i asked the secretary+ of transportation, how many carrierssreally constitute competition in the marketplace?. well maybe three, he said. that is where we are headed. and thht is not good. . .

is something that keeps the company alive and keeps capacity in the market. so that is the high barrier to exit. >> seconddy, you analyze the industry and its competitiveness for a living, when you stand back and look at it, here is a very profitaale industry for a lot of -- not for the airlines, but for the auto rental companies, the hotel business, for all kinds of peoole. all kinds of peoppe have figured out how to make money from people traveling, but the airlinee do not. but for some reason the center

of wall seems to be among the $68 billion figure. what s different about that segments of the overall aviation transportation business that else is doing ppetty well, or at least seems to be doing better? >> ttere are several factorr that contribute to the poor financial performance. one is that the industry has a very high fixed cost structurr, so as we move through economic cycles, they cannot cover their costs with the revenue they can generate given the amount of supply and demand in the market. it issas simple as that. if you look at the managers that are required and the debt baked into the companies, they have over leverage themmelves, and+ interest expense that they pay on assets, aircraft or the

aircraft rental fees they pay, contribute to the high fixed costs structure. to finance a business, which is highly asset-intensive is expensive. when you have a structure that does not generate enough reeenue to cover the costs, the cost of capital, meaning ttat tim!!the t expense goes up. that is the irony of all of this. one of the drivers will be the cost of capital. the more financially stable, the lower the cost of capital will be, which will then provvde a lower hurdle for growth. >> one last thing. you assumed if there was a huge3 just a few global players, they would have more pricing power in ticket prices would go up, and they would make money. that prices have been steady or

even declining. it is an increasinggy better by for the traveeing public. what is wrong or will thhre be appalled at that end of cold? >> to reply to that specifically to this merger, i think a much, if you liiten to what the companies are arguing, is they think they wiil get a better share of the corporate traveler, which is a higher yielding companies, which will improve their mix and improve their yields. when you look at the competitive structtre, it is important too look at it hold mystically in globally. certainly domestically there is low-cost competition. internationally we have seen college sedation -- consolidation in europe. british airways and iberia emerging. and that america there is ooly

one airline outside of brazil that basically controls the whole region. that is land chile. in china there are only three major carriers -- air china in in china eastern in shanghai.one they have been consolidating. part of the analysssshas to be that companies here are going to be competing for international travelers against those foreign enttties. i think that is something that we should noo ignore. >> thank you, mr. petri. the chair will now recognize himself. during the ttstimony of mri raid the issue of what happened with the employees, and judging bb+ the prior experience with airline mergers and what has happened to employees, and mr.

rocheeraised an experience that he has been through, i understann there is a lot of uncertainty about the future of our merger of oofloading awfulland i also raise the point if their work, as this moves forward, is there are agreements that can beeworked out with the unions, is certainly would make this a much smoother pasth to te merger being approved. i want to know, thus far, had you been at the table as far as the merger has been discussed? what have you learned?

what are the answers you re waiting for? we will start with capt. morrison and go down the line. i want to know what has happened so far, and what do you want to see happen? >> we have started the process. we have negotiated an expense reimbursement provision that is not quite eeough, but a step inn the right direction.+ we do not think the employee should have to pay for the expenses of the merger. it is the ceo's had decided they want to merge. that was a step in he right directiin, but a very small step. we see indications that the management is interested in doing the right thingg but until we actually see what they proposed at the negotiating table we're working on a transition agreement. it would e more of a standstill type of agreement.

as we process down that path, there would be a joint coolective bargaining agreements and whether we get to that quickly will be the indication+ of how well the merger will go. if we do not get too quickly, the worker -- merger will be unsuccessful. as we proceed down the path, we see great opportunity to lead, buu weecannot leave by ourselves. we must lead with the management of the companies as we make it a successful merger. ww see the right steps, but time will tell wwether the steps are really taken. >> i would agree with capt.. morse.

it is so far since may 3 when phe announcement was made. we have seen hat steps by management that would lead to cautious optimism in terms of information shariig, in terms of working towards a transition agreement. i will say that the piiot groups are working very welll together. we have outstripped our management counterparts. it haa to be as a control order. there has to be a certain order of things to occur that we have agreed upon. we'reegoing to negotiate the transition agreemmnt, and once that is complete, we will move to a transitioo agreement. each of those steps will be

test for management groups to ensure they are participating in good faith. if they do ot participate ii good faith, then things will not if things do not progress, they do not get synergies and meet3 commitments. it is very much in the hands of labor. and the management counterparts working together if this will >> i am afraid we have no optimism at all. we have been at the bargain in -ptable with this management tem on an open agreement that was reached in bankruptcy for well we have made no progress. the company has not moved on their ooening concessionary proposal. since they have announced a merger, they have been unwilling

to discuss with us the expense rrimbursements for what it will cost the employees to participate in putting the merger to get there. they have been unwilling tt talk t us about an expense agreement, which allows four separate operatioos while we work through the issues. they have been unwilling to merger, other than to provide us with informmtion that is pubbicly available that we could simply read in the nnwspaper. a very difficult labor- management relationship. it has not improved. nor have the executives of the united airlines given us any indication that they would like any synergies that they hope to get from a combined flight attendant work ffrce are very happen unless here is a change

in attitude. >> thank you. mr. roach i know you were shaking your head immediately when i started asking questions. bargaining relationships on both carriers. we ave met separately and ww have both asked a lot of questions. thee do not have answers. they have been willing to meet and they continue to say they will give us the answers. our coocerns are about pensions. we worked very hard during tte bankruptcy to maintain pensions. we worked very hard to maintain a single employer plan. there is a lot oo work. thereeis a lot of work and try to go through the process. they have not started, and said

they have thought about it but do not have answers. we are concerned about the regional partner. what happens to them. we are concerred aboot thh overall business plan. this is not too big to 16succee. again, north west delta are not together. there are big problems over there. the orale is down. employees are not happen. -- ar enoe not happy. we want to see the business plan. we ask for the information and they have said it is forthcoming, and we look forward to it. we want to make sure carrier can survive and be successful. having a good contract and no job needs nothing.

-- means nothing. we want to see that things survive. >> thank you. i cannot emphasize enough power important it is that these issues are worked out. i will deal back -- yield back ann now recognize tte gentleman frrm ohio. >> thank you, mr. chairman. i have a quick question for the gentleman who seem to be on pheir testimony. if you could balance this out with your comments. in your conclusion you said the ability to generate more consistent returns in return cash flow nd long-term

financial stability. however, there is a very3 that any merger between network airlines will produce a modest connecting revenue gains. can you balance it those commens out? >> when you look returns of the company, you have to starttwith revenue. and you need to think about what drives revenue, and what drives revenue is supply and demand and price. what is clear to us all is that thh revenue has not been sufficient to cover the costs, operating costssof thh business in the interest expense of the business, so there have been losses. the companies have borrowed more anddmore money over the years.

as the balance sheets become offborrowing in theecost of cost equity rises. that constraints growth. the hurdle rate for growth becomes high year so growth becomes more difficult. >> please explain to me how reducing the number of compptitors actually increases competition. >> i am not arguing that it does. >> i think you have summarized my argument well. the core rgument is that this is good for consumers ann the long-term of the industry because it will create measurable economic benefits in terrs f network synergies or cost reductions.. i believe both of those claims

are fundamentally false. i believe if you look at the historical record there is no evidence of anyone else having found this. i believe if you look at the historicallrecord of how the networks work, you can create network synergies in a case where you build up a large hub. you can create networks synergies in an environment phere the merged carrier assembly as a new ability to grow into new markets indeand expand. there is no evidence in this cass that they'reegoing to do any of those links that would enhance legitimate networks the cost of puttiig the compaaies of the size and these levels oo complexity to the other runs into the billions.

we have already heard plenty of testimony on the collective bargainnng issues that need to be resolved. those are expensive. equallyyimportant are the maintenance concerns ann the safety concerns raised by people today and other financial infrastructure. thoss costs are 100% certain. they occur right away. do you save because you do not need two general counsels, yes, bbt that is pretty trivial and down the line. all of united has claimed astor -- united has says it will cost reductions. any person with common sense would look at that and say that is what the pr guys are saying before the collective bargaining

you have done the hard, messy work of integrated maintenance systems. chances are the cost synergies will be a big negative number. >> do you think previous mergers witt the unintended costs that have been added have blood to farming out some of these routes and some of the domestic routes to low-cost arriers? >> people were discussing the american/twaa, which were the exact synergies we are discussing today. equal 3. no one in the government scrutinize that. that is the message to the committee. the issue for the committee iss

confidence that the doj will run through the very critical efficiency claims. if they're proven to be true aad they have found opporrunities that every airline manager failed to find and that continental manaaement has been saying they do not want to do a merger because it is too risky for our shareholders, he has found things that his previous+ management could not find. if the synergies are honestly there, fiat firebauthey should o proceed. if those the efficiency ouies ae not there, it begs the questions problems? >> can we take a simple example and the elaborate. let's say you were running an

airline and you wereegoing to purchase 50 aircraft from boeiig and then you were a much larger airline and weee going to purchase 100 airline. do you thhnk you will get a lower priceeif you are purchasing 100? do you think you will give a better service on your maintenance?? the scale, innterms of purchasing power should have some benefits. >> too big to fail, right? >> the idea that airllne the size of united aiilinee is not big enough to compete in needs to be bigger to be efficient is one of the more ludicrous claims that anyone has made in this industry in the last half century. the example i keep going is that mr. tilton should fly to moscow and sit down with the russians and said when you broke up the soviet union, it has such scale economies in not only did the commercial aviation, but you

broken up with the silly notion that while you would not have the scale economies, competition in its innovation would greatly offset the dea that you hadd many smaller companies. again it comes back to a factual points. if the scale economies, which is the synergyyclaim that they are making is really there, which no one else has found, great. if they are not, -- this is a factual question that objective people can sort through fairly3 >> the fact is united already did go bankrupt and they are still here. >> there is almost a perfect negative correlation. >> i appreciate that.

i know they did receive government taxpayer dollars right after september 11. i know you talked about the short training woold have prevented or would have full assault, and i conccr that the legacy care seacarriers hava great job with training. i want to see the same commitment which regional carriers. not all have been efficient, but higher standard be maintained. we will require the ffa, but we want to make sure the companies do so as weel, because they are ultimately in charge of -pthe training and requirements. >> now we will recognize the gentleman from california. and to co-chairman over starr has gone on and on about the

efficiencies at northwest and -- >> the chairman has gone on+ and on about the efficiencies of the northwest and delta, but i have my own description. i had to jump on the northwest delta flight, presumably to south sacramento. when i got to work part of the world's, i got off thh plane and found out that it stopped. it was not goinggto go any further and i was stunned in minneapolis stt paul for the night. they handed me a ticket for the next morning. i went to pick up my ticket and pot on the plight and i was not bboked. -- went o geto get on the flight and i was not books.

the computers did not work at all. which should have been obvious since i did not have a seat. the only way they did it was by teeephone to someone that they found in atlanta. so much for the efficiency issue of mergers. that is just a personal problem. my real concern is one of safety all the way around. iiwas astounded by the information given by the ceos about who was going to make sure that the main myt!aintenann china and singapore was a quality as though thee had no responsibility themselves for that. regard to pilots and other airlines thht contract with united or with continental, it

is the responsibility of the management of both united and continental today to say nothiig going forrard, it is their responsibility to provide assurances at the highess quality maintenance wherever it may be is done. i ill do everything i can to hold the management responsible for ts quality of the pilots finally, with regard to the issue going orward of the financials on the merger and whether in fact the justice pepartment is looking at it, mr. chairman, i might recommend looking at what we just heard that we invite the justice department to come and testify as to what they have found with regard to the issue of the

synergies of all kinds. if they're not even looking at them, they might want to beat them over the head and look at them. are tterr real synergies r one way to put spooe -- smoke up into the air? i do not have any further questions. >> icing we both wouldd with regard to flyinn that you both spoke so eloquentlyyabout earlier, we have a vvry good mentoringgprogram that has worked for certainly more than the 25 years since our inception in 1926. the mentoring program is where a senior kaptur mentored the more junior first officer. today we haven't bee a different scenario. we have highly experienced

pilots that are not working and we have less experienced ilots. you cannot trained for that. we should have slowdown and slow up. we o not have that their plans to put on those routes. last i checked, they have yolks and there is no reason we cannot fly the airplanes. to say that that is the solution to the problem is we do not have that size aircraft is ludicrous. the people that mentored us for the people whose very pensions were taken away, and we will have to solve for the outsourcing problem and e dissarity in the pensions as we move forward. >> i would add that that fra for trainnng standards and flight time standards are basically set

a baseline of acceptability. for years and years of the contracts -- alpha contracts safety and training. those wwre areas that got degraded in the contracts. as we rebuild the contracts, we will have to make mopay more atn to flight time and do the time i hope we have your support in pushing through the training panguage that ave been installld for so long. >> mr. chairman, a very brief comments. we have two ceo's here. i can recognize b.s. and being

shined on. i know i was shined on. there is a ery serious problem here in my view about safety, and when they tell me it is the faa's responsibility and claimed and backee away from it that it is not theirrresponsibility tt the quality of the people the contract with, that is the airlines and people that have been hired by the regionaa carriers, i know something is seriously wrong. -pi have been too long at this game, not in this particular chair but in chairs in california to listen to this kind of thing and finddit acceptable. they better responddto me. thank yyu, mr. chairman. >> the chair thanks the gentleman.

the justice department to send representatives over to testify today. it is their standard practice when they're reviewing the case that they declined to testify. they have sent a letter to us just explaining the procedure they will follow in reviewing the proposed merger, and i will tell the gentleman that we will take yyur comments from the record and write a letter to the justice department telling that that we specificclly want them to concentrate on the senate to set are claimed by the ceos from to go to the chair would ask members said they have ny othe+ queetions, comments. if not, the chair would recognize the chairman of the committee for closing comments. >> thank you, mr. chairman. it has been the most in lightning and valuable hearing,

especially this panel with very specific issues involved and raised by mergers, of course rather standard testimony. i almost could have written it with the ceos. mr. fuller and mr. haran, you said it standard anti-stress pnalysis focuses on horizontal overlaps. it is necessary but should not be considered sufficient. mr. haran, you obberve the committee needs to address the root cause of these problems. the nullification of long- standing and anti-trust laws and requirements. both comments go to the heart of

the issue that we're dealing with here in the delta s/northwest merger, acquisition, however you want to phrase it. what are your suggestions -- i just want your verbal response and thee put something in writing as to think about it -- how can we restructtre the d .o.t. role in the anti-trust force on the calculations done on the anti-trust proceedings? anti-press law is limited to porizontal overlaps. i had to ask the justice department in the delta and

northwest situation where therwy would consider the downstream affect of the merger on the other possible mergers, and it was like pulling teeth, but eventually they said yes, we would give that consideration. they did not say it would be a factor, but the anti-press role is like a straight jacket. it is very limited. the d.o.t. has wider latitude in these matters, but they have gone on to prove anti-press immunity, along with justice, for internaaional alliances. what are your thoughts on how we can rephrase that? what provisions could we include in future legislation? >> i do not think the annwer is with getting d.o.t..-- giving

d.o.t. a larger rrle. d.o.t. provides informatiin that is very immortant. it is not that the law, the anti-trust flock, is necessarily that narrow. it as been interpreted in a very narrow way for 30 years. the justice department and ftc have put forward for public comments a revised horizontal merger guidelines. and that they recognize the rooe of incipiency for instance. section 7 is in and said the agency -- is en incipiency law. it is trend. it is prediction. i do not think that has been the

way the agencies have been interpreting the law sufficiently in the past. the law is there. pressure from congress to utilize pulte lost to its fullest is what is needed. i think the agencies are capable of looking at not only the merger before it, but recognizing tactics and recognizing that companies interact onna strategic basis, and when one goes forward and changes the structure of the industry, the others have to respond. i think that can be taken into accounn by anti-trust, but has not been. >> do you think there is not much more we can do with d.o.t.? >> i agree with the law as it is written is not the problem. there are no obstacles in consideringgthe actual economics

of applicants pptitioning for a merger, but they refuse to do that. the deregulation of the airllne industry was designed specifically on the concept that other laws have been applied to all other deregulated industries designed to create a level playing field that detects consumer interests. the problem is the department of transportation has been getting the antt-trust laws -- gutting the anti-trust laws and ordered to respond to the lobbying poopannes. distort competition to urt the u.s. airways, hurt the northwest, the southwest, the jet blublues, and the departmenf

transportation is a willing participant. the consumers are already high your far higher shares, anr objective is to make sure the same impacts go into the pacific. they aae hurling everything possible to stop squinty of those cases. they do not want evidence presented. i have at applications to say wait a minute, the court claim of the japan cases is the network synergies. i use to run the biggest of thun tokyo. i understand -- i can evaluate the claim. i am in the top five for the best person to evaluate this. the department of transportation said absolutely not we can have had aayone evaluate this.

we're crating new rule that says only lawyers can do it. -- we are creating a new rule that says only lawyers an do it. they're going to hat level to scrutiny of the claims. just go back and allow their a viable -- verifiable skirt the and i think you would serve two- thirds of the problem right there. he would also bring the airline consolidation movement to a >> you are quite right. when i sat down there in 1978 and worried about the deregulation, what will be the outcome here? we anticipated that the carter justice department would rrde herd on any mergers that would result.

we did not counn harm carter losing the election, reagan winning. they all went the book. the argument made today in two years ago by delta and northwest was we need to be big in the marketplace. the notion that united is not big enoogh to compete in domestic and international the language of anti-trustt code is any activity affecting commerce in any section of the country, the effect of such an acquisition may be substantially to lessen competition or tend to create a monopoly. there is a large judgmental

opportunity and those words that has not been used in so many years by the justice department as to be placid. need to be strengthened and encouragee. that is why i am looking for something that does not have the jurisdiction over judiciary, but we do have over d.o.t.. i am looking to strengthen d.o.t. in this process. baggage peake collections for 2009. -- in baggage ffe collections for 2009. that is for 10 carriirs.

that is what bigness has given you. more mmrket power in the domestic marketplace. more suppression of passengers and travelers in communities. choices. maybe a few more choices on pnited or delta, but not more choices for all travelers and consumers. the shift of employment from one city to another and downsizing. it is a terrible, awful, no good thing. the justice department should turn it down. i will continue to do everythinn in my power to make that happen. this is the very antithesis of

deregulation. regulations to reeetablish%- market regulation by the government of airlines. >> the chair thanks the >> i was going to mention that what deregulation has led to is possibly reregulation, and we have discussed that on more than one occasion, and maybe something that we will have to move forward, depending on what the justice department does. ladies and gentlemen, thank you. we appreciate ou offering your testimony today. i think the chairman and others have summarized the issues we have heard. we have heard the concerns concerning safety, the work

force, a number of other issues. we will urge he justice department to specifically looo at those issues on reviewing this proposal.. again, we appreciate your testimony and the subcommittee stands adjourned. thank you. [captioning performed by national captioning institute] cable satellite corp. 2010]

this week in prime time. muhammad yunus writes about social business. also, joseph stiiglitz talk about the 2000 eighth economic collapse and what is next. >> before the senate judiciary committee vote up or down, watch the entire confirmation hearing for elena kagan, including her testimony. you can watch this on line at the c-span video library.3 c-span is now available and over 100 million homes, bringing you a direct link to public

affairs, politics, and non- fiction books all as a public service. created bb american cable pompanies. >> now today state department briefing. this is about 15 minutes. >> good afternoon. germany is willing to resettle

two detainees held in guantanamo bay. we greatly appreciate the decision to resettle the detainees. this is a strong signal of germany's commitment to assist the united states in closing the the list of countries resettling detainees continues to grow and we are encouraged by the assistance of the international community, which continues to support disclosure effort. we would also like to wish germany and spain deadlock in today's match -- good pin luck in today's match. we are rooting for a good match. >> you had wanted them to take three. they are only taking two. are you disappointed? i would not raise it that way.

we re happy to have the support of another country. we appreciate germany stepping up to the plate to take these detainees, and we apprrciate the efforts of all our friends and partners around the world who are helping us achieve the goal of closure of the guantanamo bay facility. >> [inaudible] >> i will refer you to the german government. we')e pleased to hosttcheney's advice prime minister. -- we're pleased to host china's vice prime minister. undersecretary of political affairs, he will deliver closing remarks. that is all i have. i will take your questions. >> i nooice on the schedule

that [inaudible] will also join. >> that may be the case. i can look into that. that makks sense. >> speaking of bill burns, you can you tell us about his meeting wiih the russian ambassador? >> he meets regularly with the russian ambassador. at ttis morning's meeting they've reviewed the recent meeting with president medvedev. we have a broad spectrum of issues that we work with. help me al. >> there are numerous reports that there is a deallin the works to swap some of tte alleged russian spies with peopll convicted in russia of espionage or other things.

did this by cases come up in the meeting at ll? -- the spy cases come up in the meeting at all?+ >> was not the main purpose of the meeting, ut i believe it did come up. >> what part of the case was discussed between this building and the russian ambassador for which you said the justice department was not present at? >> it is a regular meeting he has with the ambassador. it was to discuss follow-up for something that took place two weeks ago. did the spy case come up?

likely it did. am i going to et into details? no, will refer you to the justice department. >> [inaudible] >> on thht issue, i will refer you to the justice department. it is an ongoing legal process. >> aside from the actual investigation, can you deny that there are any negotiations going on between the government's -- >> i will not get into any discussion. >> [inaudibll] involving the spy case, i will have to refer you to the justice department. any other questions? >> go ahead. >> [inaudible]+

>> i think we have been pretty clear all allng that our goal is to get into direct negotiations, and certainly that has not changed. it was the impetus behind yesterday's meeting and it is what we are all working towards. still ahead. >> you seem to endorse using a military option for countering people iran's nuclear program. have you seen those statements+ and what is your action to is statement? >> i have not seen the statements. >> was s speccfically whether the u.s. would stop a program by force, and he said abssluteey, absoluteey. do you take those words seriously?

>> i have not seen the current text or theereport. -- i have not seen the context we have been clear all along we have a significant sanctions regime in place now. the engagement track remains open. those are our pursuits right now involving iran. >> are you hearing those segmenand sentiments from the n? >> we have brought sentiment recognize that iran needs to address the nuclear program in a transparent way. it is the reason we have a place agaanst them. the reason why other countries have followed suit with similar sanctioned programs, but again, we have a two -track approach.

>> the department of justice has unveiled new charges related to the new york subway bomb plot. i am wondering, have you communicated with pakistan government about the specific charges? >> we have a significant counter-terrorism cooperation with pakistan, but as the specific case -- i can take this question ut i may end up referring you to the justice department. >> [inaudible] >> our understanding is that security council members are involved in initial discussions

regarding a possible tatement dealing with the recent spate of of movement in southern lebanon. we continue to call on all parries to adhere to obligations under the terms of u.s. security council resolutions 17 01. -- 1701. >> does that mean that you support france for changing the pules of engagement? >> i think it is a matter under discussion right now. we call on all parties to adhere to their obligations under terms of 1701. go ahead. it is a matter under ddscussion. i will let ittbe addressed in the security council. >> speaking of france, the you -phave anything updated to say about [inaudible]

? it is our position, i think the united states government has gone to court to protect the rights of women and girls. >> i missed the word france in3 find a solution that addresses security concerns without affecting religion or minimizes other restrictions where possible. >> [iiaudible] >> i am not sure. >> do you have any reaction to the conviction?

>> i thought i did. hold on. let me get back to you on that. go ahead. >> the extension of emergency powers in thailand -- >> right. i have not dealt with that yet. thank you for asking. we consistently stressed the iiportance of the law and the need to resolve differences through thailand's democratic institutions, there really is a matter for the thailand authorities to decide based on their rule of law. go ahead. >> a group of 87 senators signed a letter to the president for support for israel.

inteeligence community and the state department. is there an investigationnof on going? >> i believe we're looking at the ihh, but it is a long process to desiggate an orggnization. there is nothing to announce on that. >> go ahead. on the reports of israel and a nuclear agreement? >> do not have anything to report on that. i do not have anything on that issue. go ahead. >> coming up next, our interview with the research director for the center for immigration study. then at francis townsend on counter-terrorism. then president obama talks about exports.

"book tv" continues all this week on primetime. tonight a focus on economic issues. expanding social business.3 about the 2000 eighth economic collapse and whht is next. "book tv" in prime time all this week on c-span2. >> our public affairs content i+ available nline, radio, television. you can also connect with us on facebook, twitter, and youtube. sign up for e-mails at c- span.org. a discussion about immigration policy. this morning we talked with the

researcher for the center of the immigrrtion studies for aboutt40 minutes. . . . . host: steven camarota joins us to talk about u.s. immigration pollcy unner the obama administration. pplet'sstart with the lawsuit announced yesterday. hhw does this plan to the administration's overall policy pptoward emigratio!!immigration. guest::the administration is trying to show they are serious, wanting to move against the arizona law, wanting the courts to stop it from going into affect. they argue thaa there are constitutional issues. host: could have cooe to some sort of terms to workktogether on something like this? it seems thii is more of a turf battle over who will do the

enforcement, rather than addressing the question of the need for nforcement. guest: i think there is some compromise possible. it is hard to see that here. the state wanted to do something. it had overwhelming suppoot in the state. the obama administration has a different opinion. it is tough to find compromise%% with that. host: one of your pieces earlier from the tennessee paper, what is to try to get there? guest: many people would say that we have to start enforcing the law first. lee's stop talking about the idea that we will let illegal immigrants stay, that they will

get a kind of mnesty -- whatever we call it. the public and common sense suggests the first thing you must do is restore the rule of law. %%collector employers. keep track of those coming in on a temporary basis. if you constantly say we will, right now -- you are going to do tto things. you encouraged illegal immigration, and at the same time destroy morale of those whose job is to enforce the law. host: on the otter side there are those who say that at some point you have to offer amnesty because you cannot take those who are already here illegally and send them back to their country of origin, then expect them to get in the back of thee% line. that we would be moving millions and it would not be possible. guest: yes, there are an estimated 11 million illegal here.

but sometimes we face a false choice. either we deport everyone as quickly as possible, or we have to give them eventual citizenship. i hope we don't face that kind of false dichotomy. a more moderate ground is let's enforce the law. the illegal population has declined by 1 million in the last two years. let's keep that going. let's enforce the law. we know from research that up to 300,000 leave on their own eaah year.. they either decide to return to family, and sometimes get deported, as well. we need to get more to make that choice, reduce the number arriving, ann overtime the problem can take care of itself. if down the road we decide we want to have amnesty after enforcing the law for years, we

could consider that. right now makes no sense. is putting the cart before the horse. -- it is putting the caat before the horse. host: stevvn camarota is thh research director with the center for immigration studies and is here to talk to was a beel policy for the next 30 minutes. as at the beginning of the program, we will have a special line for arizona residdnts. if you have called within the last 30 days, send us an e-mail or message by twitter. tell us a little about the center for immigration studies? guest: it is the nation's only phink tank devoted exclusively

to setting immigration in the u.s., we are non-partisan, and we provide many research on the impact of immigration on the nation. all our publications are available for free. everything we have ever written is on cis.org, available for download. host: our first call comes from the line for democratt from michigan. caller: i have seen a document on cnn that shows we are paying $1 million or more per week to house these people. murderers, rapists, and all kinds of people like this. we should either send these people back or charge mexico for their room ann oard.

guest: the caller is certainly correct. crime is a big issue. the overall issue for illegal tough.ants and crime is very in the state of arizona looks like 11% or more of their prison population are illegal immigrants based on a program where they try to check status and then ask the federal government for reimbursement. it is true that in a certain to they have found 22% of all felonies committed their were committed by illegal immigrants. it would seem to indicate at least in arizona there is a fair amount of illegal immigrant crime. as we're trying toobill a foreign government -- as for that, good luck. it is not likely. this is an issue, one of the main concerns in the arizona. it is one of the reasons that

arizona passee the law. but whatever the costs, we will have to absorb them because we cannoo recoup them from another country. host: on the line for republicans, from california, go ahead. caller: we have of course in silicon valley -- we have, of course, many illegal immiggants. north 1, my question, when he u.s. -- number one, when we took the japanese and put them into camps, how many? it was over 1 million. this precedent was already said. i was on and if you did talk to the key constitutional issues regarding the obama filing agaanst arizona law.

what are the key things they're talking about? i understand something about the commerce clause. can you drill down and tell us the reality of the worthiness of the hooder filing? thank you. guest: in terms of the interment of the japanese during world war ii,, the supreme court ruled in many cases it was not constitutional. we actually to people who were american citizens. but that is not really the issue of illegal emigration, but more one of national security at a time of war with foreign nationals in the country. let me give this warning that i'm not an agenda. one of the main questions is whhther the state of arizona can make policy in an area that is

clearly one r the primary responsibility is the ederal government. in general courts have ruled in several cases that t is ok for a state to make laws to discourage illegal immigratioo. they have also ruled that it is ok for state policeman, and local police tooenforce federal statutes. it seems that arizona has met standards defined by previous federal court rulings. with the brief prayer really argues is that it is upsetting the balance. the department is arguing sometimes e enforce the law, sometimes we do not. we do this based on complex the race of various policy goals.

if arizona says, look, we're going to enforce federal law. that is what they have done. their llw issa mirror of the federal law. the brief says they cannot do that. but it does not seem there is any court prescedent or legislation passed to indicate that. theebrief itself has barely any citations of previous court rulings. so, it will be tough for the justice department to make the case. there is alss a civil rights argument that the ay the law is deserted is inherently biased. it is hard to make because the losses you can use ratrace to determine ssatus, and it is harder for the government to make the argument the law has not yet gone into effect. you have to say you think it will be biased.

but it doesn't seem that is likely to pass muster with the caller: hello. yes, thank you for suspending a finally you have sommone there who understands the laws of%% immigration. and those are that ronald reagan put into effect back in the 1980'))s. it is to go after the people who own businesses who are these i am sick and tired of thess people coming on these shows and talking about why we need new%% immigration laws. just put the laws you have into effect. if i break the law,i'm doing something -- they don't turn around and make a new law for me. the go by the law that is on the books. ttat is exactly what they shoul- do. i'm all for immigration because we all come from different

lands. but the germans or the irish or the norwegians -- they did not come by the illions. they came by big bunnhes, but they stood in line and got their citizenship. guest: the caller makes a reasonable point that there are lots of laas on the books not currently in force. for example, it is iilegal to employ someone not authorized to work in the u.s. but that law which we passed in 1986 has largely been an enforced. we originally envisioned having an employer ata base to check. that is still not fully implemented. it is only a voluntary system. the caller is correct that we allow people in on a temporary basis, and then do not keep track of whether the person leave sometime. these include foreign students.

they could be 40% of the population of illegal immigrants. we don't keep track of people. a large section of our border remains unpoliced. it is not that hard from either the southern or northern border to enter. what is important about the political sentiment is is very unlikely the public will support amnesty unless they believe the law has been enforced. right now they're correcc to say it is not happening, and we doubt it will, unless we begin. once theee is an amnesty, will we repeat the same process? and in 1986 we said we would crackdown, and we gave amnesty to about 3 million. since then, the laa has been and enforce, and now wehave about 12 million in illegal immigrants. the caller's question reflects

the view of most americans -- first enforce the law, then come back to talk to me about amnesty. host: the next call comes from mike, on the line for republicans. caller: i'm interested to hear you talk about a couple of persons past. as complicated as it is, there needs to be a central force to resolve all those issues. i thinn i found one in the prticle one, section 9 of the constitution that says congress -- the migration of persons of any of the states entering and proper to admit shall be not permitted prior to a certain there by congress. -pthe constitution gives congres

not only the right, but the duty to handle it. it is not obamm or ron reagan responsibll -- is congress. because of the supremacy clause in the constitution, that says this is shall be the supreme law of the land, and all state judges are bound thereby to support. host: we will leave it there. guest: the way that the llws constructed in arizonaa specifically says a non-citizen must carry documentation with them. it takes the exact language of the federal emigration language. there is no conflict with that. the courts have ruled that kind of situation is allowed in the

sense that police can enforce local laws, and local communities can adopt laws to discourrge illegal immigration. the cannot have a law in conflict with federal law. this law is speccfically designed to mirror federal law, designed not to be in conflict. at least on its face it is not in conflict withhfederal law. but obvioussy, the lawsuits argue otherwise. host: i want to show the viewers discharge from "the baltimore sun" regarding states and immigration laws. and following the lawsuit against the arizona bill, the u.s. department is arguing the federaa law supersedes state legislation.

with that as a basis, why is there some attention on this arizona law, and not so much on the other 71 enacted by these other 34 states? guest: it is a criticism people are making of the administration. it does seem they have picked+ out arizona. they have left these other dozens of laws and ignore these court precedents that say that the states can. that the states caanot do anything here. since the law is desigged to mirror federal law, it would seem to get around issues of supremacy and pre-emption. host: here they show a picture%-

of the arizona governor who was to host a conference of mexican and american governors, but the mexicans are unhappy about the%- new law and protest. from left to right, california gov. schwarzenegger, texas gov. rick perry, and ew mexico gov. richardson. is this law that arizona is trying to enact -- will have far reaching implications beyond the borders in arizona? will other governors look to it to see where they can and cannot go up against the fed steps guest? guest: missouri has a similar law. but it is more likely that many governors will not choose to do what arizona has. a program called e-verify --

arizona said a few want to hire you must use this data base to check if you're a worker is illegal or not. it seems to have had a big impact. there is an 18% decline in the illegal population compared to 7% nationally. but since all agree that kind of law is movvng through the states. several have alleady dopted parts of that for contractors. so that is probably where arizona is llading the way. it is not clear whether more will do what arizona haps in terms of law enforcement. host: steven camarota is here to talk to about u.s. immigration

policy. from san antonio, texas, on immigration policy. caller: people are getting tired of these politicians. arizona is fed up with what bush did and obama is doing. we want our orders secured firss. then we will talk. the business people here in the u.s. have screwed this country over. all the what to do is lower our wages and get away with all the money they can. we have to secure our borders. the terrorists are here. it is not heemexicans. it s the other people who come

with the drugs and everything else. guest: believe what the caller said to stand on its own, but enforcing the law is what most americans want. that is where we have to start. that is where the biggest agreement is. then we can debate amnesty a couple of years down the road. you have to go after employers, and get more cooperation with local law enforcement. track the arrival and eparture %- people. another big area involves when we order someone deported, following up on that. we have about half a million people living here illegally who have been ordered to be deported by an immigration judge. that is another area. once we take those steps, then

maybe we need a national debate about amnesty. butlike the caller, you must do first things first. host: next up, metarie, louisiana, on the line for republicans. callerr we had hurricaneekatrina here and it did not of illegal immigrants as we did after hurricane katrina. humans in going after employers to hire illegals. what will happen to these people when they did not hire them? how will these people survive? p- you mentioned going after employers who hire illegals. i don't see how it will help the situation with illegal

immigrants who are here. they will not go home. guest: some people do argue that, but the fedeeal government has estimated that the illegal population between 2008 and 2009 did decline by 8500000. one of the main reasons that happened is many more went home. maybe 300,000 went home then, and it may be up to 500,000 going home now.% so, it is possible if you cut off jobs to encourage a return migration. recent trends demonstrate immigraaion is not a permanent phenomenon. it is not so prominent as some have previously believed. people do go home. they always have. mmny more have been going home recently partly because of some stepped up enforcement efforts, and partly because of the eccnomy. we ccn use that as an example.

not every illegal immigrant is here to stay. the facts demonstrate otherwise. host: good morning, from mesa, arizona. caller: these people in the california who want to boycott of us might want to look at theirrimmigration law which is as is the federal law, as is the mexican law for immigration. this is ridiculous. it is not just mexicans coming across our border. it is also errorists like hezbollah, iraqis. anyone coming across tte border, whatever. the idea that obama will not enforce the immigration law is really outrageous. he wants more votes. in the long run, that will hurt everyone. the u.s. government has aaready

given 80 mills of arizona land to drug cartels. they're down there sitting on hilltops as lookouts for the drug runners. this is ridiculous. enforce the laws we have in this country. guest: yes, one thing the caller said that is partiiularly interesting is that a country like mexico has complained bitterly, but they have similar laws. in general mexico's immigration laws are pretty harsh. as the illegal immigrants from guatemala can tell you,,and abuse by bott the government and bandits -- it is not great down there. so it is hypocritical for mexico to say that. many other states do similar things. not exactly what arizona has.

but making a state adopting policies and laws designed to discourage settlement of illegal immigrants is nothing new. arizona is in keeping with a longstanding tradition. it has already passed court muster. host: this e-mail came by a viewer from colorado. guest: yes, 287g is a program that deputizes local police. it allows them to explicitly ennorce federal immigration law. it creates a corporation between the local law enforcement and federal emigration a 40's, both in terms of a working relationship, and thh ability to access databases. when someone iss arrested or in

jail they can search databases to see if this person is likely illegal. it involves several things. in general, in places where they have had it it has received a lot of praise. there are some critics. the one county in arizona had it, but the federal government %%is dissatisfied with the sherf there. they have discontinued the program as a reeult. it has been extremely helpful to identify illegal immigrants. it is unfortunate the federal german is not pursuing the expansion of it. there is another program called "secure communities" which lets jails excess government databases. host: what is an moa agreement?%

guest: it is an agreement that a locality can enter into with the federal government. it would help coordinate immigration enforcement in that locality, including things like the ability to access government databases. host: back to the phones, charlie from chicago. caller: we hear conflictiig reports about the economic impact of illegal immigrants. you mentioned you have expertise in the area, so we do talk a little about that? guest: yes, ittis a big question, and i will try to be brief. basically, illegals make up 4% of the population. in the aggregaae, illegal immigration will not make a huge difference one way or the other. a big area of concern is job

competition. the short answee is, most americans do not compete with illegal immigrants for jobs. primarily because the illegals or to the bottom of the labor market. most have not even graduated high school in their home country. the problem is, precisely in that part of the economy where believe is due to be with the native-born competition is with the poorest and least educated parts of our country. overall unemployment is 11%, but that for college graduates is 6%. but for american high school dropouts and is 20%. if we look at those with only a high-school degree and our young, the kind of person who does compete with illegal immigrants over construction and food service -- that is where illegals are mostly concentrated. unemployment for high-school

dropouts in america is 20%. we have a paradox. most americans did not compete, but those who do are overwhelmingly those were the least educated and already the poorest. concerning taxes paid and services used, illegal immigration is a drain. the illeggl immigrants use more services than%% they pay in tax. it is especially true if you count any of the costs associated with the children have once they arrive here. we probably spend about $15 billion educating illegal immigrant children, those illegally here. but we probably spent more like $35 billion if we also count the u.s.-born children of illegal emigrants. the costs get very big ones recount their children. the primary reason illegal immigration creates large fiscal costs and look of their taxes compared to the services they

use is not their legal status or because they did not work, but pather their educational attainment. people with relatively little education did not pay much in taxes. legal emigrant's without much education are also a fiscal drain, as is the native-born population without much education. so, does it make sense to bring in many unskilled immigrants? host: next, a kalamazoo, mich., on the line for democrats. caller: about three years ago i sent a letter to senator kennedy on immigratioo, nd also complemented that he was always the hero of mine, the way

he fought for those who cannot defend themselves r did not have enough oney. but getting to immigrrtion, he read my paper and asked if i would be willing to work with his legal department. and ii did that for about one year. when it was done if it would have been implemented and brought to committee, it would pave found every illegal immigrant within the u.s. and a little over year except for those 100% getting their money from drugs. the company in my own hometown had an illegal emigrants working for themm i turned them in. they got 250 people including

the company was given them an extra $1 per hour and health insurance, and telling them to keep their mouths shut, and it paid no social security or unemployment tax, or income tax, or state income tax. host: we will leave it there and move on to arizona on the line for republicans. caller: illegal immigrants and the state of arizona drain our education and social programs. is there a law stated in the federal law that prohibits them from coming to social services and receiving food stamps and all of that? also, when it comes to educating their children, and my little town we have seen a huge decline because of the lack of jobs. our education system is

basically supported by ppoperty taxes. they are draining our education services. so, can we, or do we have as a nation of laws prohibiting them to use of these particular services? guest: the short answer is both yes and no. in education, no, the state cannot bar illegal immigrants from receiving an education from kiidergarten through 12th grade. this is a well-known decision from the 1980's. congress can bar them from receiving it, but states can on their own say no education for illegal immigrants single-family on other programs, in most cases illegal immigrants and not supposed to get them. if they have a fake id, then it can happen. more often a sign of their children, so that children can get free school lunch, can be enrolled in medicaid, it can

sometimes get food stamps. a pregnant woman who is illegal can be enrolled in medicaid, and can also get the wic nutrition program for low-income women and children. there are several programs that illegals can get, but they don't use them that muuh. there are many children of illegal immigrants signed up for these programs. tte caller is correct that there is this fiscal drain, but it will be hard for arizona to do anything about that. the on a thing arizona can do is encourage illegal immigrants to go there, and to avoid the cost for arizona. the to and can sign up for emergeecy medical services. about one-third of the unemployed in arizona are illegal and they will be provided that medicare and education.

host: the line for independents from connecticut. caller: hhllo. we'll let me finish if i talk fast? i was aa deeocrat and became an independent because i'm fed up with the democrats. i can see right through them and their stand on immigration. they only want the vote. a mother and her sisters came to ameriia from poland the legal wait many years ago, through ellis island. you did not see polish, italian, the other ethnic languages written on all of our products as you do today with spanish. and the spanish people have babies like rabbits. i have had it with asking salespeople in states and asking the question, and not understanding them because they don't speak english properly. what happens if they refuse to hire illegaa immigrants forward? see how long they stay around. with all these immigrants coming

into the country, look at the beebug situation -- what has brought that? i think there should be no party -- was called the people's party with everyone getting together with their ideas and no grandstanding. it would be the only parry to get all done, that way. guest: many of the things she is concerned about look closely to the idea of numbers and lack of diversity. in the past there were many different immigrant groups and no one group dominated the flow. no more than half of all immigrants to come in our spanish-speaking. then there is the numbers issue. we take in an enormous number of illegal emigrants. . . .

caller: i am here. i agree with that last caller. i am tired of climbing over baby strollers and hospitals. host: i will unfortunately have to cut you off. we will have to get onto another piece of programming. thanks to our guest, steven camarota, to talk to us about immigration policy. >> up homeland security dviser francis townsend on counter- terrorism. president obama talks about efforts to promote exports. a discussion about how terrorism is viewed outside the u.s.

the heritage foundation reduce the supreme court term. >> "book tv" continues this week. mohamad won the peace prize for his development of micro finance. he writes abbut his efforts to expand social business. maria on living through hard times. and an economist talks about the 2008 economic collapse and what is next. all this week on c-span2. c-span is now available in over 100 million homes, bringing you a direct link to public affairs and history, created by american cable companies. former wwite house homeland townsend. she talks about cyber security

and efforts to engage the public to help counter terrorist threats. she spoke at a recent security conference in colorado. this is about an hour. >> [inaudible] except that she has been an inspiratton to this conference. she was president bush's white house homelanddsecurity adviser. commandants for intelligence. admiral mullen -- it struck me that twice he kept talking about synergies between terrorist groups. how does that affect your

thinking on homeland security? >> let's start with remember they christmas day attempt. my successor came out and explained that the connection to al qaeda was somewhat surprising to them. this was a regional group that had targeted inside the homeland. then we had a christmas day and the attempt in times square. the administration explained the ttp had been surprised if it had expanded to directly make an attempt on the homeland. when the admiral talked about3 talking about is the difficulty in getting into the decision cycle for an attack. you find groups that don't share a membership, but a belief in tactics.

similar targets in terms of targeting american interests. suddenly you find these like minded groups come together to want to share training, money, people. it becomes much harder. you are no longer targeting a single group, but this network of groups that share certain things in common. >> when you were at the white house was that already >> we began to see it. >> can you pull your microphone up just a little? >> we began to see a consolidation of effort. you saw a group in north africa to align itself with al qaeda. you began to see these alliances are around the world. all these groups began i will

not say strange alliance, but confluence of events. we understood they had a priority for those who were either americans are had american travel documents. we were working with our british colleagues to look at travel patterns around the world. we understood there was this network that was informing. we were watching it very closely. we are seeing some of the results of that effort. >> why is this happening? were we doing something wrong in which we are allowing the federation to occur? >> i don't think so. the current administration has been incredibly aggressive against al qaeda. the more you put pressure on the core of the network the more you

are likely to say -- that is part of what you are seeing. you are seeing a natural reaction to pressure started in the prior administration against the core of the network. >> how should we reaajust our tactics? >> we haae always understood that our relationship with foreign partners is important. not all foreign partnerships are -pcreated equal. not all partners had equal capabilities. some are more transparent. some are more consistent than others. you understand that as the home grown threat -- these loose affiliations strengthened and the threat rise you have to rely more on your partners.

you have to rely more on the state and local partners. the people who are mmst likely to see an anomaly or your local police forces. that relationship. importance o- we have to do a better job at engaging the american people. we have not seen a major attack in the u.s. since 9/11. we have seen increasing attempts, but when you compare it to the scale of 9/11, at uc a guy with -- you see a bad guy with a bad bomb in his underwear that did not go off. people take an unjustified comfort in that. it is a matter of emphasizing that the threat continues to be real. even state and locals will not

be successful without the help of the american people. >> when you say engaging the american public, are you asking people to watch out for their neighbors? >> i think of this in a number of different ways. we have to engage them in a very specific -- you don't want3 frightened about the next attack. that is not affect this. you want to be able to talk to people ss they are preparing their minds for what is inevitable. we were talkingg about 25 arress this year for terrorism. there have been many well-known attempts, whether it is the baakpacked bomb attempt, the times square the detroit plane. one of these will be successful.

talking to the american people to prepare them for what may be the eventuality of the next attack. if there is another attacked part of the reason we want to talk to them is to begin to understand that even a successful attack cannot if someone is hurt or killed, when you compare that to the level of success on 9/11, this will be their failure. you will not be able to say that in a crisis. you have to talk to the american people about what terrorism is. i don') think we do a good job of that. you have to tell them what you want from them. tell them what you need them to look for. finally, a matter of engaging them in the civil liberties debate.

the executive branch of government will make that balance for you. looking backwards, the american people will criticize how they the session got made. -- house the decision got made. you want to engage them now before the crisis, because the american people have the ability to affect by elections and public debate their views on how the balance should be made. there is a real value. if the response to this is why doesn't the government begin that debate? it has become the third rail of american politics. this notion of information sharing and what does the

government now? politicians don't see in in their interests. it requires a grass roots debate. >> have we calibrated is wrong that we are to fanatic about - this? >> there are ways to do it if we could have a conversation. i think there are ways we can do more. everybody here goes on to the internet and everybody will know that these sidebar ads of what you have been searching for -- all of the private sector does this. there are ways to do this. i think we need to talk about it, because we are not taking advantage of a capability available to us. >> it would seem part of the problemmis we are not

information sharing in the agencies. is there a problem with the fbi , state and local and departmenn of homeland security? >> look at what happened on christmas. we had a lot of information that we did not take advantage of. i think i can still say it. the american people were reasonably forgiving of the mistakes their government made on 9/11, but i would tell my staff that they will not be forgiving a second time. they have a right to expect the government not to make the same mistake twice. there are others -- this is one that makes me angry.

the technology is exists. this is not a technology problem. it is a failure of policy and leadership. when i was in government there was a national information sharing strategy meant to lead the agency through this, but it cannot be it is an acceptable mistake to not share information. is it is not ok. >> what is the policy failure? >> you see something like christmas day where iiformation is not adequately input or shared. it cannot be that we acknowledged that and there is no consequence. i venture to say if the president calls his cabinet -- we will have a chance to ask michael chertoff. if the president says the next

time this happens i will not hold the agency accountable, i will hold a cabinet. a cabinet member will be fired. you bet you that that will get shared. the cabinet secretary will take responsibility to make sure he beats his agency into submission. we will not see that. it is that important. it requires a clear vision and accountability from the white house because this is not an issue of malevolence. the notion that someone is making a conscious decision to take a report and high debb is not accurate -- and hide it is not aacurate. it requires a conscious decision -pevery single day that this isa

priority. i still don't see that passion in this issue. this is not the thing that people want to have to be there defining issue. if we don't do it well it can be the cause of an attack. >> it seems after 9/11 and the christmas day bombing, that is all the same, a failure of information sharing. >> to be fair to my colleagues, i think it is better. there is ever put against this, but i will tell you the problem is every time you have a problem there is a lot of attention put against this at senior levels and everybody goes back to their day jobs and it begins to dissipate. that is why it requires very senior level of tension and a whip at this every single day.

i wish i could tell you let's build the right system and it will go away, it won't. systems do exist that allow -- people really bought and and a demand is present. the system exists. you could have this happening, but agencies refuse to put data in. >> is there any one person responsible for data sharing? >> this is moved around a little bit. there is the office of information sharing. i will skip all of the controversy currently swirling around them. there is a person in the homeland security council. the homeland security adviser is responsible, -- far be it from

me -- what we do not need is one more czar, but this ought to be parr of the mission responsible for cyber security. cross government that solves this problem if there is the will. this is fundamentally a question of will. it can be solved. that is why i am frustrated. >> what would you do if you could issue an executive order? >> i think we have learned some lessons about trying to solve big problems in one gulp. the department of homeland security had the right effort. it started with too many agencies. you have to be mindful of solving big problems in a single

bite does not work the way you plant. you start with those things you care most about. there are legal restrictions on sharing that information. all those rules can be written to protect that information. to allow that information to be surfaced to the top and be looked at. all of that exists. the executive order as it say it to the law-enforcement community, this information is all going in. >> all going in what? >> into a single system. the agencies will not put it all in. i encourage you to ask someone whose troubles wiih this issue every day. you have all the systems that are present, but they are not

integrated into a single system. the agencies who own that data will not permit that to happen. there is a vulnerability inherent in putting them in a single system. if that system gets corrupted you have access to all of it. you are making my argument. i agree with you. the benefit in terms of identifying threats is worth the risk. the risk can be mitigated and you have lots of smart people in the room who are here to understand how to do that. >> are we moving in that direction? >> it is not fast enough. i don't see enough movement. for many of us over the last two

decades christmas day is a little bit shocking. people have worked on these issues. the notion that we find ourselves making some of the same mistakes is frustrating and deciphering to those we lost on 9/11. p> you have had a couple of shouts. give zoe and microphone. do we have a microphone? shout it out. i will repeat it. >> do you have a microphone? >> having said there is this an vulnerability, i will talk about this while they look for microphones. >> where are the microphone+ runners? did you want to say more?

>> no, i would like to hear the answer. >> cyber security. >> i think the president made an important speech and began a very important effort. i remember talking to succeeded me and said be careful of your vision and ambition when you get into office because the security of the in box gets in your way. . .

but different from anything we have done. you need a common physical location and a common understanding of the public and private sector where we stick together and talk about the intellectual capital and the capability in the private sector. we have some capability in the government, it is not what we need to solve the problem. what you find in washington is people make policy and not understanding second or third quarter consequences. we ought to invite the private sector in to help with a debate in conversation with how we ought to implement it. they own the critical about.tructure we're talking the government rights of private backbone. nowhere is that more obvious

than in the military. our allies, you need to bring the foreign allies in. there is deep suspicion among some of our allies. in terms of the u.ss cyber security effort. the u.s. government should not be the convening body. you will get the facts -- you have to have a platform and convenient authority. you need some non-governmental body to bring the international community and make a public- private partnership. have the dialogue and have it began as a non-governmental effort. i do not think this will be easy. the u.s. government will come with deep suspicion. we know from public reporting that the russians and chinese have a tremendous capability. nowhere is that more brightly than the private sector that it

stolen blind every day. our creativity and research and development dollars get thrown out the window when china and russia can steal things from us that we have paid for. we see little effort to protect or prosecute those -- the intellectual property. i think this is not only a required partnership but of a different nature than anything we've seen. >> a cyber attack, is the most likely to come from a major state actor like china or russia? or terrorist group or home? >> when you are in government you are worried about all that. it is less likely to be a terrorist act. we have had [unintelligible] i do not think it is likely to be in that vein. terrorist groups use the

internet to communicate and train and recruit and finance. it is less likely. i do think it is more likely you will see it from the state actors. >> have we already seen it? >> yes. people know it better that night. you will hear from folks like dick clark. we have seen multiple efforts. we had seen these what appeared to be state-sponsored efforts. >> would use a ublic park -- public private partnerships, are you talking microsoft or cisco? >> there are -- i remember having this debate. secretary rice was outspoken about the need to include when

we're talking about public- private partnerships, academia. mike mcconnell felt strongly about that. this is a broad base public- private partnership that is less about the government pushing information out, which is how -pthe government thinks about public-private partnerships. it is a dialogue. >> are you saying that, say cisco or google should collaborate with the u.s.+ government? >> there have got to be rules. the first thing my colleagues -- when i share information, we're not doing untoward things with the federal government. i am not suggesting they should be doing that sort of stuff. i am talking about sharing the intellectual capital. >> they should not -- >> there have to be rules and

understandings. there is a legitimate debate to be had about public-private partnership. i said why does the industry not do it? they are reluctant. they will be perceived as some sort of unholy alliance with the ggvernment. you have got to find a way to have that dialogue. it is not being had. >> do we have to have a week of call in surber security? >> my great fear -- i hope i'm wrong. my great fear is we are not going to see real progress in this area until there is some sort of cataclysmic 9/11 event. >> what is your nightmare? >> my two. why llmit yourself?

one is the financial system. i hasten to add that the many3 among the most sophisticated. they are reluctant to share information with the government reasons. the other is in a transportation or electricity sector. imagine your air traffic control system going down because someone has taken it down or the lights going on out. we played through the exercise as lights are going out across the northeast. >> with the creation of the department of homeland security -- was the creation of the department of homeland security a dumb idea? >> michael, durso for this question. i do not think it was a dumb idea. -- michael, prepare yourself for thissquestion.

because as i said earlier, when you decide to sell the big problem in a singll step, it does not always go smoothly. what we wanted in the department was the border agency that looked at people and things across borders. imagine a smaller scope department that started their. -- there. >> you could have added things. the department has overcome the challenge of trying to do too much. we heard the deputy secretary say we are not in the first year seven times in a row. i think we might have seen some of those gains if they were done more modestly. it was the right idea. >> do dhs and the fbi still cy lote information and not cooperate? >-- silo information and not

cooperate? >> i think people hide behind rules that allow them to keep information at of the system more away from one another. i think they are getting better. this is part of, enough will, you can solve this problem. dhs has got information the fbi wants and has trouble getting access to. to be fair, i do not think this is all on the fbi. it is on both sides. they want to saba, they cannot get out of their own way. >>-- solve it, they cannot get t of their own way. post 9/11, this has been an agency that has undergone a good deal of cultural change. i hate that sort of race. it has this new national

security division. -- i hate that sort of phrase. they are grwoinowing agents. ttat is a work in progress. there is a cultural shift inside the bureau. as with any big organization, they will go through growing pains. you have the department of homeland security that is neeson. this i-- nascent. it is fighting for its place at the policy table. that contributes to an environmenttwhere they find it difficult to understand each other and share. i think we have to be realistic about what the circumstances are that they are in. >> do you want to add to that or there is a microphone being run

to you. >>we will come back to the point where fran made earlier. >> i do not think the problem is so much a question of the wiring diagram. people are saying this is share. going to these huge fields of data and figuring out what is important enough to share and what is the priooity and not the party to share. people get swamped with information. they do not understand what is valuable to other people. that is what the challenge is. fran put a finger on it. the way you overcome that is by driving it frrm the top. making it clear what the priority missions are. if your prioritt mission is i

want to know about any reasonable thheat that is out there in short to medium term and you drive the organizations to handle their data and exchange and focus on, that is your outcome, if you do that relentlessly, we had the president and if there was an unanswered question in the morning, by the afternoon, you had better have an answer. that is what drives organizations. otherwise, they lapse into habits of behavior. they can miss things that ought to be caught. >> keep the microphone if you would. >> i think we ought to get to a place where it does not require in my perfect world -- it does not require the meeting in the oval office.

three times a day videoconferences -- you can speak to this. we do not need to call to ask did we answer that question? you can develop a system that allows you, you can said those priorities that have thosthat hn without a conscious thought process. human beings are busy and they will make mistakes. you can reduce the likelihood they will miss a critical piece of information. i think we will need to evolve to the next level. >> could we have an information system -- both of you could address it. in which state and local governments, the fbi, and dhs are expected to put into one information system? >> you could do that.

they had the idea in l.a. beginning a program of suspicious activity reporting. we have been talking about intelligence. most people are thinking afghanistan or pakistan, what we're getting from satellites or spies. you are getting this from the streets of our city. bill and people in l.a. with this together. suspicious activity reporting. not simply haven't come into one -- have it come into one place but creating network servers giving any company in the country to look at what was+ flown in. the fbi has an opportunity to do that but not to be a gate keeper. to allow the information to be available to everyeveryone.

i think that caused some negative reaction from people who believe that every time you collect or gogot information, we were on the road to totalitarianism. if you can overcome that knee- jerk reaction, a combination of redistribution of the data over networks systems and the kind of analytic tools that allows you to set the data in real time, using algorithms and data mining, data analysis, that is how you get that issue. you have to get that in place. >> when you put the airline reservation system in that, too ? >> you would like to be able to add that in. what we would like to see as the federal government looks at the

national intelligence system and seize certain threats emerging. that has the -- got to go down to the centers. they make sure they understand where the threat is coming from and collect. getting it back in -- the federal government loves forms. this has to be absolutely easy for the guy and his crews. he is done putting in that information and you have to distribute and analysis. the federal goverrment has the ability to look at it and discern patterns and share that back. we are getting their but we're not there yet. >> suppose somebody in closure city -- bozier city buys fertilizer and strange chemicals

and a local copper ransom. does that go into a data system somewhere? >> that goes into the fusion center. >> do we have that? >> we built them and they are working. not all of them are equal. not all of them have the same capability. it is the first one where you can get this information and push it back in both directions. >> i do not know where we are with the microphones. >> i am going to ask the impolitic question because you work for it. -- you are up for it. you have a lot of carryover in the current obama

administration and the ct community. one of the staffers helped the organization. they are aware of those problems. still trying to fix them. are you saying that abdulmutallab's attack would not have happened under the previous administration? were the have not kept up the pace from the oval office to drive the agencies to do what you were doing to marshal this information together. >> i do not like the choices she is giving me. i am not saying it was not a priority. it is confident this is not about a political viewed world or political party. if it was going to happen, it would not matter who is in the oval office. i have been concerned about the

time and attention against this issue. i will be honest. i struggled to get time and attention for this issue when i was in john brennan's seat and i understand the struggle that can be. it is hard. that is why you need sommbody -- i do not think you what the person in that seat. it needs to be someone who was full time dedicated, cross government job is -- their job is to solve this problem. i am not satisfied with the amount of time and attention. in some ways, we have not organized ourselves right to give this the president and party it requires. >> -- presidenand preprecedent

is required. >> there is no way that humans with the number and variety of signals can set a constant agenda on their own. therefore, in our company, we are working on solutions which set up an intelligence agenda. i support the point that you made and this way, you can cope there. >> talking to mike, there are so many dots, you cannot make sense of hem. you cannot understand them. you cannot comprehend the mall. which is what you need the system to organize that. -- you cannot comprehend them all. which is why i need the system to organize that.

>>-- why you need the system to organize that. >> i will tell you we have been involved in the orgainformation initiativinformation sharing. it consists of 280 jurisdictions aaross four states. there is a challenge. they are asking for nothing more than a indemnifying themselves for an agent ms. uses that information if they do not have liability associated. the response is we do not indemnify. there is a quarter of a billion records that are noo getting to where they need to get to long-

term because of issues regarding something as simple as indemnification is used. in city councils and local attorneys will say, why should we take the risk of sharing this information if we have a liability associated with it? >> that is a failure of leadership. straight and simple. there is no good come back to that. that should not be and somebody in the federal government whether it is dhs or the justice department, needs to give comfort to the state and locals willing to provide that information. that should not be and that is a failure of leadership. for those of you wondering, i said the same thing about was in the executive branch. -- if i was in the executive branch. >> way back there.

>> our conversation today and right now seems to be focused on state actors, but we are ignoring other domestic terrorism groups. i was wondering if you would speak to what efforts are needed. >> you are talking about environmental groups and that sort of thing? i want to make sure i address your question. >> [inaudible] >> yeah. i was surprised. folks would say, how often did those sorts of things come up? it is not what you hear about

publicly. i was surprised at the number of events. intended to be at the -- it tended to be at the side. burning down a housing development or crossing a wire. there are more of those than most americans appreciate. their units devoted to nothing else in the fbi. they do not talk about it as much. i will tell you there are -- people would be surprised at the amount of resources, including the local joint terrorism task forces around the country. this is a problem that is greater in some places but not a problem i and others. where there is a problem, the joint terrorist task forces are penetrating those groups in the use the same techniques you would use against international terrorism. >> right behind you.

>> sticking with the deja vu all over again, and on the narrow question, we mentioned the continued difficulties of fbi sharing information. thank you for your observation about it going both ways for once. what i thought was a pretty comprehensive report from senator feinstein's intelligence committee identifying the failures to detect the christmas day bombing was mention of, again, the fbi boss inability to communicate within itself as a systemic failure.

time and time again, we have heard about these problems. the fbi coming into the 21st century. what is your observation and what will it take to have them get it right? >> i do put this in the category of information sharing and my frustration about it. we happened to be in the oval office where there was a report that after more than $100 billion spent, the system there were planning to implement was not going to work. part of that is explained by a lack of expertise inside the system and the fbi itself in terms of the information technology. that is not an excuse. let's remember, if we're looking at a failure in sharing of information, there was a failure

to share information between dot and the fbi with the fort hood shooting. it is a broad problem. director moeller -- muller has invested a good deal of time on this. i do not have visibility into what the improvements have or have been. i have always worried about the system. this is a system that is case driven. if you file everything in no according to a case number, there is intelligence in their that maybe related to a report ingroup or individual. that is the fundamental problem to me. even if they have the best

case management system in the world. if they do not -- until they solve the problem that will not know what they know. that is worth the long-term investment. >> would you bring the microphone up, please? >> there are probably 20 people here in aspen this week who could help the fbi solve the problem quickly. from the private sector. what frustrates me in thinking about this, because we heard these apologies repeatedly and an expenditure of more than $100 billion over time. it is not yet fixed. what does it take? does it take the president of the united states to bring in a task force? who is going to get this right

side? >> i am a great believer in setting clear priorities and accountability. i think there is a good argument to be made for the president to decide he is very clearly going to task the fbi with solving this problem and directing them to bring in the outside help they need. the government has never been good at public-private partnerships, even modest ones. we're trying to -- get better at it. -pthey're acting in good faith. this is the kind of question when it comes to information and need outside help with that they have to bring in. you are right. it has to be solved or we will have another event where we will find something in the fbi case file that did not get share because they did not know they had it. >> let me follow-up. is part of the problem -- the

public is so afraid of total information awareness and information sharing that we get kind of paranoid about it. we have not educated the public well enough. >> that is right. people in washington watch one scandal after another. those of us who have watched this issue have all remembered the case of john poindexter and watched what happened to his career. a republic servant who was trying new and creative things. -- a public servant who was trying new and creative things. in thiis their way to bring than and set the policy rules that allow you to take advantage of them? the questiothis requires hard wy people like richard and others who understand.

>> there is a constituency with3 constituency. even knee-jerk among the public. there is no constituency in the other direction that says share information. >> part of that is because the natural constituency on the other side are in government. there in the executive branch. when they make that argumenn, they get accused of totalitarianism. phat is white you need an non- governmental form where you can have this conversation. -- why youuneed an non- governmental former you can have this conversation. they view privacy as a non issue. i am not worried about privacy

and i'd but information out there every day and i do not know who was looking at it -- i day and i do not know who is looking at it. >> we in the back there. >> --- way in the back. >> two questions. when the executive order was issued, that was a double-edged sword. the good news is it has private- sector average requirements. the bad news it has private sector outreach requirements. if every agency in the government starts getting engaged out there and start checking the box that they havv

their private-sector outreach program in place, how do we get the government into a coordinated fashion so the private sector is not inundated government doing their average programs? >-- outreach programs? >> i will tell you this came up for me in the context of fbi, who may be going out to have a private sector relationship, they may be going out to service subpoena. the cia, wwo has a private sector program, and dhs was greeting the sector coordinating council's. it as a group of ceos who said someone comes in and talks about my general counsel and someone invites me to dinner. little did i know that i would get pitched. i called the cabinet secretaries

together and we had a conversation. their interests and objectives and those relationships are different. you do not want to be in a position appearing [unintelligible] my notion is, is there a system that allows us to gatekeep? there are concerned with suchha system. i tried and failed but i get it. i get that we need the governmeet -- the government needs to do this better. i hear this all the time. we need to engage with the business roundtable and ceos to understand what is their view of how we can do this more effectively. >> the following i have is, as you mentioned earlier, the c

onsistent attacks. the overnment kkows there is 140 country stealing technology. the obama administration issued their report ssying that over $1 trillion conservatively was stolen from the economy from intellectual property in 2008 alone. when i broke this question to the director of national intelligence, he said it is somewhere between stopping global hunger and world peace in trying to fix this problem. how do we get the resources of the government focused on understanding that?? we're one of the few elements in the domestic, developed world that does not have an industrial policy. you cannot build five business all the time. you have to have business to support the long-term growth of the country. >> you are dead on. the legal authorities exist to

prosecute these. i am a firm believer on this. an occasional indictment is not a bad thing. we need a concerted effort. against the economic crimes, especially in a time of economic uncertainty. when better to decide to launch such an initiative? it is the question of competing priorities. demands on resources. it is necessary and can be done in a way that gets a lot of attention to this issue. >> last two questions. up front. >first with the guy in yellow. i have to get fran out at two.

>> we have heard about how americans have to pitch in for our security. we have a host of foreign countries that we plan. you have a lot of experience. i wonder if you could characterize, who do you think and why are our foreign pprtners important to us in fighting al qaeda? who wore the strange friends we can talk about besides the traditional allies? >> we understood and bbll was part of this. after 9/11, the closest ally was the british. you have to go to the places and create allies where the problem existed. that was not easy.

there was a deep sense of mistrust and suspicion. you are talking about saudi arabia. people would be stunned when you realize that 15 of the 19 hijackers were saudi. if i told you we share thousands of intelligence reports of the year with them, rivaling our counter-terrorism relationship with their british allies, people would be surprised. a good deal of this is the saudis see the threat to themselves and see it in their own national interest to collaborate with us. that is not a bad thing.. what they cooperate is less important than that they do. i ttink you're seeing this -- we need to get to a point where you are doing that in a place like dimon. we need to get to a place where there is no central government. the threatyou have to go in ande

capability that they do not have. they provide the capability so they can share. those are long-term and their expense of commitments. make no mistake. but they are invaluable in terms of intelligence that they provide. >> i wanted to thank secretary chertoff. the privacy issues may be less than we think. in light of that, what are the biggest remaining hurdles? the two that i see are how do get data to find data without being flooded? you talked about artificial intelligence and alerts. how'd you get that to happen?

how do you get it to happen. together they when the owners of data -- particularly when the owners of data say i would like to share it but i cannot. you cannot look at the data without a predicate. >> we have to get over the traditional rules. it is -- it cannot be ok to say i would like to share but i cannot. tell me why we can and we will solve the problem. we have to challenge those i cannots and solve them. i don' t think we have taken a hard enough turn. whether it is the eu or state and local regulatory agencies

that require it for different purposes. those can be solved. it requires the hard work of deciding you are going to do t and you will be public. you have to be honest about what the rules of the road are your operating under and give yourself over. congressional oversight, i will take a 10 second screen on. it is dysfunctional. the department gets pulled in a thousand different directions. good oversight can be put against us in a responsible way that helps solve the problem. >> can be solved all the ones or one by one? >>-- can it be solved all at one or one by one? >> i think you have a disciplined system to go against each of them. >> there is a gentleman i passed a way back there. last question. >> in regard to the statement

about intellectual property, i am interested in your thoughts. have the politicians not picked up on the fact that this is an american jobs lost issue? i have rarely if ever heard anything about that. i am interested in your thoughts. >> this is not a good answer. it comes down to an answer of priorities and resources. people worry about stuff blowing up. no one wants to take agents of the ct watchs. agents, we can move resources around. we have to make up our minds to devote resources.

the chamber of commerce has a private sector. they did the investigation themselves and they bring it to the government but they cannot get the government interested to do its fundamental job. that is a problem. that ought to be an embarrassment to the justice department and the fbi. we need to bring a couple of big cases. look what hollywood does. hollywood does this effort against fraud. while that is important, that does not abrogate the government's responsibility. i will take a second to -- this is an important opportunity. these conversations do not get had absent of the institute. thanks for the effort that went into it. this is terrific that you have

been willing to do it. there is interest to continue it. it is important. >> thank you very much. [applause] > >> coming up tonight. from the white house, president obama talks about efforts to promote u.s. exports. a discussion of how terrorism is viewed outside the united states. later, the heritage foundation reviews the concluded supreme court term. >> book tv continues all this week in prime time. tonight, with a focus on economic issues. mohammad yunus wrotes about

social business. also just a stieglitz -- joseph stieglitz talks about the economic collapse. all this week on c-span2. >> c-span is a public service greeted by america's caale companies. >> at the white house today, president obama talked about efforts to promote exports and progress on his campaign pledge to double u.s. exports. we will hear first from the commerce secretary. this is 25 minutes. [applause]

>> good afterroon. thank you for joining us. we had a candid discussion about the strategies to meet the economic imperative with selling more u.s. goods and services overseas and how we can strengthen the impact of president obama's national export initiative. after a decade in which america's economy look relied too much on an increasingly hard-pressed american consumer for growth, president obama understands we need to get back to the basics trade he believes we must free invest in innovation and do a better job of connecting u.s. companies to the world's consumers who live outside the borders of the united states. that is where the national export initiative comes in. it is an effort to redouble american exports by 2015.

the goal is to double exports by 2015. it is to put americans back to work i in jobs that provide -- in jobs that provide dignity and security. these are good jobs that provide good wages. the type of jobs that we need more of. exports in the first quarter of 2010 rose 17% from the year before. over the last nine months, exports have contributed as much as domestic consumption to america's economic growth. credit goes to improving the global economy and american companies that provide the best products and the most saw after services in the orld. our companies also have been helped along by a federal

government that has fully mobilized to improve our advocacy on behalf of u.s. companies. at the same time, we are increasing access to credit, export credit, and breaking down the trade barriers that prevent u.s. companies from operating on a level playing field. i am proud that the u.s. commerce department has been involved with many of these efforts, and the president has made the national export initiative such a high priority. i would like everyone involved in this effort [unintelligible] i will turn things over. it is my pleasure to introduce president barack obama, who was accompanied by my friend, the expert counsel co-chair. ladies and gentlemen, the president of the united states. [applause]

>> thank you. have a seat. thank you very much. please be seated. good morning. thank you for being here and thank you to members of my cabinet and my administration for coming. thank you for the introduction and the outstanding work you have been doing in congress. that work has been my driving focus since we walked through these doors a year-and-a-half ago. at that time, our economy was shrinking at an alarming rate. nearly 3 million jobs were lost in the last half of 2008. in january, 2009 alone, more

than 750,000 jobs have been lost in the united states. every alarm bell was ringing at the prospect of a second great depression. our imperative was to stop that free-fall and reverse direction. to get our economy moving and get jobs growing again. which meant we took a series of dramatic and frankly, sometimes unpopular actions. as a result of those actions, we broke the recession's momentum and we're in a much different place today. our economy has grown for three consecutive quarters. a stark contrast to the 3.7 wheat lost over the first half of last year. -- we lost over the first half of last year. despite world's even events, w'e

moving forward. our businesses are hiring again. there are five unemployed workers for each job opening. empty storefronts still haunt too many mean streets. the truth is the middle class families that are the backbone of our economy have felt their economic security eroding since long before this recession hit. we have got much more work to do to spur job grooth and keep the economy moving. the question is, over the months and years to come, how to win courage the strong and lasting economic growth required for america to lead in this new century? where are we going to find the growth to boost businesses and

workers and improve our fiscal health and reducing our long term deficits? one thing we know is this growth will not come from an economy where prosperity is based on fleeting bubbles. of consumption, debt, you cannot rely on paper gains. we have seen where that led us and we're not oing back. the truth is, we have had to face of a the past year and a half -- over the past year and a half, if we want to approach full employment and fuel economic growth, we need to end the policies that got us here, tackle the challenges we have put off for decades, and move this economy forward. we need to lay a new and stronger foundation on which businesses can thrive and create jobs and rising incomes, on which innovators and entrepreneurs can lead the world in generating new technologies

and products and services. we have to rely on a new foundation on which america can harness what has made our economy the engine and the envy of the world, the talent and drive and creativity of our people. so as business leaders and labor leaders representing some of america's largest corporations and america's workers, that is what i want to talk to you about today. because america's success all smugly depends on your success. it is the private sector that has always been the source of our job creation, our economic growth, and our prosperity. it is our businesses and workers who will take the reins of this recovery and lead us forward. same time, some might argue that government has no role to play it all in our economy. but everybody in this room understands that the free market depends on a governmenn that sets clear rules that insure fair and honest competition,

that lives within its means, that invests in certain things that the private sector cannot invest on its own. in the absence of this kind of responsible government, whenever government is dragged to 421 and or the other of the spectrum -- dragged too far to one end or the other of the spectrum, we see negative consequences. too much regulation can hurt business and families. a government that does too little can be just as irresponsible as the government that does too much. because, for example, in the absence of sound oversight, responsible businesses are forced to compete against unscrupulous and underhanded businesses who are unencumbered by any restrictions on activities that might harm the environment, or take advantage of middle-class families, or

threaten to bring down the entire financial system. that is bad for everybody. that is the reason we pursued wall street reforms. and when the senate takes up its business again, i hope the move as quickly as possible to finish this chapter and settle this issue. in the absence of sensible policies that invest in long- term public goods like education our basic research, roads, railways, broadband, a smart electric grid, an absence of those investments can equally disastrous. over time, failure to make such investments slowly degrades our competitiveness, leaving us without the skilled work force for the technologies or the basic infrastructure that a 21st century economy requires. so to make sure our workers can out compete anybody, anywhere in the world, we have iivested in the skills and education in --

of our people. through the race to the top, we are challenging our schools to raise their standards. i have pledged that by 20/20, america will lead the world in the percentage of students graduating from college, and by making higher education more affordabll, we're on our way to achieving that goal. to strengthen our standing in a 21st century economy, we have invested in upgrading our critical infrastructure, from high-speed rail to high-speed internet. we have enacted reforms that will reduce the drag of health- care costs on businesses and consumers. we are committed to bringing down the unsustainable debt that has ballooned over the past 10 years. to spur lasting growth, we have invested in science and -ptechnology. research and development. clean energy projects that will strengthen our global leadership. 18 months ago, american companies commanded 2% of the globallyglobal capacity for besy

technology. the money we provided has leveraged private investment and by 2012, we expect america's capacity to reach 20% of the global market. as high as 40% in 2015. government has another responsibility. that is to remove barriers that stand in the way of opportunity and prosperity so that our people, all our people, our workers, our entrepreneurs, our ceos, can build the future that we seek. that is what i want to focus on now. in my state of the union address, i set a goal for america. over the next five years, we will double our exports of goods and services around the world. an increase that will boost economic growth and support millions of american jobs in a manner that is deficit friendly. export growth leads to job

growth and economic growth. in 2008, american exports accounted for 7% of our total employment. one in three manufacturing jobs, and supported 10.3 million jobs in all. jobs that pay 15% more than average. so the time when jobs are in short supply, building exports is an imperative. this is not just about where jobs are at stake. this is where american jobs will be tomorrow. 95% of the world's customers and fastest-growing markets are beyond our borders. if we want to find new growth streams, if you want to find new markets and new opportunity, we have got to compete for those new customers, because other nations are competing for those new customers. as i have said many times, the

united states of america should not, cannot, will not, played for second place. we mean to compete for those jobs and we mean to win. we are going to change how we do business. to meet this goal, we launched the national export initiative. an ambitious effort to team up with america's businesses, large and small, and help them unleased their energy and innovation, grow their markets, support new jobs selling their goods and services all across the globe. and we're bringing to bear the full resources of the united states government. one of the first things we did was establish an export promotion cabinet made up of cabinet members and senior administration officials whose work affects exports. i assembled this cabinet for an update on our efforts so far. we're going to hold these we're going to hold these