned around the winter olympics in utah -- and get there was this question about him because he is mormon. would the republican party dominated by evangelicals christians ever alleged a mormon as its nominee? he struggled with out throughout. this was something they knew was a problem, yet they did not know how to or whether to address it. he ultimately did in december 2007 in a speech in texas. but the point i think it was too late to deal with it. it is a question that will continue to follow him as he looks toward another run in 2012. host: tenn., next. good morning, anne.

caller: i think you who campaigned for a nominee to get over it and look what he's doing too american. his stimulus package is the worst thing he could do. you look at the self-proclaimed communist, marxist radical he is. they are trying to take down free-speech. the people need to pay attention. he is a man that has never been proud of america. in his book he surrounded himself with the most radical communists. his attorney general is not going to prosecute the black panthers to threaten white voters. host: how do you respond to that? guest: i disagree that he surrounded himself with

communists and radicals. there is no evidence of that. certainly there are differences of opinion about the agenda he is pushing. there are many people, goods are republicans especially, who think it is way too much government. in some ways some of what he has done is an extension of what george w. bush was doing. the bank bailouts were started under the bush administration and everyone agreed with the stimulus package. there arare disagreements about the size and composition, but there's no question that the combination of dealing with issues he inherited and pushing a big agenda has put forward the idea that there is a lot more government in people's lives in this administration, more than people anticipated. host: he brought in his poll ratings and to the debate this summer. guest: yes, i'm glad that woman said what she had to say

because reflects that there is a deep anger in the country. the attacks on obama are extreme. the question will be whether he can overcome that. the question is whether that is the majority. host: we will go to matt in lancaster, pa. caller: in classified as an independent and i left the republican party because they are in my view no other conservative. -- no longer conservative. i will not even get into my concern with the democratic party, but my concern is that we have left a constitutional form of government and have been for a long time. is there any way possible to eventually return to that and eliminate allhese un constitutional laws that we have in place? we have many laws that do not

stick with in the free market. this health-care bill is beyond the pale. i have been tried to understand why we abandoned the constitution. if you guys could help me to understand, i would be most grateful. host: even when president bush was in the white house it drew the ire of democrats. guest: here is the congress across the street. they pass laws illegally. that is the constitutional system we have. we elect representatives and senators, and debate, decide who will be present. we have checks and balances and out of that, a series of laws. you may not like them, but whether or not they are unconstitutional is something entirely else.

the laws are passed illegally. you can take it to the supreme court if they're not constitutional, but they have not yet been rendered that way. host: from a book in the campaign, a speech obama delivered in 2007 at the auditorium in iowa. set the stage. guest: this was the turnaround on it for barack obama in fall 2007. one of the things not so well understood in retrospect is that he had a very difficult start up period. each of the great moment of the announcement with a lot of energy. after that, he was not particularly effective as a candidate. he did call himself a slow starter. there's a wonderful moment in late spring 2007 where robert gibbs flies to iowa with obama. the staff is word because they know that obama is down, and

happy with the campaign, and happy with himself. gibbs had the kind of relationship with obama that they could talk openly and freely. he knew he could get obama to vent. he basically said to obama that day, look, we know you are unhappy and everything is not perfect, but just find something positive about the campaign and focus on that. do not worry about everything else. obama's said, frankly, there's nothing i feel positive about right now richard obama said. the other person in the room is reggie love, his personal assistant with whom he played basketball act duke. reggie is working as blackberry at that time and he said boss, if it is any consolation, i'm having the time of my life. obama looks at him giving him a

withering look, and says well, reggie, it is not any consolation. fast forward to fall 2007 when hillary clinton is running 30 points ahead of obama in some national polls, way ahead in new hampshire. obama is struggling with his message and there is a debate of how hard to go after her, how sharply to draw a contrast. at this moment is when obama is beginning to turn around his message. they put all their efforts toward the jefferson/jackson dinner in des moines. host: from november 10, 2007. >> it is because of these failures that america is listening intently to what we say here today. not just democrats, the

republicans and independents who have lost trust in their government but one to believe again. it is because of these failures that we not only have a moment of great challenge, but also of great opportunity. we have a chance to bring the country together in a new majority that finally tackle problems that george bush made far worse, but that had festered long before george bush ever took office, problems that we talked about year after year after year after year. and that is why the same old washington text of the campaigns just want to do in this election. [applause] host: haynes johnson, what was

going on in the room. guest: they had packed the house with both hillary and obama supporters and you do not see that on that clip. the hillary people or older. they finally began to leave. the hillary people were outraged. bring them back, hold the doors. but that was part of the campaign problems. host: the next call is from iowa, ames. caller: morning, -- good morning, there's something about the constitution that i want to respond to been a first off, i do not rely on the supreme court to rely on what the constitution tells me. i read it myself and that makes me a citizen. almost nothing the u.s. does is legal. the constitution is very explicit. allow me, something the irks me

is something he said about holding back -- it is the s cam that romney put out. he campaigned as a conservative, family guy. the guy is a liar. he gave money to planned parenthood, told boys scouts they should have gay scout leaders. he bankrupt massachusetts and signed into law a healthcare plan with $50 co-pay for abortion. what did rush limbaugh and others from fox news let this guy go by? why did christian leadership endorsed this guy? guest: it is a great country. you can say anything you want if you do not believe in the laws. the supreme court does not tell me what to do, i believe in it, it is not legal. fine, make a choice.

run for yourself, become president -- we will debated. that is part of the backdrop, anger and frustration that people have, that is the backdrop for the next campaign. host: here, a reporter spending new year's eve in iowa. the following tuesday was in new hampshire. it was an extraordinary five-day window that shaped the race. guest: no question, that was one the most intense periods in the campaign. january 3, barack obama wins iowa, and it easily in the three-way race. host: what about john edwards? what if he had guest: won iowa it is one of the great if's. even if john edwards had one eye when he could not have been the nominee -- even if he hadwon iowa. if obama one had finished

third in iowa i think his chances would have been damaged. but we will never. never -- we will never know. the clinton campaign thought they might lose iowa, as it was always her most difficult state, but they're not prepared to finish third. they have a long meeting that night in the hotel suite. there is alet me begin with thef the book. it includes tina fey andlet me f the book. it includes tina fey andnew hame and arrive. it is only two degrees. she wakes up and there is the daily conference call on the clinton campaign. her top advisers -- she is again looking for advice -- her

advisers are tongue tied. someone on the call said that it was negligence on the part of the campaign. they did not have answers in the plan for her. essentially, from bad day forward through the rest of the new hampshire primary, hillary and bill and the local campaign took the campaign on their shoulders and carried it to victory. obama's came on a wave of support out of iowa and or coasting. hillary became the real hillary at the moment, dogged, determined, more effective. she turned it around and was able to win. host: 1 moment, portsmouth, new hampshire -- what happened? did she cry, tear up? guest: she actually was losing,

her whole campaign was messed up, and she interviewed and talk about how difficult. @@@@@@c >> she did not cry, but she tears up. that went over the whole state and the country. she has lost it, she is taking, she is this in that. people, particularly women were very sympathetic to the image that they saw. they thought they saw for the first time in the crack from a i see hillary clinton, and human person, able to express her emotions in a way that was very powerful. the women in new hampshire came to her and supported her, and they had not been in the polls of to that point. . . they look on the internet

because it was available then. the campaign staff began to debate if it was real or not. obama's reaction was look, give her a break. this is tough. things happen. this is a verye hard process aase off her, guys. aase off her, guys. that moment happened two days after they had debated in new hampshire. that was the debate and which john edwards and obama essentially ganged up on hillary clinton. there was a question put to her from one reporter which was some people just do not think you're very likable. and she said well, that makes me feel bad. obama thinking he was been sympathetic, said helleri, you are likable enough. he told us later that he

realized it had come out badly. what was intended as a show of support and sympathy look like you're rude, and. i think that it played into what happened then in portsmouth. -- it cannot like are rude -- came out like a rude comment. guest: what if john edwards' affair had been reported? it turned out to be a backdrop. he was living with this lie whole time, but it never surfaced. host: we are joined from east chicago, indiana. caller: you are speaking on two levels. one on the issues they presented an the other on the human aspects. hillary clinton is a woman and barack obama as a minority, and

my question is, the obama brought to the campaign and under current, the voice of the people and what they were really looking for. frankly, he moved me many times in his speeches, but in real life and got into the office not only did he realize what the real president had to do, but he went with many of the choices that bush did prior to him. we can analyze effectively how these campaigns are run, but what the american people see is that it is just a bunch of rhetoric. host: the me take your question,

rosa. if obama had onwon new hampshire, it would have ended easily. did that help obama to have a long battle? guest: yes, i think it helped him. he became a stronger, more effective, tougher, and more resilient candidate because of the competition that hillary clinton provided. that is one. he began the campaign as a novice. he had very little experience. he had been in the senate for two years. he was not accustomed to the rigors of a presidential campaign. part of the process for president, like it or not, is a rigorous campaign. if you talk to him about it there's no question he thinks that he was helped in that thing

up that hillary clinton's competition made him more effective. the second factor is that that campaign had to organize every state in the country before it june 2008. they were worn out, no question. john mccain wrapped up his nomination earlier and had the luxury of thinking about a general alexian campaign. but the mccain campaign had not organized the states, did not know them politically as well -- about a general election campaign, they have the luxury to prepare. barack obama campaign was more prepared concerning the state. host: what was idaho symbolic of the obama strategy? guest: it demonstrated their brilliance in understanding the difference between caucus and primary states.

they had enormous volunteers and turned out enormous numbers of voters that showed he could win caucus states and did not even have to win primary state. it was incredible. political scientists will study the operation of the bombing campaign for years. the way that they use caucus states rather than primary states. host: charlotte, n.c., todd, go ahead, please. caller: hello, it is more of a comment then question. obama clearly has raised the bar and terms of running a campaign. he was brilliant and he had an incredible team put together.

more importantly than that, this message, he stayed on point. it drove home to many americans. i like for it to be pointed out -- fast forward to the present day, he took over the presidency. he has only been in there for six months. the conservative republicans -- i mean, they are just giving him the hardest way to go. they just want to dismiss the eight years of george bush. guest: it is a fascinating question. he is a republican caller. it captures the problems of campaign promises and performance as president. we began three years ago with this book. the idea that it would be the

most important collection perhaps in our lifetime because of all the problems, the war's committee,. what ever happened and would be a test not only of the political system but of us as a people and whether we can make changes. then you get obama coming forward and he does have a message in the campaign. now it is only six, seven months later and he is all the setting getting this battery. but it was true no matter who would be president rightow would have one of the most difficult times since franklin roosevelt in the depression. the collapse of the markets is not entirely solve. you have the wars, now afghanistan islam. people are talking about it being another vietnam. you have all this discontent in the country, health care. so, how obama comes out we cannot predict right now. but we do know that no matter

who was in the office it would be to. of host: john edwards, ted kennedy, john edwards, bill clinton -- and barack obama and ted kennedy -- can you eliminate the conversations? guest: this is one of the most fascinating chapters in the book, and one of the most fascinating episodes in the campaign. we knew there was something going on at the time. here was the situation. ted kennedy was looking for a candidate. he was drawn to barack obama for a number of reasons. obama had sought out his advice when he came into the senate and particularly when he thought of running in the fall 2006. senator kennedy said he should run now and the longer he stayed in the senate the more difficult it would be to be a national

candidate. ted kennedy also had good relationships with bill and hillary clinton, particularly with a build. there is a real admiration for one another. -- particularly in withbil bill clinton. he believe that hillary clinton was a very effective senator. he was torn. everyone wanted his endorsement. so, they began to try to lure him. the clintons and a bonus called, but particularly the clintons called. there was one day after iowa were they, generally, and it was cordial. but after the speech obama had given the night before, kennedy was very impressed am leaning towards obama. something was said in a conversation which we have not been able to unearth, something

that bill clinton said that deeply offended kennedy. that set off 10-12 days and which other things happen. that summit bill had deliberately or inadvertently injecting race into the campaign that kennedy bullyboys district. -- believed was destructive. kennedy urged him to get off of it. bill clinton was furious to b-2s that he was injecting race into the campaign. if you look at bill clinton's history, you can see that he has always tried to bring together the races, but ted kennedy was convinced that it was destructive.

he kept asking clinton to stop this topic and they even argue about the war and other things. ultimately, the clintons apparently concluded that hillary was not going to get the endorsement. then they tried to convince kennedy to stay neutral. in the end, kennedy decided he went to endorse obama. in the final scene of this episode, the day after the south carolina primary obama has won a huge victory after a nasty contest. it is beginning to leak that kennedy is endorsing obama. bill clinton calls and wants to know why. kennedy briefly explains. clinton hangs up and calls that minutes later -- i want to know exactly, give me details. as kennedy is on the phone he can hear bill clinton making

notes on exactly what he said. he was concerned at that time that the clinton campaign would cast it simply as racial politics on, kennedy's part. kennedy was concerned about that. both sides of a difference of opinion about what happened in those conversations. they're not wanting now especially in light of kennedy's to re-air this conversation. host: let's share the moment at the arena at american university in which kennedy endorsed a bomb. >> but i believe there is one candidate who has extraordinary gifts of leadership and character matched to the extraordinary demands of this moment in history.

he understands what dr. martin luther king jr. called the "the fierce urgency of now." [applause] he will be a president who refuses to be trapped in the patterns of the past. he is a leader who sees the world clearly without being cynical. he is a fighter who cares passionately about the causes he believe in without demonizing those who hold a different view. [applause] his tough-minded, but also has an uncommon capacity to appeal to the back angels of our nature. i'm proud to stand with him here

i'm proud to stand with him here today and offer my energy, my commitment, to make barack obama the next president of the united states. host: did this change the primary? guest: after this, there is no question that he would be the nominee. the happened is that the endorsement was so important is that it came on the eve of south carolina. after that, hillary clinton loses 11 straight contests. what it meant is that the liberals and the democratic party who supported john kennedy, robert kennedy, ted kennedy, they had passed the

torch to obama. not only that but it also meant that a great many african- americans started off being for hillary and they switched to obama. from ohio next. caller: good morning, i have a question. we can all agree that barack obama is candidacy was definitely transformation. it was my first predential election which was really exciting. it was exciting to see the youth on the campus more involved in national politics than before. i was wondering if some states in the general blushes, specifically virginia and north carolina -- obama under- performed in appalachia -- will it be something that we can see or more related to obama's

ability to turn now young and a minority voters? guest: we don't know the answer at this point, but clearly what has happened so far is that there is a demographic change in this country that is not working to the republicans' advantage. but whether that plays out in the issues now confronting the president -- will he be able to follow through to carry those states? i do not know the answer. what do you think, dan? guest: it is a great question and we will get a clue with a gubernatorial race in virginia. there are a couple of quick questions. was the 2008 campaign simply, moment in history, or was it the beginning of a different era?

the question obama was able to generate enormous enthusiasm, particularly among young people, african-americans, latinos. it is not clear that that is transferable to democratic candidates in 2012, or that obama will be able to re-kindle that in the second campaign for 2012. the states he mentioned along with some western states obama carried are the ones to look back. we will have to see how begins to play. guest: the democrats still have the advantage over republicans. so, we will see what happened. host: pam joins us from baltimore. caller: i was going to comment on something else, but i would

like to clarify in reference to the friction between ted kennedy and bill clinton. first of all, from the description your guests gave, ted kennedy was absolutely right. the african-american community was already in hillary clinton's hip pocket grandfathered from bill clinton because the black community loved bill clinton, but they patronize us. barack obama it did not assume our good. i do not believe that bill clinton is a racist, but he used it to perpetuate the difference between his wife and above. when i first saw barack obama before he ran for president i knew there was something different with him. he is a spiritually very motivated and inspiration.

even though the clinton had done some good things in our committee he had no right to assume we would back him no matter who was run. black people are not monolithic. we have had other black candidates. no one has been on the scene there brought anything near what barack obama abroad. another thing, what you seek in town halls today is motivated by hate and fear. those people do not even realize hannity and rush limbaugh, and special interests are using them. they will not even benefit from it. we're looking at democratic candidates and will not just vote for them because they are democrat. blue dogs are missing everything up. host: here is a message from twitter. let me use two of those points to return to a moment you,. -- to a moment you chronicle

from philadelphia in spring 2008. >> william faulkner once for the past is not dead and buried, and fact, is not even past. we do not need to recite the history of racial injustice in this country, but we need to remind ourselves that so many disparities that exist between the african-american committee and the larger american community today can be traced directly to inequalities passed on from an earlier generation who suffered undersal slavery ad jim crow. guest: it came about when abc unearthed the videos of jeremiah rwright.

very inflammatory. obama recognized this was a moment a breakperil for his candidacy. all the division is,rawness were suddenly laid bare. he had been running as oppose a- ratio candidate. he said to his staff as this, broke i need to give a speech about. they had talked earlier and there had never been the right moment. he said this is. it they asked john, and now chief speechwriter at the white house who was on the campaign to give a draft and he said this is way too personal and i need to speak with obama for. he had a long conversation with obama and then obama took over the draft and ready wrote it himself. he believed had he not handled

the moment effectively he would have lost the campaign. host: we're joined from louisiana on the republican line. caller: there is a andold cajun saying that my grandfather used to say -- "it makes me mad, ?" and that is what i would like to say now. because rick warren in the 2008 campaign inserted himself because he has an agenda. host: let me use that point because in the campaign obama was asked about abortion and he said that is above mypay grade and he got flak for that. guest: yes, obama tried to stay

away from hot button issues. no matter, obama will always be remembered. for all love our history of race relations, it is it allo -- all of hour history, that will be remembered. the emblem of 2008 is that the americans are really ready to turn the page and take a chance on an african-american kennedy. that is the real story. host: here is one of the moments from the vice-presidential campaign. >> nice to me. can i call your "joe?" guest: it is a wonderful clips

and captures sarah palin so marvelously. host: why did john mccain select sarah palin and what led to that announcement? guest: it is another great story. when they really had to make the decision, the leadership of the john mccain campaign believed given everything else happening there were on a trajectory to lose. the country was aligned because of problems and the unpopularity of george w. bush, because of what was beginning to happen with the economy that they needed to do something dramatic. if they ran the best campaign possible with the traditional approach they would lose. why sarah palin? in retrospect there are a couple

of reasons. one was the element of surprise, two but that she was a female when there were deeply concerned there were losing women voters. they thought there ought to be some way to bring back some clinton supporters who might be disaffected. the third reason was that they convinced themselves sarah palin could help john mccain put back on the jacket of being the reformer and a maverick. she ran as a reformer as governor. they thought it would send a signal that john mccain was the person to shake up washington and bring real change. they knew there was risk and were prepared to take. host: was there ever a moment

without the could win? guest: you know, i guess the two weeks after the republican convention when all of a sudden he was soaring in the polls, by mid-september he was ahead of obama. that was after sarah palin was nominated. then her interviews went down. then the economy began to crash. they knew they would lose and there comes sarah palin who energized the republican base. all of a sudden, the polls went up. by mid-september the economy is collapsing, her interviews were bad, and she goes down. host: tulsa, okla.. this book is called "battle for america 2008, the story of an extraordinary collection."

caller: mr. johnson, i read your book sleepwalking through the republicans kept invoking the name of ronald burke reagan. you expect the truth of the reagan administration, something like134 officials resigned over crimes and reagan sold weapons to terrorists. why'd you what this guy get away with it? guest: i am glad that you read the book and got the title right. we're not letting anyone get away with anything. ronald reagan remains a powerful factor. the question for obama's presidency is whether this will be the end of the reagan era. host: how did you two calabria?

guest: it is a wonderful story. we have worked together for many years at the post. haynes johnson called me and asked me to breakfast to talk about some. think i agreed and went home to say to my wife, well, haynes called and once to talk about something tomorrow. she said if it is about a book, just sayingyes. so, we went to breakfast and he did have a big book, a book about the campaign, state of the country, moment in history, a campaign of is there. but i told him it was really interesting because in two- thirds through a proposal of my own. -- a campaign of history. as a result, we decided to join forces. he had written 14 books and i had co-authored one.

had co-authored one. the division of labor, i was going to be on the campaign trail for two years. haynes was looking at the state of the country, the sense of historical sweep, tell us where we are in the sense of the great story of america. that was the way we did the reporting. each of us would do draft of a particular chapter and we would send it back and forth. you cannot have a book with two voices, it has to be one voice. guest: you sent to the e-mail back and forth, then you polish it up and then you come out with one voice. i think it did. host: let's go to our caller. caller: i have a question about

the later stages of the campaign and the vitriol that the mccain palin campaign seems to be turning up in their rallies. anythinanyone elected would face huge difficulties. do you really think that hillary clinton would be facing the kind of hatred and their real vicious things that we are seeing at these town hall meetings and given what was started late in the mccain campaign? guest: i think that she would have faced the same kind of problems. about communist, i do not know. but i do not know the answer. host: here at isa quote from the

viewer. guest: terrible moment for mccann. if he could take back those words -- i think that he thought he was saying something other than the way that it came out. it was a terrible moment. the obama campaign hurt. one of the staffers in the communications office went to others. the mccain high command heard it and flew down to florida. they knew this would cause a terrible problem. it sounded as though he was out of touch, lacked an understanding of what was happening in the economy and with average folks. it certainly did cost him. host: do you remember one moment in this book?

guest: the victory speech in chicago. it went beyond politics and swept across the country. whether democrat or republican, we made this change. it was a sense of hope. now we are polarized again. host: good morning, james, in florida. caller: yes, they had six or seven scandals in the campaign and there were only worried about sarah palin's order. there are four communists right there. lloyd once to stop this type of show. he wants to take a with a license because he will raise the price of the license and give it to the low. many times he said he hates the constitution, so how can you support anyone who hates it?

we had a constitution long before we had a president. guest: i never heard obama say he hates the constitution. he is a constitutional lawyer. if anything, he is pragmatic about the policies in our country. i just do not a. guest: one thing that is interesting -- i just do not agree. guest: we have heard from conservatives who feel this far to the left, and some say that he is the continuation of too many of the bush policies. he is trying to sort it out. guest: his promise was to bridge differences in the country. it is difficult. host: a lot of attention on the concession speech in which he said the hope will never die.

but there is another concession speech by hillary clinton you outlined in the butt. but lead to that moment in june, 2008 where he made reference to the cracks in the ceiling? guest: this was the final moment for hillary clinton as president and perhaps the end of her hopes of ever becoming president. the day of the last primaries in june she was under tremendous pressure to use that night to declare the race. over she resisted. -- to declare the race over. i have some sympathy. if you had run that kind of race, particularly in the final stretch, that she deserved on the night not to have to simply pack it in and say was a failed campaign. i think that she wanted to give her own supporters of one more moment to revel in

accomplishment. there was then a debate the next day about what to do. most of her advisers believe it, ok, she had to pack it in very quickly. her chief strategist thought she would suspend the campaign, but end it. they used the phrase, make obama grovel for her support" -- mark was in the minority in that view. hillary quickly came around and decided it was. * host: finally, your favorite moment from the book? guest: i cannot one. -- i cannot pick one. for all the candidates there are moment e oflation and moments of

deep depression. watching these candidates through the highs and lows, and following the end through-- one of the things about presidential politics in addition to telling us what americans think about themselves is that you see big characters under enormous stress, fighting for what they believein. we saw that in the case of all these main characters. it was one of the joys of covering it. host: "battle for america >> tomorrow, we will continue our conversation with the

former medicare and medicaid services administrator. later in the program, we will discuss the national security agency with an author of the a book about it. senator kennedy will continue to lie in repose in boston. you have live coverage. tomorrow evening, there will be a memorial service at the kennedy library at 7:00 a.m. east -- 7:00 p.m. eastern. >> how was c-span funded? >> grants. >> taxpayers. >> public television. >> i don't know where the money comes from. >> contributions from donors. >> american cable companies

created c-span as a public service. no government mandate, no government money. >> now, a health-care town hall meeting with don edwards of maryland. she is a member of the congressional progressive caucus. this took place in germantown, md. just outside of washington, d.c.. >> how is everyone this evening? [applause] >> excellent. i know some of you but i don't know all of you. it is wonderful to see people

who are interested and engage and excited to talk about health care reform. i have been having conversations about health care and health care reform for a couple of years across our congressional district. those have been very spirited. what i want to share with you this evening, we will have a chance to really talk about the substance. we will have a chance to have you ask some questions and i will do my best to try to be responsive to them.

the one thing that i would ask if you and i know that you can do it because you are from maryland, but i will ask you to be as respectful to me as i will be to you. i will ask you to be respectful of your peers and neighbors. we will have a conversation about many things that we feel passionately about. this is the reason why this community center is filled almost to capacity. i am looking forward to the evening and to sharing this time with you. i hope that you'll do the same with me. a couple of housekeeping notes, i want to say a special good evening. i know we have a couple of

elected officials who are here with us this evening and we see our council members right now. [applause] if there's anyone that i left out, please consider yourself welcome. i know that each of us experiences the health care system in many different kinds of ways. part of the reason why we feel so strongly and passionately about health care has to do with each of us, our own from four friendframe of reference. whether it is the streets as a patient, as a provider, as a

family member. -- our own from of reference. each of us experience is the health care system in a way. it helps us framed the way we need to make change. where the system works and where it fails. you know that across the country, every single day, 40,000 people lose their health care insurance. over the course of the time that the congress has been in recess and until we get back after labor day, something like 518,000 more people will have lost their health care insurance. the current system that we have is not working for millions and millions of people. i want to tell you how i see the health care system because it it is important for you to see my friend of reference. some of you know, i grew up in a military family. my father was in the air force.

we had the experience as a family with six children, really having tand get health care service. we went to the doctors add whichever facility my father happened to be stationed at. i left my appendix in ohio. actually, that was my tonsils. my appendix i left in spain parent to we got our medication, our drugs,. -- my appendix i left in spain. we got our medication, our drugs. as i get older, i had to get private insurance. i worked for an employer when i first out of college and i have insurance. it was not great and i had a real small salary as many

students have had. as i receive my health benefits, at one point or another, i thought just like a lot of young people do, i will not keep my health insurance because it costs me a lot but i will not ever get sick. i went through a time in my life when i decided i wanted health insurance but i had changed employers and my new employer did not provide health insurance. i was able to buy a plan for my son so he could have it. i did not fight for myself. -- i did not buy it for myself. i hoped i did not get sick. i got really sick. i was in a grocery store and i passed out. i had been sick for some time but i did not want to go to the doctor. i passed out. the emblems can get me, they took me to the emergency room

and they gave me great care. -- the ambulance came to get me. it cost me a bundle. i had difficulty paying it back. it was a real struggle. it just a couple of days ago, i was cleaning out my house and i found a folder and it had the bills from all the collection agencies and it had a foreclosure notice from my home that i almost lost and all of the bills from the hospital. i will tell you something, just two days ago it brought chills back to me all over again. the pain of the experience of not having health care. fortunately, i was able to get through that and able to pay it back. i was able to move forward. part of my experiences that i know what it is like to not have health insurance and go to work every day. then i went to work for an

employer to have great health insurance. they paid all the premium, the deductible, they did everything. i even had laser eye surgery. that was great. it taught me what it would be like to have premium health care coverage as well. now, here i am in the congress. and i am part of the federal benefit structure so we get a choice of multiple plans for health insurance. that is great. we have these plans and they are lined up against each other. you get to make a choice. you say, do i want plan x, y, or z. i like having the choice. part of the reason we're having this vigorous conversation about health care reform is because we want to talk about the details of how we can cover millions of americans who do not have health care coverage, how

we can lower costs for all of us who do, how we can create competition in a system where markets are very concentrated and there's very little competition. and how we can provide accountability and transparency so that we can make the entire system work for people. i happen to believe that we have a great opportunity to do that with this president who has sat out the goal of those things that i outlined. congress said, we have to come up with legislation that will achieve those goals so that we can get a bill that is ready for the president to sign that really has a chance of truly reforming in a comprehensive way, this health care system. i believe that we can get from here to there and i don't believe any of this is easy. if it was easy, it would have been done. our job is to get the hard work

done so that we can not just for ourselves but for our children and their children, leave a legacy of a health care system that works. just recently, we actually commemorated the 44th anniversary of medicare. how many of you receive medicare? go ahead and raise your hands. how many of you want to give it up? medicare is one of the systems where when we began the debate about medicare, there were many people said the same things that are being repeated in this debate. you know what, right now there are maybe one or two people who would say, let's just get rid of medicare. we don't want to do this. we want to make sure we provide greater benefits with medicare but this is a system we have learned a lot of doubt over the

course of 44 years. so, part of what we want to do and reform is to make sure that we also create a system where we wake up 44 years from now and says that this is a system that was created and we know that there were a lot of challenges in terms of moving but it actually works for the american people. that is what we are challenged to understand right now. now, in the house of representatives and in the senate, we have multiple bills. you have all heard that. there are many similarities but there are some differences. one of the things that i think is important is to eliminate exclusions for pre-existing conditions. how many of you have been rejected because of a pre- existing condition? [applause] if you have not been identified

with a pre-existing condition now, live long enough. you will have one. that is important. the other thing that we do in all of these bills is that we actually say that you have to pay the costs out of your pocket. for many families, that is unaffordable. we say, that is wrong. people should not have those kind of rotations. i see students hear from john hopkins university medical studentschool. [applause] i want more of these medical students making a decision about

going into primary care ended two primary practice. -- and into primary practice. [applause] many of us know that in order to sustain a primary practice in this economic environment, we need to give you some help. we want to incentivize you to go into primary practice. we want you to get loan forgiveness for going into primary practice. we want to make sure that we are educating more nurses, physicians assistants, and other health-care providers. we want to provide the kind of care in the places that people need that kind of care. i am looking forward to seeing these young medical students as practicing physicians providing the kind of care that americans need in a way that they can afford it and in a way that allows you to sustain yourself and your family. that will be a goal as well.

there are many other items that are through these health care plans. let's go to the thing that has drawn so much contention. some of those things are truth and some of those things are fiction part of what we're doing this evening as we will separate the truth from fiction. [applause] i want you to know that there is a set of experiences that forms my thinking about health care. my father at the end of his life was dying from disease. he had been on dialysis for many many years and at the end of his

life he began to have conversations with us as a family and with his physicians. he was under the care of the veterans administration. we began to talk about what he wanted at the end of his life. as his daughter and i, i know that my mother and my sisters feel the same way, it was really important for us to have that conversation as a family and important for his physicians to be involved in that conversation. it meant that by the time he reached the end of his life, all of us were on the same page. not about what we wanted individually but about what he wanted at the end of his life. i actually think it is a good thing that that is part of what we nabain able to have happen, respectful conversations at the end of life. [applause]

let's talk about some of the other fiction, if you are on medicare, guess what. medicare will get better. medicare will get better. we will create some savings in the medicare program where we take the savings and then we make investments in to medicare to strengthen benefits, to strengthen medicare so that a truly does work for all of the participants who like medicare. before i came here, i visited two of our senior homes. i asked those seniors about medicare and i will tell you something, they just wanted us to leave it alone. i said, that is exactly what we are going to do. that is another myth that we will clean up. then, there are some others. let's take another one. we have created in this plan has

been described as an exchange, a marketplace for insurance. remember, i talked about small businesses that are struggling to pay health care, some that are not able to pay health care at all and individuals that are not able to get health care on their own. we are going to create what has been described as a health exchange. this is like a market place. think about going to the grocery store and you see that shelf it is lined up with health care plan 1, 2, 3. this woman is the public insurance option. [applause] those people who are able to get into the exchange because you work for a small employer and

otherwise don't have health insurance, you can look at this array and you can say, there is plan x and that looks interesting. there is planned y and plan y a. there is also the public auction. no one gets to choose except for you. you can make a decision that you want anything that is on his shelf right here and the public health insurance option is one of those choices. right now, there are some large employers and the federal

government might be one of them, where the employee gets to choose from a range of options that have been negotiated by that employer. for most of us, i only have the one choice that i can make. i don't have an array of choices. if you are among a limited amount people were able to be part of this exchange, you actually will get multiple choices. what does that do? when you have multiple choices on the shelf and every one of them is looking at them, you, me, the consumer, then you can say, i want to compete for you. we have a marketplace of 40 million or sell that to these insurance providers including the public auction want to compete for. they want their business.

we know that competition will drive costs down. [applause] not just for the people who are part of the exchange but for all the rest of us as well. so, that is why i like the idea of including a public health insurance option as one of the choices. [applause] i get the idea that there are a number of supporters of the public health insurance option in this room. if you are currently