happen and we know that the rules are not being abided by, we have a right to stand up for our workers and our businesses. i will say you that this is not a unilateral action on our part. this is a reaction to what another country is doing to us. china is restraining its currency unilaterally. i wish they were not. i wish they were allowing their currencies to more liberally fluctuate with its true accommodating value. but if they can act unilaterally to hold down their currency, to make their goods seem more expensive for us to purchase, then we have the right to act in our best interests, whether it is unilateral or not, to respond. that way we can give our workers and businesses a fair chance to compete.

i did not know if i can ask you a question, mr. secretary, it because you have done remarkably good job of trying to explain how important this relationship with china is. i believe you're trying to speak not just to us and the american people but to the chinese as well. i hope that some of us are able to speak to you and to communicate to the chinese people and government to say that this is not about trying to get on the case of the chinese. we have seen this picture before. we did it over a century ago. people are wondering where we came from when we became number one. i think america deserves to be where it is because we work so very hard. we should fight for the workers who are just trying to compete. we ask you to give consideration to what we're trying to do to give you the tools that you say you want to use so that you can compete when you sent down -- as it down and negotiate that very hard bargain with our chinese

counterparts. we want to make it healthier and more balanced relationship. mr. chairman, i thank you for yielding the time did mr. blumenauer will be recognized -- for yielding your time. >> mr. blumenauer will be recognized. >> [inaudible] to provide the tools to engage the chinese. [inaudible] >> i do not think his mic is working. mr. blumenauer, just hold on.

i want to be sure your microphone is on. >> somebody pushed it off. we'll try again. i do not need another five minutes. the concept here was that we would have the resources to make sure that they did in fact play fair. i appreciate what my friend mr. but sarah -- mr. becerra just said. the chinese are historically a great and entrepreneurial country. they have great drive and making progress. in many areas, we have benefited. you kindly pointed out that the $700 billion for tax cuts to the rich would probably have been borrowed from the chinese. that is relevant to this hearing. by the same token, i think it is

a little frustrating that we have not yet used the tools as aggressively -- the thousands of pages that were filed in the whichworkers' complaint, you say you are carefully considering. the president of the association made a compelling argument, joined by businessmen. i kept track, every day for 21 days of the story on the front page of "the times" or the business page where the chinese were cutting corners, taking advantage, going through various, some highly questionable, things. it seems there has to be a limit to our playing by one set of rules when our friends in china are adopting a whole toolkit,

including some that you cannot buy off the shelf and some that are not legal. i, for one, after long thought have decided to sign on the legislation from my friends, mr. ryan and mr. murphy, the currency reform for fair trade. 20% to 40% gap continues to protest at a disadvantage. i appreciate -- to put us at a disadvantage. i appreciate that you have to be circumspect and not underpromise or overpromise, but it seems to me this committee and members of congress will need some sense that we're actually going to be pushing back in these areas, that actually a variety of things that would be unconscionable for us to do it are going to be met with for resolve, using all the tools

available to us. i have not used quite all my time. i'm looking for something that goes beyond carefully crafted statements. it does not get to the point. those of us who have been supportive of want and need something to indicate that this makes sense. >> congressman, i understand that perspective completely and i very much share the frustration of this committee. i expressed this very directly with the basic balance of benefits in this relationship. the only way the system works is if people play by the same set cf rules and there is a basi balance. when we lose that, it is very damaging. one thing we have achieved in the last couple of years -- it is not just frustration with the currency held constant against the dollar before and after the

crisis. it is that businesses across the country that have a long experience operating in china are now finding that internment much more adverse, much harder -- finding that environment much more adverse, much harder than it was even five or 10 years ago. i think we have a need to protect this relationship. we're happy to work with you on ways to do that. the way our system works, of course -- i want to refer to that specific case you mentioned, the steelworkers' case. we have an obligation to decide whether that has merit to proceed to the next stage. we will meet that obligation. there are a set of clear benchmarks where we have to choose to act. when i say we're taking a careful look at it, i mean it will be careful and quick. you will see a lot of that body of evidence contained in the case echoing the concerns you have expressed in this hearing

and for businesses around the country about what it is like to actually operate in that market. we welcome your attention. there is a broad concern about this in congress across the aisle, not just from us. we have a lot of work to do to try to make this better. >> thank you, mr. chairman. >> thank you >> the u.s.-china relationship is complex. -- thank you. >> the u.s.-china relationship is complex. one thing that weighs heavily on me is the imprisonment of one of my constituents, and american businessmen conducting business in china at the time of his arrest. i will continue to ask for his release until the is united -- until he is reunited with his wife and children once again. i appreciate your efforts, the state department, and the present himself as you all

continue to present at issue of the highest level. thank you. i would also address the non- tariff barriers, government procurement, and on and on, to address and encourage increasing chinese consumption. we should try to take a multinational approach on currency. it is the right approach. there are concerns about this bill -- the ryan-murphy bill. we believe it is on shaky ground. i do not like outsourcing the determination to the imf rather than retaining the sovereignty on that decision. i worry that it disrupts the effort to remove non-tariff barriers and address these other issues. i know there have been concerns in the white house as well. news reports and other senate hearings -- as the white house

endorsed the ryan-murphy bill as it is written today? >> no. we have not. we're looking at it carefully to assess the basic question about whether we think it will be effective in advancing our interests. we're looking at that carefully, but that is an effort where my colleague ron kirk and his lawyers will be in the lead. i'm sure you'll be able to hear from them. >> i appreciate the work that ambassador kirk is doing. i want to continue in that vein. you declined to go on record in support of the bill as written. is that correct? >> that is correct. but do not read too much into that. again, we are -- a lot of careful work has gone into that provision and alternatives. we will look at all of them. again, we want to get this in a better place.

>> what are your concerns? what are the administration's concerns about that bill? >> would just repeat what i said at the beginning -- >> i would just repeat what i said at the beginning. for this stuff to work, it has to be consistent within our international obligations. we have to be confident that if we take actions under it, it will withstand any challenges under the wto and give us a good ratio of benefits to risks. we will look any idea through that basic prizm -- any piece of new legislation, any change to existing legislation, any new proposals outside of the u.s. >> is the legal challenge at the wto level only concern you have? >> i'm not commenting specifically. in general, making sure something is specific to our

obligations is important. meeting that test alone does not necessarily mean it will work in deployed. it is a difficult population. i'm not sure people can agree. riprap are you concerned brought the outdoorsman's of the misalignment decision -- >> are you concerned about the outsourcing of the misalignment decision? >> let me give you some of the merits and concerns. the merits are that you take an independent assessment so that we're not judge and jury. problems with it are that this is important to us. i generally do not like to delegate these kinds of responsibilities to anybody else. it is our interests at stake. i would rather be in the position of making that judgment. there are other complications. as the chairman implied at the beginning, there is no science to the termination -- the

determination of overvaluation, undervaluation, and exchange rates. we can always say with confidence that the currency is undervalued, probably significantly. it is hard to know the precise or broad range. those in china who believe the currency should be stronger cannot be sure how far they think it would make sense to let it go. this is a difficult and complicated question when you think about the level of misalignment. >> you would prefer to retain that decision making -- >> it depends on the structure. you can argue and think about lots of ways to do this. in making these judgments, we would certainly look to a set of other independent assessments. we want to make sure that any judgment we make as the

strongest possible foundation. we wanted to be viewed by other countries as having a solid foundation in fact. >> thank you. >> he wants to submit questions for the record. he has to leave. you just want to submit questions for the record. >> thank you, mr. chairman. mr. secretary, i have a number of questions for the record. i will submit my questions for a written response, if you do not mind. >> thank you. >> secretary geithner error in and in -- secretary geithner, you said that china has done very little "to let its currency appreciate to anything approaching marked value." in my estimation, the united states has also done very little on our end to ensure that

u.s. manufacturers and workers are not taking in vintage of -- not taken advantage of. i'm glad you collected the record -- corrected the record about taxes. that is not what we're really talking about today. i am glad you cleared that record. anything that the administration has suggested and recommended, anything discussed in the congress right now is going to be paid for, but we will not pass it. fact does matter. using quick to dismiss -- you've seen a quick to dismiss the possibility of using your turn

-- you seem quick to dismiss the possibility of using your term rid of the vat. the vat disadvantage to u.s. exporters is at $55 billion in 20008. -- 2008. my job, in terms of what we're talking about today and in the larger problem, is to protect the businesses in my district, make sure they are competing him in a true open market -- competing in a true open market. i have heard today that we do not want to overextend ourselves in showing the chinese government how tough we are on this issue.

they are 1/4 of the problem. we are 1/-- we are the major part of the problem. at yesterday's hearing, some witnesses noted that past multilateral exchange-rate negotiations -- we have had those -- bobbwhen president nixn was the president in 1971, he insisted on an import surcharge. the results of that are very interesting. he did something about it. you may not agree with what he did, but he acted rather than simply define the debate by negotiation emptiness. and then one other time that i can think of, in the smithsonian agreement of 1971.

this is not unusual. this is not a retaliation on the part of the united states at unfair practices in other countries. it is just an attempt to make sure that our folks talk about the anxiety that is out there, about the economy. they have a tremendous amount of anxiety. the blue-collar workers particularly in my district who are getting less and less and less. they want to see some message from us -- concrete, rather than just negotiations. they want to see that things are happening. wouldn't you agree? >> absolutely. i do not think telling people that we're talking about a problem raises confidence in their minds that we will solve it. i completely agree. congressman, you're not asking me what i would support today. >> i did not ask you that. you could tell us what you thought of them, since you

bring it up again. >> i would not support those actions. i think it would be deeply damaging to the other things we're trying to do, which is to make the economy stronger, making sure the incomes of middle-class americans are growing rapidly, but we're expanding export opportunities, and seeing more investment in united states. anything that meets those tests i will strongly favor. adding to this important to recognize that to deal with these basic problems of the deep economic -- i think it is important to recognize that to deal with these basic problems of the deep economic crisis -- a clear want to make a difference, we have to do things to help the middle -- if we are going to make a difference, we have to do things to help the middle-class now. we have to be more aggressive and more effective at protecting americans from unfair trade practices. since we're here before the ways and means committee, if we can find ways to resume, improve,

engage in new trade agreements with some of the largest trading partners in the world, that would help, too. we're then expanding opportunities for american exporters and we will see more jobs at home in parts of the country where we're still making things that people need. >> i'm not talking about protectionism. i want to make sure we protect our domestic workers. we have not done a very good job of that by either party for the past 35 years. we have not. and so i am suggesting something concrete. >> thank you. >> thank you. i want to point out of which live in a different time than the nixon administration. -- point out that we live in a different time than the nixon administration. those negotiations applied across the board to all countries. there is a difference.

mr. secretary, thank you for coming before us today. it is important to recognize that we need to look at this from two perspectives -- adequate tools and leverage. i have very deep concerns about the ryan-murphy bill. i think it is the wrong tool and invites a lot of retaliation. we're dealing with a very complex relationship, not just the currency. one of the tools that we not had a discussion on is a bilateral investment treaty. many of our competitors are using these pits the european union is embarking on this type of negotiation with china -- are using these. the european union is embarking on this type of negotiation with china. can we get an update? >> this country was the pioneer of those agreements. they are very good way of protecting the interests of current investors and future investors in the chinese market. we're committed and they're

putting a fair amount of resources into trying to get -- we are committed to putting a fair amount of resources into trying to get those negotiations to move more rapidly. i am very much in favor of moving forward. i think these agreements have a very good record of protecting the interests of u.s. companies and workers. it would be good to put one in place with china. >> with regard to leverage, we heard from the ambassador yesterday. he mentioned using the g-20 forum. with the upcoming meeting in seoul, is there any consideration to putting some sort of timeline on the negotiations to deal with the currency misalignment and some of these other issues? secondly, what are we doing to engage other countries in a bilateral fashion to gain leverage through a coalition in working with china? can you high like that?

>> very good question. ins process of adjustment their exchange rate is going to have to happen over time. it is not going to happen in one week or three months. we're not going to really know in one week or three months or six months or 12 months or 18 months what we will see. this is something to pursue over a sustained time period. the conference -- the semiannual exchange-rate reports, the meeting of the g-20's that happened at the ministerial level a couple of times a year -- these provide a benchmark timetables, things that we can help used to advance progress. -- help use to address progress. we're using every approach we can find. we're using the imf.

in the g tannish 20 -- we're using the g-20. it is not just us. even if it was only us, we would still want them to change their practice. i think that has significant potential. i do not think it will change it on its own. china needs to decide is in their interest to protect intellectual property so that there innovators and prevent it -- and inventors have the kinds of protections we provided the united states. they do not want to be left with their monetary policy compromise. we have to make sure they understand that their ability to participate and benefit from this open, multilateral system of trade agreements and obligations -- and our market

depends on them changing their behavior. >> i met today with the vice minister of commerce and we pressed the same issues. it is in their interest to work with some of these multilateral institutions. it is in their interest to be cooperative in this endeavor. otherwise, their admonition to us was not to politicize the economic and commercial relationship. it has been politicized, not just on our side. >> can i just say on this issue, mr. chairman, when we, the united states, act to protect your advance our interests -- our in -- act to protect or advance our interests, there is nothing political about that. they always say that we're being political. these are things that we have

the right and obligation to raise and we will do so over time as long as we can. i also want to underscore something you said. it is very important that the major chinese companies that depend so much on expanded export opportunities in the world understand that this is a real problem. it is to their interest. the ministry in china, like the ministry of commerce: needs to understand the china's economic interests are directly at stake. >> thank you. >> thank you. mr. dingell, mr. van hollen, then mr. davis. >> thank you. you have been doing a fantastic job in terms of our economic recovery. it is indeed unfortunate that has not had as much of an impact on the unemployment.

it is not felt by most americans as they go through the frustrations of trying to better our economy and quality of life. this issue is a long issue. have always had the impression that you do not discourage us from expressing our concerns and frustrations that we have with the conduct of the people's government to china in -- of china. you have always taken the position that you want us to move on -- you do not want us to move in a way down to prevent you from finding diplomatic solutions and encouraging the chinese government to recognize this was a congressional prerogatives that was not used, mainly because you suggested it would not be as helpful as we thought. by the same token, we always knew that when you returned we

could read the press release. this is a developing country. the process is long. we have to be very sensitive to their feelings. they're making some progress. we have heard that. now i know you have given careful study to the ryan-murphy bill. the president's frustration is that whatever bill he has or supports, he knows that what happens in congress will support it. it does not make any difference the merits. just say no is part of the minority party's view. having said that, i can see where you are making a careful studying of the bill. is there any way i can find the language to ask you after you

study this bill, could you possibly tell us what the president would support in terms of declaring china as a country that is manipulating its currency? i know that under better circumstances we should have bipartisan support on foreign policy and foreign trade, but that is not a reality now. bank question to you, mr. secretary, -- my question to you, mr. secretary, after we have done all of this careful studying of the bill that we have concerns about, would it be wrong to ask you to recommend to us how you would like this to be handled legislatively? if you think we have reached a point that diplomacy is not working -- we do not want to be a bull in a china closet. but there does, a point where

diplomacy does not seem to work in need a little bit more -- there does come a point where diplomacy does not seem to work and you need a little bit more. ce.i'm not arguing for patient i'm not suggesting that we should sit back and wait for china to develop. >> i am sorry that has always -- i'm sorry. that has always seemed like your position. i will strike that. >> from the moment i came into office, it is very important -- it was very important to let things react to market forces. we were in the midst of a devastating, global, financial crisis. china had decided there were going to hold their currencies stable for a period of time.

at the same time, the currencies of all of our trading partners fell sharply against ours. china made it clear that until there are confident that the recovery had been established they would be reluctant to let the currency move. we spent that entire time trying to let them know that time should come sooner. they waited until june of this year, after they had more than a year a pretty solid recovery and growth, to let that process began again. they have only move 1.5%. their recovery is very resilient. exports are doing fine. their economy is doing fine. we think they have substantial room to let the process work now and i am not arguing for patience. i do not suggest that the question about the merits of this particular legislation

needs a protracted and in that -- needs a protracted -- >> i am over my time. i was just asking a question as to whether or not the administration could suggest any legislation that would allow the congress to declare china manipulator and that it would be positively received by the administration. i was not referring to ryan- murphy, but any legislative solution. >> as i said earlier and i mean this seriously. we are willing to work with you on trying to design legislation that would meet these tests, consistent with our obligations internationally and be effective in giving us leverage to advance these interests. i know i said and we're committed to working with you on that. >> thank you.

>> mr. van hollen. >> thank you, mr. chairman and secretary geithner. you indicated there is a direct connection between tax policies and deficit. there was a republican leader in the senate, senator mcconnell put forward a proposal that would add $4 trillion to the debt, essentially doubling the deficit over the next 10 years. as i understand the figures, china holds about 10% of the debt. states' that is about an additional $4 million of debt that would be purchased by the chinese if they decided to do it -- $400 million

of debt that would be purchased by the chinese if they decided to do it. the danger is that it will have a drag on economic growth going forward. i want to get back to you about your opinion on what impact those big deficits will have on job creation. as you indicated during the previous administration they enacted tax cuts for wide group of americans. the tax cuts for middle-class americans -- 90% of the american people -- were set to expire, by their terms, at the end of this year. we're saying that we want to extend tax relief for 90% -- 98% of the american people. we are hearing an argument that it will have an impact on small businesses. the nonpartisan, joint committee on taxation has indicated that only 2% of small businesses fall

into this category. what we find further -- it is very interesting. if you look at the definition of small businesses, including partnerships, elsie, as corporations -- llc, s corporations -- you find hedge funds, members of fortune 100, lobbying firms who are classified in that area. it is important to end this myth that this would impact small businesses. i do not think anybody would consider an entity in the fortune 100 to be a small business. at the same time, that alone would add $700 billion to our deficit over the next 10 years. with respect to the chinese currency situation -- i really think your testimony says it all without reaching the ultimate conclusion that i think many of us in the congress are reaching.

you indicate that you agree with the imf assertion that china's currency is "significantly undervalued." you say right here, china took a very important step when it announced that it would renew the reform of its exchange rate. you point out that three months later the chinese have allowed their currency to appreciate our only 1%. they did get some credit for making that announcement three months ago. they have to get the criticism of having not met anyone expectations 3 met slater -- three months later. there is no way to send a signal that we're serious without congress moving forward on something, whether it is the ryan bill in the way it is written or with changes. it is my view that the congress should act now. there is a report coming up in october. it seems there is no way, given

the facts, that you're wanting be able to go back and report that there in compliance with the situation now pits of thing has to be done between now and then. believe we need to take some action. let me end with this question. there is this intimate connection between our deficit and debt and our relationship with the chinese in china. what do you think would be the impact on our economy, jobs, future growth, of taking up the proposal that senator mcconnell put forth? it would add $4 trillion to our debt. what would be the impact on jobs? >> congressman, let me answer the question this way. let's contrast two proposals for what to do for the american economy today. one proposal is to extend and make permanent all of the bush tax cuts, including those for the top 2% of americans. i will give you the alternative

proposal of the president, which is that we act today to extend the tax cuts to the middle class -- 98% of americans. we put in place new incidents for business investment in the country. we make permanent an expanded credit for research and development conducted here in the united states. we jump-start a multi-year program of a mess and in public infrastructure. if you compare the impact on the economy on growth -- program of investment in public infrastructure. if you compare the impact on the economy on growth, the president -- the president's strategy as the most short and long-term benefits -- has the most short and long-term benefits. the impact on long-term growth is hard to measure. under the proposal supported by many republicans in congress, we

would have to go out and borrow $700 billion, add that to our national debt, so that we can give a very expensive tax benefit that just goes to 2% of americans that no economist regards as particularly effective. it would undermine confidence in investors around the world and the american people that we're serious about bringing our long- term deficit down. one thing we have learned is that tax cuts are not free. we have to pay for programs we put in place. i think there is a trade-off.

>> thank you. >> under our rules, i think i need ask her to go next. >> i would be willing to defer to that side first. >> to was here when the gavel dropped -- she was here when the gavel dropped. you are very kind. >> i would respectfully disagree about the $4 trillion in debt. having actually run the business myself, i know of many economists who take a very different view on tax policy. i would suggest we have a spending problem more than a revenue problem. one thing now saying about the general's assertion of a lack of support in the majority -- i

like to insert into the record a letter dated september 15, by 31 members of the democratic congress -- caucus specifically asking for extension of the current tax policy to provide some predictability and stability to the economy. changing the subject back, tax policy and spending policy are issues. i would like to bring the focus back to china. what is your sense, looking at asia right now -- we all agree that chinese currency is undervalued. that is a problem. it affects the ohio value, in is a source of great personal frustration -- and it is a great personal frustration as well. there is disagreement on how we should respond. the ryan-murphy bill is one approach.

there are others. how effective do you think unilateral u.s. action would be, such as tariffs, and in forcing the chinese to appreciate their currency, particularly considering the wto consequences? >> we do have independent tools that are fully consistent with the wto and our agreements with china. where those can be effective, we should use them. it the critical test is whether they can withstand a challenge. there is a bad and range of things we could do that needs to be tested -- a range of things we could do that need to be tested. >> one thing i have noticed from quiet diplomacy is that we've seen and appreciation in the you on -- yuan.

are there any lessons from that? >> there is a substantial and meaningful change in electronic concern -- in china's currency behavior. it was interrupted by the crisis. i think it is encouraging because it shows that, even with the gradual move, there can be a very big change in relative prices in the basic economics of this changing relationship -- in this exchange relationship which can have big benefits to american exports. when i draw from that is promising. i thought it was important to highlight that china said it would resume the process of reform because they described that strategy in 2005 and 2006 as a long-term reform. between 2008 and 2010, it was

described as a temporary suspension. our look back over that time and say even that gradual move -- i would look back over that time and see the gradual move can make big changes. >> i would yield my time. >> thank you for yielding. mr. secretary, was the so-called stimulus to large or too small? >> this is in response as the cbo's report. the stimulus had a very substantial effect on restarting economic growth and saving millions of jobs from the risk of loss. if you look at the combined effect of what recovery act did, what the federal reserve did, and what actions we took to put out the financial fire, you have an economy in free fall in the

first three months of 2009, the second half of 2008. we had not seen anything like it since the great depression. that stopped. you saw growth restart remarkably quickly. even though we're digging out of this too slowly and we have a long way to go, it is important to recognize that we have had job creation by companies in this recovery start -- i think 18 months before it did in the recovery of 2001 and 2003. even though we're facing a lot seeing anges and we're tougher recovering, we have been growing for more than a year. we have job creation come back sooner than we did in the last recession, which did not have the same challenges we face in this crisis.

the recovery made an overwhelming difference -- recovery act made an overwhelming difference. it had some very substantial tax incentives as well as support for infrastructure and benefits to the unemployed that made a big difference to incomes. >> in answer to my question, it was just about right? >> that is difficult. let me answer a different way. even though you see the private sector healing and we're in the fifth quarter of economic growth, we're not coming out of this astana. if washington -- out of this fast enough. if washington does nothing, we negative frothis having a impact on growth. the debate we should be having is what is the best way to support the middle class and small business. any recovery depends on the

private sector restarting job creation. in the first six months of this year, it has increased at a rate of 20%. you are seeing encouraging signs that companies are investing again, but not at a pace that will allow us to bring down the unemployment rate fast enough. it requires sensibly-design, fiscally-responsible incentives. we're trying to make sure we're giving the middle-class more confidence about what their taxes will be in the future and stronger incentives to businesses. >> your answer is it was too small? >> i am not saying that. recoveries following crises are tough. they follow a period where americans were living beyond their means. it caused a huge crisis in

confidence. we're not prepared to make the mistake that others have been the past which is to too quickly decide that the obligation of a government is over and how policy shift to restraint. that will push growth rates down and keep people out of work. best way to avoid that is for congress to act. we need conagra -- when the congress to act. it is not some and we can do. we think there is a very high rate of return in well-designed tax incentives for investment. we proceed -- we propose some. we think people would be much more confident if those were put in place. >> thank you. >> i think you are our last. thank you for your courtesy. >> secretary, the state of

california has lost arguably, the largest number of jobs due to a host of unfair chinese trade policies. my district is ranked 32nd are the ball 35 congressional districts in jobs lost -- out of all 35 congressional districts in job loss. we have argued to what degree chinese currency is undervalued. there is consensus that is significantly undervalued. that does provide a huge disadvantage for our exports in relation to chinese exports to this country. several people have suggested different ways of trying to attack the problem. i'm curious to know whether the

obama administration has a position on the currency reform for fair trade act. it has 143 co-sponsors in congress, members on both sides of the aisle. >> as i said today, the administration has not yet taken a position. we're looking carefully at that in terms of whether it is consistent with our obligations internationally and whether it has the right mix of leverage. we're looking at it carefully, but have not yet taken a position. >> the other thing now like to ask -- clearly we're not only country -- the only country that suffers from unfair trade practices. we have some allies who are stuck in the same situation. the situation has been likened to children on a schoolyard who

agreed to the ground rules for a game. china is a 800-pound gorilla on the block that we find out is cheating at the game. there is consensus among everybody playing the game that there is something underhanded and unfair going on. people are grumbling pitted if the analogy further, they are playing for lunch money -- people are grumbling. to take the analogy further, their plan for lunch money. yet, nobody wants to stand up to the cheater because they fear retaliation. my former background shows there is power in numbers. i believe that other countries like brazil, japan, the european union, have a vested interest in seeing china play by the rules, which they have agreed to in treaties. my question is what do i tell my

constituents or the small businesses in my district who been financially impacted by unfair trade? what can i tell them other than we want to talk to them about this problem? what can i tell them that you and the administration are doing to try and help remedy this? we have hit this critical juncture where we either stand up for ourselves or china grows too big and too strong and we are forever at their mercy. i quite frankly do not relish the thought that the united states ends up in that position. >> i like your analogy a lot, with one exception. this is important. people are very concerned about the challenges we face as a country. .e're the 800-pound gorilla >> there is a 700-pound gorilla standing next to us. >> not even close in relative size. largest and most productive

economy in the world. we have technology. we are vastly ahead of them. >> shouldn't we have the leverage to stand up against them? >> excellent point. you are right to say that we have a job to hold them to the rules they have agreed to. we have two basic things that we have the authority to do, even with the current law. one estimate sure that american firms can use our laws to make sure they are protected from both unfair trade practices and surges in imports from china. we're using those very effectively to give those protections. the second is that we of rights under the wto -- we have rights under the wto to make sure that china is not limiting or unfairly discriminating against us.

we're using those tools much more aggressively and very effectively to try to get better protections for intellectual property and less discrimination. we have a long way to go. we're having an important debate. we're in heated agreement on the objectives. we are concerned. the challenge is, what is the best set of additional tools or leverage or persuasions that we can use? we're working very actively with countries around the world who compete with china. many of these practices have more adverse effects on them. china interact more directly with them than they do with us. we will try to use all of these tools and work with you and your colleagues to find better approaches. >> i appreciate your answer. i want to encourage you to look at the currency reform for fair trade act. i yield back.

>> i think that is an appropriate place to end. mr. secretary, it has been a long day. i think you started over on the senate side at 10:00 and the fed bank meetings after that. we appreciate your time, your talent, and your dedication. we are proud that you were here -- are here. you will be hearing more from us. we will be talking to each other. with that, thank you. we stand adjourned. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010]

>> if consumers do not trust us, if they bought it -- if we violate their trust, they will not come back. >> "the communicators" continues its look at privacy and the internet on c-span2 tonight. >> every weekend on c-span3, experience american history tv starting saturday at 8:00 a.m. eastern. 48 hours of people and events telling the american story appeared here historic speeches by national leaders and eyewitness accounts of events that shaped our nation. visit museums, historical sites, and college campuses. talk to leading the store since -- leading historians.

american history tv -- all weekend, every weekend on c- span3. >> today's state department briefing includes parliamentary elections in afghanistan, the american hikers still being held in iran, and the middle east peace talks. this is about 25 minutes. >> good afternoon. welcome to the state department. at the top, the secretary is in new york today at the u.n. general assembly where she is participating in a full day of events and bilateral meetings. much of today's focus is on our ongoing commitment to reconstruction efforts in post- earthquake haiti pitch to a committee -- for debate in two memorandums today.

she will attend a special session of the interim haiti recovery commission to review the status of the recovery effort. she participated this morning in a meeting of the gulf cooperation council of foreign ministers. she has a series of bilateral meetings with the prime ministers of australia, china, mexico, and israeli defense minister and the eu high representative. p.j. will provide readouts of all of those. i am sure the plans to brief this afternoon. a word about the car bombings yesterday in iraq. we expressed our strong condemnation in response to those car bombings yesterday in iraq. our sympathy goes out to the victims of these cruel and inhuman attacks. attacks by terrorists have

killed scores of defenseless citizens. we support actions by the iraqi government to assure the security of the iraqi people. it is essential that the current government continues to provide security and other central services to the iraqi people. finally, i believe there was a media note earlier this morning. the assistant secretary for political and military affairs will host the u.s.-australia political-mohler terry -- political-military talks which will focus on a wide range of issues including shared strategic challenges and the continuing efforts to enhance partnerships in security cooperation, peacekeeping, nonproliferation, and disarmament. i will take your questions. >> the first question has to do with the afghan parliamentary elections. some number of candidates represent a party that is connected to someone we consider

to be a terrorist. is the administration concerned about these folks, if they win seats, having our that could undermine the effectiveness of the government? . >> we believe the afghan people can be proud of millions of their citizens, men and women, killing to the polls despite it -- despite repeated threats by the taliban and. this election saw significant security incidents from last year's presidential elections and it is important.

we have elections yesterday or over the weekend, and we're going to wait to see how it plays out. we're looking for results in early october. i will have to take the question about significance. >> what message do you think this election sends to the taliban about democracy in afghanistan? >> sends a clear signal that the afghan people are not backing down. it was not perfect security situations but the security forces did perform admirably. and people did get out and voted. that is a significant turn out and we believe it speaks to their thirst for democracy and democratic change. >> de think the government is

now in control -- do you think the government is now in control? >> obviously the long-term goal in everyone's interest is to have afghan governments throughout afghanistan, to extend that governance to provide stability and security for the american -- the afghan people. it means our troops go home and the afghan people can enjoy the real friends of democracy. issue is another step in that direction. how do not want to overstate it but the fact that violence, although tragic and terrible, was less than last year's presidential elections is significant. and the security forces did a good job. >> one more time a. -- if i may.

[unintelligible] many regional governments including india is asking that is not time for the u.s. to leave afghanistan because it would send the wrong signal and you are telling them that we're leaving. >> i think we've said repeatedly both here and in afghanistan to no one is talking about the u.s. leading next summer. any kind of assessment would be based on conditions on the ground. that is what general petreaus has said repeatedly. in terms of a broader commitment, the u.s. his obviously engage in afghanistan for many years to come, as is the international community.

this is about afghanistan? >> an ambassador in washington this morning said that he sent a letter to the state department saying that they cannot accept the u.s. ambassador. do you know about that? you know they will retaliate in some way? >> shourd. -- sure. whereupon remains our nominee. almer remains our nominee. we of received a communication from the venezuelan government but they do not want to enter into discussions on that. we do not talk about our diplomatic communications generally speaking.

i will reiterate that palmer remains our nominee for ambassador. >> whether the withdrawal or not? >>, head. >> have you received any message from the venezuelan government criticizing a visa to enter the united states for someone to make conducted bombings? >> we received the diplomatic note. regarding his presence or legal status in the united states, i leave you to the department of online security -- of homeland security. >> they seem to be sending questions to you about these issues.

i knowledge that we did receive a diplomatic note. but in terms of his status, that is a case for them to -- but we can hash it out afterwards. it is that vhs matter, though. -- a dhs matter, the. >> there have been issues with china and bilateral exchanges with japan. what about the japanese decision to keep the chinese capt.? >> this is all the million issued between these two governments and countries. but this is ultimately a decision between these two governments and countries. the secretary spoke about the importance of stability and

peace in the region, and again reiterated our strong desire to see this worked out between the two countries. but i will leave it that. the head. >> to the peace talks? the secretary -- the achieve no progress whatsoever. could you share with us how the secretary feels about progress this week? >> @ think the secretary remains upbeat in the sense that we have got both sides in direct negotiations, which was a longstanding goal. are there going to be frustrating moments? most likely. these are tough issues. and they are issues that need to be discussed, but we remain

optimistic, because we believe that both parties talking will lead to progress eventually. i do not want it into any of the details. >> in some of the details the secretary says that they made some offers last week for settlements [unintelligible] and that the negotiations go on , and if the borders are determined, then the palestinians could go back. israelis arend the too enthusiastic about it. >> it is hard for me to get into the substance of the negotiations. adelaide senator mitchell has been quite clear that we're not going to do that. we know what all the issues are, and you had mentioned a few

of them in your questions. we had could talks last week. those talks will continue and i believe senator mitchell is in new york this week. we're not going to prejudge anything. all of the issues are on the table. eel that the absence of prime minister netanyahu from the general assembly -- >> these obviously take place and a number of different levels and that is fine. >> you will be meeting with senator mitchell and the president on monday. >> i'm sure that he can express the views of his government. >> [unintelligible]

>> i do not. i know that the secretary did meet with him briefly on friday. she had a very full day. she did meet with them and obviously they discussed the wide range of issues that are integral to our strategic partnership. i do not have a specific account. >> china is helping pakistan build another nuclear facility. i know that there are u.s. objections to two that are under way already. >> i had something here. generally speaking about china, it will live up to its commitments.

will sit by and get more on that. -- i will see if i can get more on that. >> there's apparently some trouble after the shooting. were there specific concerns for safety there? >> i am not aware of it. did it happen in the morning? >> 1 message would be about a general threat, not necessarily to american citizens but keeping them apprised of possible security incidents. i am not sure, but it would not necessarily be a threat to americans. it is a matter and issue of security -- of concern. >> a couple of questions about our run.

has the united states reached out to of many job -- and the new job -- mahmoud ahmadinejad for his role in helping? >> we're very pleased and happy to have ms. shourd home. we also call on the american government to release -- the iranian government to release the other two hikers still held in iran. we have the capacity to resolve this issue internally and we hope that that would extend that to the other two hikers who are still there. i am not aware that. tore express our gratitude the people of beaumont -- oman. >> are you aware of any specific role he may have played in the

release? >> i am not. >> does this provide some kind of opening during his visit to new york this week? >> to that regard, there's always an opening for us to -- the essence of our approach to iran is to keep that door open to engagement and discussion. absolutely. >> to the release open that door further? >> we're pleased to have her own. -- her home. we're still cognizant that two hikers remain in iran. hmadinejad --

>> i am aware of the comments he made in a couple of interviews that he gave yesterday in new york. we would say that there is no equivalence between these individuals who have been either charged or tried and given due process in a court, and these hikers who were crossing an unmarked border and have yet to be charged. i would call people's attention to that. >> in one of the interviews that he has done so far, he says that the u.s. should express -- except a run as a major player. is that a role the united is government is ready to entertain gross margin -- ready to

entertain? >> we will like to have more engagement with a run and talk to them about their nuclear program, and from there seek greater engagement. we've always said that we will remain open. we recognize the people of iran as important to the region. we recognize that they can play an important, constructive role but that is a decision for the rwandan government to make. they need to live up bridges live up to their international commitment. -- a decision for the iranian government in may. they need to live up to their international commitment. i can try to get that for you. >> elections in birminurma --how

you view them over there? >> i think we spoke to that on friday. another discouraging sign from the government of burma that elections will anything but democratic. [unintelligible] would that be a short discussion? >> i cannot predict what will be happening in every discussion with asian leaders but i can expect that it is a matter of concern for us. >> a question on india. [unintelligible]

will the secretary be meeting with that japanese and chinese officials? >> has a set a few minutes ago, i cannot predict what is on her agenda and every meeting, what she will and will not discuss. it is an issue that we are watching closely. as i said, it is an issue we do not believe should be handled between the two countries. >> just of the weeks ago, there was tension on a number of issues like the parliament [unintelligible] on thursday, this is going to air and targeting only india,

[unintelligible] causing more the problem between india. >> between the u.s. and the indian government? >> yes, this is you is among americans here. only india, and not others. >> i'm only vaguely aware of this. i would just say that we have a deep and abiding relationship with india that functions constructively on so many levels. also a deep abiding respect for the indian culture and for the indian people, the world's largest democracy, and economic

powerhouse in south asia. so i would not read too much into some television show a need to watch more tv at night. i would encourage the indian people and government not to put too much emphasis on that. >> [unintelligible] >> again, this has been -- are believed our assistance secretary said it your guess is as good as mine. we do not have the readouts for that. you talk about that meeting?

we do not have any. nothing to announce yet. >> in the state's grant political asylum to a mexican journalist -- is the united states granting political asylum to a mexican journalist? >> i will look into that. >> if consumers do not trust us, if we do something to violate their trust, they will not come back. >> all month long look at privacy in telecommunications policy tonight with yahoo's anne toth on c-span2. >> i underestimated how big the job was. i am not even been a minority leader. i jump from minority whip to speaker overnight.

and from a minority party that no one thought would be in power which was -- into the biggest one party increase. >> nude cambridge on his tenure as house speaker and a possible 2012 presidential bid sunday on c-span. >> not a senate hearing on embryonic still supported stem cell research. we hear from the director of the national institutes of health about legislation in response to a recent court ruling banning -- banning federal funding for that research. this is 15 minutes. -- 50 minutes. >> the subcommittee will resume its sitting. dr. collins, two other things i wanted to cover with you.

one, in your testimony -- and you mentioned it also in the slides -- was the power of embryonic stem cells as a research tool. sounds like even if these cells never actually end up being used as therapies in which they are transmitted into human beings, they can still teach us valuable information that can lead to treatments and cures. i just want to ask, is that correct? and just a slight elaboration on that. >> that is correct. and in two ways. one is that human embryonic stem cells, because they represent that most potent, most undifferentiated cell type, but can be encouraged to go down various pathways to become brain cells or blood cells or muscle cells, they give us a window into how that development happens in humans in a way that we didn't have before. and, again, if you are able to understand what those signals are, you can also infer what goes wrong if one of those

signals misfires, and many birth defects and genetic diseases are in that category. the second way is the ability to use these cells, particularly if you turn them into neurons or muscle cells or whatever it is that you need to study most to screen for new drug therapies. the way we get drugs in the past has been involving a variety of approaches, trying to identify a small molecule and organic compound that would have the right properties to do something you wanted to, but you've often had to try that in an animal model. these are human cells, and they're human cells that you can convince to behave pretty much the way they would as a person, except they're there in the dish, so you can do it without the risks of toxicity. very powerful new way to feigned the next generation of -- find the next generation of drugs. >> dr. collins, this is more on a personal note. opponents of human embryonic stem cell research sometimes argue that it's immoral.

they've raised it into a moral issue. quite frankly, i have a number of friends, but i have one very close family friend who had a lot of trouble conceiving a child. she and her husband tried many different things. they finally went to a fertility clinic and to in vitro fertilization. she was able to conceive and have a wonderful child. actually, twins. they are very healthy. and so that's a real blessing that science was able to help them. now, i don't know this for a fact, but in many of these cases a lot of the embryos are left over from a process of in vitro fertilization, and at some point the donors of asked

what they want to do with them. obviously, they're not going to keep them in liquid nitrogen forever. so they're discarded, to which sometime ago my friend said to me, well, but i understand they could be used for embryonic stem cell research that might help someone who is suffering. and i said, well, yes, that's true. i would much rather do that. so seems to me there's some morality there that we haven't thought about. and as you know, under the guidelines that were issued, only stem cells derived from leftover in vitro fertilization can be used, with full consent of the donors and with no monetary consideration, and

could not be transplanted into a uterus. had to only be used for stem cell derivation. so those are the ethical guidelines. i thought i'd lay that out. a lot of people don't understand that. but you are well known not only as one of the world's most well known scientists but as a man of faith. i actually did read your book. i thought it was very good. "the language of god." i think it's one of the wonderful crossover books between science and faith. it's a wonderful book. can you talk about why you personally, as a pre-eminent scientist, are comfortable with this research? how do you reconcile your advocacy for embryonic stem cell research with your own faith and your own moral judgment? >> thank you, senator. i think you've already articulated the issues extremely well. i do believe that the human embryo deserves moral respect. it is a potential human being, this coming together of sperm and egg. it's the way we all got started. and that is not something to be

taken lightly. but when you look at the circumstances that you have just outlined in terms of the consequences of in vitro fertilization efforts, benevolent as they are, giving couples a chance to have children who otherwise could not, one of those consequences is the existence of hundreds of thousands of frozen elm bee yoss and others that are -- embryos and others being discarded potentially all the time. and then faced with the ethical choice in that situation, i have come to the conclusion as a person of faith that the alternative of discarding this embryo that's clearly not going to get used versus, for a small number of these, trying to turn them into a stem cell line that might ultimately teach us something about human development and medicine and ultimately help us come up with a treatment for parkinson's disease or diabetes or spinal cord injury or some eye disease

or liver disease. which of those is the more ethical choice? i think it's too easy to simply say, well, the embryo is an entity that is a potential human and, therefore, any consideration of using the word "research" in the same sentence is something we should be opposed to. we aren't really being given that as an alternative. these embryos exist. they're going to continue to exist as long as in vitro fertilization goes forward, and it is. certainly it's given many couples a chance for a new life and their families. so putting the reality test here, i believe that most people who look carefully at the issues, whether from a faith perspective or a purely humanistic perspective, come up with a conclusion that what is potential here justifies what we are talking about in terms of federal funding of human embryonic stem cell research. >> well, thank you very much for that profound statement. thank you very much, dr.

collins. now our panel -- i'll introduce our panel here, and then we'll have our testimonies. dr. george daly, professor of hematology and oncology at children's hospital in boston and the dana far ver institute, also at harvard medical school. dr. daly is past president of the international society for stem cell research and chaired the international task force that wrote ethical guidelines for human embryonic stem cell research. he received his ph.d. from m.i.t. and his m.d. degree from harvard medical school. dr. shawn morris, director of the university of michigan for stem cell biology, is also a professor of immediate sib and a professor in the life sciences institute. es he also a director of the international society for stem cell research. received his ph.d. in immunology from stanford university. gene nelson is an prosht

professor at the department of aanatomy at wayne state university school of medicine. dr. nelson received her b.s. from the university of michigan, her ph.d. from wayne state university. and ms. unser is the founder of the first step foundation, an organization dedicated to raising research funds and public awareness for people afflicted with spinal cord-related paralysis. ms. unser graduated in may with a degree in biopolitics and is now a graduate student at the george washington university school of public health studying health policy. i thank you all for being here today. i thank you for your indulgence because of our votes. i will make sure that all of your statements are made a part of the record in their entirety, and starting with you, dr. daly, working down, if you could sum up in five minutes or so -- i won't hold you to an exact time, but we'll

start with five and try to get there so we can open it up for some discussion and question. again, dr. daly, no stranger to this subcommittee. welcome back. >> thank you very much. chairman harkin, thank you for the invitation to testify. i am here to assert that human cells offer unique advantages for understanding human diseases and are essential to a vigorous national portfolio of stem cell research. however, recent upheavals in the federal funding are disrupting our research and dissuading scientists from entering the field and threatening american pre-eminence in the research. as director of the stem cell transplant program at children's, i wish to first speak to the success we have in using adult stem cells. and we're using adult stem cells to cure kids with a variety of life-threatening diseases. we perform some 80 stem cell transplants per year for childhood leukemia, genetic diseases, and indeed, we have cured many kids. i was on rounds last week the i met an adorable little girl about to receive her transplant

for a very rare genetic immune disorder. and i found out she was the second in her family that we could very confidently say we would cure. so it's very, very heartening to save the life of a child. but i'm also here to advocate as a scientist. and as a scientist, i'm sobered by the statistic that fewer than half of all patients treated with stem cells are cured. and despite 50 years of research in adult stem cell transplants and practice, this is our most successful. blood cancers still relapse and patients still die. so as a scientist i'm working to improve these treatments through research on adult stem cells, embryonic stem cells and induced potent stem cells. i think it's a flawed argument to say that scientists should restrict their focus to adult stem cells and it's a mistake to cast the different types of stem cells as competing priorities. adult stem cells are not better

than or more promising than embryonic stem cells. embryonic stem cells are different and to many scientists they offer more hope in certain diseases like diabetes. would it make sense as a federal policy to fund cancer and cord ya vascular research but not diabetes research? all of these are essential, and the most successful strategy to advancing cures is to let scientists decide which cells to study. now, i've been a student of the adult stem cell for 25 years, but starting about 15 years ago i began envisioning a new approach to the research to generating blood stem cells from embryonic cell cells. and the idea was that we could generate customized blood stem cells in a way that would solve the immune rejection problem and the shortages and allow us to perform gene repair, together with bone marrow transplantation. now, we've succeeded in mice and we have a lot of promise in

humans. in 2007 i was one of three laboratories to produce induced plurey potent stem cells and in 2008 my lab produced the first large repository of human disease-specific i.p.s. cells. so why, given that i have pioneered the development of both adult stem cells and induced potent stem cells do i continue to advocate for human embryonic stem cells? well, there's several reasons, and the first is that i.p.s. cells and many other future areas of research are founded on the knowledge we have gained from human embryonic stem cells. second, my own research and that of others is pointing to important differences between i.p.s. and e.s. cells. and third, some diseases are simply more effectively modeled with human cells than. i p.s. cells. we showed that you can model human anemia, a disease that pre-disposes kids to leukemia,

as well as fragile x syndrome, which is the most common genetic cause of autism and mental retardation and these were better modeled with human embryonic stem croils. while we have so much to learn, how can we conclude that we don't need to fund the research? we're told that restrictions on federal funding won't inhibit stem cell research and that private philanthropy will fill the gap, but realistically research careers are founded on the architect of federal support. investment by the n.i.h. has made u.s. research pre-eminent. it's given us domination in the nobel prizes and it's been an engine for our very vigorous biotechnology industry. now, opponents of e.s.l. research will argue that adult stem cells are more promising. that embryonic stem cells have yet to cure anyone. this is like arguing why try to develop new classes of antibiotics when we've got ben sill lins and let's continue to improve those. it's very curious.

the only time i confront the argument that adult stem cells are superior and that embryonic stem cells should be replaced is at hearings like this. at scientific meetings, we discuss and debate adult and embryonic and induced pro tent stem cells as all complementary aspects of cell and developmental biology. in my opinion, the arguments that adult stem cells obviate the need for embryonic stem cells are not scientifically driven. they are etiologically driven arguments to suppress e.s.l. research. and no matter how much progress is made with other forms of stem cells. e.s. cells will remain a vital research tool. e.s. cells are not contestants on "survivor" that should be voted off the island. expelling these cells will gravely weaken the search for cures. president obama's policy has expanded as sess to more e.s. cell lines and the court

challenge has really come on us as a major blow. we've had immediate disruptions, but the long-term uncertainty is even more insidious. and i have several trainees who have toiled to make their projects on human e.s. cells work and the uncertainty has really compelled some of them to abandon those plans. so these decisions, which are driven by politics and not science, are deeply disturbing. so let me finish by saying that although the injunction has been stayed with the latest upheavals, we're again reminded that human e.s. cells are fragile and new legislation is needed to sustain the mo ten tum of e.s. cell research and to allow scientists and not politicians nor judges to determine which research priorities to pursue. thank you. >> dr. daley, once again, thank you for alhave profound statement and for all the work that you've been doing in this area. now we turn to dr. morris. dr. morris, welcome. >> thank you, senator harkin,

for the opportunity to testify today. i've spent my entire career doing stem cell research, almost exclusively adult stem cell research. the research in my lab has won a number of awards, including an award from president bush in 2003. nonetheless, like nearly all leading stem cell researchers, i believe the federal government must support all forms of stem cell research, including human embryonic stem cells. we simply do not yet know what kinds of stem cells will yield the breakthroughs of the future and must pursue all forms of stem cell research to develop new therapies sooner, rather than later. stem cell scientists don't cluster into adult versus embryonic camps. this framing of the debate comes from political lobbyists. i interact regularly with hundreds of the leading stem cell scientists throughout the world and virtually all of them believe that research must continue with all types of stem cells for the reasons george just articulated. stem cell research is a remarkably fast-moving field that has taken a series of unexpected twists and turns

over the past several years. there's no point in the last 10 years where we could have predicted, even two years down the road, where the field would be. yet, at every point there have been people who believe they could predict the future and who could tell us which avenues of research should be abandoned. but until the research is done, we don't know what the answers will be. think about the arguments that opponents have made as alternatives to embryonic stem cell research. first they suggest that umbilical cord stem cells could replace embryonic stem cells. i can tell you that there was any any scientific plausible basis for the argument that cord stem cells could do what embryonic stem cells can do. instead, they subsequently suggested that amniotic cells could replace embryonic stem cells, but those cells are biologically different from embryonic stem cells and were never a plausible alternative.

again, you never hear about those cells anymore. then opponents circulated lists of over 70 diseases they claim could be cured with adult stem cells. what they don't tell you is that only diseases of the blood-forming system are routinely treated with adult stem cells and many of the other treatments, in quotation marks, they cite are highly speculative are often not based on sound science and are prohibited from being sold to patients in this country by our food and drug administration. the reality is that many types of stem cells are likely to yield scientific advances and potentially new therapies. and it would be foolish to place all of our bets on certain stem cells at such an early stage in the development of this field. for this reason the international society for stem cell research has repeatedly recommended that all forms of stem cell research must be pursued and that patients should be cautious about claims regarding unproven adult stem cell therapies that are offered overseas. where would we be right now if you had taken the advice of

opponents of embryonic stem cell research and directed the national institutes of health to focus their funding on umbilical cord blood cells or amniotic cells? promising research would be abandoned in favor of the alternatives, sacrificing scientific progress and the opportunity to develop new therapies. the award my lab received from president bush was for our work studying stem cells to give rise to the central nervous system. one of the things we discovered is that a birth defect is caused by defects in the function of these nurel stem cells during fetal development. in kids with this disease, the neweral stem cells failed to migrate into the intestine -- part of the intestine, rendering that segment of the intestine nonfunctional. our work suggested that we might be able to bypass that defect by transplanting neweral stem cells into the nonfunctional portion of the gut. the problem is that those cells only exist during fetal

development. so we decided to generate those cells by deriving them from human embryonic stem cells. i want to emphasize this point, because for the therapy we want to use a tissue-specific stem cell, a cell that in the newspaper is generally referred to as an adult stem cell and yet, we have to obtain it from embryonic stem cells. so this illustrates why it's scientifically meaningless to frame this debate as a choice between adult and embryonic stem cells, because we sometimes need embryonic stem cells to derive the adult cells that we want to use in the therapy. so this research in my lab is funded by the national institutes of health, but it's suffered from repeated delays. first the grant was delayed while n.i.h. put in place its new embryonic stem cell policy. then we received the grant but unable to spend the money until n.i.h. had the opportunity to review new stem cell lines for funding. and finally, we were able to start the research but eight months later the federal injunction was issued. in the first few days after the injunction i told my lab if our

funding was cut off, we would abandon our work on that disease. i have with me today jack mosher from my laboratory -- jack, you might want to stand up for a second. jack is the guy in my lab who does this work. the project i've been telling you about is jack's work and his salary comes exclusively from this grant. jack has dedicated the last nine years of his life to studying peripheral nervous system development culminating in this project, attempting to translate the basic science that we've done to the benefit of patients. yet, in those early days after the injunction, jack didn't know whether his work would survive the injunction, whether he would still have a salary, or what would happen to his career. so i'll just sum up by saying that american science is the envy of the world because it's a mery tock crease in which there's fierce competition to funds the best ideas. if we accept the principle that those who are not judged to have the best ideas can obtain judicial relief that blocks funding of the best ideas to

allow the lesser ideas to compete, this will erode the very hard of american competitiveness. we owe more to the patients suffering from incurable diseases. we owe it to them to support all forms of stem cell research so that no matter where the science leads and where the cures come from, we can follow the most promising avenues of discovery. so i would urge you to clarify the wicker amendment so that there can be no question regarding congress's intent to fund the most meritorious science. >> thank you very much, very morrison. and mr. mosher, thank you. i may even have a question for you when we get to the questions here. we turn now to dr. nelson, and welcome and please proceed. >> thank you very much, chairman harkin, for the opportunity to present this information today. i am a translational neuroscientist from wayne state

university. and today i am -- there are two types of stem cells, embryonic stem cells from elm bee yoss and adult stem cells. today i'm going to talk about adult stem cells. and we use the term adult stem cells to mean not just stem cells from adults, but also from children and umbilical cord from blood. and what you have to understand is that the first human adult stem cell was isolated in 1992. now, we do have a long history of doing bone marrow transplants which contain stem cells. but adult stem cells are actually, in terms of looking at other diseases and injuries, is a new field. and it was only in the late 1990st that we realized the potential for other diseases other than cancer and various blood disorders. and, yes, most of the federal

funding does go to adult stem cells, but the majority of that goes to old, but very important studies, in terms of treating cancer and blood diseases. the biotech industry that has a much larger budget for research than federal funding is not interested, in most cases, in adult stem cells. and we only have a limited amount of federal funding available. and where we are in adult stem cells, i'm sure the members have seen previously that there are some examples of people being treated with adult stem cells where there is considerable improvement. but the research is going from isolated incidents, and i'm going to present clinical trial

data in respectable journals where we need to move through clinical trials to standard of care. and to move from a basic science study is relatively inexpensive. several hundred thousand dollars. but for each clinical trial, you need billions of dollars. so we need a lot more federal support to move forward with adult stem cells. this is an example -- oops, i'm sorry. this is an example of one of the patients -- it didn't go on. ok. i'm sorry.

>> well, this would have been an example of one of the patients that was treated, a quadriplegic that was treated and -- treated using a procedure that was developed in portugal by dr. carlos lima and his team. and this is a picture -- i think we do have a poster of this gentleman that i met several years ago, and he was treated with his own adult stem cell two years after his injury. and two years after his injury, this gentleman is now shown standing up, without anyone supporting him. he's not waving, but he was in the video, and with only braces on his -- only braces on his -- on a foot-ankle brace. so he is standing up, maintaining balance.

and he can now walk with a walker. amazing. a quadriplegic walking with a walker without assistance. and this is the progress. but this isn't an isolated incident. if you look at the two publications that have been published in peer review journals -- >> doctor, can i interrupt for a quick question? >> yes. >> is he what would be referred to as atologous stem cells? >> yes, he was. and these stem cells were obtained from in his nasal -- from inside of his nose and used to treat his spinal cord injury. but this, as i said, isn't an isolated incident. there are peer review publications in a larger number of patients, and i would love the opportunity to bring this

forward in the united states after completing a safety study. so patients don't have to go to other countries to have this done. another example -- this is doug rice, and he had several heart attacks and had chronic heart failure. and he was told in 2002 that he had two years to live. and he went to another country and had a treatment done, and he's alive and doing well. at the time he had the procedure done he could barely walk. but this is also not an isolated example. this is a published peer-reviewed article of a study where they used 191 patients, had adult stem cells, and compared to 200 patients with similar heart conditions. and the treated patients lived

longer and also could zice more. now i have -- exercise more. now i have to move to a somewhat gross and i apologize for that. this is corneal blindness. this is the second leading cause for blindness in the country. on the left side it shows eyes of several surgeries that were unsuccessful and blind in that eye. but using stem cells, adult stem cells from their other guy, this shows the result several years later. and this particular one was 112 patients, and more than 75% of the time it was successful, and many of these patients regained normal vision in their eye. and let me just go to another example. so this is the study -- the published study that was published of these 112 patients in the new england journal of

medicine. i'll go to one more patient. i'm showing these sort of poster patients or poster examples. but now they're supported by results from clinical trials. in the middle is joe davis. he had very severe sickle cell anemia and his parents were told that joe might not live to his teens. so he had the procedure using his brother's umbilical cord blood cells, and joe is absolutely doing fine right now and has no sickle cell symptoms. and there's been two published studies for sickle cell, which is a very painful condition. this first study, six out of seven patients no longer have sickle cell symptoms. and another study at -- this

particular study was by n.i.h. scientists and published in the "new england journal of medicine" in 10 adults with sickle cell anemia. and most of these patients -- nine out of 10 of these patients no longer had sickle cell symptoms. the last patient that i'd like to show is barry gowdy, and he had multiple sclerosis. and he went to northwestern memorial hospital and he had symptoms of m.s., and they have disappeared. he was part of a larger study that was published in a peer-review journal in lancet, and these patients showed significant functional improvement, and no one got worse in this degenerative disease. >> dr. nelson, i would like to ask you to wrap up.

we have to get to the last speaker and we have some votes we have to get to. >> this is another study supporting that. i won't talk about the amazing results and newly diagnosed juvenile diabetes, but i'd just like to conclude that we need more federal funding. we need more n.i.h. funding so patients don't have to go to other countries and so these amazing results that i presented can go to clinical trials and become standard of care for u.s. patients that need their support. >> thank you very much, dr. pa doocy necessarily sofpblet and now, ms. unser, please proceed. >> thank you for allowing me to testify and use my voice on behalf of millions of americans living with debilitating diseases. i feel honored and frustrated as to why we are here today. 10 years ago my hero, my superman, christopher reeve,

sat in his power wheelchair and using every breath he took chanks to a machine testified to congress with the hope that embryonic stem cell research would be federally funded. today, in 2010, we are still fighting for this promising and hopeful research to continue. embryonic stem cells are science based on hope, hope for improving the quality of life for millions of americans by providing better treatment and eventually cures. my journey began 11 years ago. i was a healthy 12-year-old kid who was active and had big dreams. everything changed on february 5, 999. i can't recall how it felt to put my feet on the floor, how i got dressed that morning or what i had for breakfast, but what i do remember is that in a matter of 20 minutes my body became paralyzed and my life drastically changed. i was playing basketball at school and suddenly couldn't catch my breath and my head started pounding with sharp pain. the school i was attending called the ambulance and while laying down in the locker room, my lg became numb and tingly.

i picked it up, put it back down and couldn't feel the floor. i was scared out of my mind but i felt the doctors could fix it. it's an autoimmune disorder in which the immune system attacks the spinal cord, causing inflammation that damages the cells ta control sensory and movement of the body. after staying in the hospital for a couple of months, i went to rehabilitation where i learned how to do everything from a wheelchair. all the while having dreams of my feet imprinting in the sand. today i'm a 23-year-old woman who has learned to adapt to a life in a wheelchair and in a paralyzed body. even though i live life to the fullest and look as though i'm just sitting down in a wheelchair, i have to always worry about pressure sores from constant sitting. i worry about my osteoporosis advancing in my bones for not standing and bearing weight, which led to a fracture of my left femur. i worry about my scoliosis getting worse, curvature of the spine common with people with spinal cord injuries.

i have advancing nerve pain and bladder complications. i am one of millions of americans living in various diseases and conditions that no matter how hard we try affects how we live our lives. the first time hope actually went something to me and became sort of my religion was when i saw what human embryonic stem cells can do. a year after i became paralyzed, my doctor and stem croyle scientist, doug kerr, who was at johns hopkins at the time, showed me a mouse that was once paralyzed and now can bear its weight and take steps. at that moment i realized that this is science i couldn't ignore and it gave me a feeling of hope i wanted to fight for. which brings me to another point. it's frustrating to hear critics of this research say this is a path we can't go down and adult stem cells hold just as much promise as embryonic stem cells do. science is the pursuit of discovery and possibility. we should explore every opportunity and not count anything out because i can't wait. and i know millions of americans now and in the future

can't wait. in christopher reeve's testimony in 2000 he said "to obstacle should stand in the way of responsible investigation of their possibility." i'm here today to remove yet another obstacle in the path of this research, this answer, this hope. the political debate over this research is forcing many of our brilliant scientists to think twice about whether they should stay in this field. i know how dedicated and passionate they are about helping all of us find answers who are pained and suffering. if we keep dragging this debate back here to washington, in congress and in the courts, more and more scientists will either find a different research avenue or move to another country where they can pursue the promise that embryonic stem cells possess. once and for all i urge congress to pass unambiguous legislation that allows this research to move forward. i grew up around racetracks and my family has won the indianapolis 500 a total of nine times. the goal of every driver is to

pass under the black and white checkered flag first. the meaning of the checkered flag is winning. right now i can see the flag waving for me to go by, but with this current court ruling i feel that i have been driving under a long yellow caution flag. today i came here to say that this research is real, promising and hopeful to me and to others as we want so much to take that checkered flag and win our battles over diseases that constantly challenge our quality of life. thank you very much. >> thank you, ms. unser. we now have two more votes. . in your statement you alluded to claims that adult stem cell research is more promising than

embryonic because adult cells are already used to treat disease. could you expand on that? should we be disappointed that embryonic stem cells have not yielded a cure? and how about these pictures that we just saw of people that have been cured by adult stem cells? >> they were first created in 1998. we have only had 12 years in which to work on them. whereas the adult stem cell therapies are related to bone marrow transplant, so we have had decades of work on a stem cell therapies. the first attempt at bone marrow transportation between an unrelated and recipient was in 1955. all the patients died.

he went back to the laboratory to try to figure out why he could not transplant bone marrow cells into one donor and learned you had to match the immune systems so they did not attack each other. the first successful transplant was 1969, 14 years later. if we apply this criteria of abandoning the search that does not lead to cures with and 10 years as was suggested, then none of days stem cell therapies would exist today. most of the medicines we benefit from would not have been possible to develop. one line, you said cells are different in important ways. i understand you have a grant to examine this very issue.

tell me why this research is so important? what are the future discoveries that can be spurred? >> it is a major question to compare it this new and exciting research against the embryonic stem cell. we have won such a grant. i am losing a lot of sleep over the future of that grant. when the intervention was in place, it is threatened. it was going to be pulled. very promising projects where all at risk. what our research has shown is that where as our panel is to make these cells as close as possible as to the others despite our best efforts, and

there are still some differences. understanding those differences are essential to understand how they will be taped and all our research project. add to return back to the embryonic state, and they remember where they came from. that can be in it vantage. we are working with cells that are derived. eight your interested in treating the disease or a leader disease predict liver disease, the fact that the thing in this may athwart your research. it is so ignorant about how these new stem cells will function. we continue to depend on an rihanna extend cells. >> dr. collins, i see these

people that have been cured. i've had people like that in my own office who had stem cell treatment in another country. they come in and openly testify that now they can walk. one person had heart problems. why do we make of all this? >> the examples are exciting. to see the potential that is here. he was sent to appear reduce said something that god gave this to is for understanding whether our treatment works are not, blinding and recommendation. if we have not applied those standards, in the have to be skeptical. things happen and had nothing to do with the intervention.

>> a blinding? >> the patience and investigators cannot know whether that individual received the new treatment. brenda visitation, patients can randomize one of the other city do not have a bias. for all of this involves, and so an effort has been put through, we have to be a little bit concerned about whether it to the journal lies. -- has been generalized. the research has not yet reached that standard in terms of the spinal cord results. i think it is very exciting to see how that is. i'm not saying we should be supporting the research. but the clear about what we

consider to be proof of research. >> i have to go vote. i will give you a minute. >> he is correct. what i am saying is we need the funds

there is a problem and that this is a sur bi. they need to be brought onto the clinical trial where you do blinding of the patients, meaning the people don't know if they have received the treatment. we need to move in that direction. it is terribly expensive. >> do you think research funding should be prohibited? >> this gets to -- i am here as

a scientists and not as a personal opinion. what i came here to say is that in this country and other countries we have seen some results that are amazing that are published in the major journals that are clinical trials. we need the funding for adult stem cells so they can become standard of care. it does not do anyone could to treat five or 10 patience. >> i thank you very much for being here today. thank you for picking up christopher reeves mantle. i think our whole panel. i am sorry, i could stay here and talk about this another hour. i may submit questions in writing. thank you very much. thank you for being here. i'm sorry, i have to run.

us,f consumers don't trust they will not keep coming back. >> a month-long look at telecommunications policy, tonight with anne toth. >> every weekend on c-span3, experience in american history tv. 48 hours of people telling the american stories. hear eyewitness accounts of the

events that shaped our nation. top history professors and leading historians still into america's past. american history tv come up all weekend every weekend on c- span3. >> a discussion on election 2010 fund-raising and independent groups from today's "washington journal." host: sheila krumholz is here to talk about those independent groups, how much they are raising and spending. let's begin with what is 527? guest: it refers to the code in the irs that the finest political charities. 501 -- 527's art groups designed to run issue advocacies.

they are not supposed to be saying a vote against this candidate, but are supposed to be educating people about this topic. host: so they can at right -- run an ad like health care, i cannot say what candidate they support. guest: it has changed dramatically with the supreme court ruling, so there is a lot of confusion and there will be a lot of the envelope-pushing. host: it lies between what is a 527 and 501c4. guest: is tax-exempt and it is -- it need not report its donors. these organizations are getting big into independent expenditures in the wake of

citizens united and speech now. it means that we are going to see a lot of money going towards our alexians but will not know who is bankrolling the effort. host: before the bank rolled that these groups were able to do that anyway. you were able to donate to a 501c4 and they didn't have to let people know who they were donating to. how did citizens impact that? guest: citizens united released unlimited contributions to these organizations and they can now spend that money on direct advocacy, independent expenditures on behalf of the candidates. as long as it is not coordinated with a candidate, they can't accept a million-dollar donation

from a corpotion and a turnaround and say it is adding for a candidate. host: "time" magazine says -- guest: it defines itself as a nonprofit organization under the tax code. such a group may intervene as long as its primary purpose is the promotion of social welfare. this means the group's conducts hard-hitting issues -- this means that thinly veiled ads on behalf of republican candidates

-- host: that is exactly true. guest: they have pledged money already for this election, so that is a huge amount of money to be addressed at influencing the public vote. it is disingenuous for anyone to suggest this is good government information. it is money directed [unintelligible] host: do you have some idea who is donating to these republican groups? there is the american action network which is run by a former senator of minnesota. guest: american crossroads is one of the biggest story among these outside interest groups. american action networks is

modeled after the center for american progress is another organization that is a 501c4 urbanization. that is -- 501c4 organization. many have multiple arms so they have flexibility with how they spend their money. they can do so openly showing who is giving them the money. if there is any problem for the donors to be under the microscope, they can have that money go to their hidden arm and raise that money and spend it again. money -- raise that money aga for the candidates. these are kind of exhibit a end of exhibit the for what is

happening -- exhibit a" and exhibit "b" for raising money for these candidates. other organizations on the right are american family organization, move on, some we have heard of. we have the unions and the unions themselves have said our spending will not match the spending that is already been pledged on the right. but a lot of the other organizations that are organizingre also union funded. i think there is a more limited amount of money on the left then there is on the right. host: and in the "time" article it says that labor is set to put

about $150 million of their own money into the fall elections. other groups such as emily's list and the league of voters will kick in even more. you have seen groups like moveon.org form a 501(c)4, so they can do some of the same efforts that republicans do. guest: right they have 501(c)4 and american crossroads has a 527 and a 501(c)4. it is considered to be like a super pak. it is so designed for expenditures on individual candidates, but independent of their campaign. here they have one of each. it is kind of a collect them all the election cycle. they're being sent abroad in as

many ways as they need to to achieve their goals. host: take a call. palin on the democratic line, good morning. caller: my question is concerning the supreme court ruling and one man, 1 vote. as an individual i can vote and also as a member of a union i can vote. is that true? guest: i think the reference here is that corporations have been given the same first amendment rights as individuals. you has an individual can go vote for the candidates of your choice, but if you are a business owner, you can then use that vehicle to raise and spend money independently of the candidates in a very influential way. if you have the resources of.com view can muster -- if you have

the resources, you can muster hundreds of millions of dollars and make a huge impact. caller: money to buy votes? >> no, but essentially, that is what they are being accused of, or those who have been supporting the citizens unit decision -- rather, those against that decision have said this is allowing those with mor money to, in effect, buy more votes, influence for the candidate of their choice. money is outweighing the free speech of ordinary citizens. host: let's take a look at some of these issue advocacy ads that these groups are putting together. first the one against senate majority leader harry reid. >>, harry reid says no one can do more than he can. really, harry? >> only 26,000 people lost their

jobs today, which is really good. >> really, harry? no wonder nevada has the highest unemployment in the nation. deficits, obama care -- no one can do more. really, harry? for nevadans haven't you done enough? host: that was an ad put out there a group called ameri all to benefit their millionaire friends on wall street. do you think she would be on your side? >> [inaudible]

host: what type of groups. as -- what types of groups are these? guest: either one can learn days ads as long as they are not saying vote for or against. you can really achieve the same goals. the issue advertised is thinly veiled elections. everyone will understand these are directed at a for or against candidate. host: simply because they did not say the words against? guest: 8 goes beyond that. if it is reasonable to think this is directed at the candidates, then they are deemed to be -- express advocacy.

now with the supreme court rulings there really is -- the dates have been thrown wide open. these organizations can achieve much of the same goals. it will be not as much effort to police them because it is clear the courts have ruled in their favor and given them that latitude. host: to resell on the republican line. good morning. caller: i hope you give me just a minute. how come it was ok for the obama administration to use corporations to rein in millions of money monthly when he was running for elections and there was no push back from that? ge supporting obama for the green agenda. all these global warming donations coming in. how come that was ok?

but now that the republicans are running, all they push back is about corporations bringing in money? there was billions of dollars spent to get obama elected. host: hall was your group critical of the amount of spending during the 2008 cycle for democrats and republicans? how much money was spent on the candidates in the election? guest: and we do not actually take a position. there was a lot of criticism for the left rejecting the campaign finance money and pursuing hundreds of millions of dollars over and above what the mccain campaign could spend because he mccain did accept the pope -- that partial public financing. there was lot of concern about the three-quarters of a billion dollars spent by the obama campaign that was spent in the

last cycle and, in a way, that did undercut his credibility host: virginia beach, mark, independent line. caller: i am starting to get involved in politics and things like that i am finding it hard to comprehend because you're saying you cannot talk reveal private investments that you are getting of millions and millions of dollars, but again, you owe so much money and [unintelligible] and the federal government goes and punishes because they've made theironey probably and kept it to themselves.

where are you getting all of this money from? host: michael, we've got your point. let me show the viewers the headline in "usa today." ehab line is that mid debt -- midterm campaign war chests are crammed. guest: we were looking at a billion dollars election cycle ck in march and that was kind of a trajectory of spending in the elections of a last several cycles, not taking into account the fact that the recent decision could unleash a far more money in the election cycle. we were looking at a baseline spending, which would still be 30% above the previous midterm with the success by the candidates and these interest

groups. i think the press will be far higher. -- the costs will be far higher. i think it was $8.5 million for a winning senate seat. your average american does not have access to the kind of wealth. host: and you are on track for this cycle to cost 30% more than in 2008 and you can reasonably predict that the house and senate seats will go up 30%? guest: the senate on depends on which raises are up. we only have one third of the seat coming up in any election cycle. it would depend on where they have big media markets. of course, there is california, sort of think that would have a big impact.

host: next call from texas. caller: i am a 74-year-old man and this is the first time i have done any of this. who isn't watching the lobbying efforts toward our supreme court judges -- who is watching the lobbying efforts towd our supreme court justices? guest: there is lobbying at the federal level, but there is none reported for the supreme court. course -- host: they do not have to run for term. they are appointed for life. guest: i'm sure there are a advocates hoping to impress supreme court justices, but we do not have any way to track lobbying efforts for the supreme court.

host: stan diego, good morning. cut -- san diego, good morning. caller: i am a 62-year-old veteran and i'm very happy about these young people who are getting involved. to the 18-year-old who called earlier, i would say, keep at it, young fellow and remember, the bigger government gets, the fewer rights you have. thank you, c-span. host: but go on to lincoln, nebras. lincoln, neb., you're on the air. caller: guess, i have a question for -- i have a question for -- host: we are born to put you on hold so you can clear that up. -- going to put you on hold so

you can clear that up. remember to turn your tv down. washington d.c., good morning. caller: my concern is of of money -- new york, good morning. caller: my concern is aipac being treated as a human being. -- a pac being treated as a human being. how do we get corporations to not be treated as a human being. corporations do not have a finite life span expectancy. the cubans do. over the long term, they can save -- humans do. over the long term, they can say what they want and what can stop them? guest: i think that is a good

point. the balance that this decision gave individual americans and corporate entities is, i think, one of the most controveral and, for many, a very tubling decision. this is going toe the thought in legislative proposals to try to balance what th decision has done for years to come. unfortunately from our perspective, we cannot do what we do, researching the money behind politics with our? texting -- without accessing that information. an incredibly troubling aspect of this is the and our ability of these organizations to raise money in secret and spending it with our anyone really knowing who the interests are behind these ads and expenditures.

host: in georgia, cindy, independent line, good morning. caller: i have been curious about this question, and maybe that followed just asked a question. host: go ahead. the we can hear you. caller: i have gotten the impression that once the supreme court ruled on citizens united that it would be up to congress to refine that decision, to change it to be more equitable. what kind of progress -- is that tr? and are there any groupthat are supporting that effort in congress? because i think that is the only way we will be able to turn that off. guest: the caller is perhaps referencing the disclose act, which was legislation proposed by the democratic leadership. there were many facets to the legislation. there are still proponents

pushing for it, but nothing is ing to happen in time for these elections. i think the 2012 elections will be the next target to put in -- to create legislative change. and again, one of the major pieces of the legislation was to create disclosure of these outside interest groups, to know where the money was coming from. that was one aspect that the supreme court said we have got covered, we have got fixed, and we have great disclosure now. that is a combination of the work by the federal election commission. hundreds of millions of dollars may be pouring in and we have no idea where it is coming from. host: a tweet comes in -- guest: that is interesting because there is an inherent conflict between the members of

congress writing these laws and making them such that they are not benefiting the incumbents themselves, and creating an solidifying an incumbent's advantage. it is really of to was to hold barack -- to hold cowart incumbents accountable. -- to hold our incumbents accountable. host: ohio, go ahead. caller: is there a resource that we can take advantage of that would give as a nonpartisan comprehensive list? i ow they say that these donations are secret, but is there a place we can go to that would give as a comprehensive list of who is donating money? guest: that is what our organization is trying to do. we are at an opensecrets.org.

we are trying to track or the money is coming from and going to in the federal elections. you can see that all of the money goingnto the candidates' coffers and party committees, categorized by industry and interest group and standardized by organizations so that youan see who the major organizations are that are bankrolling campaigns. but we are also tracking independent expenditures. you can see wch organizations like crossroads gps, like others, are spending. in some cases, tens of millions of dollars, and all told, hundreds of millions of dollars. the kinds of money and that you can see on our side barack 527 -- on our website are 527 grou, and independent

organizations, these new super acs.p host: and those are 501(c)4? guest: no, they report to the commission instead of the irs. but they can raise unlimited funds from unregulated sources and spend it on behalf of the candidates. many of those ads will be very negative and coming in at the last minute we saw some of that kind of money flowing into the alaska senate race and the delaware senate race. very effective at dropping hundreds of thousands of dollars in just the last few days of the elections. host: a lot of the leadership on both the democratic and

republican side have leadership political action committees. they funnel the money to one place and they can sort of pull it out to separate entities? kalisha ps are kind of -- guest: right, the leadership pacs have money that is under their control and they use it in ways to free up -- it frees up more money that they can spend on their own election effort. but also, those who are supporting a more junior candidates who were struggling with their leadership pacs, they are pushing for a jump to higher office. host: if you go to the web site opensecrets.org, on the lower

bottom half of the website they have the campaign cost clock. you can see it taking away right now. host: let's go to a call from oklahoma. good morning. caller: my question is more of a persal question. what you think is a citizen and roll to make sure that -- what do you think is the citizen's role to make sure that they do not exceed the lead? guest: thank you for that question. we think it is an essential for people to get involved. unfortunately, there's a lot of discomfort with recent judicial decisions. is seen as secondary to all of this money coming in, but from our perspective, we see it as

our job to hold them accountable every level to the real constituents and not to the cash constituents instead. host: 8 week from a viewer's your -- -- a tweet from a view here. san francisco, go ahead. caller: people would call our founding fathers, even into the 19th century, and were very weak wary of corporations. i think part of that was having been under the thumb of british monopolies and hudson bay trading and all of that. they limited the corporate arters usually to about a 10- year life span and would only renew the charter is the corporation had, in the course of business, also contributed to

the general welfare. i think that is something that we may have been losing in the last 50 or so years of what has pretty much become corporate america. guest: the caller makes an excellent point. there is a growing sense of clout and power, certainly in washington, but all levels of political life. atorporations, of course. unions have also held sway and those that are spending are often at the top of the political contributors cycle after cycle. all told, however, corporations far exceed contributions to candidates and parties and unions do. there is a huge gap in resources for corporations verses unions. and i think the cloud of corporations -- clout of

corporations, to give the and this supreme court decision, is one of the concerns, particularly on the -- particularly the sreme court decisions is one of the concerns, particularly on the left in this election cycle host: another tweet from a viewer. national, judith, republican line. good morning. caller: i have a comment about the influence that unions have that necessarilyheir members do not agree with. i have several friends who are quite conservative and they find it extremely upsetting that they do not have a choice. in other words, the union's collective dues and then they support the liberal agendas and they have no say about it.

having the corporations, having the ability to do the same just kind of levels the playg field. although, i just heard the last comment about the corporation's will have more clout. that is my comments. guest: corp. -- the corporations have resources that far exceed the unions. of course, there is the argument about individuals being forced to give the contribution. we have often heard comments, ten anonymous, from people working at corporations that there was pressure for them to give or they were not going to get that rates or the bonus at the end of the year, or they were perhaps not going to keep their jobs. there is often the same pressure to give in a certain way. host: tony aen, you are on the

air with sheila krumholz. caller: this new law, doesn't that open it for foreign governments to give money into our election, somhi we have fought against? and anytime someone from another country has donated they have raised all that gain, the democrats. but now all of this money is going to come from corporations we do not have control over? guest: that was a concern that a democrat put forward in this last few months and thealler is absolutely right. because we cannot know where the money is coming from for these 501(c)3 tax-exempt organizations, we cannot know whether it is coming from domestic sources.

in our system of campaign finance, foreign corporations are unlimited. foreign entities can be influential, but they have to have operations in the united states. the money has to come from those u.s. plants and companies, the subsidiaries of foreign corporations. it is much more removed. but with the loophole currently in disclosure, we really cannot know whether money is coming from foreign entities and whether or not they may be foreign government controlled. host: are you seeing any like this that is happening, any hints of this leading up to november? guest: not recently, but we have in the past. there was a campaign finance scandal in the '90s were there were efforts and there were connections to a foreign government-backed organizions

to try to influence our elections through campaign donations. there was an investigation of that and a lot of serious concerns and allegations were, in fact, founded. i think there is a real need for us to close this loophole so we can see where the money is coming from because otherwise, we can on know whether it is domestic or foreign. host: folks like charlie cook has said -- he does not think we are going to see corporations flooding this campaign cycle. they're hoarding their money right now and not spending it on anything he does not think corporations are going to pay -- play that much of an influence in campaign 2010. those democrats that view the democratic majority or vice versa as a threat, they may be jumping in, but he does not see

e corporations as playing a big role. guest: i think he is referring to the idea that a major multinational corporations, maybe fortune 500 makacompanies, will not be spending a lot of money directly. did not want to risk offending their customers by taking a partisan side. on the other hand, where customers -- corporations have an interest in supporting one candidate vers another, particularly where ty can contribute anonymously, i think there is concern that there could be sizable sums of money directed at a particular candidate. furthermore, those who have fought against the citizens united decision have made the point that all it takes for a

corporate representative to go into aoffice of a member of congress could really dingell the threat of ending against that members should they not agree with their legislative agenda. i think the money is spent in directly at, giving money to those things, but also this threat of spending money against a candidate. host: david on the independent line. caller: can you hear me? host: we can. caller: i recently turned 40 and i have been listening to c-span for quite some time. i can't really remember how long and i love listening to it. thanks for that. but the types of reforms that we are talking about here, as far

as how it really is not reform as i would define reform because it turns are to be typical government increased of regulation and more complicated laws. things just get more complicated and nothing really changes. and the whole process around specifically donations just get bigger and bigger. from what i can tell, we really should be doing is removing money as much as we can from the process of who gets elected. host: that brings up public financing. can you talk about that? guest: we are not a reform group, so we do not support any particular platform for financing, but that is one of the key solutions put forward by many organizatns to remove

all the private money from the process and to show a wave that is -- to bring money into the system to support candidates with good ideas in a way that is corrupting and also in a way that is not just candidates with wealth. the recent court decision in citizens united in particular is a fundamental change. and really, this reverses a decade, if not a century of precedent in proceed our elections are funded and wage. -- waged. it is a good idea andany do

support public financing for this. from our perspective, we advocate to this -- to close that gap in disclosure. host: maryland on the republican line. caller: mrs. krumholz was talking about corporations an twisting the arms of their employees and the threat of being fired is not contributing to certain campaigns. i wonder she has more qualms with the unions for the fact that with the exception of the least 30% of union members are registered republicans, and yet, 90% or better of union money goes to t democratic party. do you have a problem with the fact that they are ting people's views without their consent and taking it to candidates they do not support? guest: the center for american

politics does not take a position on that, but i was referencing them both as equivalent concerned, that anyone should not be forced to give money to candidates they do not support. if that were leveled through our taxpayer dollars, people would be forced to find support. this is the debate both in our union pacs are funded, howow co >> tomorrow morning, the national business association president on the senate's consideration of the 2011

defense programs bill. discussion on president obama's infrastructure projects. william millar is our guest. after that, the chairman of the american academy of child psychiatry dr. michael houston on the growing number of children with developmental disorders. "washington journal" takes your calls live every morning starting at 7:00 a.m. eastern. us,f consumers don't trust they won't keep coming back. >> they communicators continues, a look at privacy and telecommunications policy tonight with anne toth. >> i underestimated how big the job is. i had not even been the minority leader, so i jumped to speaker

overnight, and from a minority party to leading a wave of 9 million additional votes is the biggest one party increase in history. >> newt gingrich on his tenure as house speaker and possible 2012 presidential bid. >> c-span's local content vehicles are traveling the country as we look at some of the most closely contested house races. ♪ ♪ ♪ >> we have two candidates for

the u.s. house. i want to ask them to introduce themselves. [inaudible] [applause] >> [inaudible] we don't have all the amenities of a large city like charlotte, but we have hospitality. >> congressman spratt is one of only two democrats from south carolina. the other is jim cliburn. this would be a huge pickup opportunity for republicans, which explains why they devoted so much attention to this race. he is one of nancy pelosi's keep people in this house and one of

the top democrats on the armed services committee. with his leadership he has been a high-profile congressmen. it would be a blow to the democrats to lose him. he has been in congress for 28 years. he is the longest serving congressman in south carolina, is chairmandf of the budget committee -- he is chairman of the budget committee. he has carved a reputation as the budget bureau -- budget guru in the house. he is now serving on president obama's deficit commission. congressman spratt one pretty handily in the last several elections. his most serious challenge came in 1994. he won by four points against a well-known businessman who later challenged him again two years

later. spratt won that race. he had a serious challenge in 2006 from a state rep. he has not had a serious challenger sense. >> we went to a launch in b ishopville. i spoke to 65 people at a republican club. i began by saying i did not think there were 65 republicans in lee county. someone said there are not. >> senator mulvaney who is a state senator decided to challenge him. he attended a town hall meeting on healthcare last summer and saw the level of concern people have about health care reform and decided that he needed to run for congress and challenge congressman scrap -- challenge

congressman spratt. he lives in the northern section of the district. he has an interesting background. he attended georgetown university and a law degree from the university of north carolina. he ran for the statehouse in 2006, worked there for two years and moved to the state senate. now he is involved in this run from congress. he said he wanted to keep it focused on three issues, one was health care reform, tcap and trade, and the stimulus package. he wanted to run a campaign based on his opposition to those initiatives. healthcare has emerged as the most high-profile issue. said thisuldulvaney

district did not want the health care reform. congressman spratt voted in favor of health-care reform and has had to defend his vote along the way. the fifth district stretches across 14 counties in the upper portion of south carolina and is divided into three regions. you have the charlotte suburbs and the northern part of the region, the midland region in the center and then they river area which is more agricultural. congressman spratt likes to call a three ring circus because you have to keep projects going in each of the districts in order to satisfy each. the fifth district has been hard hit by the economic downturn. they once relied on the textile

industry. textiles began fading away in the 1980's. now they are almost completely gone. many parts are still trying to make the transition. the economic downturn did not make that any easier. south carolina is one of the most conservative states. the fifth district is considered more moderate than the rest of south carolina, but it's still leans conservative. john spratt has been an anomaly for south carolina, a democrat and a conservative state. he is very conscious of budget, spending discipline thought. a lot of people in the district are upset about the health care reform and the bank bailouts, the stimulus package. and what they see as reckless

government spending. we covered several t party rallies outside his district office. we have not seen this level of engagement in quite awhile. that is what congressman spratt is having to contend with. >> c-span's local content vehicles are traveling the country visiting congressional districts as we look at some of the most closely contested house races. for more information on what the local content vehicles are up to , visit our web site at c- span.org. >> these c-span networks provide politics -- coverage of politics and american history. it is available to you on television, on-line and social media networks sites. find