interdiction preventing these exist within a system that we're trying to strengthen every day. >> de you think that department is doing the right risk-benefit analysis, given some of these that have not paid off? >> governments spend money and expand money in three ways. governments spend a lot of that. you invest some, and you placed bets. will this work? pity i.

>> would it have caught him had he been put through it? >> there were no silver bullet. >> would it have captured him? possibly. are we looking for absolute? my answer will be disappointing to you. does it improve our ability to detect? absolutely. >> it is worth the amount of money we are spending for that degree of capability? >> that is one that we are asking ourselves every day. compared to what? we believe in the technology. we believe it enhances security.

>> penetration testing. there are a appalling results. >> i am not going to go into any detail about our technical capabilities. we see improvement of the time. >> significant? >> significant improvement -- i would say the answer is yes. when the challenges of all, our technology and systems have to evolve. they will. >> air marshals. do you have enough of them de -- of them? >> you will never have enough for every single flight every single day.

combining a risk-based approach with the right number of personnel, we think they are an important asset. >> what kind of increase would you like to see? >> this is an element of the entire process. it is weighed against the other elements. rather than a pop off with a 20% increase, what we want to see is a system that the traveling public can have confidence in and give them a say travel experience. one thhng we've learned about abdul mutallab, we learned a number of things. we learned that if you can access the global aviation system from any airport, you can have access to the entire system. this is an individual that bought his ticket in one place, boarded in another, headed for a fourth location. you can put any city on the map.

what we have to do is to travel around to the aviation partners in the world. we traveled to six continents and talked of what the elements we need to put together to ensure each of the public that they are safe. it al qaeda is putting their best minds to this problem, we certainly need to do the same. we are. we confirmed that we need to do better at information sharing. >> internationally? domestically? >> internationally in this case. it is one thing to deal with individuals that you have identified. it is another to deal with the relatively unknown. this individual was not totally unknown, but relatively unknown.

we did not connect the docts, that requires a commitment to standards of information. the second things relate to technology. -- and the systems that are in place . do we have the right kind of technology deployed? are people using it? are we satisfied that the systems that are in place meet the standards that we think need to be met? we know the strongest members of the system have to help the weaker members. >> looking at the international situation, is the world as a whole anywhere close to where they need to be in terms of tightening aviation? >> we think this has been a major agenda. >> how much progress had been

made? >> enormous. every region has had secured agreement with countries going into a major gathering in september to address this question. >> what are the specifics? >> higher standards for information gathering and sharing. better uses of technology. practice. it is not just any single discrete piece of equipment. it is the whole system that we have increased in an airport that makes for a secure system. a mutual commitment to raise those weaker parts of the system.3 couple of time. a similar bomb had been used against the saudi officials. a u.s. officials of gotten a briefing about a particular type of bomb. it does not appear that the information was disseminated to

the psa -- tsa. am i correct? why did it not work that way? >> what i will tell you is that tsa every single day has a robust playbook of measures that it uses and it employs those measures so that we do not give a potential adversary the benefit of predictability. in partnership with many countries around theeworld, they are constantly updating our knowledge based on what exists, what kind of explosives, what kind of technologies, what kind strategy's tariffs may have -- terrorists may have. >> [unintelligible] >> the kind of material is not part to go the exotic. >> but he put it in his

underwear was something that it only been seen in saudi before. >> without going into some of the specifics of the case that you are talking about, we knew about this kind of material. we are constantly working to ensure that we prevent that kind in danger from happening. >> another part of the mission is to protect mass transit. something what 1/3 of the terrorist events have been against mass transit. are they devoting the resources and time it should be to that particular problem for are the systems and protective of? >> -- i would not say they are unprotected will. we need to take a approach that the department has a very

dynamic dialogue. not only with a major cities where the system is currently but they extend nationwide in with the private sector. we are committed to a program that engages the public, informs the public, to be aware and alert for potential dangers and employed best practices for the individual travel reduce its vulnerability. we are working on ways to strengthen the protection of mass transit. can we do more? of course. >> of monies allocated based on risk, it should seek very high. explain. >> you almost explained it yourself with your statement to give it is true. is there enough money to go around for everything that it needs to go around to?

the answer is no. are we without any means to protect ourselves? it is understanding how we can add value to whart the pr ivate sector is doing. >> a lot of these issues will be i cannot let this slip away without asking about -- the inspector did a report recently that said you did not have the manpower or capabilities and you are not of to the job. but there were some good things in the report. >> there were a lot of bad things. >> what are we facing with

cyber? it was the department that called out to insuring our cyber security as a core mission of what it means to talk about a safe and secure place for the american life. a cannot tell you how many people have come up to me who worked at the state level level and said we have always known cyber has been out there. whenever have given it the kind of attention. we will now produce consciousness. we will now. consciousness is raising. cybersecurity is about two things, protecting your information and your identity. that is what it means. it meann that you can engage in cyber activities confident that your information is safely getting where it needs to go. information that is a writing to you is from who says they are sending. how do we do that? the federal government does nnt

always have the resources to do we cannot do it alone. not only do we need to engage the american citizens who feel as though they own their information and identity. we need to engage the private sector as well. we are. this is a committed partnership that the department is it part of. >> according to the report, about half the positions are unfilled. why is that? >> there is great competition for highly skilled cyber capabilities. we aim to become charged with the presidential directive with ensuring the security of the .gov spave ann the .com space. >> how you get there?

quite how the attract them? >> attracted to public service but . we are attracted to work on something bigger than ourselves. can we pay them the money that in private industry could pay them? of course we cannot. we can reward them with good work and opportunities to explore and develop and create a safe and secure cyber environment that will benefit us all. but they read this report and juice. >> we base our life decisions on a single report that the week. >> it is not a single report. >> the point is for cyber security is that for the government to become engaged in a centralized way were we can

reveal our value proposition, i feel certain that cybersecurity will not mean that the federal government has not taken charge of ensuring the security of everyone's computer or ipad, that we will have to have a system where people understand their security means. we have to create a new ecosystem in cyberspace. the department will be at the center of that security. the attraction of that, we are convinced, will bring in the best and brightest. >> the secretary said that she thought that the government might need more tools to monitor the internet. what is she talking about? what tools? >> we the book -- we know that

the internet has had an affect. there may not be any such thing as minority anymore. you can find your affiliation on the internet. you can bypass the barriers of being a party of one or feeling alone or isolated. we need to understand what are the means by which people that the iceland are motivated to violence. we know the internet service in some cases as an accelerant in that. we saw this with hate radio in rwaada. you do not blame the internet for do you do not blame review. what you understand is that it is an accelerant to violence evidence. what tools is she talking about

when she says we need to monitor it? >> we need to understand . tools are not just technology. tools are also an understanding and process fees and were prophecies and procedures. we give them tools here there we need more tools to understand how the internet functions. >> the color--oded threat system. it came to me as a joke. there is a group supposed to make recommendations. they came back and said,

simplify it. make it easier the it needs work. has anything happened to those recommendations? labeouf we have been implemented measures as part of the federal family in responding to increased circumstances of concern, a threat. the color coding system has not been the mechanism that has conditions how we respond. secretary is looking at those recommendations . how do we put in place a system that has value added to our

ability to ensure our protection? >> when will we see changes? >> when they are dumb. -- done. we know what it means only talk about a secure homeland. we know that the american public has a right to expect aawe can do three things. we can execute those missions. we can run ourselves. we can account for the resources that have been entrusted to us. this is an operating department. there 22,000 men and women in the department. many are in operating

components. this is a department where every single day people wake up, go to airports, are on secret service detail. they are doing will rescue. they are operating on behalf of the american public. they are our most precious resource. every day, we are doing things to free process to support their work. >> they are amongst the most unhappy people. they are the most committed and passionate about the mission. there are a number of them have said to me "this is something i feel very strongly about." their number of them to of said -- i wanted to the army. tomorrow i will have been out of the army as long as i was in my adult life. i thought a lot about the. i went to basic training in

1976. it is not a good time to be in the army. it was extraordinary, the post- vietnam feeling. i've had people in our department tummy that is how they feel -- tell me that is how they feel by the american public. we have to change that. they are extraordinary, the contribution they are making. it is my privilege to be my leader. it is my greater privilege to be one of their numbers. we have to give then the conditions and tools and the leadership and the working environment that they deserve to let a passion they bring to the job. >> a lot of places people interface is at the airport. they feel like they are hurt when they walk into a screening

line. >> thhy should not feel that way. a lot of the tsa agents come every single day, are committed professionals who have one job and one job alone, to ensure -pyour safe air travel. they dooit with commitment and professionalism. >> one last question, people who'll have secret clearances and want to come to work for your department are prepared an additional screening for suitability. why do they have to go through that? doesn't the secret clearance do that for you? doesn't it slow the filling of positions? >> it keeps some people away from government service. we are streamlining the process. there is a lot less checks been done than previously. it is a requirement of federal service.

elsewhere, the department of defense to ensure security clearance as evidence of their suitabblity. we are moving in that direction we are the largest federal law enforcement agency in the federal government. having a security clearance is not in fighting in new to work in the law enforcement job. it does slow it down. everyone knows it is not need any help in slowing down. we are working on that for defects borders as one of the parties you brought up. a lot of concern about how porous the southern border is. do you have indications that is being exploited by terrorists? >> the southern border, no, we do not. secretary in the paula tonneahan

borrer has never been more secure than it is today. >> the northern border certainly is. our borders are as secure as they have ever been. we have to create a system that keeps dangerous people out and a system that expedite legitimate trade and travel. we have to find ways and we are finding ways to expedite the legitimate trade and travel so we can focus on those dangers. >> howdy make it? -- hoo do you make it? >> then this can be climbed. >> even then, someone goes off ship. >> it is a question of working

from the federal government's point of view. working with personnel, working with technology. working with procedures to strengthen those areas of the border where been known each day and blow to do were they have to been known. at the betting legitimate trade and travel. >> of 1 to open it up to you guys. we will lead to get some questions here. please come if you would identify yourself. let's start with one further back. >> i am a citizen. there was a report i saw two weeks ago from a local ariz. tv station it reported that there

were hundreds of people from nations that sponsor terrorism including afghanistan, and egypt, pakistan, in the yemen, who had been detained as they are crossing into the country. is that a likely number, that there are hundreds of potential people from terrorist nations who are crossing on a regular basis? >> i have not seen that report. i cannot comment. we are working every day to ensure the safety and security of the southern border. as one who knows this area well , this order has never been more secure. we are working to strengthen the

measures that we have. no single part of the system -- it is a combination of personnel and procedures. we will continue to work on those areas. but there is someone else here. blue shirt. >> in the current fiscal climate, isn't it time to get rid of the funding formula? and replace formula that is based on the fact that north dakota has the same number of senators and then new york does. >> in our view, it is very clear. everyone faces some risk. we know that as we have translated into an austere

fiscal environment, a number of things need to be reexamined. we need to streamline our program. that is something we are doing. >> what about distribution and politics? >> homeland security is an extraordinary department. there are 180 congressional committees that oversee the work of the department. there are 50 states that are important constituencies. >> how destructive is that for the department? how distracting?

congress has been very generous. we have to answer. but its 108? >> 108. it is a lot. >> it is ridiculous. isn't it? [applause] >> it is a lot. >> i have to say, i am a bit baffleddby your remark claiming that the southern border has never been as severe as it is today.

what arr you basing that on? what is your metric? given that is what happened recently with arizona, aren't there some massive deletions? what is your basis for that? >> the secretary has been very clear. having committed to the border -- there were trained.

i'm prepared to say about the department of homeland security . you cited that at with the fundamental things. correct as a bit. we have to keep dangerous goods. there was no single silver bullet for that purpose. there was no daisy chain pradn. the federal government play this part. it is a challenge. you've never done securing your borders. >> let me go over here. >> one in the major recommendations of 9/11 was to

do with the issue of the communication systems. nine years in, there has been some progress but not very much. i am curious of your thoughts. >> i am an old signal officer. they have a way of managing what they have to do in the event of a crisis. this is a key element that really in his bid the coordination of assets. we have made some progress. we have not made enough progress. municipalities have very strong preferences. we are committed to the agenda.

we will continue to work on that. it is so fundamental. the department of homeland security is not the first response. crises happen somewhere. they involve somebody. first responders are often not even local authorities. we know this is where the work is done. we know this is the front line. >> yellow shirt? >> good morning. i am yellow shirt. i propose some of your statements regarding the oversight and the 2010 thousand

people. do you think it is wise to consider breaking up the department? you have an enormous bureaucracy. that which has to do with absolute national security. the other part, fema and all of that. it might serve you like better if it were in two diiferent agencies. >> no. you are talking to somebody who's been the first half of their adult life in the army and now i am homeland security. room this department is an extraorrinary combination of these assets. the met is better off -- fema is better off with the coast guard. the secret service is better off with the other assets. that issue is resolved.

>> of one to ask you, and you spoke a lot about stopping incident while they take place that is very difficult. how about considering launching programs for stopping cycling out of the country? will the trial take place in new york? what is your take about exposing this trial to the public? >> i'm not going to address the last question. i will leave that to department of justice. the federal government does engaged internatiinally with the

muslim world. the president's speech in cairo was a resounding statement of things. we have all been working with in that view. we have a challenge here as well. we know that. the muslim communities in this country bring a richness to our society, a commitment to the american way of life. there are larger communities within these communities within these communities exist. they all have to engage. we do not believe this is a problem you can simply arrest your way out of. it has to build -- be built on an engagement burd. based on the rule of law, all of the things we know.

we need to remind ourselves that it is available for all americans. that is our concern. we rae a part of t hat. >> ove rhere. they asked earlier about earlier tools that you might need to fight the war on terror. if you look at the international threat that we deal with, n we withsa and cia. we have more capabilities monitor what is going on the with a possibly hope to have internally. internally, it seems a lot of our ability to detect a threat in the making comes from a tip, informant or because the terrace decided to reach out to someone

foor because the decidey they wanted to have a vhs into a dvd. what other tools are there? we just looked at a bloody battle looking at fisa. >> this is what we are thinking about right now. the tools abroad may not be the tools that work in an decimus a -- in a domestic environment. we have law enforcement, both federal and state and local. state and local have enormous information and knowledge of their communities. they understand when things are very badly wrong. we need to engage them and connect them better through fusion centers and other prophecies for information sharing so that people have the

information they need and understand the action implications of the information that they have. it is an important tool entry source. it helps us in homeland security every time when we are confronting how to develop strategies like this to remind us of the american public, the power of american values. i am vthe power of american values. i am very optimistic about our ability. >> [unintelligible] >> did you want to propose legislation? >> i have a follow up. this is about the shahzad case. times square target number one, too, or three on the list. a lot of time and effort has been put on securing times square. a guy comes in there a parked

truck and leaves the due to our knowledge, not one surveillance camera caught him in times square. is something not working? isn't that why we had invested in that technology? but no single link in the chain is going to make use secure. new york city take aabackseat to no one. i am a new yorker. from our own perspective, i have spoken about the american public. we are the guardians of our civil rights. >> it is appropriate in times square that the have come down

to a vendor to save our lives? >> it did work. it did work. is that wh at we should be relying on in a place like times square? >> you are not a microphone. people cannot pick up. i cannot imagine it would be imagine if this individual races alarm and it was ignored. >> we need ll our tools. we need to mobilize all of our resources. this is a joint enterprise. >> i see a woman out here ha ha. -- out here. >> i have a couple of questions related to homegrown extremism.

how would you characterize the threat of the [unintelligible] do you believe it is in the u.s.' interest to see him killed, captured or kept on the run as he is today? but i think he has made no secret of his animosity and determination to claim violence against his country. i think he is a danger that ought to be addressed. >> what about the kill, captor, or on the run? >> ok. >> what is the long term interest? >> vdot about the long-term interest of this country. homeland security com -- what ds

this country need at this moment? we need a safe and secure homeland. we need a dynamic economic engine. we need strong friends and allies. we need predictable relations with others the d. we need ot keep ourselves secure. is he a threat? yes. >> my follow-up question is on this issue of virtual jihadists who are inspired to act for people like a lucky. they have a message that is really selling to these people. what do you see as our message to win this war of ideas? >> it begins to the heart i think of not just the

disaffection. i spent a lot of years thinking about violent conflicts and how do you prevent a violent conflict? people laughed at me. conflict has always been around. you cannot prevent war. my reaction is, war is not the weather. we should not act like it is. you are speaking to the root causes. that will be for those who specialize in that. our concern is when thit becomes violent. we are determined to do everything we can every day to burn and that violence. >> we have to leave it there, i am afraid. thank you so much. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010]

coming up, wheat talk with the president for the center of education reform about charter schools. the u.s. institute looks at narcotics operations in afghanistan. >> on tommrrows "washington journal," report on the effect of the housing economy. david savage with a look back at the courts term. we will talk to steven camarota about arizonas immigration law. "washington journal begins life each morning at 7:00 a.m.

eastern. >> what the entire confirmation hearings for supreme court nominee elena kagan, including her testimony and all the witnesses online at the sees them video library. it is washington your way. -- c-span video library. it is washington your way. c-span is available in 100 million homes. it is all a public service created by america's cable companies. >> now of of the performance of charter schools. on tuesday, we set it down with the president for the center of education reform. this is 40 minutes. allen is here to talk about a new report releasee by the department of education

showing the impact of charter schools. let me read you a little bit of what they found. on average, charter schools were neither more nor less successful than traditional public schools in improving student achievement, behavior, and school progress. what is your reaction to guest:? -- what is your reaction? guest: this is what happens when you have one study looking at a narrow scope of schools. we believe the best and verifiable data on charter schools shows that they are succeeding, coming from state data. we do not have one, national mode of comparison. the department of education would rather try to do the best they can making assessments nationwide. we are all upset with how things are going nationwide, and that is fine.

if you look at the vast majority, charter school students outperform their public school peers by 1 to 1.5 years. host: of what are you looking at in this study? guest: there is a state test, thanks to no child left behind, that shows where kids came in and where they left after a year's time. based on data, we tracked students from year to year, compared to students who were not in those schools. where you started and will year endedup is what you want to know, not some aggregate set of information. host: what is a charter school?

guest: it is a public school that is free from most regulations. it is a public-school opened by choice, accountable by adults. if they do not meet the needs of their students, they do not get the students, or they are forced to close. they are baseand rated based one results. host: how are they funded? guest: it is funded by the people, similarly to how public schools are funded. in most states, it is about $3,000 less.. they do not get capital facilities, and there is a huge battle about that. many of the students are at risk students who are not

succeeding in traditional public schools. host: who teaches at charter schools? guest: public school teachers. every teacher has to be qualified in the same way the state requires for all other schools. host: they have grown since the early 1990's? guest: yes, there has been a 10%, 15% increase almost every year. the laws in every state are so varied. there is not one uniform charter school law. some states allow school boards to open them. others allow universities to open them in colorado, you have a hybrid of state and local people opening up. some areas only allow for

certaii sizes. some say people money, equal students. a is a huge tapestry, if you will, and one that really embodies freedom and flexibility of states to prove -- pursue reform in the ways that they see fit. host: we have our traditionallines for you. we also have a line for teachers and students. we are talking about education, specifically looking at charter schools. while our charter schools necessary? guest: the great thing that people need to understand about charter schools is, it is great that we have a choice, but when we first started, there was no alternative choice for parents whose kids were not being

challenged properly. maybe they were being under challenge to come p over challenged, may be the composition was not right. we were not giving parents options to actually educate their own kids beyond traditional school, unless you had the money to go to private school. we were not holding schools accountable for results, so we were sending a bucket of money to these areas, regardless of whether schools open door now. charter schools were designed to give more power back to authorities. send mooney to a local school ad let the people there make a decision on how to best educate their students within a set of

rules and standards that we all agreed to. charter schools use those things that we know work best in public schools. performance pay, more tauruses, more accountability, more school-based budgeting. host: it is education tailored for each student's interests, need to? guest: in most schools, you will have a variety of offerings that you can buy into. there are some schools that are technologically suited for kids, the online mechanism, but in most cases, they will have a classical education. greek mythology, early american founding spirit you have some that are focused on the arts. you have some that are

vocational, some have a focus on a drop of kids. -- on dropout kids. there tends to be high retention rates in charter schools, and therefore, more success, over time. host: next phone call. caller: i am a professor at the university of miami. one thing that has been have paired with my students is hair reading comprehension has been subpar. reading comprehension and math skills are pretty poor. lots of my students came from public schools. there is a difference between the public schools and the ones that went to private schools. the ones that went to private school to cap -- tend to perform

better. what is the problem with public schools? obviously, you are pushing for charter schools, and i agree with you, but where do the problems stem from that want us to turn to charter schools? hostguest: the issue is not just about charter schools. this is just one tool that we used to improve education in this country. what you are identifying about the kids that you get is something that has been plaguing our country for some time. to many of our kids cannot read at a grade school level. we have a reading and comprehension problem. most kids are not being challenged to the point of where their potential could be.

weeoften think about what is on paper, what is in a curriculum. it is because we do not challenge ourselves every year, we do not have the accountability and that allows us to report or fire a teacher or principal, based on how they perform. we have to tie everything we do to student achievement. host: c we have thisomment fom twitter -- our charter schools a way to get around the unions? -- we have this comment from twitter -- guest: charter schools is all

about parent choice. when teachers wake up in the morning and they go to school, they are being talked to one on one. union contracts specify where you go, how long you are in school, what you're selling the is. if you have a salary that says you are going to be here all day, so many charter schools allow teachers to be around all day long. charter school teachers get paid roughly the same. the benefits that they bribed about, frankly, many of them come from the traditional system. your twitter guest, getting rid of the unions -- the issue is,

the unions are grappling with a complete change in the performance gap. they do not want to say is ok to hire teachers one on one. they believe that they need to fight against this reform. host: how has raced to the top impacted charter schools? guest: that added tremendous support to reform. it allows yet another chorus of support in washington to say this is a good thing. there was a lot of dialogue in the beginning about race to the top, that if a state did not have stroog charter laws, they would not qualify. when they put print to paper, it only accounts for about 8% of a state court. the that as it may, it was held

up as a carrot. some states did more than others, a new york raised its cap. but on the whole, it has been used to expand and strengthen the argument for charter schools. still lots of challenges come information. we welcome any time someone says this is great, but we need to do more. host: richard on the democratic line. norman, oklahoma. caller: my son and teaches physical education and my daughter is an rn. we all agree we do not have enough healthy bodies to promote healthy minds. if you do not exercise the body, the brain goes to waste. we need to teach the children to exercise, reduce their weight, and cause them to be more

influential to the teacher. host: let me ask you about physical education in charter schools. does it exist? guest: absolutely. not all of charter schools have the facilities. most do not, so they tend to find you need to buildings to have their activities in. some have access to a gymnasium, some have access to other buildings, others build buildings. some of them will contract the local karate provider. some may use a field in a park in the city. they know having that activity is important. what they can do, though, is the flexible to their program and to reduce those things that are

not paying off. i absolutely agree, the body is critical, but we need smart mind and body to understand. host: 1 study points to science and math results dwindling, and in this new study, it says in the analysis, lord achieving students had statistically significant positive effects on math scores. charter schools, those with higher incomes and private achievement, have a significant negative achievement on math test scores. guest: i discount a lot of what is in that information because it is based on sample data, does not account for where the kids came in and where they are going. these are national studies from

harvard, people who compare apples to apples. there is a child who enters or charter school in the fourth grade, there is another child who is not, compare them. overwhelmingly, charter schools are performing successfully. we survey schools every year. math and science comes out ahead in terms of focus point. there are high-tech, high technology schools. there are schools devoted to architecture. these kids are out in parks, rivers, streams. they are doing things that most public schools take three years to get permission to do. science, technology, math, education, it is a huge emphasis. host: fayetteville, north

carolina. a teacher on the line. caller: please make sure your guest answers my question. public schools, i want to know is it mandatory for private schools to take any, do they have the privilege of selecting the students in their program? also want to know, do they have special ed programs, something that all public schools are required to have. the whole world needs to know. guest: thank you for the question. money goes to charter schools as public schools, and in need to be treated the same way. schools need to take everyone who gets into the school by

lottery.. every charter school in the country is required to hold a lottery and there are more kids on list for that school. for example, healthy start in north carolina has hundreds of kids signing up who are african- american, low income. most of these kids are being taken from these lotteries, and they come with all of their issues, challenges, and once their kids are enrolled, will never tell them that they have been education problem. so absolutely, yes, equity. they take that risk kids, and

there are required to follow all the same rules. host: a tweet for you -- guest: is an interesting question about countries. i have not done that definitive work. it turns out most countries have most -- more choice than america, which is surprising, given the democracy that we have here. if you look at switzerland, chile, there are not only subsidies for a kit to go to public schools, but there are a wide variety of options. competition in our country seems to be an anathema because we have school groups that somehow think it is threatening. we might be good to look to other countries. host: gilbert on the democratic line. caller: i have almost 40 years

background teaching and i have worked with a charter schools here, and public. charter schools, in many cases, if they are doing this great job, the one that did the best was the one that got the smallest amount of money. i want to say this. if you want to get the best out of your dollar educationally, you must go with vouchers. for the charter schools, the mere fact that parents are looking for something better for their children indicate they are looking into the educational ffcility of their children. this claim is not something that

they deserve. with vouchers, it is really free enterprise education. let me explain vouchers. however much money you spend on public education, that money will travel to whatever school ttat child may go to. i think vouchers have become the answer. the education system has become a political quagmire there are people who have no business being there and they are supposed to cut the footsteps of education for our children. guest: vouchers, scholarships do have the money following kids, which goes to the school of their chores.

-- vhoice. vouchers play a role in charter schools in about the dozen states across the country. the moderate choice of both political parties happens to be charters. and a more joyous, the better. for cities like washington, d.c., boston come tulsa, tulsa,r we can do is critical. whether it is better standard, a teacher quality initiative, we just need to do better for our kids. the more money that goes to local level, the better off we are. host: "for every local student that goes to a charter school, the local district loses $20,000, but the district still

has the same fixed cost." guest: i will bet that that person is somehow associated with the school board association. both are all of the arguments that i have heard for 20 years, all due respect. the reality is, money in education, the money that we found our education system with is supposed to be for the education of kids. we should be funding each, individual child to get the best education available to them. right now, until charter schools came along, we were fighting so many systems. those school districts have got

to and learn how to spend their money for the kids that are in them. not just prop up a system. last year, there was a report that found the number of teachers being hired in the country over the 10-year period more than doubled compared to the student ratio than it warranted. that is why we have a bailout bill on the floor of the congress. we have fixed our money on people, not kids. host: what state has the largest charter school population? guest: california. there are over 800 schools serving roughly 300,000 kids. across the board, california, arizona has almost 500 charter schools. 215 or so in texas.

a couple hundred in new york. several hundred in florida. host: mountainside, new jersey. charles on the republican line. caller: please tell us of some of the disappointment that have been docummnted abouttcharter schools. guest: there are lots of challenges that the charter school movement has had and has overcome, which is the good news. they are not stuck in a fixed system. the challenges, disappointment, are actually phenomenally great lessons. we closed 15% of all charter " schools opened in the country because they were not meeting the demands of the people they were serving, they did not meet

the demands imposed by their state. i think that is a phenomenal record to be able to say, we have been able to put out of business these schools that were not meeting expectations. one of my disappointments, frankly, is that there are kids every day that we are not educating and their arguments, as you heard earlier, that these charter schools are robbing the public system of something. these are kids who we should be educating. as long as they are performing to the same standards, can prove that they are spending their money in the same responsible fashion, that should be the requirements. . .

guest: he is talking about sending money to schools regardless of whether or not they are succeeding. we have a lot more people than

we have students to fund them. host: a follow on what you said, because you sort addressed this before -- this person points to two media stories that came out in newspapers following the report i cited at the beginning. the study, bbt i, was commissioned by the institute of education -- guest: that is correct. host: within the department of education. c -- charter schools sometimes face the same problems as public schools. guest: again, you can look at this on a city by city basis, town by town, state-by-state. parents are absolutely going to face the same challenges educating kids at any schools. are they doing anything -- are they doing everything they can?

am i doing everything i can? are the visual learners, auditory learners? do they get out enough? are they responsive to me? we have got to get away from this notion that there is a one- size-fits-all response. when we look at the charter school movement, when it talks about public education writ large and what we have to do, we have to treat all of our students in ways that best meet their needs, not create systems that supposedly meets everyone's needs. we can move out traditional%+ public schools f, and some of them are, more and more towards freedom and flexibility and innovation that characterizes every ooher part of america. parents are going to learn how best to maneuver. host: the study also found that parents are perceived to be more satisfied with charter schools

and public schools. our parents -- our parents' record be more involved? -- are parents required to be more involved? guest: when you have the power of the purse to come up and evaluate whether the school works for the child, you are going to be more satisfied. the other thing, frankly, is that i was involved in every additional setting and i experienced this when i was growing up. -- i was involved in a traditional setting and i experienced this when i was growing up. let's say i'm at the program is not working and you cannot do anything about -- about. let's say a math program is not working and you cannot do anything about it. they don't have the ability to do that. there are rules and regulations for thousands of people and they cannot do that for every child.

this allows you it within reason to make sure what can we do to get the child to square one and meet his or her needs. host: keith, good morning. caller: good morning, ladies. what did you do before this position? guest: i have been in this position for 20 years. host: what did you do before? guest: prior to that, i was with the department of education and on capitol hill and was with the think tanks. host: did you teach before? guest: i did not teach. host: what brought you to this position? guest: my love of political science and my feeling that we were not teaching our kids what we need to know. we were not connecting with people locally and in states to teach the great ideas and different ways to do it. and the fact that i went to one

of the best public high schools in the state of new jersey and i still love with an education that i felt was under serving a -- i still left with an education that i felt was under- reserving me. host: what administration to do work for? guest: i work for the reagan administration. host: james, you are on the air. all right, i'm going to put you on hold. you have to bring your television or radio down. all the ways we get feedback -- otherwise, we get feedback. let me ask you about teacher authority, that teachers have more authority to can you explain that more? guest: in traditional public school setting some teachers are beholden to a contract or set of rules covered by contract, as well as by policies that are adopted locally by the school boards. it prescribes for the most part when teachers can come to work,% when they leave, what they are

all about and permitted to do in the school day, whether they can offer extra help, whether they can be available on weekends, whether they can do cafeteria duties. more importantly, in traditional public schools, they have little to say about the curriculum they have, standards they use, or how they apply the standards, some of the different to french agents and the classroom. in the charter school, when teachers by in and are hired, it is transferred from the get go, and they tended to involve not just in the teaching of the class, but the management of the school itself, they are consulted about what is happening, and they are considered professionals in a way that they are the first line of authority for what to do about the kids in the classroom. host: let's see is a james -- let's see if james is ready on the teachers line in wisconsin. caller: the last caller, still my daughter or we learned about this lady's background, coming

from the reagan -- this last caller sort of a possible whit - sort of stole my thunder, with this latest action,, forming the reagan administration did this race from the top by arne duncan is a continuation of the assault, were you based teacher pay on merit. i taught for 31 years and i work hard for a middle-class income, and i think that public schools are doing an amazing job in this country, considering the socio- economic conditions -- poor,, both parentsor, having to work to put food on the tables. not set schools are to the same standard as public schools. host: let's take that point there.

guest: i i do that they are held to a double standard, that they are having to demonstrate within five years or they are puttout of business but they are restricted in terms of buildings and supply and where they can set up schools. that is very important. this is a phenomenal country where i can be working very closely -- in fact, people work for me on a daily basis. we have people from the reagan administration, bush administration, clinton administration, obama administration coming together over education. this is not about politics or partisanship. this is about our kids. when we recognize that what our political hats down, one of the reasons i found the center, to bridge policy and practice across ideologies, and we had succeeded in educating more kids as a result. host: what is the center for

education reform? how are you funded? guest: a national nonprofit education and advocacy group. our money comes from private donors and supporters across the country, thousands of individuals, middle-class, lower miidle class, and high-walled individuals keep us going. host: do you make your donor list public? guest: we published our donors every year through our annual report. host: columbia, south carolina, independent line, stephen. caller: good morning, jeanne allen. it's great to hear you talk about charter schools across the country, particularly in south carolina. we are fighting the battle here and continuing to try to increase the number of charter schools we have, particularly among african-american groups to i want to thank the center for education reform for the work you have done in our state.

earlier, speaking about creativity and innovation -- if you could speak to that a little more. in south carolina, our law requires that public school teachers serve on local charter school boards, and many of them become intimidated and frustrated because they are intimidated by local school districts when they're being asked by community groups to participate. but many of them have great ideas about what should happen in the classroom with regard to education. if you could speak to those issues, and thank you again for what you are doing across the country. guest: thank you, steven. teachers are the single best, obviously, line of defense, and clearly, our weapon against bad education in this country but we just don't do enough to give them the authority and the ability to use their creativity in the classroom.

when you invite teachers to come into a process that allows them to create schools to other --%- create schools together, they take what they have learned in experience, not necessarily in ed school, and they put it to use. eight end up getting hired or boards. -- they end up getting higher rewards. the kind of creativity going on in charter schools today and the way they do the work aad the amazing graduation rates coming up, or particularly for minority kids, is amazing in places like south carolina. host: it is the headline in "the chicago sun-times" this morning, "teachers so good, they're gone." is the economic situation having an impact on charter schools,

having to cut back and let teachers go? guest: it is. they are going to cut lots of things we would prefer they not cut. there are bills in every single state to cut charter schools, even though they are already under-funded compared to public schools. what is really at issue today is the pension liabilities, which are extraordinarily, if we can do eight and a great economic era -- if we can do it in a great economic era. teachers will have to face early retirement or cuts in the pension, sadly, like every other industry. host: last phone call, republican line, shelby. caller: i am going back to school today. i am the school nurse at our charter school.

we have 130 students and just graduated 100% of the senior class. we are a mix of cultures and races and achievement abilities. i think i did hear complaints from somebody that they wished we had more students in the middle category, because we had so many high achievers and then we have lower achievers. be that as it may, our building is an old store, and we are not supported by the local board of education to be our eyes state -- we are not supported by the local board of education. we are eight local charter school. we finally got almost the right amount of funding, but i still the we get funded like the local schools do. -- still don't think we get

funded like the local schools and to bring out director is out of a separate public education. i did not see students in sixth grade with all the same textbooks. i don't see that in our schools. but we have thousands of books. my mother taught 29.5 years in public schools, my sister is almost as long, and my daughter in law is teaching. i don't think that education for any child is going to be very good until we get the families back together, because you need a good family situation to support the child at school. guest: next to a family, the research shows, and it is very clear, that teachers -- the family is the most important thing in a child's life, you are right -- it can make a bid of

-- the teacher can make up the difference between what the family is not providing and what the student needs. charter schools in georgia are overwhelmingly successful. studies show

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[captions copyright national cable satellite corp. 2010] [captioning performed by national captioning institute] number 11 shows that the new u.s. counternarcotics policy is held across the department of state and the pentagon and the white house and deficits on counterinsurgency are really the hol mark of the new

administration policy. with that, i would like to turn it over. >> drug markets are very complicate and full of consequences. afghanistan is extremely complicated and jonathan's job is to take these two systems and make it all clear by laying out some of the key facts. my job is to come along and give you the sour grapes and bad news. before i do that, i want to say all of us have tremendous respect for the people on the line risking their lives, implementing these programs and we are not in any way, shape or form, opposed to drug reform across the board. that is not who we are. that is not our message. the message is that afghanistan is different. so the thinking that we

understand about drug control gets turned on its head in afghanistan. someone once said follow the money. today i think the point is we should pay attention to the money. usually you think about the number of users and the quantity used. those are what drive the overdose. you design your policies around the amount of use. but we're here today to talk service -- counternarcotics in the service of counterinsurgency. there it is the money. it is several billion dollars which doesn't sound like a lot compared to the world market but it is a lot in afghanistan. the fundamental insight or

punchline here is that when you shrink the amount of opiates that are produced and exported from afghanistan, you actually increase the money that is going to the christmas in afghanistan. criminals of all sort. some are drug trafficers. some are warlords. some are the taliban themselves and none of them are what we would want to enrich. it plies to conventional enforcement. now most people when i say that say that can't be. if we eliminated all the production in afghanistan, then revenue would go to zero. that is true. but the point is the relationship is very nonlinier.

if you don't have the slide it is not a complicated picture. it is a vertical axis. is the money available? and the horizontal line, the quantity produced. if you start today with 100% of the current level of production and you work really hard and are lucky and you cut that production by 5% or 10%, or everything falls in place, maybe even 20%, you're still on the right hand side of that hill, to pulling back actually increases the money that is available to the various criminal element in afghanistan. so why is this? why do we have this hump-shaped nonlinear relationship? opium is a cultural commodity.

and if you spent time in farming parts of the country, you know how farmers react to bumper harvests and they don't celebrate. when you have a bumper harvest, all of those good hit the market and prices drop and farmers make less money thaa in a normal year. and it works the other way too. if there is a below average harvest revenue goes up quite a bit. that's the homier farm based intuition. effectively afghanistan is the monoon louse. they have 95% of the market and are the lowest cost producer and for various reasons it tends to stay where it has become established.

small reductions in quantity generate big increases in price. that after all is the motivation for opec. what opec tries to do is to have all of the oil exporting countries limit their production in order to keep prices high because it would bed a vanttiges them. it is hard -- be advantageous to them. countermarkets interventions in afghanistan innsome sense solves the coordination problem for the drug drafficers and increases the -- trafficers and increases the revenues. the money, the revenues is just the price times the quantity. the bad news is the price goes up by a larger percentage than

the quantity goes down. the reason has to do with the tremendous escalation in prices. normally the prices for heroin come out of afghanistan is about $2,000 per kilogramm if it yields $4,000 per kill gam? that's a $$2 per gram increase. it is lower in iran than in russia and lower in russia than in europe. you might take it as a ballpark average that it is about $20 per gram so maybe you're pushing the price up by 20%, to $22 per gram. as the prices cascade, you get a bump up and maybe it is a $4

gram increase for the users. congress has actually studied how drug users respond to the price increases and the good news is they actually do use less when the prices go up. it might give you a 15% less con sugs in quantity tiss -- con assumption in quantityities consumed. that is a good deal. you sell 15% less but at twice price, your revenues go up a whole bunch. that is the explanation for the hump-shaped relationship between production and the revenues. if you could pull all the way back to eliminating production altogether, you would eliminate the drug revenues, of course. that is not plausible. it would be hard to do in the best of circumstances and

afghanistan does not present the best of circumstances for the people working on those programs. when i tell this story, i'm telling a story out over three to eight years. this year's price goes up, feerms react to that price -- farmers react to that price and plant too much. 25 years down the road, afghanistan is a stable middle income country with no corruption then perhaps the opium production could go someplace else. it is applied most directly to the opium production. the refining generates more money, it is not so obviously impossible that you could kick

the refining stage out of afghanistan and maybe push it into pakistan or some place else. you want to point out that caveat. that is the big sour grape. unfortunately i still have a little bit more. the two main stillers are alternative development and enforcement. they have some other rarely appreciated downsides. with eradication, the downside is you eradicate a farmer's field, they get angry. gives them sympathy for current government forces. we have realized that and adapted to it. with alternative development, one of the basic challenges or risks or realities that is so frustrating is that some portion of those development

dollars goes directly into the pockets of the criminal that we would like not to enrich. when you make a protection payment for permission to drive a truck down a highway or do something else, that production payment is not going to responsible government parties. exactly who it goes to depsd on the province or the context. some people are worrying about a 10% or 20% tax on certain programs and if you multiply the budget by 10% or 20% , you get a number that is not so small compared to what we think the taliban is not making from the drug trade. there is another twist. i perhaps misled you a little bit when i said the money is priced on revenue. not all of those criminals are equally troublesome. some are straight-up criminals and some are warlords around

some are tall been a. what -- taliban. what fraction of that goes into the nastiest of nasty? for reasons that are not clear, it has not been all that successful at capturing a large fraction of those several billions of dollars, and so, if you upset the apple cart and move that market around, it could get worse. and in fact, when you just increase the intensity of enforcement, you have to think about this. which kinds of trafficking organizations are disadvantaged? and which ones are advantaged? it would be the most powerful organizatiins thaa have the ability to corrupt and intimidate law enforcement.

they may benefit if the less powerful organizations are the target of the enforcement and so overall, aggressive enforcement that isn't very carefully targeted may end up empowering the organizations that are most capable of intimidating or corrupting the source of information. i apologize again. i don't normally like to be sour grapes. mark will give you something that i hope is a little bit more uplifting. >> thanks, john. i'm the bringer of the good news. so the bad news, as we just heard, is that our current policy, counterattacks policy in afghanistan, we're mostly banging our heads against a brick wall and the good news is that reportedly it feels really good when you stop. so i think we do have some

really straightforward things to do, which is less things are hurt us. there is a story told about president coolidge. coming out of church, someone came up and asked him about sermon, what did the preacher talk about and coolidge said sin. he was against it. and as jonathan kulich pointed out, it is wise that we should be against drugs. heroin growing in afghanistan is bad for heroin addicts and their families and their neighbors. it is bad for the afghan government and good for the taliban, and therefore, it is said, since drugs are bad, counterefforts are good and if some is good more is better. there is a widely shared piity

that drugs are bad and we should do more to fight them. you'll get lots of head nods about that. in particular, it is claimed that since the taliban makes money off the drug trade, counts narcotics is -- counternashts is counterinsurgency. the natural result of counternarcotics efforts is to increase the flow of funds to dealers and to increase a share of those funds going to insurgents, warlords or corrupt officials. every enforcement action accuracy loser. somebody gets arrested. somebody gets sent to prison. everybody else in the trade is a winner. they just lost a competitor. he bombed all the ford plants

chrysler would be happy. as john kulich pointed out, the winners are likely to be the people with the muscle, whether that is military or armed force or corrupt influence. the winners are going to be the people best placed to resist enforcement. it increases the ompetitive edge of the worst organizations. and, again, as has been points out, tends to concentrate drug activity where the ackstivet weakest. you'll see lots of people boasting. 27 of the 34 provinces in afghanistan are -- free. we can be proud of until you %-

realize that that means the other seven provinces of afghanistan now produce virtually the entire supply. my kindergarten teacher r told me you should always offer constructive criticism. so we do have some ideas. the natural tendency for enforcement is to -- the worst bad guys. the f.b.i.'s concentration to have mafia meant that the mafia never had a piece of the cocaine trade. we had a large group of groups and they just never got

a piece of it. it was too dangerous to do with it. the f.b.i. was so all over them no cocaine dealer would have anyyhing to do with afghanistan. look, there is opium that comes from the taliban and opium that doesn't come from the taliban. if you're selling the wrong stuff you'll be the focus of attention. the groups that helped us throw the taliban out, a trade association, it was a natural association of heroin dealers and yet those same warlords are perfectly happy to sell heroin on north and central asia. you can imagine going to one of those groups and saying we're paying attention to your

sources and whichever exporter is selling the most taliban-taxed heroin is going to get our own divided attention. that would require knowing where the stuff came from. probably not beyond the state of the art but beyond what we're currently doing and the capacity to actually target enforcement, where under afghan conditions may be complicated. the problem is that it opens up the door to influence and corruption. how you distinguish targeted enforcement from corrupt enforcement is not so easy a problem. we could fight corruption. corruption is not ambiguously bad. it would not be a bad thing. if we can't replace the corrupt government officials and replace them with honest government officials that would

be a good thing. it is not clear how much capacity the u.s. government has for that or how much tolerance the afghan government would have for that. concentrated enforcement is an endeucement to corruption. there is only one agency doing the enforcement. the officials in that agency have a valuable license to sell. think about drug enforcement in the u.s. local agencies all working the same account. trafficers who buy protection from the local police chief suspect buying all that much and the f.b.i. is looking at that police chief. if there were many efforts in afghanistan rather than one, each one of them might be less corruptible. that is recommending a change in the government that we don't have a direct exaps to bring about.

-- capacity to bring about. we could do what i would call royal development unbound. not alternative development. not bribing people not to grow -ppoppy. all we can do is move it around the country. wep it in overbly we don't want it in places that the government doesn't control. we could do developments the right way and that would tend to focus it in the areas the government controls. phere you're not paying the taliban tax rather than in the dwrr government -- area the government does go. poppy brings the alternative

development money in. so if we uncoupled the development frufert the hopeless campaign -- effort from the hopeless campaign and make ourselves some friends and finally, demand is good. all of the trafficers lose if people use less. it works eeen a little bit. that's better than nothing and the sign positive with respect to generous urgency and also a gesture might make us some so those are all, i hope, construct i ever suggestions and i also hope iver been clear on how limited the capacity is. i'm a little bit worried if we focus on the suggestions and if we keep doing what we're doing, which is ostly -- even if

there is not much we can do, that does more good than harm. that is not a reason to keep doing stuff that does more harm than good. wall available as an alternative is not a reason to be doing it. the point is to stop. our overwhelming recommendation, on top of doing these useful things, if we can learn how to do them, is to do less than what's hurting us. now, that will lead to complaints from iran and russia. indeed, the cutback in eradication. it also has led to substantial putbacks from wasia to iran. what the u.s. has been saying to mexico and columbia. which is why are you not solving our drug problem for us

and we're in the position of responding the way the mexicans responded to us, which is why don't you stop using our drugs. but it is in fact, the case, if we did the price might fall. if the price fell, consumptiin might go up. a 50% increase in price in afghanistan might lead to something like a 7% to 10% increase in consumption in iran or russia. one thing we can do is help the drug prevention and treatment efforts. iran has been quite aggressive with drug treatment because of its enormous problem. russia has been less. they are in a primitive drug war phase. we have to exxect that any cutback will lead to criticism. it is not clear to me that we

ought to be taking advice about policy in afghanistan from somebody that would love to see a sale in afghanistan for somewhat different reasons. so our current countermarkets nols afghanistan provides -- policy in afghanistan provides material support to afghanistan. that's our basic conclusion and basic advice is to stop as much as we can or at least do less of what we're doing that is harmful. if we want to break the momentum of the taliban, well, a good place to start would be to not fill their coffers. that's our story and we're sticking to it and now to tell you the actual truth is phil heymann. >> as he comes up, you can see

with this study, that was supposed to be the good news. this is also why we have him here to present a view from the administration as well as others and they will have their opportunity here very shortly to give their thoughts on this. but before that, professor heymann. >> i am about 10% as good an economist as any of the three and that worries me a little bit about giving my thoughts. but on the other hand, economists led us to the economy that we now have and sometimes they are wrong. indeed, often they are wrong. and the question that i want to put to you and to them is how sure we are of what part of their conclusions.

john caulkins said the drug world is very complicated and afghanistan is very complicated and when you put them together you get an extremely complicated situation. in fairness to the authors, they ever just -- they have noted that they have to be modest about their conclusions because of the complication of the situation. but they have fairly simple, straightforward, general principles to apply to a very complicated situation. their argument goes, there is an extremely simple-minded answer which they are rejecting and that is drugs are bad to counterdrugs are good. they have moved us to an

intermediate level where they are applying macroeconomics intelligently to the problem but there is a ground level where theya admit, to a good bit of uncertainty and that is the area i'm going to be exploring with you a little bit. ok. it gives me pause to think that if we ask the taliban to vote on whether there should be reduced drug production that they are taxing, they -- we're being told that legitimately they would answer yes. we do think the drug production would increase their tax revenues. their position would be exactly the same as our present position. that is pretty powerfully

counterintuitive. let's see why they might really want to object to an increase of law enforcement against their taxation of production. but let me step back first and say what i think is strong and what i think is weak. the argument of the panelists is that there are only two real reasons why we might be going after drugs in afghanistan. one, to reduce the drug problem and two, to reduce the insurgency problem. they make a case that the argument, that either of those will take place to a significant extents is very weak and they have convinced me of that. the result of that is to say we shouldn't be paying much

attention to drug enforcement in afghanistan. i think they take the argument further and say that -- i know they take the argument further and say indeed, we are harming ourselves, both in the drug war and in the war against the taliban if we engage in drug enforcement. that takes it a little bit further than i'm comfortable going with them. now, let me just state why i find a more modest version of their argument convincing. on drugs, i find the modest version convincing because there are so many alternative locations to grow the drugs inside and outside of afghanistan and because demand is very intelastic, even at the

retail level and the effect that takes place at the growing level, which is a tiny part of the growing price which will not have much effect. so i don't think we can have much effect on the drug problem, even if it were our problem rather than europe's problem and russia's problem and iran's problem, i don't think we could have much effect on it, much for the reasons they say. by drug enforcement in afghanistan. on the other hand, as they pointed out, in those areas, in those 17 provinces that are largely free of poppy growth, it wouldn't take much as mark kleinman teaches in his book, as bill referred to, to keep +

them poppy free. i would certainly keep them poppy free. the questton is how much attention should we pay to stopping the poppy growth and sale from the seven remaining provinces? and i think they have made the case that as a drug issue, it doesn't make an awful lot of difference. by the way, not just our growth possiblies all over afghanistan but they are all over that part of the world throughout all of the stans you could grow poppies in very large quantity tiss and you could move them -- quantities and you could move them easily. i find the modest form of argument that this is bad counterinsurgency law a little weaker and that's the part that i wonder about. at one point that arked that drugs constitute only a very

small part of the taliban's total revenues. but there is a cost to replacing them with dependence on other countries and dependence on wealthy, more moderate countries who might make demans in exchange. so that is not a total effect that that $70 billion could be replaced out of so you hadi coffers. it -- out of saudi coffers. it doesn't establish that it is a good form of counterinsurgency to make them rely on saudi. and the second part of argument is -- this is the part that troubles me. they make me nervous because they are better economists than i am. is that if you increase their -- the costs of production by

law enforcement in the seven provinces, let's say by -- i don't know, $100 a kilo, a kilo. that that will result in an increase in price at retail of at least $100 per kilo. i'll buy that. and a reduce in quantity that is less than proportional to that increase in price. the result, a decrease in quantity is less and the result increase. total revenues will all of that, by the way, tends to ignore, i'm sure they thought about ittbut they haven't written or told us

about it. the very large stockpile that jonathan caulkins said the large pile of opium waiting there to be released. but increasing total revenues doesn't necessarily increase the take of the taliban. if the taliban has to provide protection, which at a cost, which passing through increases total revenue, they will get greater revenues, but not necessarily greater profits. now that's the place that i'm troubled and i would like to hear from you guys about that. everybody with me? in other words, there will be greater revenues but there may not be greater profits. ok.

if it -- if they are right about that, now i really feel like i'm stepping off in deep waters. jonathan caulkins is right and mark kleiman about the desirability of having a bad crop, why don't wheat farmers demand an increase in taxation of wheat to raise the price? i'm asking the question -- jonathan caulkins said afghanistan is different. but what makes afghanistan different in that regard? and why isn't there strong argument, and asht against law enforrement in every case? against -- because in every case law enforcement will raise the price of -- of something that seels on an inelastic

market and at least if it is a commodity like opium, it will increase the total revenues. if they are right, why is the argument much broader? they may have a very good answer to that. it is probably going through your minds too. so i wanted to ask it. there are -- their whole argument is based, as i think it fairly safely can be based on the advantage to the taliban of getting increased revenues. i just raised the question whether they will get increased profits when they get increased revenues. i've answered that question. let's assume they did get increased profits. the -- pursuing law enforcement

-- when you think about what to do with an organization like the taliban or al qaeda, a good starting place is to think of all the things they need to offer it. besides resources, they need havens, weapons, popular support and absence of informants, knowledge of the line, plans, opposing plans, leadership, recruits, hope, intimidation capacity, corruption capacity, communications, outside alliances.. there are not so many. i just read through a lot period of time you won't be a lot. you won't be able to think of many more things they need. revenues increase with law enforcement. law enforcement may decrease the availability of recruits. it may be that planters of

opium, or the families of planters, are a ripe source of recruits. now again, that will turn out to be a complicated story. but you'd have to really ask the question. iim about 90% with them on this. you really have to ask the question, besides revenues, what does law enforcement do helpfully or harmfflly in terms of all the other things that the taliban needs. the -- and then finally, i'm left wondering how much of a difference -- i'm -- i'm wondering how much of a difference in actual plans on the ground their argument will make? again, i'm interested to hear their reaction to this. they don't want to stop

whatever law enforcement is necessary to keep 17 provinces opium-free. so that won't change. we have a fairly small capacity to fight the drug trade on the ground in the other seven provinces. we'd have to pursue counterinsurgency in other ways first. what is it exactly that they would change, except the spirit of -- the american spirit of hopefulness, which in this case, may be somewhat ridiculous to think that we will have a major effect on the insurgency by fighting the drug war in the place where it is hardest to fight. where the surplus of drugs is already immense and from which

the drug production can easily move elsewhere. ok. [applause] >> you will have an opportunity to answer professor heymann's questions but first let me invite the head of the white house office that deals with these issues to make a couple of comments, obvious questions that have been raised by the study, i think, as we're -- be very pleased to have you here. i'm going to ask you if you would like to say something after. >> sure. thanks very much. first, i very much appreciate the institute hosting this and putting this together and the work of john and jonathan and

mark and also phil's remarks about the piece. i think for these people that don't live and breathe the drug policy issue every day and particularly in afghanistan, you have been very helpful in explaining just how incredibly complex this is. the other part i appreciate is that you have been able to -- to distinguish among various countries that what perhaps may have been somewhat effective or more effective in mexico doesn't necessarily mean that same strategy is effective in colombia or effective in afghanistan. i think there are some other things, though, that are at play in this very dynamic and very fast-moving environment, as especially with the change of command in afghanistan and the fact that the policy, as

the president has said, would remain the same. we had the opportunity to work closely with ambassador holbrooke and work closely with a number of people to write the counternarcotics strategy. the other part that i think also deserves mention is the fact that there is government-led eradication to some extent within afghanistan and there is also the good performers initiate i ever that rewards those promises that have produced considerably less. the other part is i think it isn't just the united states that has a new look or a new format for policy, which puts far more emphasis in the areas of prevention and treatment than merely law enforcement and criminal justice. it is also that a number of institutions, a number of nations around the world are

also approaching their drug problem in a muuh more balanced way. as we engage very quickly after the two presidents, obama and medvedev met to have a work group with russia on drugs. it wasn't just about drug trafficking and heroin being produced and coming into russia out of afghanistan. it was also how could their demand be lowered and how could you deal with a very large addict population. i think you bringing this to the attention of truly the world community about the problems and the complexity about one that is appreciated by many of us that kind orp live and breathe drug -- f live and breathe drug policy every day. thank you very much. [applause] >> thanks. i just wanted to mention first of all that before i came to

work at the state department, i was working at the center on international cooperation at new york university, which is the sponsor of this study and my colleague jake sherman from c.i.c. is here with me. we started this project. the first result you see before i joined the government. it was the result that was an extension of work that he had previously carried out on insurgency and counternarcotics in afghanistan because we were very concerned that at that simple equation that mark mentioned earlier and particularly i want to bring up one point that jonathan caulkins made very clearly, in the political context, it is the money rather than the drugs per se that does the harm. we felt that had not been incorporated into the policy analysis. we decided to go further than we had done in our previous

work by trying to find some real experts on policy analysis, particularly policy analysis of law enforcement, drug markets and so on. that. however, that said, we had no control over the outcome of the study. now that i'm in the government, of course we welcome the findings but my presence here doesn't mean that we endorse them. nonetheless, the president has said that our operations in afghanistan and pakistan and the region are the most important national security priority. that means not only do we have to devote more material, money, people and resources to it but it also means we have to keep thinking constantly about what we are doing in this complex situation. this analysis will be a great help to us in doing that. of course the real test will be the results on the ground and this analysis will help us to analyze them but it won't substitute for them.

i do thank panelists for a very provocktiver analysis. i would like to clarify two points that i should mention. i want to thank heymann for some comments. he made some reference to saudi assistance to the taliban. the government of saudi arabia is an important partner to the united states in combatsing terrorists and financing for the taliban and this has been increasing over time. it is one of the best partnerships we have. it is true that there are private individuals there and other countries in the region that do -- a we do make such contributions and finally, the administration in addition to moving away from eradication, has also moved toward a development policy such as mark recommended that is not tied triple digitly to alternative development tied to alternative

development. the united states had allocated more money for opium. that is no longer the case. we have a huge program on agriculture that is targeted at the entire sector. thank you. >> thank you very much 3789 professor phil heymann asked a couple of good questions. as you formulate your questions, and we'll invite you in a moment to ask them. a couple of questions, would the taliban object to reduced production if you asked them? if you increase the cost of production rever knew goes up and would profits -- revenue goes up but would profit go up is the question? why don't the farmers ask for the help? revenues do increase with law enforcemenn is the kinddof question and the then the interesting one as well, what difference on the ground would your recommendation be?

>> first i should say, it is true that economists have massively messed up the economy. fortunately this piece of economic analysis was done by three people, none of them has a degree in economics. mine is in policy analysis and john is good at economics but his b. scrmbings in physics. none of us are to be blamed for the meltdown. why don't we farmers ask for reduction? we do. that was the whole great new deal. culture policys is to cut back on production to support agricultural prices. sugar farmers want tearives.nd - -- tariffs. would the taliban want less production? well, it is complicated.

one thing is that they want want less production where they are. this is a point that john and don't actually see perfectly eye to eye. the government the paying people controlled by the government not to grow poppy so it can be grown by people taxed by the taliban. i'm sure the taliban would hate it if they started growing poppy in the north. at the moment we asked if we would hate t. there are governance issues about that. i'm not sure how that comes down. but with respect to enforcement within the taliban's own area, the more we enforce it the more the farmers are dependent on taliban production. i'll leave my colleagues to handle the hard questions. i learned professor heymann's easy questions are hard enough

for me. >> why different for taliban than wheat farmers and why law enforcement has anfect there even though it doesn't elsewhere. you only like the contraction if you are a small producer with lots of other producers you don't want somebody to come in and shrink your supply. afghanistan really does dominate global production. 90-plus percent and that will remain for the next five to 10 years. phil made a good point. let me answer by pushing the metaphor of taxing. we use this term, the taliban taxes the trade. it is not a statute in afghanistan that defines a specific tax rate. let's use the metaphor for a minute. if the character of the tax

were an excise tax so they got $500 per kilogram then shrinking kilograms would shrink the revenues. it was were more line a sales tax then shrinking the production drives up the total value of the market and hence what they can tax. so thank you to phil for forcing us to make explicit and implicit assumptions that there are images, one way or another the taliban are going to capture a share of the total dollar flow. not that they are not taxing like an excise tax. i'm also really glad phil asked, gee, doesn't the logic apply to all law enforcement everywhere? the answer is no. here are two crucial differences. there is this technical economic term about the

elasticity of demand. it has to do with how prices go up and down a little bit. i tried to explain that that key parameter for the export from afghanistan is only maybe 1/5 as large as it is inside a final market country like the united states or england and that's a crucial difference and it has to do with that great inflation and the value per kilogram as the drugs move down the disttibution chain. so that crucial parameter is much, much less favorable to law enforcement back up in afghanistan than it would be here. now the second reason why law enforcement looks a little bit different is when you squeeze on supply, you're going to do pgod things to the quantity si consumed and and not as good

things, perhaps even perverse things to the total dollars. most of the time when we're thinking about law enforcement in the united states, we're willing to maybe not make progress on reducing the dollars if we're making good progress on the quantity being consumed. . but when the united states is thinking about afghanistan, the kilograms produced doesn't very directly affect dependent people in our country because the heroin market is more hemispheric than global. most of the heroin from the eastern hemisphere stayed in the eastern hemisphere. we get most of the heroin from the western hemisphere. we don't like regular criminals in the united states to make extra money but to the extent that we dislike extra money going to taliban insurgency may be even worse. >> which is not to say that the majority of u.s. drug

enforcement is well -- if we had half a million drug users in prison most of the difference is we would have fewer people in prison and not much impact on drug consumption. >> a subject of another discussion. any response before we go to questions and if you have questions you can please stand right up here. >> this is a question, not an argument. if it is not the quantity produced that goes down, obviously it would be some of both, but the cost of producing that that goes up, by having to hire guards or having to pay more in the way of corruption, does your logic continue to apply then? >> no, and phil, i'm really glad you brought that back. you had said it before and it

is a really good point. it is easy perhaps to think eradication, the amount of opium coming offer the farm, so right now, the people who are producing the heroin collectively are spending $80 a kilogram for the opium they buy frr from the farmers and sslling the heroin at $2,000. what happens if they have to fay farms more, $150 a kilogram instead of -- pay the farmers more, $150 a kilogram instead of $80. what if they just ate it? and that cost took away from the profit, then the analysis -- that changes everything. the other implicit assumption is that this distribution change like most distribution chains will pass on price increases and what you can come

back and say to me is well, do you have direct evidence of that? can you point to it? and the scenes no. our systems -- answer is no. our systems are not adequate to say we know for sure that chain does pass along price increases. we have a belief based on how distribution chains work in general in the legal economy and in illegal distribution ccains. >> one other question. what difference on the ground do your conclusions drive you to? >> focus on corruption. this foreground is corruption rather than just a background.

figure out how to do the targeting. i'm sure there is a lott targeting going on but what this says is that the non-targets enforcement is worse than useless. it is actually helping the bad guys. so let's not do any activity that we have reason to think it is somehow supporting something bad. it raises serious questions about whether we want to keep poppy out of the regions where it is now not grown. i don't completely agree with john on this. the analysis raised the question about the government-led eradication. and -- and the implication about prevention and treatment. as we were sitting there, one operational thing we have to do is respond to russia and

iranian complaint and i think this gives us something to say back, which is partly well, how is your -- >> very briefly -- in as much as we're a little dour on the consequences of the drug policies, it raises a question. we may in some sense be giving permission to folks making policy to think about symbolism. this relates to phil's comments, is it only the money? fundamentally it is only about hearts and minds. if some direction can be pursued in a way that captures hearts and minds, we're seeing you're not going to be to -- you're fwree to think