what you saw happen was either in a lot of republican primaries around the country, you saw -- and i think this t party movement is vastly overblown, but a very angry group of people to are not necessarily part of the political process in the past storming the primary election polls and nominating some people that are way, way out there, with an establishment republican candidate and another republican candidate that is say, to use the political science term again, whackjobs. then suddenly -- that was a poor choice of words on c-span. if you see that happening as we speak if you see that happening,

then republican gains may not be what we're talking about, or the second variation of that, if you see establishment candidates winning most of the republican primaries, but the tea party movements or their ilk start fielding independent candidates in the general lesson that would be siphoning out of the republican column votes. .

they did not lose any senate seats, but they came within 50,000 votes of losing their majority in the senate, so then what happened to years later in 1984, he won a 29-state sweep -- or look at bill clinton in 1994. democrats got all but wiped out in that the election, lost their majority in the house and senate said they had 30 out of 40 years. what happens? he wins over senator bob dole.

look that over the last century of the elected presidents who have taken over from southern party -- from the other party. only one has lost reelection last century, and that was jimmy carter in 1980. there are a lot of really fine republicans running in 2012. at least some of them, but i do not see ronald reagan out there. there are huge things, unemployment still 8% in 2012, but i am saying, make room for

the alexian. for 20 years, democrats controlled the house. 20 straight elections, and then they lofted in 19 -- a loss in 1994. one of two things is going to happen. democrats hold of the majority by their fingernails, or they lose it. the circle is getting tighter and moving faster and faster, and i think that what tells us is the volatility out there among voters and their patience is getting less and less, and it shows they are not so dumb after all.

thank you very much. i look forward to the questions. >> we are going to take a few minutes to give him a bulletproof vest or something. i want to pick out where charlie left off. what does this mean for the agenda? i guess i will say of the outset, neither charlie or i are encumbered by an affiliation with the political party. i would start off by saying for most of us who have been doing this for a while, the concept of bipartisanship is a crock. when i hear that, i roll my eyes. when i hear people on tv say, we have got to be bipartisan, it does not work.

this administration came man with a lot of naive verite, maybe some hubris -- came in with a lot of naivete, maybe some hubris, trying to get a bipartisan deal that just does not exist. i think it is fair to say the lack of bipartisanship is equal on both sides. we got a deal on a jobs bill about a month ago, and at the last minute, harry reid torpedo if it. i thought that was a rare side of both parties working together. i think it is going to be very difficult, but before i talk about the agenda, i would just say there is a very depressing sight in this administration, and that this is the finger pointing. who is up, and who is down? is it david axelrod's fault? that is what everyone is talking

about. everyone is spinning. that is always a sign things are not going well, and in this incestuous world of the beltway, the question is, who goes after the election? who pays the price, but my own personal take is that the why south -- the white house abdicated largely to the house on so many key issues, and the idea that you would abdicate to all those old dinosaurs in the house, all those old-timers who came up with the stimulus bill that was loaded with pork, that gave talk-show hosts plenty of ammunition a year ago, and then they advocated out of health care reform, and the first bill had a very high surtax on wealthy individuals. the public auction was not well

explained, so by advocating to the house, the and ministrations set themselves up for where they are now. let's talk about the agenda. the vote were taken today, health reform would fail in the house. we do not think nancy pelosi has a 217 votes necessary. my colleague thinks she is probably at 211 or 212. there will not be a vote until she think she has got 217, and i agree that even if she gets this i think it would be a pyrrhic victory. then we have this bizarre experience if we get a bill through the house of then going back and doing reconciliation, making changes, and we will have a month or longer were the most important player in washington will not be ben bernanke orange

barack obama. it will be the senate parliamentarian, who will decide if it is humane, and i think it could be analogous, seeing this parliamentarian rule everyday to the fellow in for our county holding of ballot of to see if it is a hanging shad. it is going to be a gift from god to jay leno and david letterman to have a parliamentarian ruling on this. even if we do get a bill, there is a chance the ridiculed would be great over the next month or so. as far as other issues, there is a big issue of organized labor. a big issue for wal-mart. i think happen trade is pretty much dead. i think anything that involves a carbon tax or any kind of taxes radioactive now. no official wants to be

identified with a big tax. there might be an effort to impose different efficiency standards, but in the robust cavan's trade bill i think is pretty much dead. -- robust attack against trade bill i think is pretty much dead. -- robust cap and trade bill i think is pretty much dead. christoph's maneuvering on a consumer protection agency has -- chris dodd's maneuvering on the consumer protection agency has led me to believe he will do almost anything to get something done. i do not think there is going to be a financial-services still the industry would have of a problem with, so we see on so many of these issues, either the agenda being watered down or in gridlock, which brings me to this.

for years and years and years, we have said gridlock is good, but i am no longer convinced it is necessarily good if we start looking like grease on the biggest issue of all, and that is our fiscal outlook. i want to spend a few minutes talking about how utterly hopeless it appears to me we're going to get anything dramatically done, even if the democrats say it could begin in the fall. it might make it -- take a good beating in the fall. it might make it even more difficult. i hear a lot of people say, why don't we just cut spending? you could take the entire discursive are a part of the budget. you could take all of the discretionary budget and kill it. i do not mean freeze it.

housing, education, kill it, and you would still have a deficit of about a trillion dollars a year, because that is only 17%. we are not going to kill it. we would be lucky to have a partial freeze, so when i hear people say, let's cut spending, that is not enough. there are only three options we can look death to try to get us out of this mess. -- we can look at to try to get us out of this mess. one would be to grow your way out of it. i think the obama gdp forecast is slightly pessimistic, but you are not going to grow your way out of that. the second approach would be to look at the other 83%, which is untouchable. that consists of half entitlement, social security, medicare, medicaid. i cannot see any reasonable reform -- meaningful reform

before this election. i cannot see any meaningful reform until after the next presidential election. greenspan's seven the smartest people could get together and come up with a solution -- said the smartest people could get together and come up with a solution for social security. that is not going to happen. even this administration, which is castigated for being too far to the left, has advocated increased spending in the military by 2.5% in the upcoming fiscal year, so i do not see any big cuts coming there. the rest of it is just interest from the national debt, which is 14%, so i do not see the spending cuts being a fruitful area where we are going to whittle down this deficit of a trillion dollars or more over the next couple years, and then

we come to the most controversial of some of all, and that is, what about a new source of revenues? i would have told you had had been here a year ago that maybe there would be some new revenues. maybe there would be a way to deal with the deficit. i think charlie would agree after what happened in massachusetts, there is no politician that would talk about a tax hike any time soon. you can forget that. every couple years you can set your watch. it is not going to happen. nobody would go after something that could be demagogued so easily. another area i would have said a year ago was ripe for revenues was to go after u.s.

multinationals. there was a big push, and it was still in the obama budget. i think corporate lobbyists have made a persuasive case that to do this would make our companies less competitive. i do not sense anybody wanting to go after that, and a lot of lobbyists have said, maybe if we will move to singapore or hong kong. i do not see anything source of revenues there. even fairly innocuous change i think has dropped. carried interested, were by hedge funds can carry 15% rather than 35%. that seems to have -- seems to have stalled as well. when i look at the deficit, a surtax on the rich -- no way. any tax on people making below 200 -- i am sure larry summers and obama [pause] economic advisor is in private

lust after the screw. -- larry summers and obama's economic advisors in private lost after this in group, but does he want to make a promise he would not raise taxes for anyone making the low to hunter 50? if he makes that promise, charlie -- who make the low 250. if he makes that promise, he would make the mistake of george bush, who serve only one term. i think as we come to the end of this year, the question will be do we extend the bush tax cut for everyone? i would say it was 99% that it would expire by the end of this year. it is still probably 70-30. i think they will be allowed to

expire going from 35%, dividends going from 15 to probably around 20. dividends going from 15% to probably around 20%. i still think that's the likelier bet. but i think there's a growing movement on the hill that maybe we wait a year. maybe we don't want to raise any taxes with the economy still fragile. now, that'll cost another $200 billion or $300 billion. at this point, who's counting? add it in. add it in. so i would just conclude by saying that i certainly agree with charlie's forecast. i think the gridlock will become even more apparent. and for everybody who rejoices over this gridlock, i would have to say that, you know, i agree for now, the treasury ten year bond yield is not a problem, it's around 3.7, diane, that's not a bad treasury bond yield. but at some point the bond

market, i think, is going to have to realize that there is a lack of seriousness of the deficit. and this lack of bipartisan compromise, i think, is going to have a significant impact on yields as we go into 2011, 2012, 2013. so on that cheerful note, i will stop. >> thank you. it's been an extraordinary opportunity here, both of you, even though i'm seeing even more red. this is not a participant san comme partisan comment, by the way. it's my anger. i wanted to start out the question. i want you to line up to be able to ask the questions. but i'll start off the questioning to launch it off with charlie and greg both responding to it. and charlie, you commented about the volatility, we're seeing a lot of volatility in terms of the election. and you actually seem to be a little bit of a good thing in that. and i wondered if that contributed or exacerbated our

ability to pass legislation. does it contribute or exacerbate gridlock issues? and then on the third one and this flows into something greg says on gridlock, when we talk about deficit reduction, is there any chance of washington getting back to the five-year pay/go rules so we get some compromise over a longer period of time rather than trying to get everything crunched into one year of paying for whatever we pay. that seems to be a more reasonable way to approach it during the clinton years and we got the movement on both sides of the aisle on that. i wanted to start with you, charlie. >> i'm going to leave the substance to greg and deal with the crass politics. i think the level in washington, it's a long time coming and got lots and lots of causes. i think some of it is these members, they hardly know each other. they don't trust each other. there's no -- they have no relationships. and you could take it back to,

you know, kind of odd-sounding and tangible things like more and more members now, they just are here tuesdays to thursdays. they leave their families back in the -- in their home states and districts. and so the idea of the socialization, seeing a member from the other side of the aisle at their kids' soccer games, pta meetings or church or playing golf together. and that whole socialization process where people of different ideologies, different partisan strifes could meet off campus and get to know each other and trust each other and build relationships. i think the decline in congressional international travel, that that's actually the old adage about you don't know somebody till you travel with them. again, relationships going downhill. i think it's a product of negative -- of the advertising

that we see in campaigns. it's so much meaner and tougher than 30 to 40 years ago so that even if -- even if you didn't run an ad against me, somebody on your team did that was unfair and that was distorted. and i'm going to hold it against you and everybody on your side. and then also, i think the temperament that members of congress on both sides, they're picking leaders almost because their leaders don't work well with the other side, not because they have any capacity track record or inclination to work with members of the other side. i mean, of the nine top leaders of -- in both parties in congress, i can actually only think of two of them. one on each side that would have the slightest inclination to work with people on the other side. so i think all of that together has, you know, probably a few more factors if i thought about it came together to create just

a totally dysfunctional situation. and one that, you know, i mean our country has been through a lot. and the revolution, the civil war, reconstruction. go through it, and somehow we'll figure out how to get through this. but i can't say that i see the path right now. >> i would just add a couple of points to what charlie said. and i agree, you just don't find anyone like christopher sheas. i'd have two other things. the first is, the level of hypocrisy, going back to the budget receive sit is worth spending a minute on. let me rant for 30 seconds about this. you hear kent conrad who was one of the most passionate advocates of reducing the deficit. for years he squawked and wihind about deficits. he's one of the biggest spenders on ag programs. when you look at the number of

agricultural subsidies -- now i'll get the e-mails -- they need to be addressed. and to hear him rant against deficits to me is hypocritical. on the other side, you see richard shelby of alabama who held up something like 70 obama appointments because he wasn't getting enough pork in alabama. and he's been one who has been ranting against budget deficits. these guys and gals say one thing and do another on the deficit. and the hypocrisy. it's led to more gridlock and more partisanship. things like c-span. the fact that the nebraska deal that was cut for ben nelson was instantly recognizable and out there on the internet. the average american is far more aware of all of these closed door meetings and it's made it more difficult to get things done. >> thanks, craig. turn to dave.

why don't you go ahead? >> thank you. greg, we started to talk about something in the hall. we're going to appoint three governors, they're vetting them inside now, they delayed because of bernanke, they're delaying because of the financial reform bill. could this become an issue, the scrutiny given what you say about bond vigilantes? >> i think losing don is a real loss, you're down to one macroeconomist on the board, ben bernanke, and they have to get one or two more. maybe you can ask christine when she's here tomorrow. i don't know if they could bring yellin back or not. but there's need for macroeconomists. beyond that, the bigger issue is, could obama get a fed that's somehow compliant or easy or soft on inflation? i doubt that. i think bernanke's power is quite dominant at the feds. i think there was a feeling that

the fed was becoming too easy, they were too ambivalent about inflation, i think they would get a nasty slap in the face from the bond market, which would begin to raise yields on their own. as you all know, there are a lot of people at the fed who might squawk off the fed starts to look too easy. so i don't see that as a problem. but i do think they need more macroeconomists on the board. >> andrew hodge. fannie and freddie, there's a little theater going on there right now. just give you my 30-second recap. a couple of weeks ago, they took all the ceilings off on the potential extra funds going to them and unnamed treasury official after the new cycle friday said he didn't think it was going to be used. the republicans, of course, have

been attacking this generally and $500 billion bailout. and had put through a bill probably not get passed that to put fannie and freddie on the balance sheet. so they're warming up for the election on this issue. but looked like barney frank counterattacked here last week. counterattacked basically saying those fannie and freddie creditors aren't guaranteed. we're reworking totally new housing solutions and maybe fannie and freddie aren't part of it. so i guess my question is who's going to win this little -- who's holding the bag contest? and is it relevant to anything actually done here potentially or not guaranteeing fanny and freddie creditors and insurance? >> you know, when i talked to

people about fannie and freddie, they throw up their hands. i think fannie and freddie will stay in limbo for quite a while. i don't think there'll be any legislation dealing with them for quite a while. i think that what sounded the alarm here on cnbc on friday. and i think it is a serious issue down the road. but i think for now, they're just going to kick that can down the road. i don't think there'll be anything on that this year. >> my job is to forecast the economy and stock prices and more stock prices in the economy. and as you know, the stock market's pretty strong, most economists are being more bullish. what impact, do you think, would happen if the economy and the stock market continued to do better? do you think that your opinions that you get from your recipients when you take these? do you think they could change

dramatically if that would take place? >> i don't think there is much relationship at all between how the stock market's going and votes. there's just -- i mean, just sort of look at how, you know, the market has come back over the last year. and look at how the anger has gone up. i'm not saying there's an inverse relationship because that's kind of nutty. but i'm just saying that there isn't a relationship. and so i don't think -- i think the market -- it could theoretically go up substantially and not change. i don't think it's likely to change the outcome. the only, you know, for the average voter out there, they don't know gdp from stp. they really don't. and the only number they're actually even aware of -- they may or may not be aware of the dow jones industrial average. but in terms of politics,

they're really only aware of unemployment. and even then some political scientists have pointed out that there's not a direct relationship or close relationship to an unemployment and midterm election results. but the catch with that is we've only had once in the post world war ii era that you had unemployment over 10%. five z a idea of having less than 10% of unemployment for a solid year is uncharted territory. i think if the market continues to grow, i do not think that would change how i look at it. it would have to be unencumbered -- accompanied by unemployment dropping substantially before i would say that changes how i think. >> i work with a wonderful gentleman many of you know. i travel with lyle, and he tells

clients it looks like we're in a sweet spot now. we have a moderate economic growth, low interest rates, virtually no inflation. that is a but if you talk to retail clients, and when i say this, people look at me like i am on drugs. the average american and a lot of average investors who never believed in a stock market rally are very skeptical this rally is for real or the recovery is for real. it is such a pervasive attitude. i think it will take months of good data before it starts to turn things around. i think it is the unemployment more than anything else. get all the years i have been doing this, i have never seen a dichotomy between the average american and people who do see a recovery that is under way. >> i have to add we are all

looking at obvious issue, and that is home values. that is the largest asset most americans hold, and those are still going in the wrong direction. going in the wrong direction and not in the right direction of wealth. before we get to our next question, i want to throw this one out to both of you. you both brought up the lack of sort of bipartisanship is not the right word, but the lack of cooperation, the lack of socialization. and i thought that was very interesting because i know many years ago i heard someone from illinois talking about how they would all drive back to illinois. didn't matter who they were, and i don't want to hold up illinois politics as a stellar example. although greg has told me that new york has gotten worse than illinois with its governors. and i can only welcome that to not be in the high rankings of our governors. i know that barack was originally from hawaii not illinois, which was one of his saving graces. is there any way of curing this mistrust that has developed?

we know it's many years in the making, but i don't see any end to it. isn't that almost something in our national policy we have to address now? >> if i could wave a magic wand, i think i would do a couple things. number one, i would push through meaningful redistricting reform so that rather than, i mean the cliche is now rather than voters picking their elected officials, we have elected officials picking their voters. and with basically custom-tailored districts where this one's designed for a democrat, and this one for a republican, and in some cases designed for specific people. and that creates ideologues in both sides. when i move to washington in 1972, you had a heck of a lot of conservative moderate democrats, a lot of liberal republicans and for whatever reason that's changed, the overlapping was tremendous.

kept their party from lurching off to a ditch on the left and the moderate republicans kept their party from lurching off to the right. i think changing the schedule of congress in terms of their work to incentivize. that could help, i think, i'd like to get them around the world a little bit more so they're more aware and meeting with business leaders from around the world. meeting our military commanders all over the world. so they're a little bit more aware of that around them. i think that would help enormously. and i forgot my other reason. >> i'd just make this point. i always was very dismissive, scornful of term limits. i'm beginning to wonder if maybe we should dust that off again. and i have to note. i have to note that when you had

charlie rangel replaced, he's 79, we placed by pete stark for two days, he's 78, now replaced by sandra evan who is 78. these guys don't get out much. they don't -- and what better example could i point to than here you have the senate that majority leader saying barack obama speaks well for, you know, he's a light-skinned negro -- i haven't heard anyone use the word negro since 1974. you have to wonder, do these people get out very much? i think the lack of term limits may be a problem. >> i feel compelled to add, though, you know, you move around the country and you look at the states that do have term limits. and i would say what is the most dysfunctional state in the united states? california where term limits are alive and well. i think it's like clear cut -- i

share greg's frustratius frofru >> i always wanted them to stick around long enough so they can take responsibility for what they messed up. but that's my own bias. >> and you guys are talking about the threat, the tea party candidates could split the vote and i happen to go to a tea party and threw a little tea bag in. i find people are concerned about a government taking away their freedoms to make a lot of decisions. and i see a lot of people all over this country afraid that the government is going to print so much money it destroys the value of their savings. they don't know what to do with their money. and so, i'm curious what kind of political advice you could gi give -- forget the labels, tea party or anything else. for the people in this country that are scared that their government is taking their rights and freedoms away, whatever those might be and they're scared the government is not going to do what they said like you said to take the bull

by the horns and limit spending. and they're afraid of their savings being destroyed. what kind of advice can you give them so they don't get marginalized in front of c-span and everybody else as whack-os. because i think freedom and the value of your savings is not a whacko issue. >> the two pieces of advice i would give them is number one, restrain the rhetoric when you're in front of a microphone screaming at the top of your lungs with your veins and your eyeballs popping and your veins sticking out of your -- i mean, that kind of scares people a little bit. and that undermines effectiveness. sort of tone down the rhetoric a little bit. and the second thing would be to select when you're picking candidates, select the person you think that can bring the most amount of change but still have some realistic chance of

getting enough broad-base support to win an election. i mean, the purity -- purity is great, but purity doesn't win elections in a lot of places. and that, you know, don't let the perfect be the enemy of the good. and having a candidate that embodies everything you believe in who was destined to lose in a general election doesn't really move the ball forward very much. and so they, you know, so i guess the -- to sum it up, i'd say dial it back and you could be -- you can have an impact. go full throttle and you will be marginalized. >> i just disagree slightly with something charlie said a few minutes ago. he thought maybe the tea party was a little overrated. that it won't have that much influence. i think they're being heard very clearly in this city. the republicans certainly are. they want to co-op them on as many issues as possible.

after the massachusetts race, which was a stunning result to everybody in this administration. the best line i heard was on saturday night live, they said martha coakley was such a bad candidate she would lose to dick cheney in berkeley. but at the same time, i think the reaction by the white house spoke volumes. they went almost populous against the banks. if you recall that week, january 19, brown won and within days you had harsh anti-bank rhetoric. even the democrats let alone the republicans are hearing the message. i agree with charlie, if you look a little -- if the party looks a little less threatening, moves a little bit more to the center, it's going to have a big, big influence. >> let me clarify. i've got a column coming out tomorrow. to me when i think the tea party movement i think is overrated, i think they're kind of a tip of an iceberg. i think they are representative of a much broader group of people who aren't going to

meetings and who aren't screaming in the television radio talk shows, but who are disaffected and who are expressing their concern. these are folks that you will never be able to explain t.a.r.p. to them, never be able to explain the necessity in my mind for the takeovers and some of the bailouts. the thing is, these are some of the things that i personally think were essential but can never be adequately explained to a lot of people. they're just never going to accept it. but the thing is -- i think the tea party becomes a convenient label for a much broader group of people that are not quite, you know, they're not quite as vocal or not nearly as vocal or visible, but the polling data suggests it's a big group that's out there that's quite unhappy. and i think those people -- i'm not diminishing their impact at all. >> one last question from jim -- >> really quick.

>> go far out in your crystal ball, election is over, november 3rd, republicans won the house and at least dramatically reduced the democrats' majority in the senate. who's the speaker of the house next year? and, you know, and the next two below. and two, is there any chance of that happens that we get a lame duck session that would actually approve the pending trade agreements with colombia, panama, and south korea, which would add a lot to economic growth. thank you. >> oh, lord -- >> and you've got about 30 seconds to answer it. i shouldn't have let jim give the last question. >> let me just say, if republicans took over the house and i know there are a lot of sort of young rising stars on the republican side. but i would be very surprised if they took the speakership, the gavel away from john boehner.

he was the field commander. and, you know, i'm not sure he'd be there forever, but i couldn't imagine they would take it away from him, you know, if they were victorious. if democrats were to lose their majority, my guess is that nancy pelosi probably would head on back to california or wherever before too long. i don't think she'd want to hang out as minority leader to be perfectly honest. and there's just a whole cadre of rising stars. i think you'd be looking for generational change. >> the brightest of all bright lights is paul ryan in my opinion. he's a very likable guy, intriguing fellow. he's someone clearly to watch. i'd just answer the question this way, which way does barack obama go after the butt-kicking that the democrats are going to take in november? does he decide he wants to do a bill clinton and triangulate? does he want to be like a tony

blair and play small ball and get modest things? bill clinton got nafta, got welfare reform, clinton did get a few things done. does obama want to go that way? or is he as his detractors claim a very cerebral law professor who doesn't have the guts for politics that bill clinton had? the jury's out on that. >> i think one thing, when you look at what we're seeing, one thing is because of these campaigns, democrats are absolutely terrified of raising revenue. republicans are terrified about cutting spending. and that's sort of the policy paralysis we have. that they've been so stigmatized by negative advertising that neither party seems willing to do what good put these two parties on the planet to do. and democrats define revenue and republicans to cut spending. and that sort of the bottom line where we are right now.

and i don't know what changes that. >> a crisis and there isn't one. >> thank you. i want to give a big round of applause for charlie and greg. and on those final notes, i know now we're moving into deficit >> coming up, the prime minister of greece talks about his country's debt crisis in relations with the united states and europe. then the economics of health care, and later, the obama administration's immigration enforcement. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] >> tomorrow, a look of the obama administration's efforts to reduce foreclosure with john taylor.

we will discuss gris's debt crisis -- greece's debt crisis. live at 7:00 a.m. eastern, here on c-span. >> over 1000 middle and high school students entered this year's student chem documentary series with a short video on one of our country's greatest strengths or a challenge it is facing. we will reveal the winners on march 10 and show you the videos. >> the prime minister of increases in washington this week for an official visit with president obama. george papandreou discussed his nation's economy and the relationship with the united states. this is about an hour and 15 minutes.

>> good morning to all of you. i'm strobe talbot. welcome to brookings. welcome to spring in washington. >> good morning. welcome. come especially to the washington diplomatic corps, which is particularly well represented here today. and i might add that the athens diplomatic corps is pretty well represented, too. by dan specker, united states ambassador to greece, a very dear friend and former colleague of mine and several other people in the room. this is going to be an especially timely event. and it features an especially distinguished guest of honor. americans like to think of their country as the world's oldest modern democracy. going back all the way to george washington.

well, the george who is with us today traces his political heritage back. prime minister papandreou is a leader not just of his own country but a leader of europe. he is a champion for everything that's everything that's good, everything that's best about the idea and the institutions of the international community. he's also a great friend of the united states of america. he has many personal friends in this country, in this town, and the white house and the department of state. and in this room. and i am proud to be one of them. back in the 1990s, i worked with him on some of the most challenging issues of that period, some of which are all still too much with us today.

he was then and he is now a statesman, of rare discipline, ingenuity, integrity, and i want to stress this word particularly, political courage. he was then and is now a problem solver. and it was in his capacity as a problem-solver that he decided on assuming the prime ministership of greece to retain at least for a while the portfolio of foreign minister. so that he could follow through on his commitment to resolve long-standing regional issues so that greece can play a larger role on the world's stage. as a problem-solver, he's also got his work cut out for him on another front, which is to say the home front.

when the ambassador, bill, and martin and i saw him in athens last october, a week after his election, prime minister papandreou knew then that the biggest of the problems his country was facing were its troubled economy. and those troubles, of course, are linked to the troubles of the world. and, of course, there are consequences of the financial earthquake of 2008, whose epicenter is here in this country. like president obama, whom he will meet tomorrow, prime minister papandreou inherited a crisis. but my guess is when the two of them meet tomorrow, they will not spend much time commiserating or looking backwards. rather, they're going to

concentrate on coordinating and cooperating and looking forward. we look forward to hearing whatever he wants to share with us about how he and his fellow leaders will meet this challenge. following his remarks, our brookings colleague and another -- the prime minister's many friends in the united states kamal dervish will moderator the discussion. khamal successfully managed a financial crisis of his own as finance minister of turkey. so, ladies and gentlemen, please join me in welcoming to the podium the prime minister and foreign minister of greece, george papandreou. george? [applause] >> thank you, strobe.

it's an honor to meet here again in this great institution. and, ladies and gentlemen, dear members of the diplomatic corps, it's great to be with you and particularly to see paul sarbanes here, a very old and good friend for many years ago. and we've been working together. and his contribution to the united states, of course, but also to greek-american relations has always been paramount and very important. and i'm very happy to have khamal dervish here as a moderator. ladies and gentlemen, 53 years ago this week on march 12th 1947 president truman rose before a special joint session of congress. he was there to warn america of a looming new crisis. a crisis that revolved in part around greece but was, in essence, a european crisis.

one that directly affected america's interests. in that speech president truman introduced a vision and laid down the sturdy foundation for policies and institutions such as marshall plan and the bretten woods arrangement that allowed us to rise above the crisis and build shared peace and prosperity. so today i have come to washington this week to speak about another crisis in europe. this crisis, too, revolves in part around greece. this crisis too very much involves america's interest. and as in 1947, if we act with sufficient foresight, i believe this crisis also contains opportunities, great opportunities to strengthen our respective countries and our shared interests for decades to come.

what is this crisis. i would call it a crisis in global governance. as we bask in the triumph that the end of the cold war symbolized for the west, we forgot three important elements. first of all, the world's problems were not over. no. history had not ended. new conflicts, new issues and new complexities of a globalizing world arose. secondly, we underestimated our own dogmatism while those on the other side of the iron curtain worship state-run economies as master, we had created our own masters. the free market, the master and the masters are not to be tampered with. they rule. forgetting that in democratic politics, our master is the people. and both states and the market are there to serve them.

thirdly, we neglected our transatlantic relationship. either by paying lip service to it as something as a matter of fact or something irrelevant to the new challenges of the time. so off we went with our respective, often narrow politics as the world was changing and as the balance of power was shifting. that has undermined the extent to which our common values remain a dominant force in the shaping of this new globalizing economy and society. values such as democracy, the protection of human rights, the rule of law. the core of the crisis is that today the international community seems impotent. impotent to deal with the complexities of an

interdependent market or for global warming or energy resources or the spread of violence, terrorism, and the proliferation of nuclear weapons. or an inability to deal with protracted conflicts like the ones in the middle east. my conclusion is that cooperation between europe and the u.s. must be revitalized to empower our countries, societies and our citizens so as we deal with these issues effectively and democratically. how does this relate to my country, greece? you are all aware of the financial crisis greece has faced in the recent months, the crisis that confronted me when i became prime minister last october. after we took office, we discovered that the budget deficit was actually double. double what our predecessors had told us, told european authorities and the greek people. so our announcement of this discovery rocked investor confidence, not only regarding

the finances of greece but also the soundness of currency that we share with our european neighbors. all of you understand this crisis like wall street's original crisis in 2008 risks spreadly more widely. many worry it could reignite a global financial crisis and produce a crisis 2.0. that's why in the past five days i met with chancellor merkel and president sarkozy and previously visited with gordon brown and jose louis paterro how to deal with this ongoing crisis and how to prevent it from spreading. and that is why i will meet tomorrow with president obama not only as a greek leader but also as a european leader to discuss the important role i believe the united states can play to ensure greece, europe, and america that we remain strong and healthy partners. let me exemplify the greek case.

i stood for election last fall before a country that was demanding deep changes during the preceding five years our public had grown increasingly alienated as greece's national deficit ballooned. wasteful expenditure mushroomed and our gdp shrank. during our election campaign, we promised to tackle head on the chronic problems of the heart of greece's economic woes, structural problems that we often politicians had avoided addressing for so long for such a long time. our goal was and remains to transform greece into a thriving economy driven by green technology and investment in our natural and human resources such as education and health. so when my party won a resounding electoral majority, we knew our mandate like the mandate of your own president,

your new president, president obama, was to bring deep changes even at a time of great economic challenge. now, i am used to change. i was born in minnesota and raised in california before eventually moving to athens. and then when my family was forced to flee the dictatorship we lived in exile in canada and in sweden. and throughout my political career i have often taken office during times of crisis. as strobe mentioned earlier. i became education minister during a teacher's strike. i became foreign minister just as greece was entering one of its most fraught standoffs with turkey. i took over as leader of my party in 2004. just a few weeks before an election that we were quite certain to lose. and now i have become prime minister during the greatest economic crisis greece has faced

since the second world war. so confronting upheaval and the need for big changes has been an intrical part of my life. even so, that doesn't make change any easier. the enormity of the deficit made deep changes absolute and now the changes are underway. to restore confidence in our country and stability to our economy, we pledge to bring the 12.7 deficit down to 8.7 this year. and to the e.u.-mandated levels of 3% by 2012. to meet those targets the parliament has adopted the toughest austerity measures in greece's modern history. the third round of those measures passed just last week on friday. and we know greece faced not only a fiscal deficit but i would call it a credibility deficit. as a matter of fact, i call that the biggest deficit we had.

as a result of the fabricated budget figures our predecessors had published. so our partners in the european union were understandably skeptical about our promises to rein in the deficit and crack down on issues such as corruption. but today we are demonstrating the decisiveness of greece. public secretary salaries have been cut. retirement ages ra they have come with high political and social costs. we have to not only rescued our own economy but to prove our careers and credibility. we do so also because we are part of a genuine community -- the european union, and all these measures reflect our commitment to protect the stability of our common european currency. this medicine may be better, but

it is only an immediate remedy as we must deal with other core problems that prevented greece from reaching its great economic potential, and there is great economic potential, for far too long. in 2010, this must be a year of drastic reforms across all levels of government. changes in our tax system, our social security system, our public education, our health system, and our development model. at the top of the list is tax evasion. i will give you just one measure, fewer than 5000 greeks declare income of one of 2000 euros or more, and that must end and will end. we will be prosecuting offenders to show we mean business.

rule of law means the law applies to all. such changes we are sure will bring in billions of unpaid taxes and health our return to fiscal health. return to fiscal health. we are also tackling challenge of corruption head on. within the first weeks of my administration, i dismissed a deputy minister and friend who was trading minor favors for voters. corruption, of course, is highly unique to greece but it is a problem we are determined to address as part of our broader reforms. to usher in a new norm of transparency, we are televising our cabinet meetings. we have launched an open online application process for public secretary jobs even at the highest of levels. and passed a law so that every government expense will be published online, a first in europe. every signature from mine to the civil servants in local

government will be online. we post all our proposals on the web to allow for deliberation and participation in a web 2.0 application which empowers our citizens, puts a check on lawmakers and strengthens the qualities of our policies. these are among the changes my government has made and will pursue in response to this crisis. so i'm confident that greece will very soon be a paradigm of open government, a leader in green development as greece has great untapped potential for renewable energy but also a real magnet for new business investment. ...

>> we need regulation and foresight. my own people, the greeks, understand this. the majority of greece recognize the very difficult changes we're making our in our own long-term interests. and there is wide public support for these reforms, and i would say much more than in previous times in my country. i see this every day. even those who have volunteered to help, such as well-known singer, who has given her

attention back to the state, who says, who spoke about greek, a word that is difficult to translate but means a sense of pride, a sense of honor, and giving to the common good. europe, on the other hand, needs to recognize the measures we're put in place and those still to come need certain time to take effect. countries are not like financial markets. social change cannot be executed as swiftly as credit default swaps. you cannot sell short on social commitments and political responsibilities. so although there are great risks in the current crisis, there are equally we'll risk in expectations and inflammatory and patients. something we have seen in the press around the world. so it's dangerous to push people to hard and too fast. for example, greece has or has one of the lowest wages in

europe. the average ways in greece is just under 24,000 compared to just over 40,000 in the u.s. we intend to reform our economy with the help of our citizens, not in spite of them. and here, this is where europe needs to join us in taking a longer view, because certainly we need our budget cuts. but at the same time, we need to have sustainable economic growth. and if we're not careful both higher taxes coupled with lower revenue could actually slow down our recovery. that would be both unjust but also could create a lot of social unrest. deflation is also a genuine risk. if we don't take your love measures to kickstart productivity, and create new jobs. this is not about asking europe to rush to the aid of a reckless country. on the contrary, standing by greece as it makes deep and responsible reforms is in the

interest of europe as a whole. and this, i think, is now understood by the leaders, the other leaders in the european union. so the price of not acting together will be higher taxes, higher unemployment, a slower economic recovery, not only for greece but for all in europe. so greece may be doing all the right things to revive our economy. but not everyone may want us to succeed. and this brings me to my second point. they need to address the threat of speculation and ill regulated financial markets. a threat that imperils not only greece, but the entire global economy. i see that threat every day as we manage this crisis for the immediate problem we face is not dealing with the recession, but in servicing our debt. and despite the deep reforms were making, traders and speculators have forced interest rates on greek bonds to record highs.

many believe that there have been malicious rumors, endlessly repeated and tactically amplified that have been used to manipulate normal market terms for our bonds. partly as a result, greece currently has to bar at rates almost twice as high as other european union countries. so when we borrow 5 billion euros for five years we must pay about 725 million euros more in interest than germany does. it would be like, let's say, california having to borrow at a rate which, 5 billion euros, which would mean they would have to pay 725 billion u.s. dollars more than another state in the u.s. when you have a common currency, that is simply not viable. so we will have a very hard time and implement our reform program if the gains from our measures are simply swallowed up by prohibitive rates.

this whole affair has a horrible sense of déjà vu. the same financial institutions that were bailed out with taxpayers money are now making a fortune from greece's misfortune. while those same taxpayers are paying the price in deep cuts to their salaries and social services. so on principle specters are making billions everyday by betting on the greek default. all this may sound a bit familiar to american ears. and unlike the bankers, greece isn't asking for a bailout. let alone a bonus. indeed, we have slashed the salaries of every single government official. i myself cabinet members, have all taken significant pay cuts in our salaries. yet our correct decisions may still be undermined by speculation, and to me this is a challenge to our democratic institutions. an elected government making huge changes with the consent of

its people is being undermined by concentrated powers in an unregulated market, powers which go beyond those of any individual government. a further point is that even though greece accounts for just about 2 percent of gdp of the european union, our economic conditions can have a far larger impact than that figure in flies. and ongoing euro crisis could cause a domino effect driving up borrowing costs for other countries with large deficits and causing volatility in bond and currency rates across the world. a small problem could be the tipping point in an already volatile system. we should remember that the great depression in the u.s. was followed by a second recession in 1937 and 38 that derailed the world's recovery, and prolong the crisis. so if the european crisis metastasizes, or any other crisis around the world, it could create a new global

financial crisis with implications as great as the u.s. originated price is two years ago. so for america, a weak euro also means something else. it could mean a rise in dollar, that in turn means a rising u.s. trade deficit, which will not help america's economy rebound. if the e.u. still america's biggest trading partner should falter, the consequences here would be palpable. that's why europe and america need to work together to say, enough is enough. to the speculators, who only place i on the immediate returns with utter disregard for the consequences of the larger economic system, not to mention the human consequences of lost jobs, foreclosed homes, and decimated pensions. these market manipulations, which were at the heart of the banking systems collapse, are still legal practice. so it's hard to fathom that we have allowed this to continue after what we went through.

it is common sense enforced by in church regulars that a person is not allowed to buy fire insurance on his neighbor's house and then burn it down to collect on that insurance. yet that is exactly what is done in the market for credit default swaps. this malaise has led banks to foreclose on the homes of millions of americans, but this malaise now haunt not only greece, but all of us. but if europe and america jointly stepped in and shore up global financial regulation, and find regulations, we can curtail such activities. and it is encouraging. it is an encouraging sign that the american authorities have ordered some speculators not to destroy records of their trading in euros. and i would encourage u.s. authorities to continue these investigations. since the 1980s, we have witnessed a succession of global

financial crises. the third world debt collapse, the u.s. savings and loan debacle, the asian financial crisis, the high-tech and housing bubbles, and now the worst over recession since the 1930s. globalization which promised so much and opened so many doors to those of us with the good fortune of advanced educations and careers has also brought new inequalities and new risks. so this crisis is an opportunity to correct many of the ecstasies of the globalization. it calls for deep structural changes, changes to our global institutions, to our system of global governance. at the g-20 in copenhagen, and at the meeting in copenhagen for climate change, we did fall short of our citizens expectations. we fell short of our own rhetoric. so we can't afford to squander another opportunity to make the critical changes that our

current reality demands. this crisis should be an opportunity for decisive and collective action, for regulation which is urgently required if global economic growth is to be sustainable. we need global coordination of monetary policies, and if we let market forces alone dictate the terms our economic recovery will almost certainly slip into reverse. i just arrived from paris before that i was berlin, in berlin and in luxembourg. together, with my european partners, we have taken a common initiative to strengthen financial regulation. particularly, these are the, speculation. we need clear rules on short, thank you shorts and credit default swaps. so i hope the to be a positive response from this side of the letter to bring this initiative to the g-20 and its next meeting. i know that some fear the word regulation. they claim that regulation

curtails our freedoms. but i would simply say that it's like saying that we should go without traffic lights as it slows down our cars. so let's make the markets work for us. all of this is possible if we, greece, europe, the united states, have confidence and trust in each other as partners. there was a debate for some time about whether the european union would work and then whether it was better for it to be week or strong, particularly vis-à-vis the euro. >> even now there are debates about whether the new europe is a force to be reckoned with, it's global roles strengthened by our new president and high representative, or whether it is a non-entity of a continent disappeared off the map, as "time" magazine would have us. my view is that the world needs more europe today, not less. in saying so, i would like to

say that europe, the european union, as a model, as a prototype is very interesting experiment in a globalizing world. a world which is a need of a more humane globalization. we are a political union of 27 we are a political union of 27 nations@@@@@@@ @ @ @ @ @ @ @ @ r

europeans, and backed by an economy larger than america's, is perhaps europe's greatest achievement. the euro has been called a postmodern or a post-sovereign currency. whatever we call it, we european leaders must now show real leadership to prevent unbridled market forces from hijacking this success story for their own ends. i'm confident we will succeed, and we cannot fail. this is reason to have confidence. there is reason to have confidence. in my country also during this crisis. we have shown determination and i think this is a sign which shows that we will be ready to use this crisis as a real opportunity for change. i say that because a decade ago when i launched the process of

greek turkish as foreign minister, everyone said that it was doomed to failure. but our countries are closer than they have been in centuries, and there's no better symbol than the fact that my good friend, kemal, is moderating this discussion. i also look forward to turkish prime minister to athens in the coming months. i believe we can make new breakthroughs in our relationship and become a symbol of stability in eastern come in the eastern mediterranean and the middle east. prior to the athens olympics, so many voices at greece would fail. but we pulled off one of the most secure and successful games in history. today, we will be using this legacy to revamp athens and our public administration. and so we will overcome this new challenge and we will do it with the cooperation of our partners in europe and america who have stood with us on so many vital

tests. for this new crisis is a moment of great opportunity for greece. a chance to modernize and revitalize its governance and development model. for europe a chance to become more fully integrated we're talking now about more coordinating economic governance, for example. and for the world, this is a moment to move towards greater democratic corporation at a time when, once again, the global power of poorly regulated markets is proving dangerous for us all. yet well-regulated markets can truly lift our people to new heights, and our economies. and at its heart our economy faces a very ancient challenge, which i would like to simply conclude with. before the advent of democracy, greece's city states were ruled by rich and ruthless who belonged to powerful interrelated clans, not altogether unlike the mergers

between powerful financial institutions that dominate today's global market. play-doh been made a critical remark about a system controlled by of a minority elite. and he characterized the system as one where and i quote, just or right means nothing but what it is in the what is in the interest of the stronger party. not the rule of law, but the law of the powerful. so we have a shared responsibility create rules and institutions that can provide a more just and sustainable answer for our planet. let me take you, in concluding to the parthenon as i finish my speech. if one stands by the parthenon and looks down on athens, you will see not only that museum waiting for the return of the parthian marbles. on the other side you will see the ancient market.

that in greek means two meanings. it means marketplace, but it also means public speaking. a place of politics. so ancient greece should guide us here in saying that the market is and must be part of the realm of our political decisions. and we have separated the two as if they are dumb as if they can be separated. if you look over the hill to the other side, you will see, each and every citizen will stand on a rock, speak and be heard. politics in ancient athens was participative. everyone have the power to be heard. so we must use the new means we have, such as the internet, but not only, and our globalized society to empower our citizens and give them a real voice in politics. and that's much more than just a

technique. it's a question of political will. as you look towards the sea, you will see the islands of the aegean. an agent is comma every eye was the country into itself, a city state. yet they all were aligned to a common purpose, the protection of democracy and, not yours. so let us use our countries as a vast, let us see our countries as a vast sea of diverse islands linked by a common set of values. and that is what europe is trying to be. the ancient philosopher socrates said being greek is partaking in greek education. meaning very simply, sharing a common value. greece has long been america's partner in values and in history. we are determined to be an ever stronger partner for the u.s. in world affairs, and commerce and in culture, and security.

so now i ask you to stand with us and work with us again as what each confront our own challenges of change, as we work together to realize our shared interests and a strong europe and a sound global economic system. thank you very much. [applause] >> mr. prime minister, thank you very much on behalf of all of us in brookings and discrete audience here for this powerful

speech. let me start the discussion by asking, how did things happen so quickly, six months ago there were difficulties, but there was not a major crisis? i have known you many years. i have had the honor of working with you in various seminars and workshops that you always stressed the importance of transparency. citizens are to the patient. what role do you think the lack of transparency has in the emergence of this crisis? >> thank you, kemal. i think when we're talking about this financial crisis, we should see that it is a challenge to our democratic institutions. politics around the world, we representatives of our people, sometimes or often tasked and seen by our people as all

powerful. but, in fact, there are parts much stronger than us. and in other parts of the world, and corrupt politics, and other parts of the world can simply lobbied enough to change politics. but what will very often undermined the will of the people, if you like. and what we have had and we have seen in this financial crisis is that they were all kinds of innovations, as they were called, or all kinds of practices, which were too opaque, to nontransparent for first of all, us to understand but then to actually see and if we were able to of transparency, i would take immediately we would've had much more possibility to prevent the crisis as it unfolded. increase, particularly we had

lack of transparency, even to the point where we didn't have the right numbers of what our deficit was. and a lack of transparency there also has at times allowed for decisions, which are client list, more based on party politics voting, not meritocratic. voting very often the public sector as becoming part of a party machine rather than part of an engine to help both growth but also protect our citizens rights. but also it helped to develop a lot of corruption, corruption from the local, the grassroot level, day-to-day level and civil services all the way to the political level, to a higher

level. and that's why transparency, for me, is very important because what it does do is, first of all, it exposes these possible wrongdoings. but secondly, in a democratic society a sickly gives our citizens and our different bodies, part of the democratic, part of the democratic process whether legislative or executive or judicial bodies, to be able to apprehend and to control these types of activities. so bringing back transparency, or bringing transparency to our system is, i think, one of the prerequisites, not only to deal with a crises such as the financial one we felt when we went through, but also it's a way of giving and empowering our citizens again to be part of our political life, and not feel alienated from the decisions we often take. >> usage are going to televise some are made all of your cabinet meetings that i think

we're going to do a sessions at brookings watching one of these cabinet meetings. [laughter] >> i think that will be great. now at the time of crisis, sacrifices unfortunately needed, and i know you are taking very tough measures, 4 percent of gdp in one year. trouble is, budget cuts. and unfortunately, the sacrifices for even on people who were not that strong, not that wealthy, although i'm sure you are trying to make everybody pay their fair share. but as the recovery will come, these things will recover, they have been many expenses of crisis am and it looks terrible but then two years later all of a sudden growth is back. but often what happens is the fruits of that recovery are not very well spread. do you have already any thoughts, i know it's hard that you in the middle of this crisis, but thinking of how to make that recovery benefit really the average citizen

increase? >> thank you, kemal. you've gone through a similar crisis in turkey, and you know what this means. i think the basic prerequisite for people to be, they feel that they can actually support, even though they may not be happy and we're not happy with these measures, but they can support these measures, is the first of all, there is a prospect and two, three years as you said for recovery, putting our finances into order and creating a much more viable economy. but secondly, that these changes will be just. and obviously we have taken some immediate measures him as an emergency measures, and they are not necessarily as just as we would like it because, for example, we are cutting down the deficit by cutting down wages.

and those who actually have their wages out in the open, and declare their wages are the ones that will have their wages cut. while those who taxi table not really feel this. so this is why we are moving into other types of changes which will bring transparency which would change the tax system which will redistribute in a more just a matter, the tax revenues, and the burden if you like, of the tax system. so that people in the and will feel that we not only have taken this very bitter medicine now, but we are actually creating a much more just and viable system. i would add the third element to this, that obviously with these measures we need to see the other side of the stabilization program in the european union. it's called officially the stabilization and growth plan.

and the other side of course is the growth area, we need investment that will be public investment, there will be you funds which we have, which we are allowed to have for public investment in infrastructure. but we also will be looking for private investment. i think this will be a time of opportunity for investors to come and see greece at@@@@# f@@u r

decades. in a way this is a challenge for europe. and also for the southeastern part of europe, where greece of course plays a particularly important role, that you played an important role. could you perhaps before we open it up to the wider discussion say a few more words about europe, the european project, which is in a way at the crossroads but maybe in a way this crisis can help you can also about southeastern europe, the whole enlargement issue, given the economic difficulties where do you see it going? >> well, if we go back to the origins of the european union as it is today, we're talking about a post-world war ii europe, where the major, the major factor in developing a european market at that point was common market, and in the european union, was pretty much a piece

project even though it began with the economy. as a matter of fact, the idea was to interlink the economies in such a way so that there would be no desire for war, as that would be catastrophic from both sides if you're all sides. so it has been a piece project, and people sometimes underestimate the importance of the fact that the european union, over the years, have brought in countries, for example, breaking the divide between the east and west of the cold war. and that is huge piece project. with it also is a democratic project to project a democracy. bring in countries that were formerly did dictatorships, greece, spain, portugal. but also many of the eastern and central european countries that were under communist regimes. and thirdly, it is of course an economic project with social cohesion.

the whole idea of social cohesion is very important. and many other countries, particularly the south, and we talk about the south sometimes we bring in countries like ireland, even though they are not south of europe. but now when we're talking about the central eastern europe, or european funding is help to equalize the differences, the economic differences in europe, i would say that today europe more and more will be evolving. this is a challenge and that is why this financial crisis can be an opportunity, not so much as an answer to the past of the world wars, although when we get to the balkans, i think and greece and turkey and so on, and cyprus, that's where we can see that the europe can play very important role in putting this conflicts to the past i helping the solution to many of these

protracted conflicts. but i feel that it's also looking to the future of how do we want to structure regions in the world in a globalizing economy? how do you get sovereign nations to pull their capabilities in a peaceful way so that we can deal with problems that go beyond such as the climate change or globalizing economy? we need to work together. we need to manage this planet. we need to have some form of governance of this planet. what kind of governance? well, i'm not saying that european governance is always as efficient and as quick in responding as one might want, but it is a new model of governance which i think we need to look and democratic governments, and how we deal with the world. just one more point on the balkans and turkey. the importance of the enlargement is, in fact, and

recall the word enlargement, it sounds very neutral, sort of a growth, growing geographically, but, in fact, enlargement is much more. it is sharing detailed values and institutionalizing these thugs within the countries that become members of the european union. so there is a process where countries apply for mentorship that it would be like, let's say, mexico or some other smaller, they want to apply to become a state in the united states. well, what would be the rules and the prerequisites for that kind of a change? well, this is what europe has been doing. i have been a proponent of moving ahead, both with the western balkans, countries like albania, former soviet, croatia, serbia, bosnia-herzegovina, so that we move and they are now most of them candidates are

potential candidates. they are -- i have proposed that we put a date to their accession which would be 2014, 2014, 2014 happens to be 100 years after the beginning of world war i, which began in the balkans in sarajevo. closing a circle of violence and instability, and again, showing how europe is a piece project. i also see that what turkey and i've been a proponent of turkey becoming, having the capability and becoming a member of the european union of course having to fulfill its copenhagen criteria as we call them, and a number of criteria which have to do with good neighbor in his. obviously, cyprus has relationship with greece. now that has been, i have been a proponent of this and this was a major change, as you remember, and policy 10 years ago increase when we said we had locked the

possibility of turkey being a candidate. and the we said we change that policy and said, make turkey a candidate and have full capability of becoming a member of the european union. saying that that in fact would be a stabilizing for our region. that would be important message for the world as a europe is bringing in a country which is predominantly muslim. and showing that the values we share have nothing to do with what religion we may believe in. and thirdly, in doing so we would solve problems such as the cyprus problem, but also issues that have to do with bilateral relationship in greece and turkey. so i am continued to be strong opponent of this proposal, and i do hope that a meeting with the prime minister of turkey we will be able to make more moves and

issues, that have be lead us and held us back over the many years, the last decade. >> make you very much, and i hope the crisis will end soon so that more of your time will become again available for these important regional and peace issues. i do remember your visit i think in israel and palestinian territories and how together as greed for mr. and a turkish foreign minister you gave the message to israelis and palestinians that one can work together and go forward together. so let me now open the floor to questions from the audience. please do identify yourself briefly so that we all know where the question is coming from, and please make sure to address the question to the prime minister.

[inaudible] >> thank you, prime minister, for that very eloquent rendition and also best of luck on the tremendous challenges that you face. i wanted to bring back a little bit to the economics. you mentioned the budget deficit. according to numbers where been looking at, greece has lost 30% competitiveness against germany in the last 10 years. costs have risen by 30% relative to those of germany. and by more than 50 or 60% relative to those of the united states, in terms of the fall of the dollar, et cetera.

now, my question is, how it do you gain that competitiveness in a situation where you have no control over your currently, you're part of a concurrency, no control over monetary policy. is a realistic that greeks will take 20, 30% wage cuts in order to establish competitiveness? or that they will increase their productivity? thank you. >> i think what i will do is take three questions in a group, and then let the prime minister answer because there will be overlapping parts of these questions. >> abdullah representing the policy orienting turkish organization here you can be see. mr. preminger, thank you for your remarks. your election as prime minister was as you know very well, was very well received and turkey.

and never -- there were high hopes your election would bring impact of the ongoing cyprus negotiations. and casual remarks such as you have to spend a great deal of your time and energy in tackling with his economic crisis, and i know how much you're willing to go back to your foreign policy issues, but my question is, what do you think about the cyprus issue? and where is this issue headed, as it is a major issue portioning turkey's relations with the e.u. as well. thank you. >> yes, in the back there. >> mr. prime minister, it is a pleasure to welcome you back to

washington. i want to ask you -- >> could you identify yourself. >> john. if i can ask you, mr. prime minister, much of the speculation about your policies over the last several weeks pertain to the amount that greece might be asking of the european union are whether or not an imf package might be put together. we are done of this in your remarks this morning, and none of this seems to have come of your visits to germany and to france. can you please specify for us what it is that your government is requesting, if anything, from either of these governments or international institutions? thank you. >> thank you very much. >> i will take one more. yes. >> executive director of the institute. welcome to washington, mr. prime minister. mr. prime minister, just want to pick up on your discussion had with kemal regarding that greece is looking more and more for

private direct investments. it's that point want to talk about or ask a question to get this was a will of american corporate executives rather than diplomats and reporters, what would you tell them right now in terms of trying to entice them to say why greece is still a good investment opportunity? if you could speak more specifics to greece's investment laws regarding in reforms that are taking place there in any incentives that would be forthcoming from the greek government regarding to entice foreign investment. >> mr. prime minister, i think we will turn to you to answer these for question. spectacular much that i will start with the economic questions. first of all, we said we're not asking for money. as with most countries are many countries, we go on to the international market to borrow for our needs. and what we are saying is that since we now are putting our finances into order, making our long-term economy viable and making the necessary changes, we

should be able to borrow at rates which are comparable, if not exactly the same, as other countries in the european union. as i said, if you had state, different states in the united states borrowing at different rates, that would make it very uncompetitive for different regions in different states in the united states. that's what's happening now. we go out to borrow and have double the rates of other countries. so what we are saying from our european counterparts is, we're not asking for money. we are asking for the types of instruments which are necessary that if we seek speculation, and if we see the markets not responding to what we have done, and would have done even if we were under the imf, that there be a contingency plan which make sure that we can borrow at normal rates. that's what we're asking for. we're not asking for free money.

we're not asking for bail outs. we are asking for the right to have similar rates of borrowing as other countries. that is what we need coordinate action, and that is where the european union now is moving in that direction in a positive way. and as i said, with both chancellor merkel and@@@@@@@ @ ,

when we go out to the market. but we've been borrowing at a higher rate. so again, that at some point we may have to, we may have had to go to the imf. since this seems to be a developing european contingent plan, and this is what i've been working on with my partners in the european union, i think that lowers the possibilities that even if there is a problem we would have to go to the imf. so again what we're talking about now is creating at this point an ad hoc estimate which will help the greek economy, if it needs when we want to borrow. and in the medium term look at the necessary institutional changes in the european union, such as for example, eurobonds or for example, a european monetary fund or european

guarantee which would mean, of course, possible changes in the treaty. but that would be and therefore it wouldn't be an immediate response. but that now would become very central in the discussion and europe. so i would like to see the european union now because of the great crisis and i am trying to spearhead this, that we went through is something which we can make an opportunity to strengthen our coordination and create the necessary institutions in the european union. what we can do right now is take an initiative on dealing with speculators, and that's why we're taking some joint political action from myself, angela merkel, nicolas sarkozy and others, and i will be able to give and it is also to president obama tomorrow because i believe this needs coordinated actions throughout the world. secondly, the issue of greek

competitiveness and what we would say, what i would say to you as business people, if they were here, first of all, greek competitiveness, yes there is a question of wages. but that's not the only factor core competitiveness. i know there's been a lot of emphasis on wages increase, but we have to also differentiate between public wages and private wages. there's a big difference there. and investors come in, and when they come and they want to look and see what private wages are and the private sector and not the public sector. sometimes the public sector will set the tone for the private sector. what happens with the public sector is the fact that we have a bloated public sector, and a much larger public sector than necessary. and somewhat chaotic salary scale where you have some very,

very high wages, which are exorbitant and the public sector and very, very low wages also in the public sector. so that's another area where we will spend money. now what we will be doing of course is creating other types of incentives which will also be much more helpful. first of all, the tax system will come in fact, create incentives for investment. secondly, it will create a much more lean and simple system for investment. for example, we estimated to invest in green energy as we call it, or renewable energy, increase simply by going by the book and estimate their would be some kind of a glitch on the way, might take five years just to get the investment ready to be, to be implemented, to be -- to be developed and start rolling the company in renewable

energy. we brought a law which we are cut that down to eight months. that you shows how we are cut down on bureaucracy. we are moving ahead now on making it much more simple to create a company and get through the red tape. so bureaucracy and red tape is one issue. the second is transferred to and corruption. i was another problem, sometimes often for investment. that's another area we are cutting into. and that is going to make much more lucrative. thirdly, we are also opening up professions so that there is greater competition. and there is which we are closed professions and that will be much more important i think both for investment but also bringing down the prices in certain areas. fourth, we are creating incentives for specific areas of greece, taking for example, the items which have great potential, actually greece has the biggest when potential per

capita in europe. but we have to do all of that. so we will make the possibility for investment in this area very simple. also like a one-stop shopping of investment. these types of areas, these types of changes we're making, i believe, going to create an are creating because we're doing this already, are creating the environment for a much more, much more effective system of economic development and investment. i would just add one more major point, which we're doing in our administration. we now have five levels of it administration from center to local. there are five levels. that's a huge bureaucracy. we now are, have proposed and in the next few weeks we will be putting it to parliament, a major revolution administration. we will be cutting it down to three levels. central regional and local. we will be cutting down the

number of cities from something like 3000, to 350, unified local government in many areas. and we're also cutting down about 6000 local government businesses that have been creating huge bureaucracies there. so there is a huge change is now been made in greece, which never would have been made before. i think the fact that we are in a crisis has also helped not only me but our government, and i would say a wider consensus in greece say yes, now is the time. we reached the bottom. now is the time for us to make these big changes. someone i think said here, someone, one of obama's aides i think is well known, will quoted to say you shouldn't miss a crisis, if such an opportunity to make changes, and that's what we're doing in greece. now, on cyprus, well, this has been around with us for many, many years.

i felt we came somewhat closer to a solution in 2004. as you know, the solution had to have a the green light from both the communities. and we have come back to this, and are re-examining this question. but it really needs strong political will. now, this is not something from the side of greece. we feel that we want to interfere in a direct way, because we see cyprus as a sovereign nation, even though it is divided because of the invasion in 1974. and we see that the community has all its rights to decide

what the solution will be. that's why what i can do is certainly support this process. and certainly in my relations with turkey, to create the necessary atmosphere, if turkey is also responding in a positive way, so that we help things happen on the ground. but in the turkish, on the turkish cypriots community, you have 3000 troops. you have much more direct involvement. i would say more of the turkish army maybe less, the turkish government, i would rather see the turkish government being more involved rather than the turkish army in the cypriots problem. and this is were i think you need a real political will from turkey to move ahead. now, prime minister tayyip erdogan did show this in 2004. i believe he can show his will again. but what we also need to take into account is we need to create a functioning cyprus, a

cypriots republic which is something we have to communities which will not be be doing one and another in every decision, which the type of governance is there which allows for a smooth functioning and a smooth function within the european union, don't forget cyprus is now a member of the european union, even though de facto the turkish because of the situation better, don't have their full participation. although cypriots citizens have all the rides as european citizens. but there are very big issues here that we need to make sure that as cyprus is a member of the european union, we must make sure that it is going to be able to fulfill all its obligations as a full and functioning and democratic country in the european union. so that's why we're talking about a federation by zone and

by communal. which can be, which can be functional and therefore, as it is functional it is also something which will be european. i would also add to this, finally, that the european is something we need to follow as cyprus is part of the european union. and the solution should be colored by the european, we should make that it is applied to cyprus and to the solution of cyprus. if these elements follow, i believe we can find a solution. and i do know that both the present and tayyip erdogan our old friends, and if they are really allowed to move ahead and particularly, i would hope that we find a solution. as soon as possible. >> thank you very much. and i think we will have to

close it now. the prime minister has as you might imagine an extremely heavy schedule. please, everybody be seated, because the delegation, the prime minister and his delegation will the first. so may i please ask you all to remain seated. thank you very much, mr. prime minister. [applause] [inaudible conversations] [inaudible conversations] chair of the nabe

economics roundtable. welcome, especially to new members and those who don't normally attend our policy conference. i'm sure you'd agree that already it's a terrific event. sincere thanks to the institute and the health policy forum. my superb employer for sponsoring. they strive to achieve its mission of systems research for better health by analyzing three strategic areas. culture of health, health equity and innovative models of care delivery. the health policy form is an excellent source of objective policy information@@@@@ @ @

flexibility always on display at nabe. we have pivoted to the productivity theme and the changes ongoing with hospitals regardless of major reform. these topics are critically important given the budgetary pressures almost exclusively due to growing health expenditures. a/k/a, the last presentation. and our two superb speakers here to discuss these issues. david cutler is the professor of applied economics department of economics in kennedy school of government at harvard

university. i know the name auto -- resonates for many in this room. professor cutler served on the council of economic advisers and kmashl economic advisory dur the clinton administration, advised bill bradley and senior health care adviser to the presidential campaign of barack obama. held positions with the national institutes of health and the national academy of sciences currently a research associate at the national bureau of economic research and a member of the institute of medicine. prolific writer is today's over used academic accolade, but in professor cutler's case, the environists a ban on printing his cd, by my likely out of date count shows 8 edited book, 187 books and chapters and acclaimed book "your money or your life." and finally i should note he is

a trailblazer on the construction of a health care satellite account to enhance gdp measurement. please welcome. >> thank you for the -- for the too kind introduction and the invitation to be here. i suppose being here reminds me of what my former dean once said. said about economists to the economics department. he said, it's well known if you took all the economists in the world and lined them up end to end, that would be a good thing. so i think it's a very good thing that i'm here. of course, everyone's wondering what is the latest from across the river? so i have here the latest for you.

this was elastic week's summit. i'm sure you've got quite a headache over health care. here, take two aspirin nap will be $1,200. as a result of variety cutting, we figured out how to reduce that. it will be $1100 for the two. in addition that, you want to know what are the odds that it will pass so just in case you are a betting fan, these are the official online odds that health reform will pass. so it starts from shortly after scott brown was elected senator that i can't remember and never have been to and the company i never have been to and the odds are about 50% and you can see they are spin a little bit of movement up overtime. it was trailing around 30 to 35% and the poor soul who bought at

30%. you need to know how to gauge these. i will show you how to gauge the odds. other odds you can bet, the u.s. and our israel is about 10%. cap and trade. any cap and trade fans? 21%. the ever popular sarah palin to be the republican presidential nominee is 23%. health care reform is twice as likely to happen as sarah palin is to be the republican presidential nominee. i suppose you may say why is all of this so hard? shouldn't it be fairly easy? what is reform about? the reason it's hard is we are trying to do a few different things. the first is we are trying to get everyone covered or most everyone covered so that is about 30 to 45 million people or so we would like to get covered. second and it's the that i and the other speaker will speak

about is the value of care and third is addressing the u.s. physical situation. of these, the sing e8 most important is improving the value of care. the reason for that is if we can't figure out how to do that, we can't afford to cover everybody and can't do anything about the federal deficit. one way or the other, health reform will blow up if we can't figure out how to do number two. put another way, if you can't make medical care system work better and save money, all the stuff about getting people covered is taking money from one person and giveing it to another person. that's a loser thing and always falls apart. you wouldn't have addressed the u.s. fiscal situation at all. the central challenge in reform is to figure out how to improve the value of care. i want to talk about that and i want to start off with an observation and that's that productivity increased everywhere except for health

care. these are the statistics and you can see enormous improvement overtime. very rapid productivity in the postwar period and the slow down as everyone knows in the 1970s to mid-1990s and a rapid increase after. it varies by industry and the most productive industries are information technology and agriculture is productive and retail trade that we used to think of as fairly similar that is one off purchases from small local providers with uncertain quality has had enormous improvement. it's not the case that it has been in goods producing introduces and not service producing industries although there is a bit of an industry. they had rapid growth and health care which is combined with education and social assistance actually shows in the official data negative productivity. that's not right because it doesn't predict quality.

still nobody thinks that health care belongs at the top of the slide, but below that. i want to think about two dimension although they turn out to be related. the first is service productivity, the experience of receiving care. the second is clinical quality. do people get quality and do so at minimal cost. what people want when they go to the doctor is they want to get better and want to enjoy the service or at least not hate the experience of having gotten better. someone once noted that only an economist thinks a colonoscopy is a benefit. people want to get better and they want to enjoy it. what do we know about each? the service quality is very, very poor. there lengthy wait times and most people would like to interact with their doctors. how many of you can e-mail your doctor?

how many cannot? name two other people in your life that you cannot e-mail. is your pet probably. more people e-mail their priests than their doctor. in fact as best i can tell, more people e-mail the lord than their doctor. a third of people say they lost test results and had to repeat it because it wasn't there and got different advice from different doctors and don't think the advice should vary. the common denominator behind this is that the medical system is not coordinated in any way. most people are essentially their own primary care doctor when they think about using the system. most people are pretty bad at it. that is even with a lot of training with a college degree and with some kind of ph.d. as i suspect most people have still don't know how to manage the medical care system and that is the task that we have with most

people and it's not surprising people are upset by the outcomes and the outcome are worse than we think. not to say people couldn't provide this coordination. you can think of any number of actors who ought to be able to provide coordination. the primary care doctor in principal is the who should be guiding you, but in practice they don't know when you have been in the hospital. seriously, they don't. most don't tell them. pharmaceutical companies could be doing coordination and they rarely do. they will have the information to do so, but they don't. google and microsoft would like to and i'm sure there will be an iphone application to help you coordinate. all of this is designed around the quality that is extreme le poor and an area in which if we actually made progress, we would see a huge increase in value. i want you to hold that in your mind for a second. related to that is the issue of

clinical quality and cost. i want to give you a premises. here's my premises. it is inefficiently provided. this lowers quality and drives up cost. how many of you agree with this? how many of you disagree? this underlies everything going on in health reform and the idea that we can. it's interesting when the president gives a town hall, the first question he is asked, if your daughter is sick wouldn't you want her to have the best care or if your wife were sick and why is it you think about rationing? what you agreed to is that well before we decide whether 88-year-olds should get chemotherapy with advanced cancer, we should think about all the ways in which we are wasting money and not improving health. let's put aside the issue of whether your mother or my mother or anyone else's mother deserves intensive treatment when they

get very sick and where is the money going that doesn't need to that is both higher cost than it has to be and lower quality than it need to be. the implication of this is that we should be able to improve quality and save money at the same time. how are we going to do that? let me give you a few examples. the first thing we could figure out how to do is reduce administrative personnel. the employment in the health care industry, the leading employment is not physicians. nor is it nurses. it is office support. remember the middle managers who were fired from american business? 10 or 20 years ago? i figured out what happened to all of them. every single one of them is working in health care. i know personally about duke university hospital where senator kennedy went when he had brain cancer. 900 hospital beds at duke university.

1300 billion get admitted to the hospital. what are they all doing? imagine the last time you went to the store. nine customers and 13 sales people. might be nice, but a little bit expensive. in addition that, all the other people are doing clerical things as well. the most common activity that a nurse in a hospital does? documenting things. one third of her time is spent do you meaning things. another 10% is spent running around the hospital finding supplies that are not where they are supposed to be or getting lab results or picking up medications or something like that. way too much administrative personnel because we haven't matched the people to what's need and do the supply chain. too much spending on acute care. when medicare beneficiaries go

to the hospital, 20% come back in within 30 days. in a fair number of those cases, the person never saw a doctor or nurse between discharges and we know from the best systems that you can get that 20% down to 6%. how do you do it? have the nurse talk to the doctor. what the nurse does is explain when the doctor said you should take this medication every day, what the doctor meant was take this medication every day. that will help to keep you out of the hospital and the recommendation was go-go to the doctor and talk about the condition. go to the doctor and talk with the doctor about your condition. what's interesting is we leave that in the hands of the patient to do. there is no system activity associated with doing that. that sort of reinforces the issue of the system i want to keep coming back to. the third area is medical error. it's estimated that that is the 5

fifth or 6th cause of death. we decided we ought not to pay for medical errors because most of the rest of the world gave i in addition not knowing who you are supposed to see when you

have a condition how good they are and the various treatment options other than the last four patients i saw did better than on this and this. the first is information and the second is appropriate compensation arrangements. no industry does well by paying people to do stuff independent of whether it's really needed or not. health cares to doctors and hospitals and the way you make money is by doing more stuff. don't think about ways to reduce demand. the easiest way to go bankrupt is to make sure your patients are healthy. seems like a bizarre way to do things. empower the workers and consumers to help you out within hospitals since we have been picking on hospitals, i will pick on them more. the nurses who are spending 10% of time looking for things that are not where they are supposed to be, when asked do you think you could organize the system better, they say absolutely yes. how come you haven't done that?

no one has ever asked me. we throw away billions of dollars that way. a year ago in the federal stimulus there was $30 billion to wire the medical system. every medical practice will be wired, but that won't solve the information issue. 10% is having computers and 90% is what you do with the information. that will at least lay the foundation and part one was to do that. part two of the strategy is to degree compensation and in the 2700 pages of health care bills that the republicans want to everybody about, the most common activity happening is changing compensation arrangements. almost exactly what that is about. a little bit of pages and a fair amount of money associated with covering people and with dealing with other consumer issues. basically part of a well thought out two-step process to get the information technology and the arrangements to work to improve

the system and increase the value. we will need an enormous amount. one of the huge industries that will have to be created by health care reform or by the system in absence of reform will be the industry for collecting, analyzing, retrieving, making in realtime and the right data available. health care is and ought to be a wash in information. the issue is not to produce the information. it will drown people in the information. the issue is to use it right. there will be a huge industry associated with it and just as there is productivity enhancing with everything which is about using information well. if you ask what the most productive firms do, many of them are using information well. that's the first part. the second part that is more fundamental is changing compensation arrangements. we pay for medical care based on where the care takes place. does it take place in the hospital and does it take place

in the physician's office and does it take place in the pharmacy and a lab and does it take place in a nursing home or the patient's home through a home health base? there is nobody that i know of who cares where they get their care. they care only did they get better. the fundamental conception did it get better and when it gets better, what you need to do is orient the information and the compensation around the patient. not around the patient provider interaction. i have drawn a box around all of these. if you think about most of what happened in retail america, the reason why retail america is so productive is it drew a box around the inputs and said we are going to bring you the inputs in the way that is best and most efficient for you. nobody in health care has done that. whoever does will combine them in the most productive and most

profitable industries in every sector and as a result they will get all of the benefits and all of the bonuses that come along with that. how are we going to do that? i don't mean we in the sense of reform, but what will happen in the medical system. there will start to be payments on performance and think about whether the doctor or the hospital is doing a better job and not just doing a job. paying for care coordination and the transitions and coordination aspects that are underdone and bundled payments that is don't give a separate payment for each admission each when wasn't necessary, but one thingle payment for everything that come along so they have incentive to figure out the best ways to do it and improve the experience of the patient and also improve the value of care. and lower the cost of care. fundamentally what's going to

have to happen and what i believe will happen easier with reform and will happen in either case, we will have a revolution associated with the figuring out what do people need and how to get it to them when they need it and not what do they not need. to me that will be the essential thing. i will note on the organization aspect of this, in every industry where the transformation has taken place and in every one, use of it and productivity improvements have associated with firms getting bigger. i will not at all be surprised to see health care firms get bigger as opposed to smaller. you are already seeing this and see this in the hospital industry in the typical american city. one quarter of the hospital admeigs are accounted for by the biggest health care system, one third of all profits. bigger is grar at the ability to econ myself and take advantage of economies of scale and bigger

is more bargaining leverage and going to be a lot of things. it will surely be -- it will surely be the outcome in health care. a number of friends will be very, very happy to see the single or small group doctor disappear over the next decade. completely disappear. about three quarters of all patient interactions are in small provider groups now. people would love to see that disappear. i want to give you an analogy for what success would mean. how much could you save? most guesses are that you can save at least 25% in the hospital industry. not by cutting product lines, but by doing stuff more efficiently. about 10% of total spending. that's more than the president promised people. unitedhealth group thinks we can save $300 million through

administrative interchange between providers and insurance. the potential is enormous and we waste about a third every year or about $700 billion a year. what the president promised people is not a third, bi8%. i think he was way understating what is possible and what we know we have to achieve. i want to give the example of other industries. i have a quiz question for you. what do these people have in common? who will venture a guess? what do they have in common. a few are related. three strikers and out. a few of them are related.

these are all the health care people in the forbes 400. here's how they earn their money. what do you notice about how they earn their money? with only one exception, with only one exception, every one of the people earn their money by something you stick in a body. he made money by organizing hospitals. i want to show you a different. every is stuff you use. these are the retailers on the forbes 400 list. six wal-marts, five home improvements including three home depots and best buy and super markets. some of them you have to be in the midwest to use.

what do you notice about the folks? not a single one made a thing that you stick in you or physically consume. they made their money by changing the organization of how you buy things. the health care and the rest of the economy and the health care that has been no organizational innovation associated with figuring out how to bring you a better product cheaper despite the fact that every other industry has created billionaires that way. whoever figures out how to do that in health care will be the next billionaire. how to coordinate care and stream line practices and overhaul the procedures and ensure proper care and manage the information structure. we do that because they will

drive costs out of the value and the supply chain and figure out how to improve value. that will be the single biggest thing to happen to health care ever. that's what will allow us to cover everybody and put a dent in the deficit and bring health care from something people dread into something people feel better about. that is my own personal forecast about what we can do and that's my sense about what's at stake associated with both passing reform and also making whatever passes or doesn't pass actually work to the benefit. thank you very much. the development at american hospital association. she plays a central in developing the association's advocacy agenda in educating policy makers and hospitals about the implication of

legislation and regulations have on hospitals and the patients they serve. before joining ha she served as the director of the office of ledge slagsz for medicare and medicaid services and represented the policy physicians to congress and also served in staff leadership positions for the senate finance and the house ways and means and is an adviser to the cms administrator. she was a key contributor to three pieces of medicare legislation in 2003 where she was held to charles grassley. the act of 1999 and the medicare and medicaid benefits in the protection act of 2000 when she served as professional staff to then chairman bill thomas and also want to point out with the

association of the american medical college that we are fond of. please welcome her. >> thank you. >> thanks very much for inviting me today. i have to agree with what david said. a lot of random thoughts came into my head as you were speaking. if i run through the slides, we can have a discussion about that. i'm sure you have a lot of questions to ask of us. i would say that there could be a productivity revolution in health care if in fact we changed the delivery system like david suggested and we created

environments in which the changes can take place. my association that represents all the hospitals and represent on over 5,000 of the hospitals ranging from the teaching hospitals and v.a. hospitals and belong to v.h.a. we have been working for several works about a framework that would not necessarily be a hospital framework for change, but for everyone for the health care system to change. we call that at the a.j. health for life. this is a scheme attic for what we call the five pillars or central elements of health reform. in the efficient affordable care, we already had a number of task forces since david suggested in administrative

simplification an area in which there can be savings. and we think more than 300 million.@@@@@@@ @ having a task force on spending which did not come up. if we get them into a political discussion after my presentation, we can certainly talk about that.

finally we had a task force on payment reform. they have made the series of recommendations that i am going to present today that gets us to where david is going. it can result on an increase in health care. we have to align across providers so that care can be accord and we call this integration. we have been on capitol hill talking about the need to make changes that would help coming to and clinically integrate to deliver more efficient higher quality care and lower cost. we had a little bit of difficulty on capitol hill because frankly some of the members of congress as well as staff don't quite understand the

kinds of things we need to change in the legal system to facilitate care coordination and here i show you what we call the big five. changes that we need in antitrust law and the law that deals with patient referral and a physician referring to a particular hospital that he owns or not or has a relationship with. anti-kick back law and civil monetary penalties that can be applied if you tried to deliver less care than what a patient feels he or she needs. those kinds of issues. irs tax exempt law that has to did with that. we have written an integration trend watch and i have a few copies on the table and i will show you a web address where you can get them. we have this trend watch monograph, if you will, places

that have gone ahead and started to clinically ind grit on their own to provide better care. a as david said earlier, many of these tend to be in systems. that seems to be able to do a better job of getting at these things than the stand alone hospital that among our membership there is significant worry among the stand alone independent hospitals about whether or not or how they are going to survive in a health reform environment that demands more accountable care and more integrated care and more financial risk. that was the topic of the retreat at the end of january and we from have to agree that this is how hospitals will be asked to behave. we need more regulatory reforms and this is sticky about all the

rules and govern. skilled nursing and hospitals and how we all relate to each other. one of the questions we have is if we move to a bundled payment system, is medicare going to get out of the way and let us manage the care with respect to perhaps not abiding by these kinds of rules and regulations that exist. interestingly in the legislation before the congress that i would give higher odds than 50-50 that it's going to pass. there demonstration projects and bundled payments and other things i will show you. the secretary has the ability in these particular demonstrations to waive regulations as necessary to be able to conduct the demonstrations and we presume what they are talking

about are these particular impediments to the integration. we are not sure how that will be perceived should this legislation pass. these were the findings that came out on payment reform. virtually all the participants on the task force and there were about 25 ceos representing the broad spectrum of hospitals as i said, hospitals are very diverse. the communities they serve are diverse as well. in addition rural pop eulogies that are far scattered in frontier areas. everyone pretty much agrees that fee for service is on its last legs. also that incentives for payment methods and that they have to change in ways that we can align

the incentives and provide a significant time frame for transition so that payment reform can lead to the means to the end of delivery system reform. payment systems create incentives. that was pretty obvious. in 1983 when diagnosis-related groups were implemented and reports were told and it was questionable how they would respond and they did to the incentive to receiving a bundle for a group of services. they reduced length of stay and turned it out to make a large profit in the early years. i want to say they respond to incentives and it's important to get those right. at the retreat as i said, we talked about accountable care and readmissions. i will talk a little bit about it. this came up in the retreat.

the hospital leaders tried to improve care and the profit margins go down. the whole system is built on getting more and more admissions. we have to flip that on its head and change that kind of incentive so that people can try to deliver the right kinds of care. another set of findings is that we are going to focus on medicare first. even though medicare is far behind the private sector in payment in a patient, it is our largest payer. it's easier for the national association to focus on medicare first. increasing the size of the unit of service, as i said they are kind of a small inpatient hospital bundle. we would like to see bundling of payments that might go across physician hospital payments or physician hospital and post acute setting payments. align the units of service across providers.

that's easier said than done given the mish mash of payment systems we have and i'm not sure if you asked me how to do that, i may not be able to tell you that we can could that quickly, but we need to do that. political integration, i talked about stripping the providers of the ability to make these up front investments. several said a lot of these kinds of things like seth up accountable care organizations, for example, which is say highly sophisticated reform will take a lot of money. if you are going to cut the payments in the early years, we won't be able to generate the capital we need to make the changes. of course we need to accommodate the different types of hospitals and different paths and i will talk about that in a minute and holding us accountable for quality efficiency. these are the proposed reform policies that are in the

legislation that is before the congress. as i said, i think there is a good chance it will become law. david talked a little bit about value-based purchase ing and paying for hospitals based on quality. we report quality information to get what we call a full market basket and inflation update. this is a more elaborate system, if you will. currently it's considered to be budget-neutral. it moves money around among hospitals and doesn't save money for the program. bundled payments are demonstrations and pilots in the legislation. we have a number of people, a number of members who are interested in going forward. many of them are already the bigger systems. they are already doing this in the private pay areas with places like wal-mart, i believe.

in minneapolis where he was doing that. several people are doing that and accountable care organizations, there a number of pilot programs currently in play where we have several members who are interested in becoming accountable care organizations right away once the legislation is passed. infections, there is a policy not to pay hospitals for hospital acquired infections and obviously we support that. i think that's pretty hard to argue against. the way the policy works in the legislation is not something we agree how it's done, but we agree with the principal. readmissions, david talked about readmissions and that saves about $9 billion over 10 years the way it's currently written. we have done a great deal of

work on this issue. i would submit to you though that not all the admissions are the same. what we are trying to tease out is policy and to separate those that are unplanned, but related to the initial admission. those are the ones we should be held responsible for. however there readmissions for which the hospital is not responsible. for example, my mom gets a hip replacement. she is discharged from the hospital. on the way home to her house, she is in a car accident and has to be readmitted to the hospital. that is a readmission for which the hospital does not feel it should be responsible. we have to tease out those kinds of exceptions to the policy. we also feel that all other providers at the same time should be held responsible.

figures, nursing homes and so on and how that gets applied is important. i was at a meeting and they were talking about how they reduced their rate considerably simply by insisting the primary care physician called the patient within 24 hours of discharge from the hospital and they can see the dramatic drop in the numberreadmissions they had in the hospital. the issue is trying to get the system set up and communicated and shared among all the hospitals. these can make impacts on the kind of care delivered. this is a little bit hard to see, but it's out of the trend watch that shows you some of the examples of our systems that are doing things ranging from

bundled payments for a single episode of care ranging to the more integrated members at the right hand side of the slide where the medical staff includes only mostly fully employed physicians. as david said, many of his friends said the monday and tuesday practices should go away. several people in my organization that feel the same way. effectually perhaps all physicians should be employed. that's not an organization policy, but there is definitely that feeling that physicians would be better off to prepare the deliver fe physicians were employed or in a large specialty group. this is our scheme attic from our payment reform task force. i'm not going to go over it, but it shows that payment reform, we see it as an evolutionary path.

you will notice that in stage one, it's about aligning hospital infacient patient payments. it is test and we gather data and we eliminate the barriers to clinical ipt grigz that i talked about. it proceeds to stage three. accountable organizations. that's not for everyone. some of our members would like to go to stage three and they are ready to do it. those in large systems. we created also the alternates. the one i showed you is for low volume rural hospitals. those with less than 2,000 discharges per year. an interesting statistic is with the medicare program. for those of you who follow this, there many classifications are rural hospitals.

critical access, sole community, medicare dependent hospitals. all of them are small and @ metimes relatively low volumed hospitals. pay paid 100% by medicare program.

what we proposed is paying 100% of the kofs and extending that to other types of hospitals and we decrease friday 101 to 100% and proposing the 2% bonus and certain types of quality measures and so on and getting rid of the sdirchgs to make it more efficient. that has actually been met with favorable feeling or thought from some of our members. we are trying to get nads get us to a rational kind of organization. i want to finish up. i have given you our website where you can pull off the integration watch and i think it's really something on the information. with that i will stop and maybe we have time for questions. thank you.

>>are we have time for questions. yes. this is where i get to be mildly insulting and say make sure to be clear and try to be brief and remember a question ends with a question mark. the different incentives with an hmo provider and publicly traded hospital with activist investors and go in both companies and say this is how we want to work together. contact me and i can help you. a lot of the hospitals are not

for profit. there is a related version which is if you ask why they don't push for these things, they say i'm small in the market between medicare and medicaid and others are small and i can't do it. if you ask the hospitals, we need up front money to undertake the investments. if you agree to do investments, you can get savings and there may be less of a strategy and more on the close crabration. >> what are the concepts of the organizations and how do you handle the risk? right now the way it is, if a hospital wants to assume that risk, it has to start through an hmo. some of the hospitals have that. the accountable care

organization model allows potentially for assumption of partial or shared risk. in a way that might make it more attractive for hospitals or large multispecialty physician groups to start those kinds of models. i think that's what the intention is of those who want to drive it. >> the analogy with the retail is apt. they have chains of dialysis that are defeated by the lack of price due to the price fixing in the payment system and from medicare. the question is, the president proposes cash subsidies for younger people while retaining

this incredibly complex payment system we just outlined for older people. why not convert the system to cash subsidies and let the price mechanism work as it did in the retail sector? >> i'm pleased to hear the analogy. who the president proposed is what is over the next decade and transformation of the program. because it's popular, he wants to go in steps rather than to do it all at once. i keep a list in my mind of the elements of reform no one has heard of. let me give you one example to show you. it proposes $10 billion for medicare to experiment with ways

to have coordinated care that would prove the value of the cost and quality of anyone successful. it's a way of stream lineing it and saying look, whoever finds a way to make this work and will be happy it go along with it. nobody -- you don't see those and people are missing what is there to do the biggest transformation of the program ever. >> i would like to build on that. we are very excited about the centers for medicare innovation and we are supportive of that, however how the medicare office runs the effects. frankly, i was there and i think those people are great and they do a wonderful job and work

hard. they will often saddle these experiments with a poison pill or some kind of mechanism that makes it not work or it takes years to evaluate the yoit come and years to design the project. this is a way for them to get things out there kwikly. we are nervous about it.

to give me the med. we are not allowed to do if. my understanding is this is the state pharmacy groups who have basically restricted the ability of doctors and hospitals to give medications to patients on the way out. that means they then have to go and get it on a separate trip that increases the likelihood they won't get the meds. how do you propose dealing with that professional licensing protection that seems to be pervasive in health care? >> i think it's going to be difficult and you hit on an example of the kinds of things that need to be done and that are in the care coordination. everyone to some extent including my association of hospitals has skin in the game and they don't want to give it up. somehow we need to get over

that. to get to the place where care can be deliver in a better way. i don't know. >> in the short run, they have been describing them as helpful. i think we are going to need a third part of health reform. the part one was it and payment systems. part three will have to deal with a variety of the legal issues where we slept on all these regulations to cover up the incentives of the system that were going the wrong way. when you get them right, you can care them down like the wallpaper when you fixed the crack in the wall. the start rules and the prohibitions on the practitioners and the pharmacy things. >> the corporate practice. >> all of those things. >> the medical education.

>> fidelity investments, when i purchase a car, i go on the internet and i look and i look at consumer reports and find out how good the various cars are. i go on kelly blue book and find out how much the cars have been selling for and how much i can trade in my own car, etc. for anybody else in the country, they have to make a massive life decision. they have no information. if medicare is the biggest consumer of medical services in the united states, why can't medicare commoditize information from the health care system? >> it's interesting because during the entire bush administration, they said let's let the providers deal with the information stuff and we will pay them what they pay and they should have inceptives to do

that. the obama administration said enough of that. we are going to pay for it. we are going to cut the information and make sure it's directed the right way. we embarked on a crash course to do that. it would have been better had we in the 2000 or 1990s or 80s like everywhere else in the economy decided to do that. there is no excuse for it not having been done. >> i was going to ask the question, have you been on hospital compare? there is a fair amount of information on the internet and for several different kind of procedures, i don't know if they are replacements, but you can go to hospital compare and look at the relative quality and information of the hospitals in your area by zip code. it's questionable how many seniors actually do that. in thinking about how you make

these decisions, you tend to ask your relative or a family member or friend where did you get your hip replacement? i don't know that consumers do that as much as people think. for example, in california they publish charges. i think there is a law that hospitals have to publish every charge that they have in their institution, but there is a question as to how meaningful this is to consumers. the area of research needs to be what kinds of things can be put on the internet that help make these decisions? i'm not sure we have it right yet. >> pennsylvania too. >> rick o sullivan changed management solutions and helped at round table. my question is about the environment in which patients function and there is no mention

of that when when we talk about quo holding physicians and environments accountable. when you look at childhood asthma, it is 10 times more prevalent in low income areas mostly because of the dust created and i have yet to see the policy that lists the owin man as a preferred provider. when you talk about holding them accountable and looking at the environment accident, are there sidewalks and places that support a healthy environment that is outside the health care facility's control and specifically we talk about improvements in productivity, i was excited. a decade ago with assisted living facilities because it shifted the dynamic instead of having providers all in one spot in the hospital, you now had the biggest consumers all in one

spot in the assisted living facilities and the hospitals have not shifted care out to take advantage of this. how you make those things happen. >> i have actually -- i think there is a good point. i think about it this way. in a lot of cities in the u.s., there isn't an organization that has more money than the public health department. that is the big hospital system. they are also caring for a lot of those folks. i wouldn't be surprised or hopeful if we involved in the next few years something to where the states through medicaid or the cities go to the providers and said look, we will free you up, but you effectively will be the public health department in those areas and figure out how to work with people and improve their health

and guarantee it's worth your while. you can do that because the amount of money you save us onå takes responsibility for the health of a population. and you could envision, for example, one hospital in new york, i know of has gone into homes and removed lead-based paints where pediatric patients live. those are the kinds of things you're talking about and they do take on a -- they don't. they just do it. it is a part of their public service, you know to, get tax exempt status, you have to provide community benefits. st o provide a community benefit. that can count as a community

benefit. >> professor cutler, i suppose that they were to show up to create a large firm like wal-mart and a network of hospitals and pharmacies that provided exactly the kind of revolution that you are talking about and made $50 billion off of the process like the original. i worry that in congress, not just this congress instead of being hailed as innovator, you be condemned as a profit ieo there seems to be the existence of using a profit motive to drive innovation and revolution in medical care unlike other industries. what can we as economists do to address that demonization and prejudice in the public sphere that said all the motive is

illegitimate? >> i guess i -- there certain ones that way and i am struck by the number of democrats than to the republicans. i am struck by the number of democrats who say look, we have to innovate our way out of this. this is not going to get us anywhere. let's innovate our way ought of this crisis. when i looked at the bills being put forward, far more than regulation, there was a bit more here and there and totally understandable and some of it is icky and who cares, but basically it's about incentives to drive change and people understand that will create a lot of winners and people are comfortable with that. that's just not to say that nobody would complain, but people understand what they are getting themselves into.

>> real quick, the last word. >> both of you focused quite a bit on the quality of care and i'm somewhat confused about how you define that and how do you measure that and particularly with regard to geographical area and differences in population and how efficient that could be once you have framework that you can work with. >> right now medicare drives the quality measurement process by holding hospitals accountable for certain quality measures. those measures usually have gone through a process that includes the initial quality forum. we have a stakeholder group entities that assemble periodically and work on quality measures and submit them through the process. we have an organization called the hospital quality alliance

that endorses them and we find the way into the medicare payment system, if you will. we have to report on the measures in order to get our inflation update. we see those quality see those measures expanding over time and certainly in the health information technology roules that came out, of which comments will be finalized in the coming months, there is a whole elaborate mechanism for quality information to be reported through health i.t. that we see as kind of the wave of the future. and one of the questions we have is how many quality measures are too many quality measures. and you talk about the 1300 people at duke who work on admin symp. eventually you have to abstract all that quality information from patient records and that kind of thing and how -- is that going to lead into another bunch

of people working in hospitals doing nonpatient care kinds of things. >> i'll leave you with one example of where i think the road will be very difficult. in the course of this bill, there was a kind discussion between the business round table and the ama over whether medicare data, the data that medicare keeps on claims records, should be made available so that big corporations can use it, combine it with their own data and figure out who is providing good quality care and who is providing bad quality care. and the business round table was insisting on access to the data and the ama was insisting that the data longed to the doctor and, lfr, they couldn't be given out without permission of the doctor. and one way or the other we'll have to decide issues like that. which is sort of -- comes dreblg directly to your point, which is over the next decade, with or without reform, we'll have to decide whether we want to take

steps to improve the value of care or we don't. and if we're going to fight it every step of the way, then it will be a god awful decade. and if we don't, then it will be a wonderful decade. and i actually want -- i think if you listen to what lip today is say, it's exactly right because it's helpful because what she's saying is, look, all of my members, even the ones who are most vulnerable, know that the world has to change and we're going to do it, we just need to make sure that we do it in a way that makes sense. that's where most of the providers are now, which is what makes me hopeful that we will get there. they're not saying, no, this is too fast, we have to slow it down. they're saying we know this is coming, we've got to do it. >> i just want to make a last plug. our association has a separate initiative that's run out of a whole other branch of the aha called hospitals in pursuit of excellence. and it is part of our extra

teenlgic plan to reduce things like blood line infections and utis, urinary tract infections, and readmissions. we actually have that written into our strategic plan as a peeled with percentage goals to meet over the coming years. so i would tell you that -- and this is totally a vol unarea thin voluntary thing. the government has nothing to do with this. we're educating members on how they can achieve those goals. we feel at the end of the day this is coming at us and we should take the initiative and be aggressive with solving the problem. >> just so that you know, slides are put on the website very shortly after the meeting so you don't have to ask to get the slides. join me in thanking our excellent speakers.

[captions copyright national cable satellite corp. 2010] [captioning performed by national captioning institute] >> today on c-span, a look at the obama administration's enforcement of immigration laws and president obama in pennsylvania talking about health care followed by today's "washington journal" and live coverage of the f.d.a. commissioner testifying on her agency's budget. >> over 1,000 middle and high school students entered this year's c-span student cam documentary competition with a short video on one of our

country's greatest strengths or challenges this country is facing. we'll announce the winners. >> up next, enforcement in immigration law. the group hosted this hour-long sflept washington. >> today i join my colleagues from immigrant and civil rights organizations from across the country to denounce cruel and inhumane immigration enforcement practices that are tearing our communities and country apart. these are the same enforcement practices that we marched against during the bush administration. these are the same enforcement practices that we with now are forced to denounce and march

against under the obama administration. many of us celebrated the historic election of barack obama and believed that his election would bring justice to immigrants and their families. we believe the then candidate for president barack obama when he promised to fix our broken immigration system. he said he would do this within their first year in office. he said he would stop the raids and enforcement practice that defuated from our american values of justice and equalitity. yet, in the first year of the obama administration, immigrations has deported 387,000 people. you can see the increase this n this chart. -- in this chart. this is a record high number of deportation and an increase of close to 50% from fiscal year

2008. this is an average of 1,000 deportations per day. every day, detention and removal operations hold an average of 32,000 people in detention centers across this country. immigration audits of employers have tripled resulting in whole industries and of their immigrant and native-born labor force. finally, this administration has continued agreement with local law enforcement agencies that are clearly violated the civil and human rights of entire communities. millions of citizens and new americans voted for change, and what they got as far as immigration issues are concerned, are just more -- much more of the same. we have waited for over a year without legislative progress on comprehensive immigration reform. without reform, there's still no relief for millions of families across the country. so, mr. president and the congress,ing we are bringing our commands to your backyard on

march 21 in our march for america, change takes courage mobilization. our expectation that by march 21st, president obama, you exercise your leadership by helping move forward a blueprint for bipartisan immigration reform bill in a real time line for getting a markup in the senate judiciary committee. in the mean time, we command an immediate stop to all deportation, because each one of these deportations, each one of these numbers equals a life destroyed and a family devastate ed. [speaking in native tongue] [speaking in native tongue]

[speaking in native tongue] [speaking in native tongue] [speaking in native tongue]

[speaking in native tongue] [speaking in native tongue] >> now to tell us her story, to tell us how immigration enforcement has impacted her family, i my smother my rock. someone that motivates me and

pushes me to accomplish my dreams. she came to the u.s. for a better future. one day people came pounding on my door looking for my mother. i felt scared. at the moment she was not home. they tried to interrogate me and my step dad, who was present. they gave up and left. they arrived at 6:00 a.m. and left at 6:40 a.m. i had to get ready to go to school. on my way to school i was wondering if i was ever going to see my mother again. during my first period class, during my first period class, that same day, i broke down in

tears. the next day when i was returning from school, i had noticed that i was being followed. i noticed in the corner of my block there was a black van with one of the ice officers that had come the previous day and on the other side came a red range rover passing very slowly. they had noticed that someone opened the house door. as i walked in i told my step dad that i was being followed. they took him to downtown detention center and asked him more questions. they had detainment the whole day. i was alone being taken care of my friends and families. i couldn't be in an environment

where i was being followed. i couldn't be without my mother. children my age shouldn't be living a life like did. i couldn't do stuff, go out with my friends without being followed. kids my age are planning for their future. put yourself in the situation that i had to go through. it is not easy. in november 2008, when this situation happened, barack obama became president. my family had hope that he was going to stop family separation, that he was going to do something. show us that you are against family separation and that you are a true president. a president that keeps his word. you are our hope. hope that you are going to make a change. thank you.

[applause] a change. thank you. [applause] >> thank you beatrice. this is happening despite our many contributions of the immigrant. our next speaker is artemio arreola. >> thank you. immigrant workers have been the backbone of americas. immigrants have always done the hard work that was asked of them, and we always will. today we are hear to say we are tired of a broken immigration systems that forces workers to live in the shadows because our elected leaders don't have the courage to fix the system excite

the hate and fear amongers. we are tired of the bureaucracy thateeies art for decades and we are tired of being made promises to and tolding our crying children like beatrice as they watch their parents being taken away and deported. we know immigrants and other people of color are the first people often to lose their jobs. we also know that immigration reform will be an economic boost to this country. the center for american progress has reported that passing an immigration reform bill would actually put $1.5 trillion into our economy over the next decade. the cato institute has said immigrants increased the economy and raised the standard of living of american citizens. just last week, ben bernanke, chairman of the federal reserve board, listed immigration reform as one the issues that congress

must take up to improve the nation's lagging economy. so today as our economy struggles out of a recession. we know we have an economic recovery package right here in immigration reform. and yet we are spending billions and billions on enforcement that adds insult to injury by deporting the very workers that hold up this economy. this administration seems proud to out enforce the bush administration, deporting on average as angelica, 1,000 im -- immigrants a day. 1,000 immigrants who make life better not only for themselves and their families, but all of us who live in america. we've watched the paper raid tear apart the communities. in my home state on christmas

eve 2009, approximately 1/4 of the town of brewster was laid off of one the largest orchards. the town is still feeling the effects and the fruit is still rotting in the field. this is not sound economic or moral policy. this is not leadership, and that is not change we can believe in. we expect more, we expect the president to order his administration to stop the deportations and to demonstrate leadership on passing immigration reform and issue that has been shown time and time again to be a bipartisan issue that's essential for our future and for america. immigrant voters across the country had the audacity to hope when candidate obama became president obama. it's time to deliver. our patient have run out.

thank you. [applause] >> our next speaker is brent wilkes, the leader of the oldest and largest hispanic organization in the united states. >> thank you. in july of 2008 candidate barack obama attended the national convention and addressed 4,000 delegates. he told us that immigrants who were working hard and contributing to this economy deserved a break. she -- he said if he was elected president, he would pass immigration reform in the first year of his presidency. now last forward 21 months. many of the delegate that is were there believed him. they thought if candidate obama became president we would have immigration reform. one thing they never believed, is that president obama would have a record like this, where he surpassed in the bush administration in deportations.

it is unconscionable to have over 87,000 people deported in the first year of obama presidency. and our community is angry. our members feel betrayed. it's not just the deportations, in addition to the deportations, the raids that president obama said he would stop have continued. over 2,000 immigrants have been detained in raids of the first year of the administration. and just two weeks ago, homeland security did a three-day sweep in texas arresting over 284 immigrants, 119 from dallas/fort worth, 80 in san antonio. this is part of new stepped up wave of arrest that the administration plans. this is happening at the same time that the u.s. census bureau is sending out census forms across the united states. unlike previous administration both in 1990 and 2000 which

backed off on immigration enforcement, this administration appears to be doubling down at a time when the community could be scared away from filling out the census. that is a big shame. because we've seen that immigration enforcement during the census time frame can contribute to huge undercounts in the latino community. with the undercounts, it comes the lack of resources in the hispanic communities across the country. we are very concerned. as beatrice's story told us, the enforcement is far too often overlooked, especially considering the children that bare the brunt of the policy. there are 5.5 million children living in the u.s. with at least one unauthorized parent. at least 3/4 of them are u.s.-born citizenned. the department of homeland security estimates that the last 10 years, more than 100,000 of immigrant parents have been

deported from the united states. can you imagine over 100,000 stories just like beatrice's happening in the country? it is a shame. we're also hurting ourself. you know, the cost of mass deportation to our economy is staggering. the center for american progress, same study that was quoted earlier, also estimates that the mass deportation would reduce u.s. gross domestic product by $2.6 trillion, that's not including the cost of deportation. the economic impact would lead to widespread job losses throughout the united states. not only that, there's a lot of evidence that the stepped up enforcement of the bush years and into the obama years actually helped trigger the housing bust that now has lead to the economic recession, one the worst that we've seen since the great depression. we're hurting ourself by being immoral and attacking hard-working immigrants in the united states. we have a simple message.

stop the deportation, pass comprehensive immigration reform. president obama, you promised our members, you promised our community, please deliver. thank you. [applause] >> >> so in our search from leadership from washington, d.c., we find ourself not finding it. we go back to our communities and seek out the leadership there. to speak about some of the action that is are taking place around the country. i want to now introduce artemio arreola, who represents the immigration reform. >> i live in chicago for the last 20 years. 2008 was my first election that i participate. in november, the same as 10,000 million latinos were at the polls. we are excited about charismatic

candidate, barack obama. where he told us in america no mother can be separated from a child. what happened later? we are thinking is it stop deportations, we hope we make it. look at what's happening. around 1,000 people, -- 1,000 faces deported every day. the latinos are frustrated. we demand solutions, and we told the president he is not alone. we can count with us. legalization is a solution. we want it now. we want to tell also, those voters, we will keep voting in the single election. but more important, we have memory. we will remember. [speaking in native tongue]

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[speaking in native tongue] [speaking in native @@ @ @ @ @ @ @ @ @ @ xñ@ @ @ @ @ @ [speaking spanish] [applause] >> our next speaker. >> hi. today we are here for one reason. on march 21, thousands of thousands of immigrants who were born in different countries, who speak different languages, who have different cultures, will be marching for one reason. the reason is very simple.

we care about this country. we care about america. we care about this country. we care about america. together we want to live in america where young people, talented, smart young people have a full access to higher education. so they can be a teacher, social worker, so they can contribute for our community. together we want to live in america. they are high walking people have a respect. and family members stay together. so they can be so productive for the work that's employment and school for this country. but sadly there is not happening in america anymore. people are suffering. just because millions and millions of people cannot drive,

they can't go to school, can't even have insurance, leaveing us here every day. this is america that we are living in. is this america in the situation? in 2008 many community members of this nation vote for change. and we vote for people who can end this people's suffering. we've been waiting, waiting, waiting. but since that, our president, our congress member, they are here. now we say we can't take it anymore. wake up. do something. we are asking now. we cannot take this anymore. on march 21, all people from all across the nation will be coming. in l.a. our community member will have a diner, we start with the food. we raise about $50,000.

people bought a plate and they will be coming to d.c. young people they are going to rent a van and drive, not only l.a., but chicago, and all over the nation. they are coming to d.c. for america. we care about this country. and we need a real action, real answer, obama. real action from the congress members. time is right now. thank you. [applause] >> thank you, dea. our next speaker is nitzasegui. >> good morning. i'm nitza and also a member of the national alliance and latin american communities. it's a network of over 80

immigrant organization located in 15 states throughout the united states. we advocate for public policies that are addressing migration and work to improve the quality of life in the communities and countries of origin. nalacc joins to denounce the deportation and tension by immigration and custom performance of agency i.c.e. and to call the president obama to enforce a broken immigration policy that is simply immoral. and immigration system that breaks families apart and that continues to reinforce the notion that immigrants particular, particularly those of latin american region are a threat to our nation is just immoral. to continue to use the objective, illegal immigrants is the humanizing and opens the

door for right-wing extreme ataxes on our communities. the branding of human being is the legal must stop. while campaigning, president obama talk about the invaluable contributions by today's immigrants and how mistaken it was to blame immigrants for our nation's ills. because we know that president obama understands the immigration system is broken. we demand that the hard working immigrant and their families, he focuses on fixing the broken and wasteful immigration system and insulting the problem that conflict the majority of people in our society. lack of employment, loan crisis, lack of reason with affordable access to health care and the predatory behavior by banks and other financial institutions.

nalacc will continue to work that truly reflects the best traditions of america and who we are as a country of immigrants as well as the principals of justice and equality for all in a founding principals of our nation. mr. obama, we are the people. stop deportations. we want a sustainable immigration policy now. thank you. [applause] >> our next speaker to speak on how we're going to hold our leadership accountable, how we are going to march, how we're going to continue to fight is linda, board member of the new york coalition. >> good morning. my name is linda, at the

umbrella of 200 organizations throughout the state of new york. i'm here today to tell president obama we need reform and we need it now. for our nation security and prosperity. we need it to keep our families together. isn't that what this country is all agent. coming from new york, i have to say that our senator, senator chuck schumer has taken the lead on pushing immigration reform on the senate. we want to thank him for his effort, but efforts alone has not stopped the pain and suffering in our communities. we understand that later today, senator schumer, senator graham, and president president obama will be meeting. our message to them is clear and simple. do not come out of that meeting until you can commit to immediate steps to end deportation and concrete plan and timeline on immigration reform and legislation this year.

: today i stand here from new york but on march 31 thousands of new yorkers will be ascending on the capital. comprehensive immigration reform this year, not next year. now. thank you. [applause] >> our final speaker is emma lozano. >> i come from chicago and also from the church of alberto where

-- and we will be back very shortly. we are here today to tell president obama, nancy pelosi, harry reid, chuck schumer and our senator, dick durbin that they need to have more courage. our congressman luis gutierrez. you have only 13 days left to keep your promise to the latino community. remember, if it wasn't for them you wouldn't have won that are now the new blue states that were historically red states. if you don't come do what we ask to you do, what you promise to do, we will leave you where we found you before we voted you into office. because, amigos keep promises. [speaking in native tongue] you don't act like our friends? you have not only broken

your promises to move immigration reform, you have made the situation worse. deporting more people, separating more families, breaking more of our children's hearts than did the republicans in their final aggressive year. you have the power. you must use it or you will lose it. we will not live peacefully in a nation that is at war with our community and with our families. don't mistake our faith for weakness. remember what jesus said, i did not come to bring peace but a sword. what god has put together, no man, no government, no party, should tear apart. we will put on the armor of the lord and we will come to washington. it is showdown time. we are united more than ever

before and we will mowingize doctor -- mobilize than ever before. you know how we are because we've had largest mobilizations in the history of this country. we have 200 buses scheduled to leave chicago. they are preparing to join the march for america here in washington, d.c. on march 21st. the ground is already shaking. i can already hear the footsteps to the capitol. justice delayed is justice denied. we will be in washington with all of our families, all of our churches, all of our young young men and women. all of our children. and we pray god sends you there to meet us with a bill already introduced, not a blueprint, like i said, a bill already introduced and moving both in the house and senate. washington, from now on, --

[speaking in native tongue] stop the raids, stop the deportation, stop the separation of families. [speaking in native tongue] [applause] >> so we're coming to washington from each of the coasts. we're going to be here. we're going to be in the tens of thousands. we want our voice to be heard. we want our demands to be listened to. most importantly we want results. this concludes our presentation portion of our press conference. we are now open for questions from the press, and what i ask, is that the speakers come forward, and that you as members of the press actually address the speaker that you would like to answer the question, if that is the case. >> [inaudible]. >> i guess it is addressed to you, mainly. for what specific or realistic window of opportunity to you see for

cir in congress, you know? nothing has happened so far. we'll see what they have to say after the meeting this later this afternoon, are you concerned that that window is closing on you and what would be a realistic framework to get it done this year? >> well, we are very clear that that window is closing and that's why we are going to seek to open it wide open, because we need to make sure that our representatives actually do their job this year. and, there's an opportunity to actually put the issue of immigration reform on the calendar, to have a debate and to vote on the issue. that is our expectation. it can happen if there is political will. and political will comes when communities across the country lift up their voices and pressure their elected officials to do their job. thank you. yes? over here.

>> [speaking in native tongue] what is your position to -- because people are afraid to be deported? >> answer that? >> well, let me be clear, we're adamantly opposed to boycott of the census. the census represents $10,000 person to every person that come pleents the -- completes the reform. we would be insane to boycott the census and to put our communities at risk of receiving those financial dollars. in addition the census will help latino and immigrant communities to pick up needed seats in the u.s. congress. we're expecting pick ups from range of two seats in texas to several seats in california and many seats throughout the united states. if we're not counted, we won't have the chance to even engage in that whole redistricting process. there is no boycott. we do not support such a thing. on the other hand, we have asked the president to stop the deportation, stop the

raids, stop enforcement activity during this critical time frame. his predecessors, both republican and democrat have honored that request in the past. this year the president has denied it. we think that is a huge mistake. we don't understand what his we don't understand what his rationale is for/g%7@ @ @ thanks. >> yes? >> a.p. i guess i address this to those of you in washington and those of you that understand the politics of everything. there is a high popularity rate among hispanics for obama or there has been since last i

checked. there is some legislation that has been passed that could greatly benefit latinos in the u.s. there are some rialls about realities about the latino vote that is not expected to be out until midterm. vot probably lower. and there's some retall alties about the party that you are criticizing and what some of the things they stand for that might benefit the hispanic community. so i'm wondering if you're asking people to, if you're saying, emma you said it, there is no reelection if, that there is no immigration reform. who do you think the people will vote for, and will they just stay home and, does it benefit you to, create, make this criticism when there are some political realities out there that the democrats are facing, some of them in,

you know, borderline districts? some democrats elected in conservative districts that may not get ereelected again because they're pushing in through health care reform. >> [inaudible]. >> first of all the democratic leadership needs to understand that when you talk to latinos, you talk to any of the american people and you make a promise, that you should keep your word. first of all. there is always a consequence, whether you're a child, and your mother told you to do something and you said yes and you didn't do it, there is always a consequence. it is the same consequence. it's okay to criticize the president and the democratic leadership when they failed to do what they said they were going to do. if you don't apply that consequence, there will be no change. historically you have to prove to them that they will have to pay a consequence in order to change. look at as we're disciplining our children. >> and i would like to add

that we expect our leaders, our elected representatives to come to washington, d.c. and actually to get a job done. all of us come from different communities. we're outside of washington. we're the ones who hit the pavement and encourage our community to come out and vote and every single person who votes expects when they come to washington, they're not just bickering with each other but they're actually understanding that they have the power to change people's lives and that's our expectation so we are in search of that leadership. if the leadership has not been elected yesterday yet, we will find that leadership and we'll elect them into office. another question, please? >> [inaudible]. "washington post.". does this, do you think this tact you're taking today represents a change in your strategy? i remember early on just after president obama took office, talking to some of you and the feeling seemed to be, you know, we understand he has a lot on his agenda.

we really want some kind of immigration change this year but we understand it may not be the first thing. it might even take more than a year. there was a sense that, you know, he has a lot of other priorities and that you were sort of understanding of that. today's tone struck me as markedly different. would you characterize what you're talking about today as a change? >> the answer to that is yes. i will pass this over to pramila jaypal to answer the question. >> absolutely. we have been patient. we all understood there were many things on the table. but the reality is immigration reform is about economic recovery, it is about jobs. it is about getting the country back on the right track. now we're saying we are waiting. we see one of the best economic recovery packages being ignored because of lack of leadership and lack of courage. i think we understand how intertwined the immigration system is with everything else that the economy, that we face in the economy and everything else that america

faces. we're not ready to wait anymore. it doesn't make nick economic sense and doesn't make moral sense. we're out of time, out of patience and ready to push forward all of the power that we have collectively in our states across the country to make sure that we really are going to get 4 change that was promised to us. >> i also want to add to that, some of us, despite our understanding of so many things that needed to get done, we are agree on something. administratively, president obama could have done certain things and stopping deportations was number one priority for our community. instead, this is happening. and if it doesn't stop, and if we don't say it now, it will continue growing. and it will be late. and yes, sometimes the democratic party thinks that

us. we want to let you know i you don't. if you do the right thing you will have us. if you don't you don't have us. that is just the bottom line. we're tired. it is time for action. >> yes? >> hi, my name is --. reporter from -- times. i have a question to mr. yoon. you told me that, deportation, from many korean people, think, illegal immigrants, undocumented immigrants are latino issue, not the korean people's issues. i met -- she told me around 240,000 korean-american jobs, illegal immigrants, that means undocumented immigrants. do you have any information about how many core reason people were deported last year, according to data.

87, 790 people were deported. among they will them, how many people korean people? >> i just want to say, not about latino issue. it is not about asian issue. it is not about korean issue. it is about people's issue. your members of community, your neighbor, your church member and their children are crying looking for their mother. the young people can't go to school. they can't even drive. is this about race? no, it is about people's issue. we talk about economic power and boosting america's economy. legalization is one thing. people get legalized. they get driver's license. by buy car, auto insurance and, automobile, factory they hire workers. and they buy a house. we have, you're going to have boost of construction economy. it is best way to get our

community back on the track. and for korean-american, one out of five korean-american are undocumented i am mp gray grants. -- immigrant. into this country 50,000 pacific islanders. people are caught in backlog. they're waiting to be reunited with their loved ones and family. on top of that 1.5 million a. pi undocumented. it not about api, latino. it is about people issue. what are you going to do about that, america. >> others?. >> hi, i'm lauren north from "nation" magazine. i wonder if you can talk a little more what you envision for comprehensive immigration reform. specifically looking the at something like i.c.e. which consistently abused its power. has detentions that are hidden and abusing human rights on a consistent basis. i just sort of would like,

we are using the term comprehensive immigration reform. what be interested what you mean by that. what are the bare minimums you are looking at? what are the bare reachs? what is the ask? >> right now first and foremost what we're requesting is political action on comprehensive immigration reform. comprehensive immigration reform means relief to a our families. that relief comes to legalizing 12 million undocumented migrants in this country many who are children. relief means, uniting families, reducing backlogs. making sure that families can be together. it means workers rights. it means workers rights for immigrant workers and for native-born workers so we actually have good wages and good jobs that we can all, in an america we can all feel proud of. we're talking about due process. we're talking about fair treatment in every aspect of life. that's what we mean by comprehensive immigration reform. that's why we march. that's why we vote. that's why we're not going to give up until it happens.

another question? >> [inaudible]. first part of my question. the second part is, -- [speaking in native tongue] >> [speaking in native tongue]

[speaking in native tongue] >> in chicago we sell ticket for $100. if we don't have the money, financing of $5,000 -- we go to the local business. they help us. this is how the people's campaign. we are financing this campaign. we have other sources but not much to do it. we have to go from --. each, bus, 5,000 for 200 buses is one million dollars. to bring 10,000 people from chicago to d.c. >> [inaudible]. >> dancing and singing in the streets for our church. they're out there singing and dancing so they can come be a witness to this

historic march on america so they can keep their family together. [speaking in native tongue] >> we're doing a lot of grassroots actions to get to washington, d.c. and we'll get here on the 21st. [speaking in native tongue]

[speaking in native tongue] >> we're fighting for comprehensive immigration reform because what was promised was comprehensive immigration reform and income prehens sieve immigration reform you have the dream act that will help students. ag jobs that will help farmworkers and comprehensive immigration reform, seeks not to leave people behind and so that it helps people living in urban areas in the same way that it helps people in the rural areas and that's what we're fighting for so all our community has relief. >> [inaudible]. >> [speaking in native tongue] >> next question, please? >> yeah. this might be something too technical and we can make talk afterwards but how much of a sense do you have the

breakdown of this increase in deportations? my understanding from reading that report it is specifically refering to deportations conducted by i.c.e. as opposed to other forms of removal or voluntary departure or border patrol removal. just that figure there, do you know what the cause of such a large numerical increase? and, in particular, as you know, the administration did make a, you know, announcement they were ending the kind of worksite enforcement we had seen in the last year of the bush administration, to some extent seemed like that was occurring but perhaps there is other kind of enforcement going on. i'm trying to understand how much of this is expansion of secure communities, expansion of other programs and how much is that kind enforcement that particularly raised concerns in your community, like worksite raids? >> well, the answer is that every year, the last 10 years, we've increased the number of personnel committed t