senior tool pusher, mr. ezell, had been awarded -- had been given a transhe ocean award -- a transocean award, and so everybody said, great job, keep up the good work, and, you know, there was a bit more conversation about that, but then it went on to another topic. .

>> the operator had put out a mayday. was that across the dhs radio? -- the radio? >> i do not know what type of radio it was. her name was andrea. she was speaking into what looked like a radio. >> as you described, was she given any instructions to do so or she criticized for doing anything of the such? >> i am not aware of any instructions, nor aware of any criticisms. >> all right.

and as you were going through, you made several comments. there was a general question that went out to the room, and overhead question to all. should we eds, or was there some reference to eds? >> yes, sir. i think he said a general question to the room regarding something about eds. >> i feel like i said that. again, i apologize for an incomplete memory of all of those events at the moment. that is what it seems like i said. >> yes. that is fine. shortly thereafter, he said the captain kind of hesitated. >> again, it could be -- you know, there were a lot of things going on and he was thinking about something else. thinking about that, i do not know. it was shortly thereafter,

within seconds, a few seconds, and i do not even know why i noticed that. but i was just telling you everything that kind of came through my head. i remember he went then straight over to the panel, is my recollection. >> yes. and we appreciate your clarity, because it is extremely important as we are putting this time line together. you had then gone on to say the captain hesitated and later said that the captain agreed to eds, and you remember him and we do have testimony that eds was activated or there was some record of eight at 21: 56. >> i remember him saying eds at 21: 56. >> you also talked about -- there was a discussion about going to the lifeboat.

>> possibly a poor choice of words, but there was not -- when the life boats -- when the word first came out, it was not a command or an order. it was -- and i do not know who spoke it. but it was just kind of in general -- the sort of feeling was, i guess, that we were starting to head in that direction. >> i understand. you went on to say there was not a consensus on the bridge to actually go forward with that. as you said, mr. pat -- is that mr. pat o'brien? >> it is.

>> he said let's go. >> i remember looking at him, and i think that is what he said. >> in the testimony provided, you mentioned something about mr. don. -- mr. john. >> john windslow. could you be specific about which comment? >> he was wanting to excuse himself and you had made a comment about something like, "that is all right." he wanted to take care of something. i am not sure what it was. >> that was in reference to don vedrine. he came up at dinner and asked if i wanted to participate in the 7:00 meeting. >> did don explained to you why he may not want to attend this vip dignitary visit?

when >> i cannot recall with certainty whether he said anything that was going outside or not. >> outside meaning the drill floor? >> yes, or anywhere else on the rig -- what was going on. >> ok. thank you very much, mr. simms, for making yourself available -- mr. sims, for making yourself available. >> we have no questions at this time. >> we are not getting you at all. >> thank you, captain. we have no questions at this time reserve the right to present questions at a later time. thank you, sir. >> did he say no questions? >> he said no questions, but he reserves the right to ask

questions when the witness appears before the board at a later time. >> who was that that said that? >> that was mr. gregory bensoli, from the republic of the marshall islands. >> bp has no questions for the witness. >> what was that? we missed that. >> we really cannot hear anybody in the audience. if you would not mind, can you relate what their reply was? >> yes i will. the council for bp did not have any questions for that witness. >> no questions at this time. >> no questions from counsel for [unintelligible]

douglas brown? >> we have questions. >> yes, sir. >> does he have questions? >> yes, sir. the council for douglas brown has questions for mr. sim. >> what is councils' name? >> he will announce his name. >> that would be steve gordon. >> that is not really clear. >> steve gordon. >> would you come within the radius of the phone? >> council, can you hear me? >> what is your name? >> steve gordon. may i proceed? >> yes.

>> mr. sims, once again, you are drilling operations manager for bp, correct? >> currently for the relief wells being drilled. >> what is your other title? >> that is it right now. >> ok. >> before, i was drilling operations manager for exploration and appraisal wells. >> was the word completion ever part of your title? >> um -- honestly, i would say it has been -- the title has been written a number of ways. the ops manager, wells ops manager -- it has been written

both ways. >> once again, has the word "completion" ever been part of your title? >> completion would be what the c stands for d and c -- drilling and completion. so, yes. >> can you tell me what was bp's outlook of the crew of the deep water horizon -- the deepwater horizon? >> would you explain what you mean by outlook of the crew? >> i have been told by bp that they were considered the a team. is that true? >> are you asking him what bp said or what he thinks about the crew? >> why did he think about the deepwater horizon crew -- what did he think about the deepwater

horizon crew -- that is my question, for mr. sims. >> the rig and the crew had good performance since i had been associated with that rig. >> and do you have knowledge whether people in management like yourself had asked trans ocean transtransoce-- transoceao clone the crew at because there were such good workers? >> what do you mean by clone? >> the wanted to duplicate them to work on other deep wells. >> can you ask the question again now that we know the meaning? >> do you think management in bp sought transocean to try to "clone" the crew so that

other vessels would be able to operate as effectively as the deepwater horizon vessel? >> i cannot honestly say that i recall that were being used -- that word being used. i think that bp felt like it was a good rate and a good crew -- a good rig and a good crew. i do not recall the word clone being used. >> let me ask you, sir -- would you have liked to have a crew like the deepwater horizon crew on the other transocean vessels that dig wells for you? >> are you asking him to

speculate on that? >> i am just asking for his opinion on the crew. >> i think the answer was it was a good crew. >> ok. you were there for a routine safety audit, correct? >> i would call it a leadership visit. >> a leadership visit. it was not for a safety award, correct? >> that is correct. >> who did you go up there with, sir? >> pat o'brien, john wins low, dubuddy trahan. >> are those people considered executives of bp and trans ocean? >> the witness answered "i suppose."

>> we thought we heard an objection. >> this is ned. [laughter] >> hold on. i could tell it was ned. [laughter] >> [inaudible] >> let me a lot him to lodge an objection, here. >> my objection is this witness is being asked to render an opinion about whether certain people within a different organization might be viewed in a certain way by certain people. it is well beyond this witness''s ability to make that judgment. i think that on his own, he would say he cannot make that judgment. i want this record to reflect that it should not be made. >> he is not going to answer that.

he is only saying he thought it was a good rate and a good crew. he is not going to say what someone else might have thought of them. >> i think at this point he is asking whether certain people on that rate at that time could be considered executives are upper management. that was the question i objected to. >> ok. >> i agree with his objection. >> i just want to ask another question. i am good. >> ok. [laughter] >> if transocean -- if the two members had been giving a safety award, they would have told you about that when you traveled with them out there, right? >> he is not going to answer any question with that level of speculation. >> did you talk about what you were going to do when you were in the helicopter going out?

or was everybody quiet? >> well, not to sound flippant, but in a helicopter you really cannot have a conversation. in the time before that, the only thing that i recall don winslow saying was that he wanted to have a meeting -- set up a meeting ariwith rig leadership sometime during the visit. that was the meeting that was set up for roughly 7:00. >> thank you so much. one last question -- i am sorry. two questions. do you know a lady by the name of rachel clingman.

>> i do not know her. >> she is a lawyer for tr ansocean, and she was out before the house judiciary question on -- the house judiciary committee on may 27. >> he has already indicated that he did not know her. >> i am just went to ask a question. ok, fine. did you know that -- >> hold on. an objection has been raised. >> i know rachel. she is a lawyer who testified in washington. what he wants to do is read something she may have said before a panel in washington to this witness. >> you do not know what he is coy to ask. is this a direct question? >> it is. >> did mr. sims know that rachel clingman, under oath before the house judiciary committee, said that the transaoscean

executives or on board to give a safety award? >> you can answer yes or no. it is a statement of fact. >> did i know that she said that? no. >> thank you. >> thanks, sir. >> transocean, d you have any questions for the witness? >> not at this time. we would defer any questions. >> i appreciate that. >> we did not hear that, capt.. >> no questions from transocean. this is not a legal proceeding. i have no doubt the definition has been [unintelligible] [laughter] >> council cameron, we have a

question for you. >> good afternoon, mr. sims. can you hear me? >> yes. >> my name is david jones. i represent cameron. i believe you testified earlier that it was after the second explosion that the lights went out on the bridge. is that correct? >> that is correct. >> you also said that the lights went out on panels on the bridge. is that correct? >> no. i said that it was dark in the bridge and it was difficult to read or determine any words from the panel. >> did you ever observe the

lights go out on the b.o.p. panel? >> i did not observe the lights go out. >> all right. how did you know, when you said you turned and looked at these b.o.p. panel, how did you know you were looking at it? had you seen it before? >> i had seen it before. >> it is a fairly large panel, correct? let me ask it this way. can you describe it for me? >> it is probably 5 feet high and i would guess 3 feet wide. >> ok. the panel has two sides that are just about 5 feet tall and 3

feet wide. is that your understanding as well? >> i do not know. >> ok. whatever the panel you were looking at and that you believed to be the b.o.p. panel was about 5 feet tall and 3 feet wide. is that fair? >> the panel that i looked at that had buttons that i believed were associated with individual eop components looked to be about 5 feet high and about 3 feet wide. >> ok. i think you said that you saw green lights, yellow lights, and one red light on that panel. is that correct? >> that is correct. i saw a green and yellow light side by side, green on the

light -- green on the left and yellow in the middle, for what appeared to be the b.o.p. component in the stack. >> ok. i thought you said the one read like you saw was at the top of the panel. is that correct? >> i would characterize it as toward the top of the panel. >> do you know if there were any lights above the red light you saw? >> i do not recall any about it. >> ok. -- i do not recall any above it. >> you have a red light toward the top and anything you have yellow lights and green light side by side as you are going down. is that your recollection? >> it is my recollection that the red light was the uppermost

light that i recall seeing, and below that the lights there were green and yellow light side by side. >> we heard a discussion about seeing the captain and the captain going over to the b.o.p. panel. did you see someone activate the eds? >> i did not see the button pushed -- specifically see that. no. >> and then at some point after the captain went toward the b.o.p. panel, but you look at elides and saw there were no different. is that correct? >> i glanced at the panel shortly after that, and my recollection is that there were no red lights -- there were now

red lights on what looked to me to be all of the -- next to all of the green and yellow lighits. >> were the green lights off or were the green lights still on? >> i cannot remember. >> all right. were any lights blinking? >> i did not notice and the blinking lights. >> when you say you glanced at the panel, how long did you look at it? was this a quick look and then you went back to looking at other things? >> i would consider that a -- yes. a quick look, a couple of seconds at the most. >> ok. i believe that is all i have. thank you.

>> thank you, mr. jones. halliburton? >> halliburton has no questions at this time. we may want to ask questions when the witness appears in person. >> halliburton does not have questioned at this time reserves the right to ask questions when you appear in person at the appropriate time. >> no questions at this time. the drill equipment council indicates no questions at this time. weatherford dictated no question at this time also. mr. sims, thank you for your testimony today. any questions that we did not ask or any information that has relevance to this investigation that you would like to offer? >> no, sir.

>> if the board needs you to appear before the board in future times to provide additional information, william h. yourself available? >> yes, sir. i will do everything i can. i appreciate the grace that was given to me to testify here verbally. i really appreciate that. >> yes, sir. thank you. >> thank you, counsel. >> thank you, sir. >> i need to do about 5 miles. host: [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] clacks we have sufficient time to offer evidence for the board to consider and for us to prepare for the technical verification phase of the

investigation. we are planning to hold the next sessions in the later part of july. i request that all party interests who submit their request to the board by the end of june if possible. throughout the course of our investigation, we will identify additional parties and interests as appropriate. based on the conduct of those operating as licensed officers on the deepwater horizon, to date the board will report letters that support their interest. this hearing is adjourned. thank you. >> that wraps up the hearing

conducted by the coast guard interior secretary ken salazar, janet napolitano, and the mineral management service. investigators are empowered to call on the justice department to begin prosecution proceedings, should criminal misconduct be found in the course of this investigation. we refer you to our website, c- span.org, to follow the story and to use the video library to see hearings and events related to the spill. more on this investigation as we show you testimony from yesterday in this hearing. >> thank you for being here. please raise your right hand. lying to the government of the

united states is punishable by fines and prison. knowing this, do you solemnly swear that the testimony you are about to give will be the truth, the whole truth, and nothing but the truth, so help you god? >> i do. >> please be seated. >> mr. ezell, for the record, could you please state your name and spell the last? >> charles randall ezell. >> business representing trans ocean. is that ok with you? >> yes, sir. >> by whom are you employed? >> transocean. >> could you lean into the microphone? thank you. what position do you hold?

>> i am the senior till pusher. >> how long have you had that position? >> approximately four years. >> prior to becoming a senior tool pusher, what experience did you have? >> i have had a total of 33 years offshore. 23 of those have been with transocean. >> can you briefly describe your responsibilities as the senior tool puishesher? >> a lot of my responsibilities are administrative. that is to support operations wherever needed. >> what type of operations are those? >> that would be drilling operations. >> how long have you been assigned to that --? >> eight-plus years -- not quite nine.

i was one of the original crew members in 2001. >> on the hitch that you were on at the time of the incident -- what time did you arrive on me deepwater horizon? >> i do not remember the exact day. it was approximately a week prior to that. >> up to the time of the incident, were you aware of any incidents with the well or the pipe or anything you might be aware of? >> i was aware of circulation areas that we had. >> what was the last lost circulation that you were aware of? >> during the last week that i was on the rig, the well was actually stable. we did not have any loss event.

>> was there any stuffed pipe in that last week? >> not in the last week. >> was there any problem that came to mind? >> non-that i was made aware of. >> do you have communication with the halliburton reps on that rig? >> yes. we talked to them quite frequently. >> did they have problems with any tests or any sheering pins in that production casing? >> i think we had a little bit higher pressure on me shothe shore trace track than normal, t excessive. >> in the next few minutes, give me from the day in the incident up to the time of the incident what you can recall. >> starting from the morning, right? >> yes, sir.

please. >> we typically have a 6:30 meeting first thing in the morning. that is with the transocean management. after that meeting is over, we rose into a bp meeting that they have with houston, their morning meeting. that would have been approximately 7:30 when that meeting started. after that, we have a transocean supervisor meeting that is all the department heads. we have that daily. that would have started about 8:30. and it was pretty extended because we had talked about some of the issues, like one program we have was called a drops program. it was meant to control dropped uoptics.

we went over that to some degree. it probably would have lasted somewhere in the neighborhood of an hour, an hour and 15 minutes. then, of course, i made a round to observe several operations. i made a trip to the rig floor. i came back down -- >> what time was that? right after the 8:30 meeting? >> when i was out of debt -- out on deck, it could have been around 10:15 to 10:45, something like that. then, of course, we had lunch. i talked to jimmy harold pretty extensively. we were going over our 2010 rick goals and making sure we were updated on that -- our 2010 rig goals and making sure we were

updated on that. we had a vip group that came out from bp and transocean. we were going to have a general tour of the rig with those individuals and several of the department heads. we did conduct that tour. we went to several different areas on the rig. one of the last areas that we went to was the rig floor. there, there were already conducting the negative tests. >> the first or the second? the first negative test? >> the first negative test. and the tour group left, and left jimmuy and myself there. there were having a little bit

of a problem -- they were having a little bit of a problem, the drill group conducting that test. we observed that they had lost some mud in mthe riser. i witnessed jimmy telling beathe senior sub-sea engineer and to increase the pressure. when he did increase that pressure, it became static. the of course filled the riser up. we monitored and made sure everything was 100%. it was, like i say, static. the other tool pusher that was coming on at 5:30, jason harrison, had come on at that time. he and his relief were

discussing the events of the day. lyman was briefing him on what was going on. of course, the bp company men, bob and don, were there. they were doing the same thing. they were relieving and handing over, so to speak. i went outside of the rig floor, and i talked to the assistant driller, steve curtis, for a few minutes. i was going to let them have their discussion, you know -- have the formal handover. when they did that, i came back in. after talking to jason, the tool pusher, it was my expectation that they were going to stop the job at that point. they were going to have a

meeting. that would have beendo don vedrine, jason, the sub-sea engineer, gordon jones. they would discuss about what had gone wrong and what they were going to do on their second negative test. at this time, it had gotten to where it was a little after 1800 hours. our meeting was at 1900. jason told me -- he said, "why don't you go eat?" i said, "i can go eat and come back." he said, "i have got this. do not worry about it. if i have any problems with this test, i will give you a call." i knew jason well. i worked with him for eight or nine years. i know we all know that when you

know somebody that well you can even tell by their body language is something is wrong. he was just like a brother. i had no doubt that if he had any indication of any problem or had any difficulty at all he would have called me. well, i went ahead and ate. i did attend the meeting with the dignitaries. that lasted until shortly after 9:00, or right around 9:00. from there, i went to the galley and got something to drink. i spoke to someone. a camera or who it was in the galley. i made my way back down to my office. when i got to the office, i looked at my watch. of course, everybody has different timepieces. it was 9:20 by my watch. i called the rig floor and

talked to jason. i said, "how did your negative test go?" he said it went good. they watched it for 30 minutes and had no flow. i said, "what about your displacement? how is it going?" he said, it is going fine. it will not be much longer. we already have our place your back. i said, "do you need any help from me?" just like he told me before, he said "i have got this. go to bed. i have got it. ." he was that confident that everything was fine. i went to my cabin, which was a short distance, probably 5 feet away from the tool pusher's office. i closed the door and prepared for bed. i think i called my wife and talked to her for a few minutes. that went along 15 or 20 minutes.

i had laid there and turned my overhead light off in the bunk. i was still watching a little television. my room phon e rang. i hit my little alarm clock light. according to the alarm clock, it was 10 minutes until 10:00. the person at the other end of the line there was assistant driller steve curtis. steve opened up by saying, "we have a situation." he said, "the well is blowing out. we have mud going to the crown." i said, i was just horrified, i said, "is it shut in and?" he said jason is shutting it in

now. he said randy, we need your help. i will never forget that. i said, "steve, i will be right there." it took only minutes for me to put my coveralls on. i put my socks on. my boots and my hard hat were right across that hall, i was telling you, in the tool pusher's office. i opened my door. i remember a couple of people standing in the hallway, but i kind of had tunnel vision. i looked straight ahead. i did not even remember who those people were. and about the time i made it to the doorway of the tool pusher's office was when a tremendous explosion occurred. it blew me probably 20 feet against a bulkhead, against the wall in that office.

i remember then that the lights went out. i remember everything deathly com. -- deathly calm. my next recollection was that i had a lot of debris on top of me. i tried to different times to get up -- i try twied two diffet times to get up, but what ever it was it was a substantial weight. the third time, i guess adrenalin kick in. i told myself, "either you get up or you are going to die." my leg was caught on something. i do not know what. i pulled it as far as i could. it came free. i attempted to stand up. that was the wrong thing to do. i immediately stuck my head into

smoke. the training we have all had on the rig -- i knew to stay low. i dropped back down. i got on my hands and knees. for a few moments, i was totally disoriented. i mean, i have lost orientation on which way the doorway was. i remember just sitting there and just trying to think which way is it. then i felt something that felt like air. and i said to myself, "well, that has got to be the hallway. that is the direction i have to go. that leads out." i had to crawl very slowly, because that end of the living quarters was pretty well demolished, debris everywhere. i made it to the doorway. and what i thought was there was actually methane.

and i could actually feel droplets. it was moist on the side of my face. i continued to crawl down the hallway slowly. and i put my hand on my body -- on a body. it was mr. wheeler. i did not know that at the time because there was no light. i did not see. the next thing i recollect is i saw like a beam of light like a flash light bouncing. i guess it was because this individual was coming down a hallway and it had all the debris hanging from different places so the light was going up and down as he ducked and went through different things. he came around the corner there and i saw that to be our electrical supervisor, stan carter.

along about that time, jimmy harold, the oim, came out of his room. he had managed to find a pair of coveralls and put those on. he told me he was in the shower when the explosion happened. and he was gritting his eyes really hard. he said he couldn't hardly see. he said, "i think i've got something in my eyes." i looked down and he did not have any shoes, either. i said, "jimmy, i have wyman downd right here." he said, "let me see if i can find some shoes." stan and i were in the process of trying to remove some of the debris off of wyman. at that time, or about that time, another flashlight

entered. that was chad marie. -- chad murray. we asked him to go to the bow and get a stretcher. we continue to remove this debris off of wyman. i helped him up. i was, in my mind -- i was going to try to help walk him out, thinking that it might be quicker to walk him out. well, he made a couple of steps with his arm around my shoulder and he was in pain. he said, "set me down. set me down." so we set him back down. and he said, "you'll go on and save yourselves." i said, "we are not going to leave you. we are not going to leave you in here." about that time, i heard another

voice saying, "god help me. somebody please help me." i looked to where our maintenance office had been. and all i could see was feet -- a pair of feet sticking out from underneath a bunch of wreckage and debris. we worked to get that off of this individual. we did not know exactly who it was. but when we got the debris off of this person, we saw it was buddy trahan, who was one of the visiting transocean dignitaries who came out for that trip. looking at him, we saw that the extent of his injuries were greater than that of a wyman's, so naturally he got the first structure. so we loaded him on the stretcher. it took three of us because we had to remove debris. it was hanging from the ceiling

and the walls jutted out. the floor was jutted up. it was total chaos in that area of the living quarters. but when we got him loaded on the stretcher, stan and chad conveyed him all the way out the front of the rig, the bow of the rig, to the lifeboat station. i stayed right there with wyman wheeler because i told him i was not going to leave him, and i did not. it seemed like an eternity, but it was only a couple of minutes. they came back with the second strucetcher. we were able to getwyman on that stretcher. we took him to bow of therig. when we got outside the living quarters, the first thing i

observed was both of the main lifeboats had already been deployed and had left. i also looked to my left and i saw capt. kurt and a few of his marine crew starting to deploy a life raft. and we continue down the walkway until we got to that life raft. we set the stretcher down. and after several minutes, so we had everything deployed, the chief mate, david young, and myself, got in the life raft. we were able to catch the head part of the structure and assist getting wyman into the life raft. i do not know if any of you have ever been in a life raft, but it is hard to keep your balance, especially if you have any type of weight.

i think we actually felt try to get him into the life raft, but the main thing is he was there. he did not get left behind. from that point, we were lower down. and i believe that was by the captain, for the best of my recollection, made it to the water. i remember intense heat. i remember fuel, ore, oil, or some type of hydrocarbon burning on the water extremely close to where our life raft was. the painter was still attached to the rig. we did not have a whole lot of light. we were looking through the provisions, trying to find a

knife. i was pulling tension on the painter, thinking by chance maybe it might part. it did part. unbeknown to me, at that exact moment it did not part. it was cut. the captain of our rate was able to get a knife and cut the painter. from that point, i remember being thrown a rope. i think it was from the fast rescue craft. from there, they were able to tell us -- to tow us safely away from the rig. >> thank you. when you had the communication with mr. curtis on the rig floor, to keep suggest possibly

lining up to the gas line a diverter? >> no, sir. he did not. >> all he said to you was there were having a well control situation? >> yes, sir. >> to your knowledge, is there any policy within transocean to lock out any portion of the stack at any time? >> no, sir. i am not up -- i am not aware of a policy that would state that. >> are you aware of any time that any of the function was impaired? >> i am not aware of that. >> were you aware of any b.o.p. stack issues prior to the incident, whether from being splashed or once it was on the sea floor? >> no, server. >> were you ever aware of any leaks on the accumulator system? >> no, sir, i was not.

>> do you know who is authorized to activate the emergency disconnect system? >> it would be the captain, the oim, the senior tool pusher, myself, tool pushers, drillers, and subsea engineers. >> did you say the capt.? >> i did. >> do you know who activated the eds? >> i do not. i was not on the bridge. >> did you have any communication after the incident with anyone who said they tried to activate it? >> i have. >> who was that? >> chris pleasant. >> with your background as a tool pusher, are you familiar with the eds system?

>> pretty well. >> is there any way to delay activation within the logic of the system? >> delay it? >> could you hit the control panel and then hit eds -- is there any way to delay function to have the lower riser package come off? >> there is no way to delay that. >> are you familiar with the auto shear system? >> the auto sheered? yes, sir. >> is there any way for that to be disabled? >> that would be a question that would have to be directed to the subsea engineer. i am not aware. >> thank you. at the time of the incident, when the were displacing the riser, who was monitoring the volume coming in and the volume goong out? >> as far as real time data, to

the best of my recollection that would have been our sample -- not our sample catcher. it's a person who would be managing the unit. his name is joseph. >> do you know his last name? >> keith, i think. >> do you know it joseph keefe was taken off the floor for monitoring? >> i have no knowledge of that. >> do you know who would have knowledge of that outside of mr. keith? >> not that would be alive. >> how was the mud being displaced? what was the flow path? >> there were pumping down the drill pipe with seawater and returns were coming back up the annulus and going back to the

shakers. that was returning to the pets. -- the pits. >> is it possible to off load to the offshore supply vessel? >> offload from a supply vessel? >> from the reagan to the offshore supply vessel. >> not to my knowledge. that is not an option. >> earlier, you mentioned you had vips from bp and transocean out. i think i wrote down you had a meeting with them at 9:00. >> that is when it ended. from 7:00 to about 9:00. >> did you discuss the issues with the negative test? >> no, sir. we did not. we had a whole different format for the meeting. >> what was discussed? >> we talked about the work that

we were going to do in the shipyard in 2011. we talked about our drops campaign. we talked about our 2010 goals for the year. >> the bp guys elaborated on how good a job we had done in seven years without a loss incident, and how proud they were of the rig. it was a lengthy meeting with all those main topics, there. >> correct me if i am wrong. was one of those gentlemen mr. o'brien from bp? >> pat o'brien? >> he is the drilling and completions manager, correct? >> i believe that is right. >> he was on the rig floor when

they took them off and went somewhere else while he stayed behind on the first negative test "were having a problem? >> pat o'brien did not stay behind. >> did they actually know that something was going on on the rig floor about the negative test? >> i am sure they are aware that something was not 100%. >> at no time during that meeting did the drillings and completion manager mention anything about the negative test that had a problem? >> there was no mention of it whatsoever. >> did they bring up anything about where the rig was going? you mentioned the 2011 shipyard visit. did they mention anything else, by chance? >> would you repeat that, please? >> did anybody from bp bring up that deepwater horizon was scheduled to go to [unintelligible]

>> not that group. >> in your experience at deepwater horizon, how often did bp come to the rig with vips? >> how often? >> yes, sir. >> three or four times a year. i am just guessing. >> would normally be a drilling and completions manager, mr. o'brien? >> that was actually the first time i have seen that man. >> are you aware of any type of transocean policy that has been implemented since the incident? i know you have not been back to work, but are you aware of any type of policy? >> i have not. i have not had any communication, really. . .

it was probably the best record that bp had, too. >> q never felt any pressure from anyone at any time -- you never felt any pressure from anyone at any time to get to

another location quicker? >> no, sir. >> no further questions. thank you. >> mr. ezell, at was quite a series of events you detailed there. i'm not going to take you back through that. could we go back over the earlier events from 10:00 till when the meeting started? were you on the rig floor when they discussed the negative tests? >> i would have been out there -- this is a time estimate. i would have been up there sometime around 5:30. that was around the time when they were doing very relieving. -- their relieving. atdoesn't it -- that was

6:00? >> we call it working from 6:00 to 6:00, but they typically do 30 minutes earlier. >> ok. did you hear any specific conversation about the negative tests that were going on? any discussions about wanting to repeat it or anything wrong, anything of that nature? >> well, i am relatively sure that all parties -- beat the entrance ocean -- were not happy with the first one -- bp and transocean -- were not happy with the first one. >> you were present or someone told you that later? >> someone said they were going to stop the job and have a meeting to talk about a forward plan as far as having a second negative test. >> who told them how to conduct the test?

>> that would have been the well site leader. >> he was the one that was not happy with the way the test was conducted? i do not want to lead you. i am trying to find out what happened. >> he was not happy with the results of the first test. >> and he is? >> that would have been don vedreen. >> do you remember an exact remarks he made? >> no, sir. i had a break. there were people talking throughout the room. they were having -- the bp guys were having their discussion and our tool pushers or having another discussion. i talked to the system driller for a few minutes. >> did he say anything about the way the test was run? >> no, sir.

no, he did not. >> thank you. >> a good afternoon, sir. i am sorry. it sounds like it was a biggie -- busy day on the rig. you had a lot of meetings. is that typical to have those meetings in the morning before lunch? >> it is kind of typical. we had more meetings than we usually had. >> yes, sir. because of the vip visit? >> yes and going over our 2010 budget and talking about this campaign. that took some additional time that we would not normally have to worry about. we would be outside or doing something. >> sure. during the morning meeting, was there discussion on these events -- what was going to happen? yes, sir, there was.

-- >> yes, sir, there was. the talk about the last 24 hours and the foreword plan. >> we heard there was some discussion that they wanted a couple people to stay back and discuss what would actually happen that day. were you engaged in those conversations? >> i was engaged in a portion of that. he was adamant about conducting this negative test. just to give you a little background on that, in our transition manual, i did not believe you can find a negative test. this was something that he always insisted on. >> that is what he said. >> that is the way it was feared he was that adamant about doing it. we knew he would not the -- that is the way it was.

he was that adamant about doing it. we knew he would not deviate from that. he had another time on a rig up years back at half him a lesson. -- a few years back and that taught him a lesson. he said he would always do a negative test. in some people's minds, that could have been overkill, but it was standard procedure for us to do that. it was something that we felt more comfortable with. >> and i guessed he had a difference of opinion with someone else in the meeting? >> yes, sir, he did, with the well site leader. >> it sounds like a busy day. there was a crew change. there was a short change. what is that? >> that is when you have a crew come out and the crew that is out there have to work partial day. they get off and rest. they tried to rotate and get on

the right schedule or the right to our. >> ok. -- or the right tower. >> ok. it sounds like a crew changes happen during the negative test. >> the drill crew was not changing out. >> i thought you said mr. anderson was coming on. >> it was just a tool pusher handover. it was just the well site leader handover. it would also been the senior subsea engineer swapping out with chris pleasant. that would have been changed out. i think the mud engineers would have changed out. >> with those folks that you have described -- or they the senior people on the floor? -- were they the senior people on the floor?

>> chris was not. mark was. mark was knocking off, so to speak. don bedreen, yes, he would have been the senior person. bob had only been there for a couple of days and he was not really familiar with the rig's operations. jason would definitely have been the senior. in a lot of cases, yes, they were senior people coming on. >> those were the people making the decisions at that time? >> they would have made those decisions. >> yes, sir, thank you. you had mentioned as the tour was going through the drill floor -- it seems like it was shortly after the time where the senior people, they were going

through. you had come through. there was discussion about a way to move forward on the negative test procedure. you actually had to take someone outside -- the assistant thriller -- adopted him on the side about what was going on -- the assistant driller -- and talked to him on the side about what was going on. >> he did not have any additional input. after i left, the night will pusher came on. i told him i would come back. >> yes, sir. >> he said, no, i have this. if i need anything, i will call you. he would have called me. >> i believe you. if the tour was not going on, if there were no visitors, would you have stayed? >> yes, sir. and i would not be here talking to you. >> i did not mean to put you in that spot, but i wanted to ask

you. if that vip tour was not going on, as you're talking about it, i expect you would have stayed there. >> not only that, but if the explosion had happened at a different time, i would have been on the rif gloor. -- rig floor. i was heading that direction. i was unable to get there. >> i understand the intent of the vip tour, but it seems like the timing was critical. >> yes, sir. >> thank you very much. >> you are welcome. >> we have had a lot of discussion with the negative tests. the first test was not up to the oim's standards. what was the difference between the first and the second test? >> well, i cannot tell you anything about the second test, other than the tool pusher told me it was ok. also, don vedreen told jimmy

that it was a good test, so i have no knowledge of that second test. >> was the testing procedure being questioned by the oim on the initial test? >> it was a question, but it was not that big of a deal. i think he -- i think there was a desire from bp to have about k -- haevf the -- have the kill line open. our standard procedure did not call for that. that would have been out of the normal procedure that we did four-test. in my mind, that is why they -- than we did for the negative test. in my mind, that is why they -- everybody believed each other. they got all the data they needed reassembled to start

unquote -- to start the negative test number two. >> were you familiar with any changes in the casing program? >> no, sir. that is bp's decision -- the casing. >> but you are the one putting it in the whole, correct? -- the hole, correct? >> that is all the decision -- the design, the program. >> i am aware of that. at any point, is there anyone who mentions the issue -- we are running out of hole, what should we do? or is that only up to bp? >> subtle changes to the casing

program would be up to bp. >> thank you. >> mr. ezell, i have a couple questions for you. over the last month, i have been looking at the relationships. my understanding is that operational decision making involved the oim, the company men, and the tool pusher. >> yes, sir, and sometimes even the captain. >> for drilling. >> yes, sir. >> you are the senior tool pusher? >> yes, sir, i am. >> in your testimony, you did not have full visibility of what was going on during that afternoon, did you? >> no, sir, i did not. >> since you did not have full

visibility, part of it is that you rely on jason anderson, because he is the tool pusher who you have a personal relationship and confidence in his ability. >> can i explain why? jason -- he probably had more experience as far as shutting in than and the individual on the deep water horizon -- any individual on the deepwater horizon. he was going to be the instructor of the well control department. he had recently been promoted to senior tool pusher. he did carry an oim's license, as i did. jason was very acute on what he did. and that made me feel comfortable when he said, if i

have any problems, i will call you. i knew him that well. that is why i was able to rest at ease, because i knew there were going to do another negative test, and if they had a result the was not expected, he would have called me. -- that was not expected, he would have called me. >> i understand that. you are the senior tool pusher. because of your confidence in mr. anderson, you did not have full visibility of what was going on. he relied on him to make the proper judgment, is that correct? >> that is correct. >> ok, sir. thank you. do you have any questions? >> no questions, thank you. >> thank you. trans ocean? >> i have a couple of questions

-- at least one question. mr. ezell, during these hearings, it has been brought out that the deepwater horizon was being congratulated by bp for a no lost time accident record over 7 years. >> that is correct. >> during this hearing, a lost broughtidneent was ing in questioning involve an mms record -- >> march 6, 2008. >> i have that accident record here. can you look at it and tell me if you have any personal knowledge about that accident?

>> yes, sir. as a matter of fact, i was on account rig when that happened. i was the third-party hand on the boat. >> was that transocean? >> no, sir. >> where did the accident happened? >> it happened on the vessel. a tool rolled on his foot. >> it was a member of a crew on a supply boat. that accident happened on the supply boat. because it was on the bp lease, this accident report would have emanated from that les. >> you are exactly right. >> it shows the reporting person as -- from that lease. >> you are exactly right. >> it shows the reporting person as bp. >> i did not think the grain had

been hoped to anything yet -- the crane had been hooked to anything yet. >> can i read something? they were unloading it using the port crane. who was responsible for that? >> of course, if it was being hoisted, that would be transocean. >> what about their policy statement that says each employee has the responsibility to interrupt an operation to prevent an incident from occurring? >> that is correct. >> who managed the lift? >> the sole responsibility? >> yes, sir. is it not the crane operator? >> you are suggesting that the crane operator caused this. this witness has personal information that it was the

removal of chalk which caused the load to move. >> i'm arguing with what was reported to the mms. >> you are making a statement for the record. i am saying that the fact that the grain may have been used -- crane may have been used does not indicate that it was part of accident. i understand what you're saying, and i hope you understand me. >> he removed the that shot and it rolled onto his foot, prior to -- that chalk and it rolled onto his foot, prior to that. >> why did he removed the stock? -- remove the chalk? >> what would you ask him that? you think he was responsible? >> it was at the rig. >> it is also noted in the report, a contributing cause,

high seas. ok. >> i do not think that is either.an's fault >> are you not concerned with the individuals operating at the site? >> concerning yourselves with the individual does not mean you are responsible for a lost time accident. what does this have to do with what we are investigating? >> you brought it up, sir. and a network, you brought it up. -- >> you brought it up. you wanted to say that the seven years was not technically correct. >> according to us, it is not. >> that has no bearing on this action. >> it has a bearing when we are having three discussions going on with the vip's. lost time accidents have nothing

to do with when the well was being grilled, when they were 43 days behind. -- being drilled, when there were 43 days behind. >> i hope this investigation proceeds in a more relevant way. the irs -- i understand and appreciate you raising this, but this -- >> i understand and appreciate you raising this. >> i want the facts to be accurate. >> sir, i assure you that they are accurate, but they are being questioned. >> all right. >> no, thank you. >> no questions. >> no questions. >> douglas brown?

>> how are you? >> doing good. >> i want to take you back to the meetings that occurred in the early morning hours of the 20th. the first one was around -- the first one occurred around 06:30. >> that is correct,. that was our morning call with the asset and performance rig managers. those are daily meetings. >> are they onshore? >> they are. >> what are their names? >> james kent and paul johnson. >> what was communicated to them or what did they communicate to you? >> there was a whole array of

different topics. there was no particular focus on anything, other than just, give me the oim. what happened during the last twenty-four hours? then, if the captain has anything to speak on, he does. the maintenance supervisor he is in the room. if he has anything to say having to do with maintenance of the equipment, he has his turn to talk to the rig managers. the asset manager -- when he talks, he typically tells us about projects and different things that we're going to do, maybe at the end or the 2011 shipyard. those are the kind of

discussions we have the performance and -- with the performance and asset managers every day. >> was one of the topics -- this was under way the day before the accident? did you keep them informed about what was going on on the rig? >> they were informed. >> it did you tell them what operations were going to take place on the day of the 20th? >> yes, sir, they were aware of the operations. >> when you were in your bunk, watching tv, was it steven curtis that called you? >> that is correct. >> what did he tell you? and he told me, we have as equation. -- >> he told me, we have a situation. the well is coming in, and mud is flowing to the ground.

>> since that time, has anyone told you why the well was coming in? >> i could only assume. >> he will not make any assumptions under oath. >> do you have an opinion? >> i would not care to share in it. -- share it. >> you do not want to share it with the board? >> no, sir. >> thank you. >> thank you, sir. >> no questions. >> halliburton? >> no questions. >> one more question. you've admitted that you did not have full visibility of what was going on. now, the ym, from his testimony, my understanding is

that he was not aware of certain activities also. do you believe that he had full visibility of what was going on during that drilling operation? >> no, sir, i do not think he had full visibility either. >> you do not have full visibility, he does not have full visibility, and the third guy is the company man. if he also does not have full visibility, what is going on? we have a problem, don't you think? >> the question reaches a conclusion, and i did not hear the conclusion. what is the conclusion? but the conclusion is that three senior people -- >> the conclusion is that three senior -- mr. ezell does not have all visibility.

he says that the oim does not have full visibility. if the company man did not have full visibility of what was going on, my conclusion, based on that, is that nobody had full visibility. >> let me know if my reaction. -- note my reaction. the captain of the ship sleeps sometimes and showers sometimes, and he does not have full visibility, because there is a handoff to the appropriate person. there was an operation -- there was no drilling going on. this was a static well. when you say there is full visibility -- or a lack of full visibility, there are a lot of facts in your question. i object appeared without objection, i would like the witness to answer. -- i object. without objection, i would like the witness to answer.

>> that is exactly what i was going to say. [laughter] we have two tool pushers that provide 100% supervision. both of them are highly capable -- or were highly capable -- and if they have any kind of problem, they would have called, and it would have moved to the next level. if i have a problem, i tell you, and everyone will be in the loop. >> i understand, certificatisir. thank you for your testimony. is there any information you think we should be aware of that is relevant to the investigation? >> maybe just a couple of things that i can add. lord, i do not know how to tell you guys this, but that was one of the most painful things we could have ever done -- stay on location and watch the rig burn. those guys that were on there

were our family. it would be like seeing your children or your brothers, or your sisters, perish in that manner. that puts some mental scarring in a lot of people's heads that will never go away. i wish we could have moved away from the location or something. we just had to sit there and review for that many hours. it was extremely painful. the only other thing is -- you have to keep in mind -- the horizon -- i do not care what anybody says -- in my mind, verizon was an exemplary rig with excellent personnel -- the horizon was an exemplary trade with excellent personnel. it won all kinds of awards. those people were not -- they

were not losers, by any means. they paid the ultimate price -- they gave their lives -- to try to minimize the damage that was done to people and property and the environment. i hope that message is clear, that they paid the ultimate price. >> yes, sir, with knowledge that. -- we acknowledge that. we believe their heroic actions saved others. we do not know what the fate of the 11 members were. there was only one person on seeing you had the ability to conduct a search and rescue -- on scene who had the ability to conduct search and rescue. the coast -- the coast guard got there to provide relief.

we wanted to understand that that was testified earlier -- want you to understand that that was testified earlier. >> we were told that was coastguard protocol, but i want to let you know how painful that was. >> yes, sir. thank you for testimony. if we need you to appear again, would you make yourself available? >> yes, sir. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] >> henry clay -- a discussion of him on c-span's "q&a." >> it is stressful for us to select a new justice, because we so admire our new colleagues, we wonder if it will ever be the same.

i have great admiration for the system. the system works. after the appointment of the consummation -- after the appointment and the confirmation process, if there is a confirmation, the system will bring us a very good justice. >> with the confirmation hearings for elena kagan starting soon, learn more about the nation's highest court in c- span's latest book about the supreme court, which provides unique insight about the court. it is available in hardcover and also as an ebook. >> and now drew brees, the quarterback of the champion -- the super bowl champion new orleans saints, addressing the graduates of loyola university. he talks about his decision to move to new orleans after hurricane katrina. this is about 15 minutes.

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summer of 2006 -- that was not the most popular thing to do. for me, i felt like coming to new orleans was appalling. for you, there must have been something drawing you hear -- was a calling. for you, there must have been something wrong you here as well. ed knew that we belong here. four years later, we can reflect back and say we were part of something special. the work is not done yet, but we were part of something special. we have watched the city come back stronger than ever. we have seen the people come back with more passion and determination than before. we have all been part of the super bowl championship. [cheers and applause] definitely could not leave that one out. [applause]

no matter where you are from or where you go from here, keep new orleans close to your heart. remember what you were a part of, and know that we are all now linked together forever. [cheers and applause] as i looked out at the young men and women graduates of loyola university, class of 2010, i am so excited for you all. what you are about to experience will be i opening, certainly rewarding -- eye-opening, certainly rewarding, and challenging at times. experience is gained when you do not get what you want. i can promise you that you will gain experience. you will not always get what you want. you will face of adversity.

this guy is a limit as to what you can accomplish -- the sky is the limit as to what you can accomplish. some of you will be doctors, lawyers, politicians come writers -- politicians, writers, artists, teachers, coaches, entrepreneurs, inventors, and maybe one of you will even own an nfl franchise someday. i know another loyola university member who does. [laughter] [applause] i can tell you this -- your best years are yet to come, but that does not mean it is going to be easy. i can guarantee you that he will face of adversity along the way. for most of you -- that you will face adversity along the way. for most of you, it will be the toughest thing you have had to

face in your life. every person that you meet will say it is because of that adversity that they have the opportunity to reach new heights that they never thought possible. for me, it was my shoulder injury in 2005, december 31. i was playing for the san diego chargers and i dislocated my right shoulder going into the off season in which i did not have a contract. i did not have a job. when you have the kind of injury as a quarterback, there are not many people who come calling or knocking. at the time, i thought it was probably the worst thing that could have ever happened to me. but now, i look back at four years later, and i say it was probably one of the best things that ever happened to me. [applause] because it brought me to new orleans.

there are many others that have faced that adversity and been in similar circumstances and situations. steve jobs -- c zero of -- ceo of apple. you might know him. he was adopted as a young baby. he went to college and dropped out after his first year. he ended up then starting apple, along with a partner of his, when he was 20-years-old, in his basement. by age 30, he was fired from his position as ceo, when he had a falling out with his partner and with the board at apple. for the next few years, there was some soul-searching for him, but in the end, she ended up starting up another company -- he ended up starting up another

company which you might have which of -- pixaar -- ended up getting bought out by disney for $8 billion. he was right back where he was 20 years before as ceo. he is now doing some remarkable things. it was that adversity, when he was kicked to the curb, so to speak, from the company that he founded, where he really gain strength and even more motivation to go forth and the remarkable things that he would not have been able to accomplish at the not gone through what he went through at age 30 -- that he would not have been able to accomplish, had he not gone through what he went through at age 30. another example -- ellen degeneres.

i have heard her talk about the moment when she came out and announced she was gay. at that point, she was having a pretty successful career. [laughter] little slip. [applause] she was having a pretty successful. [laughter] once she announced that, she, for three years, was out of work. people would not give her the opportunities that they had before. to her, that was the toughest thing she ever had to go through. but in the end, she was being true to herself. and she then received a small opportunity to host her own tv

show -- her own talk show. and i think we all know how that has gone. she is perhaps one of the most, if not the most, successful talk show hosts in the history. by being an new orleans woman, we know what she has meant to the country, to the world. she is a source of inspiration. had she not gone through what she went through during those three years, she would not be where she is today. once again, the lesson being that adversity is an opportunity. adversity will make you stronger. adversity will shape you into the person you are meant to be. you probably remember the onside kick in the the super bowl -- in the super bowl. [applause]

how could we forget that? i will tell you the story behind that. we had two weeks to prepare for the super bowl. he came into the meeting and said, we have an onside kick that we're putting in the plan, and is not a matter of if, but when. it is going to happen. sure enough, it did. and it worked. thank god. [laughter] so the lesson there -- it is not a matter of if you will face adversity in your life, but when. when adversity knocks on your door, seize it as an opportunity. it is god's way of providing you with the strength and the tools to face future challenges and to mold you into the person that he

meant for you to be. in the end, it is this adversity that will allow you to accomplish things in life that you originally thought were reserved only for your dreams. my second piece of advice to you is this -- find what you love to do and then figure out a way to get paid for it. [laughter] it sounds pretty simple, does it not? find what you love to do and then figure out a way to get paid for it. some of you think you know exactly what you want to do. there are others who probably have no idea. i can tell you this -- that is ok. in a year from now, those that think they know what they want to do, they might not have any idea. those that do not know what to do may have found their passion by then. my point is, be patient and don't settle.

the only way to do great work is to love what you do. as with every matter of the heart, you will know when you find. -- find it. my third piece of advice is to approach every opportunity with an attitude of gratitude and a mindset that whenever you encounter, you will leave it better -- whatever you encounter, you will leave it better than when you arrived. we have all been part of that here in new orleans. in everything you do in life, leave your mark. be a great stir word of the community and society and whatever business -- a great community the and society and would never -- and whatever business you're involved in. life goes fast. i was in your seats ten yeaers

ago-- ten years ago. it feels like it was yesterday. my point there is, do not forget to enjoy the moment and reflect back on the journey from time to time. for me, standing on the podium after we won the super bowl was a moment -- one of the defining moments of my life. what made it even more special was the fact that i was holding my son. and the reflection on everything that we had been through as a city, as a team, to get to that pionoint. as we watched the confetti comedown and "world champions" come across the jumbotron and

looking at the who dat nation going crazy, we recognized what a journey that had been and how special it was. there is no city, no organization, no group of people that deserve it more. i promise you that. [applause] but the journey is not over. we want another one. [applause] also, do not forget to enjoy the little things in life. sometimes you get going so fast. i feel like the last three months have been like that for me. do not forget to enjoy the little things in life. watching the sunset with the woman you love. taking a walk in the park.

sitting in rocking chairs on the front porch, watching the street cars go by. throwing the ball with your child. you will work too hard to not enjoy those little things. so enjoy the little things. my last piece of advice is, do not forget why you were put on this earth. the mayor mentioned this earlier. we were put on this earth to serve others. sometimes, the more successful that you get, people tend to forget that. it becomes more about how they can serve you, as opposed to how you can serve others. do not forget, no matter how successful you become -- which you all will -- to serve others. i believe everyone can agree that we have all been blessed with some great opportunities in

our lives. the appreciative and respectful of those opportunities -- be appreciative and respectful of those opportunities and not take them for granted. give back what has been given to you. take the time to make the difference in the life of somebody less fortunate. it is amazing that the more generous you are and the more you choose to serve others, the happier you will be. and now, for the words you have been waiting for, in closing - - [laughter] i would like to leave you with a quote. we are going to finished strong, do not worry. [cheers and applause] we cannot know and the other way. i want to leave you with a quote. i could have chosen any quote,

but i am choosing one from my grandfather. he is 85 years old and he still lives on the ranch, herding cows. i heard this all the time from them when i was growing up -- him when i was growing up. there are three types of people in the world -- those that make it happen, those that watch it happen, and those that wake up and say, what the heck happened? [laughter] which one are you? that is what he would tell me. i leave you today by first saying, congratulations to the 2010 graduating class of the royal university -- of loyola university. [applause] and now, let's go make it happen.

[cheers and applause] >> and now lucy beckham, at the college of charleston graduate school commencement. she is a high school principal in south carolina. she discusses the value of education. this is about 10 minutes. >> when one asks what makes a school great, the obvious answer is the commitment and hard work of the stakeholders. we of some of the best teachers, parents, -- we have a some of the best teachers, parents, and

students in the country. the funny thing for me is that, when i began my career, i had no ambitions to be the national principle of the year. i did not plan to be a principal at all. i was excited about being a teacher. i thought one of the board members sitting here to my right -- taught one of the board members sitting here to my right. she did write well back then. -- right well back then. i was pleased to have my experience here. the principal there offered me a job as a math teacher. he asked me if there was any math subject i would prefer not to teach. i said, yes, father, geometry. you can imagine my surprise when the only subject was geometry every period. i had to study geometry books. i got help from experienced math

teachers, including my own dear mother, and i tried to turn myself into a good geometry teacher. i faced a different challenge the next year. father kelly told me my schedule would be all geometry and one algebra 1. that class met at the freshman building. it was about eight blocks away by car. both buildings were on the same schedule. each day, after teaching a section of geometry, during the class exchange, i would run down three flights of stairs, to the parking lot, to my car, and drive down the street as fast as i could without getting a ticket, into the other building, top two flights of stairs, into the classroom, pick up my chalk and begin. i was young, thin, and in great shape. that was what was best for the kids.

they needed a math teacher and that principle thought i could handle it the best. i learned some important lessons that helped me through the rest of my career. i've learned that persistence and determination and flexibility are critical for success in any field, but especially in education. that has never been truer than it is today, as we face what is the real crisis in our country's public education system. for the next few minutes, i would like to talk to you about this crisis and what all of us can do to help. on the state and national level, we have far too many elected officials and citizens who seem to have a "what's in it for me" attitude about our public schools. -- for me" attitude about our public schools. some of them seem to be blinded by self-interest, or they are under the interest of special interest groups.

they fail to see the connection between a strong system of public education and the future of america as a whole. they are focusing on what is going wrong, and ignoring the many successes. this type of thinking is at best misguided, and at worst it endangers the security and prosperity of our country. when people say the children are our future, it is the truth. children across this nation, from all sorts of backgrounds and circumstances -- the quality of their education and opportunities available to them should not be limited by their race, their family income, or there's a code -- their zip code. five years ago, i was the mentor for a young man who led been raised in generational poverty. his principal called to ask me to look out for him. he said he was a quiet kid, but one of the brightest in his

class. keep abreast of the story. he lived in a small, -- he told me the rest of the story. he lived in a small, dilapidated home on the edge of town. the family had no car and no access to public transportation. his dad was dead. his mom never came to a meeting because she had no way to get there. doing homework was not an option. there was no quiet place to study and barely a place to sleep. he had missed the basic social experience that we all take for granted. going out to a restaurant and ordering from a menu, taking a car trip with a family. i learned more about the issues of poverty and social class and their impact on children from my relationship with michael than i ever did in any course or seminar. although he was intelligent, the obstacles he faced were massive. he did that -- he did graduate from high school last year.

it was a great day. he was the first member of his family to do so. he quickly found that having a high school diploma is not enough. after five months of looking for a job, to no avail, while attending community college, he opted to enter the u.s. army and hopes to go to college later. he understands that, to compete for good jobs in the world today, he must have post secondary education. that is the new reality for every high school student in america. had it not been for the teachers who were willing to tutor and nurture and encourage him, michael, today, would be another dropout. as a nation, we cannot afford to fail the children like michael who desperately need a good education to break the cycle of property -- poverty. providing adequate and stable funding for our schools is a national crisis, a problem in every state. cutting instructional days and

letting our teachers go, canceling the arts and athletics programs that are being considered now -- these are awful ideas. [applause] if that is where we end up, then we will have failed these children and not given them the quality of education and opportunities that they need and deserve. please understand that america's economic forecast is dependent upon the quality and the skill of the work force. we're always only one generation away from a bright future or a great decline. on a trip to washington last fall, i visited the home of thomas jefferson. he was one of the visionary founding fathers of this nation, and the principal author of the declaration of independence. his writings make it clear that

he envisioned a strong system of public education as being critical to the success of this country. describe the system of education which would serve every citizen, richest and poorest -- he described a system of education which would serve every citizen, richest and poorest. he believed having an educated citizenry was required for the preservation of our liberty. this crisis is simple and the solution is simple. each of us and every citizen in america passed to actively seek ways that we can do our part to support our country by supporting public education. we all had a role to play. those of you who are entering the education field will have the privilege of molding future americans. decide that you will always do what is best for your students, even if it is difficult for you personally. choose to have a positive

attitude, regardless of how many flights of stairs you may be asked to run, or if your teacher at the site and -- teaching at a summit is not what you wanted. be a blessing -- teaching assignment is not what you wanted. be a blessing. remember, teaching is a calling. it is missionary work. you have an opportunity to impact lives. be the teacher that you remember to your students. for those of you who do not plan to enter the education field, please do not think you are off the hook. .

today the first hellish recipient will be graduating. will you please stand now and recognized in honor of your contribution to education. [applause] on behalf of the children, i want to thank you. you make a huge difference. finally, there is another way that all of you can contribute.

that is by letting your voice be heard. speak up for our schools. learn about the candidates running for office. choose those who support public education. most of them say they do. votes in every election. let me say that again. but in every election. be an advocate always for the children. we're so blessed to live here in this great country. we endanger our liberty and prosperity without a strong system of public education for all of our children. please go out and do your part to make a difference for those children. god bless you, graduates, as you take on new roles in our society. god bless your families and friends who are here today and who have helped get you to this point. god bless america. thank you.

[applause] >> and now michelle bachelet, the president of chile. she discusses foreign service and your country's relations with the u.s.. from washington, this is 15 minutes. >> dean goodman and the class of a 2010 and all of your family, thank you, mr. president, for your kind words. please send me because i might need them now that i am looking for work. i wish to thank of the american university for this incredible honor.

you have bestowed an honorary doctorate upon me. i am honored and i speak on behalf of the the millions of countryman and countrywoman. our people have struggled to rebuild a democracy and we are so proud. the people of today struggled after one of the most destructive earthquakes in recent history. throughout chilean history, we have overcome challenges. allow me to and read my appreciation because this university that includes chilean students, professors, and the dean had been involved with the struggle for and strengthening of democracy and human rights in chile and all over the world. i am pleased to learn you have recently established a center for latino americans which will

undoubtedly be a catalyst for deeply intellectual collaborations between your academy, community, and ours. i am proud to accompany you in the joys and happiness of this ceremony. i want to extend my special congratulations to all the students who are graduating today. that may extend congratulations to your parents and families. graduates, please join me in expressing your support for your friends and family. [applause] graduating from college is a bit like leaving the presidency. you look back and reflect with pride on the hard work and the things you have accomplished. the most valuable lesson lies in what you have learned about yourself.

you have the ability to work through the night and still be in top form tomorrow. leaving college, you like me, look forward to the future with optimism that you are not sure what that future holds. some of you may seek employment, some that may go on to continue your studies. remember that the past you choose today will help guide your future but it will not determine it. when will help you reach your goal is hard work, perseverance, and a bit of luck. in my case, life has taken many unexpected turns. i studied resident -- i studied medicine and became president. when the nicest has been able to share this milestone in your life. for this, i think you. graduates coming have earned your degrees and deserve a

celebration. that is the good news. the bad news is that now comes the hard part because you have been given the tools and now is the time to go out and change the world. it is a world that expects much from you.3 regional challenges, economic crisis around ago, and a few difficulties in america. the financial crisis is the worst in the last 60 years and has a serious effect and is starting to recover. we must ask ourselves what we have learned from this crisis. first, the crisis was a result of an extended absence of international political leadership. we lack the will to act on the many problems as globalization

was expanding. it has been ignored for so long. the international economic crisis than we have endured since 2008 has become an example of the cost of globalization without rules. they believed it could be managed with a laissez-faire attitude and that the market would replace policy. we must learn this lesson. if we do not, humanity will face much larger problems in the future with many other baubles that will burst. the best example is global warming. the main challenge for the international community is to learn to help the global problem. as a result, we need to design a global social and political contract based on a new political paradigm whose aim is

a collective action carried out five strong states capable of generating comprehensive relations that are sure and governance for the 21st century. that means one thing. must take multilateralism seriously. we cannot continue things as we have before. we must go ahead with the task that has been proposed. it points toward the viable path for improving this. we must coordinate fiscal policies and avoid imbalances. we must strengthen relations in order to avoid another global financial crisis. we must reform multilateral institutions. if we do not do this together, they will not be able to do and alone. the international community is moving in this direction, but the truth is that we are only at the beginning. you may wonder why a former president of chile is so

concerned with this. first of all, everything is connected and we are all connected. the fact is that the tension between the paradigm of deregulation and the need to generate the regulations to ensure an ability has been a recurring theme in our democracies around our region. during the 1980's and 1990's, they flourished. many thought that democracy was here to stay. since then, we have observed how many doctors' fees have been unable to generate as expected. democracy faces a problem. democracies from the 1980's and 1990's have been lost in a world recession. let america has not been immune

to this global phenomenon. on the one hand, this is the longest democratic stance in history. during the last 25 years, there have been 20 interruptions of the legitimately elected governments. until honduras, we have not seen a situation like this since the cold war. the more reason democratic interruption [inaudible] defending the mark receive and searching for dialogue to solve political crisis is much better than when generation ago. take for example the response of the union of south american nations, the 12 countries of south america, as we try to avoid a breakdown of democracy

during the crisis of 2008 or during the crisis in honduras. even so, the organization of democracy in latin america requires much more. it requires an understanding that democratic rules are totally and absolutely essential but they are not enough. we must pay attention to what the people think, how they experience of democracy, and what we can get from it. they never forget what others sometimes fail to remember. abraham lincoln reminded us 150 years ago that democracy is the government of the people but it also must be by the people and for the people. this requires the socialization of organizations. without a doubt, civil liberties and respect for human rights are the essence of democracy.

guarantees for an individual for freedom of thought, religion, of the press, and association must be respected and also the freedom to live without fear. although in the entire continent, we respect civil rights and individual guarantees. in many places, there is the pressure from organized crime. this is why if we wish to consolidate and improve democracy, we must also defeat organized crime, corruption, inefficient judicial systems. when he spoke at this university, the american university, almost 50 years ago, and i will quote, "where ever we are, we must all in our daily lives live up to the age-old faith that peace and freedom of

together. in too many of our cities and today, the piece is not to cure it is -- because freedom is not secure." let us bolster the freedoms. once we are sure to move forward to creating a format for public participation and citizen involvement. even if this means less power, which traditionally has been so powerful in america, let us not be afraid of giving up power because in reality we are not giving it up but we are giving it back. public apathy and the eroding democracies. public input and participation results in more efficient public policies. keeping in mind that democracy is the government for the people, let us ensure that democracy provide citizens with basic social needs.

especially in latin america where the social dimension was not given the same thoughts that the modernization had. as a result, in many cases, we ended up eroding those democracies that we worked so hard to rebuild. during that time, the region's microeconomic management did improve creating a six year period of economic growth and bringing 37 million land americans out of property. that improvement has not been insufficient but it has stopped altogether. this was due to the international economic crisis. as a result, we run the risk of debilitating. recent numbers are alarming. it has increased to 62 million people.

in 2009, the number of unemployed people in increased 3.9 million from the previous year. this is why today with all of the energy, and democracy that makes sense with and not just a privileged few. we cannot afford to keep waiting for a society that enjoys civil liberties, equal rights, and equal opportunities. we need to go beyond handouts for the poor and towards the more universal and caring scheme of the modern welfare state. this requires a great deal of political. it requires sitting in the good times to have something to fall back on. that is what we did. insuring social rights over time and not having conditions like

today. this is not easy. it is even harder in times of crisis. the challenges are formidable but not insurmountable. many countries have shown that it can be done and we are one of them. we reduced poverty from 40% to 13.7% between 1990 and 2006. when the prices -- with the price of copper was high when it was most needed, we were able to increase social standing by seven. % -- by 7.8%. we did have a fiscal stimulus plan to help increase jobs. what this shows is that one can -pbe popular without being [unintelligible] [applause]

it is possible to ensure minimum standards of welfare for our people so that democracy remains alive in our continent. as the democracy can improve standards of living, it may not happen right away but gradually and noticeably changes to a court in the degree that keeps the hope for democracy alive. my friends of the american university, let me conclude with a call for optimism of the future of latin america and the relationship between our region and the united states. despite all of its difficulties, latin america has began to quickly overcome the crisis. we have to continue good macroeconomic management. there is a growing conviction that counter it -- cyclical policies are possible. this is being carried out with very few exceptions by democracies. imperfect as they all are, but

democracies nevertheless. during our seven regional meetings, we have reports of building dialogue and understanding. wherever possible, we reach agreements on those issues. i have no doubt that this role is not only desirable but viable. this year, as many of us celebrate the bicentennial of our independence, but americans want to embark and this road together, and that america building on those 200 years of friendship that stretches, "from the piece of the buffalo for the pommel the sounds of land's and and the story of antarctic lights." thank you very much and congratulations again to the class of chita's intend. congratulations. [applause]

>> and now indiana state university. she talks about her background in credits the faculty for her success. from indiana, this is five minutes. >> before i came to indiana state university, nothing in my life was going right. i was a mess personally and financially. alcohol was a problem for my dad that i wanted to fix. i could not fix it. instead i became an angry, rebellious, and find it teenager who would listen to no one. i was eventually kicked out of school and arrested and labeled a juvenile delinquent. as a child with a criminal record, i had nowhere to turn. indiana state university has been the rock of my life.

coming here not only changed my life and set me on a path, but it saved me from a life of destruction. i was uncertain which way to go in august 2005. one direction was to enroll at ise new -- at indiana state. it was special. my acceptance resulted in love and an abundance of resources including faculty and administrators who care for students in their need. as a first-generation college student, indiana state has become my safe haven, my place of restoration. it is not located in the fanciest city, nor is it perfect, but the environment of indiana state and the people surrounding it have allowed me to grow as well as find peace and shelter.

the university has provided me with mentors, resources, leaders, and teachers all of whom have inspired me. because of indiana state, but we, the class of 2010 graduating seniors, are confident in our professional choices. we have learned of leadership skills from serving in a variety of traditions. our experiences have provided us with the ability to master or tackle any challenges of life. our dreams and goals incorporate the many blessings, teachings, and life lessons we have experienced at indiana state. i also know that i am qualified and prepared for a life of service. for example, for my work in college, i have been able to found and serve as the director of my own nonprofit organization, the lamb, gorgeous ladies acting maturely. -- glam, gorgeous ladies acting

maturely. indiana state has befriended me and other students with professional and life services to be able to do research, explore and steady policy, and influence social change. through the indian state study abroad program, i was able to travel to guadalajara, mexico. the opportunity provided to me by the internship i had with the office of the mayor of indianapolis and the county prosecutor's have me ready for my next phase of life. the social life at indiana state has been exceptional. even though i originally thought i was too old for the collegiate experience, as students we have had the luxury of hearing guest speakers, attend conferences of world leaders, and network with influential people. many of us attended discussions

and summits that created change. furthermore, my involvement with organizations and programs with scholars as well as my career experiences proves just how much indian state has done for me and all of the student body. my fellow peers and senior graduating class rates, thank you for walking me to the top. thank you for your ambition, motivation, as well as perseverance. you are the reason that i have learned and enjoyed my relationship in my time spent at indiana state. thank you for being creators and innovators. you have stories of your own about your experiences and opportunities at indiana state. because of your love and support, we all live as leaders, entrepreneurs come and inventors of change.

on the behalf of the class of 2010 graduates and as a member of the sycamore ambassadors group, i want to say thank you to indiana state. i am a true blue sycamore standing with pride leaving a legacy for those who follow. we love life. thank you for providing us with many opportunities. most importantly, but we want to thank you for the knowledge to be all that we can be. thank you for giving us more from day one. most importantly, thank you to all of the professors, teachers, administrators who have opened their hearts to help us learn and achieve more. thank you for your patience and your willingness to always give more. thank you to all your supporters, donors, and alumni who have paved the way and set the stage for myself and my

fellow graduates. thank you, indiana state university, for educating men and women who are now qualified , certified, prepared to save lives, intellectually driven, and ready to conquer the world. stay blue, indiana state true. thank you. [applause] >> and now robert eggerm, the founder of the washington, d.c., a central kitchen. they serve about 4500 meals a day. he speaks to the students about the importance of community service. from gettysburg, pa., this is 15 minutes. >> alumni, board of trustees, faculty, and the class of a

thousand 10 -- 2010 -- [applause] it is an honor to speak with you today. this is an alpha omega a moment. i was lucky enough to speak to the students when they first came here as freshmen. i have gotten to know so many of them over the years. people have asked, and i think many assume, that the subject of my speech today given the work i have done in my relationship with the school will be in the nature of asking the students to give back. i will be honest with you. that is the last thing i will do. if i may explain why. one last pop quiz. class of 2010, before you got here, a show of hands, how many of you had done community service? look at this, america. but at this. rigid look at this.

[applause] this is not a getting back generation. this is a very different generation. class of 2010, you were at the forefront of america toxic first-generation ever, 60 million strong, young men and women born between 1985 and 2000, you are at the forefront of a very new era in america. your generation has been raised doing community service. whether this was going on mission trips, pushing grain policies, demanding fairer trade coffee, wearing toms, launching social enterprises, supporting micro credit, rallying for equal rights, you have, since the day you walked through the school, been redefining the concept of what it means to "do good work." you did not need an instruction

manual. if you set out to rewrite the rules of what it takes to do good work. the debt when you have created some to a arrived. with countless acts by individuals, whether organized by your amazing sororities and fraternities, the black student union, countless other groups, you all have completely razed of the war on what it means to be graduating class from gettysburg college. -- you all have completely raised the bar on what it means to beat a graduating class. you plan and gardens at the farmhouse over on carlisle. you did service trips to help rebuild the gulf. he worked side by side with residence on the indian reservation as well as citizens gettysburg's sister city in nicaragua. if i may be so bold -- through

the campus kitchen, my favorite of all. you have delivered 10,000 meals to people in the adams county. you deserve an amazing round of applause for what you have done. [applause] if i may take a moment of personal pride, i would like to of knowledge professor chris vee who for so many years -- stand- up, chris. [applause] he has been leading freshman down to volunteer at my kitchen. i would like to acknowledge someone from the class of 2008. there you go. as well as cathy, melissa, and megan who were the relationship team and toward this campus up. -- tore this campus up. [applause]

not since world war ii has a generation answer the call to service in the numbers that just -- that this generation. the stakes have not been as high for them personally, but the stakes for our country have never been as high. someone called you -- would call you generation next." from where i stand having worked side-by-side with many of you coming you are "a generation now." this world needs you now. q. are the first of regeneration to hit the beach head, a national more midi. behind you are millions, millions coming your younger brothers and sisters who are looking to you to break new ground, to go where others have not. they are looking for the same things you are down the road, a bright future and a good job.

some of you harbored dreams of attaining great individual wealth, others helping to spur social movements. my advice to you today, many people think this is mulch -- mutually exclusive. you can do both, there i say you must. if i may be bold enough to generalize, you are a generation that seems hellbent on merging spirituality, lifestyle, and in come, saying, i do not want to choose, i want to do both. nonetheless, you want to make a living, and that is important. this is a tough world you are going out into. you need to find a job that allows you to do that. reality is that there is something new out there and you have been exploring this step by step, this new hybrid business, this notion that you, again, can do good and make wealth at the same time. in too many of our graduation across america what we are

asking of your generation is to choose, saying after spending 10 years in your life doing community service in the school after school, commencement address after address, speakers are always saying, "today you must choose -- do you want to be a .com or .org"? defy that. boldly go forward with the idea that you can be both. that is what our country needs. it is every generations right to redraw the map, to rearrange the order of things and create new rules. that is what people are dying to preserve as we speak. that is why people come to these battlefields to commemorate. it is what makes america, even today, the greatest, richest, freest country in the world. each generation has the freedom,

opportunity, and obligation to do better. the boulder, run further, and push harder. -- be bolder, run further, push harder. during the freedom of like you with a two dollar -- $2 drink special. lift up your crunk cup and guzzle every drop down. light this country up. [cheers and applause] our country needs your impossible dreams, born of the exhilarating balance and optimism on display today. hold on to those dreams. never let them go. on them and make the spirit of

now you're generation's banner, your matter out -- your model, your creed. step forward together, today into your future. brothers and sisters, this will not be easy. the reality is when i started the central kitchen, i did not want to do it. i was a volunteer to try to get the other people to do it. i wanted to run and nightclub. sometimes you run into a wall where the path splits. sometimes you need to take that leap of faith. i will we all cannot be amazing athletes like karen epstein. she is one of those women who runs far. most of us need running buddies. that is what i would like to wrap things up with. people oftentimes come to the valley and they think about the civil war. they do not realize that long before this was a conduit for

the underground railroad. people can looking for a safe harbor overnight whether they were on their way north to freedom. what is often times forgotten about the overnight railroad is it the secret password. when you were looking for a safe word, the safe place, it is a friend with friends. that is what i would like to close with today. you will never go further with a friend by your side. -- without a dave -- withourt a friend by your side. the friends you wrote your bicycles with, through the baseball with, those young men that when this day seems 1 million miles away, think of them. some he may not have seen in a long time, reach back out with them and reconnect. let them know how important they are to you. the frenzy made in this class

are some of the best friends you have to run your entire life -- the friends you made in this class will be some of the best you will have in your entire life. all of these things dissipate if you do not work at them and nurture your friendships. while it is important to send facebook updates, happy birthday, nothing takes the place of a simple note. i am thinking of you. you are important to me. there'll be times in your life where you run into a wall and people who know what you will save the world. you know those -- you will need those friendships to help steel yourself for the inevitable disappointment and the courage it will take to really search for word and not give up on those dreams. let me reemphasized -- american need you to hold on to the optimism, this glorious optimism of youth. never ever let it go. do not think you need to trade that for a paycheck, brothers

and sisters. you can have both. that is that the country has always been about. every generation gets a chance to go out and redefine the rules. that is your birthright. you do not have to accept the world as you at -- as you inherit it today. set your sights on changing the the rules, make new rules, redraw the lines. you do not have to go out and think, "i have to give back." realize you can do this every single day. that is really the important message and would like to leave with you today, that notion that america needs to move beyond the notion that we can give back our way out of the situations. i am part of a generation that is getting older every day. 10,000 people turned 60 every single day in america. he would not be wrong. i will tell you, in all honesty,

we need you all to redefine the whole concept of what it means to live a good life, what it means to be a gettysburg graduate. today, brothers and sisters, go forth, be daring, be brave, be respectful of convention, the impatient with process, be friends with friends. as conan said, "burkhart and be kind." -- "work hard and be kind." when you make it big, tell jon stewart he can kiss your diploma. [cheers and applause] never stop believing. the lot, class of 2010, and rock the world. [applause]

>> vice-president joe biden gives the commencement address to the naval academy in annapolis, maryland. he praised them for their character and integrity and paid tribute to the 11 female graduates when they will be able to serve on submarines. >> admiral fowler, admiral, lieutenant-general, i see the glint in your eyes looking at all of those uniforms. marine one flew over and said, "tell them we are waiting for them." i just want you to know, undersecretary, just to give you one piece of advice might be careful of your language in front of a microphone. [applause]

thank god my mother had passed. i would be one dead joe. [laughter] you all think i am kidding. i am not. [laughter] ladies and gentleman, i was a pretty good football player in 1960 at the university of delaware. i applied to come to this great academy and they considered me. i thought i was going to be a pretty good ball player. i found out you had two days in the backfield and i realized i would not get a chance to play at all. you had a guy named staubach. i went to delaware. ladies and gentleman, you also

by the secretary of the navy, george bancroft, chose this site for the naval academy. it was because of seclusion. it was supposed to rescue the midshipmen from the temptations and distractions of the bigger cities. he did not know armadillos or o'brien's would be hanging around here. [cheers and applause] i do not think he would pick the spot if he knew what annapolis look like today. for the few of you, like me, who may be, as a consequence of the temptations, had engaged in minor disciplinary infractions i have never let that get in the way of talent.

just as to me, john mccain, or a bunch of us. in keeping with the longstanding tradition, this is one of the two reasons i wanted to come here and give this commencement. i like to forgive minor infractions. therefore, in a longstanding tradition, i hereby absolving all midshipmen who are on restriction for minor conduct offenses as of now. [cheers and applause] i know you hesitated sharing because you thought you might be identified. we are not that. we are not bad guys. look, i must tell you that i am genuinely proud and honored to be here today. this is one of the great, great privileges of being vice president of the united states of america, getting to speak at the commencement of the academy. i must tell you that i am also

very proud, and i mean this sincerely, to be in front of you, as the undersecretary said, so many young women and men who, by the mere fact they chose to come here in the midst of what was happening in the moment, have already demonstrated the strength of character and the infinite promise to possess and the integrity you represent. you all -- there is nothing wrong with me. you all possessed rates that secretary bankrupt new were necessary -- when secretary george bancroft knew were necessary. you possess skills, talents, and capacities that are far beyond anything secretary george bancroft could have thought of

165 years ago. notwithstanding that, you are part of a long continuum. you are writing a new chapter in a long history of the strong tradition of this great naval academy. you are all going to be part of a fraternity that goes back 165 years double bind together like a little i have seen in my experience. no matter how long you serve in uniform, even when you are out of uniform, you will come across the annapolis graduates come to share stories, discuss those four years by the day, and no, know like few others know, that wherever you go there is someone that will have your back even though they do not know you personally. that is an awesome sense of pride and patriotism. it is an awesome sense of pride and patriotism that comes over you all when you sing, "navy blue and gold." it is a feeling she had a right

to share like all of you. -- it is a feeling that few have a right to share. this place is special. you have a special experience that has given you a bond that will last a lifetime. he will be amazed how tight that bond is and how long it will last. there are other bonds. i would argue even deeper bonds, those of surrounding you on either side of the stadium, your mother's, your father's, your grandparents coming your brother's coming your sisters. your girls, your guys, they are the ones responsible for the content of your character. they are the ones that brought you some carry out and 80 on campus when you were not able to leave the yards. they were the ones who walked down the driveway every way to retrieve that cherished letter during your plebe summer knowing

it was the only way to hear your voice and know you were surviving. they were the ones who screamed, "go and 80, beat army" flatter than anything that had ever screamed in their lives -- they are the ones to scream, "go navy, beat army" louder than anything they ever have. they spent the last four years thinking of you with tears in their eyes, prayers in their hearts. for all of that and more, you of them. the united states of america i asked you all to give them a round of applause, a boisterous cheer come to those who have been cheering for you for so long. [cheers and applause] stand up. [cheers and applause]

they are not proud, are they? what a great honor. what a great accomplishment. for four long years now, you have looked forward to this moment. they have looked forward to it as well, to watch you walk across this stage, marines come in aviators, seals, submariners. maybe just a special bit of pride for the families of the 11th, the 11 who will be the first naval academy women who serve on submarines. [cheers and applause] you women sailors are not only making history but like the 55 women who first graduated from

this academy 30 years ago, they were an inspiration to you. i got to appoint some of them as a senator. you live in submariners -- you other than submariners will inspire your daughters and granddaughters in the way they never thought they could before. nothing, nothing is beyond my daughter and granddaughter's -- you have been trained by the very best. you leave here with an outstanding capacity to lead. you almost feel pretty good right now. those semesters of calculus, those 0530 pt's, memorizing menus, thinking why you need to do this, reciting them in town

halls. those are all behind you. you will be surprised how in a strange way they prepared you for what is ahead of you. they are behind you, but they prepare you. you managed to do at all without once losing the commander in chief's trophy. not once. [cheers and applause] as a matter of fact, admiral, that is pretty impressive, man. pretty impressive. to the united states naval academy, class of 2010, i say congratulations and welcome to the marines and welcome to the navy. [cheers and applause] i can imagine no more rewarding a career, and 80 man once said,

and any man who may be asked in this century but he did to make his life worthwhile i think can respond with a good deal of pride and satisfaction, "i served in the united states navy." those words were the words of president john f. kennedy. like him, you will now be able to say in this century with a same degree of pride, "i served in the united states navy." all of you will be able to say you served in the most powerful, best equipped, most prepared navy and marine corps the world has ever seen and that is not a hyperbole. i have watched you in my 17 trips to afghanistan and iraq. a young captain was manning the

post with six others who not only demonstrated and returned fire but was able to explain to me in great depth the history of the two trouble competing -- t wo tribal competing areas. you are prepared in a way that you have to be in the order for us to lead the world. the navy today is truly a global force for good with missions more diverse than ever before. there are 2000 marines in afghanistan. there are 13,000 sailors in iraq and afghanistan. there are 9000 more afloat in the waters of the region. they are fighting pirates in the horn of africa, at drug- traffickers in the waters around south america. station. correa -- stationed near korea,

projecting power. you respond to national disasters and literally save lives at the same time spreading good will and support for america everywhere you go. folks, no graduating class kids to choose the world in which they graduate. every class has its own unique challenges. the class of 1940 looked over the horizon at the looming conflict that killed literally tens of millions of people and laid waste to europe. the class of 1915 -- 1950 soon left the stage and went to war in korea, the first military test of the strategy of containment, one then endured and succeeded from that moment

on. the class of 1916 live in a world -- the class of 1960 were 18,000 nuclear missiles were aimed at the united states of america and over three and a thousand -- 300,000 men and women were ready against the soviet army along the curtain. the class of 1970 went to vietnam to stop communism in the asia and came back to a deeply divided country. past generations, your former colleagues, those who went before you, they faced immense challenges but they met them. they met them for fortitude, unity of purpose, and a national security strategy that brought success. through the marshall plan, we

rebuilt europe with the greatest military, nato, and the strongest economy in the world has ever seen we brought down the wall and made a lot of communist ideology. -- a lie of communist ideology. to the class of 2010, you will face great challenges from the moment you step off the stage. two wars, the threat of weapons of mass destruction in the hands of terrorists, pandemic disease, economic dislocation, and a growing gap between the rich and the poor of the world, ethnic animosities in the field states, a rapidly warming plant, an uncertain supply of energy, food, and water, the spread of radical fundamentalism.

these challenges are real. every generation has faced challenges. just like those who came before you coming you will prevail. also, like those who came before us, we need a strategy to succeed. we have laid out and devised what is required by congress the national security strategy treaty by president obama last week at west point, released yesterday. i would like to talk to you in little bit about that today. our national security strategy is made up of four basic principles to guarantee america's continued ascendancy in the 21st century, to guarantee our security. the first principle of that strategy is that our strength and influence ultimately depends

on our economic prosperity and innovation. president obama made that point last week at west point when he said, "at no time in human history has a nation of diminished economic vitality maintained its military or political primacy." that is why we acted swiftly and boldly for the biggest stimulus package in the history of the nation to create jobs today to create a platform for a new economy of tomorrow with historic investments in renewable energy, transportation networks, research and development, building a piece by piece and the economy that will not only be competitive in the 21st century but that is dominant as we -- as dominant as we were in the 20th. if we do not, all of the special talents and equipment that has

been entrusted to you will be very difficult to maintain. that is why we are modernizing health care to drive down costs. it is not merely about care. it is about controling our budgets so future generations are not paying off a debt of those of us who came before. that is why we are putting an end to the reckless practice and mentality on wall street that nearly brought down our economy. a strong economy is the only foundation upon which we can build a guarantee for our national security. the second principle is to use all the municipalities of our power to allow future administrations to use all of the arrows in their quiver, and

diplomacy, law enforcement, foreign aid, education, business, these are all vital tools that advance our security. just as in the past, your mind, our military capacity, it is absolutely necessary but not in and of itself sufficient to guarantee our security. although we reserve the right to act preemptively, we will strive to stop crises before they start coming to avoid wherever we can the choice of last resort for the danger of inaction. the third principle is that we should follow the example of previous generations and build strong military alliances and effective international

organizations. as i mentioned before, the threats we face from pandemic disease to terrorism, they had no respect to borders. they do not yield to the massive force. to defeat them requires responsible nations, not only to set down the rules of conduct for the 21st century as we did after world ii, but insist that other nations along with us in force enforse those rules of conduct. -- those nations along with lessenfus enforce the rulse of conduct. . .

>> we had a decent respect for the opinions of mankind. so let the world know that we establish a nation where all men are created equal, endowed by their creator with certain inalienable rights. among them, life, liberty, and the pursuit of happiness, and we still hold these truths self- evident, and we act accordingly. that is why ultimately, the vast majority of the world's populations still look to us for consideration, still wishing to

repair to our shores, and that is why we cannot undermine our strengths by compromising those values in the name of security. they are ultimately our security, and abroad struggle against violent extremism, a poet our values makes a stronger. compromising them -- of holy our values makes us stronger. let me state clearly, i reject, we reject, as false the notion that we have to choose between our safety and our ideals. for if we yield on our ideals, they will have already won. our ideals or what defined us. our ideals are what sustain us. our ideals are what make us the

greatest nation in history of mankind, and ultimately, that are a powerful incentive for the world to respond. honor, courage, committent -- these are not only the values instilled in you here at the academy, these are also the values that define the rest of america. i have met literally every world leader who has been on the world stage since 1973, and they have no doubt. i have never met one who has a doubt about who we are as americans. today, having earned the right to walk through the main doors of bancroft for the first time, you will leave the yard and enter a long, distinguished line of naval academy graduates.

chester nimitz, 1905, allen sheppard, class of 1945, jimmy carter, class of 1947, john mccain, class of 1958. he deserves a round of applause. he is a good friend. [applause] and he is a great american. charles bolden, class of 1968. the only question i have is this. who among you today will be mentioned by the graduating speaker in 2050 and 2070? i ask that question with all seriousness. i mean it, for some among you will.

you'll be, those of you who excel beyond all others, continue to be the inspiration for future generations. ladies and gentlemen, let me end where i began, with the founding of this academy some 165 years ago. in 1845, the yard consisted of 10 acres of land. it was a home to 55 midshipmen. today, a brigade of 4000 midshipmen roam these glorious 338 acres. 76,000 warriors and heroes have walked across this or a similar stage, grabbed their diplomas, and marched off to defend their nation. you are bound to these men and women as sure as if they work your flesh and blood, as surely as had that been your ball

makes. your experiences are -- as surely as if they had been your bunkmates. the commitment to your country and to your shipmates, a commitment embodied by a man who earned a silver star, bronze star, two purple hearts, a warrior by anyone's definition. the graduated from this academy in 1995. he eventually went to iraq, where he was named the lion of fallujah in 2004. during that operation, he was a young lance corporal who was wounded by a mortar and received a purple heart. the major was drawn to this

young marine. he could barely speak english. he had just received his green card, yet he put his life on the line for the country he had adopted. the major learned that this young lance corporal had a dream to follow in his father's footsteps. his father was a graduate of the vietnamese national military academy and had fought alongside us in vietnam. that young man wanted to attend a military academy and found inspiration in listening to the major's stories about his beloved annapolis. sadly, three years ago, the major lost his life during his fourth tour in iraq when he was killed by small arms fire while leading iraqi troops that he had helped train. i am absolutely certain that the lion of falujah is looking down

right now with immense pride at that former young lance corporal, who is about to have his lieutenant bars pinned on him and is about to receive the award as the marine with the heart of a warrior and the spirit of success. that young lance corporal will realize his dream today as he walks across this stage. [applause] as he walks across the stage to be commissioned as an officer in the united states marine corps. that is a story of honor,

courage, and commitment. that is a story that represents all this academy is about, all that stands for. let me leave you with advice that only a graduate of this prestigious academy has the right to offer. it comes from the personal writings of doug zembec. he wrote, be a man of principle. fight for what you believe in. keep your word. live with integrity. be brave. believe in something bigger than yourself, and serve your country, a teacher, mentor, give something back to society. lead from the front, and you can, for your fears. ladies and gentlemen, to me, that is what makes you midshipmen. that is the definition of who you are and who you will be. that is why i know with absolute

certainty, after serving in high public office for over 37 years, that our country will reach strong -- will be strong for generations to come. so congratulations to you all. your future is literally america's future. make a brave. thank you. may god bless america, and may god bless the united states navy and marine corps, and they got protect our troops around the world. god bless you all. [applause] >> in the parlance of today, he

was a rock star. >> sunday, "q&a". >> tomorrow night on c-span, the state opening of british parliament. following the may 6 british election, the new prime minister and conservative leader david cameron formed a coalition with liberal democrats. officially opening the new parliament, queen elizabeth delivered a speech which outlined the priorities for the coming year. that is sunday night at 9 eastern on c-span. >> house financial-services committee chair barney frank talked about the senate financial regulations build big congress is preparing for a conference committee on the measure. chairman frank made these remarks at an event hosted by

the initial compliance officers conference. >> i am going to dispense with any housekeeping details and jump right into introducing our first keynote speaker of today. he really does not need much introduction. he is congressman barney frank, chairman of the house financial services committee. barney has been representing suburban boston since 1981, and has been chairman of the potential services committee since 2007. in that time, he has been working on all sorts of financial legislation that is very important to this audience, including mortgage industry reform, housing and finance industry reform, credit card reform, but most importantly to us here today would be reform of the regulation of the financial sector. the house passed its bill to reform regulation in december, and the senate finally just past 1 last week. they are never going to start reconciling those two bills and get some final legislation passed within the next few weeks or so that should have some

profound implications for everybody in this room. we are very lucky to have congressman frank here. he is going to talk for 10 or 50 minutes and then open up to questions from audience. i expect a lot of them. without any further ado, congressman frank. [applause] >> thank you for cutting down the introduction. i have never much cared where a speaker went to school. i have one continuing regret, and i do not want to single you out. once before i retire, i would like to be introduced with further ado, because i have a burning desire to see what further ado looks like, and i am hoping someone will satisfy me.

i will speak briefly and open it up for questions. first, it is very important for the financial industry to get some stability. what that means is that we should be moving quickly. we were held up by the health care bill. the senate in particular was delayed by the health care bill. for those arsenical about american politics and think that only big money works -- for those who are cynical, this bill is a defining counterexample. last year when we were doing the bill in the house, we were overshadowed by the health care bill. the deliberations and house were very much an inside game, those who have a direct financial interest had a major role. there were some issues where i had hoped the public might come into play, and the media was not focusing on it, and the public cannot obviously get into this without the media focus.

when the bill went to the senate, the assumption was that my colleague, senator dodd, was going to have to make a compromise with republicans to be able to get 60 votes he needed to break a filibuster. we assumed that the senate would water down some aspects of the bill. exactly the opposite happened. the reason is very simple. i saw this coming in part, but i underestimated the degree to which it would be transformed. the public was paying attention. i lost a couple of votes that i was involved in on the floor of the house, in the area of derivatives regulation that i would have won if we had done in

this year, because my colleagues would have been feeling that public pressure. the bills were still very close. it is rare that two major bills coming out of the house and senate of a similar scope. we should be able to get the bill to the president to sign before the for the july recess. that is important, because stability in the economy is important. it is important for businesses to know what the rules are. i was not surprised to see over the weekend a story in which the business community said it was not as bad as we thought. there's a tendency on the part of some businessmen to think that we are really very stupid. when we do not behave stupidly, would get extra points. it is a very low bar, but i will take it. [laughter] the bill will pass. in fact, if you want to see the outlines of much of the bill, go back to march of 2008, with a

speech given by henry paulson. he talked about -- we have a very good method in this country for putting failing banks to death. deposit taking institutions that are insured in regulated. we have not had a method of putting out of everybody's misery non-bank financial institutions. what he recalls an said was, under the law, there are two choices. you can let it go bankrupt and none of the debts would be paid if there were not assets to pay it, or you could step in and the federal government would try to ease the pain, but it would have to pay everybody, because there was no legal basis for discriminating. he said need to take a method that we have and does all nonfinancial -- non-bank financial institutions in the

manner that we would with banks. in 2008, wachovia fell, but did not cause any great disruption because we had a method of resolving it. aig and lehman brothers failed, and they were very disruptive. he said let's have a method for resolving these institutions. there will be no more to big to fail. there will be institutions that may be too big to fail without the government dealing with some of the consequences of failure, but be very clear that no effort to alleviate the consequences can take place until there is failure. governor palin, with whom i do not always agree, was right on one point when she said congress would be in acting death penalty. she had them in the wrong bill. [laughter] we are going to put to death non-bank financial institutions, but the principle is there. it is not enough simply to

prepare for failure. you want to diminish the risk of failure. there were large, wholly unregulated entities. the best example is aig. aig was selling credit of all swaps. if you sell life insurance, health insurance, you are required by a state regulator to have accommodation of reserves and reinsurance of you can pay off the claims. people were allowed to sell credit of false walls with no such requirement, because they were not categorize. so aig sold more defaults walks than they knew they were selling. not only did the government not know, aig did not know, because when ben bernanke in 2008 came to us and said i am going to lend $80 billion to a i g out of my authority, because we have to pay off their debts, what happened was, lehman brothers failed over the weekend in

september, and secretary paulson thought he had a bank ready to take it over. lehman brothers fell, nobody got paid anything, and according to bernanke and paulson, the financial system was about to grind to a halt, because everything depends on landing. -- depends on lending. so he did not do anything. he got terrified then, as did bernanke, because the thought of major depression was in the offing. when aig said we are next, we cannot pay our debts, they came to us and said, if we do not do something to alleviate the consequences of a ig's inability to pay its debts, the economy stops. that is when we began to get involved. that was their choice. lehman brothers and aig, two

non-banks. after the bill passes, that will not be the case. they will have the authority to step in, but the failed in the out of business, abolish all the equity, etc., and use money raised from the financial industry itself to pay off some of the necessary gets to keep this from spiraling out of control. it is a model very close to what the fdic does. sheila bair has had a major role in deciding this. the first part is, how do you keep this from spiraling out of control, and getting too indebted in the first place? there will be no into the america that does not have to report its financial transactions to regulator. hedge funds, private equity, investment houses, etc. that regulator will be charged with wanting to make sure that the entity does not get so indebted that it will be unable

to pay its debts and in police car on the rest of society. if that indebtedness -- and inflict harm on the rest of society. there is no prior designation of any entity as systemically important, because that creates the moral hazard of them having the advantage. if such an entity should start to become problematic, we stepped in and impose limits on them. we also do that with regard to activity. it is not simply large entities that can cause a problem, but a pattern of activity. no one was looking at subprime mortgages. we make specific rules for derivatives. no derivative contract will be allowed unless it is reported

through the appropriate steegen. that has the advantage of price discovery for those who are participating, but allows us to make sure that people are not so over indebted that they will fail. aig able to sell credit of false walls with no restraint. the problem was that they were insuring against a drop in house prices. they had no capacity to pay off in case there were failures. the reason is that they assumed that house prices could never brought to that extent. in effect, aig thought it was in the business of selling life insurance to vampires. you do not have to build up much reserves. then when the vampire start to die, you will be in big trouble. that is what happened. in the future we will deal with that in several ways. we will know what kind of

insurance credit defaults laws are being so. we will know whether capital is. the regulators will be empowered to impose capital requirements. that is the essentials. it is to have a method to put them out of business if they fail, but to drive by monitoring them and imposing capital requirements and other restrictions in necessary -- it necessary, as well. 30 years ago, almost all loans in this country were being made by banks, deposit taking institutions. that is how you got the money to make loans. they got them from deposits. most loans were made by regulated entities. there were also made by people who expected to be paid back by the bar or. then we got into liquidity and securitization because of middle eastern oil, asian countries

with heavy balances of trade, and other factors. there is no money available to be let in society outside of the banking system. they called it the shadow banking system. that meant there were no regulations. secondly, because of various things that were developed in terms of the physical situation, people could make loans and then sell the loans, secured does asian. -- securitization. we borrowed from the sick it -- if you make alone and selig, in most cases you will have to retain five set recovers inside and takes -- if you make a loan and sell it you will have to retain 5%.

you do not have any money, and you are complaining because it will -- will lead guitar for you to lend money that you do not have. the answer was yes. i was told at the world economic forum that someone needed $20 million to buy a property, and he asked banks on friday to let him know by tuesday if they could participate in that loan. by sunday, he was oversubscribed. he asked the banker why he got such a response, and they said they only had to ask one question about the purchase. can we sell the loan? they felt no need to check and see whether it was a good underlying activity. we also at a consumer protection

agency. we are born to get a test of regulation. we are often told by people in any business, don't legislate too rigidly. don't go up to the line. leave us some flexibility. on the other hand, when an incident arises such as goldman sachs, and many people think that what they did was not appropriate, the response is almost always, the law did not specifically prohibit us from doing it. businesses cannot simultaneously argue to us for flexibility but then in a tough situation, argue that because you did not make it specifically illegal, you cannot complain. if that is the case, if there is not a willingness to comply with the spirit beyond the absolute letter, then we have to write the absolute letter. i should make one last point. what we are doing conceptually.

our problem was not deregulation. the problem was not regulation. we did not have rules for credit of all swaps. it was a new phenomenon. periodically, in our economic life, the private sector creates a degree of innovation that changes things qualitatively. while that produces benefits, there are no rules for it. what we see ourselves doing now is putting rules in place for new economic phenomena that have value. there are viable renovations in the business world that have benefits that do not have rules. in 1890, when america had been transformed from small enterprises to large ones, you had problems. theodore roosevelt's job was not to break up the big

corporations, but to put in antitrust and other rules to regulate them. franklin roosevelt did not destroy the stock market, he put in rules to regulate it. we see our job as doing the same thing, and that is what we hope to do agree with that, i will be glad to throw this open and respond to any questions and comments. [applause] >> thank you, congressman. i have a few question cards already. i want to ask the very first question. you had talked about treasury department having a plan to salvage lehman brothers in 2008, and then the british regulators essentially torpedoed it and put us in the mess we are in. i hope there are no british people in the audience. [laughter] with all that we are doing here,

how much more does a the end of may coroneted global regulatory regime? >> the financial service authority told barclays bank that they should not do that. nothing in the world is more mobile and capital. it would be very unwise to try regulations.ateral set of i have spent more time in foreign policy than ever before. i met recently with the finance minister of canada. there is an ongoing effort that i believe will succeed to have similar regulation with the european union, the united kingdom, with canada, japan, and we have in our bill a mandate to

treasury and the federal reserve that if any small entity decides to be a haven from regulation for capital, that country's institutions will be excluded from participation in the american financial system. they will be denied access. i am in negotiations with regard to hedge funds. they are worried about excessive restrictions by the eu on people who are maintaining capital for others, people who hold others. we are very aware of that, and we believe it will get a similar set of regulations. that is one reason why, if there is a tax on financial institutions, which i believe there should be, it will be on institutions and not transactions.

transactions are infinitely mobile. institutions are not fixed in place, but they are far less mobile. trying to tax transactions is very difficult because of their extreme mobility. >> could you comment on the flash crash and whether or not you believe the sec is likely to be able to truly identify what caused it and to remedy it? >> a very important question. i want to give it one of my rules of politics. try to avoid telling people more than you know. [laughter] i think a lot of people have done that. when you have entities doing millions of originations and selling them, there is no way

anyone could have told you how valuable they were. one of the best things in our bill is that we repeal every statute and mandate the regulators to repeal every regulation that requires people to rely on the regulators. we did not mandate that people have to abide by them. we think that will help in the overall degree of healthy skepticism in the financial world. clearly, they are looking -- there is a debate. at the very least, there is a consensus that there has to be coordination of the shutdowns. when one exchange shuts down, the others do not get in balance. beyond that, there needs to be some greater degree of human

intervention. every trading platform, if all is ordering -- order online trading platform, -- they are still looking for the final conclusion. >> we have another question from the audience about the financial reform bills in the house and senate. in the house bill, there is an exemption for small public companies in compliance with store brands oxley that is not in the senate bill. -- with sarbanes oxley. >> it has a heavy vote, and i believe that the votes are there, whether i like it or not, for that to be maintained.

i think that will be in the final bill. >> there is a question in the back somewhere. >> there been a number of sessions talking about collaboration's and ways that companies could be proactively involved with both government and ngo's. harvey pitt suggested that companies should definitely be proactive and their relationships. could you make some suggestions about how companies can be involved with the government, with the congress, with ngo organizations that you respect to show that activity in support for what is going on, and also make sure it is molded in a way that can be helpful from their point of view? >> if i were to urge companies to be more proactive with congress, my scheduler would shoot me. i spent a lot of time doing that. there is a great degree of

engagement with the congress. and i think with the regulators. the piece of that i would encourage is with the non- governmental organizations. i think -- we here in parallel from them, and they do not talk to each other. i would urge you, not every ngo is one that people will feel is reasonable. obviously there is no point in dealing only with the ones you agree with. there are very capable ngo's there that have a somewhat different perspective. i would urge a greater effort to reach out to them. i do think the interaction from congress is pretty full. with the ngo's, i would encourage you to think of all those active in the field you

are in and start meeting with them. >> the senate bill has a provision to require majority voting in elections. do you think that will make it into the final bill? >> there will be some access issues. what we do in the house bill is to be the sec in charge of that. they have a rule to deal with that. there will be a move in that direction. i think we are at least going to empower that sec to do it. beyond that, i am not sure. at this point, it is still up in the air as to whether or not there will be specific rules in the final bill, or what we had

in the house bill, which is removing any doubt what the sec is the ability to do. >> what about self funding for the sec? >> what i am hoping it's worked out, this will be with their greater participation, is a way to do some self funding which leaves the appropriations committee with the role. if you look at the performance -- it is what i think about separating the ceo from the chairman of the board. people say that is very important, but my guess is it to draw up a list of major companies and did not tell people which was which, there would be no way to differentiate by any kind of results analysis.

the appropriators are going to push hard to maintain some role, and i think that will be successful. >> can you talk about how derivatives oversight might play out? >> paul volcker rule is very important in this sense. does not distinguish between derivatives and independence. derivatives are a great example of a phenomenon that has grown up with no regulation. there was an effort to get them regulated, and it failed. they were never deregulated. that proliferated and have grown beyond their original use. you are in the business of producing a good or service and you want to be able to control the costs and make pricing decisions based on that. you want to control for volatility in an area that you have no control over.

you want to give up the possibility of a windfall if you can prevent against the bottom dropping out. we try to conserve the ability of people to do that. all derivative trades will have to be reported. i think that is in everybody's interest. i think in some cases they may end up paying less once they see what the price is. when we talk about trades between the financial institutions, i am skeptical. the role of the financial industry is to be the means to the end. to help people accumulate capital and make it available to people who will use it for a productive purpose. much of what has been going on has become an end in itself. to the extent that can diminish by regulation, that is not that is an unintended consequence.

they will have to be sent to a clearing house. if the clearing house believes that it can except that they are sufficiently understandable, they will have to be cleared by the clearing house and sent to an exchange. those that cannot be, i hope that the regulators will be allowed to make margin requirements in their or collateral work permits, although we will allow for any kind of -- for in time collateral. if you or someone who is not doing derivatives as a major line of defense but only hedging your own risk, then you will have to report them and you will have the option of going to a clearing house if you want to. the volga rule says banks should be doing things for their customers, not running conference centers for their own accounts. that is very likely to be

adopted. there was a central role by center lincoln that said there are no derivatives at all. that goes too far. they ought to be able to hedge for customers. what paul volcker and sheila bair have said, with regard to banks, there is a separate set of rules in terms of price discovery and putting them into an exchange of possible. with regard to what banks do, i don't see the need for a separate rule regarding derivatives, because the restrictions on banks' engaging in proprietary activity would apply to derivatives as well as ngo's. they will not be allowed to run separate profit centers for the trade with each other. >> neither the house or senate bill really addresses the big four accounting firms and how they may have allowed the financial crisis to happen.

is it because we are afraid to hold them accountable? >> what we hope this that what we do with regard to regular, underlying transactions is restraint. we are not of backward looking into deep. if people -- we are not a backward looking entity. i grew up in the era of joseph mccarthy. i remember watching the mccarthy hearings in high school. i have a fear of congressional inquisitions. i don't think that is what we should do. there are prosecutors both civil and criminal, and i would let them do that. going forward, there is one area where i do have some differences with the accounting firms, and we may get to this or not in this bill.

that is to refer to the supreme court's decision. there is a version of the senate bill that is a little too harsh, but i think at some point we hope to say that where and abetting party was clearly negligent or worse, that they should be sued. >> in that vein, in the next month or so, the supreme court will give its verdict on the constitutional see of the public accounting oversight board. >> if they find it unconstitutional, will come up with a structure that meet their decision. we cannot really decide that until we see the decision. if it has to be restructured, it will be done in a way that is

compliant. i have time for two more questions. >> what are your thoughts on regulating the of financing industry? >> i was for treating automobile loans the same as any other. you are a merchant and you are extending credit yourself, you are not covered by the consumer agency. if you are a merchant and extend credit in a way that relies on a financial industry and you securitized loan, then you should be covered. it came up at a time when the auto dealers were objects of great sympathy because they were being treated unfairly by the big auto companies. people were having contracts yanked. i would treat auto dealers the same as everybody else.

a basic transaction that you finance, you give people credit, that is not regulated. if you arrange financing through a third-party, that should be covered the same way. >> maybe the hardest question, how do these bills become so big? >> if you read about 1300-page bills, get one page of the bill and read it. it takes about four or five of those pages to make a real page. seriously, we leave room for intermediation. that is why they are numbered. it is probably four or five pages to a bill. we had a separate committee

markups on consecutive segments. the reason for doing it all at once, the things are interrelated. people want to tell me you can deal with derivatives but do not deal with what happens to failed institutions. i think the basic answer is, the ankle bone is connected to the shoulder bone. [laughter] >> thank you very much for your time. [applause] we will break for coffee now and then the sessions resume at 10:00. we will have lunch here baguette 12:30, so i will see you back then. >> it is an evolution of

agreements that go back to the 1970's. particularly the periods of start agreement that were started in the reagan administration and continued in some form in every subsequent administration. >> watch the moments that make history, right now online at the c-span video library. it is washington your way. every program since 1987, available free online. >> supreme court justice anthony kennedy on the prospect of a new justice. >> it is stressful for us, because we so admire our colleagues. what i have great admiration for the system. the system works. after the appointment and confirmation process is finished, if there is a confirmation, the system will bring us a very good new

justice. >> with the confirmation hearings for elena kagan starting june 28, learn more about the nation's highest court in our book, "the supreme court," available now in hardcover and also as an e-book. the health and human services secretary said rebate checks for senior citizens experiencing a gap in their drug coverage will start going out in june. she spoke with reporters on the new health care law. this is about 30 minutes. >> welcome to our first media briefing on implement the affordable care act. we plan to do regular updates. i am pleased to be joined by three of our department leaders in implementation who are carrying out this new law. the debt be an administrator for

the sense for medicare and medicaid services, the director of the new office of consumer information and insurance oversight, and the director of the office of health reform. they are with the year on the stage today. about two months ago, president obama sunday of laurell care act, and we have been acting quickly to fill the gap -- president obama signed the affordable care act. americans who have waited years for health reform to pass are already reaping the benefits. there has been an administration-wide effort under the direction of the president. our department has taken the lead on many parts of the affordable care act, but there are other departments involved, treasury, labor, justice, the small business administration, and many others have played

important roles as we have taken the initial steps to deliver the promise of the law. congress has been a great partner. we have worked closely with states, also, hosting a weekly call to get reports on the ground, answer questions, and plan for the next steps. we have had an aggressive outreach with a variety of stakeholders, provider groups, consumer groups, and we are working with insurance companies. first to ensure that two provisions of the new law that were supposed to go into effect in september, the ban on recisions and expanded coverage for young adults, actually kill again right away for many americans. earlier today -- actually kicked in broadway burke many americans. -- actually kick in for many americans right away.

i gave an update on what we are planning in the patient's bill of rights the that will be put in place next month, giving health care consumer simple and clear information about their rights and their choices, and there will be a straightforward appeals process to protect those rights. i previously called upon my former colleagues at the state level to use the powers than have to reject unreasonable rate increases, and today, we talked to ensure is about doing their part, too. reminding them that the affordable care act actually gives hhs a variety of new tools to limit hikes from the right to review increases to any requirement, the medical loss ratio, that requires insurers spent at least 80% of their premiums on health care. as we proceed, we will continue to look for opportunities to work with insurance companies, but also keep a close watch to

make sure that they are treating their customers barely. going forward on implementation, i am going to be using my experience from past lives as both the governor and insurance commissioner. as a former governor, having to balance the budget every year, and know how to make strategic decisions on implementation. we start with the policy that we need to make the most of the resources we have. as we carry out the affordable care act, we are relying heavily on many of the talented health experts that are in our department, some of whom were here during the implementation of medicare part d and have been especially helpful in sharing lessons from four years ago about what worked and what did not work so well. also, taking the insurance commissioner role that i used to have and the consumer focus that

we had in that department and putting it at the heart of these efforts. if we have a guiding principle when it comes to implementation, it is really giving americans more control over their own health care. for years, it fell to many people like their health care challenges were growing and there was absolutely nothing they could do about it. pick up the mail, and they were looking at a whopping rate increase from their insurance company, or a notice that the coverage was being canceled. or they would look for a new policy and try to sort through dense pages of fine print, or learn that they were denied because of a pre-existing condition. in the last month, americans are getting some good news for a change. small-business owners have been alerted that they may be eligible for the tax credit to help them cover their employees. as we talked to the interest today, we are very hopeful that that can begin to stabilize --

as we talk to the insurers today. parents know that they can cover their adult children under insurance policies, and i have heard from lots of folks who work terrifically relieved that that option is now available. large employers are getting help they need to continue to provide coverage to their retirees. that market was beginning to be very shaky as employers were looking to cancel retiree coverage because of the rising costs. they now have some federal help. seniors have gotten information informing them about the new benefits they will get under the affordable care act. today, we want to share some news with you about how the new law is taking shape. one of the biggest ways the new law is going to help seniors is by gradually phasing out the

medical care -- medicare prescription drug though not a whole that has made it hard for seniors to afford their medication. this morning, we have a new brochure on our website with information about the first step of the phase-out, the $260 rebate check that will be mailed to any senior who falls into the doughnut hole this year. we can also announced today that we are continuing our street of early implementation by sending out the first rebate checks on june 10, rather than later as had earlier been suggested. as we move forward, we have two very important jobs, continuing to implement the law carefully and responsibly, and keep americans informed about what is changing and what is not

changing. we believe the second job is just as important as the first. over the last two months, americans have been getting continued misleading information about the new law. increasingly, we are also hearing reports of criminals using the law as an opportunity to commit fraud. whether it is by selling fake insurance policies or tricking seniors into giving away their medicare numbers, we are committed to continuing to provide americans with accurate, up-to-date information about the affordable care act, so that the scare tactics and scam artists do not take away from this historic legislation. another of her -- we ask state attorneys general to be involved in the effort to crack down on potential scams and frauds. over the months to come, we will continue reaching out to americans across the country to

educate them about the law, answer their questions, and listen to their concerns. as we proceed with implementation, we know there will be twists and turns and comes along the way, but in two months, i think it is clear we are headed in the right direction. i appreciate you being here today, and happy to take some of your questions. >> the provision for the young adults, for self insured plans, they do not have to add people, they can wait until the beginning of the plan year, right? something like two-thirds of the americans who get their coverage through work in the self assured -- self insured plans. replanted take action to convince them to put children on earlier b.g.e. are you planning to take action?

>> we already are taking that action. we are reaching out to large employer groups, asking them to look at the opportunity to open the plans earlier than mandated and make this coverage available. in fact, we believe that it is potentially cost-effective to do just that, rather than disenrolling and adults and then having to our region and be enrolled them. this actually may be a cost saver overall. there's a strategy going on to actually reach out to state government groups, to universities, to large employers, to others to ask them to follow the lead of 65 or so companies who are opening the plan year earlier than anticipated.

>> can you address concerns that people have been expressing that some employers, it may be cost- effective for them to drop insurance and pay the fine rather than pay for insurance? >> i will take a crack at it. first of all, there is no mandate that small employers cover employees at all. if you have less than 50 employees, and that does not include part-time workers, you do not even fall under the umbrella of employer responsibility.responsibility .

that they did not bear the brunt of employers not covering their employees. there are a series of provisions that yet in 2014 to really compensate the taxpayer -- that starts in 2014 to really compensate the taxpayer. we're hopeful that it really

operates to encourage employers to continue to offer coverage and offer credible coverage that really provides for the range of services that families are looking for. >> i am from the wall street journal. used but -- you spoke with the insurance executives about the need to keep them from unreasonably raising their insurance rates. can you tell me what, specifically, you asked of them when you spoke about this? on the doughnut hole, about how many americans will get that check on june 10? but in response to the first question, we have a lot of discussions -- >> in response to the first question, we had a lot of discussions. rates are now at a crisis point. they are looking at the market

where more people are dropping coverage because of the increase in price. looking forward, what we talked about is the corridor between now and 2014, when we have a new option for a number of people, particularly in the small group and individual markets. strategy's about -- strategy about how much oversight there will be, about actuarial projections of trends, what kinds of balance their needs to be, about cost. the insurers seem very aware of the fact that cost control -- all of us working together on that is something that is going to be very important in these intervening years. frankly, we are eager to learn from the private market

strategy what has actually worked in terms of better health outcomes at more affordable rates. a number of the large employers and private markets have been implemented strategies that we think can be very effective to learn from. there is an understanding that we will look very carefully. we talked about the fact that rate regulation will be at the state level, but absent state oversight, absent state intervention, we are the backup. we're working with state regulators to help them to help enhance the tools that they have, implement a broader array of statutory responsibility, and that we're going to be looking very carefully at what is happening in those marketplaces going forward. the worst of all worlds is to have more americans driven out of the market in the next couple of years, and end up with a

sicker population because they did not have ongoing health care, preventive care, coverage when we hit 2014. yes. >> thank you. julie robert sutter -- julie rovner. it has come under some very harsh criticism from republicans. what is the administration doing to defend their nominee? how dire is it to need someone with the senate confirmed, given how important medicare is to the implementation of this new law? >> i did not think there is any question that the doctor is a highly qualified nominee and one of the nation's most recognized leaders on improving health care for all americans, in

figuring out strategy that works, working with hospital systems, working with providers to save lives. frankly, i am really pleased that he is willing to leave the private sector and consider taking on this responsibility at this critical time. i think it is unfortunate that some of the criticism directed against him as little to do with him. it is a real litigation -- a relitigation of the health reform legislation that is now the law of the land. we're hopeful that endorsements of everybody from the hospital association, doctors' gropus, a groups, a doctor's' variety of officials, both democrat and republican, can be helpful. if you look at some of the

criticism, it has less to do with his qualifications and his leadership, and more to do with rehashing some of those arguments that they may against the passage of legislation in the first place. >> following up on the discussion earlier about employers, extending coverage to adult children, would you think or hope that that would be done at little or no additional cost to the employees? >> yes. i, again, do not have the solid projections here, but what i have been told by a number of individuals is that this is likely to be an overwhelmingly healthy group of

individuals, that whenever health concerns -- whatever health concerns may have, at 19, 21, 25, 26, it is unlikely to be the age differential that would cause a different projection. it is very different than picking up a group of 60-year- olds who have been uninsured. considering the coverage -- their health status, their health condition, their health experience -- would have been drug-related into the package. -- would have already been calculated into the package. if you look at the individual market, younger, healthy adults are by far the cheapest people to cover in the market. they get the best possible quotes. most health plans are dying to get these folks involved in a

pool. arguably, it could even make the pool health experience look a bit better overall, by including these folks for a longer period of time. yes. >> fox news. former cbo directors have done analyses on the new law. he has concluded that it will mean as many as three times more than originally estimated will seek subsidies, and it will increase the cost of health care from $900 billion to possibly $1.80 trillion. what is your response? do you believe that the original cbo estimate will stay true? >> i have not seen the analysis that you talked about. and no idea about the assumptions he has made. i have had the opportunity to look at the cdo information over the course of time.

-- cbo information over the course of time. i think that their population, which is based on their analysis -- their calculation, which is based on their analysis and their opportunity to look of the whole situation, is accurate -- to look at the whole situation, is accurate. i cannot talk about what you just read to me, because i have no idea what he has looked at to change those assumptions. yes, sir. >> i have two quick questions. how many seniors will begin in rebate checks? -- be getting rebate checks? >> 8000 at the first mailing. we think there will be about -- i am getting my help year -- little over 4 million seniors will get the checks. -- getting my help here -- all little bit

over 4 million seniors will get the checks. i will ask her to tell you what kind -- over what time they will go out. >> the checks will begin in early june and will occur every 30 days until the end of the year. depending on the seniors expenses, they will hit the doughnut hole at a different time throughout the year. we will follow that within 30 days to get the checks out. >> i should add a footnote. we would love your help in getting the word out. seniors do not have to do anything to get this check. they do not have to sign anything. they do not have to apply for it. their billing history will be monitored by cms and it will automatically get the check. if anybody shows up -- and

they'd will automatically get the check. -- and they will automatically get the check. if anybody shows up to ask for your information, report them immediately. we have reports in some jurisdictions that scam artists are doing just that, showing up at the door, asking for their information in turn overo sign%- personal data -- and turnover personal data. nothing is required to get the check. if you reach the doughnut hole, that check will automatically be mailed. yes. >> i am with "the washington post." regarding the medical loss ratio requirement, it has been argued that this could create perverse incentives for insurers, that

requiring them to devote 80% or 85% of their premiums to the payment of medical claims and the like, could give them the incentive to allow reimbursement rates for providers to rise or to raise their premiums, either of which would allow the to recoup, in absolute terms, the same profits, or devote the same amount to administrative overhead. what do you see as the risk? what would prevent that from happening? >> i think that the definition of what is considered as a medical expense, what can actually be absorbed in the medical loss ratio and what is outside that is an ongoing conversation. the law provides for the national association of insurance commissioners to recommend a definition of what are the factors that should be

on the medical side of that loss ratio, and what should be outside of that. in the law, they ask for that definition by the end of the year. they have voluntarily agreed to accelerate that process and give us the recommendations by the end of june, which i think will be very helpful. this was part of the conversation that we had with insurers today. we talked about not only how the assessment will be made, about what the medical costs are, but another factor is the fact that we do not want to lose some of the strategic initiatives that have actually yielded a lot better health outcomes that may not be directly related to a provider-patient visit, but have actually produced healthy results. results.