[captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] host: gop senator olympia snowe now says she will vote in favor of the financial regulations bill in the senate. that makes three republicans. that means the leadership on the democratic side might have 60. a final vote is possible by the end of this week. senate democratic leaders had over to the white house for a meeting with the president and vice president. they will talk about the agenda. this afternoon the president unveils his national strategy on

aids. testing will be the focus. there will be voting in alabama. primary run off for governor's race. also looking at the second district u.s. house race. we have this question on this tuesday morning. do you have faith in president obama and congress? a new poll is out and the numbers do not look good. do you have faith in president obama and congress? it is the off-lead story in "the washington post." here is a deadline -- six in 10 americans lack faith in obama. but they talk about congress as well.

here are some of the numbers. if the camera moves over, there is a pie chart. how much confidence do you have in these various folks to make the right decisions for the country's future? just or maybe no faith -- president obama, 58% said no faith or just some. there is that six out of 10. as far as democrats in congress, 60% of folks say they just have just some or no faith in the democrats -- 62%. and the republicans weigh in at 72%, some say -- just some or no faith. we will get to your calls on this in a couple of minutes, but we do want to give you an

update on the agenda in the senate. david drucker, staff writer ed "roll call." 3 republican votes, is there enough to get this done this week? guest: i am still not sure because charles grassley, republican from iowa, he voted for the bill on final passage, not support the bill on the cloture version, he voted with republicans to continue to filibuster. because they are still -- the democrats are still down a bow -- a vote with robert byrd's passing, it is still unclear whether they have enough votes for cloture. host: what happens now if you are senator harry reid? what is your approach? guest: it could be to wait until next week. the governor of west virginia

said he will appoint a replacement i believe by this coming sunday. which means we could have a new senator next week. and that vote could be all it takes to get this thing done. the democrats do now have the support of senator maria cantwell. she was against the regulatory reform bill, the first version that cleared the senate. she said she will support the conference report. so, next week, the could be ready to go. host: financial regulation just one of many bills out there. take a step back and speak about this senate agenda. three, four weeks left before the august break. what else will the majority like to get done? host: -- guest: the majority would like to get a lot done but i am not sure what they will accomplish. they will confirm elena kagan.

republicans will stretch the time limit, but they will confirm her. in my view. i know that senate democratic leaders are supposed to meet with the president today at the white house. i am sure they are going to be discussing energy, climate change, and immigration. things the president wants and harry reid said he would like to do. we will see how far they could get on any of these measures. i just don't see major comprehensive reform legislation on any front -- climate change, energy -- getting done before the election. whether talking before the august recess or after the august recess. you have just been going over poll numbers. it is hard to get major political things done in an election year, particularly in a situation like this with the democrats are running scared and

little bit, republicans feel emboldened. that is not a good environment to compromise on major and thorny issues. i do not know how much major we can get done this work period, other than possibly a jobs bill. but there has not even bid -- even been a good environment for that. host: thank you for the update this morning. our question of the morning -- do you have faith in president obama and congress. here is the headline in "the washington post." 6 out of 10 americans lack faith in obama and congress is not doing much better. pensacola, florida. democratic line. curtis, what do you say? caller: i would like to make a point. i wish you all would be a little more truthful with the public when you say that taxes do pay the fee to keep you on the air. to me, it is a good republican ploy, a user fee, because don't you take money from my bill to

finance your program? i wish you would make that point of because it is a republican ploy. back to your question. i have faith in obama. but i think the -- what do you call it -- a slanted question because you added congress because congress to make, the democrats are trying and the republicans all they know is one word, a two-letter word. i am a marine corps veteran and i feel like the republican agenda has destroyed my country. an example -- i went to the va clinic and had some issues, and they were related to my vietnam experience. and one of the procedures was not related because it was not in my record as a va benefit. you know they charge my insurance company?

i called the va and dino what their response was? host: go ahead and tell us. caller: it is a lot. veterans, and issue that they feel let -- excuse me? they feel like -- that is an example of republican agenda. they preach that they are for the military but when it comes to benefits for military families and va -- and passed military, they don't do it. host: the view from curtis in pensacola, florida. republican line. jeremy, annapolis, maryland. do you have faith in president obama and/or congress? what do you think? hello, jeremy? go ahead, paul, from annapolis. caller: how are you doing? i definitely have faith in president obama.

i think the american people are too impatient. to make a change in our economy and country -- to expect that it could be done in less than a year, or a year, it is just ridiculous. host: what is your own situation in terms of jobs and the economy and that kind of thing, and what do you make of folks who might be jobless, losing homes, can't get loans? caller: the actual -- 75%. think that the solution is to totally they'll a year and a half and -- bail a year-and-a-half in and say a whole year and half north dakota largest economic cataclysm -- a

whole year and a half in the largest economic cataclysm. host: now i have jeremy on the line, republican. caller: yes, i am. to your two previous callers, the first one, curtis, if you are so dissatisfied with the va system, you can take an inner tube and flew to cuba and see how you like their health care system. as far as the guy who called before me just previous to meet, he says that he has stayed in obama yet his in, is down 75%. i don't even know how to respond to that other than say that he is an abject idiots. i have no faith in our barack obama. i have no faith and a democrat congress. and the only thing that will save us, november is a complete takeover of the house of representatives and senate of the united states.

host: let me jump in and show- biz figure. again, this is according to "of the post" and abc. republicans in congress, 72% say they have just some or no faith in the gop. what do you say? caller: the only thing i would say to that is, look what you have got now. wait until 2011 when the tax increases kick in. wait until everybody takes their profits at the end of the year -- all the corporations, everybody is going to take their profits, and they are not going to invest a dime in this economy in 2011 because their tax rates are going to jump exponentially. host: broad, negative sentiment, writes the piece --

one more graphic, here -- tallahassee, florida. philip, democrats line. thanks for waiting. caller: i don't have any confidence in president obama or the democratically-led congress, and i am a democrat and i have been since 1961. i just don't feel they are leading the nation in the right direction.

i think the direction they are leading it in is a hidden from us by telling us what they want to do -- telling us what they want on the tv and in public and then behind the scenes of the are trying to lead this nation in an entirely different direction. host: economic worries continue to frame but -- congressional campaigns. they go on to say -- riverside, california. back to the independent line. you have faith? caller: no, i do not. i have defined out the reason

why -- i think he should act to be put in jail for treason. host: why? guest: bribing senators, trying to get his own people and office, fighting arizona. host: does it extend to congress? caller: yes, sir. host: go ahead. caller: i feel that congress and mr. obama are leading the country in the wrong direction. host: what is the answer? caller: i feel we need a whole new congress and a whole new president. host: let us hear from lamar, a republican from brunswick, georgia. caller: i say amen to the guy that just called in. i am going to tell you something. i have no confidence in the president, zero. the only thing i ever see him do is fly around, burn up our tax money in the plane, and as far as i am concerned, lying, lying.

my biggest fear is that the black panthers, the way they are talking now -- at lot of people don't see it on the other channels but just go on 50 and you will see the truth. i am going to say one more thing. my only fear is that obama, instead of going down to florida and checking on the oil, he is going to go down and meet the terrorists one day and welcome them to our shores. host: dennis, a democrat, marlboro, maryland. what is your faith in the president and congress these days? caller: first of all, i have complete faith in our president. you know, the guy just before me evil sounding and racist sounding that i did not even want to address that. i mean, americans out here are gone ignorance.

if obama was a white american and had taken on all of this mess that the republicans left us in the last eight years he would be heralded as one of the greatest presidents of this country has ever seen. people have got to admit -- and people out in the hinterlands, we know it is pure racism. when you vote against your own interest, of the tea party, that kind of thing, they want to get rid of their own social security, in a lot of cases. they want to cut off their own noses despite their faces. america, wake up. you are still a racist society in a large segment and the worst is coming out. maybe this is a godsend that we

can finally drain all of this nasty racism out of our culture, out of this great nation, just like we tapped the bow -- capped the well this morning. you know, people, you've got to be crazy to vote for a republican congress that literally destroyed this country. host: thanks for calling. here is the headline once again in "the post." they do point out that congress is still held in lower esteem. but the poll shows the gap narrowing between the presidents and congress. moving closer in terms of a lack of faith. upcoming segment in this show include small business and jobs. we will talk to tom davis, part of the republican main street

partnership, former congressman and former head of nrcc who help the republicans get elected in the house. we will talk about the future of the postal service, its debt, and the potential prize because -- rise in the cost of stamps. oil companies still at risk for another catastrophic spill, announced "washington times." that is in a "the washington times" this morning just before the fall. and "the times-picayune" --

there is a photo. an image taken from video, a new, tighter-fitting container cap. it is the lord over the broken wellhead. that -- lowered over the broken wall had. donna, independent. your faith in president obama and congress. caller: good morning. i don't know if it is somewhat -- so much as a faith but i do have patience to wait and see what happens. you just can't solve a lot of problems quickly. and there are a lot of problems our country is facing. instead of going in this direction or that direction, we really need to pull together. i am disappointed with republican rebels representatives, flat refusal to cooperate. that is a hindrance. democrat rep also who are not

working with the president to help to get the agenda -- this country where it needs to be. host: how quick is too quick? how much time should this take? there is a midterm election coming. caller: you can't keep putting people in office, keep putting people in office but about making commitments to them and making sure that they understand that you want them to be committed to you. my family and friends are making a concerted effort to let the representatives running in our area in georgia, that we are holding them accountable and we want them to answer to us -- not to the people who come and help -- what do you call those people who give congress money? i can't think of that right now. to vote for their agenda? lobbyists. host: lobbyists. caller: i think it would be great if we could have accounting for each and every dime that each congressman

received from lobbyists. host: miami, florida. richard, republican line. your level of faith. caller: i have a lack of faith in this president. i think his policies are very reckless and dangerous. he has increased the size of government 45%, spending trillions of dollars into debt and shrinking the size of small business. confidence in his choice of his inner circle. and also what bothers me probably the most from the beginning is the man is for partial birth abortion -- if you can't get that right, i can trust his opinion on anything. thank you very much. host: martin of the democrats' line from fairfield, california. i think we lost martin. let's try henry, independent.

hot springs village, alaska. go ahead. is it alaska or arkansas? caller: arkansas. good morning. i am an 86-year-old veteran. you know, i went through the great depression. and i see this country going as bad as it has ever been, as bad as it has ever been. my theory and the whole thing -- and i don't trust the government anymore. my whole perception of what has to be done is we have to go through an hourly paid congress, so when they don't come up to standards, they should be fired just like an employee from a corporation. you know, this is -- ridiculous, we can keep people in office when they are not worth a dime.

until they change the system of the congress and how they operate, this country is going to keep going down hill because there is too much corruption. we have to have a referendum, a vote on lobbying and get them out of the white house or get them out of washington completely. host: independent caller, henry, from arkansas. our twitter address is c-span- wj. here is one -- back to the oil drilling story, the second editorial in "the wall street journal" today. the new-old drilling ban. salazar to gulf workers -- moved to egypt.

he goes on to write at the end of the piece -- "the financial times" front page, one more oil story. $10 billion less they will pay in taxes over the next four years.

they are basically saying here that the cost of the spill cleaned up can't be written off against tax, so they will save $10 billion over four years according to "the financial times." buffalo, new york. a republican line. your faith in congress and the present. caller: i have no faith in president obama or congress right now. i know there are a few congressmen that i think are doing a good job. paul ryan would be one of them. i can't say the same unfortunately for my senators. i have no representation right now because eric massa was my representation and unfortunately we have no special election, nobody is an office and i feel mired and bob down because i have no one to speak for me from my district. my faith in a president obama was a -- there are some decisions that i support him in, but there are some things i have

seen him do that i just cannot support. his treatment of the military being one of them. the latest decision to fire general mcchrystal, i did not support that at all because i think the article that was written about him was basically a character assassination job. host: let me throw this gop number at you, again,t, the post -- th -- e post." only 70% of voters having just some or even non. what did your best argument for the gop to be in charge? caller: is to get new blood. in every situation you need to get the career politicians out of office. we need to get people who will be able to make decisions based on what needs to be done for the people and not partisan politics. host: here is one e-mail this morning.

let's go to michigan, democratic caller. is it agnes? caller: yes, i do have faith in obama and the democrats. it is just that everything he is trying to do to go forward, the republicans are always trying to stop it. i am looking at, when they have the disaster over there in new orleans, they were giving out billions of dollars to help them. now it is a disaster in the united states with all of these unemployed workers to pay their bills and the republicans don't see it because the only thing they are looking at is grabbing a seat. i am just saying that -- we used to be workers. it is not our fault the jobs have left us and all like that.

they need to help american people. the republicans, it is all about getting seats and taking over. that is the reason why when they voted for a new president because they got tired of what was going on with the bush and stuff and now they see a weak spot with the unemployed with no jobs -- instead of working together, working against obama and the democrats and it is all about the granting seats in november. they don't care. they don't have no heart. it is all about them grabbing seats and being in charge. how can you work and try to go forward while you've got people trying to stop you, and some of the callers i am listening to and stuff, half of them is all about because he is a black man. it is not because he is a democrat. it is because they -- he is a

black man and some have of the hatred. host: let us move on to highpoint, north carolina, give joe a chance. you are calling on independent line. new hampshire chat -- poll says lack of faith in the president and congress at the same time. what is your view? caller: it takes about eight good years to be in this problem and it is going to take some time. three or four years to dig us out from of problems the republican cause. you've got to give him time. i hope this would be better. it takes some time to get us here and it will take time to get us out. host: the lead story in "the washington times" today. gop poised to grab control at the state levels. democrats in danger of losing legislatures. when it rains, it pours, they

write as the lead. this is according to a comprehensive analysis. the lead story in "the washington times." here is a piece in "the wall street journal" on medicaid and congress. stalemate testing cash hungry states. federal stalemate over funding for the poor moves on even as states face mandates to extend the program under the new health-care law.

that is an "the wall street journal". republican, dave. caller: i am not very optimistic about the president and congress. they are to boxed up and their liberal and socialism program. i am a veteran that has 18 and a half years and i am totally disabled, and people think that i was given disability -- excuse me, i earned it through a 10 1/2 years of service to my country -- 18 and a half years of service to my country. if people were to invade this country, i would still pick up arms to defend this country. so, people need to get off of this that they are just giving us veterans benefits. the problem is, we have become too polarized over party,

republicans and democrats. we need to knock the nonsense of and become americans again. host: albuquerque, new mexico, democrat, wayne, what is your level of faith here? guest: i have a great level of faith in our president. i think that he is a very articulate and thoughtful man what people seem to fail to realize is he was elected by a mandate. he did not squeak by like the previous administration dared will govern like they had a mandate. and then bush came in and there were these tax breaks and these wars and you wonder why the economy is in the state it is in. president obama is not a magician. he cannot just wave a magic wand. there is a reason why the gop has a favorable rating and that is a glaring thing because you want people like john maynard in there? they are not going to represent a working person's interests. it is all vitriolic anti back. i agree, but probably is an

element of racism. host: program notes for c-span 3, our companion network. 10:00 a.m. eastern time, senate judiciary will meet, the call it an executive -- to take a vote on elena kagan nomination. we will hear the republicans will ask for a one-week delay. they are likely to get it. that will put it to next week to vote in committee and if they pass it there that will go to the floor. 10:00 on c-span 3 bit later today, 2:00 p.m. eastern on c- span 3, the white house will unveil its national aids strategy. here is a piece on "usa today." it will focus on new infections and testing. they write --

the president will lay it all out today. we will also have live reaction at 3:30 p.m. to all of this from the group called the aids healthcare foundation. new york, republican, rich, good morning. caller: good morning? host: i am doing fine. caller: pretty good. i am sorry to say, i have zero space in this president and the administration. host: why? caller: we don't need a liberal tax and spend person in office regardless of party, regardless of race -- i don't care if the president is purple, pink, polka dots, he has to do the job and stand up to the congress, the pork barrel, and get rid of it. host: what would the gop bring to the table, in your view? caller: that's a great question.

i really don't know. host: do you have faith in them? caller: i have faith in no one at this point. we need a parasitic cleansing in both the senate and house at this point. as new yorkers, we are going through the same thing with our local senators. we are in debt to the tune of $9 billion that state secretaries over here earning 180 out of dollars a year - i can't justify that. -- earning $118,000 a year. this man and the white house unfortunately is trying to undermine the whole country. we cannot afford another trillion dollars in debt over this whole health care thing. furthermore, legislation to mess -- a foot to mess with the second amendment. he stood on the capitol steps and swore to defend the constitution of the united states and a half to a great wit the previous caller about the military, 18 and a half minutes of service, i will take of a gun in a minute and defend this

country and unfortunately people like obama, etc., are undermining it. host: peter bakker has an interesting piece and "the new york times" today. when 435 isn't enough. he writes that the supreme court now is being asked this -- to decide whether the house should be enlarged to produce a fairer distribution of political power. "the new york times" there.

clayton, georgia. independent. wayne, how are you? caller: good morning, paul. no faith in the obama administration. all of his policies have been failures. the stimulus package did not create jobs. cash for clunkers, each a deal cost the taxpayers $8,000. all it did was bail out the unions. obama healthcare, based on lies and it is going to cost a lot more money. it is going to have rationing. it is going to every distribution of wealth. a total failure. i thought possibly this man would help race relations, but president obama has actually made race relations worse. listen to what is going on with this country. we were not really given a good background by the media. if we would have known -- his

claim to fame was acorn, he was their lead attorney and helped organize that to what it is. and the people just were not well informed. host: another piece and "the financial times" to tell you about today. page two -- obama berated on business. the picture of tom donahue from u.s. chamber of commerce. they want to spend up to $50

million in the run-up to the midterm election to focus on this issue. also in "usa today," chicago's new gun law goes into effect. one of the lead items and "the new york times" today says -- beyond guns. nra expands political agenda.

and the story goes on and on on how nra is involved in issues far beyond the bonds -- guns. william, republican did your level of faith in congress? caller: my level of faith in congress the -- there has been some much going on where president obama -- i think he is doing the best he can do and also congress, too. you have to have a bipartisan party to get anything done. for the last eight years i does have to say i am fed up for being a republican myself. i am going to vote democrat coming election time.

of all ideal of that he is that i have read up in history that under dick cheney when he was under richard nixon, his presidency the loss of it was the belief the president has the power, even obligation, to act however he sees fit regardless of the constitution and i honestly and truly believe that for the last eight years bush turned a blind eye and in that wall street get by while he was getting himself lined up with the big oil deals and the middle east. host: another twitter message here -- one more piece out of "usa today." these attacks in uganda. i warning to africa, say analysts. the bombing of this road but we -- rugby club in uganda and

eight restaurants -- a message to african nations that they should not try to stop the militant islamist movement in somalia. this from countered terror analysts. that is and "usa today." also this piece today, the leader of sudan facing war crimes charges. this is just one of the many write ups in the paper over this.

last couple of calls. question -- do you have faith in president obama and congress? pasadena, maryland, a democrat, laura. caller: i never know if i should call on the independent what democrat line because i voted for nader, and i took his november 5 pledge to watch the senate like a hawk. host: keep going. caller: it is really scary. i think we have an absolutely dysfunctional senate. as nader said, we need to vote in 2010, get congress back on track. host: vote for what offer home? caller: vote for a better congress. host: what would make a better congress and who would be there? caller: people who were not lying about being democrat. republicans who were a little bit more -- not quite so much libertarian. i am sorry, i can hear you when i turn my tv down. host: go ahead and finish up,

laura. caller: as far as obama, i think congress is blocking him. his promise to close down get mauled, then congress decided no detainees can be released in the u.s. -- his promise to close down gtmo. he is one-third of the government. i would like to point that out. host: time for one last call. edward, republican from large bowl, georgia. how about your level of faith in the president and congress? caller: for one thing, the tarp bill that obama signed was completely unconstitutional. they took all of the mey from the poor and the rich and gave it to the super rich. all of your callers saying they are democrats together one that called in, they are just worried about a little check they will get in their box, that is why there are supporting obama. if they read the constitution they find out that everything obama has done is going down the tubes in the supreme court. host: that was your last call.

we will take a short time out and talk positively about small business and jobs and what is happening in congress and elsewhere in town on all of this. our guest will be daniel indiviglio of the atlanta business council. plus, more of your calls. we will be right back.

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continues. host: with us now is editor and blogger for atlantic business council, daniel indiviglio, talking about small business and jobs. pointing to "the new york times" that says small business lending is down but reason still include experts. what is your sense about small business lending and why it is still down? guest: probably several reasons. the three main ones. first is less demand. businesses are not seeing consumers coming to their stores as much as they did before the recession. as a result they have less need for lending capacity to two -- to do things like investment because they are not as convinced people are coming back. that is one major reason -- reason. the other is business doing badly in a recession and as a result, banks are not as willing to lend to businesses. high standards. the third major reason would be the banks themselves, they are kind of stressed act of the

financial crisis -- things are better but not great. host: this is a bill in the senate, the pending bill, this small business bill. $30 billion. the house passed the already. what is your understanding of what it is -- what is in there and what might do? guest: several bills underway right now. one major push from the white house yesterday was the hire act, which is what they call it. it would give employers and tax credits to hire more people, hiring someone who has been unemployed for 60 days, they get to not pay their social security portion for the rest of the year. they want to extend that for six more months. but also get a thousand dollar tax credit. separately, there are other pushes for small business. one of them would create $30 billion fund the four banks to

get funding to lend to small businesses. so there are a lot of different pushes right now. host: our guests this from cornell -- triple majored in economics, philosophy, physics. now editor and blogger for atlantic business channel. guest: "atlantic monthly" is one of the old as magazines in the country, probably the world. we have a bunch of different channels -- business, on all different topics with and business. the cross between business and politics. financial reform and that sort of thing. host: the phone numbers on the bottom of the screen for our guests. he is daniel indiviglio from the atlanta business channel. we have a line for democrats and republicans and independents and there is a fourth line for small

business owners. we will put it all up on the air here. we will hear a short piece from denver 90 as he held an event. >> the formation and growth of small businesses depends critically on access to credit. unfortunately, those businesses report that credit conditions remain very difficult. making credit accessible to sound small businesses is crucial to our economic recovery and so should be front and center among our current policy challenges. host: what is going -- is going to take to get credit available to those who need it? guest: the federal reserve yesterday, one thing he said he has been doing is he has been working a lot with -- let me start again. but reserve, a lot of people don't realize their regional offices. a lot of people think they are

just washington-based. but actually tried to get down to the community about the businesses and small people. they have been hosting town halls for spa businesses. they have been talking to people to figure out what the problems are. one thing he raised was credit. he said yesterday one of the things small businesses raise, they apply for loans at banks, which banks in theory would accept but then the regulators say you cannot get this loan for x, y, z reasons. they have been working with other regulators to try to figure out why the loans are not happening and to try to maybe make them happen if they should not happen, loans that banks want to give they ought to be begin to people. host: what is your definition of small business? guest: a good question. all sorts -- i did not think there is a standard definition. some people say a business under 50 people. some people say -- number of assets. there is no specific definition. host: put it in the framework for perspective, how important

of -- are what we call small- business to the fabric of the whole economy? guest: very important. especially in a time like now. half of americans work for small businesses. they are generally responsible for job creation. i think 60% or so of new jobs come from small business. at a time now where we need jobs so badly, it is important. host: first phone call for our guest, cleveland, ray, independent. go ahead, ray. caller: there is so much junk in this country and you can't -- i don't know. host: was not able to complete his point, but let us go to mike of the democrats' line from charleston, south carolina. caller: i like the idea of local businesses growing. we need to build our communities

from which in and businesses that have once went into a community and then later they leave to go and expanded to different parts of the country or a corporation comes and, puts up infrastructure right outside the community, and what happens to the old communities that companies leave from? it leaves the old communities in ruins. and people locally have no work. that often times turned to depression, drugs, alcohol. so this continues the downward spiral. so, corporations from the outside want to come in, believe they need to make deals with the communities that said, ok, we will set up a large manufacturing facility on that the outskirts but we will need such and such amount of money to continue to grow and develop as a local community. guest: i know a lot of major corporations these days do work with local governments.

a lot of local governments are excited about these companies coming in to provide jobs. i am sure there are also situations where he is talking about where large corporations -- host: pittsburg, kansas. patty, democrat. caller: good morning. instead of dealing with the government, what these small businesses are trying to do now is to come in and -- they have been doing it for quite a long time now -- , into the commission meeting, the city commission meeting, have a grant foundation or matching funds, and the basic thing they could possibly get money out of, instead of asking for a loan from the government to help out with small businesses.

the taxpayers are getting it. either way, it does not make any difference if you know anything about money. some people think pell grants are free. i said to somebody the other day, a pell grant is not free except for a student to get them to college. guest: what they are doing right now is sort of accommodation. there are loans out there, small business loans are a big part of the stimulus they raise. but some of the things are more grant-like, i guess. the tax credit, that is money they obviously did to keep. they don't have to give it back if there is a tax credit. some are direct stimulus and some are loans. host: and message via twitter -- without demands -- guest: a lot of people say that

you can't really encourage businesses to hire if the economy is not there to support it. one of the issues is, without that demand, the small businesses with all the tax credits and the world will not make them higher if they did not feel the additional workers will have anything to do. so, that is a problem. but then the people on the other side say, yes, these businesses will still have capital and what will they do with that? they may sit on it, within a put it to work. host: before getting into journalism, you spent several years as an investment banker, a consultant for financial- servicesirms. what was that part of your career like? guest: it was interesting. during the housing boom i consulted a lot of mortgage companies out in california, the kind of wacky things that they were doing. a lot of times i would shake my head at these mortgage products that people were buying. everybody believed it would be okay and the market would keep going up, and i guess they were all wrong. it was an interesting time to be

out there. host: our guest has also written for "forbes." he is editor and blogger at atlantic business channel. tennessee, independent. good morning. low, national. -- hello, nashville. caller: thank god for c-span. i am confused. you have this morning to you have faith in the president and congress and then the big banks and businesses -- to big to fail, mess up america. can you put some facts, studying how the big companies and businesses took america to the cleaners. and congress, try to explain the credit card companies, how they were taking money from people

that they could not even do but -- that was fraud. these companies were never put out of business. small business are the backbone of america. host: a tough connection there, but could you take anything out of the call? guest: it seemed that the major concern was the two big to fail problem, how the big banks or of made a mess of things. i think everyone feels that way these days. hopefully financial reform, which is on the verge of passing finally in the senate, may help that. specifically credit cards. obviously there is the new consumer financial protection agency which again will hopefully help matters. host: does the big finance reform bill connect directly to small business in any way? guest: i would put it this way. my understanding is it should not do much to hurt small business. you really have to focus a lot on the financial industry. so, it does not say a lot about small business. there are not specific

provisions that would help them. but there are two in direct helps. the consumer financial protection agency, if it does what it should, some small businesses that rely on personal credit may have a better chance of getting fairer loans for their businesses. secondly, there is something in there that would limit the interchange fees for debt cards, which would help businesses because they would not have to pay as high fees. they could charge people less. host: you mentioned small business accounts for maybe more than half of employment. when you talk about small business, what kind of areas, what kind of business or products these days -- lead the way? guest: anything from a bait shop to a small start of technology firm. all sorts of jobs. the kinds of jobs there obviously the best are pretty good incomes. a lot of start-ups in technology and green technology, still big considered small businesses because they will have less people to start.

all sorts of things. but a lot of those really good jobs would be technology-driven. host: is there a difference when it comes to lending between angeles starting a business and growing it once it started? are there loans available in one area versus another? guest: these days because banks are so concerned about credit quality, i would imagine it is easier to get loans if you are already established. if you already have balance sheets where you can show cash flow, the banks would have less risk than someone who has an idea that has not been established, that sort of thing. host: are there parts of the country doing better than others when it comes to small business? guest: in general parts of the country doing better all around were not as heard by the housing bubble. .

caller: my family and i are on the verge of opening a production company, but it is very difficult to get a loan. everyone in the family must raise money. that is what we did, and we are developing the company. i think that is what everyone should try to do -- try to save your money and get it done. host: caller, how many people

work for your small business? caller: about four. host: so, with a loan, what kind of expansion are you trying to do? caller: into expansion [inaudible] host: what has your process been with the banks? caller: it is my dad who is into it, and we're helping him not. guest: a think the caller is right, a major problem he is experiencing and those across the country are experiencing. some are expansion loans. some is to buy new equipment. some is just for capital. another major problem these days is commercial real estate. many banks are especially aware of that market as delinquencies continue to get hotter.

so, that is another issue. one of the proposals by the white house for commercial real estate in particular is to have those loans be refinanced during 2011, 2012 -- hence, the modifications/extensions being proposed. host: how many can raise their own money to start a business these days? guest: we see fiscal responsibility ramping up on the part of americans, many people paying down their debt because of uncertainty out there. many people do not have that kind of savings, but hopefully, in the future, they will have more of a cushion. host: the perspective comes from the "the wall street journal" -- small gains in the credit. the league writes that the worst

may be over, but this important corner of the financial system does not show signs of recovering quickly. rockford, ill., republican, mike. caller: my question is, what you do when you find at the local government does not seem to respect the importance of small business? i have a home occupation business. i talked to my government about helping me out, access to my business driveway, and things like that, and keep being told, you are a home, not a business -- you do not count. guest: it sounds to me that there must be regulations or laws in place that if you worked out of your home you're not

considered a business, so that sounds like a legislative issue that needs to be changed. so, talk to your representatives. in general, the local and state government should support small businesses. o of thene other issues they're up against these days -- there stressed with their funding belote, laying off teachers and firemen. another proposal out there is to help states with their funding. for the federal government to provide money to states for that. host: what else can you tell us about folks running a small business out of their homes? what rules govern that? guest: it should not be that different. but states have a lot of detail- oriented stuff with regard to business. if you are running a business from your home it should not be different, if you're selling products or services.

host: what else might congress be up to the rest of this legislative session be on this current small-business bill? guest: not a lot. harry reid of the size of difficult it will be to give much more passed. the recess comes in august. they have a nominee to confirm, the financial reform to wrap up, and they still have to deal with unemployment benefits. and, the midterm elections coming up. host: so, based on what you said, what is the impact on the economy, specifically the small business community? or what is not happening in congress? guest: i guess it comes down to how effective you think the legislation of congress would be.

if you are more cynical about government, you may say it is good that government is not meddling as much in business. host: are the states in a position to do anything to help small businesses? guest: most probably are not. most states have economic problems of their own. one of the stimulus measures the federal government wants to see is to give small business stimulus to the states. host: george, a democrat, good morning. caller: i want to be honest. we have heard for a long time that small business is the engine of the economy, creating jobs. i think it is a lie, a stratagem by the chamber of commerce and the big corporate structure that runs our government -- and is

mcdonald's, general electric, hiding behind a mom-and-pop businesses to get untaxed and be regulated. if you look at commercial real- estate and it arises to level that few small businesses can afford. property will choose a big corporate entity over a sole proprietorship every time. if you pull off of the interchange, from the expressway, into communities and you see the big hotel chain, drug store chains, our landscape is just one huge corporate entity after another. they control all the fiscal infrastructure. we have two cvs' on one block. if you look of the fortune 500 companies, look how many they employ. local proprietors are like the dinosaur out there.

we have whole communities pitted against each other to attract outside corporations. if a sold proprietor loses a valuable worker, they are devastated. when a corporation loses a valuable worker, the worker has lost everything. so, big business predatory kept lists are the biggest threat to small businesses. guest: many things were said there. in terms of whether or not small businesses really are driver for jobs, that is actually true, i think. i have been many independent studies showing that. in terms of big businesses being predatory, it is probably true

in the sense that they are competitive. they do want to sweep in and put out of business small firms. that is what they do -- they are businesses. to the extent that some businesses cannot get feet -- sometimes there certain niche products that small businesses can provide better. many times workers prefer small businesses rather than large companies. they do feel that their employer cares more. small businesses have some advantages. but you are correct that it is hard out there for small businesses these days because big businesses have so businessesclout and pull with politics and the washington. host: here is a message by twitter -- any thoughts? guest: that is generally true. most regulations are harder on

small businesses because large businesses tend to have more capital and largest investor sure to deal with regulation. even just knowing what it is, or the cost of employing the regulations. many times we see in the washington certain politicians will try to exempt small businesses. but that is hit and miss. host: i read that the largest businesses have about $1 trillion in cash on hand. is there a connection between that action and small-business? guest: i do not know their necessarily is. if there is any connection, it is an indirect thing. if they did not have the cash, they might be buying more equipment, and maybe that would help small businesses and directly. on the corporate side where people are saving is the same thing on the consumer side. it is just a time when the

recovery is fragile. people are scared to spend more. it is across the board that we see that. host: this caller is from indianapolis, on the independent line. caller: open the home day care of last year. business is booming for me. i'm a great believer in what the bible says about the barr were being a slave to the lender. i don't believe in going into debt. i have been able to grow pretty well without debt. i do it the old-fashioned way, put the profits into my business. i realize this is a low overhead business without much start of cost, but it is working for me. i'm also teaching my kids that. i wish the powers that be, government, would realize you don't need to go into debt all the time. you can grow slowly and surely.

host: do you do your day care business of your home? caller: yes. guest: that is a good point, kind of a double-edged sword. it can be helpful, but once you are under and have these large loans at maybe 7% annual interest rate, it can be very hard to pay that interest and worry about your costs. if you have the savings, that is the easiest way to begin. host: this is dean, republican from idaho. caller: good morning. i have been watching for a while, with some interest. i think that you're missing the biggest factor about business expansion, especially for small business. that being certain to. you want to talk about banks no one to loan, but there is also

the demand part of that -- that factor is certainty. will be the corporate rate, the capital gains rate, the individual tax rate? what will be the regulatory environment? so, uncertainty is really the biggest impact iimpediment to bs growth. guest: as, uncertainty is a huge factor these days, one of the reasons why businesses are not sure what to do -- yes. it is fairly weak, better than a year ago. will it continue? there many questions out there. this is a big deal to make the decision to expand -- if it does not go well, that is the end of your business. you have to be careful, and it is hard. host: the caller brought up two points -- one being the rate for

small ones. what do you see happening? guest: interest rates right now are quite low. mortgage rates have an all-time low last week. in terms of assuming that the risk premiums have not gone up that much -- maybe some of the past year, interest rates are pretty good now. in a couple of years, that could change. many people are worried about sovereign debt problems that could drive interest rates of four banks, affecting all rates. it is hard to tell. right now the rates are quite low. host: how about the regulations cited things? guest: when you have an aggressive, ambitious congress and white house, you have more regulatory change and loss. on the financial reform front right now many community banks and banks are not sure what to

expect, even though regulation is nearly complete, 2600 pages -- a lot of complexity in there, so people don't really understand until the regulators say. there is also the health care reform bill passed where employers have different requirements put on them with coverage for employees. it is still evolving. hopefully, the certainty will improve more next year. host: this piece in the paper this morning, the u.s. chamber of commerce head is being interviewed here -- a obama breakdown business is the headline. the head of the powerful lobby is a fierce critic of white house policy. there is more than a little bit of talk about congress changing over to republican hands, at

least on the house said. look again if you have a split government. what would it mean? guest: it will be interesting to see how that pans out. obviously president obama and republicans will want to get something done, but what will they be able to agree on? i think you will see more tax cuts. so, to the extent the president will be on board, you might see more tax cuts if republicans take the congress. however, you might see some compromises. but it will be more difficult. republicans are very concerned about not spending more on the deficit and debt. host: roy, north carolina.

caller: the [unintelligible] tax is a very high techs. of approximately less than the majority of people make a $109,000 per year. what will the average person do with $15 per week? they will spend it. i was in business 50 years, and now retired. i hired more when business was good. if you put that money into the pockets of individuals in that income range, they will spend it. guest: certainly any tax cut is the motive measure.

and no one argument -- i know one argument has been to get rid of the ceiling, so that those who make more than $109,000 will have to pay more. it does not as a selling make sense that richer people do not have to continue to pay. it would also be a similar measure that would help the economy if there were fewer taxes. host: good morning. caller: business thrives on people spending money. in detroit, as you know, we have a bigger unemployment problem. congress does not seem to want to pass the extension. if they would, people would spend more. businesses would do more business and probably hire people.

do you think it will pass the unemployment extension? guest: well, i don't have a crystal ball, but it is hard to believe they're not passing it. one of the least controversial stimulus measures would be to allow those unemployed who cannot find a job to get checks a little longer. that rate in some states is incredibly high. it is 9.5% nationwide. the long-term unemployment is historically high. it is a major problem. if these people have the money, they would spend. they must spend it. they needed for day-to-day expenses. host: here is a question by twitter. how that is it for a small

business when they have to take a loan just to meet payroll? guest: it is going on somewhere. in theory, a business should not need payroll loans. but these days the economy is where it is. many are saying once the economy turns, i will be fine. that is the kind of loans that banks probably have trouble with. because they're not convinced that there will make it to once the economy turns around. host: this is a republican from pennsylvania. caller: i agree what the gentlemen said about uncertainty and business. i am a chevrolet dealer. there are fluctuations meeting

capital where inventories build up. a line of credit i have used many times with the banks -- if there is any problem with that, it will slow down business. but the uncertainty of whether you will get credit, or what your taxes will be are the primary interest of any business. maybe the government should work on this line of credit with banks for business has good credit so they can establish and ahead of time. you do not wait until you need it. i usually got a line of credit in january or february because they used cars will start piling up around june or july, and try to have it paid off by the end of the year. but your credit varies. it is not a steady thing for most businesses. some times of year you need a lot, sometimes you do not need any. i do not know the answer, but i feel the government should make

the credit ahead of time, and work with businesses. if the banks will not do it, the government ought to. host: that is input to their from a former car dealer. guest: yes, uncertainty is a big problem. we are at a time of economic limbo. it is hard to see where things are going. that uncertainty will probably persist through the rest of the year and through parts of 2011, or for the. some of these government programs would hopefully encourage lending. the $30 billion fund the obama administration has proposed would in every help if it works as intended.

the federal reserve with ben bernanke yesterday -- when he was talking, back during the crisis there was a program which is an alphabet soup term. the federal reserve would buy bonds from banks, and those were comprised of small business loans. as a result, banks had more funding to lend. that ended in march, or june. it is interesting the fed did not bring it back up, because it would be a message to support the small business economy without having to rely on legislative issues. host: 1 more headline on the fed chairman. ben bernanke urges more lending to small businesses. they say it dropped from $710 billion in the last quarter of

to those innate to less than $670 billion in the first quarter of 2010. we have a caller earlier who said his income has been reduced by about 75%. do you have a sense and the small business world, those who work for them, with the average rate of pay might be, and how much it has dropped? guest: i do not. i think it has dropped across the board. many small businesses are gone altogether. host: let's hear from salem, new york. it is thick. -- dick. caller: yes, hello. i have a question for daniel. i am a competitive enterprise-

type of person, an old timer. i agree with the levy on earlier who said maybe we should find ways to do more for ourselves. we make loans in our small business, take loans. in this i have found that these small banks do a wonderful job for us. we hear lots of complaints about the small banks, but that has not been our experience. we have been doing this for 10 years. i'm wondering what you think about the fact that the small banks are probably more careful in how the land, and at the same time they face horrible uncertainty. they don't know what will happen with that fdic. the government in my view seems to be punishing the good, sweet,

small banks. i think there are some wonderful people working there. guest: soak my two questions. the first was the impact on small things, and their status. i think he is right that small banks are responsible for most of the lending to small businesses. as the financial industry has soared ever covered, the big banks have been doing better. but have these big infusions from bailouts, and many have trading sides with stocks and bonds. small banks do not have that as much. they will struggle more with losses. many are heavily invested in

commercial real estate -- that has been having trouble. they are having problems themselves. the second part is the regulatory emphasis on the financial industry. the jury is still out on that because it is so complicated. many precautions were taken to not personal banks of lake, but anytime you impose regulations it is hard. the other problem is -- republicans are especially concerned that some bigger banks will have a competitive advantage since they will be governed as being systemically risky. host: this is one last call,

randall, from virginia on the republican line. caller: good morning. there is a big wealth disparities in the country. it did not just start one year or two years ago. it started about 1973 when the top 10% had 49% of the wealth, and the bottom ha91% had 50%. by 2005 that had changed to where the top 10% had 73% of the wealth, and the bottom 90% had it 27%. in our small committee we used to have our main street. we are probably one of the few committees that have low railroad track running down the center of main street. we have lost all but agreed to

restore and hardware store. it is a local hardware store, not a chain. all other businesses are gone. the main thing i think was because wal-mart about 14 miles away built a big complex. people ran over there even though they could have bought it cheaper here. that to me is what is hurting. people do not have the money. when 90% of the people have less than a third of the wealth, it creates a major problem. host: final thoughts on the future of small businesses? guest: it is a difficult time. this is the united states -- let's be optimistic. i think it will get through. it will be hard, but eventually the time of uncertainty will be over. host: daniel indiviglio is editor and blogger for the

atlantic business channel. we will take a short timeout, then talk more about the gop and this election cycle. our guest will be tom davis, the former congressman of virginia, former head of the nrcc. he runs the republican mainstream partnership now. >> in washington, here are the headlines. after securing the new cap on top of the well in the gulf of mexico, today bp stars tests to see if it will hold. bp expects to know within 48 hours if the new cap can stanch the flow. today president obama announces a new national strategy for fighting hiv and aids. it calls for reducing the rate of new hiv infection by 25% of

the next five years. and for getting treatment to 85% of patients within three months of their diagnosis. live coverage at 2:00 p.m. eastern. and afghan soldier working with international forces killed three british troops and injured four others with the rocket- propelled grenade to do. the soldiers escaped following the early morning attack. the afghan president has apologized for the killings. finally, the constitutionality of the military's do not ask, did not tell policy will be tested today in a suit by a gay republican group. they sued in federal court in san diego saying that they are frustrated with the obama administration still you to repeal the policy.

>> for a snapshot of the 111 congress, the c-span congressional directory. all of your fingertips. order it online at c-span.org /store. the senate judiciary committee meets today to vote on the nomination of elena kagan. watch live coverage on c-span3 and online, and learn more about the nation's highest court in our latest book, "the supreme court." candid conversations providing unique insight about the court. available in hardcover and as an e-book. host: at the table, tom davis. former head of the republican national campaign committee.

will republicans take over the house? guest: they have a great desire to do it, but you have to run more races. they have done a better recruiting job this year than at any time in history. there is a lot of banks out there. the democrats had done a great job of positioning candidates and raising money. very few democrats would just roll over for republicans. 39 seats is a high bar. there is a problem with the republican brand name. as good as the polls are, it is not that people are enamored with republicans, but they're just upset with the status quo. many people do not identify with republicans, so they must put the coalition together. as we move into september,

october, we will have a better sense. the voter thinks it is high enough that it will not matter. democrats are prepared for this, unlike in 1994. so it is an interesting time. but yes, the table is set. you have to run the a lot of races, and not sit on the sidelines. host: lines are open. tom davis will be with us for 45 minutes to talk about the gop and 2010 elections. what would you mention in terms of strategy? is it different depending on where you are? guest: you are not putting is back in charge, after all. he just fired us. give us a seat at the table so that we can balance with the

obama administration is doing. let's have bipartisan government. under the clinton we got a balanced budget act, welfare reform. let's bring balance. that is what republicans need to argue. i think that people like the balance. they do not really trust either party. they see things on the ground. host: there are a lot of issues and players we want to bring out. first there is a pull. six of 10 americans lack faith in the president, but move this on to congress and said those numbers are not great either. they ask the basic question, how much confidence do you have in these various people to make the

right decisions for the country's future? 50% say only some or none when referring to the president. as far as the democrats and the congress, 60% say either some, or no confidence. how do you turn the -72% into a positive and time? guest: you just want a seat at the table. you're not putting us in charge. but we have to put some correction and some check on where the democrats are going. if you look back over the years almost three-fourths of the time we had divided government. the public does not trust either party. the argument is to give us a seat at the table, to balance the situation. then, if you get the majority, what do you do with it? i was there in 1996 and 1998.

we accomplished a lot. it was not easy, but at the end of the day we had a pretty good economy. what is driving this is the unemployment rate and the banks about the economy and where the country is going. but the unemployment rate drives all that. host: will it worked out in the fall? guest: when the economy is like it is, all gets exaggerated. host: with all the democratic argument about the republicans being the party of no, is there anything at this point the gop should vote for in congress that might help them in their pursuit in the fall? guest: may be with regard to a certain bill. in 1978 was the last time we had one party in control of government during a tough economy. that year the republicans play ball on the panama canal and

other issues. the voters administered a bipartisan spanking. 13 senate seats changed hands. republicans picked up a net 18 seats. after watergate voters did not know who to blame. but republicans have positioned themselves to sales bring some balance and that things have gone too far. host: this is michel, on the independent line. -- mitchell. caller: i have been watching the political landscape. i don't really see what the republican party has to offer other than [unintelligible] a monitoring strategy by advertising.

these things have to be paid for, these tax cuts for the wealthy that have been going on. these are hurting our economy also. again have hundreds of billions of tax cuts, but cannot keep benefits going for unemployed? it seems averages. i think they are playing a typical cyclical strategy with the economy. they know that the economy will rise and fall, and when to get the right place of the right time. but frankly, what are they offering us? guest: there is always some of that in politics.

they blame the other guys, go back and forth. the republicans want to turn around a trend where 47% of american households. federal income tax. you can talk about the rich getting away with stuff. but in terms of income taxes, these people are non- participants. we do not have the tax system that unduly burden the poor at this time. suddenly, look at where the money is gone. nearly two-thirds of the federal budget goes for medicare, medicaid -- 82% of those dollars in the virginia go for senior citizens and hospital be social security, interest on the debt -- money invested in of retirees, not in the future. our global competitors are investing in the future. every dollar that we spend on the retired and entitlement

programs is money we cannot invest in infrastructure, research and development, and education. i think with republicans you will see a change of priorities and a willingness to tackle some of these issues. it is not what i would have liked while i was in congress. you cannot stay globally competitive and provide the next generation with the opportunities they want when you are paying down debt. we are general motors in that sense. of the retirees are basically a pretty white group. 2013 will be the first time that you have an on-white group of retirees as the majority. the priorities need to be turned around. we have to start investing in

the future in order to be competitive for the future. we see unwillingness to tackle these issues and make changes. bringing republicans and the picture -- hopefully, we can work together. right now we are in airplane turninflying into a mountain. host: good morning. caller: yes, sir. i have been watching of the" frontline"on the internet. i saw a documentary called "the warning" mentioning brooksley --are you familiar with her? guest: yes.

caller: she apparently warned alan greenspan in 1996 of this crisis, exactly as we are experiencing it. i have noticed there has been a lot of anti-republican rhetoric associated with this economic crisis. that is except that as far as i can tell, it was under the clinton administration that this warning was rocked to the chairman of the federal reserve, alan greenspan. if republicans are responsible, are the going to remove all the baker credit swaps and over-the- counter derivatives loopholes?

guest: on the credit default swaps and derivatives -- i think they have a place in the market. people should have a right to hedge. the problem is there were not transparent. as a result, i think when the crisis hit it was deeper than anyone could have known. they have tried to address this. there is a lot of argument for the they have gone too far or not far enough. the commodities future modernization act allowed this to proliferate. i was not there on the house floor to vote for that when it came up. it came up under the suspension of rules. it is a good thing i did not vote for it because i think it was one of the different

problems. under the clinton administration we college the dot.bombs. this second bubble did not come until the later housing boom. there are many causes for that. the bush administration got blind. people turn to the other se. now the economy has not yet turned around. much of politics is time and place. if you were there during good times, you don't have to be that good to survive. a lot of this has to do with time and place. there are a lot of second guess ers. it is very complicated. i and most people would like to

see people sitting across the table solving things. we don't have that in washington right now. as long as democrats control both houses, there is no real incentive to talk to us. host: tom davis serve the 11th district of virginia from 1995 until 2008. what about your current group? guest: we are group of republicans now believe in governing. we like to work across party lines, if that is what it takes. we focus more on economic issues than on social issues. we are main street. we have over 40 members of the house and senate who are members. host: there are couple of pieces today on the tea party. here is the lead editorial in

"the washington times." and in this paper, the reporter writes about the tea party and passed to power. guest: they add a lot of energy, most of it on the republican side at this point. they are creating some problems within the party because they are challenging longstanding party leadership. their candidates are moving forward and they don't necessarily adhere to a party line. the reflect a genuine concern that things not working well. that we are trying to spend our way out of this. we did not expect boaters to be policy wonks. there is a genuine reaction to rising unemployment and rising debt. how the republican

administration and obama administration react to this -- when you take the energy factor, they are assets. you see politicians of all stripes trying to make peace or coopt with them, as a result. host: go ahead, please. caller: my concern is with this, you guys have got to be running on this year, it seems it is based on divisiveness and apologizing to businesses. what are you running on that is positive for america? guest: the party line right now is that the debt is spiralling out of control. look at the projections. we are the airplane flying into the mountain. we cannot sustain it.

the entitlements and the debt will eat up dollars for education, for research and development. it will two dollars for transport infrastructure. republicans will not control things if they gain the house, but merely have a seat at the table and try to balance things. look at other options besides spending. as republicans, we generally believe people are more capable of spending money on our own behalf then government is. we prefer to have money returned to citizens and spend it ourselves. sometimes that works as better stimulus. we want to extend tax cuts to return people's own money so they can go out to stores and consume.

this debt issue is huge. it has been building for years. when you look at what is happening now with stimulus spending, and retirement of baby boomers, it becomes a real crisis. republicans are saying give us a seat at the table to help resolve these issues. these will be resolved by both sides sitting down. right now in washington it is all blue. host: good morning. caller: i just wanted to tell the guest that i grew up republican, and no longer an republican. i do not expect a will ever vote republican again for a number of reasons, one of itwhich is

that your group refuses to have me as a member. guest: what does that mean? caller: it means that i'm atheist, and then ordered to join the party it means you have to state that you believe in god. guest: it is not true. we have a lot of secular people. caller: i will not sign that. you can say whatever you want, and you probably have not sign such a thing for a long time and just do not know. host: is there an application? guest: not in virginia. everyone is an independent, and when the primary occurred you can go to the democrat or republican primary, it can switch from year to year. you do have party conventions and pledges they ask you to son. but there is no adherence to god in those pledges. host: back to the budget, to the

debt -- are you proposing -- guest: he can vote for us, it keep the national economy going. i will personally invite him into the republican party. host: back to the viewer's question. guest: no, i think it is more nuanced than that. you have different parts of medicare, the from parts of social security. we are currently paying out more than we take in for social security for the first time ever. that depends on how you look at the numbers. people are living longer than they were. they have already raised the age from 65 up to 67. in medicare, benefits have been extended.

we have to look at delivery systems. an across-the-board cut is probably not inappropriate way to do that. host: what he think of the healthcare bill? guest: it was not perfect and even democrats will admit this. it was driven by two factors. the senate vote, getting 60 votes. there are remarks and the like everyone is aware of, but that is how you get 60 votes -- there are earmarks, and the like. it was given by congressional scoring, which is kind of arcane. in virginia we have billions of dollars in additional costs under the healthcare bill. the state of virginia now has to pay it, money and have to take from education and state police -- there is no free lunch.

we will try to make this thing work, but with the election of scott brown, they lost the ability to do that. i'm sure in private they will admit they have to return to fix some things, but at least got the healthcare bill. host: the big thought is that the healthcare bill will affect congressional things in the november. the paper says that the bank bailout is a potent issue for the fall election, talking about the tarp. even though most of that money has been paid back, it is that particular issue that will have members on both sides are. their jargon but democrats getting hit for their votes, republicans getting hit by the tea party for their vote. how do you see that playing out? guest: many americans see the

big banks getting bailouts with their money. they don't see the money getting down to main street. i voted for tarp because i think of we have not, the ramifications would have made this recession much worse, probably a depression. people have to be willing to explain why they did it. it is more complicated than a sound bite allows. the reality is, i voted for it, but it was the best alternative among a number of bad alternatives. the banks were failing quickly. if the banks fail, people lose money, creditors fail and the whole system collapses. we averted that. by the way, we will get the money back. is being paid back with interest. people tend to mix it up with

the stimulus. there are twthey are two differs altogether. host: of caller just north of the district here, a republican. caller: i am a small businessman. you're talking about health care. for example, the healthcare bill, and the political realm, it was to reduce costs. saying that costs are out of control and so our premiums. the people cannot afford it. that was the catalyst that pushed the healthcare bill to the forefront. but that was completely forgotten when this came to fruition. my health insurance premium for my employeres renews august 1. i have a 51% increase in family coverage, and a 37% coverage for

individual coverage, in the state of maryland. i have had six of 17 employees have to drop out because they cannot afford those increases. they are younger group of people would not require as much health care as the older people. that increases our average age which is held the state of maryland besides your rates. it is all by the average age of the group. when you look of the 27% increase last year, and so on, my health care expense this year will go up $27,000 over last year. in a small businessman with 27 or 28 employees. that is what bothers me about the way things are being done now. as a republican, or rather, a conservative, this is the plan to get to the single payer system. if they continue to drive the

individual cost for our groups, we have to have higher deductibles, higher copays, just to keep the premium down. because i will not even be on the same plan that i was on last year. so, i'm trying to go to a higher plan with higher copays and deductibles to provide insurance. but we're getting less coverage for more money. it will draw it employees away from the employer-based insurance. guest: that is an interesting phone call. it it shows sometimes the best laid plans does not always operate the way you think. you can design a health care plan that would been the cost curve. it is possible. you could get experts to design. but when it goes through the legislative sausage-making,

this thoroughbred bill becomes a three-humped camel. you go through the scoring, having to pick up 60 votes and cut deals. the initial policy goal of ending the cost curve gets lost. that happens so many times. this bill will play out over the next few years. as it hits the ground, begins to be implemented, we will hear such stores. there are good and bad stories, but it will not play out evenly. they had to take the senate bill as is, just to get something passed. . .

six months of this year. you will have a choice between the leadership that we have now and the leadership that believes that bp should be apologize to first and foremost and that that type of calamity of rot -- wroght my the financial

meltdown at the end of 2008 is analogous to the size of and in ads. that -- those of -- are the choices the american people will be hearing and making in november. guest: robert kidd stated what every pundit in this town knows, and that is that the house is in play. control of the house will be decided in november and it is very much up in the air at this point. , everybody understands, he is honest enough to admit that and he did speak not on tv shows. he was back on his talking points in terms of why it would not switch. the reality is it will be an interesting in election and you have the house on the bubble and the senate possibly on a bubble, too. these are midterm elections. when you look at recent history, when one party controlled the presidency, the house and the senate, they have slipped -- this is the last two times part is controlled everything and in 2002 and, remember, democrats controlled

the senate. you did not have one party control at this point. that has been the tendency. 1966 another year, one-party control, massive republican gains. to put it into context, this is historical in nature. critical if the republicans were to take over the house, would make the best speaker? guest: at the john maynard, i think it is probably settled in the leadership and -- john bowler, i think it is -- boehner, i think it is probably settled. caller: i remember how republicans took care of infrastructure in the united states, that was mentioned earlier. my question is, why vote back in the ones who wanted to deregulate everything? airlines, banking, business, oil companies, that caused the problems?

my senator corn and for what it is bought and sold by banking. hutcheson is bought and sold by business. and my representative, michael burgess is bought and sold by medical companies. you can learn all of the stuff on open secrets and political facts. and the lobbyist grew three times under the republicans, the lobbyists in washington. that is one of the big problems. until the people decide we need some reform in the election, nothing is going to change. people talking about people not paying income tax. if you don't have an,, how you pay income tax? host: let us hear from your desk. guest: first of all, airline deregulation was signed under jimmy carter, a democrat, banking deregulation was signed by bill clinton, the repeal of glass-steagall. it was republican congress and

the second case and the first case it was democratic congress, deregulation of the airline. this has not been necessarily of a partisan nature in terms of the regulation. one of the criticism that regulators appointed by republicans did not oversee the infrastructure, i think that is probably a better arguments of democrats trying to blame deregulation of republicans, when democrats were the implicit and reckitt lies derecognizing that sometimes there was over regulation. host: let us bring in immigration. "new york post" today. arian nation -- alien-ation nation. what do you think of this arizona law? guest: congress has failed to act on emigration since 1986. at that point there was an

amnesty that came with that bill. had we control the borders, i think it would have been a great bill. but we did not do that. over 10 million people streamed across the border illegally since that time. and congress has done nothing about it. my last term in congress, we did pass an immigration reform bill, a tough bill in the house. the senate had a much more liberal bill but we never could resolve the issues in conference. since that time -- democrats and not address that at all. this arizona law has grown out of a great frustration that the federal government has not done its job. i think obama is right when he says that. you need immigration reform. but you need to sit across the table and talk about what really has to happen. you got to control the borders, you have to stop -- a lot of this is illegal coming across. i have seen the tunnels you contrive -- transcript. these are not jus poor immigrants, but they are driving

contraband and drugs. you have to stop that. then you can deal with the people who are here in a reasonable fashion. but until you can convince the public that you are doing something serious across the border, these other issues are very hard to face. host: as a lawsuit has been filed against the state of arizona. guest: i think it is all politics at this point. if the federal government were doing its job it would be one say we want federal preemption. when the federal government has had its head in the sand at the last 25 years, i don't think it is a good idea. host: georgia -- guest: the best answer is not to file suit. let's get congressional area -- action. host: lincolnton, go ahead. caller: one comment and two questions. i will be assisting. on tarp, i disagree with everything you said. the tarp legislation, secretary paulson did not even do with the

money what the legislation was intended for. guest: i agree with that. caller: the biggest accomplishment, $15 billion went to bonuses for merrill lynch. that was the biggest thing is it enabled the banks to collect bonus is that your. to my two questions. you mentioned on the credit default swaps, basically how could anybody have known. i would submit you should have known because there was a firm called long term capital management that went down in 1988 that exhibited all of these problems. and instead of stopping the problems, you'll bailed them out. that was done by a republican greenspan, and democrat bill clinton. i guess my second question -- why should not you have known from that? my second question is this --

and after a man of that, commodity futures modernization at -- the aftermath of that, commodity futures modernization act took hands of the states of derivatives by containing the exemption that exempted derivatives from state gambling laws. tea party folks, why shouldn't that be grounds to make sure that nobody who voted for that corrupt act ever steps would in congress again? we need to turn them all out. host: mr. davis? guest: i did not vote for commodities futures modernization act but it was an overwhelming vote for it in the house. at least that part of the bill was a mistake. what we have gone through -- on the tarp issue, it was a tough vote. we knew it would not be popular vote. what was the alternative? when the house turned it down the first time, the market fell 700 points in about an hour. it was only when the senate

said it we could fix this that we sent some confidence to the market. i do not know where this economy would have been had we not done that. i have not heard anyone who was critical of that come up with a better idea. these are tough votes. in office you have to make tough decisions. and those of us make that -- if he did not like it, throw us out. there is nothing wrong with losing in politics if you do it for the right reasons. but i think sometimes political leaders are afraid of making tough votes. i did not hear any alternatives. you are right, the language was generally enough that both administrations followed up on with this. utilizing the money in ways that was different from what they said it would be. the language was general and of that allowed them. there was not going to be an auto bailout, we ask specifically. but the legislation did not prohibit -- prohibit it. but that was not the intended use. i agree with his frustration, i

and greet them part. it's called -- like host: names in the news, michael steele, head of the republican point -- committee. i want to give you thoughts of his leadership. thomas dew point of "usa today" michael steele, it is time for you to become a democrat. michael steele? guest: he is going to be the party leader of this election. his report card will come on election night. they will not get any changes from then. i went through a lot of criticism when i was chairman of the republican campaign committee and i kept saying my report card is election night. i chaired that committee in 2000, 2002 cycles. it came out with my shirt on.

i think we need to focus on that at this point. and i think michael still needs to just focus on raising money and helping candidates. he does not need to be a policy wonk. host: you came in in 1995, the class of a new gingrich. cs obama not winning in 2012 against a republican. he is thinking about it. guest: he is, i thought, what ever personal foibles he might have had, coming out of that, he is a leader. i don't think anybody in our party with the kind of idea machine that newt gingrich has, being able to adopt that and translate it to voters. is this election in 2012 comes down to a referendum on obama and a choice, he i think could be a very able spokesman. you see in this country when things go bad, people want mr. fix it.

they don't want necessarily sunday school teacher or father of the year. they want somebody who knows how to solve problems and he did to that role. 2012 is a long way off, though. and people had bill clinton on the ropes in 1994 and he won with a larger margin. a long time over the next two years to see what happens. i just don't know obama will be as vulnerable as people say. time will tell. host: who is the leader of the gop right now? guest: there is no one leader. we are a party right now who is out of power with a lot of people trying out the voters will decide who the leader of the party is through the primary process in 2012. we are a broad camp right now and everybody is welcome to participate and it will be sorted out. host: independent caller from miramar beach, florida. caller: you worked in congress

for 10 years and now you are a lobbyist, lobbying the same people you dealt with. how come all these are coming up now that you are out of office and you really did not get anything done while you were in office and you are proposing the same type of republican rhetoric that anyone else is. and i don't care for democrats, either. guest: i am not a lobbyist. i was in 14 years -- years and i had over 100 bill signed into law. but one person cannot do anything. one thing that led me to leave -- republicans lost majority, and we are term limits said on our committees, so i probably would not have had that position had i stayed. i left undefeated and on indicted, so i am proud of that -- unindicted.

you do what began as one person did you can look at a lot of problems, sometimes from outside you look at it differently than if you are inside and it is in your face. i think i was a substantial contributor to the process. i've had some bad votes and couldn't votes, depending how you look at it. but i did my best and gave it an honest day and that is what i could tell him. host: grand rapids, michigan. hugh of the democratic line. caller: thank you for c-span. the biggest question, seeing a lot of us americans are taking half a cut in pay, why aren't legislators taking half a cut, pay two-thirds of their medical benefits, and when they are done with their term, they should not get anything after their term. we are spending a lot of money into our legislation -- taking vacations, having a great time. the rest of us out here are in dire straits. host: not the first time we have heard that sentiment.

guest: you know, first of all, congress is not taking a pay raise this year. they get an automatic pay raise, as the cost of living increases. it is less than what normal federal employees get. but congress under the law gets an increase every year if the cost of living goes up. it pledged that is the law. they don't have to vote on it. but this year and they voted specifically not to take that. washington is an expensive place to live. it is not like middletown, tennessee, or lincoln, nebraska, for north dakota. it is an expensive town. a lot of these members have to keep a home back in their districts and plate -- pay for a place in here. they did not get an allowance. a lot of state legislators get allowances, per diem, the call that. members of congress don't get that. it is the salary that they get. and frankly, you get what you pay for. a lot of people look at the financial restrictions that you

have and the side after a while -- i made less money my 14th year in congress than i did the year before i came into congress. i did not do it for the money. i did it because i thought i could help change the world or change the direction of the country. i had a number of bills passed, my constituents seemed to like it because they keep -- kept electing me. but you give it your best shot. i've been members of both parties give it their best shot. i think members, when you look at it, probably for the amount of work they do, probably on not paid enough. when you look at the act that was passed probably in 1990 or 1991 when it put -- took away the ability of members to take -- make outside income, that was taken away. they built in these permanent colas that gives congress -- many years they have not taken that and as a result they are making about $40,000 a year less than a tent -- intended when they took their ability to make

outside income. we were restricted -- many of these members are pretty well educated and a good number -- not all -- but a good number take substantial pay cuts to come to washington and represent. but i understand the frustration. and if you are not doing your job or the voters feel unemployment is high, the economy is not going well, you will continue to hear that thought. i understand what he is saying, but i have a different perspective. maybe i have been in the town a while. host: tom davis is president of main street advocacy, former head of nrcc, served in the house 1995 until 2008, virginia, 11th district. we have about 40 minutes left. coming up next, the future of the postal service. we are reading that the price of a stamp may be going up again. ruth goldway is chairman of the postal regulatory commission. in the meantime, a bit more news

from c-span radio. >> at 9:18 a.m. in d.c., the vote on elena kagan's supreme court nomination could be delayed by the senate judiciary committee today. it is scheduled for today. but chairman patrick leahy said he would grant the request by committee republicans for a one- week delay. c-span 3 tb has live coverage of the senate judiciary committee starting at 10:00 a.m. eastern time. at another obama administration deep water drilling moratorium is in place to replace the one that was thrown out by a federal judge. the new measure applies to all floating deep water rigs with blowout preventers, the mechanism that failed in bp's well. the oil and gas industry said this new moratorium is as arbitrary as the first. international energy agency says the world oil demand will rise next year, fueled by economic growth in developing countries. this is in spite of a drop in

demand for oil by wealthy countries. in its monthly report, the paris-based agency says global oil demand for next year should increase by 1.3 million barrels a day. investigators say the two deadly suicide attacks in uganda were not intended to be the only ones. authorities found an unexploded suicide invest in a disco ball and the capital kampala. explosions at rugby club and a restaurant as crowds watched the world cup soccer final killed 76 people. the debate on the future of the diabetes drug avandia begins today. food and drug at the station scientists criticized the study by the drug maker glaxosmithkline that defends the safety of the drug. it has fallen out of favor because of potential ties to heart attacks. those are some of the latest headlines on c-span radio. >> c-span is now available and over 100 million homes, bringing

you washington your way, a public service created by america's cable companies. >> what world leaders, from the white house, to parliaments around the group, from this week in the past 25 years with the c- span video libraries online, all free. it is washington and the world your way. >> "washington journal" continues. host: future of the postal service. on the screen is ruth goldway, chairman of the postal regulatory commission. we are reading the postal service wants a 2 cent increase in the price of stamps to 46 cents. how come? guest: the postal service has been losing money for the last few years. in large part as a result of the recession. and they feel that they need to raise rates above the rate of inflation in order to make up the shortfall. when it comes to the postal

regulatory commission, what i chair, asking us to waive the normal law that allows them only to raise by the rate of inflation and allows than to have an emergency rate increase of 2 cents for individual stamps and approximately 5.6% for all of the rates. host: which would take effect january 2 next year? guest: that is what we are hoping for. host: what is the process? what happens next? decouples the regulatory commission established a docket and we will hear evidence from the postal service, both on whether in fact this is an emergency, whether the situation they are in now meets the standard of the law, which says they can only do this in an emergency. second, whether the rates are fair and equitable within the restrictions the law requires. at the polls service is a monopoly, and in that regard it has an ability to raise rates beyond what a normal company

would when there is competition in the marketplace. our job is to make sure the rates are fair. host: we invite the viewer, you at home, to fall in with questions and comments to ruth goldway, head of the postal regulatory commission. speak in broad terms about the postal service. it is in debt. how else would you describe the condition? guest: the postal service is a $65 billion a year organization. it is the second-largest employer and the united states. 40% of the world's mail is handled by the united states post office. it is an enormous organization and a very efficient organization. but it has been hit hard by recession which was focused on financial issues, the postal service relied on for its mail. all the credit card solicitation, mortgage

refinance, all ownership purchases, were all things the postal service suffered from in a recession. and it has been heard by the transition from print communications to the digital world, which is happening in a whole range of different areas. and because it is a government agency and it provides universal service, it is less flexible in dealing with some of the problems that other agencies. so, i think the postal service is an organization that should be credited and respected, but one should recognize that it has serious problems at the moment. host: is it too big? j., i think there are people who would tell you that the infrastructure within the postal service, the system for handling the volume of mail, is probably too big and needs to be cut. on the other hand, people who tell us the postal service really ought to be planning to be a 24/7 organization and that the infrastructure may not be

suitable for the future and, but not necessarily a question of whether it is too big, but whether it is the right size for the past is in the future. host: several other ideas as far as the future of the postal service. on the stamp idea, 46 cents. is that your decision alone or is congress involved? guest: that is our decision. congress is not involved. host: sarasota, florida, democrat, frank. caller: why don't you raise the rate or tried to get a rate raised of 50 cents per letter? i still use the postal service -- and have some smooth sailing and get ahead of the game question on guest: that is a good question, and i often get back from individuals who mail small amounts of letters each day. i think it might make sense, except for the law does not really make it possible. the point of having a monopoly is that you provide service for everybody all around the country.

and that you provide fair and equitable service. most of the people who use the mail of people mailing to you, and they don't actually use that 45 cents or 46 cents or 50 cents, they use a different rate, and if we were to raise the rate to 50 cents, the rate that those people would pay would either be far more than they could afford or it could be unfair in that it would be so much less than what everyone else pays. so, the job of the regulatory commission is to make sure there is a balance between what the individual pays, what the business days, what people pay and alaska and hawaii and here. it is never an easy task. but i take your point, and i have often thought of it myself as a way the postal service might be able to provide better service. perhaps they could have an increase service for a higher price. that is one of the things i have been encouraging them to think about.

host: new york city. in manhattan. bart on the republican line. are you there? go ahead, sir. caller: i am glad you are on. i worked there 30 years. and the post of as does need an increase. i hope the regulations will put it through and be accepted. i appreciate your information. host: we read that the increase in the stamp price to 46 cents would make about a $3 billion difference in the $7 billion deficit. what other ideas are on the table to balance that budget? guest: well, the biggest dollar ideas that are on the table deals with a substantial long- term financing for the postal service and involves enough fact that the postal service has been required in the last few years

to pay $5.5 billion a year into a fund to prepay the health care benefits for its retirees. it is kind of complicated, but there is no other government agency who has to prepay that and hardly -- there is a lot of discussion about reducing or eliminating that requirement. that would resolve a great deal of the problem of postal service has. host: why was it said that way? guest: when the law was amended in 2006, because at that time the postal service had a surplus, and the congress felt that if they put this pressure on the postal service, it would force them to continue to cut and be efficient, and they would have to direct the money to this

funds rather than simply save it and missed spend it -- mis-spe nd it some other way. unfortunately when the law was passed no one contemplated two years of deflationary where postal service could not raise rates, according to the law that says you can only raise during inflation. or that the economy would have the type of contraction in 2008. this was a burden that was far more inflexible and heavy then i think the congress realized when it enacted the law in 2006. host: what is the connection to make that change between the postal service and the hill? guest: our office did a study showing you could refinance and readjust the payment to meet the obligation and still reduce the postal service's payments by $2 billion to $3 billion a year. other people had said eliminate the whole thing.

it takes both the postal service, commission report, and an act of congress to change this payment because it is specifically set in the law. there is some discussion congress may consider that this legislative season. host: moving on to grove, independent caller from new york. you are on the with ruth goldway, chairman of the polls the regulatory i have three products i would like to touch base with. first of all, you really cannot at this point and time consider the post office a monopoly when you have fedex and ups, and i would say 90% of my correspondents on the internet, so they have a lot of competition. it's very difficult for them. number two -- unneeded offices. i live at the border of new york and new jersey, and within a 12 mile strip going north, there are seveseven post offices, many of which serve towns with --

this is right in the new york area -- with less than 1000 people. they could be consolidated into two, at the most, three. in my town of less than 1000, i do not even get home delivery. i have to go to the post office every day. no. 3, i think five-day-a week postal service would be fine. why does it have to be the saturday that you cut out? >> those are very good questions, and i appreciate that. it is certainly true that there are options for communications other than the mail now, and that electronic communication has really changed the way all of us talk to one another and communicate. what the role of the post will be in the future is something that i think is still developing. in the 1970 cost the postal service wanted to go to five-day delivery because they were

wasinced the fax eliminating the need for postage and letter mail, and in fact volume expanded dramatically in the 1980's and 1990's. i'm not altogether sure that because there is this other competition that the postal service is not needed, but it may well be that it needs to be more flexible and have an ability to offer more products and to price them differently than they have in the past under the kind of monopoly organization that they have operated under in the last 35 years. it is a good point and i think it is something that will be considered, probably not this year but in the next couple of years with the postal service and the congress. your second question about post offices is a difficult one. you live in a rural area where you go to the post office to pick up your mail. if you eliminate the post

office, we would have to have a rural carriers go to deliver the mail. would that be less expensive? we would have to balance those costs. under the law, every citizen of the united states has the right to have mail provided for them. just like any other utility you might have, and i would not want to eliminate it from you. i would not want you to have to go to a post office that is 50 or 60 miles away from neyou. it is a difficult balance the post service has to provide. post offices, while they may cost some money and the postal service loses money on a certain number, when you add that up, it does not add up to the big dollar that some of these other things we're talking about do. five-day delivery is an issue that is before the postal regulatory commission. we begin hearings on that on

wednesday. we have had a long series of review and testimony and traveled around the country to hear from citizens. five days is something that is certainly that could save the postal service maybe $2 billion a year. there is a question whether to deliver saturday or -- eliminating delivery on saturday or other days of the week. congress may have something significant in the law that requires six days, so it is our recommendation and congressional action needed to get the postal service to change from 6 to 5 days. host: they say saturday is a big day to put out advertising fliers and that type of thing. guest: or further, to write checks and put them in the mail. some say tuesday or wednesday, a lighter day of the week. others say, we need seven days a

week. it is a much more interesting controversial topic that we thought of when this issue was first presented to us by the postal service. host: there is also a recent story about the affordable mail alliance talking about the increase in the stamp price. they say they do not want this rate hike. "this proposed rate increase amounts to another tax imposed on us impose on americans and a time the economy cannot afford it." what you think? guest: the average citizen spends $6 to $8 and month on postage. they do not know how much money is involved in businesses to communicate to them. businesses are very tentative of any price increase being implemented, especially during a recession, especially when the law normally says postal service cannot raise rates except for

the rate of inflation. so they will organize and make a very strong case to us that we consider the postal service's raising rates. our job is to listen to people -- listen to people around the country and the postal service. it will not be an easy decision from us. host: democrat,am, your on with ruth goldway. caller: you just mentioned the advertising on saturday, which raises another question i had. can that be done on another day? my biggest question -- i have lived in new york city and lived in the suburbs, and there might be a postal carrier who spends half of the day stuffing the boxes of two high-rise

buildings, and another one walking around in the street, whether it is the snow or the sun. another one might be doing it and arizona, another one in new york city. are there cost of living adjustments at all in the business? it is a business, obviously. trying to run a business efficiently. i am a big fan of the post office, but i also think five days a week is enough. host: you have a lot there, caller. let's an answer from our guest. guest: letter carriers are kind of an iconic figure in the american culture, some windows -- don't someone going to your door -- someone going to your door fiber six days a week. stories about letter carriers discovering that a senior citizen has fainted and needs to go to the hospital, helping to deliver a baby, getting a cat

down from a tree. people know them. i used to live in manhattan. my sister still does, and there is a letter carrier who delivers to their big apartment complex and knows everybody there and it's kind of a fixture in the community. so i think we all value these people. in fact, there has been a real cut back and letter carriers in the last few years. the postal service has what we call consolidated roots, so there are fewer carriers, and they are going longer distances to deliver mail in more places. i would say that in the postal world, letter carriers are considered pretty flexible and adaptable, and they will do what is necessary to keep the mail going and to work with the postal service to do it efficiently. host: how many letter carriers are there these days? guest: around 600,000 employees, and somewhere around

25%, maybe more, are better carriers. host: how many post offices are there around the country? guest: 33,000, 34,000 post offices, some contact offices in some of the other places, smaller places. about 12,000 in bigger cities. host: do you have a sense of the average salary for a postal employee? guest: the average salary is somewhere in the $40,000 range. postal employees, as most federal employees, get relatively good benefits in addition to the salary, but it is considered a good middle- class wage. if so let's hear from baltimore, peter. -- host: let's here from baltimore, and peter.

guest: the post office closes for lunch from 12:00 to 1:00, shutting down completely. but yet each of the postal stations have two or three employees. why don't they stagger the lunch periods, one go at 12:00, one go at 12:30, one go at 1:00. guest: an idea from peter in baltimore? host: and i differ. baltimore. guest: i think it is a great idea, peter. we have been concerned that they have been cutting back on hours in the post offices and that people who want to use the mail have a harder time using it because they are closed for lunch, which is when people may be free to use the post offices, not early -- not open early enough in the morning or late in the evening. with the regulator of the postal

service, we do with overall policy issues and finance. we are not the operator of the postal service, but we do take complaints like yours or inquiries and pass them on to the post service and encourage them to be more responsive. i will certainly take that thought. >> who makes decisions like that at the local level? do they come from washington or is it the postmaster? is a very complicated. i think there has been a lot of pressure from headquarters down to the local area for cuts to save money wherever they can. the postal service has done a good job of can back where it can, but some area managers will choose to save money by reducing the hours of post offices, and they may have made a good decision because a scenario where a business is low, or they may not have been as sensitive to the community and a poor decision, just to show that

their balance sheet is lower. we can analyze individual ones, but if we see trends, we can give the postal service some direction. host: we hear from catonsville, maryland. david, good morning. caller: thanks for c-span and this wonderful opportunity. you actually touched on my question, but mine has to do with customer service. what do you guys do -- sometimes it is difficult when you work in government, were in the private sector they can say, ok, we will let you go, and it is a much more difficult process. host: again, we will point out that you're not the post office. you're a postal service regulator.

guest: to help the line to direct people if they need a passport or -- the standards of the postal service is that you are not supposed to wait in line for more than five minutes, but we think that that is a standard that is broken more than it should be, and we encourage the service to do a better job of providing service. it is not easy. the postal service has to deal with every customer that comes in. we cannot turn people away because they are difficult or grumpy the may you might in a private company. sometimes those people take - order. again, we have a lead -- a website that we interviewed to use. if you have a complaint or concerns either about service for about the big issues that we have been talking about --

finding the postal service, cutting from six to five days, the future of the mail -- please get in touch with us. we have a contact us button, and we will do what we can to respond directly or passed your concerns on to the postal service. host: the postal regulatory commission is an independent agency. regulatory oversight of the postal service, and has been in that capacity since 1970 in the postal reorganization act. our guest, ruth goldway, is the chair. she is the longest serving confirmed presidential employees. how long have you been doing this? guest: since 1998. host: how do the terms of office work? guest: each employee is appointed for a term of six years. i was first appointed by president clinton, reappointed by president bush twice, designated chairman by president

obama. so i think i have learned how to get along with people in the administration on all sides. the postal service is not that partisan an issue. it is really more about direct service to people, and i think it is a fundamental government service and i am hoping that my service on the commission helps to make sure the postal service continues at a high level for many more years to come. host: here is a question by a twitter that speaks more to revenues. "why don't you just match fedex and ups prices and work backwards to make expenses match revenues?" guest: that is a good question. in the law that was changed in 2006, the postal service is now allowed to compete with fedex and ups on priority mail, and express packages, and package services. we do not set their prices. they set their own prices. the only thing we do is make

sure there is a floor, that the prices are not so low that they do not cover the costs, because we do not want people who send letters to subsidize the people who are sending packages. so the postal service could raise its rates to more than what they are now, if they thought the market could handle it. i think what the postal service has been doing is raising rates of packages more than they have letters in the last few years, and they have had some growth in the package area. but they are still learning what the market is and what the prices should reflect. they were telling us that there will be a price increase of about 5% in january for packages overall. if you think you are getting a good deal, let us know and we will pass that on to the postal service and they may consider raising prices for postal packages even more than that. host: describe the leadership of the postal service itself. guest: it is not complicated.

think of the postal regulatory commission like the federal trade commission or the securities exchange commission, except our only job is to regulate the postal service. the postal service is a wholly owned agency of the united states government, but it is independent. is budgeted from the rest of government. -- it is budgeted separately from the rest of government. the postal service has a board of governors kind of like the board of directors of a private corporation. they are appointed by the president, confirmed by the senate for terms, and there are nine of them that serve along with the managers of the postal service as an executive committee. the board of governors gets to choose to the postmaster general is. so it is a mixed agency, not entirely government administrate it, not a private company

because it is owned by the government and is supposed to make some profit but not beyond what is necessary, given its monopoly role. and managed in directly by the government. host: thank you for waiting. you're on the republican line with ruth goldway. caller: first of all, i would like to compliment the postal service. i have mailed 7000 packages in the last five or six years, never one lost. guest: great. caller: i'm a big consumer of electronic mail, obviously, but i can tell you where you are losing money. people are not using the correct weight on packages. they are low balling the weight. especially on repeat customers, if the post office would just way a couple of the packages and send them back, people would put the right postage on because

they do not want their mailing interrupted. host: describe how that might work, blowball in the weight. guest: -- low balling the weight. guest: if you put the weight at 13 ounces, it costs less than first class. but actually the item ways 1 pound, 2 ounces. what happens is you are doing it online. they are taking our word for what a package weighs. i accidentally mailed, in seven years, a four-ounce package and put a two-pound label on its, and likewise put a four-ounce level on a two-pound package. host: so these are those that do it in their business or in their home and are weighing it down.

guest: the postal service in response to its need to capture all the revenue it can has greatly improved the point of acceptance for mail-in packages from the largest bulk shippers, so they have more of their own electronic systems and some double checks that is working. that is also part of their complaints that they need to make sure the resident -- the revenue is coming in. they also have the quick-and- ship program where you print out your own labels at home, and i am not aware of how they handle those. i am sure that the postal service will check that issue. this is a concern that they are really looking into now, to make sure that they capture all the revenue that they deserve in the system. host: oklahoma city, democratic

collar. you're on with ruth goldway. guest: i applaud you and the postal service, and i get irritated when i hear -- caller: i applaud you and the postal service, and i get irritated when i hear you compared to fed ex and ups. ups does not come to my house every day and pick up packages. i applaud you very much. i pay all my bills, and there are times when i need the postal service and there are people who do not have computers and things they definitely need the mail service. i applaud you very much. guest: well, it is nice to hear that. as i said, i have worked in the post the world for 12 years, and i think it is a very important part of our country. the postal service is the one service that is enshrined in the constitution.

it was designed by the founding fathers to bind the nation together, and i think that is really what it does. it provides a simple, low-cost, low-tech way for people to talk to one another and to be part of our great nation, and i hope that we can continue to do that. it should not necessarily be compared to the private sector. it has a public role that has to be preserved at the same time that we try to make it more efficient. host: as for the postal regulatory commission, how many members on the commission? guest: we have five commissioners that serve on a staggered basis, so there are always some people coming and going. we have a tradition of collegiality, and we try to make decisions that, if not unanimous, are close to unanimous, and we do what we think is best for the overall postal community. its coat and you meet continuously? guest: we are full-time agency

that meets continuously and regularly, as i mentioned before, on a whole range of issues. we are also involved in international issues because part of the post is to communicate international and send letters back and forth. we participate with the state apartment on international issues as well. host: where else is the postal service looking for growth? we talk about competition with packages but overall production in businesses. where else is targeting growth in the future? guest: i think there is definitely growth to be had in the package business, as one of the callers indicated. the more people on line, the more people shopping on-line, the more they are doing one-on- one sharing of products, and the post office is key to that facility. another area at the post office can grow is developing services for small businesses, a

combination of package delivery, bill-paying commack and advertising, all in sort of a set package for small businesses. more and more people are working out of their homes. the postal service, the fact that it does go to everybody pause home every day, is a competitive advantage in developing services for small businesses. they still think there is growth to be had in general advertising mail. i know we are getting lots of ads on our computers now, but it turns out in terms of studies that there is nothing to beat a piece of paper, something in your hand, to motivate you about purchasing something. and i believe there is a variety of other products that they ought to be looking at -- hybrid products looking at a combination of using the mail and the internet, perhaps some other government services that they could provide that would

provide post offices some revenue. the postal regulatory commission has never turned down an experimental product. i think we will continue to encourage them to consider experimenting and to try then to see what might work and what is clearly a rapidly changing field of communications. host: one viewer wants to know the yearly salary members -- the yearly salary of commissioners. can you help? guest: our salary is set by the government. i think it is about $150,000 a year, and we get the cost of living raise or no raise at all and have the same restrictions that congressman davis mentioned, that we are not allowed to have other outside income and restrictions on any investments that we have.

so we think we work hard, but i think we are also honored and lucky to be part of the government and to do the job that we do. host: alabama, on the line with cannken, a republican. sicko i would like to praise the post office. ice -- caller: i would like to praise the post office. i was a clerk and i retired as a postmaster last year. the public understand that when gasoline goes up 1 cent per gallon, it costs the postal service $1 million. we have about 300,000 vehicles on the road every day, and a great savings would come consolidating some rural offices. i totally support five-day delivery. host: he touched on gas prices and the impact. guest: i have supported

converting to electric vehicles, which would sit on normal amount of money on maintenance. there is some slight movement in that direction with experimental vehicles. that is another area where i think the postal service ultimately can save a great deal of money in terms of conserving fuel in its operations and transferring from the largest fleet -- we have 140,000 vehicles delivering to people's home's five or six days a week. we can really save a great deal of money if we switch those to electric vehicles. host: i think you mentioned earlier that the postal service is a big property owner. aside from consolidation, like one viewer talked about, is there access property buildings that they are using to maybe sell? guest: yes. in fact, i come from california, and i was home over the weekend, and there is a piece of property

that is for sale for the postal service that my neighbors want me to somehow help get developed in a certain way. the postal service is putting up for sale property that they feel is accessible in order to capture savings both in terms of operating cost and just cash. in some areas, in southern california, even though property values have gone down, they have probably made a lot of money on this piece of property they are going to sell. host: let's hear from egg harbor township with john. seek out good morning, miss goldway. -- caller: good morning, miss goldway. letter-writing is an art form. i have letters that my grandparents have exchange, my parents, my wife and i over the years. i can remember being taught better riding high school 50 years ago. -- letter writing in high-school

50 years ago. if schools, colleges, and universities would be taught the importance of letter-riding, maybe it would -- it is sneered at as snail mail, but email goes down the whole very quickly. even c-span could perhaps come up with a sort of a contest for better writing as well as public television stations host: not a bad idea. guest: i am all for it. i do not know if you recall when president obama made his first speech to congress, he pointed to a little girl in the balcony who had written to the president, and that she had not had enough money for postage and somebody in the community provided it. there were stories about how he reads letters from citizens in addition to the e-mail -- he addition to the e-mail -- he dutifully read at least