that we should give these borrowers the same type of personalized, sitting around the kitchen table guidance that they initially got when they first buy a home or apply for a mortgage. it helps them and starts them on the road to successful and sustainable home ownership. we also estimate that freddie mac helps more than 250,000 borrowers avoid foreclosure in 2009 both to our traditional methods and this mha program. .

let me be clear. our role is to answer questions, provide information, and be responsive. others will decide. others are the decision makers. still, given the opportunity, what kinds of facts we bring to the attention -- or will we bring to the attention of the decision makers? what are some of the key traits that we believe the u.s. secondary mortgage market ought to include? and do the gse's help the fought -- housing finance markets achieve these desirable traits?

when asked, we will remind decision makers at freddie mac as a constructive, vital rule in the market that will help enable the housing finance to do a number of very important things. let me list five. first, we helped make possible the 30-year fixed-rate mortgage. by giving families stability and certainty, this is a true economic aspect for our nation. second, we are the constants liquidity provider, the source of a mortgage market last year. we are the backstop bid, meeting our customers know that there will always be a buyer for our loan. it will keep lending and in the

environment and keep prices more stable. we deal of innovation in the mortgage market's better than a purely a government entity. we are an important countercyclical influence that stays in the housing finance market even when purely private capital has pulled out. this has been proven by the events of the last two years. we don't claim to be perfect. i am glad our regulator was strengthened and for the reform and regulation is virtually certain. we perform a vital -- the program is essential. we're making decisions about fmha and other issues without being guarded solely by profitability that no purely private bank ever could. there is much positive to be

said about the gse's, and i hope the value will be recognized. that is what our employees care about and are deeply motivating. it means we are needed. we have a unique and vital role. there is nothing better than having a purpose which is meaningful and important. it is why freddie mac's employees are the most committed i have ever had the privilege to lead. that is why a their special skills are so vital for the nation. with that, i want to thank you very much for your attention, and i would be happy to answer your questions. thank you. [applause]

>> thank you for your remarks. we have a few questions here. the first one is really from a student that the student didn't quite get the chance to ask the question during the earlier session. the question is, can you hear me? kent is that better? how large is the risk of inveigh -- inflation over the next several years. how will that affect the u.s.'s ability to run mortgages? >> there are two schools of thought about emulation. it is not much of their problem. we have enough unused capacity in terms of labor and manufacturing productivity. the companies will be able to raise prices over the next couple of years. there is some worry about inflation down the road.

certainly, the fiscal policy right now is deeply -- deeply in deficit. many people think that it could, if unchecked, lead to inflation. inflation will not be much of a problem, and therefore, there is great likelihood that the interest rates will stay at their current low levels. our forecast for the year 2010 is that mortgage rates will stay in that span of 5% or 6%. there could be some move up in mortgage rates as the government reduces their support of mortgage-backed securities. that is why we would think that there would be some movement during the course of the year. last year and last week, you could buy a 30-year fixed-rate mortgage with limited prepayment penalty and the rate was less than 5%.

it is incredibly low. we don't think it will stay at that level for the entire year as the government pulls back. it will stand control and not be higher than 6%. >> there were several questions about barney frank's remarks about doing away with fannie and freddie. the questions are related to what kind of an effect this has on your organization, and if you were to advise mr. frank about restructuring, what would you tell him? >> i am a real barney frank van. i feel like i know him reasonably well. recall that i spent a lot of years in boston and ran a financial services company. he chairs the financial-services committee. i had the chance to visit with him in the past. i have gotten to know his staff quite well. i am a real admirer of congressman frank. he is incredibly bright.

he is committed. he is a true public servant. he really cares. i admire him greatly. secondly, in my speech, i talked about the fact that freddie mac is not a decision maker. we don't even get to lobby or advocate. that is precluded in our current state. not a decision maker. i totally get that the house financial-services committee chaired by congressman frank is a decision maker. a very important decision maker that will be heavily involved in the decision as to what happens to the gse's. i do have to say that friday was not my best day. either in my life for at freddie mac. because i am an investment person, i do pay attention to a

bloomberg. that is a news lifeline for those in the investment business. there was a headline that came across about 11:00 that congressman frank was having a a hearing and said that he would like the company that i was ceo of to be abolished. i felt that the votes were there, the house financial services committee would be voting for the abolishment of freddie mac and fannie. not a great headline. it was picked up and there were many articles that used that word "abolish." i have not had a chance to visit with the congressman. i look forward to doing so.

i know i will have the opportunity to do so. we will talk about it. i get that he is the decision maker. but in this interim period, it wasn't a great day for me or our 6000 employees that saw that headline. it is something i met with employees with on monday. not our and tort workforce -- and not our entire work force, but it was a concern. it was not a great weekend for our employees. it is something that as a ceo i have to deal with. i have to keep them energized and motivated, working on the president's program, making sure that we provide liquidity and stability to the mortgage market. i have to do all i can to keep them energized and focused on that mission. we have done a good job so far. certainly, the headline was not

helpful. >> after six months, with their reassessment of the capabilities of freddie mac? >> absolutely remarkable. what is amazing about this company, i was winding up my life at putnam, and got to thinking about being the ceo of freddie mac. this was june or something like that of 2009. at that point, they did not have a ceo, a chief financial officer, and it did not have a chief operating officer. a company on the order of 6000 employees with none of those three positions at the top. one can only imagine what the company might have been like. i arrived there in the summer, and it was remarkable. a very well-functioning company with great people there. wonderful people running the

functional areas and the divisions, a good team-like atmosphere. how truly committed to the mission they are. i sometimes joke that i come from the financial services world, the asset management world and investment banking world. throughout my whole life, the 35 years i have been in that business, we have talked about serving the client and taking care of the plant. the difference is at freddie mac, they really believe it. they really care about the mission of trying to help people. that is the reason that people come to work at the company. it has blown away. i find them to be incredibly welcoming in a supportive, such a remarkable group of people. >> i have several questions, some of them with a little bit of an edge regarding what happened historically. >> i have fixed again.

>> i bet you do. -- i have thick skin. >> i bet you do. we like to know what you think happened and what can be done to fix it? >> i am not going to be very helpful in that area, because i don't think it is my place to talk about what i might or might not have done in the past or to second-guess people or assign blame. my focus is on the future and trying to help the mortgage market going forward. i just will offer the following statistic. as all of you, the country, the decision makers are evaluating the work that was done by freddie mac, remember this. we are responsible for 25% of the mortgages, and only 9% of them are in serious default.

our default ratio is on the order of about 3.8%. for the national average, it is about 8 or 9%. i think those statistics make it absolutely clear that, for the most part, freddie mac did a very good job of supporting the housing market, it uses sound judgment when they were making the loans. i am sure they were not perfect. with the benefit of hindsight, others could have done a better job. it seems those statistics and the company did a pretty reasonable job. the major shortcoming was that the only business they were in by charter was the housing finance business, and there has been just a complete seat change in the housing markets. if that is all that you invest

in, and you have a default rate of 3 or 4%, you will have economic problems. >> there were questions about people having good credit ratings and not being able to get mortgages. eighth thoughts about how that might ease up in the future? >> not surprisingly, it is a pendulum. i don't think that is a surprise to anybody. it is true for manufacturing companies and individuals. after there is a problem, credit titans up throughout the entire economy. and the economy starts doing better and people try to get more comfortable with extended credit and to get loose over time. i have watched this, and it is a sequence we will have the work group. it might be a little bit tougher

to get mortgages. i can further say that last year, the total amount of mortgages we put on were $550 billion. we were very active in the market. it is totally possible to work with people. it is very high quality. >> there are several questions about what changes may have occurred inside of freddie mac so that the same problem won't occur in the next three or five years. >> right now, our principal focus has not been on changing the company some much as it has been being responsive to the crisis that we are facing and doing all that we can to keep people in their homes and make sure that we support the president's programs, to make sure there is mortgage money available.

that we meet our goal of liquidity, affordability, and stability for the mortgage market. i would say that we continue to add resources in the area of credit and risk. we want to do an even better job. that is not an indication that we weren't doing it well in the past, but we understand that we have got to make sure that we are a strong company and that is one of the places where we put some resources. i underscored the notion that my tenure was not about fundamental change as focusing on doing everything we can to try to keep the mortgage market liquid and support the president goes to programs. >> another question from a student. an inspiring investor, i guess. >> is freddie mac stock safer to buy because it is government sponsored? are you buying a stock?

[laughter] >> great question. we have to make that distinguish ment between common stock and stressed. it is probably not so true with regard to the equity. the equity is not guaranteed by the government. it is a very volatile stock. it trades in the zone of $1. one would have to think of it as a risky speculative stock. we have drawn down about $52 billion from the government. we pay 10% interest rate on that. we pay about $5 billion.

i guess for a young person, i would want them to understand the full risk associated with that equity investment. as in the buying -- and as for me buying the stock, i have to make the disclosure, and i have made none. dodge a this is our last question. why would you want to be the ceo of this organization? >> yeah. [laughter] my wife and i met in law school, and i have great regard for her. she has asked me that question before when i took the job and several times thereafter. it gave me a chance to reflect on it.

first of all, i think it has something to do with my age. i am not sure that it would be exactly the right career development for somebody that was in the heart of their career because there is a much uncertainty that is going to happen. it came at the right time in my life. i could spend whatever time to try to stabilize the company, get in shape, and it can go on to the next chapter. i thought it would be helpful for this organization to have somebody be the ceo who did not have a really strong ax to grind in the outcome. we wanted to do what was best

for the company and the employees in terms of the final determination in not what is best for their particular career. because of my age, that was an easy thing to do. i struggled with that decision whether i wanted to do it, because of the things you read in the newspaper, but once i did, i felt good about it. a little shaky last friday, but generally felt very positive every day because of the people. they have been so welcoming to may. it has been a great thing to do. >> thank you very much. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] >> thank you so much for a leadership that enthusiasm for your position and for being with us today. the key for all you do for the regent and the economic club. ladies and gentlemen, thank you for being with us.

at this meeting is adjourned. >> it marks one year since the congress passed economic stimulus money of the $787 billion approved. just under 380 -- $330 billion has been committed with just under $180 billion payout so far. -- paid out so far. here is a look at our schedule. coming up next, former supreme court justice sandra day o'connor on the impact of recent high court rulings and the process for judges at the state levels. and we addresses with president obama and maine senator susan collins.

at a special with journalists. tomorrow on "newsmakers." the chairman of the senate democratic policy committee talks about whether the president made a mistake in putting health care on such a high place on his agenda. >> a moment ago, you mentioned health care. he made it his signature legislative push in 2009. the think he made a mistake? >> i do, and not because of care isn't important, but the timing isn't good. standing in a very deep hole, it is hard to reach as high as you need to reach to put together a health care proposal that can get to the congress. i personally would have said, let's work exclusively on restarting the economic engine once again and putting people back to work. i am sure the president will say he was working on that as well.

if i has staged this, i would of said that first, health care later. but the president won the election, i didn't. his position is that you can't fix the economy without fixing health care. there is truth to that. but we found a very difficult to create a menu that can be enacted and signed into law by the president. you can see the entire interview on newsmakers, tomorrow at 10:00 a.m. at 6:00 p.m. eastern on c- span. >> sunday, the history of executive power from george washington to george w. bush. author john yoo talks about his book "crisis and command." afterwards, part of our booktv weeken on c-span 2. >> and now, sandra day o'connor on the impact of recent high court rulings in the selection process for judges and state levels. she spoke earlier at an event

hosted by georgetown university and the aspen institute. this is about half an hour. >> the folks in the back understanding, plan to take their seats. we can get started. i am pleased that we have been joined by some of our georgetown law school students. i am meryl chertoff, director of the program at aspen institute. i would be remiss if i let the opportunity to go to say a few words about some of our programs that are coming up. in november 2010, the third georgetown aspen institute symposium will take place and it will treat one of justice o'connor's other interests, and that's education. the event is going to take place -- it will be devoted to

the subject of civic education which justice o'connor has done some much on in her years since leaving the supreme court. each year, we conduct a seminar in aspen, colorado and which we read classic works of political philosophy in the jurisprudence. a seminar this year will take place july 13 through 19. if you are interested, further information can be found on the aspen institute web site. the moderator's for [unintelligible] the same bottle programming i hope we're providing today will be provided in a more expansive week-long format.

i now have the very distinct pleasure to introduce our keynote speaker. most of us in this room are familiar with the least some of the details of sandra day o'connor. raised in arizona, a stanford law school graduate and law review editor his initial job offer was the legal secretary at the firm she applied to. justice o'connor rose to prominence as a prosecutor and as a member of the arizona state legislature. and in the historic moment when president ronald reagan selected her to join the supreme court of the united states, the first woman to do so. justice o'connor, while remaining always faithful brought with her the experience and pragmatism of her days on the ranch.

her display a keen understanding of the separation of powers and the important role in our nation played by the states, the workshop of democracy. upon the retirement, justice o'connor turned back -- she has become an outspoken advocate with a particular concern about the corrosive effects of money on state and judicial races. she has spoken out in favor of a game changing subjects and merit based selections in which a roster is submitted to the governor and that makes his or her pick. and after a term, the judge is presented to an election. it is a system that has conducted transparently and is able to assure high quality judges and assure some element of accountability she helped

shepherd to the state legislature and serve the state of arizona well. at a time when the decision has cast a harsh light on the role of all kinds of political races, the retirement work is more relevant than ever. it is often said of justice o'connor swing implies an indecisiveness or lack of commitment. justice o'connor is anything but that. i think her colleagues would say that as a jurist and as a human being, justice o'connor was the heart of the supreme court. she is held in the highest esteem, and we're privileged to have her with us today. ladies and gentlemen, the hon. sandra day o'connor. [applause]

>> don't stand up. that was too kind introduction. we're just here to learn something today. i am right with you. learning about what has been going on with the supreme court. gosh, a step away from a couple of years and there is no telling what is going to happen. [laughter] thank you, meryl, and thank you, georgetown law school. thank you for putting together a symposium in which i think all of us have a real interest today. you have heard some good panels on citizens united. your the experts now. there is not much that i can or would try to add to the explanation of these cases. i want to take a step back and think about how these two cases

of fact the threat judicial independence. they become intertwined in the political process. i think that these two cases should be a warning to states that's bill choose their judges by popular election. -- and that still choose their judges by popular election rather than some modified process, some of which we hope merit selection. the states should think about whether changes are needed in the system. or whether failing that, the damage to our judiciary and our democratic system is going to become substantially worse. the independence of our federal judges was critical to our founding fathers. americans love the look back at

the founding fathers. we don't have any mother's milk back to, but we look back to those fathers. -- any mothers to look back to, but we look back to those fathers. two of the main grievances are listed against king george and the declaration of independence involving the absence of judicial independence in this country. the declaration charged that the king had obstructed the administration of justice by refusing to establish judiciary powers. he made judges dependent on his will alone for the tenure of their offices. and the amount of their felonies. and to safeguard against those abuses, the founders insured that the constitution provides a federal judge's, anyway, with tenure during good behavior and

a salary which can't be reduced. at the constitutional convention, there was one delegate that proposed that federal judges should be removable by more expedient means then impeachment. he was shouted down by the other delegates. one delegate described the proposal as a weakening in -- i mention this history, just so that we don't forget in our debate on how we selected judges, the founders of our nation saw fit to make federal judges independent of the other two branches, the political branches so that they would not be beholden to those two political branches in their

subsequent interpretation as judges of the laws and the rights of the citizens. the founders realized there has to be some place where being right is more important than being a popular or powerful, and where fairness trump's strengths. and in our country, that place is supposed to be the court room. in 1968 when the supreme court struck down the misogynist laws, a gallup poll showed that only 17% of respondents approved of interracial marriage. that is a very small number. it is hard to imagine that judges that can easily be defeated in elections or removed through political devices would

have handed down an opinion like that. i am not sure what the gallup polls would have shown in the southern areas of this country about integration of our schools are racially before the supreme court handed down brown vs. board of education, but i suspect those citizens and large chunks of the country were equally hot style too bad ideas as well. these examples show that in order to dispense the law without prejudice, the judges have to be assured that they are not going to be subject to political retaliation for their judicial acts. but many states in the united states today don't apparently agree with this concept, but the founders of the constitution on that idea. more than 80% if you look across the country at all state and

local judges, that includes justices and the whole crew, 80% of them have to lead a political election to gain office or stay there. i suppose it is not all that surprising because the opals -- and majority of americans want to elect their judges. if you ask them, they say yes. the point is, public support for judicial elections is a system of the weakening -- there is not a reason for it. the voters in states that elected judges will now also are more cynical about the court. they're more likely to believe that judges legislate from the bench is distrust of the

judiciary that makes voters more inclined -- if you don't believe, as a citizen that judges can be fair and impartial, you might want to select your judges by a process that will be most likely to result in a judge who is partial to you. and they can be unfair in your favor. if you think judges of legislate from the bench, then your willing to invest a lot of money to try to get the legislation that you want. if you are a litigant likely to press -- appear before an elected judge, it makes sense to invest in that judge's political campaign. that is where we are. given the stakes involved, it is surprising that a case like this

did not come out sooner. we all know what the issue was that they had to decide. you can understand the reluctance of the court to get into, because you don't want to set -- a subject the federal court to thousands of recusal of motion cases. that is the risk that the court based on. one thing is certain, the events in that case just did not look good. it is a sad environment when that situation comes out as a constitutional policy, because it is so clearly bad policy for a state to allow that kind of thing to happen.

no state can possibly benefit from having that much money injected into a judicial campaign. the apparent bias is high, and it destroys the credibility of any judgment favoring the political norm. maybe supreme court's decision -- thank you. will stop the situation as egregious as this from happening it can. -- happening again. the governor appointed an independent commission on judicial reform to improve west virginia's judicial system. i participated in an honorary capacity in that. and was honored to do so. tweaking campaign finance rules and refusal standards, while helpful, just to treat the symptoms of mixing politics and

the judiciary. it does nothing to address the underlying distrust that judicial campaigns and cases like this to breed. whenever the solutions, -- what ever the solutions, we have not seen a major change in west virginia. maybe we will not see major changes elsewhere either. no amount of the election all or reform is going to remove the politics inherent in partisan judicial elections because they are specifically designed to infuse politics into the law. elections are intended to make our courts responsive to a -- to let the world politics. that is the fall and the concept. they are subject to regular and competitive elections, they can't help but be aware of that if the public isn't satisfied

with the outcome any particular case. often some criminal case as you can imagine. it can hurt their reelection prospects. it is like trying to ignore the alligator in a bathtub. it can hurt -- judicial elections are difficult to justify in a constitutional democracy in which even the majority is found by the restraints. if our understanding is that a judge's constituency is the law, not the electorate, then is very hard to make that adjustment. i think the threat to judicial independence is getting worse. more and more money is flowing into judicial campaigns.

you heard some of that today. in 1980, texas was the first day where the cost of a judicial race exceeded $1 million. that was considered a huge amount. during the past election cycle, more than 5 million was spent on the race for a single seat on the supreme court of alabama, someone here today from that state, and five years ago, there is a race that cost just over $9 million. after that race, ill. justice wondered aloud how people can have faith in the system -- how can influence the outcome of judicial elections. he won the election. you can only imagine what the losing candidate had to say. probably could not repeat it here. these funding arms races look

like they're going to get worse before it gets better. there is no question that the core's decision which i joined back in 2002 and the republican party minnesota vs. white has exacerbated the spending spree. there were canons of judicial ethics. they require them to refuse to answer questionnaires concerning how they would rule on certain policy issues. under the first amendment, states with judicial elections cannot prohibited judicial candidates in a concurrent -- and a concurrence with that unfortunate case, the state with judicial elections are just inviting problems like that, and maybe they ought to consider a

different system. a legally correct constitutional decision can have some consequences that aren't so welcome. states repeal their judicial campaign restrictions for fear that they might violate white. that, in turn, emboldened interest groups to increase spending and refuse questionnaires to pressure judicial candidates and to take positions on controversial issues. and the interest groups can then put their money behind candidates whose legal opinions for their particular political agenda. this rise in judicial campaigning makes last week's decision in citizens united a problem, an increasing problem for maintaining an independent judiciary.

i was glad have some experts here that have done the briefing and could tell us in a very articulate fashion some of the consequences. the majority did overturn part of mcconnell verses the federal election commission case and decided in 2003, since i was one of several authors of that opinion, if you want my legal opinion, you can go read it. [laughter] judicial campaign spending has increased steadily despite the campaign finance laws that are currently in place. as of last week, 24 states placed significant restrictions on corporate independent expenditures in state elections.

but now, perhaps some of those laws are insecureo r invali -- or invalid as a result of last week's elections. we cansd anticipate that labor unions and trial lawyers might have the financial means to win one particular state judicial election, and maybe tobacco firms and energy companies have enough to win the next one. if both sides unlace their campaign spending money without restrictions, that i think it mutually assured destruction is probably the most likely outcome. increasingly expensive and negative campaigns erode botht

he -- both the impartiality and the public perception of that. the long-term business interests of campaign donors may suffer despite the supreme court goes the decision -- supreme court's decision. some have suggested that they have in substantially increased disclosure rules. as any game theorist will tell you, allowing -- rely on parties to voluntarily restrict campaign contributions is risky. in an arms race, the incentive to be the only big spender is too great. it seems to me that the best way to stop the damage done by judicial elections is probably to go to a somewhat different system and have states that

haven't done so yet at least take a look at a so-called merit selection scheme. there are problems with any scheme that you might devise for selecting judges. they have their own problems, india, misery may modify or eliminate the system in missouri. my home state of arizona, with my help, when i was a legislature -- legislator, back in the '70s, we had to make a number of modifications to that system in the intervening years. i used to practice law in my home state of arizona in front of elected trial court judges. we have some that were truly an embarrassment to the state. i have been there long enough

and observe the consequences long enough. my home state can tell you that going to the merit selection scheme made an incredible difference in the quality of the judges of that state. it involved setting up some kind of committee, a formal committee to give advice to the governor on appointments. i think west virginia is tinkering with that. in arizona's case, initially, we had quite a few lawyers on the commission. today, we have very few lawyers on it. we have gone from a predominantly citizens commission, the non-lawyer members are very well qualified and they can express themselves well. it works okay. at least we can say to the public that this is not dominated by lawyers. the other thing that has happened is that arizona has opened all their meetings of

those advisory commissions to the public. when there is a vacancy in judicial office for people that are interested in being considered to file an application and include their estimates -- -- resume, all those are open to the public. if you have those meetings open to the public, there is not a lot for the public to complain about in that system. indeed, it has produced some excellent judges. i think there is no reason to think that states are around the nation that still lacked their judges shouldn't take a look at what can be done if they did so. i think three states today may ask voters to take a look at

such a system. one is nevada, one is ohio, one is minnesota. i don't know if all three will proceed. nevada may already be on the ballot, so we can expect that in that state. and maybe those states can serve as the vanguard for a re- examination of the elections more generally. as the justices in the caperton case ntoed, -- noted, it can probably only be remedied through systemic change. i hope the attention given in this conference and in other venues around the country to caperton and citizens united will speed the movement for re- examination of many states on how we select our judges.

they showed how campaign contributions can poison the system and invalidate some of the existing checks on campaign spending. the majority of citizens united has signaled that the problem of campaign contributions in judicial elections might get considerably worse and quite soon. i think the time is now for the interest groups who oppose merit selection to do a little soul- searching and see if we can't reexamine ait, give it a try and see what we can come up with. the opportunity is now. you hear today are among the people that can best restore confidence in our judiciary.

many americans do not recognize the importance of an impartial, fair, qualified judiciary. they don't realize the threats to its imposed by judicial elections. the solution is easy. we have to tell people and talk to them about it. we have to educate them. and by we, i mean ll of us. -- all of us. not jsut me. -- just me. you are among the leaders in your communities. you really are. people will listen to you about the proper role of the judiciary as long as you speak out clearly and firmly and use the channels that your listeners use. your voices need to be heard. so regardless of how we select our judges, i think maybe all of us can agree that an independent

judiciary is critical for all of our citizens since -- citizens. we need one safe place. that one place historically has been the court rooms. let's not sacrifice that. you have to help us and speak out. we can still have one safe place in our system for an independent, qualified judiciary. thank you fell much for being here today and i hope you maintain your interest in this subject. we will be spokespeople in the future for what we need to do. thank you. [applause] >> thank you very much, justice

o'connor. we are now going to adjourn. lunch will be in room 12 where the program continuation will be. we invite you to join us for lunch. thank you for being here this morning. >> tomorrow morning, linda feldman of the christian science monitor and david hocking's of "cq weekly." jacqueline o'neill talks about the role that when planned peace building in security efforts in muslim countries. after that, a former cia intelligence officer on his recent article in "form policy" magazine. plus or e-mail and phone calls. "washington journal." live tomorrow starting at 7:00 and on c-span. yesterday, the government announced a 5.7% growth in the gross domestic product. president obama talks about his

weekly online address and including initiatives to lower the federal deficit. and susan collins, senior republican on the senate homeland security committee discusses the interrogation procedures used against -- airliner flight 253. >> at this time last year, banks were on the verge of collapse and job losses of 700,000 and month. we received another troubling piece of news about our economy. it was shrinking at an alarming rate. the largest six-month decline in 50 years. factories and farms were producing less, businesses were selling less, and more job losses were on the horizon. one year later, according to numbers released this past week, this trend has reversed itself. for the past six months, the economy has been growing again. the last quarter, they grew more

quickly than any time in the past six years. this is a sign of progress. it is an affirmation of the difficult decisions that we made last year to pull our financial system back from the brink and get our economy moving again. but when some many people are still struggling and one in 10 americans cannot find work, millions more working harder and longer for less, the mission is not just to grow the economy. it is to grow jobs for folks that want them. and ensure that wages are rising for those that have them. it is not just quarterly statistics, but what people feel in their daily lives. a bigger paycheck, more security, the ability to get your kids a decent shot in life and have enough to retire one day. that is why job creation will be the number one focus in 2010. we will put more americans back to work rebuilding our infrastructure all across the country. since the true engines of job

creation are america's businesses, i have tax credits to help them hire new workers, raise wages, and invest in new equipment. i also want to eliminate capital gains taxes on small business investment and help small businesses get the loans they need to open their doors and expand their operations. as we work to create jobs, it is critical that we rein in the budget deficits we have been accumulating for far too long. it won't just burden our children and grandchildren but could damage our markets, drive up interest rates, and jeopardize the recovery right now. there are several core principles that families and businesses follow when they do their own budgets. they accept that they can't get everything they want and focus on what they need. they make tough decisions and sacrifice for their kids. they don't spend what they don't have. they make do with what they have got. it is time the government did the same. that is why i am pleased that the senate just included the pay

as you go lot that we had in the 1990's. it is no coincidence that we had that decade with a $200 billion plus surplus. then we ended the next decade with the trillion dollar deficit. we will make sure that every time we spend, we find somewhere else to cut. i have also proposed a spending freeze so that as we increase investments in things like job creation and middle-class tax cut, we cut spending on those we don't. like tax cuts for oil companies and investment managers, programs that are redundant, obsolete, or an effective. spending related to medicare, medicaid and social security will not be affected. neither will national security. all other discretionary programs will. finally, i have called for a bipartisan commission that will sit down and hammer out concrete

deficit reduction proposals by a certain deadline. because we have heard plenty of talk and a lot of yelling on tv about deficits. it is time to come together and make the painful tauruses we need to eliminate those deficits. this past week, 53 democrats and republicans voted for this commission in the senate. but a failed when seven republicans who had co- sponsoring the idea in the first place suddenly decided to vote against it. that is one thing to have an honest difference of opinion, i will always respect to those that take a principled stand for what they believe even if i disagree with them. but what i want except is changing positions because it is good politics. . .

>> less than an hour, that's how long they interrogated a terrorist and he was given a miranda warning and lawyer and not surprisingly he stopped talking. ho did we get to this point? how did the obama administration decide to treat a foreign terrorist who had tried to murder hundreds of people as if

he were a common criminal? and on christmas day the skies above detroit became a battleground on the war on terrorism. and that day the bomb being carried by abdul failed to detonate, thanks to the courageous action of the passengers and crew, nearly 300 lives were saved on the plane and more lives were spared on the ground. and the government's security system, a frontline in the war against terrorists failed long before abdul boarded his night to the united states. and it failed when his visa wasn't revoked. even though his father had warned our embassy in nigeria about his son's ties to islamic extremists. it failed when the intelligence community was unable to connect the dots. and that would have placed abdul

from the terrorist watch list. it failed when this terrorist stepped on to the plane in amsterdam with the same explosive used by the shoe bomber richard reed, more than eight years ago. and today, i want to discuss another failure, a failure that occurred after abdul had already been detained by authorities if detroit. and an error that undoubtedly prevented the collection of valuable intelligence about future terrorist threats to our country. and this failure occurred when the obama justice department unilaterally decided to treat this foreign terrorist as an ordinary criminal that will. and abdul was questioned for less than one hour before the justice department advised him that he could remain silent and

offered him an attorney at our expense. once afforded the protection, our constitution guarantees a -- american citizens, this foreign terrorist lauered up and stopped talking. and when the obama administration decided to treat abdul as a ordinary criminal, it does -- did so without the input of our nation's top intelligence officials. and the director of national intelligence was not consulted. and the secretary of defense was not consulted. and the secretary of homeland security was not consulted. the director of the national counter terrorism center was not consulted. they would have explained the importance of gathering all possible intelligence about

yemen, where there is a serious threat from terrorists who -- whose sites are trained on this nation. they would have explained the critical nature of learning all we could from abdul but they were never asked. and president obama recently used the phrase that we're at war with terrorists. and unfortunately his rhetoric does not match the actions of his administration. the obamaed a strigs appears to have a blind spot when it comes to the war on terrorism. and because of that blindness, this administration cannot see a foreign terrorist, even when he stands right in front of them, fresh from an attempt to blow a many out of the sky on christmas day. and this is in other way to explain the irresponsible and indeed dangerous decision on

abdul's interrogation. and there's no other way to explain the inconceivable treatment of him as if he were a common criminal. and this khar raid must stop. foreign terrorists are inmy combatants and must be treated as such. the safety of the american people depends on it. and i'm senator susan collins from maine. thank you for listening. notes >> up next, a discussion with journalists that covered the health care debate in congress and remarks from freddie mac's c.e.o. on the initiative of making home ownership affordable.

>> tomorrow on news makers, byron dorgan, chair of the senate policy committee talks about whether the president made a mistake in putting health care on such a high place on his agenda this last year. >> the president made health care his signature legislative push in 200 , do you think he made a mistake? >> do i and not because health care is not important. i just think that the timing wasn't good. standing in a deep hole, it is hard to reach as high as you need to reach in order to put together a health care proposal that -- that can get through the congress. i personally would have said, let's work exclusively on starting -- restarting the economic engine once again and putting people back to work. the president will say he was working on that as well. if i had staged this, i would have said that first and health care later. the president won the election,

i didn't. so he -- his position is you can't fix the economy without fixing health care. there's truth to that. so, we found it very difficult however to find -- to create a menu of health care changes that can be enacted and signed into law by the president. >> you could see the entire interview with senator byron dorgan on news makers. fndfnd [captioning by the national captioning institute --www.ncicap.org--]

fndfnd >> >> good morning. great to see you. >> we have a great session for you. before we start i thought i would do two quick things of -- of business here. last night jonathan decided he was going to be a little

creative. he wrote out budget reconciliation process and tried to figure out the letters in budget reconciliation process. what words can you not make out of those letters and what words can you make out of those letters? and so i'm going to read what you can and can't to. what you can't do with those letters is you can't spell the word fill buster. you can spell out the word pass and pledge. and you can't, use those letters to spell out lieberman. [laughter] you can use those letters to -- for pelosi and reid. and you can't use the letters for the word wake.

you can for the word you are jent. you can't for the words lobbyist win. and you can for the words poor dugane. you can't for the word apathy. you can for the word action. you can't for the word wimpy. and you can for the word bold and pansy and jelly fish. and you can for the word get a spine. and for those of you more hispanic inclined, you can't use the word [spanish] you can for fail and you can't for results and you can't for give up and you can for get it done. so we have some creativity.

one last thing before we start the panel, we have talked a bit about the pathway to getting this done. and we have talked about the reconciliation process. we had our rally on thursday. it was the first time i heard a rallying cry using reconciliation as part of the cry, two, four, six eight and let's reconcile. it has gone far. but di want to say, there's a wonderful memo that is prepared by our good friends and colleagues at the center on budget and policy priority. and that has been circulated throughout the capital hill. it describes how frequently that the reconciliation process has been used. and there have been nine bills

-- 19 bills, one, nine, 19 bills enacted into law through the reconciliation act. there were three others that -- that passed but were vetoed by the president. and just to give you an idea of some of those, the welfare reform law of 1996 was passed through budget reconciliation. and probably the things that people remember most because they were most recent were the two major tax cuts by president bush in 2001 and 2003 and interestingly, you know the budget reconciliation process is designed to reduce the deficit. and yet, in 2001, it was the only reconciliation bill that passed that increased the deficit. you can waive lots of rules. and you know, just with respect

to health care, so many of you care about the children's health insurance program. that was enacted through a reconciliation and you all know about cobra. people who are -- who are laid off and continue to get coverage by -- paying in for all of its ditch sheanses but people around the country know about cobra. you know what cobra stands for? the consolidated omnibus budget reconciliation act. remember that. and cobra actually has the word reconciliation act in it. it was passed in 1985 and anytime you're going to hear opponents talk about this extraordinary process of reconciliation and how this is devious and -- and terrible, please remember, in republican and democratic administrations, this has been used with great

frequency. so, now, turning to our wonderful program and -- terrific guests, we have three of -- of the most thoughtful journalists and poem who really care about america's health care system who have joined us, thank 234ri on a saturday morning. i'm going to in no particular order. i guess i'll start on my left. and ezra clyne is a blogger and writes periodic columns for the "washington post." and he was formally associate editor for the american prospect. and his work has appeared in washington monthly, the "los angeles times" and the new republic and slate and many other publications. and he interviewed a few years ago a couple of years ago, paug

paul krugman and paul krugman said the following about ezra. "ezra is very, very good and very, very young. because when ezra interviewed him in a restaurant, he was carded. >> that was -- paul was jealous about that. i should say. >> and i think that -- ezra is actually even prouder that -- that quite recently a fellow by the name of rush limbaugh called him a rising star. i don't know how to take that accolade. >> what came after that was less complimentry. you'll never see the rest of the sentence on the back of my book, don't worry.

>> next. seated to my immediate right, is susan denser. susan is the editor and chief of health affairs, the nation's leading journal of health policy. she's been for quite a while the on-air analysts on health issues and "the newshour with jim lehrer"er on pbs. and she's formally the chief economics correspondent and economic columnist for "u.s. news and world report." and she's been a senior writer covering business for newsweek. and for work on television, included appearances as a regular analysts. and commentator on cnn and the mclaughlin group. sheefs a niemen fellow at harvard university and if i read to you all of the accolades and prizes she has won for her terrific work, we won't have a planry here this morning.

so we're delighted to have sunser denser here this morning. seated on my far right, he's normally not on my far right. is jonathan kohn. and jonathan is the senior editor at the new republic. and he's a contributing editor for american prospect, where he serve served previously as executive editor. and he has been a media fellow with the kaiser family foundation. he's written for numerous publications, the "new york times" and "the washington post" and newsweek and mother jones and rolling stone and slate. and he's the author of the pak sick, the untold story of america's health care crisis. and the people who pay the price. and he's a senior fellow at the think tank. so give a warm welcome to these wonderful --

[cheering] [applause] it is really a privilege to be with them this morning. i'm going to -- when we first discuss this, we thought we would have health reform done already. and we were going to talk about the future of the health reform movement after health -- and we'll talk some about that, but we have got some -- other things i guess we need to traci first. so, i'm going to ask each of you first, to -- to give your own take about where you think we are today, with respect to -- to the fight for get health reform legislation through the finish line. i'm going to start first on my left and we'll do it in other orders on other questions. so ezra. >> i think you could. first, thank you for having me. good morning. i think you could say there's a good news and bad news. and as has been happening recently in the news cycle, begin with the bad.

and the democrats don't really know how to move forward. and we can tell them. but, for reasons that escape rational thought, they don't seem to themselves know. and the good news is what they do know is they can't move backwards. and that -- there be dragons. and -- and this is not they well know 1994. they can't pretend that the bill never came to the floor, that it collapse pped, that it wasn't their fault. they have all voted for it. and it has passed their chambers. they brought david back to run the campaigns and he wrote an op-ed saying, you got to pass the bilbao if you don't you're still running on the bill and the difference between passing a bill and not passing, you either get to run on the bill or a caricature of the bill. but i think that's basically where we are. that the up side of the situation is that all hodge i

think, all moral decency, all disinterested observers say you have to pass a bill, you have votes to do it. here's how you do it. and down side is for dealing with the congressional democrats and they could be a tricky lot to herd. susan, what is your take on it? >> well, ron, i saw you were quoted yesterday as saying that the initial reaction of the democrats was one of grief. and if i remember my elizabeth cube her roswell enough, they have to move from grief through denial first before they get to acceptance. and i think that the -- we're in the denial phase at this point, which is that they really are still not only paralyzed with a sense of how to move forward but just a denial they have to make a decision fast, which they do. i mean, that's legislative time clock is tight. this is an lks year. and they really have to move

very swiftly to get anything done. and whichever course they take, i suspect that where they will evolve once they move on to denial and acceptance is a kind of a two-track approach. one will be to look to do the reconciliation business and the other is pretty clear and -- and you could see this from obama having gone up to meet with the republicans yesterday. and at least in materials of the popular perception, they have to look like they're negotiating with the republicans to find some kind of a compromise. and -- and they just do. and that's because of the polarization of the political environment and unless they do that, they can't keep quietly negotiating how to do the reconciliation, which is in feblingt the one that will prevail. anybody who tells you there's going to be some meeting of the minds around a narrower proposal that the republicans and the democrats can agree on is just -- it is just garbage. it is just garbage. there is not -- i mean, we had a

breakfast a couple of weeks ago with a dave camp who is the ranking member on the ways and means committee who talked about common ground and brooks said, i hear you talk about common ground and i don't even see pebbles here. there's really not a meeting of the minds. i think perceptually they have got to continue this -- this notion that there's some kind of discussion while they, work on this negotiating through the reconciliation. i think that's probably the only realistic strategy. i hope they move through denial to the acceptance of that as quickly as possible. >> jonathan? >> so let me preface this by saying, es a i were talking about this, the way we follow the debate lately. i tended to be a yo yo just temperamently about this lately. i remember last week, i don't know how many of you remember what happened what day. thursday was a bad day last week. and democrats had. it was bad. and actually, i was getting onplane with my kids and wife to

go to florida. i'm like hiding the blackberry so the steward doesn't shut me down and i get an e-mail from someone who i talked to and the message is just dead. so i said, so i e-mailed back. i said, only mostly dead? question mark, hopefully. and i got back, no, dead bleeping -- it didn't say bleeping, dead bleeping dead. and i sat on the plane and my kds are -- are you okay dad? i sat this staring at the seat in front of me. i hadn't felt like this since the red sox blew game seven. and that sick pit in my stomach. i got off the plane and didn't check my e-mail and then the morning i went and got bagels and the same person e-mailed me and said alive. so, with the caveat that i'm all over the map on this, i actually just being here yesterday and

talking to people, relatively -- and cautiously but relatively ensthusistic, certainly compared to where i was last week. and the reason i'm enthusiastic is there's more work has been done than i realize. we're not seeing it. i don't know much about it, i would be writing about it. there's more work going on behind the scenes poong the people in congress that really want this to happen. and the leadership, the committee chairs, they made a lot of progress on figuring out this formula and the hard part is once they get this agreement. we know how this is going to happen, there's going to be, they want to pass the senate bill and pass a fix in the reconciliation process. and the stages, they have to come to an agreement on what that says and then they have to go through a long process of actually convincing all of their members to do it. they have to get it scored. they have to then deal with the senate parliament tarne and we're learning reconciliation, you don't, 60 votes.

you don't need 60 votes. it could go slowly. the other party could obstruct. there's a long process. and what i think is a great unknown. i don't know if it is a collective action problem you look at actors and senate democrat the and each one has to be willing to take the leap and at the moment like all three of them are kind of, looking but not -- and maybe they're further back than i would like them to be but the -- senate and house democrats have to understand they're going to have to do this, they have to take this vote on the senate bill that they just don't want to do. and the senate democrats need to understand, yes, they'll have to go through the reconciliation process and the white house needs to understand that neither of those two are going to do it. unless the white house really tells them they have to do it. and i feel like everybody is still holding back right now. and i don't know how that plays out. but i do know, i do feel like there's an opportunity there and actually feel like pressure on all three of them makes

potentially a difference in this, not to give you guys a message what to do in the next few weeks. i feel like there's an opportunity there, a definite opportunity, more than i would have thought at this point and -- but, they need to be pushed. >> well the other thing that would really help here is if the public opinion numbers at least in the polls started coming up. and up for the president obviously, but also just over around health reform. and i -- to fast forward to the part of what do you all do next, i mean it is pretty darn cheer -- that kaiser family foundation, harvard, and tracking poll, or in the the tracking poll, but the tracking poll shows what -- i'm thinking of the poll they did as voters after the election show that if you start taking the pieces apart of what is in the bill, they have very high favorability ratings among the public. so i think a very important agenda, at this point is to educate people as it the specifics of what is in the

legislation. and people like this -- the specifics and they hate the whole thing. go figure. right? but there's an opportunity, i think, there such that if you could at least start bumping those numbers forward a bit. and frankly the rebound of the economy probably is going to produce some -- some a little bit more satisfaction with the public notwithstanding what is happening with the job numbers. but if they could just at least see -- for the light at the end of the tunnel on the public opinion side, i think -- that is going to butt them up. but the other thing, if christine ferguson was her, she was john chaffee's health person for a along time. she would say, there's nothing that helps more than start, starting to give people lots of awards and recognition. for things. and you know, so this is the time to go and throw you know, think of you know, best congressman ever on -- on

something. and just start giving people awards and recognition. and -- and telling them you're going, you got their backs for the election. because this is -- for the -- for the democrats in the house, this is all about the election. and this is all about the -- about november. they can't see beyond november. -- november. so anything that tells them, you're going to be this for them during the course of the campaign and help them along the way and help them, give them cover to vote for this can only help. it can't hurt. >> and i want to, i want to -- i want to -- there's a good segue and into a question i wanted to ask politically. and if -- if you were -- if you were thinking through the political consequences for democrats in the congress, perhaps less so for the president, what do you think the political equation is in terms

of passing or not passing reform? you have blue dogs who are in districts that are more conservative or are less amenable to health reform. but they're the ones in the tightest margin district. i'm wondering how do you each assess the politician for democratic members? if they fail to pass health reform. i'm going to -- i'm going to go this way. and start with you jonathan. >> i mean. blike like ezra was saying before, i think the political logic of this is compelling. the way i would put it to all of them is the cut, they have to decided what it is, you voted for that horrible liberal takeover of health care that passed or did you -- you voted for that horrible awful liberal government takeover that almost passed. it is the same ad, you're going

to run against it anyway. if i'm thinking of the campaign, i want to go into that campaign being able to defend that vote. and because we all know how how it works when i was for something and then against sml. -- something. we tried that. and you know, i think you keep hyping the early stuff. this is not as much early as i would like. we have to keep. the irony is -- the ironies on this, in order to make the more conservative voters happy, you had to cut the bill down to size and because it was cut down it does less and there's less to run on. okay, waver. i'll get even that. thrr are things to run on. i think that's the straightforwardness and that's the case to make. you're going to get attacked on this and -- this is -- you're going to be painted as supporting this and you're best off having something to show for it. and by the way, i'm surprised more people don't. just the mechanics, the

mechanics of a signing ceremony are always good. passing a law is going to mean a lot of this. there's the media and this is a failure, we're going along and trudging along in this endless process. bring it to a closure and having the bill signed. that will help the poll numbers a bit. i would be surprised to see that. but whatever like i said, these are members of congress and not human beings. >> susan? >> i tend to agree. i think that the -- the -- a really interesting question, first of all, we know that success breeds its own sense of success. it just -- success is just better. and even if people and -- since we could assume the large portion of the american public will still not napped what is in the bill, they will nonetheless, there will be this aura, if things are passed and things are accomplished, there will be this sense of victory, which is the other key word that unfortunately those letters don't spell.

and that's the critical word here, is victory. and so that will be -- that'll be helpful and energyizing obviously, all of the democrats and getting people to turn out. i think that there's an interesting -- the interesting question for me is -- if you look at what the republicans are saying, and even though, those, the house republicans that put forward a bill, you know, that bill basically says, we don't care about universal coverage. right? because that bill at most, i think the c.b.o. scored it as picking up $3 million. so -- there's of course the concern that the middle chas has about premiums and about stability of insurance coverage. but for those that still care about universal coverage and getting toward it. the republicans have nothing to say on that subject. and to, to the -- so, to the degree there's the capability of rallying a lot of people in

america who frankly didn't vote, because that's -- that's why the republicans can walk away from this population. a lot of them don't vote. but a lot of you represent those communities. and you know, if there can be some sort of marshalling of that force so you could get -- get a turnout in november, that will reward people for having delivered on this. and that is going to be extreme my important. and i know that the -- the white house is still in this mode of we're calling this health insurance reform. i don't think they could do that anymore. i think they have to go back to sort of the ted kennedy universal coverage and speak to that population. i think they have to talk about reform for the middle class and the other thing they have to do is talk about delivery system reform piece that is are in the legislation that are going to slow the rate of growth -- health spending. because if you sort of put together the coalitions of people that care about health reform, it is the people that

care about universal coverage and people that care about insurance reform and people that care about not having a fiscal nightmare at the end of this whole process. and you got to speak to all of those constituents and say, this is not a perfect bill for any of those purposes. but it is a whole lot more than anybody ever expected across the board in those three areas and, the time is now. >> so how many of you all are terminator fans? on dark thursday last week, my friend matt was on the hill and he told me he wanted to run around like sara conner shaking people, saying you don't understand, you're already dead, everybody dies. that's the political logic of passing health care reform. if they don't do it, everybody dies. all of them. they all go down. the base doesn't move. the base sees them as losers which they are.

and the other side hates the bill, and i just want to note one thing. when health care was failing last week, i surfed over to my friends at "time" magazine. and my friend, mike shearer who is a very nice guy, even if he's got a tendency to write articles like this, he wrote a piece about the 10 things barack obama did wrong with health care reform. and then michael heaven had written, the five things barack obama did wrong in the first year. one thing to know about the media, my colleagues are very bad at their jobs, you work backwards from outcomes, right? so we failed. all right, what contradicted to failure? well, it is over reach too liberal. you succeed, my depended, how did you make that happen and the five things barack obama did right. we amplify outcomes. we cannot keep things in perspective by definition of the way we do our work. we amplify outcomes, if this fails, it'll fail as worse than it was.

if it passes maybe at this point but generally speaking it'll be a better bill than it was. two other quick points. one, we should not miss here the fact that if health care fails the people that actually die are real people. if all of the congressmen did not get health care insurance unless a version of the bill went through, i guarantee you we would strike a deal. we could probably strike a deal -- [applause] you could strike a deal if you promise everybody an i pad. the distance between here and there is in the that great. there's also a moral case which i think people miss. i remember evan last week speaking that -- he said, these guys, they play need armageddon and such a clamentity to get this in their heads. he wasn't talking about people dying unneccessarily but for them to be more mod ral. these are individual human beings that have to be held

account on a moral calculus and whether or not they are and whether or not at the end of the day, and they sit down and think about tomorrow, they think, my god, i can't live with myself. if i let these people down. is -- i genuinely believe is going to play a part in this. the last quick thing. we have to be clear on what they're afraid of. it is not the bill. three know they're tied to the bill. it is the process. if if you ask them why they're not willing to do reconciliation, it is because they're afraid of being seen as a back door deal. and the reason is the process. there's nothing human beings hate more than congress, they're probably right in that judgment. but this is something presidents have had a hot of trouble figuring out so too has congress. the only way you could pass legislation is to go through this process and make everybody hate your hgs. how do you pass legislation. i think the abc that i think the bush administration when they

were being able to pass things figured out was you just bear it. you just get through it and you assume it'll be more popular when you're done. that play or play not work. but it is frankly the only chance they have because there is no -- as i said, there's no pared back bill or a magical peony that will save the democrats, it is this bill or everybody dies. >> i -- i want to ask each of you a question and i'll probably sound like a rhetorical question. if there was a role reversal, and it were the republicans who were pushing the legislation what would they be doing right now? >> we saw it in 2003 with the passage of the medicare modernization act exactly what they did. that's -- as we know, that pairly squeaked through. it was the famous three-hour vote, which is the other important point to make here. no matter what anybody tells you the rules are, they make them up as they go along. and so, particularly on the senate side.

they could -- they can pretty much figure out a way if they want to to do what they want. and that said, what happened in 2003 and this was -- there was, not even support within the republican ranks to pass that legislation. and there was a huge dispute over whether it was a massive new entitlement or whether it was, you know, privatization of medicare or whether that was good or bad, the whole bit. they were almost. there was some democratic support but clearly the caub cusses weren't going to vote for it. what did they do? they just kept at it and did a dark of fight, series of back room deals. >> what abouted budget? >> and it is end and no pay. there's a lot you could do in this town if you're going to pass a $400 billion plus benefit and not pay for it. it is amazing. even among republican who is arguably should have been crying foul as some of them obviously were. they just did it.

and bavegetly the calculus that was discussed was the one that prevailed, which is once it is done, people are going -- are going to like it. once you got a benefit in place, the money is knowing and -- and look you know, i have to say, for all of the democratic opposition and all of the argument about repeeling that and that you heard from the democratic side, they didn't do it. they haven't dean that. they haven't done that now. and nobody is talking about undoing medicare pardon d, they want to modify obviously important pieces of it and get rid of the doughnut hole and all of that, but the structure, having passed, even though many democrats wouldn't do that this way again, they're going to leave it lien because it is done. and it is something to build on. and they recognize at the evend of the day, it is better to get people the coverage than not. even if you don't like the hair brained way it happened. that's another structive point we should keep in mind in this context as well. so, i think you just -- it is exactly as ezra was saying, you

tf it out and you, and basically you get it done fast. because the longer it drags out, the more, as a cartoon in the post this morning has a picture of the dead fish and -- it is labeled health reform. and -- obama is saying, wrap it up, i'll take it. and the dead fish is just going to smell worse and worse unless you turn public opinion around and get it done fast. >> jonathan? >> yes, i mean, what the republicans would be doing if they were here now is they would have moved on the agenda and passed this six months ago. they moved fast. and actually, we're all kicking the democrats around a lot. and they deserve a lot of kicking right now. i plan to keep kicking them. i think we -- a lett of us will kick them. and i do think in fairness to them, to give them credit, you know, they did this the hard way and some ways, it is how this

turns out. it is weird to be second-guessing. it is weird to second guess health care, a, it is not done and b, because michael wins the massachusetts primary and we're having something like a victory lap here. there's a fair amount of chance that at the end, this will set an outcome or not outcome or wherever we are. but -- you know, they -- you think about the medicare pardon d and the games they played with the act water and cost estimates, this administration and congress, and they -- they produced a bill that they were determined was going to be scored by the congressional budget office as paying if itself and bending the curve over the long run in some way shape or form. and at the end of the day they didn't do a lett of curve bending and it bare my pays for itself. that's a high standard for me and made it hard on themselves. believe me, there would be no excise tax if they weren't determined to do that. the next tax is the huge sticking point to the extent there's a substantive one right

now. and i remember, and it goes to the broader way they approach it. obama fave a interview with david lien heart, it was earl my in the process when he talked about how to save money in health care and he had this long discussion and he would give it many more times about his grandmother when she was dying and sort of how you decide what treatments work and don't work and we spend so much money on things. at the end of life. and i remember thinking that's an adult conversation you're trying to have with united states of america. i was thrilled. i thought that was a great thing. it spoke well of him and i don't think i was the first to say this but i wrote at the time, it not too far ae-elite until you're pulling the plug on grandma. we are pulling the plug on grandma. i think this is a test of whether you could do it this way. and i guess, i'm not really answering the question now, in thinking about the democrats as much as we're beating up on them, i think this is important to get through and part to show that you can do that.

this is a test. can you honestly create policy in the united states of america. that's what they tried to do. whatever they did wrong and whatever people don't like about the bill. to their credit, they stuck to that. and i admire that andçó i'm, i' one of the things, one of the many things that worry me about what is happening if this doesn't pass is we'll have a conclusive verdict. you can't do it. the only way is to pass medicare part d and throwouts out the rules and ignore responsibility. i prefer we don't live in that kind of world but ipe not sure that we do. >> what would your colleagues do? >> i would think i'm a -- i was talking about this earlier, i'm a liberal with a personality of a republican. we do live in that world. i think the primary impediment change and progress on important problems is the rules of the united states senate. and i think the idea that the -- the democrats had this absurd notion that there is some

principled way to save hundreds of thousands of lives and whether or not you do it that way is more important than whether you do it is shocking, is shocking. absolutely shocking. i think one thing you have seen from this, i'm -- we'll go with that. they put a lot of time as john said into constructing a policy that would work for what is fundamentally a broken and dysfunctional and dilapidated political system. so they structured it such that most industry worse bought off and they made it very moderate. the joke is talking about this transformation how incremental and around the margins this is. we're talking about 4% of annual spending in a given year and we're not touching the insurance of 90% of americans. we really are not. we're doing much less on cost than we need to do. you had to do that and build and be incremental.

they put all of this time as they did also in a different way in the clinton years to create a beautiful delicate compromise between the visions of left and right. what they don't get, i think, what they did not do was figure out how to create a process that would then turn the american people off. that was -- i think as we look back, the -- the truly problematic mistake, they didn't i think take seriously enough what time does to legislation in the united states congress, that it is -- it is unstoppable trend toward unpopularity. it doesn't matter what you're talking about. they didn't realize with every day that goes by, the people that care about the bill are making another compromise and they like it best. and the people that hate it are low levels of enthuse jasm and the people that like it are depressed. more time is more time for deals, it is more time for my colleagues to report on process and back rooms and scandals and

-- insiding. it is all about speed here. i think that what they need to understand going forward, in not only this, the end of this process, but the next one and the one after that and the one after that and the one after that. the american people hate american politician. and that if they're going to get things done, they're going to have to prize getting things done. over the bodies in which they get them done. and i think republicans to their great credit get that. i say that without a trace of sarcasm. they're right to think that what is more -- that it is more important what they do than how they do it. they're more, i don't think they believe medicare part d was a good bill. if they did, granting them the premise, they were dead right on how they did it. it is a lesson democrats should learn. >> i want to ask each of you -- i think that -- passing this bill probably is the biggest

political impediment on capitol hill are those in the more moderate or conservative districts, the, so called blue dogs. i don't mean to suggest they're the only impediment, they're -- there are folks on left and right who have concerns about the process that we thought is the pathway to get this done. i think at the end of the day, it is the blue dogs going to be the last and probably the most difficult to come over and vote for this bill. assess their interests and how you would speak to those interests. so, i don't know who wants to go first on that one. >> well, obviously, the number one issue for the blue dogs, other than surviving in november, they're -- the substantive issue for them on health reform is bending the curve by a margin. and some way out of the -- the

fiscal armageddon that awaits us. i think that -- again, it is -- it is -- e these are complicated issues but just let's just look at what is at stake here. we have 17% of the gross domestic product devoted to health care. and you cannot pass a law that -- that moderates the growth of that. and there is no haw that could be passed that would do that. that the american people would accept. and bending the curve itself is going to be a long, long process. and the point of this bill, what is good in it, is that it lays the groundwork, assuming the secretary seizes the renays because this is contained in the words, the secretary shall but the secretary shall set up the pilot projects accountability organizations and, et cetera, and that has to be the piece that is played up for the blue dogs. and you know, so, the -- the -- if i were at the white house,

what i would be doing is figuring out a way that once a week for the next six weeks, sblingt and others get up and launch a new pilot project already with whatever executive authority they. and that's to starting to this. and start playing up the systems that do exist in this country that have already bent the curve internal to the system. they're out there. and it -- it is basically just reminding the blue dogs that this is possible and then it is going to be coming up with some kind of a -- a deal finally and you see the president now doing this, to deal with the other undone big issue, which is going to be a big medicare reform, because everybody knows, that once health reform is done, the next big conversation is -- se overall on medicare and medicaid reform. and call it entitlement reform or call it whatever you want but basically, figuring out a way to get that on a path of stability or something closer to stability

than what we have now. i think it is all about talking about those pieces and i go back to what i said earlier. you got to talk about the things that matter to the population that is matter. and for them, that is the -- the number one piece that matters. >> i think to some extent, i would of the same generic advice i would of to a liberal member of congress and i actually think to some extent it is -- there's ideological issues but there's, a hot of this is freshman versus nonfreshman, the one that is are safe and those that are not as safe because they're new. i guess i would say to the blue dogs particularly though that you have a choice here, and this election is going -- eventually is about the obama presidency and -- and how it is going. this is a referendum on this. you have two choices, you can make the choice to basically be the guy who is not in favor of the obama presidency, because he's -- he didn't support the bill which is great except i

guarantee you whoever you're running against is going to be more opposed to the obama presidency than you. you won't win the race. it was who more opposed, you're going to lose. and that's a given. and or you could try to do things that make the obama presidency and make health care reform not a liability. and an asset, and -- that's true of the health care bill generally, you know, and -- again, this is, this should work for a liberal also. there's a lot of money in this for hiring nurses and care workers and training people. and photo-op's. go to the fair and have an event when they're breaking down on a community clinic. these are good generic photo opportunities. senior cinches -- citizens. talk about closing the doughnut hole and these are good things you could do to build it up. keep in mind the effect on the obama presidency.

you, this guy, this -- the obama presidency is not going to have a good year. it is done. this idea that we could move on to jobs after it. you're not going to get more on jobs if health care dies in the mill capital is gone. and -- and the truth is that -- helping the obama presidency in the long run and helping health care reform, both are in your interest because the other decision like i said, is to run against these things, that you're in the going to be as against as republicans. you'll be losing that fight. this is your best shot. >> i think the blue dogs are probably the most interesting people in washington. and sort of the way that "lost" on television, the plot doesn't make sense and you don't think the writers can wrap this up. blow dogs as susen says, their issue is the deficit. cold and simple except when they vote to repeal the state tax and blowing it up and both tax cuts

and the war supplement. you could go right down the line and this is what makes it hard to do substantive compromise here. the issue isn't the deficit. it is perceptions of the deficit. and above that perception is a different pill. and now the problem for health care reform which was built in -- in serious respect and actually agreement with the premise, with the premise of deficit reduction is important is nobody believes it reduces the deficit. the kaiser poll 60% thinks it increases it and 15% think it decreases it the rest don't know. those are not good numbers. so, you do end up in a -- this political advice place, which i think is a difficult place to be. and because who knows? i mean it is hard to say what will help an individual blue dog in their district. the one thing i would say, it is a mistake that i think a hot of people in the process made. and the mental model of lies and take ben nelson as an example. if i'm a moderate democrat and i

want to vote for what would be perceived as a liberal view, how would do i it? i appear am biff lent on it. and i'm not a are rubber stamp for the policy. this is not where i wanted to be and we need to reduce the deficit more. and you wait a long time doing that. and then at the end you do two things. you cut a deal too make it a more moderate bill and you cut a deal to bring something back to your state or district. and then it turned out those things didn't work because what you did occurring that whole with interim period when you and your friends were saying, this is not a good bill. you convinced everyone. the constituents didn't know you were playing for leverage. they don't think it is a good bill. you cut a deal and now they think you're craving and they don't like the bill and don't like you. this is a problem a lot of them are in. but i would strongly suggest, that what they stop doing ising for on tv and this goes for all of the liberals too and all of them and saying, this bill, it is not my first choice or my second or third but somewhere over there in choices and this

bill doesn't do the things i want it to do but it is probably a good start. s of starter home. there's a complete inability on the part of democrats to stand up and say, this bill, sure maybe not where i am but this is a great bill. this is the biggest step forward we have had since the great society, this will save countless lives and prevent medical bankruptcies and chronic pain and infirmity and anxiety. and to say this is a gr bill, on the night of brown's election they had all just said, we're sorry that our candidate decideded to repeatedly insult the red sox and mock the confidence that you could touch the nesh of a voter. health care is important to the people of the country. and we would not be in this situation, and one thing is, if the blue dogs aren't the people refineding their constituencies of what is good in the bill, you got to ask yourself who is? >> i want to make an observation. i don't know whether any of you want to respond or move to the next question. and it strikes me that blue dogs

actually -- actually have the most to lose if health reform doesn't pass for two reasons. and one is, they're in the most marginal districts. and by definition, they are -- they are democrats and more conservative districts. and -- and typically, when parties switches over. and as republicans saw, in the last election, if we don't pass something, it would strike me that the folks wo are most vulnerable to losing are those in those marginal districts. and the second irony, and -- is that -- in those more conservative districts, you have got less of a safety net, and where people -- who are uninsured or underinsured. you have higher rates of people without health coverage and those are the place that is are going to be helped the moe by this by this legislation. it strikes me there's somewhat of an irony. i don't know whether any of you want to comment on that.

>> let's add the further irony, if this goes down, what is the vehicle to moderate the rate of growth of health spending. where is the next bill going to come forward that does nothing but that and doesn't deal with the other factors? so if you take them at their word that they really do care as hes ra says about the deficit and the debt, then this has to pass because there is not going to be a -- another vehicle that comes along. and to talk further about -- about the -- the contrast between what people say and what they do, if you ask the house republicans for -- for example, do -- do you like what is in this bill, do you like the independent medicare advisory -- board. and that's in the senate pill. and which is essentially, would take away from -- save congress from itself basically in terms of making decisions about medicare. and they don't like that because they don't want the power taken away from them but they want

somehow medicare to be fixed right? so if -- if we assume that -- that there are rare bleeping moments of rationality among some of these folks then this has to go forward and i think -- if there's hope, it is going to be appealing to those in the party. . . >> @ @ @ @ a)@ @ @ @ @ @ @ @ @ @ ü saying that the next things that are going to get the attention of congress before we complete health reform are the

jobs legislation, bank jobs legislation, bank regulation, and we also know that to tee up the final bill, there are some steps that need to be taken. they have not yet reached full agreement in terms of how to work out the differences between the house and the senate. they've got to talk to the senate parliament aaron -- parliamentarian of what can be included in a reconciliation bill and get a score from the congressional budget office. they've got to work out the sequencing process for passing the senate bill in the house. and the reconciliation. because there are things that need to be done. you raised the question, susan, before, about timing and it seems to me there may be a balance here. on the one hand, timing is not on our side. we don't want to move this -- have this take much longer.

on the other hand, the grieving process has not completed. and having time for a breather might actually make folks more determined to move forward. do you want to talk a little bit about the challenge of timing? >> sure. i don't believe that a breather is a good idea. i want to say one thing, i think that people in this room particularly need to be very clear on because it needs to be communicated very clearly. there are two ways that health care reform dies. and they don't look like these. here's what they don't look like. they do not look like rahm emanuel comes out and says we're not doing health care reform anymore. we don't like it. and it does not look like health care reform fails in a vote. it will die in either of those ways, i promise you. here's what it will do. if it dies. number one, rahm emanuel and other congressional democrats will come out and say we are as committed to health care reform as we always have been. this is a key priority. that's why we are in

washington. we're just not going to do it right now. that's number one. and number two, is pareback. we get some magical -- your insurance company, there are no more rescissions and this is a great victory for the american people. but that article scared me much more than anything else has so far. because the way this goes down is that it grows old and it dies. like other organic matter. and i think this needs to be called out. if emanuel is saying that it needs to be called out by people in the base and people who care about this as the death of health care reform. because you can't run that timetable. you can't deal with jobs. and i don't know -- he seems to think jobs will pass by tuesday at noon. i'm pretty sure it will take longer. they don't even have their bill it should be noted. then banking. you don't have the votes for banking, number one. bank tax is going to be your election issue, number two.

so we're going to turn to this in mid october? nobody's going to be there. and even before the summer, and everybody's already back home campaigning. this goes soon or it doesn't move. and then there's the reconciliation structure which expires. when the new budget and there's disagreement on when the new budget is taken up or enacted but either way, that reconciliation instruction, you can pass a new one but that's difficult to do. but the white house last week, and it may be john heard the same, they were telling me, the president didn't set a timetable in his speech. he didn't need to. we all know we have to move quickly due to the reconciliation instruction expiration. so this goes quick or it doesn't go. and one thing that nobody should let anybody get away with is suggesting that it is viable or honest to say that oh, we'll do this after we do everything else. but we're still going to do it. this moves or it doesn't. >> didn't you read -- i mean, we all know rahm.

he's a very smart guy. i read that as that -- what they're going to do is just for a few weeks take this off the front page. while the deal is negotiated behind the scenes. there's no lack of will in the white house to do this. and to push this forward. i thought that was all about rahm saying -- rahm is a deeply politically calculating animal. and very effective because of it. and he's saying we're going to yank this off the front page. we're going to put jobs upon the front page for the next three weeks. to shift the conversation. while pelosi and i everybody else behind the scenes figures out how to do that. that's what i took away from it. >> my understanding, and i'd like john's take on this as well, from my reporting on the white house, is that rahm wants to cut bait. that there's an argument internally in the white house going on right now, and this is -- and i've reported it so i'm

not laying on anything secret here and rahm wants to pare back. that the reason there was not a clear declaration of intent from the white house for a while after massachusetts when all those hill offices were screaming for direction, was because the white house was internally divided about how to move forward. so i think you're completely right. that is one outcome. of what we're talking about here. but i also think that it's -- that way of moving forward scares me because that is another way of saying they're keeping their options open. when you take health care reform off the front pages which maybe you need to do and it also makes it easier not to put it back on. and one thing that's hard to do is to get members' attention to go back into something hard and difficult and scary. they don't necessarily want to make a choice to kill health care in the congress. but they also don't want to do the work to pass it at the moment. a lot of them. they just don't want to do this anymore. they're tired.

they are tired of health care reform. and so i do think that there is a serious danger here that this thing dies just due to inaction, due to inertia. where it is right now it can be right there and not pass. so i'm less sanguine on this than you are. both because sthri rahm himself is less committed -- because i think rahm himself is less committed to the cause and not that they're saying we're not going to do this. it could be the timetable that you say. but constructing this new timetable where they're not just doing health care reform until they get it done, it makes it easier for them to not get it done. >> jonathan, you want to respond. >> i think it's known, i think this has been reported, rahm has always been among the more skeptical. i don't think this is a substantive thing and don't think he has anything to do against doing a big health care plan in principle and give everybody health care and it was a political thing that he has always been skeptical that this was reaching too far. and not the only person in the

white house who feels that. this has been an ongoing debate. and to some extent you want that debate happening internally at the white house. from the beginning. you do want different political views. i don't think it was -- i do worry that sending mixed messages doesn't help at a time when congress itself is at this -- do we go, do we stay, do we go, do we stay, the message from the white house should have been from tuesday night. i think that the tuesday night to me, if this all goes down, it will be the tuesday night massacre. i'm still waiting for the administration to officially get on msnbc tuesday night and say we lost the race and we're going forward anyway. i think it was criminal malpractice that they didn't have their talking points in order. but my understanding was that was -- there was a good deal of indecision there. that they weren't sure how they wanted to proceed. i tend to think the timing issue, i'll put myself between you two a litt÷e bit in the sense that i do think number one there is this process

that's going to take time. i don't think i fully appreciated that myself until recently. but the scoring, the parl parliamentarian, we can't have a vote tomorrow. we could have a vote in the house of representatives. 218 members of the house of representatives willing to vote for this bill, nancy pelosi could schedule a vote and in 24 hours we could vote and the bill could go to the president. everybody should remember that by the way. if this goes down that we are 24 hours away give or take from passing this giant health care bill, whatever you think the flaws are in it. but there is -- if we're going to go through reconciliation, you have to go through the scoring and the senate parliamentarian and round up the votes. and i do think to some extent, obviously insofaras the political push to get this through is dependent on the obama administration generally, the democrats in congress having some favorability ratings, i think doing events like the ones in tampa. i like trains. building trains. good stuff.

bring up -- that's fine. i don't think at the end of the world to have a little bit of this spotlight -- hanging on evan payh's every word and a couple of days? on the one hand, the longer we go, as -- the urgency phase. and it becomes easier to become adjusted that maybe we don't do this. and i think that's a real danger. and actually, in some ways, i was thinking about this yesterday we were all writing about what rahm said. what to say and what to think. and i was asking people who are in the middle of this, what do you think he was saying? and i sort of realize that in some ways, i don't live in washington. so i don't have the secret washington decoder ring that everybody gets here. [laughter] but my sense was that maybe one of the things that's going on here is we're seeing trial balloons. so what happens if we don't do this for a while? see how people react. and damn it, react badly. you know? no, that's not good. we want it now. we want it as soon as possible. if that push doesn't happen --

[applause] it will fade. >> the other thing we will say here is let's remember, rahm is not the president. what does the president say -- >> does he know that? >> of course, yeah. >> and i want to actually move -- i'm going to ask a question of -- after -- about the post enactment process. but those people after that -- after folks respond to that question, we're going to open this up. so we've got two microphones so why don't you start lining up and i'm foge to -- going to ask the last question preceding that. but actually, i won't actually respond to this dialogue that just went forward. because i think there's several things here. for many weeks, this is well before massachusetts, the president and the white house when they were gearing up for

the state of the union message, they had a very different assumption about what they would face at the state of the union message. they were looking to come into the -- the president to come in triumphantly, health reform would be passed, and the conversation would be moved to jobs. and the white house for months, not the last week, for months, has been thinking about this major jobs initiative. they want to focus on jobs. they wanted to focus on the budget. and so it's not surprising that that's what the state of the union message was mostly about. that was not a change as a result of massachusetts. so number one, those -- those folks who commented that health reform was not in the speech until half an hour, that was not because of massachusetts. that was long determined way ahead of time.

and indeed, that the white house had not scheduled a state of the union message for quite some time. i remember asking jim musina, deputy chief of staff, when are you going to schedule the state of the union message? and the answer was always, you know, tell me the schedule on health care reform. and as it became clear that that was not going to move quite as quickly, they had to move forward with the state of the union message and that state of the union message, the key element of that had been crafted long ago. maybe the exact wording was changed. but was crafted long ago. so i wouldn't make anything of that. jonathan, you wrote months ago about the internal match nakeses -- machinations within the white house when a determination was ultimately made that health reform would be the top domestic priority. whether it be included in the budget. and the white house was divided. and i think the white house on

tuesday night after the massachusetts election was divided. but i will tell you my view is éhere is no division in the white house at this moment about passing health reform. you know, things in the white house, when staff gets together, they may have their own internal vote. but there's only one vote that counts. and that's the president. and he really is determined to get this done. i don't think -- whatever ambiguity there was tuesday night, and wednesday, and maybe even running into thursday, and rahm was looking at small ball options to be sure, i don't think there's any ambiguity in the white house today. so i'm going to ask one last question and keep on lining up and then we'll open it up. so the health reform process in congress comes to an end. we pass the legislation. what is our main job looking forward and i'm going to ask you that, both from a political perspective and from a

substantive perspective, what is it that all of us should be thinking about are the krill cal things that need to happen if anyone wants to take a first crack at that. >> shoring up public support. explaining to people what's in this. especially highlighting the things that happen fast. the fair number of things that -- that are supposed to happen in the first year. and the more those things happen, and get highlighted, for example, preexisting condition restrictions not being held against kids. those kinds of things. that is going to be very important.

so shoring up the public support. secondly, making sure they don't repeal the damn thing. and any of you in the audience who lived through catastrophic coverage in the 1980's know that this is potentially a real threat. and again, you have a very similar dynamic at play. you had a big bill that got passed. people didn't fully understand it. and then a bunch of people suddenly woke up to the fact that they were going to be taxed at a higher rate for the provision and the whole thing came apart. basically within the space of about six weeks. intensive -- there was a longer lag between the passage of the bill and the repeal. but the real opposition to it jelled within a period of about six weeks. and then it was gone. and that is a real possibility. particularly -- we don't know what the outcome is of november. we presume the democrats will hold the house. but we don't know that. right? so making sure that it is not repealed will be step number two. number three is the implementation of all the rest of it. and this is going to be a long, hard slog. particularly if the senate version ultimately prevails and

most of this is done around the states. and just sort of working at the state level to make sure that the pieces of this that will be in the hands of the states are implemented. and i think there's going to be an extremely important role for advocates there, both in helping them to decide how this plays out but also to retain a sense of momentum at the state level to get this structure put in place. . no carrr i think even if this bill passes, we have seen we have a rusted political system that is not terribly well designed.

i think if you ever want to get the harder things on health care reform done, but also the other issues, cap and trade, entitlements, all of this, they are going to need to take very seriously the lessons that apply to all legislation that we solve in this process. i think for people who wanted to see action on america's problems, the number-one problem, obviously did not look at global warming. but i think there is a line that i like to quote. you look an alcoholic. he may be facing cirrhosis of the liver, and you may look that and say that is not his biggest problem. but it is his first problem. problem. you have to solve that problem

before you can save any others -- salt in the others. people will have to start thinking more about that long term problem. >> i agree with everything that has been said here. the implementation has been made here. there is a lot of work that needs to be done. the difference between a well- implemented bill and a poorly- implemented bill is huge. in terms of politics and policy, i am a big believer in intangibles. everybody gets the training. -- everybody gets a train to ride on. i think the things in this bill

that are tangible -- some kind of universal labeling on insurance. things like that. having and a website that people can look up things. this should not be something abstract years from now. this is a political thing, but it is important. it speaks to the process problem. if this bill passes, people who supported it should start supporting the people that voted for it. you want congress to understand that when they vote for something and it may be a hard vote, they better feel rewarded for that. there is going to be a fury coming down on them in november.

get out there and say this congressman voted for this bill. i think that is so important. in january, this will pass and people may not be happy that there is no public plan. at the end of the day, these people are going to get a fury from the right. if the answer on the left is it could have been better, no one is going to vote for these things any more. and you will not be able to fix it. [laughter] [applause] >> i want to add one thing to it and then open it up for questions. in addition to the political work that is done, there is one area that i think all of us will need to rise to the challenge. under the house and senate bills the 37 million people that will be eligible for new

coverage -- eligibility standards are going to change enormously with respect to medicaid in ways that are truly unprecedented. you will have millions of people who are going to be eligible for subsidies. we have to make sure that all of the people eligible for medicaid safety net and for these subsidies actually get enrolled, stay enrolled. we have to make sure the systems are put in place said these are enrollment-brimley systems. that is all our challenge. -- enrollment-friendly systems. that is all our challenge. i do not want to break presidents. we do these teleconferences roughly every two weeks. we get the questions on our computer screen. people lined up.

tony always gets the first question. you go first. >> is this on? we have four blue dog democrats in tennessee. only one of them voted for the house bill the first time. two of the others are retiring. one of those basically said when we ask him directly to support and pass the senate bill, the response is i always like the senate bill better than the house bill. this is a blue dog democrat that would not vote for it but it's likely to vote for the senate bill. maybe we picked up a vote. his response was which you please some people in my area that have insurance to call up

and support this? they want to hear from people that have interest and support the plan. these are from some blue dog democrats. >> does anyone want to respond? >> i think that underlines the point we have been making. political support in november. >> i will keep on switching the microphones. >> good morning. i am from new hampshire. i want to get some feedback from a session i attended yesterday when we were talking about what to do when we go home and what message to give. somebody said we should be focusing on the cost of not passing this legislation when we go home. that resonated with me because i think a lot of people, because of the lack of transparency and the way insurance companies handle the money changing, we do

not have a really good idea of what some of these issues are. and not are saying, what is in these bills? what is the real cost of not passing the legislation? i hope those in the media will consider that and comment on that or do some writing on that. >> you can see it in the scoring of the cbo. millions did not have health insurance in a matter of years. we anticipate certain things happening with respect to the fiscal sustainability of the program. if you want to live in a country where it that if people do not have health insurance. it gets more expensive and it is difficult for people who have it to afford it. employers will continue to drop it particularly in the small business community.

on top of that, it costs a lot of money. we tied a future generation to a level to having to sustain u.s. debt to the degree that no other generation has been compelled to do that. i know there are still a lot of people that still hate the senate bill. and want to go with a refrain from the '60s, if you cannot be with the one you love, love the one you are with. [applause] look at the arc of history on this. can anybody remember what the political dynamic was in the months leading up to the passage of medicare? nil. can anybody remember with

medicare coverage in 1966 and how it is different from today? no. get something on the books. fix it overturned. love the one you are with. -- fix its overtime. love the one you are with. >> i am a primary-care doctor in los angeles. my question is -- i wanted to respond to some important points that resonated with me particularly in my practice at the community health center. you mentioned how congressmen and gentlemen have to go through the stages of grief and a mile. i want to say how we have to model that and then forced this change. we need to move past that time of indignation, because that is

not what my patients need. what i have been doing is to sit there are some concrete things to celebrate in this bill. this bill will change the lives of my patients. what role do you see providers planning -- playing? we want to celebrate these things and move past the brief and talk about what really matters. >> you are from south central? >> st. john's. >> there are a lot of great community clinics associations in l.a. i think providers are incredibly

important and somewhat under appreciated by some that are promoting these bills. the single biggest way -- you are a provider, you talk to people you see. your patients have a better understanding than those in a middle-class suburban office. even so, telling people that you even so, telling people that you see every day -- it makes a difference. i also think people trust doctors, nurses, health care professionals. they will be looking to providers. whether that is as an individual or a group, you are involved locally. calling members of congress, talking to them as an organization -- they want to hear from people with insurance. most of the uninsured -- maybe

you think that does not make you very good. providers will resonate in a congressional office. they may have some clout in the community and may have some money to give me. that makes a difference. talking about what is good in this makes sense. >> it is one thing we are trying to do which i would like to talk about it on about which is the role providers complain not just for policymakers but bringing voter registration services directly to health care centers in a non-partisan way. we have an effort for we are doing just that. there are creative ways in which health-care can play a role. [applause] i think we have to think creatively and have providers come to the table and say what

do we need to do to get the votes in party and their support. we may have to bring ourselves to the political sphere in a way that is smart and savvy. >> next question. >> i am a primary-care physician and the executive director of doctors for america. many have been looking to the president for leadership. i want to get your take on his address to the gop retreat yesterday and his interaction with tom price, also a physician and some of their discussion? is it going to change? talk about his commitment to health reform. >> i think that was the most compelling political television i have watched ever.

it is fascinating because there is serious disagreement. obama would have gone down to the retreat and people would say we would like to work together. everybody would have gone home and clapped and went back to what the retooling. it did not happen. obama went down there and we have will talk. he said no, that is incorrect. your bill does not do what you say it does. your claims of tort reform is. to hold down spending. it was delivered pretty much in those words. it was fascinating.

if they do not work with us, we are going to highlight that we are reaching out and really attempt to shine a light on their obstruction. they have been doing that then you're pull -- your poll numbers like this. if they keep this up, they will not win an election. it was the first time where you say, maybe they actually have a plan. putting a camera with him in house gop and letting him sell these bills. what we saw there is that people watched it. when price cut of -- got up for others -- or others, went a couple of proposals are put in a room together and somebody is at a microphone talking about it,

you can explain the differences in one and the other. it was the first time the american people said we are watching. it was nice to see somebody saying there are real differences here. i thought that was very powerful. it was a very powerful event. >> there should be more of it. what was incredible was that after the election of scott brown, the people of massachusetts like the health reform. we just feel that we have already paid for them and we do not have to pay any more towards national reform. where were the people saying, hello, the u.s. taxpayer that throws more than 3 billion in that reform for medicaid. we enabled massachusetts to do that. we are happy that massachusetts

is on its way to universal coverage. now we wanted for the rest of us. calling out people who say these things -- maybe some of them really believe they just do not know the facts. let us not let them get away with it. correct the record every step of the way. >> we have time for a couple of questions. then we will talk to one of our board members. >> you have done such a good job of bringing these people here. i want to return to the diversity of opinions on the stage about what did rahm

emanuel say in what it means and are we going to have a couple of weeks we talk about jobs or several months. if there has been a fight in the white house about whether to move forward on health care, at this point, rahm emanuel is losing. second, while we may need to push back, inside baseball, this is one of those process stories that has alienated a lot of the public from broader health reform efforts. it did not get past process to look at what was in the bills. i challenge all of the advocates of the organizers, including the journalists to talk about lessons about what one person said and another person said in more about what is in the bills and what it

means in this particular community. >> thanks. >> i am from st. louis, missouri. thank you for sharing with us. my concern with health care reform and other legislation is what someone calls a speedy process. there is an open, transparent government and how do you balance that to insure a sense of trust. they are not all idiots on capitol hill. we can get something done. i am afraid that speedy process for set out of balance. can you address have that trust in government combined with our message of reform?

>> this is a very hard thing for people to balance. you saw it with obama who made this pledge that everything is going to be open to c-span. but of course not, everything is not one to be open to c-span. there is a reason why my fights with my girlfriend is not open to c-span. [laughter] if you open it to c-span, you have a meeting and then a back room meeting where people make decisions. if we put the age ban two-one, young people will get screwed year. but if -- these are hard trade- offs. the way the media works -- obama challenges republicans to provide answers. the whole point is to get out of that one line sound bite. it is very hard to say what i am

about to say from the view of a politician. transparency is a way people on the other side of the debate deal with issues. there is something called transparency that you can help people's understanding of it. when the senate releases a bill, it is called the chairman's mark. it is in english. people who can read a novel can read that bill. and to get an idea of what is going on. i ensure all of your legislative people are ecstatic when there is a chairman's mark up.

real transparency would be saying everybody has to release a chairman's mark. that would really change the way people can assess what is going on. there is also this type of transparency -- you need cameras everywhere you are at or spend eight months negotiating a bill. the gang of six process -- people equate transparency with bipartisanship. it is complicated. there are places where you can make real gains to help people understand all of the process. there are places where people are scoring points or what could tv. it is very hard.

public trust in the process is the ultimate goal. the american people would be much happier with a system in which things moved fairly quickly and things were getting done then a system where transparency gives them a good look. we all trapped in the sausage factory trying to get out. nothing gets done and we get upset. we say we want more transparency. >> i am going to reward your persistence. you get the last question. >> i am with the center for medicare advocacy. i was chatting with a woman on the train platform and told her

of is going to this health advocate conference. we were talking about health reform. we got on the train in parted ways. then she walked up and found me, gave me her car and tell me what the talking points are that you learn from this conference to tell my members of congress. i am asking you what are the three bullet points that detail everyone to say when we call our congressional delegation? >> will want to take the first crack? >> the richest country in the world and the leading country that does not guarantee basic health coverage for every citizen. how can we leave this legacy to future generations? this country not to the standing the fact that it does not guarantee coverage still covers a lot of people and spend a hell

of a lot of money on health care. it is unsustainable. if you look at the long-term picture over the next 75 years, 119% in gdp could go into health care. we still would not cover everybody unless we have certain laws. let us go back to some of the basic values of american life. ñri mean pre-colonialism. eight americans had the notion of doing something in thinking about the ramifications to the seventh generation. let us think about the first generation all the way up to the seventh generation. do we want to leave them as a society -- we spend as much as we do on health care. we break the backs of future generations and not everybody reaps the benefits.

there is an increasingly shrinking pool of people. shrinking pool of people. these to me are the talking these to me are the talking points. get it done. >> it was really out last weekend so you cannot hear what everyone was saying at a bar mitzvah last weekend. people were asking me what this health care bill is going to do. here are my three sentences. everybody can get insurance. the insurance is real. over time it will get less expensive. i feel like anybody can grasp those. >> if i were calling a congressional office i would say to them, talk to them and if you do not, i will not vote for you.

[applause] the 40-vote margin is not enough to do? i am not mad at you. i cannot reward this. i cannot donate to you or vote for you. i will tell my friends not to as well. future congresses, we need to punish this behavior. if these are moral people, they would have voted for this bill already. there are scared people. they are more scared about if they do not vote for it than if they did. >> we have to make sure people understand what the cost of doing nothing. what is going to happen to the additional people who are going to join the ranks of the

uninsured? what is going to happen to small businesses that cannot afford coverage? what is going to happen to seniors as the doughnut hole gets larger and larger? as you look at those things and you consider your audience, you can contrast that with what is in the bill. i think you can make a powerful statement. i want to take three remarkable people. [applause] >> and we want to thank our remarkable moderator. you did a fabulous job. [applause] >> thank you all. we go to our workshops next. we have a wonderful clothes and lunch. thank you all.

[captions copyright national cable satellite corp. 2010] [captioning performed by national captioning institute] >> still to come tonight, remarks from the ceo and his agency on making home ownership more affordable. after that, separate cases on freedom of information. then the congressional budget committee director testifies on the u.s. deficit for fiscal year 2010. i

>> tomorrow, whether the president made a mistake putting healthcare such -- so high on his agenda. >> he made health care his signature push. did he make a mistake? >> i think he did, not because it is not important, but i think the timing was not good. he had a deep hole and he could not reach as high as he needed to reach to put together the health care proposal and get through the congress. i personally would have said let's work exclusively on restarting the economic engine again and bring people back to work. i am sure the president will say he was working on that as well, but i would've said that first, health care later.

look, the president won the election, i didn't. his position is you cannot fix the economy without fixing health care. i find it difficult to create a menu of health care changes that can be enacted and say it is the problem of the president. >> watch the entire interview on newsmakers at 10:00 a.m. and 6:00 p.m. eastern on c-span. tomorrow morning on the washington journal," the christian science monitor and the latest news of the day. then jacqueline o'neill on the institute for exclusive security about the role that women take on security efforts. after that, in a recent article in foreign policy magazine that looks at al qaeda's determination to acquire weapons of mass destruction. plus, your emails and phone calls. that is live at 7:00 a.m. eastern on c-span.

>> in the nation's capital and across the country, listen to c- span radio. it is also a free application for the iphone. c-span arabia, covering washington like no other. >> remarks now from the ceo of freddie mac on his agency's initiatives for making home ownership affordable. earlier, he said the national housing market crisis had appeared to bottom out. he remains concerned over the economic impact of home foreclosures. posted by the detroit economic club, this is about 50 minutes. >> it is the second-largest source of mortgage financing in the united states. freddie mac is a leader in our efforts to keep families in our homes, particularly during this housing crisis. he has over 35 years experience

in finance and corporate leadership. it before joining freddie mac, he served as chairman and was chief executive officer from 2003 that to estimate. officer from 2003 that to estimate. as c putnam, he was charged with three organizing business and improving business policies in compliance following a series of probes into the industry's business practices. cf a magazine named him one of the most influential institute members in december to a dozen sex. it was setting his personal commitments, his work to restore certain assets of its to increase trust in the firm.

he served as chairman and ceo of delaware investment. s president and ceo of united asset management corp.. he earned his mba from harvard business school. he turned his j.d. from harvard law school. he graduated summa cum laude from dartmouth college with a degree in economics. he currently serves as chairman for dartmouth college and is on the business school of hard red and vices. faith in a warm welcome -- ladies and gentlemen, please give a warm welcome to him. [applause]

>> thank you. i am not from detroit, but i feel like i have things in common with. the automobile dealers. helping us run our family business. it is like the automobile dealers. our families often suffered as well. it was because of an unsafe building had to be written off. over the years, i remember watching the 76 and the pistons make -- play a great basketball game. many of you watched the same games. you can imagine what a thrill it was for me this morning to meet with your new mayor.

i actually got a signed basketball. i have been here at freddie mac for about six months. i took the job because i wanted to motivate our talented workforce. i wanted to help reshape and strengthen the company for a successful future. most of all, i believe in the public purpose of the company of supporting housing in our nation. despite our being in a conservatorship, and in some ways because of its, freddie mac him play a vital role in helping our nation recover from the economic and foreclosure crisis. there is a great deal we are doing to help the country, the housing sector, and america's

families. i want to help them do all they can for this important mission. the choice is a fitting place to discuss the housing crisis and our nation's response to it. i cannot think of a major city that has been more hard hit in this crisis or one whose people are more resilient in the face of it. i would like to take about -- talk about three main things today. first, our nation is working through the most severe housing correction since the great depression. i want to focus on the implications of the foreclosure crisis nationally and here in michigan. in looking at housing in the broader economy, i will look at the challenges and opportunities

for recovery. second, i will cover the top priorities our regulator has identified for freddie mac. i will discuss our work efforts to make the program making home affordable successful. i will survey some of the many other events we do to provide stability, liquidity, and affordability to the housing finance system. finally, i will conclude with a few brief thoughts on the nature of our housing finance system and the kinds of secondary mortgage market we need going forward. let me start with the view of the foreclosure crisis and then speak to some macro economic issues as well. for many years with manufacturing in decline, sub- prime billing once the rates in

michigan were among the highest in our nation. at the start of 2005, michigan's serious dilemma was the rate for sub-prime loans was 50% higher than the national average. these rate rose rapidly ending the third quarter of 2009 28.9%. today, you have plenty of company. nationally, the sub-prime and delinquency rate rose even faster. stands at 28.7%, is essentially the same as yours. michigan's serious delinquency rate among prime loans is also very close to the national average at 6.9% versus 6.3% for the nation. these numbers are painful. that is why the signs of

improvement we are seeing now are some encouraging. nationally, the macro economic data seems to indicate we are in transition to a recovery. the best estimate is at the rate of growth this year would be modest following such a severe recession may be 3.5%. the recovery will be sustained over time some main factors support this in my view. the recovery is supported by the fiscal stimulus of last year. only half of which has been spent or obligated. the fed is keeping interest rates at record lows. that is also helping private sectors. in housing, we are seeing signs of stabilization as well. the numbers will always bounce around.

from home sales to house prices, nationally, we may be approaching a bottom at last. the big downside risk to all of this is a long wave of homes fell in foreclosure potentially hitting the market at prices that are destructive. upside factors is the tax credits for home purchases that were extended through april 30. it really hail -- helps that mortgage rates are low. we we expect the 30-year fixed rate to remain between 5 and 6% throughout 2010. even the high end of that range is historically a very low rate. you may be asking yourself a couple of questions. what about employment and what about detroit? employment is typically a lagging indicator in a recovery.