do not like it. the one of the parts they complain about is that they feel, and i do not work with them so i can comment on this, they work the hardest and when it came hot time for layoffs and cutbacks, they are always the first to be laid off because of seniority issues. maybe you could talk about that. also here in philadelphia, the local union went on strike earlier this year and they were offered, in my opinion, a very generous package. 1% raise over three or four years. and they still went on strike on that during a time of recession. a lot of people were hurting and who ended up hurting the most for the poor and working-class, who did not have access to cars to drive to work. what can be done for unions? . . you want to comment about that. guest: i appreciate all the questions. i hope i get some of them

straight at the beginning. you ask where the money would come from. part of it would come from government spending and borrowing. in a time of recessions, we in a time of recessions, we simply h borrow your way out of it. there are people who say do not borrow any money and things will get better. they really will not. just look at the states. in the states, there are almost $200 billion in deficit. they will start cutting back on police jobs, fire jobs, education jobs, and there will be less employment. it will get worse. our experience has said that in a case like this, you borrow short-term, and it creates jobs. those jobs create revenue and put things back into place. the bush-reagan tax cuts have

taken about $2.5 trillion out of our revenue stream. some of those taxes on the rich, we think, could be restored. you talked about some of your young friends that consider themselves working harder than everybody else. i'm sure they were parork hard. we think seniority layoffs are fair. the person was 20 years ought to be the person retained so they can continue to use their experience in the 20 years of contribution teammate to that company.

host: he also asked about the transportation strike sent philadelphia. the members of the union went on strike. guest: i think he gave a very simplistic explanation of one issue. it was a multi dimensional. a strike is a lasting that can happen. as a last resort. i agree that middle-class and working-class people rely on public transportation a lot more than the rich. we hate to see them hurt. we have worked hard in cities like pittsburgh to avoid any type of dispute. we are working with them to try to@@@@'

its coat you were just elected the president of the afl-cio. when did you first join? >> in the 19 -- in 1968 i joined the united mine workers. i became president of the mine workers in 1982, and in 1988, i brought the mine workers back into the afl-cio, so i have been a member since 1990 -- since 1988, but i have been a member of the netted nine -- united mine workers since the late 1960's. host: we go to cannae in new york. caller: living wages for most people when they get jobs, i work a part-time job. now they are taking -- they're

taking 10% of my paycheck taken out because of a hospital bill i could not finish paying. host: did they take a run of the top, -- did they take it right off the top, kenny? caller: yes, 10% of the top, and it's hurting me financially. i would like to see at least getting, having a better picture for most employees out there, when they go to work. because let me tell you something, i live on what i make, but i am not living comfortably on what i am making. host: he used the living -- he used the term living wage in his comment. when you hear that term, what do you think? guest: first of all, kenny is not on his own. a lot of people going through the same stress, anguish, and

torture that he is. when i think about a living wage, i think about a wage that will pay a family enough to keep them above the poverty line. you can gauge it in one of two ways -- with health care or without health care. without health care, we think it probably has to be a little over $10 an hour right now. with health care, a little less than that. and we are working on it. if we are going to reward work in this country, which i think we should, which i think we talk about doing, then you cannot have somebody working 40 hours a week, 52 weeks a year, and still ending up below the poverty level. i think wages should be above that. most of the countries in europe are already pushing their wages up above that, and so a living wage would allow canny and people like him the opportunity to live above the poverty level and actually have a little bit of money perhaps to put on the side. the other issue that he raised,

part-time jobs. if you look right now, with an unemployed rate of 10.2%. but when you add in the people that are working part-time jobs that want to work full time, like kenny does, you are way about -- you are way above 17%, and that is outrageous. i think we have a lot of work left to do to get people like kenny back to work, to get health care so that he does not get 10% of his wages taken out because of health care that he ought to be getting. host: here is joe, from fernand of county, florida, for richard trumka. >> i am very happy to have a union man on c-span. i really look forward to that for all the years i have been watching. i was a worker in steel, and we lost our jobs. i came to florida and i cannot seem to find manufacturing jobs. if i do find jobs, i am always

classified as overqualified. yet when i tried to get certified, it takes me at least nine months of actual struggling to get certified just to beat in air conditioning. you cannot wait that many months. and if -- to be in air conditioning. you cannot wait that many months. i did understand why we can't train people to be -- instead of going to these schools and taking so long. if we had joe the plumber out there, where are all these manufacturing jobs we should have? go ahead. thank you very much for my time. guest: joe, we are really working on manufacturing jobs as well. you cannot be a first-class nation unless you produce things. the number of things that we produce keeps going down. see, there are two economies in this country. there is the financial economy and there is the real economy. the real economy actually produces things, and the financial economy was conceived

so that it would help the real economy produce things. somewhere along the line, things got out of whack, and the financial economy started taking president over the real economy and started sucking money out of the real economy into the financial economy because you could make more money with the exotic instruments that they did. we then conceived of some bad trade laws, and trade laws that unfortunately, as bad as they were, were not enforced over the last seven or eight or nine years. the third thing was we conceived of a tax code that in many ways rewarded people for taking those jobs offshore. now, i think one of the biggest challenges that we have is to recreate the manufacturing base in this country because it slows down and you create three or four more jobs every time you create a manufacturing job for a person like yourself. the biggest challenge we have is

a lot of the multinationals that are out there, they used to make decisions that were in the best interest of the country. they cared about the community, they cared about the shareholders, they cared about the workers. now we have multinational corporations that make decisions that are in their best interests even if they are in the worst interests of this country. so our biggest challenge is to try to realign the interests of those multinationals with interest in this country so that we both win. we are going to work on that. that is the midterm and the long-term project that this country has to work on, and quite frankly cannot survive unless we are successful at it. host: bonnie is next, middletown, new jersey. caller: good morning, mr. trumka. first, i want to thank you for addressing this parody of health insurance cost for our nation. living in new jersey -- the

disparity of health insurance cost of our nation. living in new jersey, 2500 does not buy the cadillac plan, but just as the us eight p.o.. -- budget is gives us a ppo. a consumer-based economy is based upon demand, not supply. when we adopted this policy, we started to have in sane trade agreements where we were shipping jobs overseas. we decreased salary, buffeted up the ability for trade unions to negotiate, and as a result, we have a lot of working-class people who cannot afford to buy the products that we are producing. productivity went up, but the man went down and supply increased. now, if that is not the most cockeyed system that anyone can think of, i do not know what is. but we do need to bring back

strong union jobs, and to have the free workers situation there, that is only adding to our problems. we have to have, like you were speaking about, a living wage. if we can manufacture it here, we do not import it. host: thanks, bonnie. we are running short on time and what to get a response. guest: from 1946 until 1973 in this country, productivity doubled, and so did wages. about 35% of the country benefited from collective bargaining. the interesting thing about that period of time is that the people in the bottom were rising faster than the people of the top, so the wage gap was narrowing. from 1973 to date, productivity continued up but wages have stagnated. as a result, workers have had to go through three or four strategies to try to just get by.

first we worked more overtime, and that did not work. then we send somebody else from the family out into the work force and that did not keep pace. then we took on a second or third job and that did not keep pace. but we got lucky because in the 1990's we could borrow off of our 401k's because of the high- tech bauble, and that busted. then we got lucky again because, well, the high-tech bubble went away, but our house is now, there is a housing bubble. my $60,000 house is now worth $160,000, and i can borrow $100,000 and people did. so in the mid '70s -- in the mid-1970s's to this day, the economy was debt-financed consumer spending. the level of unionization went down, people could not bargain anymore, and all the profit between productivity rising and wages went to the top 1% or 2% in the country. if we are to get by that, we need to reregulate the economy,

do a lot of the things we're talking about in reregulation. two, give people the opportunity to bargain for a better way of life so that they can actually get a better share or a more fair share of what they produce. change the tax laws, change the trade laws, make a concerted effort to produce things in this country. by the way, bill, we produce fewer than 50% of the things necessary for national security in this country right now. national security, not luxury items. what we are doing is mortgaging the future. power generation is leaving -- our generation is leaving the country to a generation that has less opportunity than we had. we ought to be ashamed of that, and we should do everything we can to get the country back to where those young workers have the same opportunities at the very least that we had, let

alone better opportunities, which is what we should strive for. host: one more call -- kansas city, kansas. don, go ahead. caller: i will tell you, the biggest problem that we have had in the past -- well, reagan was ahead of that -- but that fast- track thing they finally got rid of was bush. he just went wild. what we really need right now is for obama to get into this wto and make sure that things are being unfair. as he said when he was running for office, he needs to look into nafta. we have got to get these things straight because it is just killing us. we need manufacturing back because there is only so many construction jobs. when you have got the pressure of people coming from mexico and the fact that all the manufacturing is gone, that

pushes everybody into construction. well, ok, let's talk about supply and demand. you have too many people, and of course every business will tell you there is not enough people and we need to bring more in so that we can get more workers. well, what they're talking about is they want lower wages. they are not talking about people, they are talking about cost. host: thank you, and we will get some response from mr. trumka. guest: he is right in many aspects of what he was talking about. if you look at trade, it has been an important issue and it continues to be an important issue. we have run up a massive trade deficit as a result, the chinese have bought up assets here, and they are responsible in some parts for the over amount of credit that we drown been the last couple of years. if you look at the chinese, if you look at what happened, china

manipulates its currency and it's about a 40% advantage over an american producer by doing that. china does not enforce its child labor laws, prison laws, health and safety laws, and minimum wage laws. they have an 80% advantage over an american producer that way. so if you're a small or midsize producer and you are trying to compete, before you open your doors, they have a 120 presents an advantage over you. that is unfair. that is not what the agreements say should happen, and we should actually start enforcing those laws. what we have advocated is taking a timeout, if you will. let's do an inventory of everything the works and does not work in the trade agreements. if it works, let's keep it. if it does not work, let's try to negotiate it out. so that we can have the trade agreement that really does benefit people on both sides of the border. nafta was supposed to help the

mexican worker, was supposed to help us. in fact, it's helped neither worker. it is not help the mexican worker or the american worker. it has helped people at the top of the heat -- of the heap make an extra billion dollars. host: richard trumka, we thank you for coming by this morning. >> "washington journal" airs live every morning on c-span. this afternoon, shortly, the prime minister of india is expected to speak to business leaders on u.s.-india trade and investment issues. the prime minister is also scheduled to address the council of foreign relations at 5:30 eastern tonight. tomorrow he will meet with president obama and a steak dinner. we expect him to arrive shortly.

this is live coverage.

>> again, a live picture from the u.s. chamber of commerce. we are waiting india's prime minister, manmohan singh, to discuss u.s.-indian trade issues. while we wait, a look at the thanksgiving holiday. >> a look at politics in america. from the bipartisan policy center. topics include next year's midterm elections and a mid look ahead to 2012. what is fair in politics, the role of the media, and assessing the obama presidency. also, tuesday night, the first state dinner as president obama welcomes indian prime minister singh. american icons, beginning with the supreme court, wednesday night. >> again, standing by for the

arrival of the indian prime minister, manmohan singh, speaking with business leaders at the u.s. chamber of commerce. he will be introduced by the group's president and ceo, thomas donahue. live coverage on c-span. >> ladies and gentlemen, please take your seats as soon as possible. thank you.

please take your seats as soon as possible. thank you. >> it is and gentlemen, welcome to the chamber of commerce of the united states of america. my name is ron summers of the

u.s.-india business council. for 34 years we have strived to advance u.s.-india commercial ties. today, what a historic event we have before us. more than ever, the business communities of both our countries are needed to provide an impetus to this important relationship. ladies and gentleman, please stand with me and help me welcome the individuals who are making this possible -- tom donahue, into a newly, ambassador chancre, and the hon. prime minister of india, dr. manmohan singh. [applause]

>> thank you very much. good afternoon, ladies and gentlemen. prime minister singh, ambassadors, distinguished guests, welcome to the united states chamber of commerce. mr. prime minister, we are delighted to be hosting you and your delegation today. we are certain you will have a productive visit to the united states. you are among friends. joining us today are some of the foremost business leaders in america and india. we extend a special welcome to the chair of the tata group, and

to the chair and ceo of honeywell. there will serve as co-chairs to the u.s.-india forum. i would like to extend a special welcome to-excuse me -- indira noyuye i think we should give her a special hand. all three of these business leaders have worked tirelessly to strengthen commercial ties between our two countries. this is especially true of indira. she has done outstanding work as the chair. today we come together united behind an important goal --

strengthening the friendship between the united states and india. this friendship is vital to global peace, stability, and prosperity. that we should be good friends, allies, and trading partners only makes sense. we share so many fundamental values. we are a dramatic and -- we are dramatic and pluralistic democracies. we believe in freedom of speech and worship, and we celebrate a deep entrepreneurial culture. we're committed to expanding opportunities around the world to tearing -- by tearing down the barriers to trade and investment, and ensuring that growth and development can be shared by all people around the globe. today we are good friends growing even closer, but this has not happened by accident. only 10 short years ago, the

situation was quite different. sanctions prevented u.s.-india commerce in many goods and services. at that time, trade and investment between our two countries was, as ambassador blackwell used to comment, flat as a chopped peak. but thanks to the political will of our two governments, the rich and vibrant indian american community and our respective business sectors, our economic relationship has reached new heights. today, bilateral trade in goods and services stands at nearly $60 billion. last year alone we invested over $14 billion in each other's economies. we have successfully negotiated and approved a landmark civil nuclear agreement, it easing 35 years of technological the nile -- technological denial pose

against india. every day in ways large and small we contribute to each other's economies through trade, investment, a transfer of intellectual capital and technology. in fact, one of the great untold stories is the investment that india companies are making in the u.s. economy. from information technology to hotels, from coffee to steal, indian companies are creating tens of thousands of jobs -- from coffee to steel, indian companies are treating tens of thousands of jobs. none of these accomplishments would have been possible without your distinguished and persevering leadership, nor would they have been possible without the dedicated work of the u.s.-india business council and the broader american business community working in partnership with their indian counterparts. both the united states and india are forward-looking countries,

more concerned with the future than the past. so what does the future hold for our two countries? there is no question one of our greatest challenges is to defeat the rising tide of protectionism and isolationism moving across the world. that means we must redouble our efforts to reach a successful agreement. we will be required to provide an abundant, secure, diverse, clean supply of energy to our own people, our own economies, and to the world. our technological know-how and our ingenuity will be needed to partner our industry-create the technologies that will combat climate change. and at all times, we must be powerful, consistent voices for peace and prosperity. this afternoon we look forward to hearing prime minister sing

h'. it is my privilege to introduce him. he has filled many different roles in his career and life -- teacher, mentor, visionary reformer, husbands, fathers, and sound leader. among his greatest compliments is the economic turnabout he masterminds as india's finance minister from 1991 to 1996. he helped usher in policies that unleashed a wave of entrepreneurialism and laid the foundation for the country's remarkable growth over the past two decades. on may 22, 2004, he took the oath of office as the 14th prime minister of india. under his leadership, india has

propelled itself into the ranks of global economic powerhouses. he is a visionary, a remarkable leader. his integrity inspires a whole nation, and he is a great friend of the united states of america. ladies and gentlemen come on behalf of the united states chamber of commerce and the u.s.-india business council, it is my distinct honor to present to you the hon. prime minister of india, dr. singh. [applause]

>> your excellency, mr. tom donahue, president of the u.s. chamber of commerce, ms. indira, president of the u.s.-india business council, and distinguished ladies and gentleman, it is a great pleasure for me to be visiting washington, d.c., once again. i am looking forward to my discussions with president obama tomorrow when my official program begins.

two-today's power belongs to the private sector, and i am therefore delighted to have this unique opportunity to address this very select gathering of distinguished leaders of business and commerce. ladies and gentlemanen, it in today's economically integrated world, economic relations the platform which economic, political, and social relationships are reached. the strategic relationship that is not a underpinned by a strong economic relationship is

unlikely to prosper. on the other hand, if that economic relationship intensifies both business to business and people to people contacts, promoting a deeper and better understanding between countries. that is the kind of relationship we wish to see with this great country of the united states. ladies and gentlemen, india's new and evolving relationship with the united states is in many ways the natural consequence of changes in economic policy and business practices that have occurred as

countries have responded to the processes of global economic integration. india's policies have also changed in the process, making our economy much more open to trades and investment, and more closely integrated with the evolving world economy. these policies have yielded handsome benefits for india, no doubt. in the five years before the global crisis of 2008, india's economy was growing at an unprecedented rate 9% per annum on average in the last five

years. india began to be perceived as one of the fastest-growing economies, emerging market economies. it became an effective destination for foreign investment as well. ladies and gentlemen, i am very happy to say that american business has been part of india's economic transformation. most of the large american corporations are now present in india as foreign direct investors. many are engaged in high technology work. with indian operations forming part of the global supply chain.

u.s. business in india has also groomed managerial and technical talent, which they have liberally used for their global operations. a number of companies have located there research facilities in india, affected by the ability of high-quality scientific talent and relatively competitive costs. in recent years, indian companies, factors ranging from autos, and tractors, pharmaceuticals, and software, have also been investing in the united states and creating thousands of jobs in this great country.

this two-way flow illustrates the beneficial nature of our evolving and growing relationship. ladies and gentlemen, our engagement with the united states has been expanding on many fronts, throwing up new business opportunities. the nuclear activity was at a -- i would like to acknowledge with deep appreciation the very supportive roale american business played in persuading the u.s. congress to support this important initiative. details will make it fully

operational. once that is done, it will remove restrictions on the flow of technology in nuclear and many other areas. this will open a large area of commercial opportunities for u.s. business in india. we have an expanding area of defense collaboration, including the possibility of procurement of defense equipment from the united states. our domestic private sector defense suppliers are now allowed to have up to 26 person foreign investment, opening a -- 26% foreign investment, opening a new avenue in u.s.-indian

relations in defense activities. as we work with other countries to meet the challenge of climate change, we are also addressing the problem domestically through a national action plan for climate change. which outlines many new initiatives in efficiency and clean energy. these are areas where u.s. companies are the leaders in the field, and we should explore possible areas of cooperation. we plan to sign with the u.s. government tomorrow a memorandum of understanding on energy security, clean energy, and climate change. this will provide a framework of

bilateral cooperation in specific areas. ladies and gentlemen, as you very well know, the last year has not been an easy one for the global economy. the world has been through an unprecedented potential economic crisis which has only now shown signs of moderating. there are two fallouts of the crisis that have implications for the india-u.s. relations. the first comes from the recognition that managing a highly integrated global economy requires coordinated and

collective action on a global scale. after the pittsburgh summit, the group of 20 has become the premium forum for international consultation and dialogue. as members of this group, our two countries will have the opportunity to cooperate in addressing all the critical issues now facing the global economy. the second is the recognition that a large dynamic market economies of the world are now significant players in the global economy. they are expected to grow faster than the industrialized

countries in the years that lie ahead. this will gradually increase their shares in the world economy, and also increase their contribution to global growth. india today is the second- largest of the dynamic emerging economies. like other emerging market economies, we do -- we, too, have been affected by the prices of 2008 -- by the crisis of 2008. our growth rate has decelerated to 6.7% in the year 20009 and will remain at about 6.15% in the current fiscal year. however, we expect to accelerate

from this level and get back to a growth of around 9% per annum within two years. there are a number of reasons why i believe the indian economy will resume rapid growth, despite the fact that slow-growth in industrialized countries will limit export possibilities. our domestic savings rate has increased very substantially and supported an investment rate of 39% of our gdp in the year 2007- two buse 2008. most of it in private

investment. we have ample human-resources in terms of labour skills, scientific management, the scientific talent, and management capabilities. in the world that is changing very rapidly. we have a vibrant and innovative private sector which operates independently of our government. rabin and inclusive growth in the years ahead will enable us to achieve our social objective. it will also result in 20 million people entering the

indian market for a wide range of consumer goods. american companies interested in global markets would be well advised to look at the emerging possibilities now on the horizon in india. ladies and gentlemen, a major weakness that limits our growth possibilities is inadequacy of hard infrastructure. we need massive investment in energy, transport, and other infrastructure to be able to support a high rate of economic growth. expanded investment in these areas will help offset weak export demand by providing a

domestic demand impetus to support a higher rate of economic growth. we have taken a number of steps to improve our processes of project approval and implementation. i invite american business to look at the large number of public-private partnership projects in infrastructure now being promoted by the central government and individual state governments in our country. we will welcome innovative ideas to finance such public- private partnerships. ladies and gentlemen, american business is also welcome to invest in other areas. these include agricultural-based

businesses such as in the post are the segment, including food processing, manufacturing and mining and of course services such as financial-services, and tourism. ladies and gentlemen, whenever i meet businessmen to talk about the hard plans for the future, the question i am most often asked is whether economic growth will continue. you should have no doubt. the economic reforms of the past

have brought us the advantages, and i can assure you that we will continue down this road. we might do it gradually, and in a manner which builds a consensus for economic and social change. but i assure you, we will pursue here. we plan to push key reforms in several areas, especially those aimed at bringing the deficit under control, by ensuring a strong invention -- investment in infrastructure. tax reforms, especially the introduction of the goods and services, are a very important part of our agenda.

so also are financial sector reforms. we are committed to reforms in education and development. we have started a program of equity in public sector enterprise. it is legal to follow aimed that is reducing delays, and that is another -- ladies and gentlemen, both of our governments attach high importance to the will of the private sector. president obama and i have reconstituted the u.s.-indo u.s. --

this forum will provide a platform where representatives of our private sectors can submit recommendations to the two governments on ways of enhancing private sector corporation between our two countries. i look forward to the recommendations emerging from this very distinguished group of people. ladies and gentlemen, american business has played a vital role in transforming the indo- u.s. relationship into what can today -- between the partnership between the world's oldest democracy and the world's largest democracy. i think all those present here

who have contributed to this process. i invite you to stay engaged as we transform india from a low- income country into a vibrant market of almost 1 billion people with steadily growing power. with these words, i wish to thank each one of you for being present here this afternoon. i think you. [applause] -- i think yoank you. [applause]

>> it falls to me to close the proceedings, and i would like to do so by saying what a great pleasure to be able to the with the prime minister in the united states. the dialogue of democracy is based on peace and prosperity, every time we meet the conversation is enriched. it has been an honor to host this under the auspices of the business council. my great things to come down a hole and the u.s. chamber of commerce for your hospitality today. -- and tom downholnohoe. the greatest things about our to you, mr. prime minister.

the short history of indian democracy has its heroes as well. i think you should already be added to the number. in your quiet and modest way, first as the finance minister and now as the prime minister, you have done more than anyone to lift the indian people and to transform india from one stage of development to the next. india is now on a trajectory of more rapid growth. it now stands, in fact, as a critical engine of global growth, global security, and a model for democratic development. of course, that process is not yet complete, and today in your remarks you did not want for ambition. you set out eight and vicious group -- you set out an ambitious plan for the next five years. we want to actively participate.

in this interconnected world, no nation will succeed unless it enjoys profitable relationships with others. we are all here, mr. prime minister, to underscore the commitment to the u.s.-indian partnership in the areas of infrastructure build out, education, skills development, food processing, mining, green technology, improving health care, whatever india's needs are. the challenges are many, as we have come a long way in a short time. we have been able to transform the u.s.-indian relationship fundamentally from one of cold war mistrust to a strategic partnership. bringing that to the relationship to the next level is in our grasp, and only requires the firm commitment of both our countries. the u.s.-india business council and the u.s. chamber of commerce are committed to serve as full partners in this vital endeavor.

let me close by saying it has been a privilege to welcome you here today and to hear your exciting plans for india. i understand that the prime minister has agreed to take a few questions. but let me thank you one more time and then hand you over to ron summers, who will moderate the final part of the luncheon today. ladies and gentleman, thank you for your attention. [applause] >> thank you, indra, and may i invite questions from the audience? we have a few questions. secretary william culleohen? >> mr. prime minister, thank you for your brilliant presentation this afternoon. you talked about the u.s.-india business council and how it is

successful in promoting the civil nuclear agreement. i would like to say on behalf of the united states, without your courage and your willingness to put your government on the line, it never would have happened, so we owe you a great deal in promoting this individual agreement. [applause] i cannot expand on all of the adjectives that tom donohuue and idran extended to you, but we look forward to you as being the leader of the region, we look forward to sharing intelligence with india, and we know we share many interests and ideals. one thing we share in common is the threat of terrorism, and the sharing of intelligence is going to be critical to your security and hours because of all of the business interests that are represented here but, with all the promotion of

economic prosperity, none of it will be impossible without security and stability. we recognize india's vital contribution to security and stability in the south asian region. i want to commend you for what you do and what you do to protect the security interests and ask you one question -- is there more we can do as natural allies or strategic partners, as ron simons has indicated -- is the more we can do working together to promote greater security, stability, and prosperity in south asia? >> excellus the, india and the united states -- excellency, india and the united states, with regard to sharing intelligence and information relating to terrorist activities.

we cannot be satisfied with the status quo, and in the course of the next two days that i am here, i will explore with the u.s. government what more can be done, our two countries working together. one thing i would like to say is that we greatly welcome and support the commitment and involvement of the world community to promote peace and stability and progress in afghanistan. i sincerely hope that the world community would have the system to stay engaged in that process, and any premature talk of exit will only embolden the

terrorists who are out to destabilize not only our part of the world, but civilized world's everywhere. >> we have so much to do an education in terms of the human capacity element of building our two economies, scaling up so that we can support the global growth. could you ask a question regarding education? >> well, mr. prime minister, i know how passionate you are about both education and health, and clearly your aspiration and vision of inclusive growth cannot happen without those two fundamental pillars. in education, both at the primary level, vocational level, higher education, and health, especially preventive and promoted health and primary health, we are gathered here and we have a lot of know-how

capacity capability in both of these fields. what would you like to see us do more in india? . >> we must work hard to strengthen our university system and we have plans to set up 40 new universities including

institutes of technology, including institutes of management, including institutes of public health with which of course iractively associated -- which, of course, you are actively associated. i see opportunities for the university systems in our two countries to work with each other. our biggest problem in expanding our educational system, particularly at the higher level, is the deficiency in the quantity and quality of qualified teachers. we believe that with giant ventures, with the u.s. counterpart, this deficiency can

be made good. in strengenning -- strengthening the faculty positions of our universities, we also plan to expand areas of cooperation to include private universities. and if private universities come to object in our country, that would open up enormous new opportunities of collaboration between the universities system, between our two countries. it goes without saying that human resource development is probably the most critical component of our development aspirations. if we succeed in improving the skill level of our population, we would have mounted an effective attack on problems of poverty, ignorance and disease. and we look forward to more

cooperation between the indian university system and the u.s. university system to make that happen. >> and may i ask one last question to mr. dave cody of honeywell, the c.e.o. of honeywell, who will be the u.s. cochair of the u.s.-india c.. o. forum. >> mr. prime minister, thank you for coming today and thank you for your support of the c.e.o. forum. i look forward to working with the u.s. and indian c.e.o.'s to develop recommendations that are going to be helpful to growing both of our economies. you mentioned in your comments that economics was the foundation of a good relationship. you also mentioned the importance that the significant role that u.s. business played in advancing civil nuclear and that relationship. could you give us some advice on as u.s. business what we can be doing over the next two or three

years to further advance the economic relationship between our two countries? >> excellency, india today is open for business in almost every sphere of economic activity. i mentioned in my speech that infrastructure, particularly the hard infrastructure, remains a critical component in our ambitions to realize the growth rate of 9% per an annum. and that means large-scale investments in infrastructure, in expanding infrastructure of roads, railways, urban infrastructure, boats, airports. in all of these areas i see enormous opportunities for

participation on the part of u.s. business communities. but that's not the only area. i think today there are almost entire manufacturing fields of india open for participation. so also including services, financial services, information technology services, so also are agriculture-related activities. also the ago row processing -- agro processing and agro marketing. so literally today all fields of economic activity are virtually open for participation by foreign investors. and i can assure you that no investors will be more welcome

than investors from this great country. >> thank you, mr. prime minister. and ambassadors, chairman of the india-u.s. business council, tom donahue, president and c.e.o. of the u.s. chamber of commerce, and mr. honorable prime minister, may we embarrass you by all standing and giving you a round of applause. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2009]

>> thank you. [applause] >> ladies and gentlemen, i have a dawntdin daunting task now whh is to hold everybody here so that you please enjoy your lunch. >> the indian prime minister wrapping up at the u.s. chamber of commerce this afternoon. later he'll speak before the council on foreign relations on

u.s.-india relations. you can see that live beginning at 5:30 eastern here on c-span. >> tonight, net neutrality, the wireless spectrum, and improving broadband service in the u.s. federal communications commission chairman julius genachowski maps out his goal on "the communicators" on c-span2. tonight and wednesday, house judiciary committee hearings on the long-term effects of head injuries in football. witnesses include the nfl commissioner, nfl players union president, and doctor who's treat the players. you can see that tonight at 9:15 eastern here on c-span. and tomorrow night, president obama will host his first state dinner for indian prime minister singh. we will look at guest arrivals and host tomorrow night at 9:00 eastern here on c-span. >> thanksgiving week on c-span, a look at politics in america

from the bipartisan policy center. topics include next year's mid-term elections and a look ahead to 2012. what's fair in politics? the role of the media, and assessing the obama presidency. also, tuesday night the first state dinner as president obama welcomes indian prime minister singh. later in the week, "american icons." three nights of c-span original documentaries beginning with "the supreme court" thursday night. >> coming up live next here on c-span, today's state department briefing with richard holbrooke. he's the special representative to iraq and afghanistan. until then, your phone calls from this morning's "washington journal." host: the military saying that four u.s. service members have been killed in the past 24 hours in afghanistan. nato says in a statement released today that three of the americans died in southern afghanistan on sunday.

two of them were killed by a bomb attack. and a third in a separate firefight. headlines this morning in a number of newspapers fill the fallout from the weekend debate on health care. debate heats up -- this is al "the wall street journal" plays it. 60-39 votes on saturday night set the stage for as many as three weeks of debate and compromise in december and perhaps more in january. we want to bring to your attention a headline about lobbying in the healthcare debate and rescue more broadly, who has the bigger influence?

here's the front page of "usa today" -- a number of organization hiring firms doubles. in doubles companies and groups hiring lobbying firms on health issues nearly doubled this year. about 1000 organizations have hired lobbyist since january, compared with 505 during the same period in 2008. more articles about lobbying, particularly with the healthcare debate. thoughts on who has the bigger

influence in washington? constituents or lobbyists? good morning, mike, on the line for democrats. caller: good morning, thank you for c-span. you do a great job. the lobbyist industry, the hired guns, have the most influence. the taxpayer, you and me, we are nobody. we mean nothing to the elected officials. and healthcare debate really to me is a debate about, it is about -- is should be about campaign finance reform. the staggering amount of money that they are spending, the lobbyists, industry, against the taxpayer -- a suggestion, at two,o quickly,ne, i'm interested to hear from republicans since

every republican in the senate voted against the healthcare business -- aren't there taxpayer republicans out there with healthcare issue problems, financial, of bankruptcies? is there any way you could set a line for republicans to call if you have issues and problems with the healthcare? that is my first suggestion. my second, quickly, you have the aflcio guy on -- host: that is right. caller: i think that one of six jobs is related to automobiles. we just had cash for clunkers for the japanese car companies made out like bandits and the taxpayers bailed out gm. but we have a cash for clunkers for the taxpayer who bailed out gm? host: thanks for your input. this is neal, an independent caller, from new york city.

caller: i think that the lobbyist hold the high cards right now because they control the funding on electro events. if we could commandeer -- the funding on a like toelectoral e. i think during time of elections we should have commandeer the airwaves in have mandatory debates. try to basically fund the election processes. then these politicians will not have to worry about raising money all the time. host: here is a headline this morning from "the new york times" -- party for cash, senator max baucus will be busy trying to steer a massive health care reform through congress,

but not so busy that he will be able to find time to hit >> we'll leave "washington journal" at this point to go live to the state department for remarks from richard holbrooke. this is live coverage on c-span. >> with her, of course, was our special representative for afghanistan and pakistan, richard holbrooke. we thought it was important now that there is a government in place, in afghanistan, for which to come back down to kind of put her trip in context and chart the way forward on the civilian side of the strategy as we await the decision by the president on the military component. with that, richard?

>> thanks. i'm here to report on secretary clinton's trip to afghanistan and happy to talk, too. i want to explain these members of our team from our office. this is not our whole team. these are just some of the people. but i'd like each one of them just to stand, identify who they are, and what they do because we're here today to talk about the civilian effort. most of the focus, understandably, is on the troop issue but that's not what we're here to talk about. this is the whole of government approach. some of the people you know. some of the people you don't know. i'd just like to start here and let each person stand, say who they are, and what agency they're with and what they do. and then we'll get into discussion. >> good afternoon. i'm a state department foreign service officer, focusing on -- [inaudible]

>> i focus on refugees. >> department of treasury. [inaudible] >> some of you know ronny. it's a very important issue. we have these big state treasury task forces. >> meredith. foreign service officer focusing on energy and economics. >> good afternoon. julie. working on development issues in pakistan. >> hi. also from usaid on detail working on development. >> matt. detail from the department of justice working on rule of law and other related issues. >> chris, detail from the f.b.i. working on police training and task building. >> joanne, state department,

civilian staffing. >> joanne is overseeing this enormous increase in our civilian personnel. >> jane, british foreign service officer working for ambassador holbrooke focusing on afghanistan issues including elections. >> good afternoon. i'm a senior advisor. i was on election issues and political issues. >> tim, department of homeland security. work mainly on cross border and border management issues. >> anticipate coast guard. right? >> yes, sir. >> foreign service officer working on press -- [inaudible] >> department of agriculture as the agricultural advisor. [inaudible]

>> a lot of people are missing. my two deputies. some are in the field. some are traveling. i do want to just emphasize that this is the whole of government process which secretary clinton and president obama committed themselves to when they announced this office two days after the inauguration. i've never brought this team down here before. we did one joint appearance at the cap earlier in the summer. but it was a smaller group then. and our purpose here today is to make clear that there's a major civilian component to our efforts. i do want to say one thing about jane. this is her last two or three days here. she was on loan from the british government, fully integrated to our staff. she will be going -- am i allowed to say your next assignment? >> it's not official yet.

>> unofficially her majesty's government is sending her to tehran as the deputy chief of mission. she will be replaced, succeeded but can't be replaced. she's done an unbelievable job. i worked with a lot of people who were on loan to the department. i've never seen anyone who did a job as good as jane. and we will sorely miss her. what else did i want to say about this team? we are also reorganizing our international outreach. the counterparts, about 25 or 26 counterparts to my job now established since this job was set up. and the germans had been coort naturing that effort. -- coordinating that effort. with the elections now behind us we're going to be intensifying our effort on coordinating the international effort.

the germans are appointing a new counterpart as part of the agreement between the c.d.u. and the f.d.p. we don't know who that will be yet unless it was announced today. and they will remain the coordinator. but we've agreed to set off an international cell here in the building which will do a lot of the work. so we are going to accelerate our international process. now to report on the secretary's trip. i know some of you i see here were on the trip with us. some were not. so let me just start at the beginning. this was her first trip to afghanistan as secretary of state, her fourth trip in her life. it was a very important trip. she time it had to coincide with the inauguration precisely because we felt that the

inauguration marked the end of a long, complicated process. the president used the word messy at one point. and produced a new government that we had been waiting a long time to work with, a government that had been -- that was a result of the elections. and what everyone thinks of the elections, they were not perfect. and we said from the beginning they wouldn't be perfect. all of us said this publicly well before the elections. they produced a winner and a legitimate government with which we intend to work as closely as possible. as the secretary said, we are encouraged by what we saw during this trip. secretary clinton described the moment that we saw a few days ago as a window of opportunity. on the night we arrived she and

i and ambassador ikenberry and general mcchrystal had dinner with president karzai at the palace. it was a very warm and very cordial meeting, substantial index in tone from meetings during the election period. the election was behind us. and he brought with him his senior ministers in key areas. and the first part of the evening was devoted to very detailed discussions with the minister of agriculture, the minister of finance, the minister of education and the chief of intelligence. the minister of interior was supposed to be there, but he was out in the city making sure that there would be no attacks during the ceremonies the next day. so we missed him. the conversation was detailed and engaged. those of who you knew hillary clinton as a senator and followed her closely may or may not know this. but she had been all over the agriculture issues as senator.

she had worked with the state university of new york. i think it's stonybrook but i'm not positive. to get a big tree planting program. she followed it very closely. she was fascinated to hear details which normally don't interest all of you but interested her greatly about 12 tons of apples that were airlifted to india a few day before we arrived. this was a very big story in the afghan press. it opened up a new opportunity for afghan agriculture. as i think you all know, after the security issue we believe agriculture is our highest, immediate priority in the civilian area. for the simplest reason. it's 80% of the people. they're great farmers. they have big export markets until 1978. they had exported pomegranates, raisins. they dominated the world raisin export market, almonds, save

ron, wheat -- saffron, wheat of the they want to get back to that, but ha they need help. we inherited a situation where the united states was putting less money into agriculture than they were in poppy crop destruction. that didn't make a lot of sense to us. so as i mentioned, the last time we were here we phase the out supporting poppy crop ee rad raition. that's still run but the u.s. is not involved. the military is focusing on on interdiction. they are working closely with the d.e.a. and the f.b.i. and other parts of the u.s. government. and they have had very substantial success in interdiction. and meanwhile we're putting a lot of money into agriculture. auto gonzalez, our liaison with the aagriculture department.

we have had to reschedule going to afghanistan because he is involved in some high domestic priorities. but he will be going early next year. and that will be a very important trip for us. so she engaged in a very detailed discussion of agriculture with the minister. then the finance minister discussed both economic issues, the ongoing negotiations from the transit agreement which president obama had mentioned specifically in the may 6 and 7tri-lateral summit. mary beth goodman is our point person on that both here and in islamabad and kabul. we talked about anticorruption efforts and the general financial state of afghanistan. then the minister of education gave a very encouraging report on the progress that has been made despite the taliban in that

field. this was an impressive performance in these fields. the intelligence chief talked about the taliban. and she talked about that in her public comments in afghanistan which have been issued by the department. on the personnel side, we are dramatically increasing our personnel. joanne is in charge of that effort. when we came into office, they were about 300 american civilians in all of afghanistan. and most of them were on six-month tours. and they had very substantial leave arrangements to go to dubai or adu dabe or somewhere else. there were no month six-month tours. spouses were allowed to come, indeed encouraged to come, if

they take jobs. and the school-age children issue is a big problem. but there are plenty of spouse there's now. that, of course, has multiple payoffs. leaves have been changed. and more and more people are signing up for a lengthier tour. and some of the people here have had tours in afghanistan and will rotate back. so we are going to be at about 900 people. i think jack gave you the figures in his lengthy press conference the other day. and some of you went to camp with jack on thursday, the same day we were in kabul, and you saw the training process out there which derrick hogan has been responsible for setting up. so the civilian effort is going quite well. i must say, a tripling while we eliminate six-month tours is

really more than a tripling in terms of persons gained in the field. it's far more so this is an extraordinary increase. and if you consider that each one of the americans has a footprint of nine or 10 support people -- afghans, third country nationals, n.g.o.'s -- it's a very large increase. proportionately larger than the military. we will have 900, about 900, by -- >> [question inaudible] >> yeah. 974 by the end of the year is the target. actually, to be even more precise, 974 by the early weeks of next year. we're going to run a couple of weeks behind the original buildup schedule. not because we don't have the people, but simply because of the vetting and personnel processes. it's as simple as that. i don't want to go into all of these figures because that's not

why you're here and you've already heard from jack on that. but it is very important. and more americans, civilians, will be on their way next year. we're in advanced talks with ambassador ikenberry, jack lou, a.i.d. and elsewhere on that. on thursday of last week the dinner -- the dinner was wednesday night. on thursday of last week after the inauguration ceremonies secretary clinton and i, general mcchrystal and ambassador ikenberry -- eikenberry met with an extraordinary, impressive group of american civilians and military who have come in from the field. all of the seniors except the secretary of state sat off the table. the table was only the people from the provinces. and for a very long time, i would say an hour and a half or more. and this actually delayed our

departure from kabul. and this is the reason for those of who you remember why we didn't land until after 4:00 in the morning. it was this meeting. she was enjoying it so much. she really drilled down on rule of law, on agriculture, on civilian military integration. and i know that she has already described this to her colleagues in the principle's committee. i'm sure she will do so again in the meetings that are coming up. it was a terrific meeting. she was enormously proud of this integrated civilian military process. we all talk about integration. and the bottom line is the closer you get to the battlefield, the closer the integration. and at the province level and the district level, it is really remarkable. now, on pakistan.

this room on pakistan since she returned. i have traveled and watched many secretaries of state. i've never seen a secretary of state have a trip in which the public diplomacy part of it was more extraordinary than this trip. everywhere that she went she was greeted as an iconic person but then hit very aggressively on issues. and she just kept taking the questions and making an extraordinary impact on the pakistani people. as many of you in this room know firsthand, everything she did was covered live. her visit to the shrine was a particularly successful and got huge approval. she met with women's groups,

hundreds of women. students, businessmen and women, parliamentarians, tribal leaders from fatah and elsewhere. she gave interviews to the radio journalists of pakistan. and as it evolved, it was a conversation. she seemed to be saying -- and this is me. this is in my words, not hers. she seemed to be saying we are friends with the disagreeing and this is the way friends talk about things. and you could see the impact. she also had very important private meet ings with the president, prime ministers, and generals. and nawar sharif and chief minister sharif. so she had one of those trips that those of you accompanied

know how intense it was. i was very proud to be part of that trip. and i think it marked the beginning of a turn in our relations with pakistan. you're not going to see it show up immediately in public opinion polls. but goal here was to lay the foundations for a partnership, a deeper, more productive, genuine partnership among two sovereign nations. she also agrees to renew the strategic dialogue. in the previous administration strategic dialogue was conducted by the deputy secretary of state on the american side. she will personally lead the strategic dialogue. now, there's been a lot of talk about tri-lateral and bi-lateral and not coupling afghanistan and pakistan. the truth is, we have bilateral relations with each country. but they are interrelated.

and this addresses it directly. she's elevated the strategic dialogue with pakistan to the ministerial level and will personally lead it. and we will tee that up for early next year. not too early. we don't want to just have a meeting for a photo-op. and meanwhile we will continue the tri-lateral process. so we will parallel track here. we are completing a new civilian assistance program which will broaden the scope of our relations with pakistan and help pakistan address its long-term development needs. the reason we relate to this meeting is we are meeting with the ambassador, back from islamabad. she's essentially our chief of operations in pakistan now. and she -- valley and she are working right now. we are working out the operationallizing of the general agreements as we speak. and we're talking about how to

improve our economic assistance and to help overall the people of pakistan in their major needs like energy and water. water came up more than any other issue on the trip. even more than energy. and we took that very seriously. and our n.g.o. officer, ronan farrow, who's not here right now, was working on the water n.g.o. issue because expertise on water is much greater in the private sector. all of this has gone with our new public diplomacy effort. we hope that the pakistani people will recognize our deep respect for their sovereignty and our deep commitment to help them deal with the pressing problems they face. so that's a brief report on the two trips. i think with that i'll be happy to take your questions.

if it's too technical, i would defer to one of my colleagues. >> there's been a lot of talk about whether the afghan military force is kind of a reliable partner. but i'm wondering in terms of the civilians from what you've seen on the ground as you ramp up your civilian presence, do you think you have enough of a well-trained kind of afghan civilian reliable partner to do what you need to do or do you think that there will be as much need for training of the afghans? if i mieghtd on pakistan -- might on pakistan, there's a lot of uncertainty about the future stability of this government given some rulings that are going to be coming up. i was wondering how much of a concern is that that there could be a vacuum. >> i'm not going to comment on the internal affairs of pakistan. i just want to make that clear right now. we're well aware of it. we're following it very

carefully. if it's an internal, political issue it needs to be dealt with by the pakistani people. that's all i think i should say on that. on your first question, you know, like any government there are minister that are better than other ministers. there are some minister who's have put up extraordinary records. >> go back again, for example -- i'm afraid if i single one out it won't be good for his health. so i won't single any out. but we want to work with the strong ministries. and we also recognize that the leadership in afghanistan is thin because of the high literacy rate, the horrific consequences 30 years of continuous war, the enormous set of refugees that the people who left the country and very few of whom have returned, and the

conditions in afghanistan. this is one of the main reasons we're increasing our civilian role. it's extremely delicate to get the mix right. we want to help the afghans help themselves. we do not want to replace a sovereign government with internationals. and by the way, many other countries are increasing, too. so if you go into a ministry now, you may run into people from the u.n., from e.u. countries, japan. it's quite complicated. and one of our major goals is to coordinate this better. and that's what i meant when i alluded earlier to our new efforts to coordinate international. so what is our belief in the capacity here? well, it's very hard to answer this question. we know how important it is. building the afghan government's capacity to run their own

affairs is one of the three or four of a process by which eventually on a timetable i can't give you the international combat troops, including the u.s., can be replaced by local security. and the international civilian advisors can phase down over time. but international economic assistance will continue for a long, long time. as secretary clinton has said publicly during her trip. and i want to stress that point. >> two things. there was a statement that it's believed pakistanies do not necessarily share u.s. intention for afghanistan and they have their own intentions and they

may be pursuing that. if you'll comment on that. and also, he said that he's not sure who is running the pakistan army. and there was also a report in the pakistani media today that probably u.s. government representatives in afghan and the pakistani government representatives had a meeting with the taliban somewhere. >> first two questions i'm not going to answer because i haven't seen the statement. what was your third? >> a meeting between the u.s., afghan and pakistani government representatives and the taliban. >> to my knowledge, and i believe this is absolutely true, there has been no direct meetings between american officials and taliban officials. there was one accidental engagement about a year ago, actually before the inauguration of president obama. it was inadvertent and it wasn't a real taliban. and that became public.

and we cleared that up. we are not having direct contacts with the taliban. secretary clinton in her speech to the council on foreign relations -- was it june or july? >> july. >> july 15. she made a speech in which only a few of you know the paragraph on afghanistan. one or two of you reported it. that was very important. she laid out the conditions by which the u.s. believes people fighting with the taliban can rejoin, reintegrate into afghan society. and the first point she mentioned was -- [inaudible] remember. and never forget, we are in afghanistan because of 9/11. the other thing was to renounce violence and to lay down their

arms and participate in life peacefully. in fact, many, many taliban have done that since 2002. people who were senior officials. some of them are in the national assembly. you have former taliban in the national assembly. there's regular contact between them and internationals including americans. but what you're talking about, no, sir. yes, sir? can you identify yourself? >> the bbc. how reassured were you by what you were hearing about the fight against corruption? and can i ask you what is it that concerns you? corruption can cover a whole host of different activities. >> corruption is enormously complicated issue. it's easy just to put the word in a headline. but when you really get down to it, what does it mean, what's

the difference between traditional and big corruption? these are very complicated issues. let me be very, very clear on this. we are deeply concerned about corruption. and secretary clinton did not hesitate to discuss this. because the international community led by the united states has such a large footprint in afghanistan. and a lot of the targets of opportunity for corruption come from the international community. so we have a legitimate concern on that score. and that's what the g.a.o. and sea guard, special inspector general for afghan reconstruction focused on. and because we have american

troops and our allies on the line risking their lives, we have a legitimate reason to ask for per performance on corruption. -- for better performance on corruption. president karzai addressed this problem. saying he would strengthen the existing commission on corruption and he would hold some special conference on it. i believe was his word. i don't have his speech in front of me. but we discussed the subject a at considerable length with him. yes, sir? >> john from al-jazeera english television. a question about the visit of singh, both key areas of responsibility. india was more inference on afghanistan and has pumped i in $1.2 billion into the country. you talked about the apples coming back the other way. >> trade imbalance. >> pakistan, on the other hand,

remains suspicious of indian -- they talk about -- the indian reach. how can the u.s. balance the interests of these two key partners, one of which is the key ally in the war on terror? >> first of all, all americans are just delighted at the first state visit of this administration is for india. i think this is very appropriate. and no one in pakistan and no one in any other country should read this as a demunition of the importance to them. someone has to have the first trip. it usually in the past is the european ally. but they come over in informal trips. a state dinner, a state visit is a big deal. a different level of intensity. and president obama thought this was the right way to go. we're thrilled.

it in no way should be read as a demunition. we seek to improve our relations with pakistan. we seek to improve our relations with china. we seek to improve our relations with india. this is not a zero sum game. every country benefits from an improvment in the area. i'm not going to go into the specifics of it. first of all, it's not part of my formal responsibilities, although i look forward to participating in some of the meetings. and seeing some of my old friends from new dehli. i do just want to say that i read the press, i understand with new delhi and islamabad, what they say about each other. but it's really -- it really is not justified by the facts in many cases. these two countries live side by

side and have to live together. and our role is to assist both of them in different way as cording to their own desires and their own view of their own sovereignty. >> thanks. before we met with you in kabul, you had been in moscow. we never got a readout of that leg of your trip in between pakistan and afghanistan. could you tell us what did you accomplish in russia? did you get any specific commitments? >> actually, it was in berlin, paris and moscow. >> right. >> and also met with the british along the way. then i would add, since i'll do the whole international that in kabul, as you saw, we had foreign ministers from france, the netherlands, deputy foreign minister of japan. and i would draw your attention to the fact that the japanese quadrupled their aid last week and went up to $5 billion in commitments. they tremendously enforced

decision by the new government. canada, their foreign minister was there. the indian foreign minister was there. and the senior officials from many other countries. specifically to russia, as you know, i've been trying to go to all the concerned countries. but i haven't been able to get to all of them up until now. i still haven't gotten to all of them. simply because of two things. the need to make in the early part of my job -- i had to go to afghanistan, pakistan a lot because there were so many issues to straighten out. we were in a period of transition in our leadership in afghanistan and we had to put a whole new team in place. and we had to rethink our pakistan policy in conjunction with anne patterson. our ambassador there who has been kept on because of the high confidence we all have in her. now, i was unable to get to moscow earlier for logistical

reasons. just scheduling. in that talk we outlined to the russians our strategic view and put forward the simple proposition that russia and the united states, like all the countries in the neighborhood, have a common strategic symmetry. that stability is something that's important to all the neighbors and near neighbors. the russians pointed out to us that they had legitimate, strategic concerns in the area which we agree with. and they have won overriding issue which is mentioned prominently in the joint communicated president obama and pred medvedev dated july 2 or june 2. i can't remember which. but one of those two dates.

and that is narcotics. that is a big, big issue for the russians. and we talked a lot about how we could work together on that issue. and we explained our policies. i met with the deputy national security advisor. the national security advisor being out of the country. i met with the other foreign minister, my old counterparted of the united nations and a close friend. met with members of the ministry of defense. and reassured them that the united states does not seek a permanent nato presence in afghanistan. i met with the drug czar, with the russian equivalent of fhimah, wane -- of fema, and with many other officials. it was a very productive, open meeting. we agreed we will continue the dialogue. i took an interagency team with me from various agencies. and we will continue the dialogue in the near future. we also had a team in china

before the president's trip. and we have had consultations with turkey which we are going to continue. so there's a lot of activity going on. >> any pledge or promise or agree to give any particular kind of assistance? >> no. >> land roots? >> well, i leave to general petraeus logistical issue. they didn't give any promises, but they showed considerable interest and readiness to do more, to help prepare some of the -- repair some of the damage that has been wrought over the last 30 years. it's a complicated issue for reasons you all understand. but in the -- but we were very pleased with these initial talks. >> a couple more questions. >> yes. ambassador holbrooke, charlie wolfson with cbs. given that you're here to talk

about the civilian side but recognizing that a lot of the civilians who will be in the field depend on the increased military and given that the president's announced a meeting tonight at the white house, he's had eight -- i believe this is the ninth. where does thoroughness in decision making stop and indecisiveness start since he's been accused of them? >> you know, the last time i was at this podium i said very frankly that my experience on these issues -- and as a very junior officer i list through the lyndon johnson decision making process in 1965 and when i was in saigon. in 1968, when i was the assistant to the deputy secretary of state. as i've seen a lot of these things, this is the most thorough, the most sustained, most thoughtful process i have ever seen.

and over the long course of it we have seen -- we have all learned a great deal from each other in a way which i think is exactly the way decisions should be made. i'm not going to get into public debate. i'm not going to go in that direction. i just feel that what you've seen is a very serious debate. and that's really all i want to say about it. but i'm honored to have been a small part of it. >> nbc television. you talked about corruption and said you were very concerned about it. considering you had the minister accused of taking bribes, would that administration -- [inaudible] on the reconciliation issue, president karzai talked about meeting. they have been very negative. does this undermine the efforts in terms of having a stable new

government? >> on the first half of your question, we're not picking the ministers and the government. but we certainly hope that the ministers are the best possible ministers. and who they are and how effective they are and the issue you just mentioned will all be factors in determining our interaction with them. to be quite honest with you, i want to learn a little more about what the government has in mind before i opine on it. it's not 100% clear yet how it will work or what its purpose would be. and it's part of another process where there's some international conferences in president karzai's inaugural speech he talked about a conference in kabul next year. that's also part of the process. i think one more.

>> you said the united states can assist pakistan and india toward peace and security -- >> please be careful here. i don't think that's what i said. i said that we think good relations between the u.s. and india and good relations between the u.s. and pakistan are not incompatible and that we are not going to get involved in negotiating these kinds of things. please, it's really important because when we get misquoted or twisted by some of the press in these countries, we really have to spend a lot of time -- poor p.j. has to spend the whole night with the time difference cleaning it up. let's stick to the precise words i used here. >> would you support an exemption of talks between the two countries? pakistan said it would feel more at ease to fight terrorists -- >> if the two countries decide to resume talks with any sort of

talks, of course we'll support them. but we're not their midwife, we're not their intermediaries. we're not trying to play a role that goes beyond our will he --d our area of involvement. >> a follow-up of my colleague's question on the talks with the taliban. apparently the saudis and the british are involved in those talks with the taliban along with the pakistanies. do you have any details on those? >> i can't speak about the british. you have to ask them. as far as the saudis go, president karzai mentioned them by name in his speech. it's well known that he asked king abdullah to play a role here. and i will let the saudis speak for themselves. i have talked to the saudis. i have been to riyadh. i talked to king abdullah about it myself. we would be supportive of anything that the kingdom chose to do in this regard.

>> but i was talking about pakistan there. >> i thought -- >> about the talks with pakistan -- >> oh. i don't know anything about that. i read a news account, but i don't know what the facts are. >> you also mentioned the trade transit agreement. what is the status of those negotiations between afghanistan and pakistan? it seems that they are stalled and that you won't make the deadline at the end of the year. >> i don't think that's a fair conclusion. have any of you ever seen a negotiation which didn't go down to the wire? an international negotiation? i think we have a good shot at making the deadline. there are two or three outstanding issues. is that right, marybeth? >> right. >> if you want more details than that, why don't you call our office. i don't want to involve everyone in it. but we are hopeful it will be done. let's be clear for those of you who haven't followed this negotiation. this negotiation began before half of you in this room were

born, 44 years old. really. older than you are. [laughing] i can tell. not older than me unfortunately. this is 44 years and president obama asked the two leaders of the countries to try to finish it by the end of the year. it's a very ambitious goal. it's not easy to do and we have gotten it down to two or three issues. my hat's off to marybeth goodman for the role she's played here. .

>> the secretary of state was in islamabad, the national security adviser was in islamabad, and the prime minister has been here twice in the last -- how long -- five weeks, six weeks. we are in constant contact, also through the excellent ambassador in washington. i don't believe that anyone seriously things we are not having detailed consultations with pakistan. if that was said, i think it has to be put into context. but there is no country we are consulting more closely than pakistan, nor is there any country that is more integrally related to this issue. admiral mullen is and constant

contact with the pakistani military, i am in constant contact with leaders of the government by phone and other means. i don't see that as the real issue. thank you very much. >> thank you. >> today's state department briefing. and now live to the white house for a briefing with spokesman robert gibbs. >> throughout the conversations between the president and the prime minister. i think this is a show of respect for the value we put on that relationship. i think india is the world's largest democracy, and i think the relationship that we have with them and issues we are dealing with them are tremendously important going forward in our future. >> the president said last week,

i believe, that he wawould consider a firing offense the people who leaked information about the afpak decision. what type of report does he plan to ask for, if any, to review this? is he serious about pursuing some type of investigation or inquiry into this? >> let me just leave it at this, jeff. the president as on a few occasions at meetings like this talk about the importance of being able to have an open discussion among his advisers as part of this process. brines people that we have meetings and a decision -- he reminds people that we have meetings in the situation room and not a local restaurant because the importance of and sensitivity of some of the information discussed throughout his meetings. -- throughout those meetings. i think the president believes

strongly that being able to get the type of information he wants, discussing the sensitivity of much of, as well as being able to ask questions and get more information, is something that is important in formulating his decision and is important to do in a way that people feel confident that they can be candid with the american president. i have not talked to him about whether or not -- what specific measures he might have in mind to follow up. i know that with that interview, secretary gates has said in a previous interview about the same topic. >> with respect to healthcare and upcoming bill in the senate, will the president take a personal will to iron out differences? >> i think he will play the symbol he and the team of played here. we would not be at this point if

he had not played this role in getting this process forward. >> is he going to have public events? >> i do not have the week ahead for next week but i can assure you that the president will talk to legislators about the importance of getting this done. >> the president's top domestic priority, should actually cleared next week -- is there any chance that this will actually be on his desk for signature this year -- >> that is our hope. >> you think it is possible? >> i do. i would not remove the deadline here and now. as i said earlier, this is a goal the people have had for seven years. we have never been closer than we are now. we've never had a full vote in the house and full sun. -- we have never had a vote in the full house and full senate. i think we are continuing to

make progress on a bill that will make health care more affordable for people that have it, an increase accessibility for those who do not, provide important insurance reforms, as well as the end of the cost curve and change the deficit over the next 10 years. -- as well as a band of the cost curves and change the deficit over the next 10 years. >> the chairman of the house deliberations committee is against sending any more troops into afghanistan and says that it would be a mistake that could wipe out every initiative we have to rebuild our economy at home. where would the president before an infusion of troops, -- where would the president pay for an infusion of trips, and you think that jeopardize is in some sense his domestic agenda? >> on the specifics of paying

for it, i will wait for a decision to be made before we get to that point. second, this is an issue that the president's talked extensively about during the campaign, the need to focus our attention on the dangers of afghanistan and pakistan. i don't -- presidents don't get to decide what issues ultimately get to their desks. i think the president understands that the war in afghanistan was one that he was always going to have to deal with, and i don't think that dealing with that as an issue threatens the president from also being able to deal with very important issues like the economy, like health care, and many other things that are either part of his agenda or might not be planned but end up on his desk anyway.

>> robert, just on the jobs question, does the deficit constraint the scope and addition of any jobs program -- constrain the scope and ambition of many jobs program? >> i would cite the interview he did last week, where in many ways we have to deal with challenges. in order to deal with the deficit, one of the most important things that we control going forward or had input on going forward is an economic recovery, that we should not shy away from doing what needs to be done to continued economic growth and to spur job creation in the future. at the same time, we have come in the medium term and long term, fiscal issues that have to be dealt with. the president ahas had to balane

this since the first day of his administration. i have no doubt that the balancing act will have to continue moving forward. >> just to follow up on just the little bit on whether the leaks are a firing offense, does this apply to the pentagon or the white house also? >> i don't think the president would discriminate from where the person sits. >> he has made no indication of whether he wants to find out -- >> i have not talked to him opposed to that interview about it. -- not talk to him post that interview about it. >> on the issue of the copenhagen summit, is the president saying that there will be any treaty with the binding commitments, and does he feel

that other nations have failed with a treaty that actually had a binding commitments and setting up goals for those -- >> first and foremost, getting a political agreement out of copenhagen after years and years and years of inaction on clean energy and climate change, the president with you as a very positive development -- the president would view as a very positive development. i do not think any of us were under the illusion that, again, having been off the world stage for so long in dealing with this issue, and understanding what it was going to take to get developing nations of the world at the table that all of these issues might be neatly wrapped up by december of this year. i don't think that has cost the president to the -- has caused a the president not to act.

obviously, the house has taken action, the senate is in the process of moving forward on a clean energy and climate change legislation, and i think the president is going to spend his time focusing on what we can get out of copenhagen in terms of a binding political agreement move forward. >> does he have to wrap up his efforts at home here to get something out of the senate -- ramp up his efforts at home here to get something out of the senate? >> the president has certainly spent time on this issue in dealing with members of the senate. again, go back to my health care analogy -- we had an issue that has been something that scientists had talked about for quite some time, it is through half of the process and getting the house to agree on a bill.

we understand it is not all of what has happened, but it is certainly a good start after years of not dealing with the issue. >> with the scope of what the president is dealing with with these meetings, dealing with the people in the pentagon and the administration, at the end of the day, could the president say, "i choose not to have additional troops in afghanistan"? >> there are a plethora of decisions that could alter a sleepy the outcome of this -- that could ultimately be the outcome of this. i do not want to prejudge what it might be. >> is that a viable -- >> i think there are a lot of different options on the table. >> going back to the gao report last week, it talked about only

70% -- 78% has not been spent out of the stimulus money this year. first of all, what was it rushed through -- >> what was what rushed through? the gao report? >> the stimulus report rushed through -- >> i appreciate the characterization. i cannot agree with the fact that -- i don't know how much time be spent discussing it here, but i don't consider that time we stood. -- i don't consider that time wasted. i assume that the measure you looking at is final money that has gone out the door and does not include obligated money which allows, for instance, said rhodes project - the czech -- federal rhodes project -- the

czech might not come until the end, but that does not mean the money cannot be agreed to, and with respect to the construction company as well as the indirect jobs that are ultimately created as part of that, that money is not spent. i can give you an updated figure, but i think within 50% of the money has thus far been public -- more than 50% of the money has thus far been obligated. >> there was talk of nearly 4000 jobs -- 50,000 jobs were created, and also, in a case where $1 billion was allocated, there were no jobs created. >> obviously, there has been an unprecedented amount of transparency in the recovery act, on like we have seen in all honesty in any piece of -- unlike what we've seen, in all

honesty, in any piece of legislation before. with the rewards and contracts on the internet, as we said, there were about to be some errors. what is indisputable, if you ask economists as the bill had a positive impact on our economy and our economic growth -- the only factors i can point to a gdp of the previous four quarters -- the first quarter of this year, the revised figure was -9.5%. the initial estimate for the third quarter of 2009 was + 3.5%. i'm not even good at math and i know that is a pretty big variance and in terms of an economy that is contracting and an economy that is growing. a lot of people are rightly concerned about the employment

in this country. i don't know of an economic model where an economy that has contracted, particularly at a quarterly rate of almost 6%, is adding jobs. in fact, in that period of time, we saw once where 741,000 jobs were being lost. the president and congress took the necessary action to institute a recovery act that has helped spur economic growth, has led to the first positive economic gdp growth in four quarters, and, again, you not going to create jobs in this economy in a scenario with negative top growth. we are on a road to the recovery through this plan. thank you.

>> today's white house briefing. we got pretty much the tail end of it. we will rewrap the tape and show it to you from the beginning in its entirety. >> all right, settle down, settle down. let's just go through -- let you get seated here -- grocer a quick week ahead. -- go through a quick week ahead. obviously somewhat abbreviated because of the holiday.

the president will welcome prime minister harper manmohan singh and his life to the white house for the first official -- prime minister manmohan singh and his wife to the white house for the first official visit the president and the prime minister will meet in the oval office and following the meeting, there will be a joint news conference in the east of approximately a 11:35 a.m. >> [unintelligible] >> i think it is one and one. i the one and one or two and two. in the evening, at 7:00 p.m., the president and facility will come the prime minister and his wife -- president and first lady will welcome the prime minister and his wife to the white house. there will be a presentation on the history and protocol surrounding state an official visits.

on wednesday at 11:00 to the a.m., the president will participate in the traditional turkey parting ceremony in the rose garden -- turkey-pardoning ceremony in the rose garden. no questions for the turkey. on thursday, the president will participate in a service of and in the d.c. area people spend thanksgiving day at the white house. on friday at -- he will spend thanksgiving day at the white house. on friday at 2:00 p.m., the presentation of the official white house christmas tree. it will be on display in the bloom throughout the holiday season. -- in the blue room throughout the holiday season. all right, yes, ma'am. >> the afghanistan meeting -- the last meeting, he said he would take another look and reorder things. is denied about looking at what

they are coming back with? -- is tonight about looking at what they are coming back with? >> they will go to the questions that the president had, additional answers to what he had asked for, and have a discussion about that. >> what is it he wants to hear? >> picking up where we left off , i characterized a decent part of it as not just how we get people there, but what is the strategy for getting them out. i think that was a series of questions that the president had on that that they will go through tonight. >> [unintelligible] >> not that i am aware. yes, sir? >> will the president be ready to roll out a decision the week after thanksgiving or will it take longer? >> i think you guys road on

friday based on an answer that i gave you guys that it would not be rolled out this week, so obviously, the first possible time would be sometime next week. >> first possible time -- likely to be done then? >> when the president tells me what is likely, i can add that to it but i can just say that it will not happen this week. >> cedar lawmakers are saying that the should be a war tax -- senior lawmakers are saying there should be a war tax levied on any troops contributed to afghanistan. is the bustling to take that into consideration? -- is the white house willing to take that into consideration? >> i will not get into how the funding decision will be made. i will say, to take a little bit of a broader view of the deficit, obviously, one of the things -- two biggest changes in

our fiscal situation in the last nine years and the two biggest drivers for deficit spending for the next -- from here until the next 10 years our tax cuts and prescription drug benefits. programs that were added and ultimately not paid for. but think one of the things that has happened with the health care debate is the changing of the conversation in washington by talking about not just how do you pay for it, but the piece of legislation that cbo estimates anin the house or senate version will cut the deficit over the next 10 years. >> it is important to recognize that we keep adding to the debt some point -- and at some point it could lead to a double-dip

recession. what steps are the president -- what steps is the president willing to take to get us out of this hole? >> broaden this just slightly -- for the entirety of our administration the of adults with mental challenges. how do you get the economy back on track, what do you have to do to both create economic growth, which is what you have to have in order to create job growth, as well as understanding the dramatic change in the past decade of prescriptions but both of those have to be taken into account. the two biggest drivers were tax cuts and prescription drug benefits, programs that were not paid for. the second-biggest profit is the downturn in the economy. the first and foremost -- second-biggest a driver is the downturn in the economy. first and foremost is what can be done to get the economy

moving again, what can be done to spur the creation of jobs and continued economic growth? the conversation in some ways has been changed. the discussion being had now, as you know, is how to pay for health care. >> that is not really any major -- the answer to what can be due to -- >> first and foremost, yes, the downturn in the economy caused by the recession, a change in tax receipts, it is first and foremost what can be done. obviously, there are meetings that continued today in terms of putting the budget together for next year. understand that the president believes that we will have to continue next year to balance what has begun to create -- to continue economic growth and create a demand for jobs, as

well as balancing our fiscal situation. >> ok, and arrested, getting the economy -- ok, understood, getting the economy back on track will increase revenue, but the president said that even when the economy bounces back -- >> well, you heard the president talk quite a bit that we both assuredly have to get the fiscal house back in order. >> right, but will be done? >> they are putting together the budget for next year but one of the things it talked about was keeping a cap of the massive amounts of money spent by the government on -- keeping account of the massive amounts of money spent by the government on health care. the cuts on hundred $30 billion, according to the senate bill come out of the deficit -- it cuts $130 billion, according to the senate bill, out of the deficit. >> but compared to what we are

from china every year -- >> you have to start somewhere. there are very big challenges that have to be addressed and getting our economy moving again, as well as taking into account our long-term fiscal health. >> to follow up on the tax increase question, as part of the discussion that the president has been holding, has that issue come up in terms of how pet -- >> well, how to pay for the war, yes. >> as taxes come up? >> they have not deeply gotten into the discussions on that. the president did mention in one of the meetings specifically with the joint chiefs that we had to take into account how much all this was going to cost over a five- and 10-year. -- and 10-year period. gues>> should we tax americans -

>> at the meeting i was in -- g>> can you give us a sense of how the president reacted with the health care, when this occurred? >> i was not with him when it happened, but i think the president continues to be pleased that we are making progress in moving the legislation forward. keep in mind that for 70 years, people have wanted to get health care reform done, and in that seven years, we've not had a vote on health care reform in the full house or full senate. the legislation has passed the house and goes to the floor of the senate this time next week. >> what was in the chosen -- what was in india chosen for the first state dinner? >> i think it is the importance of our relationship with india on a whole list of issues

obviously, counterterrorism is important. the economic recovery and world recovery. our relationship with them in terms of climate change. obviously, india is in a very important region of the world. it demonstrates the importance that that relationship has in the world. >> is the president going to ask people in the meeting and the white house about doing more in afghanistan -- [unintelligible] and does the president have an announcement to make with the security council -- [unintelligible] >> we will have a chance to talk about what the two leaders talked about tomorrow. i do not want to get ahead of what the president might ask of the prime minister. >> are you thinking that --'

>> again, i don't want to get ahead of what the two discussed tomorrow. >> on afghanistan, it has been more than a month since dick cheney accused the president of dithering on this decision. he now has this ninth meeting. are you concerned that americans are increasingly looking at this present as simply indecisive and uncertain on this because he's taking so long? is he having trouble making this decision? >> no. look, chip, this is a complicated decision. i will not reiterate from one the vice president made his comments previously agree. there are serious decisions that have to be made and he will come to us with what he believes is

the best way forward for our national security. i think the american people want the president to take his time and get the decision rights rather than make a hasty decision. >> there are a lot of allies out there who are concerned that it does look like indecisiveness and their jobs are more typical with their roles in afghanistan. >> like? >> numerous -- i can tell you that there are numerous allies who are concerned about the indecisiveness. >> maybe you can get back to me with specifics. >> well, we do not give our sources to you and in his room. are you saying you have not heard any reports like that? >> specified -- any specificity that will not remove sourcing agreement you have with them? >> what are you concerned --

>> you post the question. i was asking for more texture with regards to -- >> are there any allies who have voiced concern -- >> i was wondering if you had more specificity on -- we can play the "jeopardy!"version on this -- >> well, i don't think i'm going to get an answer on this. leslie gelb, the foreign policy analyst, called the strip amateurish -- called this trip amateurish. >> i have not read mr. gelb's -- >> you are reading what everybody else has been reading -- >> the president set out to be engaged our foreign policy with asia after many years -- re-

engage our foreign policy with asia after many years of dealing with that area of the world on only one topic, terrorism. we understand that relationship with that part of the world is more complex than it just that one issue. the president went to asia to talk about the international economy and talk about human rights and internet freedom, as he did in china. and again, to greengage -- reengage our country with that side of the world. the president is quite pleased with the trip there. >> he had public at a time soviet something to bring home -- at homework ahead of time and he had something to bring home -- >> look, we have been absent for quite some time on the world stage. i did nothing at all of a sudden you are -- glad to elect are -- i do not think you will all the

sudden electing a new president and then -- diplomacy is hard work to do. i think the president is quite pleased with the outcome of the trip. >> does the president approve with some of the horse trading that has gone on with regards to health care? mary landrieu getting $300 million? is there anything unseemly about -- >> i think that is a better question for members of capitol hill. we are happy that progress is made. >> [unintelligible] >> that is better directed to the senate. >> beyond the stimulus, does the white house believe more should be done in terms of government intervention for job creation? >> i think the president and his team are evaluating different policies as to whether they can make a difference in helping to

spur job creation. you mentioned the recovery act. adding anybody would tell you that before we can create -- i think anybody would tell you that before we can create jobs, we have to let economic growth that is on the positive side of the ledger. last quarter, for the first time in four quarters, we actually had a positive growth. i think that as a precursor to a more sustained recovery. the team continues to meet and evaluate what proposals in working with congress might help spur job creation. >> there is a report that the white house is lukewarm on proposals that have been bandied about by house democrats. >> look, we are going to work with numbers of drivers to come up with sensible -- members of congress to come up with sensible and reasonable measures that might spur economic growth. this conversation continues. >> robert, i have only two.

only two. when before in u.s. history as an enemy combatant been tried in civilian court? >> i don't know what moussaoui -- i know both zacarias moussaoui and richard reid were both tried in federal court. i do not know whether their status was of enemy combatants. >> regarding senator durbin's hope that we can house guantanamo inmates in and underutilized illinois state prison, does the white house agree that this would bring badly needed jobs to the area, and that this prison could be used for illegal aliens? >> all the latter part, i don't know the answer to that print on the first part, this is a facility that was built under the auspices of housing prisoners in a town that is in need of economic developments.

i think there is no doubt that housing prisoners would create jobs. and i think that it would also help in a big way in closing down guantanamo. no final decisions on any of that have been made. >> thank you very much. >> yes, sir. >> is today's meeting where they will lock in a decision? >> i don't know the answer to that, mark. it may be tonight, and maybe the next several days. >> will there be a read a statement -- >> it is scheduled to go, i think an hour and a half. i will have to be looked at it myself. >> will you describe the process? he said it was complicated but is he anguished through this

process? >> i got the keys and wished to the process but i think the president understands -- i don't think he is anguished through the process. i think the president understand that there are a lot of different layers to our involvement in afghanistan, what its impact is on our forces, what its impact is on our fiscal situation. i think there are a host of things that go into making the decisions that the president is working through. again, understanding that there are about 30,000 more american troops in afghanistan now than there were when the president came into office. >> you said in response to a couple of questions that people were working -- [unintelligible] should i read into that that whatever the white house might be doing over the next few weeks or months won't find its way -- >> no, no, what i think i was

talking about was the budget -- just discussing jake's question on what has to be done a long term about dealing with the fiscal situation. >> would there be job proposals -- >> there certainly could be. >> also, what does the president think about a tax credit for job -- [unintelligible] >> i don't have the detail -- >> giving small business is primarily a tax credit in exchange for jobs pleaded. -- jobs created. >> i think that is one of the ideas brought up with the president's economic advisory board, and i think that and other proposals are being discussed on capitol hill. >> business economists came out with an economic report today -- does the white house believe that technically the recession is over? >> wendell, i will leave the

delineation of when it started and when it ended to the board of economists. >> -- > -- [unintelligible] >> that, my friend, would be some news. [laughter] that i am certainly and prepared to discuss. -- certainly unprepared to discuss pre i will send you bobs number. as if you all don't have it. >> the focus having been on elections for the most part, some critics say he does not have brought enough experience in legal matters -- >> look, i have work with bob for probably eight years. many of us have worked with bob for quite some time.

i think you can find, and you have found, democrats and republicans alike that believe that bob possesses certainly the knowledge, the experience, and the relationship with the president to do the important job of being white house counsel. the figure of tremendously fortunate that he has this -- i think we are all tremendously fortunate that he's decided to take a break from private practice to be white house counsel. >> there is a conservative group saying that a provision -- health care being debated in the senate would require the government to accumulate information about bru -- gun- related injuries, there are concerns that it might be used to impact on the loss -- impact gun laws.

>> i am not familiar with that provision could we can certainly take a look at that. >> do you know if he is planning not talking to the cabinet today and out afpak and the decision, talking within his thinking on this? >> i do not believe that is extensively on the agenda. i think they are preparing for that now and i can certainly ask when they come out of that if that was something -- obviously, that is something in certain members of the cabinet have been involved in and will be involved in later today, in the meeting itself, and also meeting with president and the discussion he will have. let me get a better sense when they come out of the meeting. >> on tarp, do you guys have a sense of the time of when you guys plan to make a decision and announce whether or not to proceed, and you have anything

about the conversations on the hill about different ideas of how you folks want to use the money? >> all i know is that i don't have a timeline on the decision. obviously, those are conversations -last week with members of the economic team. >> can i follow up on the question about the indian state dinner tomorrow night? i wonder if you could explain a little bit about the role of diplomatic and attending in the obama winehouse -- diplomatic entertaining in the obama white house. people may wonder if they see a black tie dinner and what i hear will be a lovely dinner, what the role of having a party like that is, given that some people might say that there are wars and the situation in the

country. can you explain why this happens and the way it will unfold? >> look, this is a very important relationship with a very important country that we have in the world. that is why india was chosen to be the first visit. i think that is why the white house wanted to have something as formal as this to discuss throughout this process the issues that we have bilaterally -- >> not about the party specifically, but 400 people -- >> the issues of, again, counterterrorism, of the economy, of energy and climate change, a lot of which we read about each day in the news, and obviously will be topics throughout the conversations that are had between the president and prime minister.

again, i think this is a show of respect for the values that we put on that relationship. i think india is the world's largest democracy, i think the relationship that we have with them and the issues we are dealing with them are tremendously important going forward in our future. >> the president last week said he would consider it a firing offense the people who have leaked information about his afpak position. is he serious about pursuing some type of investigation or inquiry into this? >> let me just leave it at this, jeff -- the president has on a few occasions in meetings like this talk about the importance

of being able to have an open discussion amongst his advisers as part of this process. he reminds people that we have these meetings in the situation room and not at a local restaurant because of the importance and the sensitivity of some of the information that is discussed throughout the those meetings. i think it -- i think the president believes strongly that being able to get the type of information you want, discussing the sensitivity of much of it, as well as being able to ask questions and get more information, is something that is important in formulating this decision and is important to do in a way that people feel confident that they can be candid with the american president. i have not talked to him about whether or not -- what specific measures he might have in mind to follow up.

i know in the interview he echoed what secretary gates had said in a previous interview about the same topic. >> back to health care -- is the president going to take a personal role in ironing out the differences? >> i do not think we would be at this point if the president had not played a role in getting this process to where it is. >> any public events that he as planned? >> i do not have the week ahead for next week, but i can assure you that he will continue to talk to legislators about the importance of this bill. >> should actually clear next week, is there any chance that this will actually be on his desk for signature this year? >> that is our hope. >> is it possible?

-- do you think it is possible? >> i do. as i said earlier, this is a goal the people had for seven years -- for 70 years. never been closer than we are now. we've never had a vote in the full house and the full senate. we will start debate next week in the senate. i think we are continuing -- the president believes we are continuing to make progress on a bill that will make health care more affordable for people that at it and provide increased accessibility for those who do not come provide important insurance reforms, as well as bend the cost curve and reduce the deficit over the next 10 years. >> but given the challenge of getting to this point, - -- >> david obey is against sending

more troops to afghanistan and says it could wipe out any initiative of rebuilding our economy at home. where will the president before and addition of troops -- pay for an additional troops and to you think that that jeopardize this in some sense his domestic agenda? >> paying for it, we will wait for a decision to be made before we get to that point. second, this is an issue that the president has talked extensively about during the campaign, the need to focus our attention on the dangers of afghanistan and pakistan. the presidents don't get to decide what issues ultimately get to their desks. the president understands that

the war in afghanistan was one that he was always going to have to deal with, i don't think that in dealing with that is an issue that threatens the president from not being able to deal with a very important issues like the economy, like health care, and many other things that are either part of his agenda or might not be planned but end up on his desk anyway. >> just on the jobs question, does the deficit constrain the scope and ambition of any jobs program that might be put forth? >> again, i would reiterate what you heard the president say in interviews he did last week, that in many ways we have a dual challenges. in order to deal with the deficit, one of the most important things that we control going forward, or have some input on going forward, is an economic recovery, that we

should not shy away from doing what needs to be done to continued economic growth and to spur job creation in the future. at the same time, we have, in the medium-term and long-term, fiscal issues that have to be dealt with. the president has had to balance this come in all honesty, since the first day of his administration. i have no doubt that it is a balancing act that will continue to move forward. >> just to follow up on this question of whether leaks are a firing offense, does the president feel that it is only with the pentagon or with the white house, also? >> i do not think the president discriminates from where the person sits. >> he has made no indication about whether he wants to find out -- >> i have not talked to him post

that interview about that. david? >> on the issue of the copenhagen summit, is the president disappointed that it looks like there will not be any treaty with any binding commitments? does he feel that the united states and other nations of the world have failed when the goal was to come up with a treaty that actually had binding commitments rather than just setting the goals for those -- >> first and foremost, i think that getting a political agreement out of copenhagen after years and years and years of inaction on clean energy and climate change the president would view as a very positive development. david, i don't think any of us were under the illusion that, again, having been off the world

stage for so long in dealing with this issue, and understanding what was going to take to get developing nations of the world at the table, that all these issues might be me be wrapped up -- neatly wrapped up by december of this year. i don't think that has cost the president not to act berry obviously, the house has taken action, the senate is and the process of moving forward on clean energy and climate change legislation, and i think the president is going to spend his time focusing on what we can get out of copenhagen in terms of binding political agreements moving forward. >> do you think he has to ramp up his efforts at home here to get something out of the senate? >> i think the president has certainly spent time on this issue in dealing with members of

the senate. again, go back to my health care analogy -- we had an issue that had been something that scientists had talked about for quite some time, is through half of the process of getting the house to agree on a bill. we understand that is not all of what has to happen, but it is certainly a good start after years of not dealing with the issue. >> understanding the scope of what the president is dealing with in these meetings, and within his administration, at the end of the day, could this actually happened that the president actually says, "at this time, i choose not to have additional troops sent into afghanistan"? >> again, there are a plethora

of decisions that could ultimately be the outcome of this. i do not want to preview what it might be. i will wait for him to make that decision. >> but is that a viable -- g>> i think there are lots of options on the table. >> the gao report last week talked about only 78% -- 78% has not been spent out of the stimulus this year. first of all, why was it rushed through -- >> why was what rushed through? the gao report? >> no, the stimulus bill rushed through 170% of the money was not going to be spent. -- when 78% was not going to be spent. >> i don't consider that time wasted.

to be honest with you, i don't know whether -- i assume that the measure you are looking at is final money that has gone out the door and does not include obligated money, which allows, for instance, on a road project, the check my not come until the very end, but that does not mean that the money cannot be agreed to, obligated, and the effects with construction co. as well as the indirect jobs ultimately created as part of that -- that money has been spent. i can get you an updated figure, but i think more than 50% of the money has thus far been obligated. >> also, if i could follow up, there was talk of nearly 4000 jobs -- 50,000 jobs were

created, and also, in a case where $1 billion was allocated, there were no jobs creed. -- no jobs created. >> obviously, there has been an unprecedented amount of transparency in fault and in the recovery act, all like what we have seen -- invovled in the recovery act, unlike what we see in any legislation before it with the rewards and contracts on the internet, as we said, there were bound to be some errors. what is indisputable, if you ask economists as the bill had a positive impact on our economy and our economic growth -- the only factors that i can point to are the gdp of the previous four quarters -- again, remember, the first quarter of this year, i think the revised

figure was -5.9%. the initial estimate for the third quarter of 2009 was + 3.5%. i am not even good at math and i know that is a pretty big variance in terms of an economy that is contracting and an economy that is growing. a lot of people are rightly concerned about the employment. i don't know of an economic model where an economy that is contracting, particularly at a quarterly rate that is almost 50%, is adding jobs. in fact, in that period of time, we had once were 741,000 jobs were being lost. the president and congress took the necessary action to institute a recovery act that has helped spur our economic growth, has led to the first

positive gdp growth in four quarters, and, again, you are not going to create jobs in this economy in a scenario with negative to job growth. we are on the road to the recovery. thank you. >> the prime minister of india is visiting washington, d.c. this week. prime minister manmohan singh will discuss india's foreign policy. live coverage starts at 5:00 eastern here on c-span. -- 5:30 eastern here on c-span. tomorrow, president obama hosts a state dinner for the prime minister. coverage begins at 9:00 eastern. tonight, net neutrality, the

wireless spectrum, and improving broadband service in the u.s. federal communications chairman julius genachowski lays out his goals on "the communicators," on c-span2. "the new york times" reports that the national football league is changing its policy on players' concussions. comes after a house hearing on the issue. you can see that hearing tonight at 9:15 eastern on c-span. president obama addressed the subject of math and science education at a white house event earlier today. he talked about his recent trip to china and the investment that country is making an education. also includes a demonstration from students from virginia's oakton high school. this is about 20 minutes. gfgfgfgfgfgfgfgfgfgfgfgfgfgfgfgf

gfgfgfgfgfgfgfgfgfgfgf >> ladies and gentlemen, the president of the united states. [applause] >> thank you. thank you so much. thank you, everybody. thank you. please, have the seat. .

>> and the nasa administrator is in the house. the nsf director is also here. my science and technology adviser is right there. millibarmelody barns, the domesc policy director. then we have some students from some wonderful schools. oakton middle school, washington mathematics public charter high-school from d.c., and the herndon high school from herndon, virginia. welcome, everybody. [applause]

the students from oakton will be demonstrating a moon rock cannon. i believe that robotics can inspire young people to pursue science and engineering. i also want to keep an eye on the robots in case they try anything. [laughter] it is an honor to be here and to be joined by the first american woman in space. sally ride. [applause] she has inspired a generation of boys and girls to set their sights higher. i want to thank nasa for providing the interactive globe to teach young people about our world. i want to welcome smmyth

busters from the discovery channel. [applause] i hope that you left the explosives at home. [laughter] finally, allow me to thank the many leaders here today who have agreed to be part of the historic effort to inspire and educate a new generation in math and science. we live in a world of unprecedented perils but also unparalleled potential. medicine can find new cures, but it is attached to a health care system that is bankrupting our government. we confront threats to our security that seek to exploit the openness that is essential to our prosperity. we face challenges in the global marketplace that affect people

at all levels. it is an economy where we all share opportunity but also share in crisis. the key to meeting these challenges to improving health and well-being, pressing clean energy, protecting our security, and succeeding in the global economy will be reaffirming and strengthening america's role as a world in june of scientific discovery and technological innovation. that leadership tomorrow depends on how we educate our students today, especially in the fields that hold the promise of producing future innovations and in of the tours. that is why education in math and science is so important. for decades, we have been losing ground. one assessment shows 15-year-old now rank 21st in science and 25th in math when compared to their peers around the world.

we have seen statistics like this for years. we've let partisanship and bickering stand in a way of progress. we've let our children down. we are here because we all believe the cannot allow division and indifference to imperil our position in the world. it is time for all of us to take responsibility for our future. i am committed to moving our country from the middle to the top of the pack in science and math education over the next decade. to meet this goal, the recovery act included the largest investment in education in history while preventing thousands of educators from being fired because of budget shortfalls. under the leadership of arne duncan we've established the race to the top fund. it is one of the largest investments in education in

history. states will not just receive funding. they will have to compete for it. producing innovative programs in math and science will be an advantage. we're challenging states to improve achievement by raising standards, is using data to better inform decisions, and taking a new approach is to turn around struggling schools. a great teacher is the single most important factor in a great education. we are asking states to focus on teacher effectiveness and make it possible for professionals to bring their experience and enthusiasm into the classroom. you are here because you know that the success will not be attained by government alone. it depends on the dedication of students, parents, and the commitment of private citizens, organizations, and companies. it depends upon all of us. in april at the national academy

of sciences, i issued a challenge to encourage folks to think of new and creative ways of engaging in peopl and -- engaging young people in science and engineering. today, we are launching the educate to innovate campaign. it is a nationwide effort to help reach the goals this the administration has set of moving to the top of science and math education in the next decade. we have leaders from private companies, universities, foundations, nonprofits, and organizations representing scientists and teachers from around america. investment in this campaign is more than $260 million. we only inspect the campaign to grow. leaders from major companies are teaming up with the gates foundation and the carnegie corporation to replicate

successful programs across america. "sesame street" has begun an initiative to teach young children about math and science. discovery communications will deliver interactive content to 60,000 schools reaching 35 million students. these efforts to extend beyond the classroom. time warner cable is joining with the coalition for science after school and first robotics, a program created by an inventor, to collect 1 million children with a bunt after- school activities like robotics competitions. industry leaders are launching a nationwide challenge to launch a compelling and freely available sites related video games. organizations representing teachers, scientists, mathematicians, and engineers are joined by volunteers in the committee to participate in a grassroots effort called national lab day to reach 10

million young people with learning. they will construct miniature windmills and get their hands dirty. they will have a chance to build, create, and maybe the strike a little bit to see the promise of being the makers of things and not just the consumers of things. the administration is participating as well. we've had a number of science focused events which young people at the white house. that included astronomy night a few weeks ago. the national science foundation and the department of energy have launched an initiative to inspire tens of thousands of students to pursue careers in clean energy. today, i am announcing that we will have an annual science fair at the white house with the winners of national competitions in science and technology. if you when the n.c.a.a.

championship, you come to the white house. -- if you win n.c.a.a. championship, you come to the white house. scientists should be recognized for achievements as well. scientists should stand side-by- side with athletes and entertainers as role models. we will lead by example. we will show and people help cool science can be. we will expand the scope and scale of education across america. we will expand opportunities for all young people, including women and minorities who have been underrepresented in scientific fields but who are no less capable of succeeding in math and science and pursuing careers that will improve our lives and grow our economy. this is only the beginning. we will challenge the private sector to partner with community colleges to help train the workers of today for the jobs of tomorrow.

we will make college more affordable. by 2020, america will once again lead the world in producing college credits. we cannot let the students off the hook. the success of the campaign depends upon them. i strongly believe the young people will rise to the challenge if given the opportunities. we have to work together to create these opportunities. our future depends upon it. i want to mention the importance of students and parents. i was in asia for a week. i was having lunch with the president of south korea. i was interested in the education policy that they have grown enormously over the last 40 years.

i asked about the biggest challenges in the educational policy. he said the biggest challenge is that the parents are too demanding. he said that even if someone is dirt-poor, they are insisting that their kids are getting the best education. he said he has had to import thousands of foreign teachers because they are all insisting that korean children have to learn english in elementary school. that was the biggest education challenge he had. it was an insistence and demand from parents for excellence in the schools. the same thing was true when i went to china. i was talking to the mayor of shanghai. i asked about how he was recruiting teachers. the have 25 million people in this one city. he said they did not have

problems recruiting teachers because teaching is so revered. the pay scales for teachers are comparable to doctors and other professionals. that gives you a sense of what is happening around the world. there is a hunger for knowledge and an insistence on excellence. there is a reverence for science and math and technology and learning. that used to be what we were about. that is what we will be about again. not once was i asked about education policy by the press during my trip. often these things get short shrift. they are not what is debated on cable. this will make more of a difference in determining how well we do as a country than just about anything else we do.

everyone in this room understands how important science and math can be. it goes beyond the facts in a book or the answers on the quiz. it is about the ability to understand our world, to harness and train the human capacity to solve problems. it is a set of skills that informs the decisions we make throughout our lives. improving education is about producing researchers and scientists who will transform our lives for the better. it is also about expanding opportunity for all americans in a world where education is the key to success. it is about an informed citizenry. many of the problems we face as a nation are at the root of science problems. science can unlock new discoveries and and moccasins a promise in the minds of our young people.

with hard work, with effort, they have the potential to achieve extraordinary things. this is a difficult time in our country. it would be easy to grow cynical and wonder if our best days are behind us, especially during economic uncertainty. we have seen so many from maastricht to washington fail to take responsibility for so long. we have an opportunity to move beyond the failures of the recent past and recapture the spirit of american innovation and optimism. this mission was not built on greed, reckless risk, or short- sighted gains or policies. it was forged of stronger stuff, by old men and women who dare to invent something new or improved something old. it took the chances of big ideas. they believed that in america, all things are possible. that is our history. it remained fixed on the work ahead and build on the progress

we have a today, this will be our legacy as well. with that, as proof of the extraordinary promise of american young people, i would like to invite steven harris from oakton high school appeappear to show s what they have invented. give them a round of applause. [applause] what do we have here? >> we are about to compete in a competition. [laughter] the object of the game is to shoot the ball. the other robot catches it. >> we designed this robot to

[inaudible] and be able to shoot them back. [laughter] [laughter] >> what are they came out right now? -- what are they aiming at right now? [clicking noises] [laughter] >> how long did it take to build this? [laughter] [applause] >> the prime minister of indian is visiting washington this week. he meets this afternoon with the

council on foreign relations. the prime minister will discuss indian foreign policy. live coverage starts at 530 eastern time here on c-span. tamara, president obama will host a dinner for the prime minister. c-span will have the preview of the dinner, arrivals, and toasts. coverage begins at 9:00 p.m. eastern. -- coverage begins at 9:00 eastern. the fcc chairman maps out his goals for the agency on "the communicators." the national football league is changing its policy on concussions. it comes after a house hearing on the issue. you can see the hearing tonight on c-span.

>> thanksgiving week, a look at politics in america from the bipartisan policy center. topics include next year's midterm elections and a look ahead to 2012. the role of the media and assessing the obama presidency. on tuesday night, president obama welcomes the indian prime minister. there will also be three nights of original c-span documentary's, beginning with the supreme court on thursday night. >> the postal service announced $3.8 billion in losses for fiscal year 2009. the postal service officials testified before a house oversight subcommittee this month on efforts to decrease future losses. stephen lynch of massachusetts is the chair. this is about one hour and 45 minutes.

>> good morning. the hearing will now come to order. i want to welcome all of those in attendance. the purpose of the hearing today is to examine the steps the postal service has taken and plans to take since congress passed the postal accountability act. i will try to keep the acronyms to a minimum. they are to use the increased flexibility to grow revenue. we're here to discuss barriers

or limitations to the postal service innovations. [buzzer] we will also discuss the lessons that can be learned in this area. the ranking member and chairman will have five minutes to make statements. i will yield myself five minutes for my opening statement. in the hearings the subcommittee has held on the postal service this year, discussion has tended to focus on the bottom line or cost-cutting and consolidation efforts and rightfully so. the past few fiscal years have presented a significant financial challenges for the nation's mail system. this committee convenes not to discuss what they have been doing to reduce expenditures, but more to learn about what the

organization is doing to grow revenue and value as an ongoing effort to bring arounabout fiscl turnaround. the landmark act as been passed. we look forward to hearing what has been done to grow the business under the new flexibility afforded to the postal service in 2006. first, and must briefly acknowledged the financial reality before us. the puzzle service expects a net loss of approximately $7 billion for fiscal year 2009. that is prior to accounting for the recent legislation in the form of a $4 billion deferred payment to the retirement fund. i am glad we were able to defer a portion of the fund that allowed the organization to meet its financial obligations and

improve its cash position. however, the relief measure was only a temporary solution to long-term problems. this was not a bailout. many americans think the postal service is largely supported by government dollars. it is not. i want to stress that the postal service is over 99% supporting -- self-supporting. less than 1% of the funding comes from the government. until the reform, it operated under the break-even mandate that prevented the organization from eativen making a profit. i am trying to stay away from the acronyms.

the postal accountability and enhancement act. the postal service is now permitted to operate more like a business in terms of profit earning and product of versification. and look forward to hearing from the witnesses about how they've attempted to grow the business. the hearing today is intended to examine the steps the postal service has taken and the results achieved so far. looking to the future, the postmaster general recently described several initiatives they are interested in it to diversify and grow revenues. he observed the postal service has more retail outlets in the united states then mcdonald's, starbucks, and walmart combined. he proposed the should be permitted to offer customers

alternate services like banking, insurance, and telecommunications. i am interested in hearing the extent to which these ideas have been vetted as well as the risks devaluing to. i have asked the witnesses to address the lessons that to be learned from foreign post. i know that some offer banking services and sold mobile phones. i know several companies -- countries have privatized their services. aware subcommittee will continue to provide oversight of the service including an in-depth examination of the business model to help determine the long-term changes necessary to help it return to financial viability.

the postal service needs to move forward with its efforts to grow revenue and increased the value of the malil. thank you for being with us. i look forward to you. his patient. i yield for five minutes to the ranking member. >> my comments will be brief because we came to listen and hear from the panel. let me echo the sentiments the chairman articulated. i think he has it right. we will spend time and attention talking about cost cutting measures. at the end of the day, we need to increase the relevancy of the postal service for it to thrive and serve the citizens, we need to increase its relevancy. at the same time, there needs to

be cautioned to make sure we're not tripping on top of the private sector. there could be unintended consequences competing in a space that may be best left to the private sector. the postal service under the constitution has a unique place in this country. i would like to see us do more. one thing i think we should pay attention to is the cross- functionality that we can take advantage of with other segments in government. i would like to see as pursue the conducting of the u.s. census. they give us $14 billion to executed. we have real estate and able people. i think that is something we should pursue. what are the things we can do with fema and other agencies that need the kind of resources

uniquely provided by the postal service? and it forward to your comments. i appreciate the chairman's approach on this as well. i hope this is the start of a series of dialogues about the potential impact in increased relevancy for the postal service. i yield back the balance of my time. >> thank you. a gentleman has recently arrived. i like to yield five minutes to the gentleman, mr. conley. >> this is precisely the type of process which should be conducting to determine the changes that will enable the postal service to try in the future. we should be wary of short-term cost cutting that could reduce market share and revenue in the future. it would be preferable to

examine changes that would enable the postal service to augment existing sources of revenue. i am pleased they are examining 15 potential new revenue sources. these changes should not be limited to marginal changes. perhaps it would be possible for the postal service to work with community banks to integrate banks and post offices that would help both the banks and the postal service. the goal of exploring new options should be to preserve the outstanding services offered by the postal service. we all benefit from affordable and convenient mail delivery. the ability to deliver mail six days a week also creates opportunity for businesses to rely on it for advertising. if the postal service did not exist, there is little doubt the market would have oligarchic

characteristics. it continues to play an important role in limiting the prices of sending packages. that helps all consumers. it also makes an important contribution to our economy. those who work for the postal service generally earned high union wages. during the bush administration, the median wages for families fell during a full economic cycle. protecting high-paying blue- collar jobs like those in the postal service must be part of the broader effort to help the economy recover. thank you for holding this series of meetings on the long- term viability of the postal service. i look forward to sharing from the panel. >> the chair now recognizes the gentleman from maryland for five minutes. >> think ank you for holding ths

important during on adapting the post service to our changing world. the u.s. postal service is the second part largest civilian employer with approximately 623,000 career employees. consumers rank it as one of the most trusted government agencies. it continues to excel. the post office has not been immune to the downward economic trends this information. final numbers are not available yet but it is estimated that the post office will experience $6 .2 billion loss that is more than two times last year's loss. this can be attributed largely to two factors. one is the unprecedented decline in mail volume because of increased use of electronic communications.

two, the economic recession is affecting all sectors. the postal service has been making a number of aggressive, cost-cutting measures. i am interested in hearing about the new ideas our panelists will present today. the postal act was signed into law in december of 2006. it allows for flexibility in how services are designed, priced, and marketed. because of that flexibility, the post office has been able to create new, innovative programs like the standard pricing program this past summer. it provided a rebate to eligible mailers of letters of volumes above a specific tertial. this is estimated to generated at least $50 million in sales. the postal service has also

restructured its website and create mobile device functionality for customers. this allows greater accessibility and convenience for postal users. for 44 since, we can send a letter anywhere in the united states. -- 44 cents, we can send a letter anywhere in the united states. it is reliable and a great body. i look forward to the discussion on expanding products in partnership with private entities and what congress can do to help the postal service. i yield back. >> into. -- thank you. the chair recognizes mr. davis

from illinois for five minutes. >> let me echo the sentiments already expressed by my colleagues in thanking you for calling this meeting. i think the postal service is one of the console elements of our communication system that must be seriously addressed. i am interested in hearing about the efforts that been put forth by the postmaster general and his staff and the other entities associated with making sure we maintain the viability of operations. we're facing the impact from electronic communications and the other economic indicators upon us. we recognize it is no easy task.

but there are no simple solutions to complex issues. i want to commend you for your leadership as chairman of the said committee -- of the subcommittee to ensure that postal operations will continue as bible instruments of our communications system. thank you very much. i look forward to hearing from the witnesses. >> i thank the gentleman for his kind words. it is the custom of the subcommittee to swear in witnesses before they provide testimony. please stand and raise your right hand. do you solemnly swear the testimony you will give will be the truth and nothing but the truth? let the record show that all of the witnesses have answered in the affirmative.

i would like to offer a brief introduction of the panel of witnesses. mr. burns stotock was assigned n 2008. he is responsible for commercial products, including commercial sales and services. he has extensive senior leadership experience in business. our next witness has served the agency since 1998. she is an experienced public affairs professional with expertise in citizen participation, consumer issues, urban planning issues, and the milling industry. -- and the mailing industry.

mr. michael coughlin is a recent retiree from a global outsourcing firm. he helped to manage senior level relationships with postal plants around the world. he also spent 32 years with the u.s. postal service serving as deputy postmaster general and member of the board of governors from 1987 until 1999. mr. phil hae the directorre of the accountability office. he has used a broad range of domestic and international concerns. his portfolio focuses on programs of the postal service and the department of transportation. mr. robert eisner is president and ceo of transformation strategies. he has been a management consultant for more than 20 years. he specializes in market transformation. he previously served in executive positions at the postal service, including vice- president for strategic planning until 2001.

we will now begin the witness' testimony. >> [no audio] >> could you pull the microphone closer? thank you. [no audio] >> sir, i think your folder is blocking the -- pulled up forward. -- pull that forward. >> take it from the top. [laughter] >> good morning. i appreciate your interest in the revenue generation activities at the post office. i would like to begin by

recognizing the support of the postal service this year, especially your understanding of the urgency of changing the retirement fiscal structure. the postal service continues to face challenges. auditors are reviewing the 2009 financial. i cannot give precise figures, but i can say that despite heroic reductions, we expect blogging to votdecline for a net loss of over $7 billion there is no certainty that the volume levels will recover. we think the potential exists for similar financial losses in the future. we're involved in ongoing efforts to correct postal service finances. the first approach is to aggressively bring down costs.

the postal service has had aggressive cost-reduction targets. the change in frequency from six days to five days and modification of retiree fund payments are interval parts of the strategy. to be equally aggressive in our efforts to grow revenue and change the law to provide greater pricing flexibility is important. example of how we utilize pressing freedoms is the standard mail summer sale. we offered a 30% price discount on advertising mail volumes for three months of the summer. we're still evaluating the program. preliminary information suggests that over 400 customers participated and sent large proportions of mail to stimulate the economy. and like to thank the prc for

its quick review of this. the priority mail campaign and consumer products at retail are all under way and taking advantage of the flexibility afforded by the flexibility act. some have generated incremental revenue. others are just hitting the market place. additional initiatives are in my testimony is still in the planning stages. they're designed to extend or transform business. three examples are renewed approaches to product distribution, the extension of the moment services cost to sickert credentials, and the exploration of hybrid mail. purpose of the hearing is to examine the constraints that hold the post service back. i outlined specific requests for changes to the lot in my written testimony.

that includes the authority to provide authority to state and local authorities. it will provide more freedom to leverage existing assets, especially retail. i am excited about the revenue generating projects and potential for greater freedom. i want to be clear that revenue alone is not sufficient to close the earnings gap. even at a 15% pre-tax profit margin, it would take profits generated by almost $45 billion in new revenue to fill the earnings gap. these four things are necessary to allow the postal service to fulfil its obligation at the levels of service the country has come to expect. we are proud of our accomplishments in meeting the needs of the country. without the help of congress, we cannot close the significant profitability act and meet our universal service obligation to

have i would like to thank the subcommittee for holding the jurhearing and reaffirm my commitment to the postal service. i would be pleased to respond to any questions you may have. >> thank you. >> good morning. i am pleased to be here today. the subcommittee as a critical role to play in preserving a treasured american asset. the postal service connects every american household, business, and institution through the universe of network is part of our daily life that is taken for granted until taken away. it supports the fabric of the nation and its institutions. converses played an ongoing role in revitalizing the postal

system, most recently through the paea. it was enacted at a time when both the economy and postal service appeared strong. the landscape has changed. i think it is working, but it is hard to see how well given the recession. there have been clear successes. the commission and postal service have worked to take advantage of competitive flexibility in the law. the postal service as used pricing power to significantly increase the return on the competitive product line. mr. mr. bernstock provided the details. there's also the first and only experimental product support -- submitted under the paea. preliminary data on revenue

generation activities indicate overall results have been positive but modest. the majority of the efforts involve price discounts. the result in limited additional revenue and provide less contribution to overhead. the commission would like to see more progress being made, particularly in the experimental area. there has been a reasonable effort extended to use the new law. the truth is the powerful downturn in the economy has caused a sharp contraction in keep mailing industries -- in key mailing industries. there's a difference between the annual decline and a 13% drop in volume experienced this year. the postal service cannot make its payment to the retiree health care benefits fund. it received $4 billion of relief from congress. for the immediate future, the

situation appears likely to continue. the postal service has suggested it needs additional freedoms modeled on the examples of foreign posts. we believe any trickthey need tt american experience and tradition. there may be some activities that that the american model. there is no magic bullet. any new business activity should meet specific criteria based on the core mission of the postal service, the needs of society, and the expectation of a positive outcome for both. the rationales that others are doing it does not satisfy the criteria. the postal service has directed most management resources toward reducing cost this year by more than $6 billion. the cuts continue. from adjusting rows and renegotiating purchase agreements removing collection sites. the postmaster general has asked

to lift six-day delivery. service cuts made to address near-term difficulties may have long-term consequences. from a market perspective, it could harm its greatest strategic advantage. that is its ubiquity. congress may wish to amend the act. the annual payment of $5.5 billion is an enormous burden. additional studies found at significantly lower payments by the postal service could still meet the head--- original funding objectives. recalculation would be timely. it would capture the sizable work force reduction. it would provide breathing room. it would provide resources for new initiatives and capital investments for better long-term planning. the postal service currently provides a number of non-postal

services that could generate new revenue. it processes passports for the state department. agencies that issue permits could partner as well. the america the beautiful passes sold by the park service is one i have been advocating in particular. considering our energy priorities, the postal service has the nation's largest civilian vehicle fleet. it could provide the critical mass needed to develop transformational technology and infrastructure to meet national energy goals. research indicates that postal delivery routes are well-suited to electric vehicles. national investment and a new fleet for the postal service would speed transformation, at green jobs, and reduce the operational overhead. we have confidence in the value of the mail. it is important to our economy and society.

we believe they serve a vital role and our community. how well the mail comes back may well depend on how deeply the service is cut now. that concludes my statement. i would be happy to answer any questions. >> thank you. mr. coughlin, you are recognized. >> the chairman introduced me earlier. i am michael coughlin. i am not here representing any particular organization or group. i have spent over 40 years in the postal industry. i spent 32 years with u.s. ps and the last 10 years had been in a consulting role primarily focused on foreign posts. i have been asked to share my perspective on the revenue generation efforts of foreign posts and the lessons we might take from those.

my statement touches on the range of initiatives undertaken by foreign posts and summarizes the varying levels of success they have had. i will not rehash those here. let me get right to what i think the common success factors that some of these posts have had in raising alternative revenues and some of the lessons we can glean from them. i looked at 15 different postal organizations around the world and their revenue generation efforts. i see fo common managementru -- i see four, and management -- ic common management characteristics in the most successful. this includes real clarity around strategic direction and a narrow focus on the markets they want to target. they know what they want to do and they do it. there is a strong innovation agenda in these organizations

and a forward looking culture that embraces change. in those organizations, innovation is an expectation. these generally have the ability to recruit the top talent. many of the key players on the revenue generation side come from outside the traditional postal experience. one other common factor is that they tend to focus on the customer experience and making that as positive as possible. whatever they do, they strive to do better than the competition. these are the four common characteristics. these are largely created by the management themselves. for the most part, i think these are generally within the current capability of u.ssps.

every bit as important to the success is the set of conditions that the governments of these and put in place. there are three critically important conditions they have in common. the legal framework within which they operate provides complete commercial freedom of action to operate in a competitive market. they operate very much by private entities in their country and this country as well. the regulators usually have a light and supporting hand. their primary focus is generally on universal service issues, the reserved areas, and the generation of competition in the local post a markets. third, there is little political interference in the basic business decisions they make, provided they operate within the

legal framework they have been given. in my judgment, these are the fundamental success factors for those posts. they generally have solid leadership and and effective governing structure. what does this mean for usps? i think there are two other important factors to keep in mind. the first of these is scale. i do not want to discourage anyone, but the problem usps basis today is made in billions of dollars. finding new sources of revenue is important. think about it. 1000 projects worth $1 million each will generate $1 billion.

make it 10 projects worth $100 million. that may not be enough. the recent reform law provided additional flexibility but i have not heard of any initiatives approaching anything like that. i do not say that to denigrate what the postal service and its colleagues have tried to do. but to have a real impact in this area, it is going to take some different and bake thinking. the second issue is every bit as challenging. unlike most of the posts i have discussed today, in the u.s., there is a very strong philosophical aversion to a government entity competing in private markets with goods and services already available from private sources. in the past when usps has attempted to offer such services, there has been strong and weak resistance. eventually, usps hears from some

of you. i personally experienced that. i do not see that situation changing simply because the postal revenue problem is bigger today. given this latter challenge, whatever revenant initiatives undertaken outside the traditional arena will probably have to involve partnerships and alliances with private entities were both parties can leverage the strength of the other. in the case of a usps, it has enormous geographic reach in its retail network. they touched virtually every home in the country for their delivery network. some opportunities might include expanded financial services availability, expanded delivery options, government and agency services, or a link between the physical presence of the usps and emerging technologies and services. after hearing the postmaster general's october 8 speech at

the national press club, i could imagine that some bankers in this country were bristling when he answered a hypothetical question in his speech about what new business he would like to be in by saying he would like to be a bank. >> mr. coughlin, you need to wrap up. we are way over on your time. >> perhaps the bankers are to put their innovation hats on and try to imagine how they can capitalize on what it usps has to offer. the same goes for other organizations looking for new ways to engage customers. what have we learned from foreign posts? i think we have learned that what they're doing is interesting but not terribly applicable to the usps. thank you. >> chairman lynch, ranking members, and members of the

subcommittee, i am pleased to appear to discuss the postal service revenue generation initiatives. i will provide an update on the postal service's financial condition. i will discuss revenue changes since the enhancement act of 2006. third, i will outline actions taken to increase revenues since 2006. fourth, i will discuss issues related to generating new revenues. the preliminary financial results for 2009 going forward is first. revenue declined from about $75 billion. action was required to reduce the mandated retiree payment by $4 billion. outstanding debt increased to $ billion. it will reach the statutory debt limit in fiscal year 2011.

deficits over $7 billion are predicted in 2010 and 2011. with regard to revenue generation in key postal products, gave greater pricing flexibility. market dominant is generally subject to an inflationary price gap. competitive products are not subject to that, but each competitive product must cover cost. prohibited the postal service from offering new products and services. turning to the actions taken, the service increased average rates at virtually the maximum allowable under the price gap. three targeted rate incentives were provided to stimulate mail volume. a summer sale was introduced for standard mail. there is an incentive program for saturation mail.

there were annual increases for priority and express mail in 2008 and 2009. volume discounts were introduced as well as the flat rate box. the postal service as injured in to about 90 contracts with large mailers for other products that are generally volume-based. with regard to increasingeneratg increased revenues, we're asking them to change the locks of that they can move into areas like banking, insurance, and non- postal vehicle services. the analyzed former efforts. the loss in the 1990's on 19 new products. in 2001, we reported that none of the electronics initiatives were profitable. the postal service's interest in

moving into new lines raises several fundamental questions. should the postal service compete where there are already private-sector providers? should anti-trust and consumer protection laws apply equally to the postal service and its competitors? if the postal service were to compete in banking, insurance, and retail services, should be subject to the same regulatory entities as competitors? . . although it has used flexibility, the results are

linked to the economy. the postal service has no business proposals for entering new markets or knowing what legislative changes would mean needed. generating new products -- at the same time, what -- much more work remains to be done. mr. chairman, this concludes my statement. >> thank you, sir. you're welcome for five minutes. to me ask you to put your microphone on? >> thank you, mr. chairman. in my statement, i explain why i believe the postal service and the mailing community can become a source of innovation and new post revenue for public/private

partnerships that were encouraged by congress and section 10 of four of the postal accountability and enhancement act. there is a broad consensus that bold action must be taken to reinvigorate the postal system and there are real and tangible opportunities to create new value for postal customers. to be clear, let me offer few examples that might be called enabling the last mile, extending democracies reached, and promoting green routes. by enabling the last mile, i refer to the many opportunities that exist for putting technology in hands of the letter carrier. in other words, on the doorstep of the postal consumer. one of the areas of greatest interest has been wanting to know where their mail is while it is on route to his destination. the usps was seen as a black hole compared to others who have invested billions to enable their higher in services to

track and trace mail products. this is going to change eminently because the postal service's on the verge of creating a smart grid of intelligent mail services. now we can go beyond the bar code and offer tracking technologies that have exciting possibilities for adding new value for customers. what is more, we can download applications to this scanner technologies that is finally within the last six months in hands of the letter carriers. customers can realize new tangible benefits and new postal revenue can be created. but to make this happen, we need to collectively create an innovative enterprise of tests and trials and partnerships. a second broad theme that chairman ruth goldway has championed his vote by mail. the postal service can do this and can provide many other

government services as well. to be practical and secure, it will require connecting hard copy services to internet services, and that will necessitate partnerships. but the opportunity to expand the capacity of the postal service, to continue to serve as democracies agent, it is here. and third, there are opportunities for the postal service to again serve the nation by carrying parcels that today because three or four trucks to travel the same route. we can reduce carbon emissions by creating green postal routes. this will take some re- engineering and perhaps some recognition under cap and trade. but there are new opportunities here if we seize them. in conclusion, i did not invent these ideas. they came from the community, from the mailing community, from a letter carriers who have said, why not? they come from created mailers

-- created mailers and suppliers. to attack this -- to tap this creativity, when the internet was a future vision, mines have to be changed. it is time to say, that was then, this is now. in the future, innovation is going to come for collaboration and partnership with the postal service does what it does best and where the private sector through partnerships provide internet services and makes mail relevant to the consumer of the future. if we make the modern postal services relevant by connecting them to a multi challenge -- multi channel internet market -- marketplace, they will generate more mail. this is the real revenue opportunity in tailed and what we're talking about here today. the coming years could be an exciting time of transformation or they can be a train wreck. the difference will be whether

there is clear public policy guidance they can define the difference between the creative balance of what should be public and postal, and what the private sector can do best. thank you very much, mr. chairman. i look for to answering any questions. >> thank you. i yield myself five minutes for questions. mr. bernstock, i do appreciate your honesty and your statement that we're not going to solve this on the revenue side alone. i think that is apparent just by the numbers. in 2008, we saw mail volume go down 9.5 billion pieces, and then in the fiscal year off -- ending october 1, 2009, we saw a drop 26 billion. there is no way in the near term

that we can turn the system around and saw that problem by selling more green cards or any other service that we might be capable of doing right now. and at the same time, we are a little bit disappointed appear with the consolidation effort and cost saving side. it does not appear that the original target of closing 1400 facilities is anywhere near probable. i think the post office has reduced its consolidation numbers to below 400 now. it will not merely capture the savings that we thought were possible. and the early retirement incentives -- not great incentives, but the programs themselves have not gleaned the top of utilization on the part of the employees. so we still have a lot of people

that are resisting an early buyout. we have a large work force. understandably so, those workers, their 401(k)'s are cut in half. they do not want to retire in eight environment like this. but we need transformational leadership. we need a truly dynamic change at the post office, the way that we do business. there's a saying that says, there is nothing more disruptive to the human condition than the pain of a new idea. and unfortunately that is what we are facing. i love my postal workers and i will be the first one to amend it. i do not want to see layoffs or any of that. i am trying all of these other measures to protect the employees, because quite frankly, when we grade consumer satisfaction among the federal agencies, the post office,

because of the work of their clerks and the work of their mail handlers, because of the work of their letter carriers they go to every home and business and america's six days a week, by far they are the highest rated federal agency that we have in america today. they do the best job. so i think it would be on this targeting of our problem to look at the backs -- a mistargeting of our problem to look at balancing this on the backs of our postal workers. following the post office for the postal accountable and enhancement act to branch out into these other areas -- i know that there is some apprehension in competing with the private sector. but there are some areas, specifically my colleague came

up with an idea about the postal service taking over major responsibilities from the census. the post office already for the mail handlers -- through the mail handlers and letter carriers, they go into every home and business already. that is basically what the census does, tracking the population most effectively through those home visits. have you looked at any of that so it would be government taking over government work, but doing it more efficiently for the taxpayer? have we looked at any of that or have we looked at -- ms. goldway mentioned the vote by mail. have we looked at any of those? i know they are disrupted and bureaucracies are not going to be satisfied with that, but i think we have very limited choices. have you looked at any of those type of initiatives that might

really transform what we're doing at the post office? >> i will master this eventually. chairman, we have looked at everything you have said. we have looked at the fact that we had $6 billion and cost savings that came in this year. we're looking the list $7 billion and looking at the fact that the male has declined. and we're looking at the huge transformational revenue issues. as i said, $45 billion is what it would take a close the gap. we have some initiatives under way and we've looked very specifically at the initiatives you have identified. on the senses, my understanding -- on the census, 90% of the census responses come in through the mail. though it is not my responsibility, i understand there was a report by operation team meeting with the census bureau saying that we're going

back in knocking on doors sixers seven or eight times to get that last 5%. we may not be the best suited agency. we're willing to real look at that. but by mail, we are actively looking at a range of ways to do that. -- vote by mail, we are actively looking at a range to do that. >> i yield to the ranking member. >> has there been any sort of analysis -- any of you can answer to this -- the passports. is that a revenue generator? is it a break even operation? any sort of analysis that says that that was a good idea? >> we have not done that analysis. mr. bernstock or ms goldway? >> the commission has done the analysis, and it provides -- if not only break even as but it provides a contribution to overhead. it would make a profit for the

postal service. it is a successful revenue generation tool. >> i want to see some ideas here. i like the one about the national park passes. that will not get us out of the financial hole, but what are the big ideas floating out there? i want to express again the sincere reluctance to get into areas where the private sector is already competing. the financial-services, the telecom stuff? i cannot imagine being supportive of that. they had the services and the marketplace. if we look at state and local government and federal government, our constitutional duties, rolls, and responsibilities, there are a number of agencies that would benefit by this year structure and magnitude of the work force -- by the sheer structure and magnitude of the work force. >> i agree with that statement.

we do have the authority to provide financial and enrollment services to federal agencies. if we extended that all party to state and local agencies, we could do even more. >> at the federal level, give me a better sense. >> the enrollment process and passports is one active business. we could partner with a whole range of federal agencies, social security, or agriculture. there is a number of ways to credential in an enrollment work. >> is there a list of these out there? dollars can you give me more specifics about what you are pursuing? >> i do not have that data with me but i can get it with you -- i can get it for you for the record. >> did you want at something, mrs. goldway? >> i am gratified that the postal service is looking at these areas. it is a good potential resource

and a great source of stability for the local post offices in the community. one of the issues that came up in a hearing we had recently is that while the post office itself may not generate a lot of revenue, having the post office in a local community shopping center creates revenue and economic development and activity for the rest of the community are rounded. it is important, i think, for the well-being of the economy overall to continue to support of post office. >> we're just looking for real specifics here. >> the ability to connect with local government could provide at least enough revenue to continue to justify the service, if not solve the entire problem. >> you had to come up with all list of the past three or four ideas, what would be on that list? >> the biggest thing of all, and i think mr. bernstock talked about the credential in

services -- the idea that government-to-government services that the post offices and courage to do under the law, offering a platform to come up with other creative ideas. the most important thing is that the marketplace -- bring the postal service the ideas, but the postal service has become an innovative place where people who have the sense that they can come and plug and play and try ideas and test their ideas in the marketplace to the benefit of postal services -- postal customers. >> i like to pull out a call to the private sector does say, please come to our rescue. we need that created innovation that will come from the populace across this country, with the created the ideas that -- creative ideas that the postal service can participate in, making sure that we do not step

into the private sector where right the way the product -- the private sector should be leading the charges. there are credential in services and we need to continue to explore those ideas. please, if you have those ideas, send them to us. we need them. i see that i am out of time. i'm going to be under time. i would just like to note that. >> well done. mr. davis is now recognized for five minutes. >> thank you very much, mr. chairman. i will try to be as optimistic as possible. and as i let this -- listen to the witnesses, i thought of a baseball game that i was watching last night, especially when the score got to be seven- one. i was wondering if there was any way that philadelphia was going to get back. i thought, if you want and get a guy on first base -- if you

bunt and get a guy on first base, and again and get a guy on second base, and come up with a different idea -- but they are all kind of small in terms of generating the big runs that you really need. and so when i think of changing prices were shifting services bringing down the cost, reorganizing sales, become more competitive -- i'd guess that i am thinking reorganize sales to sell what? other than stamps and shipping. or if you have the other services, it is there any way to be really competitive or as competitive as you need to be?

ms. goldway, i am thinking that eventually you get down to this last resort business. i wanted to ask, what would you consider to be last resort? in terms of being forced to cut services, when would the last resort,? -- when with a last resort come? >> the commission has a process for making these decisions. it involves hearing from the public and getting a whole range of a information about costs and benefits before we would make such a decision. certainly the postal service has brought forward to us and in case where we're looking at the possibility of closing some post offices. they have suggested that they may bring in another case about reducing service from six days

to five day delivery. there is not agreement yet on what the cost savings would be to close post offices, and there's certainly no agreement yet on what the cost savings would be to reduce service from six days to five days. and the trade-off between reducing services and reduction in potential volume is something that needs to be looked at. if you cut service, do you reduce demand more than if you maintain service? i think it is a very complicated matter. and what i think our commission's responsibility to do is to focus on what they pa tells us, to assure an effective postal service that provides universal service. we would have to look at those trade-offs. i may mean more of an optimist and you -- i may be of more optimist then you. i am a brooklyn dodger fan and i have survived. [laughter]

i think that incremental support can make a difference. and that there are many surprising things that developed in the postal service. net fleets, for example, that has for a time has brought to send a significant amount -- netflix has for a time brought in and a significant amount of revenue. >> i appreciate the amount of creative thinking that the postal service has brought forth. i just do not want "casey at the bat mr. coughl." mr. coughlin, d you have a prognosis under which we can pull this out and pull it off? >> that is the $68 billion question, i think.

let me just say, i am not quite perhaps as big an optimist as chairman galway about the future -- goldway about the future of revenue. i think the relatively short- term options that the postal service has on the call side are fairly evident. they have been talked about. i think they need to reduce the number of delivery days. i think we're one of the few countries in the world is still has six-day delivery. i think they need to reduce the size of the processing network from around 300 processing facility to perhaps half that size. and i think they need to reduce the size of their retail network. those are some obvious moves and i know that they are difficult. they are not changes that will go down easily. they may have some costs associated with them as well as savings.

i think the postal service itself needs to think in terms of what what the 400,000 person postal service look like, and how would you operate and still deliver on a universal service obligation. i think it that in my judgment is probably where it is going to go. you need to continue to work on the revenue issues that have been discussed. the ranking member talked about the idea that are generated from here. i would encourage on the one hand the postal service to get out there and sell the obvious benefits of the postal service in terms of its ubiquity and its geographic reach, but i also see bank branches going up constantly in growing neighborhoods out there, new brick and mortar. i have to ask myself as a banker, is there a possibility

the partner with an organization like the postal service to provide financial services? agency services, all kinds of opportunities are out there. it gets complicated, partly by the way that the federal government is organized and the way it is funding processes -- its funding processes work. that makes it complicated to get an overall work on how an agency delivers services and how it might tap into the postal service. but there are a lot of opportunities out there. i hope that i am wrong, but i think that is the direction it is going. >> thank you. the chair now recognizes the gentleman from ohio, mr. kucinich, for five minutes. who yields to the gentleman from virginia. >> i thank my colleagues.

listening to all the hearings we have had on the subject, we are clearly in search as we move forward for a new viable business model for the u.s. postal service. and on the one hand, i think we in congress may want to have it both ways. on the one hand, we recognize the iconic value of the post office in a given community. it centrality and especially smaller rural parts of our country, and we do not want that to change. we do not want to chose -- close any offices. we do not want to close any routes. we do not want a cut back on the number of days of service. and on the other -- and we do not want to necessarily compete with the private sector for anything. on the other hand, why are you losing money, why aren't you

making money, why aren't you like your competitors? and we in congress cannot have it both ways. we will have to work with you to recognize that by statute, and mr. hare, i would be interested to listen to your testimony, should the post office be subject to the same regulations as the private sector? but by statute, we put some requirements on the postal service that we don't put on the private sector. i think they significantly circumscribes the ability of the post office to break out here and just be a rational actor in a private market. >> i would agree with that. we're simply trying to pose some questions that folks in your situation should be considering as you take a look at this. it is a large enterprise that touches everyone slight six days a week. as chairman lynch mentioned that the opening, no other institution does that six days a week. as you proceed with thinking

about this, some of those tradeoffs do get raised and it is important to keep them on the table as people consider them. if we do not raise them now, they will come up later. >> out at your list that you have an obligation to look at the statutory limitations or expectations we put on the postal service that make it different than an entity in the private sector. >> and on that point we have ongoing work looking at the postal service business work. we're factor in those kinds of things into it as well. thank you. >> how could the postal service inc. the banking idea that mrs. goldway talked away -- talk about without threatening community banks? >> i think mr. coughlin really just talked about it a second ago. i think that there has to be a process that creates some kind of partnership in which the

private sector gets to do what it does best. this is the marketplace that we live in today. one quick point that i would make, that i think jack potter the other day in his speech at the national press club created this framework, something ruth goldway had in doors, looking out into the future 10 years and try to imagining what kind of postal service should we have -- should we have to serve the public purposes that we seek 10 years from now. i cannot look at 10 years and not imagine that the internet is not a part of the marketplace at that time. is inappropriate for the postal service to provide those services? probably not. and so finding partnerships were the public sector can be compensated for its retail presence and its ubiquity and the private sector can provide what it provides best, it seems to me that as part of that 10- year vision.

dollars ms. goldway, what do we know about the plasticity of demand for the pricing? is the demand inelastic such that we can raise the price the whatever we need, or do we see significant falloff in volume every time we raise the price? >> we have about 40 years of falling -- falling -- halloween -- following the elasticity. for all that time, we can say that it was inelastic. you raise the price, volume drops a little but it comes back up. step usage of the rate of population growth, and to some degree the economy, all for that tender things really changed in the last four or five years.

there was a slow but steady decrease in the first-class mail, and it has been greatly increased by this recession. and that the limit for all of us is to see whether the recession was an unusual event -- because after that great drop off after 9/11, it picked right back up again. or is this a lasting phenomenon? all this field the growth of the internet makes the role of mail very different from what it may have been in the past. we're all trying to find ways to make the mail relevant and valuable. we may not sell as many stamps, but people are willing to pay more for it or some other way in which the community supports it. some of the european posts have subsidies for their mail, or specific subsidies for post

offices. in fact, even those that have had great profits in the last few years are having real profits under this recession as well. -- real problems under this recession as well. it can give you some ongoing permanent post offices is not assured as well. >> i think ms. goldway is answer underscores -- ms. goldway's answer underscores the problems. we need to figure out a new business model that will work. >> i thank the gentleman. we now recognize the chairman from -- the gentleman from ohio for five minutes. >> thank you, mr. chairman. i am grateful that under your leadership this committee continues to look at what we can do to secure universal service for the people of the united states. my neighborhood in cleveland, ohio, i have seen of the last

few years the postboxes disappear from the neighborhoods. i do not take that lightly. to me, that has been an essential part of the infrastructure of the postal service. the next part of the of the structure of the branches. -- of the infrastructure are the branches. the postal service has been systematically targeting bridges, particularly in areas -- targeting branches, particularly in areas that are economically disadvantaged. and we know that they are cutting hours. they keep trying to downsize this postal service. now let the same time, there has been an expansion of dealings with the private sector, the

private sector taking over more and more. i think we need to look long and hard about this creeping privatisation that has been going on in the postal service. it really is at odds with the universal service. if the postal service is a money loser, why is the private sector wanting to take it over? think about that. if it loses money, why would anyone want to take it over or even turn it into a bank, it is such a money loser? this service belongs to the people of the united states. and while certainly every business model needs to be updated, privatization is not updating the business model of the postal service, it is destroying the postal service.

i have a question for chairman goldway. welcome to this committee, chairman. your testimony echoes my concern that diversified the services provided plans to move forward with providing non-postal related services and could lead to reduction in central services traditionally provided by the post office and could subordinate the provision of these services to the pursuit of revenue. much of the united states postal service air mail has already been outsourced to fed ex. can you please explain or expand on the concerns regarding cuts in essential services until revenue-raising plans had been successfully implemented and moving away from traditional services could lead to the privatization of the core services the pose services -- the postal service's are mandated to provide? >> thank you, congressman kucinich.

both of us met each other 30- some odd years ago when you were mayor. >> i am sorry. dollars we were mayors of our respective cities about 30 years ago. we share this focus on the local impact of the postal service. i do not think that the commission is supposed to the postal service providing non- postal services. our litmus test is that we expect the services to be in support of the mail function. so greeting cards are fine. money orders at the postal service, even electronic money orders alike -- internationally are fine. there are range of services that are fine. we're certainly open to the postal service coming up with any number of experimental products, should they have them, that are related to postal

services. we actively support and look for it to the postal service coming forward with those new ideas and i think our record is that we accepted almost all of them. the problem is, if you look at the postal service in its network, the retail clerks that aren't there are paid very high wages. i think that they should be. but look at the bank next door and the wages that are paid to the bank next door. it is not likely that a bank is going to want to partner with the postal service unless there is some real change in wage structure. which may result in problems as well. >> if i may, my time is expiring. i like to make this observation. mr. chairman, if banks want to partner with post offices, that would only do that to take over the post offices so that people

would then have to do their postal business through banking. this is very easy to see. we used to be able to go to a bank and pay bills. then they stop doing that. it is easy for them to take up the function of mailing and then just take it over from the government. we had enough experience with the workings of banks here to note that if banks -- we're looking to the private sector for government services, we're looking at the wrong place. >> i thank the gentleman. i will yield myself 15 seconds. what is happening here is that we see a model out there, a competitive model. when i go to the stop and shop or the paypal wiggly -- piggly wiggly, i think the post offices under that similar pressure as well. i'll wait until i have five minutes to expand on that further.

i deeply appreciate the gentleman's comment and i had three with the threat that he is identified. i would also like to welcome former representative william clay. thank you very much, sir. we appreciate your attendance. just-in-time to hear from your son, the gentleman from missouri, mr. clay, for five minutes. >> thank you, mr. chairman, and thank you for conducting this hearing today. like all of us, i am deeply invested in the success of the postal service. and i am happy we have continued to think critically about ensuring a positive future for the usps. also, let me welcome by a panel -- the panel to these proceedings. i thank you for being here to share expertise. also, as the chairman mentioned, my older brother is in the front row.

we welcome him, also. [laughter] let me start off by saying, much of your recent efforts has gone toward innovation in new markets. is there any value and expanding existing postal services to increase revenue and customer loyalty? anybody can take a shot at it. miss goldway? >> i think, congressman clay, there is a balance between driving down costs and growing revenue. the tent in starts with the fact that once again, this year, we had $6 billion in cost savings and we think that is the single largest cost saving by any company in this country, possibly ever. yet we lost $7 billion.

all the revenue-generating efforts we are perk -- pursuing clearly contributed. but when you have a loss of that magnitude, if you cannot get back to a stable postal service without some changes in the cost-saving initiatives that are not within law at the carmen -- at the current time. >> has there been the effort to strengthen the services, such as first-class mail? dollars at the current time, we are running a first-class incentive program. the impact of that we estimate will be $50 million, $100 million in incremental revenue. but once again, in comparison to a $7 billion loss, it is relatively modest. there are things that we're doing. the elasticity is increasing

both from consumers and commercial mailers, and so we're fighting a difficult uphill battle. >> i guess that begs the question, how can the usps car about their own niche and continued to differentiate itself from other mail services? >> as many of the panelists have said, and as we have heard, we have enormous number of streets. yet our infrastructure, our delivery capabilities, our logistic capabilities, the fact that we're number one in trust -- all of the strength that we have should be leveraged. what we need to do is have more freedom to expand our model as this country changes. and build on the strengths that we have. >> you cite examples in international markets as evidence that usps should include other services for customers.

how successful have these efforts been internationally? did they turn a profit or do they break even? perhaps mr. coughlin can answer. >> i will comment on that. i read in my state as some of the results that they have had. some have generated as much as 75% of their total revenues from non-postal sources. deutsche post, for example. but they have undertaken major diversification. the germans had bought heavily into the logistics' business and made several multi-billion euro acquisitions to get into that business. they had -- although they show

profits for the most part, they are having a little trouble right now. the interesting thing about the germans is that they go from 75% of their revenues from non- postal services, but 50% of their profits for male -- from mail. to call it a success, yes, there are success stories, but some are not doing quite as well as they look like they're doing. >> thank you, mr. chairman. >> one of the things i worry about, and i yield myself five minutes, that old adage, we tend to fight the last war, just like our military. now that thing described as nibbling around the edges, i

look out there and you look at some of the other countries, as mr. coughlin has noted, sweden with a system where you click on and see your mail, and actually read some of it, the pamphlets or brochure that are coming to your houses. you can click to see whether you want delivered and not. that is a great environmental benefit, in the long run, but it will drop the volume of mail. but that is really the future. so i do not want to get caught up in addressing the things that we see now, but i would rather anticipate as a commercial business would what is coming down the line. even our domestic models light --like first-class mail or other

systems. i just think that we have to really think long term here. there was a book out, and older book, of a global world is flat" by thomas friedman. he had a chapter in ups. -- he had a chapter on ups. he gave an example of the toshiba computer company. they have a warranty on their laptop computers were in effect -- if anything happened, you mail it to japan and they would fix it and send it back to you. as ups is described in the story, they turned out all around. instead of the users sending their laptop to lana and then off to japan to be fixed, ups but they're wrong people to work repairing those computers. -- put their own people to work repairing those computers. that is totally outside that

business model. they became computer technicians and save toshiba money. that type of innovation, the transformative change that we need in the postal service. i know that it is frightening, and another bureaucracies -- and i know that bureaucracies are more resistant to change, but i see with a drop off and volume, what we see coming down the line, i see the number of retirees that we have in our postal system. we have to have a business model that allows us to continue to benefit -- provide those benefits to retirees. we're going to fall off a cliff here if we do not get our business model matched up with the realities that we have here. there may be some short-term destruction here, but we

encourage you to take that chance to think big, think big. this is a big problem, so the response here has to be transformative. we have to look at this in a different way than just nibbling around the edges and trying to bring a few more million in in revenue. do you have anything like that? some big moves that would help us take a bite out of the deficit that receipt? >> term allege, i speak for the postal service and we totally agree with what you're saying. we are 5% of the world's population and 50% of the world's mail. we're the leaders in hard copy mail. what is frustrating is that we believe we have the same kind of role to play within digital

communications. it is hard for us to look at sweden leading the united states. we should be out in front of the technology changes that are occurring. if not for any other reason than to foster commerce and have the united states be a leader in this transformation to digital products and hybrid products. without these types of transformational movements in concert with the cost savings, we could have a vibrant, growing postal service. >> the postal service has presented alternate mail products to the -- in the past and we have a coke -- approve them. it was the postal service that found that they could not implement those programs. they were not up to the task. if there is some partnership that they can develop, i think

the postal regulatory commission could certainly reduce debt. i am not sure that there is any need for new and their regulation. -- any new regulation. >> you see what mall -- what wal-mart and stop and shot and grocery stores and harris teeter, these big box stores, but they have done is did not try to recreate the rahm bait -- their own bank. they brought the post office and, that brought the bank's then, -- they brought the banks in. if you do that the right way and use it as leverage, and we had 37,000 post offices out there. so we own the footprint. what we put in there -- and i am not suggesting going out there

and start the u.s. postal bank. but can we bring and other services within the footprint of the postal facility to offer more than what we are offering right now, and have that entity, that private entity, pay some of the freight there, since we already own a lot of these facilities, although i am surprised to see how much we are still leasing. just trying to multiplied our competitive advantage where we can. >> the greeting card test we're running right now is a good indicator of what you're talking about. before we launched that, we went to consumers and the feedback was that, i guess, they would be pleased to have greeting cards offered in the postal service. they expect to purchase them there. there is a range of other products that we could sell, that we actually think would grow the market.

beyond passports, there is a series of transnational activities we can be involved in. i would agree that there is a lot more that we can do with the facilities that we have. >> and i appreciate that. changes difficult. >> some of it would require changes and ala. someone not. >> we would have to work to see what we can do. -- some of it would require changes in the law. some of it would not. >> i agree that we have to think big. part of the problem is that we do not we will like the answers that we get. it's like everyone wanting to go to heaven, but no one wants to die. [laughter] and when i think of costs, we generate at one location but

then we spend at another. we generate as people come in to purchase whatever id is that they are purchasing, but the al lead is as we try and maintain the concept -- the output is as we try to maintain the concept of universal services. i know it is difficult to receive a piece of first-class mail, for example, if you live out on p.o. box -- like i used to live -- or the carrier would go mfive miles before

delivering another piece of mail. i do not know how much you generate from the post office has to sell what other products you are selling. it seems to me that we have had some experiences and continue to have some experiences that bailouts -- with bailouts. we put resources into places. i think we have to do some serious thinking in relationship to what it is that we expect. i really do not want to have cancer and have someone tell me i've got a sore. i do not want to have pneumonia and someone had me believing or thinking that i have just got a cough, a little cold.

i agree that there are no shortcuts or easy routes or easy ways home, but i do think that we're going to have to go for the big picture in terms of evaluating our thinking relative to what it is that we want from our postal service. i'll never forget a guy that made a speech when i was in the eighth grade. he came to our school and said, ask yourself three questions. one, who am i? two, what do i want? he and three, how do i propose to git it? -- get it? i think that we will have ask

ourself those questions about our postal service. i'm a strong union supporter, always have been, always will be. i believe that people should get the maximum of what can be received in terms of quality of life and expectation. but i also believe that there has to be realistic thinking and relationship to how do we manage a way to do that. if anyone would respond. i would appreciate it. if not, mr. chairman, i thank you very much for the opportunity. >> have they to signal votes? i would recognize the gentleman from virginia for five minutes. >> i thank the chair. mr. coughlin, d believe that the usps has a culture of innovation?

and it's not, why not? >> i think it has pockets of innovation. >> please speak into the microphone. i cannot hear you appear. >> i believe that there are pockets of innovation within the postal service. i do believe that there are some conditions that exists, and i did not think it is you need to the postal service. i think it is a characteristic government generally. to discourage risk taking and innovation. and it does not generate an environment where innovation is expected on the part of employees. >> or rewarded? >> that is a difficult issue as well. i spent 32 years there. i think it is the greatest work force in the world.

there are some enormously creative people there and they are going to need all that creativity as they go forward. i believe that they have done a terrific job in terms of generating an environment that encourages people to come forward with new ideas, and just the move of bringing in people like bob byrne stock and some of his colleagues to help support the traditional -- bernstock and some of his colleagues to help support the traditional thinking through how we go back to the comments about the future from the chairman. i wish i had an answer to what that business model ought to be. i do not right now. i think these things evolve over time. one of the things i mentioned in my testimony was that i believe one of the possibilities is for the postal service down the road, in this nexus between their geographic, physical presence and the communications

technologies that are out there. that is some of what -- the swedish example gets to that. yes and no, that is the answer to your question about innovation in the postal service. >> i thank you. ms. goldway, you intriguingly noted that the post office fleet is one of the largest in the country. in some ways, given the route structure, it is tailor-made for electrification and cutting edge green technology being employed. could you expand a bit on that? have we done any studies to show how many pounds of carbon dioxide could be avoided? what could the energy savings be? >> this is an issue i ventured into just in january of this year. i have discovered that there is

a whole range of expertise far greater than mine. i have many studies that i can afford to you about this. -- forward to you. current vehicles get 8-12 miles to the gallon, and they are all at least 18 years old. unfortunately, given the financial reality of the postal service, they do not have the capital to buy new vehicles. i think it would be worthwhile to find funds in some of the other subsidies that are provided for the government. direct them to the postal service said that they could invest in new vehicles, reduce some of their overhead, and lead the country and a national transformation. >> i think we are on to something here. how many vehicles in the fleet? $150,000 -- or maybe 140 thieves