cannot give me a seizure. when i went to my ophthalmologist, i took half a joint before i went into my appointment. i know it works. host: the pressure went down. the host: are you getting it legally or illegally in nebraska? caller: there is only one way in nebraska. that is illegally. what is to keep me from trying this? host: asa hutchinson? guest: i think we all want medicine for patients with problems. we usually work to the american medical association science to determine what is good medicine. i do not know if the lady tried marinol which has the thc

content of marijuana. it can be prescribed. in terms of smoking marijuana, we need to look to science. this debate is not about medical marijuana in california. it is about straightforward legalization of pot. we have to distinguish the debate between the other debate on medical marijuana. host: allen st. pierre, you have the last word. guest: citizens in california will be voting to legalize marijuana. if they do not do it now, they will do it by 2012. citizens in the united states will vote to legalize marijuana. host: asa hutchinson, former administrator of the dea, and allen st. pierre, director of the national organization for reform of marijuana laws. they and you both for being on

"washington journal." tomorrow, democratic strategist and republican strategist will be on the program to discuss the political issues regarding the environment facing democrats and republicans. we will also have paul barton to talk about his recent peace on congress's operating costs. bill adair will be here to examine a series of attack ads. that is the lineup for tomorrow. he will be able to see that tomorrow morning at 7:00 eastern. [captions copyright national cable satellite corp. 2010] [captioning performed by national captioning institute]

>> this morning, thomas glocer talks about globalization and corporate social responsibility. also, the bank of america ceo on mortgage foreclosures. later, a shell executive and former energy secretary talk about energy supply issues in the u.s. tonight, the 31st annual emmy award ceremony from lincoln center in new york. presenters include diane sawyer, dan rather, and katie couric. that is at 8:00 eastern here on c-span.

the supreme court has started its new term. you can learn more about the nation's highest court with the latest book. it has candid conversations with active and retired justices, reporters who cover the court, and attorneys to argue cases there, revealing unique insights about the court. it is available in hardcover and also as an e-book. thomas glocer talks about globalization and corporate social responsibility. he also talks about his own experiences leading a global corporations. this is about one hour.

but seriously mark whitaker. i want to welcome you to the speaker series. -- >> i am mark whitaker. i want to welcome you to the speaker series. thomas glocer is modestly described on a thomson reuters website as the ceo of the world's leading source of intelligence information for business professionals. it is of particular interest to me as someone in that media business to be talking to someone in the information business that is actually making $13 million a year. >> not personally, i might add. [laughter] >>, came up through the ranks of readers --tom came up through the ranks of reuters. he is a graduate of columbia. he has a law degree from yale.

tom is also a loggblogger. i spent the afternoon looking through his blog. wanted to ask some questions based on your recent posts. he has a recent blog on gogol in which he points out that he went back and reread it recently. the central figure goes on around buying up the rights to the dead serfs for tax collecting purposes. he compares this to the subprime schemes, creating an

early equivalent of an exotic instrument that was somewhat fraudulent. if what we saw in the latest blow in the subprime crisis and the economic crisis in the last few years is something you can go back and see in gogol and c in previous bubbles and see in history and literature, why did the financial press, consumer and professional analysts and writers not see it coming? what can be done in your business to make sure that the next time something like this is on the horizon we see it sooner? >> that is a great question. you have worked hard to connect it back to my blog, which i

write mostly to amuse myself and occasionally to make it easier for for people to get to know me in what is now a very large company. there did seem to be a parallel to me. i suppose the parallel is just team in nature has not changed russia toom 1830's the present, nor has the opportunity for regulatory arbitrage. that is what the character does by going on around and find -- buying serfs who have died which attended 50% of face value borrowing against. i thought that was an amazing

parallel to you ask a more serious question. that is how we all missed it or what we should have been writing about. after the fact, you can find people who were writing about it. whether you want to go back to grant's interest rate monitor for more recently rubini and soros been warning about it. bob rubin is at the council and was criticized somewhat after the fact. i always found him in the years leading up to the crisis to be very sane and sober on the risks building in the international system. why more was not done, i do not know. but i do think there were voices trying to be heard. >> going forward, all kinds of

things are being done on the policy and. for journalists and those in the information business and on the professional and, are there new tools and methods that need to be increased? >> there are always voices. pete peterson has been warning about the risks of the indebtedness of the u.s. consumer and economy at large for many years. now people are listening. the idea has been embraced and is beginning to be seen in actual policy debates between more financial stimulus versus the restraint we know we need to start paying it back. if one day, we have runaway inflation and wake up one day and the u.s. government debt has been downgraded, the question

will be whether anyone pointed it out. peterson and others did. the harder question is what it takes to do something about it. it is not just the economy. mike mcconnell has been talking about the threat we face as a society from cyber warfare. it is clear as day that there will be a serious attack. the question is only if we have to wait until that happens to have a response or can we wrap our brains and around the battle will be and is something before the fact. >> if you are reading gogol, you continue to have a broad range of interests. tell us about someone who has those kind of interests and

could have followed them in another direction in some of -- ends up in the job you have. tell us how reading more broadly continues to help in your job. >> some people are great athletes. i was never that gifted. i have always tried to make up for it in the decathlon. i certainly do not excelled there either. i am just naturally curious. fortunately, the things i am interested in like financial- services, technology, media, science at large, have been to a line very well with what thompson-reuters does as a mission. the fact that i used to be a practicing lawyer does not hurt when about 1/3 of our revenues come from the largest legal business in the world. >> in another blog, you talk

about going on vacation and turning off all of your devices for 14 days. really? >> [laughter] >> i cheat. my assistant is not turn off hers. i just enabled the data service on blackberry. people have to call me on the telephone, send me a fax, find me some other way. i do it mostly in small bits. i have kids who are to an end to a. there are certain times of the year when they deserve to come first. it is not that i do not get reached. i can remember when summer went one of our journalists was killed. it was an awful interruption, the worst kind of to be.

the difference for me during those two weeks is that there is not something vibrating or wringing every five minutes. i find that my attention span melanchthon's. -- i find my attention span wlenthens. >> what devices do you use? what devices to your kids use? what does that tell you about where your business is going, in terms of how information is delivered and does help it is delivered shape what is going to be delivered? >> i end up writing about this a lot. interests me. we are at an interesting transition point. you have made the transition from print to broadcast. t to broadcast. and so many people in this town and new york all over the world

seem incapable of separating the idea of from the printed newspaper. and that always seem to be a false identity. now, i believe there will continue to be great journalism and great journalists. in the time i've been at reuters, which has been 27 years now, we've come from 1500 to 3000 journalists. bloomberg sided journalists as well. we ma be among the sword is to only organizations that are adding while most institutions are going the other way. but i think it's because they can't abstract from what they do and imagine paper is just an output device. it has been a good output device for many years. it is lightweight, not that costly. it has a high contrast.

photographs reproduced well. i think our kids will look back in 10 years and laugh at how economically and environmentally wasteful is to only print once on a single plapiece of paper. there will be an evolution of what we think paper is. at one point, paper was animal skins, a cave walls, or papyrus. there will be an electronic form of paper that will preserve some benefits and hopefully take a song to a new form factor. >> my goal is to get at least five minutes into the interview without mentioning the words "business model." here we go. you have a business model based -- subscriptions because you are providing

specificity of information for professionals in real time. the consumer sector is struggling because it is so dependent on advertising. do you think the consumer sector will have to the war in the direction have gone on the end rely more on subscriptions? is there still an advertising base that will be viable in the long term? >> one of the reasons why we have such a good business is one of the hardest business problems of current times. that is how you get people to pay for content. we care a lot about news. i think the answer ultimately in a combination of advertising and subscription.

people are moving that way. for a very long time, there has been a huge cross subsidy. take "the new yorker" magazine. whatever the cover price is, when you consider the quality of the poetry, fiction, the real reporting in the magazine, compared to what it costs to buy, it is trivial. it has been supported by advertising for a very long time. it is hard to move value once people have been locked into it. it is hard to get them to pay something closer to what it is worth there are plenty of people in this town and audience who are probably paying $2,000 a

year for a subscription to newsletter -- for a newsletter that is particularly focused on what they do. the newsletter's traditionally have not been advertising supported. >> do you think that even for traditional newspapers and mainstream media, they will have to specialize more and find a way of selling subscriptions and advertising through specific channels within what they provide as opposed to the old model of aggregation? we do not need that because you can be your own an alligator -- agar gaidar -- aggretator these days. >> it depends on the value that people place on the news. if you ask a trader the value

of the number of oil wells on fire, that is a valuable piece of information they can trade or investment. they do. that is one reason why we have a large output for our journalists. we are developing in the other professional verticals in science and health care and legal a similar current awareness news component to ellis services. it is a much more difficult thing. this is probably a good thing about american society. we have not needed to be as worried about news, about foreign affairs. when you think about the average tolerance of americans for international news for the decreasing percentage it would take up of nbc news, the real

issue is we have a large country. we have traditionally not been subject to a lot of foreign threats. although some would decry help them down it is to only care about. sultan, you can look at the flip side. that is how wonderful it is to eight lived in a society that has not had to care deeply about some of the economics and for issues that the rest of the world has. i think that is changing. >> you have been quoted as saying that the the kind of newspapers is a big news for the agency business. as newspapers cannot covers a much of the world, they are turning to reuters, the seceded press, and other agencies. talk about the implications for

that on the quality of information we get. >> i do not think it is necessarily a wonderful societal development. i often say sick patient, the newspaper industry, has been relatively good for us. a dead patient is not good. what has happened, you see it all over the country, is that just as newspapers have had to figure out how to go on to the web, they have had to invest in 24-hour coverage rather than go to press that a particular deadline. there is an indication of how to staff a round-the-clock, who you rely on to get news and updates and around the clock. now that we all expect there should be video on what was

traditionally just a newspaper site, adding a new cost or talent to mention -- dimension. the final one is international news. there was a time when most major u.s. dailies have large international bureau structures. they have had too slowly or not so slowly close them. by doing so, they have become more reliant on agencies for foreign news and news on the 24- and not disclosed to bed with the print paper. we also supply video. that aspect has been good. it is not a runaway 20% growth business, but it has allowed our agency business to grow in

the single digits every year. >> your other blog is called "harry potter and the rule of law." you talk about the combination of globalization and digitization and conflicting regulation and around the world creating a real crisis. we have a set of rules of around the world for how we regulate the flow of information and privacy issues that are outdated. you talk about some of the possible solutions. >> the thought that gave rise to thought thatwin foug

just when an increasing amount of commerce is going electronic, is also the time when the world would appear to be shifting from a unilateral to a multilateral world. what is the regulatory implication of that? since the second world war, the u.s. has applied its own laws extra-territorial lely. tax laws are a good example. american citizens are taxed on their worldwide income wherever they live. that is very uncommon in the international set up. the u.s. has gotten used to the idea that its laws extend well beyond the physical boundaries of the country.

by and large, that was ok and unilateral world where others were not doing the same thing. increasingly they are. not just the you, but china has recently adopted an anti-trust regime and can be expected to adopt more rules that will be gin to bump into other rules out there. when you go back to how the law traditionally cope with that, there were established conflict of of principles. we have them among the 50 states. internationally, they typically grew out of things that moved like boats. airplanes were subject to international jurisdiction. they then canal flows far more

pervasively and seamlessly. -- data now flows far more pervasively and seamlessly. you now have far more facts on the ground all over the place disbursed by electronic means. we have not yet developed a significant set of more sophisticated tools or organizations. how do you cope with it? the e.u. was dealing with bringing together fully sovereign states that have now given up some sovereignty. it has probably tackled more of it, ideas like passporting. if my product has been approved in the u.k., it does not have to be approved separately in germany. as a matter of right, i can sell

and distribute it there. organizations like the wto attempt to create some form of mutual recognition or harmony. all i was pointing out in this presentation was that we need to do this in a hurry. we're going to find far more clashes. it will accelerate the pace as opposed to the last 50 years. >> even if he could get the big players to the table and, the big corporations that have a stake in this, and get them to agree, in the realm of information they do not necessarily control how the information is disseminated now with social media. how does that complicate the challenge? >> it does in areas like libel law in whatever the relevant regime of freedom of expression is and what does it pain into --

bang into in other countries. a was not trying to solve the complete the issue. i was trying to get a dialogue going on the mechanisms. one is a form of super-national walaw. there are internationally binding treaties. people can agree to a regime that everyone adopts. it takes a long time. it is cumbersome and hard to get people to agree. the second is through one or another organization that seeks to align. it may be the wto or the g-20 or g-eight. -- g-8. the u.n. does not seem capable now of playing that role.

there are other things like passporting. there are ways of tackling it. it has to be a high enough priority at the state level to get something done. >> when you traveled around the world and deal with some of the new players in this, the chinese, indians, and so forth, what is your impression? how hopeful -- helpful do you think they are prepared to be? >> did various -- it varies topic by topic. the issue of the day or week is the currency war breaking out, as claimed last week by the brazilian minister.

what pressure can be put upon the chinese to liberalize the exchange rate policy? my somewhat off-the-cuff reaction to that 1 ounce when i thought the chinese would liberalize the regime, my answer has always been six months after the u.s. stops asking them to do it. [laughter] the deeper issue is i do not think that currency realignment alone is going to do the trick. it is not going to suddenly, magically create a generation of consumers in china. that is really what is needed. until those consumers are not in rationally saving money, until there is a social safety net, the means of having an assured social security retirement savings and some form of medical

savings, it is not irrational to save a lot. arguably, they are saving even more than they would need to because of the risk. it would be very helpful if we could have currency realignment. we also need to help the chinese sort out these larger societal programs. otherwise, we will not get the huge consumption we expect of whatever we wish to export to them. e the issue of clarity and the fact that business, despite the fact that they of healthy balance sheets because of the bailout, they are sitting on the cash and not spending it. they say they are not spending it because of the uncertainty of

their about tax law and the health care plan. you have professionals looking at those areas of the time. from your perspective, do you think those areas are still uncertain, but what congress has produced is too complicated for business to figure out and planned on going forward? >> i think that is an aspect of that. it is an incredibly difficult environment to make long-range investment plans in. we continue to invest in large new product platforms. we were already started on the endeavors and we knew that whether the markets turned of not, we needed to invest in

the future of the company. despite the fact that we merged these to the companies and eliminate some jobs, the overall combined headcount has gone up substantially over the last couple of years as a result. a deeper issue that people do not talk about is that over the last 10 years, the growth in businesses has come from two sources. one is leverage, that is obviously added to the riskiness of the economy with the disastrous effects we have seen. it has been a productivity gain. more of the success of u.s. business has been based on the point technology -- deploying technology to creating this sort of jobless growth. andy grove road and interesting

piece over the summer. -- wrote an interesting piece of the summer. he debunked the idea that the answer to all of our problems was in the dracula's start of confinement -- in the miraculous startup environment. he said the problem is not that we do not start lots of companies or that the first 100 employees or not in menlo park, he said is this feeling. where are the new jobs being created? they are american companies but scaling up on a global basis. that is the overriding challenge of what we want to make in this country. how do we create a society that is not so bifurcated between elite that gains

from productivity and others who say their lives have not gotten better in the last 20 years? >> i want to ask you a question about your foundation. i gather is focused on training. that is great from the viewpoint of social responsibility. do you worry that you are training the people who will come and compete with you and cause you trouble? in this day and age, if you do not have to be in the -- you do not have to state that one company. you can go out and start the next facebook. >> we do not worry. if that happens, it happens. the thompson-reuters foundation it is dedicated to doing three things. one is journalist safety and training. two is promotion of the rule of

law of around the world. we think it is a very big thing generally. selfishly, it also benefits the company which provides more legal research materials and systems that anyone else. the third is the disaster relief. in our foundation, we try not to just throw money at issues, but use the same skills that we have in the company to amplify and accelerate the efforts of others. we run a service called alertnet. think of it as an electronic clearing house for ngo's and others responding to is a disaster -- responding to a disaster. if you are a pharmaceutical company willing to donate antibiotics to pakistan after disaster, how do you find out who has an airplane going in?

who has trucks to the area? .t is an electronic marketplace rather than being destined for profit, it links up humanitarian efforts. it does cost some money to run it and maintain it. we think doing that, we can do more than just writing a check. we will do that as well, but this means more to our own people. >> we will do a piece on nbc the next time there is a big natural disaster. questions, stand up and identify yourself. i think you can figure out that this is on the record with all of the cameras are around. >> i have two questions. roger parkinson, i have two questions that are related. with the purchase or merger of

thompson-reuters, is there something significantly different as a company than just an amalgamation of the parts and elimination of some staff? what is your strategy for competing successfully against bloomberg? do you have any competitive advantage against them? >> i will start with the second one. customers want choice, whether it is in financial or legal markets, what we do in health care or science. no customer wants to be reliant upon the sole source. innovation for the whole marketplace benefits from having tough competition. there is no question in my mind that the market division at thompson-reuters is a better

company and competitor today than it would have otherwise been without the admirable in entry by bloomberg -- inj bloomberg. we should be thankful to have a strong competitor. i do not think british airways would be anywhere as the carrier today as they are now thanks to virgin. i have always found it miraculous that on asian routes, the american airlines can manage to do decent service because the standard of competition is so great. it is a reality and a good thing. we have a bunch of differentiation between us that i will not for everyone else with. on the first question, the point i would trot out -- bring out by

what was clearly an acquisition by thompson of reuters is that a lot of people get in trouble in business by using new amount -- mealy mouthed words that make them feel better. it is great at the time. he makes everyone feel a little bit better. the trouble is that you cannot run anything that way. the military could not run a campaign that way. people should not run companies like that either. a disappointed a lot of folks on the traditional reuters side by making it clear that it was an acquisition of researchers -- reuters followed by a management succession.

that has made things a bit easier culturally. there has been a quick coming together of the two, to the point where we do not think any more of what side people came from. the cultures were more similar than different. >> is there a different kind of strategy or view of the world? >> i would say there is a broadening of the strategy. in some ways, it has become clearer and samplers. reuters and 1.5 businesses, financial businesses and a wholesale media agency. we now supply information and software to professionals wherever they needed to do their jobs and are willing to pay for it. that is in law, tax and accounting, science and health

care, energy, media as well. that means there is a common thread that runs through the business. when we talk about intelligent information, it is not to eric and i say that we're the only people who write anything that is smart. we are actually trying to give a d version of 3- this. information has to be intelligent when it is consumed by machines. it comes with a data model. it is says it is destined for this size were that size. i can tell what size the display is and reformat it myself.

that is the sense in which we call ourselves and intelligent information company. >> wait for the microphone. >> i am a correspondent for reuters. i am also the head of the newspaper guild unit at preachers -- reuters. we're at the speed with the company. it has been acrimonious. -- we are in a dispute with a company that has been acrimonious. we share pride in what we produce in the journalism division. but we are troubled by how you might sq corporate social responsibility with the current company policy of cutting effective compensation to more than 400 journalists in this

country coming in which you have so much pride. >> i do not want to drag everyone else here into it. i do think i should respond directly. this is what i really believe. his 400 employees out of 55,000 and around the world. -- it is 400 employees out of 55,000 around the world. in the end, it comes down to money. i have to be careful what i say. there are issues as to what i can say that maybe going on at this moment or in the last 48 hours that i am aware of. my position is whether you are in the guild or not, he should have the same retirement plan and the same health benefits as

anyone else. there has been flexibility shown by the company on monday issues. there will be no flexibility on having people have a different plan or better benefits. i realize that other people are coming from other regimes where they have had better retirement plans, better health plans, etc. that was also true of a lot of the general population. when we put through changes in plans as a result of the merger. i do not want to create a wedge between the person next door having these benefits and the next person does not. the nexus is money. >> i am from george washington university. in washington, we have the federal register to see what

opportunities there are four agencies. we do not have anything like that of the international level. international organizations on their own web sites are increasingly asking for comments and reports. the world trade organization has even done that recently. there is no way that an ngo or business can scan all organizations around the world and see the opportunities and where they can make comments. is that a product that you might be able to do? >> i have never thought of it. i bet there are people in the company who have. i can think there would be a demand for it, much in the way that we publish a washington daybook. there might actually be in

demand. we will take a look. great idea. great idea. >> i'm a correspondent at reuters as well. i have a nonguild question, although i second with debbie said. you talked about why we in the financial press didn't write it. you said it was never us. that's some of the system. i was rading some stuff with charles ferguson. his basic point is he's very shocked that nobody has been prosecuted criminally. he thinks that people should have. i'm wondering you agree with them, even if some of them maybe our clients? >> well, you know, look, we wouldn't -- first of all, nobody particularly cares about what my personal opinion is one way or the other. people break the law. they should be prosecuted right? that's a national government position. that's noa personal or a company one. i think the problem is with this particular crisis, it's very

difficult to prove, you know, let's take an example like the fall of lehman brthers. lots of efforts after the fact. people looking at issues of corporate governance,nd in particular remuneration have said we have to change all of the rem plans so that the people at the head of banks take more of their compensation in stock. that they are required to hold that stock. the irony is the two institutions on wall street had the highest employee stock retention were bear stearns and lehman brothers and dick fold to make many other mistakes, we went down with $1 billion of his own stock. i don't think he intentionally tried to create that.

now every prosecutor worth his salt federal and t the state level has probably trying for the last couple of years to bring that suit. and so far, you know, no one has it. doesn't mean they won't. i don't have an opinion one way or the other. i just think it's a vry hard -- it's a very hard sort of example to find who is the culprit and what did they do? >> hi, u.s. department of commerce and former journalist. having lived through the acquisition of time warner, what'sour thoughts about the future of the media industry and whether you see more mergers, perhaps with inteet companies or maybe media companies splitting up. maybe, mark, you can comment a little bit about that being an

nbc universal? >> i think the distinction of med versus internet company was a, you know, it was captured by that wonderful image of steve case wearing a tie and jerry levin not. that was the moment of time in where it matters. i'd go visit our banking clients. people would give me a business card that said i'm head of internet banking, or i'm head of the ecommerce group. i always wondered, you know, 100 years ago did someone at jpmorgan have a card that said, hi, i'm head of banking using electric, and i'm using indoor plumbing. it's becoming an evasive part of the infrastructure that we rely on. i think there will continue to be mergers in partor acquisitions because it's often easier for all of the reasons that have been written so much

about to innovate outside of big companies. i actually think there will be continue to be a media business and that actually there will be journalism asell. i'm not pessimistic about the future of journalism. i think it bears some real interesting and difficult issues about how will societies pay for the journalism they feel is needed to maintain the sort of level of an informed electorate. that's a real tough set of issues. we tackled more on the foundation side than on the day-to-day business side. i don't have a magic potion for tha >> the only thing that i would say is i think there is going to be increasingly a distction from the world of journalism and information in general. the people on an individual basis or small group basis can go out and get information

that's ready available and the kind of investment it takes to get a deeper level of information or to do certain technological things like we can do in television and covering live events. for those companies to stay strong enough, i think there is going to have to be probably a little bit more consolidation. you are going to have fewer and fewer media players playing in the middle, being able to make those kinds of investments. i think you see that already with the shake out in the newspaper business. >> hi, patrick, former reuters employees, now doing startups in the d.c. area, what's the role of the human loop and actual consumption of data versus many of the acquisitionin the last couple of years about the machine-generated news and data? do you think there's a growing

shrink role of human-based interaction and human-based analytics? >> i haven't -- >> this sounded like an teresting question. could you translate for the rest of us? >> there has been a bunch of experiments. we do some as well. can you generate news stories? the easiest things to do is company issues the press release; right? you have some sort of scaping technology that sucks it in, kicks it in your format, and back out as a story. it's also worth a lot more than reproducing the story itself. with a certain lev of story, you can actually begin to add some value by, for instance, putting in the relevant quote and linking it to a graph or former stories or there's an associated photo. there's some things that you can

do electricically -- >> sort of lgorithm; right? >> right. we provide a product to the finance service industries called machine readable news. there are traders who will take in a news feed from us, which has a set of at go -- algorithms and the easiest way to think of it is if there's a given story and it says surprise, positive, out perform, you can assign a rating to the more positive subtract out the negatives and come up with a mathematical model that somebody that was written by a human being never thinking it would be parsed by a company. traders will take any dge that they can. people are doing things, not just with our content.

back to the question. i think human editors, in my perfect world, i have have a single editor who did not nothing other than write the daily m. and would not only do some of the, you know, searching to find everything that i say i'm interested in, but would have that marvelously huan effect. i still haven't seen a computer do which is the serendipity of adding the programming in, you would never ask an agent to look for this. i'm going to surprise you. when you see it, you'll want to read that. that's a very human quality. maybe one day when tests have been passed by the most sophistited algorithms, you can simulate sir. -- serendipit.

iwon't be alive. [laughter] >> they have placed internet and looking at circumventing technologies and access to information overseas andchina and elsewhere. is there something that particularly the department is missing in this that we should be looking more carefully on? you had talked in particular about the importance of rule of law for the reuters foundation. should we be looking t something else? >> well, it just so happens i've just come from a meeting off of the record with the legal advisers who used to be the deal of yale law school. >> nothing is off of the record. >> i won't say how that meeting went. >> oh, okay. >> but you have one the deepest thinkers anywhere on these issues. i think it's laudable that the u.s. government thinks and cares

about those issues. i think technology and the twitter example in iran is one, but not the only. chinese has gotten very sophisticated about the use of proxy servers and the ability to get information from, you know, around the grate fire wall in china. you know, there will be times when people -- governments can attempt to choke off access to information and they probably can be successful. the north koreans do a pretty good job with teir own people. but not orever. the interesting we found, you get a different perspective when you run a 2-yeaold company than maybe a start up. if you go around the world and go to the countries that have had the most repression and then find freedom, those tend to be the ones who respect press

freedom more than anywhere else. the reuters brand is stronger in south africa, stronger in eastern europe, than perhaps any place else. because they actually value and cherish what that means. >> >> we are living in an age of internet and cable television when content is highly fragmented. there are a lot of choices on where to get content. can you talk about building a brand? can you see a day when brand does not matter in the content simply rises to the top? ? >> the answer is contained in your question. certainly now, brand is more important than ever. brand is not always the bad thing. it is not just the evil people

on madison avenue that concocted a strategy to buy things. brand also comes from a long reputation for doing the right things. that reputation can also be lost quite easily. typically, institutions like ours go to considerable lengths in journalism training, hiring really good people like some of the people here today and in creating an environment in which principles apply. . . hat you can and can't do in editing and transmitting a photo. and that's important. we have had episodes around the world where those standards have been violated. and those are threats to our brand. and if we did nothing about them, at some point, we would lose the trust that's in the brand. at the moment, you're right.

with the ability to find a multiple of sources everywhere, yeah, you can use technology to search around the particular theme. but brand is still a very important beacon, i think. and every more so today. >> you have been waiting very patiently. sure. >> this has been a fascinating session for me. i want to ask you about andy gross' article. at the end of the article, he said some things that caught my attention. one was if you look at what's going on in the past -- if you look at what's going on in the past, free market clearly out did the planned ecoomy. >> uh-huh. >> he went on to say neither of them are serving us well today. perhaps we need something moderate in between, and then finally said what he thinks we need is a jobs economy.

when we have somewhere between 15 and 30 million people, depending on who you listen to, and it's -- the numbers keep going on, what is your view of these ideas of rethinking some of these sort of hard and fast rules about how things ought to be done. my own perception is that in the 21st century all of the -- the rules that we were used whether it was in economics or teaching political science or medical, the way we were doing medical stuff or even government rules and processes. they don't seem to work today. how do we get into a 21st century set ofprocesses? >> well, i think, you know, this is often coming up in the debate of which system seems to work better today, china or the u.s.? and, you know, we have marveled at the speed in which they were

able to create and apply stimulus pending to the economy, how they were able to spend it, they seems to have billions and billions of shovel-ready projects which happened to align with things like new infrastructure, genomic research, et cetera. i think there's an interesting debate that goes well beyond the roll of thompson reuters on have we reached a point where this is such a complete dissemination of information which when coupled with the tw-year information cycle puts us as the relative disadvantage in terms of essentially doing policy that lasts longer than an election cycle? and the chinese famously think in long periods of time. they are able to -- looks what's going on right now.

there will come in point in three years, five years where we will wake up and realize most of what's worth buying in africa have been bought while we have been busy prosecuting a couple of wars. that's not that's not an important thing to do from where we stand today. that's what somebody who is thinking 100 years down the road can do versus somebody that's thinking what do the polls looked like at the midterm elections? with all of those inperfections and well as it appears the chinese system has worked today, it produced the cultural revolution and great disasters. we should look at which system on average over the 1,000 year-period delivers the results for its people. i think we are going through a difficult time of the system to do it. b i wouldn't sort of rewrite

the play book right now. : >> coming up, bank of america c.e.o. on home morning foreclosures. then a energy supply issues in the u.s. following that, a discussion on the 2010 through season.

tonight, the 31st annual news and documenty emmy award ceremony. presenters this year include diane saw yer, dan rather, katie couric and lester holet. at 8:00 on c-span. >> what are people watching? yeah might be surprised. whether it's the most viewed events today, the past week or the past month, click on most watched. every program since 1987. watch what you want when you want. >> bank of america's c.e.o. said the company has found no problems with its home morning foreclosure process. these comments came shortly after the company announced it would freeze all u.s. foreclosures while it conducts a review. mr. moinhan also talked about the state of the global economy

and the recently passed dodd-frank bill. this is about an hour. -frank fis bill. om the national press club, this is an hour. >> i'm a reporter with the bloomberg news and preside of the national press club. we are the leads to the crew leader of professional business and committed to the future through our programming and by fostering the free press worldwide. for more information about press club, please visit our web site at www.press.org. to donate to our problems, please visit www.press.org/library. on behalf of our members worldwide i would like to welcome our speaker and the attendees of today's events which include guest of the speaker as well as working journalists. i would also like to welcome the c-span an public radio audiences. after the speech concludes i will ask as many audience questions as time permits. i would now like to introduce head table guests.

from your right, vick seaseted of the alliance group for morgan stanley. lorain wallert for bloomberg news. stephanie due, correspondent for nightly business report. karen rotchek as is the editor for kepplinger at terse. steve beckner senior federal reserve correspondent for market news international. william cooper, a mid-atlantic president and csr executive for bank of america and a guest of our speaker. and ruth snyder, associate editor for kiplinger washington editors and chair of the national press club's speakers' committee. skipping the speaker just for the moment, mark sibel, managing editor for online for the mcclatchy nspapers washington bureau. donna borak, said reporter for the washington bureau of american banker. itaoro irishi 40 nikay this

pittard. reubin mother, regulatory correspondent for the deal reporter of the financial times. and finally, david hodas, free-lance writer reporter and editor of business and financial news. [applause] two years ago the u.s. financial industry stood on the brink of collapse. the subprime mortgages crisis had just brought down lehman brothers in the largest bankruptcy in history. a record held all of 11days before washington mutual spassed it. president george w. bush signed legislation to create the troubled asset relief program, better known as t.a.r.p., which allow the federal government to take stakes in the financial sector with the aim of stabilizing it. such government intervention, even arguably generous terms was regarded as heralding, quote, the end of wall street as we

know it. bno less than authority the "wall street journal." but in many ways, t banking sector and wall street are continuing along today. bank of america provides the case in point. despite all of the trial of the past two years it has a balance shee of $2 trillion. even with pls to shed $150 billion in assets that still leaves it larger than the united kingdom. on october 1st, it became the third major lender in two weeks to freeze foreclosure cases which remains as a reminder the mortgage crisis continues to exact a painful toll on many individuals. our speaker todatook the bank of america in january after previously serving as the head of the corporate investment bank as the chief counsel and as the head of its consumer bank. he is here today to discuss the outlook for the u.s. and global financial markets. a recent regulatory reforms in the u.s. and abroad and the role of financial services firms and promoting economic recovery.

please welcome to the national press club the she fix ticket officer andpresident of bank of amica, mr. brian moynihan. [applause] >> thank you for the introduction. lcome, everyone. it's great to be here in washington. i welcome the ever committee to spend a few minutes today talking to you and those of u.s. journalists especially about bankamerica's financial industry and where we sta and where we think it goes. before i do that i want to recognize bill cooper and other teammates from bank of america who pport the millions of clients we have in the middle and area in washington, d.c. in paicular. we are in our industry at the tail end of a very volatile time since the depression. setting a path forward for stability for the industry come

for our country, in fact the world continues to occupy the energy of private sector, banks like us, policy makers and regulators. and as you know many are gathered in washington for the imf and the various meetings this week. but we have been a great deal of progress the last couple of years being in this setting reminds me of that. two years ago i was in washington for the imf and was here in 2008. it also was a long weekend as all of you know. the and fireman was very different. at these meetings i take the occasion to meet with many foreign financial institutions that have come for the meeings. as i sat in the meetings with the ceo of a foreign financial institution and myself we would be getting interrupted fom time to time, people pull out of meetings which is an unusual case for a ceo meeting and there were called by policymakers and central bankers in the country trying to deal with the issues the industry faced to the end on monday of that long week two years ago the t.a.r.p.

investments were made in large banks. i had gone home and i remember that because on like this year the red sox were in the playoffs and i was a playoff game and the board meeting occurred during that. we continue to seek ways to help keep the financial system going forward. we were seeking ways of the time to keep the financial system and forward. we are seeking ways to stop deval orval liquidity and provide solid footing for the economy that in the fall 2008 in a crisis. but it does today is the crisis is mostly behind, the broad economy is recovered from the recent debt. but there is more important work ahead if we are going to create conditions that will support long-term stability and reasonable growth. today i'm going to talk about a number of topics including the economic climate we face as a country, the financial regulatory reform just passed a few short weeks ago, the important role of financial institutions play in the united states and the global economy

is. but me start by providing a quick review of the conditions in our industry as well as by u.s. economy. during the recession that occurred technically from the fall of 2007 to june of 2009 our economy in the united states lost 7.3 million jobs, a staggering amount. we experienced a 4.1% decline in economic output. the net worth of u.s. households dropped by 21% in part due to the housing decline. was the longest period of recession since the great depression. given the intensity of the receion there is good news to report today. first hour experts like dick mccormick to study our economy and are not wcome believe that we remain in a recovery in the the recovery will continue as we move through 2010 and 2011. for 2010, it is expected to grow 4.6% from in the u.s. the second

half experts would say we are going to grow 1.5%. for 2011, the worldwide economy will grow almost 4%. and while the growth will not be spread as swiftly as those as us in the united states or europe me like with faster growth in asia and slower in those countries, the messages this, we still continue to grow. there are signs of life in the u.s. economy every day. jobs seem to stabilize today back that up. manufacturing continues to expand. the final demand for the manufacturers and coanies of the service remains relatively weak. we see spending by consumers continuing to grow. the money they spend on plastic with a debit or credit card is up 7% from last year. our client companies, companies all clients, they've weathered the storm well and have built cash a almost unprecedented levels. however as we look for what we faceeadwind to drive this economy here in the united

states and around the world for would be read in the u.s. we have a high unemploymentate hovering around 936% announced today. the net on a plan that holds back the growth in the economy from consumer spending to the robust housing market. as i visit clients around the country i ask them what their prospectus with the thing to swing to happen next year, all the things you'd expect i would ask them, their opportunities are as a person decided to leave to serve those clients, and they keep talking about one issue that holds them back and that is the issue of uncertainty. they are not confident in the landscape ahead or in the economy or the regulatory environment they face in their industry and importantly not confident demand for the products sold in the mix better employment report be stubborn. second thing we face in a headwind is the deleveraging de wt on for both consumers and companies. consumers have made it through the last couple years are continuing to leverage which is not a bd thing.

companies likewise and tremendous amounts of cash and started a paid down debt and the middle market companies are borrowing rates are at all-time lows at the credit rates to support their busines the continue to hold it there because the uncertain future and one of the have plenty of cash they don't see the opportunity to put it to work and we need to push it forward. another challenge for headwind is the home ownership issue. we've modified 700,000 mortgages at bank of america in the last couple of years. we are working for many more troubled mortgage loans and this is a very, very difficult process for the consumer is going through. we are dealing at the best of our ability. we built 25,000 people to work with consumers to help through the process. from 5,002 years ago. it's difficult for the homeowner, it's difficult for as a servicer and colleagues industry to handle this well. it's unprecedented in its scope in the country's history. the next head wind is a

government debt. u.. government debt held by the public is increased from 40% of gdp to 60%. the rise reflecting the recent recession in the financial crisis reaching levels not seen since world war ii. what this does is constraints flexibility going forward and how we can approach the economy through spending or other tax cuts in constrains our options. , household side even as the debt service as a percentage of income has declined about 12.5% from a high of 14% it's still ly halfway back to the levels it would have been in the robust economic cycles in the 80s or 90s. one thing i get asked about is does the united states need a higher savings rate. we need americans long term to save the way that people do in other countries for example japan or other countries around the world. the point is we just don't need it right now and that's one of the difficulties, we need people to keep spending to keep the economy growi but we need to keep saving and that is a

challenge we face. to summarize its growing in the u.s. and the run of the world and that's good news. businesses have recovered quickly taking advantage of growth around the world and growth in the u.s.. consumers continue to move ahead making it through a difficult time for many of them. but in the and it is going to be long and slow recovery but it is going on and continues to go forward. with that on the economy let's switch to talk about financial reform and what has been passed in our view and what will stop things from occurring in the future. it's without a doubt the u.s. financial service system needed a change in the process has been under way. institutions like our institutions and other private-sector institutions changed how they operated tremendously the last couple of years. and policy makers here and around the world working on the reforms to help push the change for work. the dodd-frank act pains and number of provisions that address some of the causes of the financial crisis. we are in a period of

unprecedented rule making in our history and the implementation will take a matt of days, weeks, months and even years. ere's much work ahead to get the right and it's a lot of hard work going on, but the recovery agencies are responsible for it. those reforms, when implemented, should contribute to the future stability in the financial-services industry. the one thing i would tell you is there is no substitute for good manageme. it's a responsibility to run for our customers and shareholders and we will never give up that response will be under any red tory reform of theregulatory reform can purchase through to the right place and in addition to the dodd-frank ball seóul iii for most of this banking are familiar with the outside banking might not be familiar with have been subject of great discussion and will be the suect of great discussion here in washington. the standards agreed to in principle by the old wide regulatory framework it will be proved the g20 in november in seoul have been set.

the principal change for you to think about if you're new in the industry is the tier one common equity levels required industry hagone from 4.5% plus a buffer of 2.5% of total of7%. now without getting it all the ways you have to calculate that the simple thing as institutions will have twice as much capital as they did a couple of years ago when it is fully implemented. other good news for the financial institutions like bank of america is most of raised substantial capital the last couple of years. and we can compl with rules like managing balance sheets and earnings carefully the next couple of years. given the experience i had working for an institution that entered the financial crisis and it stretches the capitol to require some companies and was depeent upon the econmy staying in place to restore that capital we are a strong supporter and robust capital standards. i believe the7% level that cannot frm the basel framework is what we need to rebuild

confidence of the same time not to stifle growth. other areas of reform should help avoid a recurrence of the core issues and economic crisis. for example, the new consumer bureau to prevent the sub-par lynndie if it's done right. the risk oversight council of all the regulators meeting together not to help translate risk throughout the financial sector whether they see one and transfer to other places to avoid repeating mistakes in the company's. the provions regarding derivatives exchanges for derivatives provide a great transparency, would counter the risk and preserve the ability for us to help our climate at the same time. it is a lot of work to help sure we get this right. so we have the economy, regulary reform and the last point i would like to talk about its large financial institutions we needed regulatory reform, but the question i often get asked is we need to rethink the kind of financial institutions we want to have or have in our system.

there's a lot of commentary in the the question with a large universal banks are good for the economy. our answer to that is obviously yes there is a move afoot for a while to put back the standards of glass-stegall and other laws to try to break up interconnected financial institutions. but there is great reasons why we have banks at our sites to support an economy of our size. we first have to support companies with large international regions. those are companies in the united states that do business around the world. the need of the global reach to help them do that. the ceo f one of the major technology firms it took to the other day to 70% of business outside the united states code gm, chrysler, you name the company all companies of that size our global today. they could significant business overseas and help support our economy in the u.s. in that

business. the la are adequate capital markets as maturas always in the united states an provide the capitol they need to go and prosper. the serbs achieve the growth goals and advantages to the u.s. economy. and helps develop capital markets around those countries and help support growth in those countries for them to consume the products also. what's different is the economy has changed dramatically as those large companies of your buddieis yes we would agree they are global. t middle-market companies around the world are now global. i'm talking about companies with tens of thousands or 1,000 employees that have five injured million or 200 million or a billion in revenue, the core companies we saw our duty to preserve their peoples of the franchise. the cell to the global economy and the supply chain. a source the resources they need to produce goods from the global economy. and bigger just as demanding as the brand name companies to seice them around the world. and in addition, our u.s. and

worldwide markets require that large pools of capil be available to help those companies, all the companies at stake. remember one of the roles we play as an intermediary. bringing togetr pools of capital for investor clients from those of our issue our clients. some couldn't support it better equity like we did for ourselves in 2009 to raise capital. and in fact ouldn't support ten simultaneous 2 billion-dollar equities we had the pipeline as we speak right now to keep the economy growing in the united states and around the world many to be there for the client companies with large pools of capital and large pools of capital are held by the large institutions. to have the large financial institutions in this country will look at the countries that don't have them and see what they say as i circled the world i see the central bankers say help us develop the capital markets in the states. we don't have the pools of capital, helpless figured out how to do it.

the third point i will lead to a large institutions is primary source credit to consumers of small business. we know from a considerable experience in the last 30 years our ability to provide credit as broad a crowd pricing customers. it allows us to continue to lend in markets this year to 10% more for small and medium-size business enterprise than they did last year. $90 billion plus for september. the large institutions on the fourth point also driving innovation spark a greater convennce across the financial system. these include online, banking or bill pay, when our to payments made online banking read for the institution today. the 4 million customers we support, the fact it can deposit need to get picture wit your phone. to provide an overdraft protection to avoid the fees. for a predicti to make sure to purchase goods to secure you don't have to pay for those goods if you don't get them.

the savings to help you save that day to day. and that is on the consumer side. innovation got a very bad name in this crisis things to the priferation of complex financial problems that created uncertainty in the markets. but responsible customer centric innovation and is on the consumer side or commercial side undertaking firms by resources confirms of resources people in the money to do it right. it can unleash important efficiencies and effectiveness and flexibility. fourth large financial institutions meeting continuously improve infrastructure as a backbone to the system. the infrastructure to gransta financial pipes every day is really something to marvil at. it enables the capitol flow and capital markets and enables you to cash a check on the street and everything in between. in the size and complexity of the investor to leche financial institutions are on a quick qualified to lead not obtain would improve it. so what is a simple but symbol of that infrastructure? every one of you has a piece of

plastic and that is ubiquitous. you can go anywhere and spend it. it takes a lot of infrastructure behind. there is the piece of plastic to a to carry as much cash, we've greate transparency to how money moves, tax collections and all those things and thy are supported by large financial as tensions because it is in our interest quite frankly to drive down he cost. six, large finanal institutions play a role in maintaining the global leadership. our industry is the most competitive in the world. it has long-term success, it's been efficient aubuchon capital and field economic growth in this country for many decades and itontinues to be a worldwide leader has exceeded around the world as a spoke about earlier. while lenders and people sometimes the request of the value of large institutions, in my view is misplaced. companies around the industry and my own company included did make poor business choices and cost customers money in the communities we work economic

growth. however u.s. global financial-services remained loyal to this and the countries we operate in the united states. what we do as a company is very straightforward. we help people live their lives. what is an individual in the first bank account an entrepreneur building of the business or a large company expanding and racing capital around the world. we hope people realize the opportunity li presents for them. and we do a very well. we will always be a place for weeks of all sizes, small community banks to large banks like ours and we also believe no institutions shouldn't be too big to fail. i'm proud of large financial service providers help people seize the opportunity bases on life. seeking to dramatically shrink the banks would not reflect the realities of the economy we face. if those who advocate that i would stick the old adage careful when you wish for. as far more astute financial commentato myself observed.

the desire to remake the boarding school banking industry of the 1950's is understandable. unfortunately the only way to do that would be to bring back an economy of the 50's, too. the defining feature of the economy in the financial system in recent years has been changed. that change has been unsettling to institutions and consumers and companies alike. it is a deep volatility we have to manage in the future. when markets stabilized the change continues. financial service providers continue to look at how we operate. in response to new regulations and customer demand. we've been a big charge rt of the change emerged in the crisis of different company we bent and. we are fortunate to hold positions and every financial sector in the industry. we are a global company operating across all major economies. we also believe this new customer tell you proposition emerging. we hear from our customers want clarity, they want transparency, they want simplicity and they

want help and that is what we try to provide for them. we begin to adopt the practice is begnning in 2009. we declared commitment in the mortgage area and we move that through all oter products and deposit rds and otherwise. customers of shom the appreciate that approach and we believe we are willing to bring the business of future because it helps keep the affairs in order to read our business model emanates from the idea that clarity and transfer c would generate more value, products, more services, loyalty from those customers and return to generate more value for the shareholders. to that and we focus on a four straightforward response of growth as we move forward. i hope that will continue to restore what i believe is the sense of service and him of the and sustained profitability on the industry what things we need to remind people of and live up to. i'm excited about the opportunities, the opportunity for bank of america, the opportunity for financial service industry and the opportunity for the country. our industry and our company can help create opportunity and financial prosperity for all of

our customers and also generate return for the shareholders. our job is to sh this economy forward and keep this growth continuing and we will do that. thank you. [applause] >> we are going to in the two and a portion of the day and the first question here jumping at the current events with interest rates already very low and firms reluant to hire would it do any good for the fed to push rates any lower through quantitative easing? >> that is a policy decision and my job is to react to policy and also not make news on policy. [lauter] i think the interest rate structure is the lowest it's ever been. i have someone check this the

other day. they looked at the ten year bond across the last 50 years or something like that and it's been 10% of time it's been below 4% and this is half of it and it's been 5% below 3% this is half. it is is people making commitment. i would say as i observe for the compies, it's not available, it's not the cost of money, we've had the most robust capital in the market and we've had in history in the last six, eight, 12 weeks and there's not available be in money and cash out there and it's the reality we have to see the opportunity and have the willingness to vest and that comes down to the question. will i get them in the products? is regulation going to be understandable and if i can make the investments? and emi certainly enough i could take the risk for my shareholders and i think that is as important as getting the environment that is very low and supportive of grth. >> banks are beingasked to stop hoarding money and increase

lending. but at the same time they are being asked to increase capital and submit to a variety of regulations. how do you square that circle? >> we have tremendous capacity in the balance sheet to fund loans so the idea that capital requirements won't -- will not if they are adopted as they have been proposed now. if they raise themubstantially the industry would have to start shrinking and the would not be good and policymakers in the with a good balance. as i said earlier on the commercial side small-business site we get asked about. the reality is for companies that have a track record one of our loans of 100,000, 200,000 up the approval rates are higher. our stitution and that institution is higher than it's ever been, and the simple way to think about this is the toughest part of the environment right

now is for small companies engaged in something like a restaurant or real estate development. that's tough and there's good reason. those markets are in tough disarray. but the way to think about it if you think about what i said earlier where the commercial customers are borrowing at the lowest levels of the lines of credit, they don't he to do anything but senthe notice to borrow that money and so it is not a question of making credit available it goes back to the question with the woodring. >> on your announcement to freeze for closure nationwide, first, why? how many mortgages and foreclosures will this affect and how long will this take to clear up? >> i think we have to start from a hgher level and think about what's going on. starting as delinquencies rose about really three or four years ago housing prices could going up in 2006 in the third quarter and so delinquency started

moving and those of you that remember the supreme lenders went bankrupt and 07 so this is we are deep into the process. delinquency started ing up and in 2008 a company called countrywide and we have been working to make sure the company works for its customers and it's been a tough haul to do that so we are cleaning up what was left out of it. and so, we saw the delinquencies are to rise and now we are in the process of working through the system. first they start to rise and we have a lot of people who work through modifications, we did 700,000 modifications and this is a fair number of people. the 1500 people we serve is in the business so as a percentage it is relatively small but it's a lomore than ever. we went from 5,000 people to 25,000 people. and so we have done everything we can to help these home owners through the process. it is a very difficult process. when you read the letters and cards i get and e-mails leggitt, my e-mail and public domain it's

always a situation in person has lost their job, had difficulty in their marriage, has gotten sick, these are difficult situations and we are at work on that trying to handle in the best humanly possible way that they can read what we've gotten into in this last thing on the foreclosure as we have to clear the air. we haven't found problems in the foreclosure process and we are trying to clear the air and go back and clear our work one more time, but we haven't found it and there's a technical issue we are checking our homework again making sure we get it right after it's been checked multiple times and after we do we will continue the process but the reality is that is reflective of the location we as a country need to keep working on which is to get people in good places to live who are in difficult times and may not have the financial wherewithal to carry so we are working hard to do that and i think that this was the focus in my mind should be. >> what kind of impact on the hoing market do you expect the bank of america for closure free to have and does this mean homeowners who haven't been paying to stay in this home

while it is being sorted? >> the amount of work requires the matter of a few weeks. this is so i don't think this will have a substantial impact on that as anything we see because it will be for the process of double checking the pieces of paper we need to double checked, but the broad issue to back up is we hear about the overhang and the housing market of the so-called shadow inventory and there's a number of homes, and for the process, but that's the issue in terms of intact s opposed. >> what happens if the courts threw into question the issue who owns mortgages? >> that when i'm not as familiar with and i have to get experts to talk about. it's not something that's come out as a question of affidavits but i haven't heard that come up. >> to talk a little bit earlier about the need for consumption to get through the economic

recovery that the same time the need alternately for savings rates to increase among americans. what incentives are there to save on interest rates paid to individuals are so low and falling from that is the bond market and putting u.s. treasury already showing signs of a new bubble? >> the policy makers' decision is to force us as consumers to ha this discussion with ourselves which is why aren't i putting this money somewhere else and my bank account earning 40 basis points or something like that so i think it's having the intended effect if people are starting to question why am i doing this because that is what it is supposed to do. but so i think that as i look at it the rate is structured that such people first look to replace the yield they lost as rates fell and that is why the debt markets have been active, people looking to replace the

yield and the quality of the companies in themarket they've made it through a crisis that's never been seen before to come out with a very strong balance sheet, earning prospect, bigger efficiency, of course the debt in those companies as well received by the market, so i think as you look at it i think the interest rate environment is proposing -- posing the right question which is why are americans not taking money ut of the savings accounts and putting to work to do somethi else? buy a home, buy a car or more important invest in the market as a way for their future health issues are still uncertain and as the heels will start to see them money. it moves in cycles. when we had the debt of excess its critique a while for people to get back on our feet. we see that and one of our colleagues is from a competitor financial services firm in the financl the advisory business and some of my colleagues are here and customers are getting more active once we get back from holiday and the uncertainty

of the flash crash and other things so i would expect it's st going to take time would be my point to focus on the way i'm not going to give in to the aspect of the policy makers -- >> the financial service roundtable launched a major campaign recently to encourage americans to save noting more than half of american families have less savings than they need to and a minor financial emergency. given that, to what segment of the american people are you speaking when you ay that now is not the right time to save? >> i'm speaking to people who have more discretionary income obviously. and but if you look at the american public in terms of households that earn 70,000 jobs or under $75,000 above or $30 and under i think the and attributes of the people who are in 75 and above in terms of their carrying their data and living costs they have more money and the safe in their savings. weeed everybody to save more in the country long-term short term the people of

discretionary, and being a little tongue in cheek when i say that. i want them to save the realities of the utback to much hurts the economy because they drive the economic activity in the country. the bubble population that earns $75,000 up, they drivea lot of the purchasing. so i wouldn't discourage anybody from saving, i wouldn't discourage anybody from investing in merrill lynch but i would say to them -- [laughter] i would say to them the reality is if you sum that up the individual decisions and the mass americans that earn good wages and good wages above the cost o living to all that money invested in the bank of the wint street but to the question of the invested more the companies can work interest expand their capital, expand business and stuff like that. >> fm stevan to spending, how can think of american of a fortune 500 companies to store spending so small businesses can grow their business?

>> i think one of the things i call for is the argument between big and small and the reason i call for that is we depend on small business customers a major part of the company obviously small and medium-size companies derive a lot of your customer growth and so what we decide to do is look at the purchasing decisions and we said let's take 10% more of the next few years and dedicate to smaller businesses. we already have an industry leading when a minority-owned providers of services were ranked as high as anybody we said you know what, in addition to that we will do another 10% for small. that doesn't sound like a lot, it is 1.5 billion if i've got it right, that's a big number. i think large companies want to do this, are willing to do this and want to talk to my colleagues of the business people i know they are giving it. what you're putting up there is the issue i think that gets lost sometimes. the injured connectivity between purchase and supply chain and larger companies refuse the small companies. for a company with ten employees to become completely independent

of any large company or meum-size company for its operations it may be a stand-alone restaurants, it may be a couple other things i could think about, but generally it's going to be somehow involved in the economic flow and we need to get out of whether it is small or big need to get e economy growing and this doesn't help, so our job when we look at this issue was make more loans, to 5 billion more, we 45 billion more and then second let's create revenue because that is a bigger telling us they need and 10% of the purchase if you work for a large company i think if we could do that that would help the small companies grow faster. >> many small businesses continue to cite difficulty and obtain credit as one of the most serious problems they face in their efforts to survive the current economic climate. why does this remain a problem and is likely to change anytime soon? >> as i said earlier the problem of small business credit has become much more localized not in terms of local geographic but

local industries, a localized certain industries, industries which have always had a tough prospects to get credit are going to be tough. we charged off third quarter of 2000 negative the peak of annualized rate of 17, 18% of the small business loans. so we didn't make the cret on going decisions evin and good times so a lot of us pull back and if you look where the losses were coming from it's coming from $50,000, 100,000, smaller loans in areas wich get hit hardest by recession. residents of construction, small residents of construction companies, small restaurants and things like that. those areas can be difficult to get started until we figure out how to get housing research and things like that. when you move away from that into of the otr types of industry, small manufacturing law firms, architecture firms and things like that, credit i think printing rates we've never proved before and not because we are trying to do it, because the credits are small and in good shape having a difficult time

but i think the impact on small and medium-sized businesses of the construction economy both on the presidential and commercial construction industry and things like that is more heavily suited because by most definitions and the 500 employees and so every engineering firm i've ever met, every architecture firm i've ever met most law firms that were involved in those roles will business and they got hit harder because the tide to that chain including truck sales and the other stuff, so that construction issue is quite a lot of work through the access of construction so it's localized by industry giving everything we can. we've done to present more this year than we said we would do and we look at least to support the purchase power. but as you hear this i would ask you to think through the question whether people are asking for equity or debt and for asking for equity that is not the business we're in and for the administration started to push on more things to help people get the capitol.

>> according to statistics from the bureau ofeconomic analysis, real corporate profits in the financial sector on the eve of the financial crisis were roughly three times thosef the nonfinancial sector. during the crisis financial sector profits dropped below those of nonfinancial, but they have since risn to the mir early ratio of 3:1 of the values are lower. with this explains the gap that you see between financial and nonfinancial sector profits and is a justified? >> i need to call a friend on this one. [laughter] negative financial-services got to be from a broad context i think 17, 18% at the peak was it something like that is, maybe 20? and ms. moore, we were engineering profits. i think right now our economy is turned more than half of what we

should earns we have a lot to grow and it's hard work. we're growing money the hard way right now and coming out of the tale of the decisions i would expect less than the industry appears to earn more money so this difference will continue to read that we reflect the economy so as you might say we were the aggregate of lot of money it's a reflection of hundreds of -- 50 million in this case, small businesses, 30,000 of the market companies, many large businesses, an so it reflects the economy. i wouldn't rule against financial ofits honestly because it reflects the profits are going on in america and i think whether it will see in that ratio would like an expert -- in this room has not backed three fast because the capabilities to do so. but yet, it is still where it should be. but i don't think i would writ against that because it means our economy is not doing as well as it should. ..

be able to do what he does for a financial service come meet us. i was a cause of a lot of us. so i think if you look at systemic definitions, the consumer bureau and how it relates, a mortgage loan is a mortgage loan. definitions, the consumer bureau and how to relate to everybody that's enacted. a mortgage servicing mortgage

son. don't care whether it's done by this entity, that's inaccurate that committee. has to be debated. and so that's not the first time this has happened. this is the third time in my business career is happening. if we have a principal assistant runs under the tent. national gangsta and engage in subprime lending. anyone that waregulated by the national banking system. so you have to have a down payment, has to look likthis and get everybody have to live by it. i don't think we'll have the issue and mortgage lending again. there may be other ways to create problems, but won't be severe if you have java down payment to buy a house and can't have adjustable rate that peopl can't figure out. so i think the principles of less leverage, more capital, everybody's under the tent are really the key principles. and if we can do that right they think of transparency and everything will help in the systemic definition will help you but the realities of the you keep leverage down, you keep everyone involved.

we may not o to predict what happens but who will be volatile hopefully. >> have credit rating agencies than sufficiently regulated? >> i think that goes to everybody under the tent. i mean, i think everybody needs to the acton said, you know, did we think about people who were given a special border process. what are credit agencies and other types of entities and we did think about how to think about them in the forms they got into in terms of public companies and things like that. but the key is to keep everybody in the tent and everybody working for the same goals. i don't want to reflect on the credit agencies versus the exchange. the ideas they have it be regulated and regulated well and regulate with a purpose that is to provide for a stable long-term growth and economy. and i think the provisions the other regulation allowed to have been. we have to be careful what we wish for because as you know they change the rules about

credit rating agency dependency and some things and that makes the world were difficult from a whole host of things, which may not be a great idea. so i think -- i would want to blame any participant or one thing. i think the whole thing is to get everybody into the tent and get a regulated. >> some countries notably canada avoided a real estate meltdown. what lessons should we draw from your experience? >> the structure of the mortgage market in canada attributes which were different than the u.s. fixed-rate durations. in other words, you can get a fixed-rate mortgages easily at all. the government turned to different types of portions of it. honestly come to have more modest growth so therefore they did not quit the existing housing which is filled by the mortgage market, but also not filled in terms of economic growth and activity. as i think fighting wih satellite to learn about a mortgage market. secretary daycare plans to have

the outlines of the gse reformed early next year as he said publicly i think all of us have thoughts about how we cado this better in hindsight. i think it cannot be careful. many of you probably own a home, many of you have a 30 year mortgage. it works except your mortgage could be more costly. and so free ste fair to have pay marcotte to avid this issue come up and everybody's got to make that transition. when i find in cases like this as as i'm not going to cause your problem. about 30 or fixed-rate and we can't have that attitude. it's a societal question. i think canada has made decisions about portability now these differenthings that are geared towards discouraging bad. we had a set of policies geared towards encouraging homeownership. it's going to change the again change them but it has to be across the board. and i will be difficult for americans consumers of some of the ideas here get thrown out because this would change

dramatically the benefits of all gotten from a barrier of us, very efficient and very able to borrow long-term fixed-rate mortgage market which is very difficult to manage for the financial services company. we have a bank of computers is because the room to runtime managed volatility running interest rates. i mean, you all have an option everyday to decide whether to keep that mortgage outstanding and we have to guess what you're going to exercise it. i think a careful what you wish for. we've got to have a levelheaded decision but we can learn about saty and soundness and down payment and things like that would help us in the future. >> would change in federal programs such as when the nation tax credit for the interest on tax credit possibly be helpful? >> there those that advocate that would be helpful. you know, i'm not sure i feel that strongly either way. in the sense that i think the sort of trying to solve the problem with a narrow question, which is if you fundamentally believe the volatility of

mortgages is mostly created by the evaluation, the country can ma a decision whether much of a tax credit for interest reduction or not, that is a decision now want to inflame the tax code. the devaluation, i think responsible down payment requirement that stick with you no matt what brother house prices are raised or not s key because i'm in the car ultimately is going to build testing engine on their site they are in the volatility around it. today we hear about underwater mortgages, only 22% underwater totally. despite a huge falloff in values and our country. by the way come researchers look at those they very localized. only 14% outside the four states you could just under waters and it's actually less than that. so if you kind of think about the issues, the hard assets having a down payment stuff i think is mh more valuable to talk about and have a discussion about. it will slow down the ability for children to have a home.

but that's a better discussion i think into debate the interest rate and the mortgage reduction. that's for a different purpose. that car has to have an engine and has to have a down payment attached to it. >> so have americans been too hung up on hardship? is renting okay? has been a goal of resurces? >> and when i were having this discussion earlier. he asked him if he owned a home and he says no. i said it hasn't beenall it's crked up to be for everybody. i think people make great pieces pieces to at and i think people ought to decide whether they wanto put the capital of the home were not. and so, they have to make a decision whether they want a home in a book from sacramento to borrow novel come to the decision of whether you want to have volatility from what could have been in difficult times. but i think those are individual decisions. i think in the country would

benefit tremendously by the homeownership from world war ii on, one of our comments years a real estate broker in her experience made a lot of money and she should. and so the issue is with that to be careful about the concept of whether homeownership is up relations occurred in a population growth is probably more narrow, what does that all mean? and also the localities of homeownership. in some places and shortages emerging again in other places. shortages multifamily houses in your cities. think the housing policy. ownership will look back and say cheese made we should've done us much there. and i think that will change. the qution is don't confuse that necessarily with a series of individual decisions every individual should have the right to make it we should encourage them to make them. secondly, peopleake good places to live and i think a society were not built towards that outcome. in the closer thing actually is an issue by making sure people

of good places to live and don't have to move and type school times. >> this person writes bank of america raised 500 billion mortgage debt. how much of that is non-performing? >> it's a small portion. will release iran's next week and you can see. let me give you the other way around. i don't know the number of the top of my head honestly because i try not to store every fact they see every given day. but what i will tell you is we're seen the delinquencies and all are consumer products have been going down quarter after quarter, month after month and that's good news because that means americans are healing. we've got to remember that 95% plus of our mortgages pay us every day. so this is a problem which is a severe problem for a small group of people and not as much of a problem for a big grouof people. to make another person writes,

brian, why would bank of america bank of america pay to financial advisors millions of dollars in retention packages, simply sit still at their desk and perform their jobs? over 7 million americans are simply looking for jobs. why can't we help them? >> we as an employer employee to 89,000 people in the market employing people everyday when we brought nrrow to understand what it would like to have a powerful company to get products and services than it ever had no quarter. $230 billion in capital worldwide presence. said we need to make sure you give us a chance to explain what all that means and that was in the worst context of the worst environment fr financial service in history. so it made a decision to do what we did. so we're doing our best to employ the people we have. we try to maintain relatively stable employment as we shift people around from task to task. i think as you look at that, you

know, you think it's all her jobs to make sure employment rate among people for both society but also shareholders in the church when that balance every day. you mentioned earlier in your speech that if the united states wanted to go back to 1950's banking system with smaller banks they should expect the 1950's economy. but looking at the 1950's come under me things that people don't want to go back to civil rights that come to mind. at the same time the 1950's the united states had a strong manufacturing economy, priest of unemployment rates. think one minor recession and certainly not a major financial crisis based on exotic ancient instruments. about about about the 1950's are the operative part simply some name that is unrealistic to everything will have again? >> let me ask a question. what was the size of the economy in the 50's? does anybody know that? is 15 trlion now. my guess it is the third of that

then. if that. it's how the much smaller. so the question is if you don't have the financial system, remember, the banking system -- financial services holdup 14 joined dollars in assets. a lot of it is actually held by mutual funds and other people. so this is a big integrated system that supports a $15 trillion gdp. i would venture to say to string back to what it was in those time frames would be a pretty scary proposition . so i think that the context that statement wa made. >> looking at the foreclosure crisis and have a chance to reflect on it, if a real lesson here there were people getting who simply didn't have mortgages and some folks currently facing foreclosure now simply need to be cycled out of the mortgage market? >> typeset on many patients i think the industry and were cleaning up the countrywide makes you reflect on that everyday. the industry overland and

borrowers over part. and i think we can think about this going forward. and i get back to the house in a debate at the consumer level. do i have to have a down payment? how much income can i use disport my house? the weather look at that faa think i would put reflect on it over the last couple of years am thinking about what i've seen is i think there's equal responbility. the differences i think our industry has to lead to the right place because it's hard to organize the 60 million mortgage holders to get their situatio do right. so we have to be a leader in figure know what to do until the products of services. but we also have to make sure that people don't try to overpower her. i mean, there's always a way to borrow money whether it's from us or someone ouide her industry. we have should hopefully teach responsibility. interestingly enough as we study global democrats for a diversity group which is very active in our company we've been n studying generational issues and diversity which is the first

time in america's history we have four different generions of work for us. on the generation my son are evidencing andmuch more conservative attitude than my generation. or more like our parents generation. he think even with the amount they've sort of live tonight so far has been that in a time finished if he is about more similar to people who live with depression that i appear instead. and so i think there's a good soberness. i think it's good. i think it will work out, but there's equal parts of responsibility here. we have commuter have to know this because it's hard to organize all the other people. but there's no question. people over part and the companies over one. do not given challenges facing global banking speaking of diversity, a ibank of america plan to consolidate or expand global footprints. if it plans to expand, to which markets? >> look at our business to sort of serving companies and asset managers and people like that.

we look at them everything outside the u.s. we serve the high network companies and investors and we continue to expand. so just to give your way to think about that we have been repositioning the u.s. economy as states lower in the great scheme of things to serve capital markets and companies outside the u.s. so we will do that. we have credit card business in the u.k. and canada, but outside that we in those two businesses will continue to expnd to get the opportunities for growth there. it is important to serve the u.s. client who are doing business there. our clients come to us and say we need to open u in country a., b. or c. largely due to the fact the broadcast manament forum because they built a plant in employing people need to consolidate to cash and make sure the worldwide treasury can see it. are continuing to expand outside the united states and inside the united states. there's more financial advisers

now than they've had in the history we continue to grow that because america needs good financial advice and we need to continue to grow that. our commercial banking teams are expanding. the management bankers serve behind them to help her in the bank products and from those customers. were expanding outside the united states and much more narrow company. you will see the big bridge down the street of bank of america inside this country. >> we are almost out of time, but a couple of important matters to take care of. fit reminder members and guts of future speakers. just me for one moment. october 12 general martin schwartz the chief of the air force will be discussing services on going a first organize, train and equip itself on the two wars in iraq and afghanistan. on friday october 15 with condoleezza rice, former secretary of state on october october 25th im hersey ali, the author is going to be discussing is islam a religion of tolerance.

second, you want to say that water glass. rerd present you with the traditional national press club mug. [applause] the final question is in your address you talked about the new consumer financial gourmet can a positive contribution if done right. talk about riveters legislation being positive if done right. how do you define done right in financial regulation? >> i think it's clear that we need to balance the short and long-term imbalance do feel we may have to curtail activities which are citical of the markets. so that maybe the two specific examples. we been in a deal to push forward mortgage regulation to a consumer bureau. so l's not do what the people who are not regulated financial institutions and that would be a huge mistake to get the mortgages will migrate to financial institutions. and so what i've done right is

everybody on the 10th for example. we think about derivative secret is that everybody has to -- everything has to be exchanged. we have lots of clients who we too often hedging input of oil into their production process or an input of some other precious mineral. the last thing they want to do is put that viae information out from the markets you can see the prices on the buyer and seller inputs. and so they have gone inside don't make this apply to us because it's what we call bilateral contacts between us anew. it's as if we take your financial financial affairs and have to post them for transparency which there's no transparency bause of one off trade. those are examples we can push this point would impact commerce as opposed to look interest rate driven to his purchase rate driven has come up the mall out their servant can see the counterparty. so that's i've done the right and i know that gets technical nuts i didn't talk a lot about this today. but those of the kinds of things we should avoid. and frankly you should try to avoid wishing people ave

pointed everything was done right. >> thank you for coming today. [applause] and thank you two of you for coming today tthe national press club. today's meeting is adjourned. [inaudible conversations] >> up next, shell oil co. executive vice president russ ford, followed by spencer abraham and energy supply issues. after that, a discussion on the 2010 for the season. -- flu season. we will show you the 31st annual news and documentary emmy awards ceremony tonight. special powers went to -- honors went to p.s. news hour.

presenters included diane sawyer, dan rather, and lester holt. >> we provide coverage of politics, politics -- public affairs, and nonfiction books, and american history, all available to you on television, radio, online and social media sites. we take c-span on the road with our digital bus. it is washington, your way, the c-span network. created by cable, provided as the public service. >> shell oil company executive vice president russ ford talk about the bp gulf of mexico oil spill and the need to pursue energy sources and other than

petroleum. following that, former energy secretary spencer abraham on the threats to the energy supply in the u.s.. this is about one hour. >> good morning and welcome to the third annual energy supply forum, sponsored by united states energy association. my name is barry worthington, i'm the executive director of usca. thank you for being here. and thank you also, we're live on c-span2. so we appreciate all of those in the television audience participating as well. we have a very exciting program lined up for you today and with no further ado, he' going to introduce our first speaker. other opening keynote is russ ford. russ is the executive vice-president on shore gas, for shell exploration and production. he is responsible for all onshore development and production of natural gas in rth america.

and we're very happy to have russ here, even though he's a graduate of the university of michigan and there are several penn staters here in the room today. nevertheless, please join me in welcoming russ ford. russ? [applause] >> i actually thought i have might have get through this without having any reference to the penn sta-michigan game, but barry didn't allowing me that discretion, so good morning everyone. it's grates to be here. thanks so much for of the invitation for myself and for shell to join you today. we've got a trade industry group, people familiar with the energy business, so you probably all know shell, our brand is everywhere, one in four americans live within 5 minutes of a shell branded gas station, but our energy portfolio is pretty diverse in ways people

don't think of. for stance, shell has a sizable position in wind energy in the united states. we generate about 900 megawatts aa day from 722 turbines in our wind farms. in the americas, we have a strong biofuels position. you may have seen our announcement earlier this year in regard to our intent to form a $12 billion intervention in brazil with the supply, distribution and retail of transportation fuels. that joint venture is going to enable shell and cosan to have a position in sustainable biofuels. one oso the energy mention of te future conties to evolve, but regardless of where your preference and passions lie, i'd submit to you that it's undeniable that oil and gas are going to continue to play a major role in meeting u.s. and global energy demand over the next knew decades. energy is a top tier issue here hat home around around the globe and shell wants to be parts of

creating forward-looking solutions. so this morning, i would like to focus on oil and gas specifically domestic oil and gas. today, we look at oil and gas in a vastly different way than we did 12 months ago. why in because of catalytic events that have occur over the past. one of the events is the tragic loss in the gulf of mexico that claim 11 lives, injured a number of other people and resulted in the worst domestic oil spill ever. imag were etched in the consciousness of people. our employees, our customers and neighbors, along the gulf coast are experiencing firsthand the damage to the environment and the disrugs to their economy and to their way of life. the second event is truly drapetomania mat tech shift in another way and it's a shift in the domestic supply forecast. in most parts, due to the ability to produce abundant, clean burning natural gas from the new shell gas resource place in north ameca, both the united states and can dam the

full benefit of what this resource can do for us as a counseacountry, is still the suf an awful lot of analysis and debate. but it is a once in a century opportunity for many regions of our country and for our nation as well. so one event is tragedy, the other, a success story and an opportunity. but both give us new perspectives and some new opportunities. personally, i have some expertise an insight to offer in both the offshore and onshore oil and gas arenas. i crently lead as barry said, authorities america's onshore gas position. in my previous position, i was upstream technolog director where i was responsible for the drilling and technical staff that delivered some of shell's most recent record breaking deep well drilling. dc10 iyou heard of it in the deep water bra sell and in the gulf of mexico. and perdido was engineered, designed, drilled and constructed and finally

inalled and operates in about 8,000 feet of water in the gulf of mexico, so it' one of the world's deepest production platforms that's online right now. first some remarks on domestic offshore development. offshore oil and gas development, let's take a look att and how our industry has come together to be prepared in a post bp horizon world and why it's in our country east best interest to continue developing our natural resources, including those in deep water and how we can do so safely and responsibly. so first and foremost, at shell, we consider personal safety and prevention of major incidents to be absolutely critical to what we do fl we've g an employee and a contractor safety focus and safety procedures that are underpinned, but i think it's what we call our 12ife saving rules and the concept of goal zero. goal zero, everybody can call home safely in the evening. there's no question that safety d environmental protection are alls and always are going to be shell's top priority. we encourage and reward personal intervention. what that means is that every shell employee and every

contractor is obligated to stop activities that they see that could lead to unsafe situations. if they don't, they choose to work somhere else. we feel that strongly about it. on the well integrity front, be it an offshore or onshore environments we apply multiple independent barriers as part of our global well design, to prevent a loss of containment panned we put considerable effort into preventing the the release of oil ar gas in the first place. we're pretty confident in our expertise and procedures and we put our focus on five critical and integrated areas. we apply the same standards to our well designs and operating procedures all around the world, to ensure we've got the best designs in well bore integrity and safety. second, rigorous training. shell's well engineers undergo a training program established and continuously updated since 1973 that they have to complete as a condition of employment. three, risk identification and mitigation. we use a safety case approach, in our wells worldwide. this requires shell and our

contractors to sit down and systematically identify the risks and drilling operations and align plans to mitigate those risks. and that haifa linement is absolutely critical and it's mandatory before we begin drilling any well. fourth, robust independent barriers, shell wells are designed to have multiple barriers between pressure regimes and the surface. fifth, on a 24 hour a day, seven day a week basis, we employ remote offshore monitoring, so during drilling, shell operating deep water wells are monitored in real team from a glob network of onshore operating centers. this constant surveillance gives us oversight on critical issues, such as well pressure changes and technical support from worldwide set of resources. we know that we must demonstrate that we can and we do explore and develop natural resources, responsibly and safely and we have to be prepared in the events of a crisis. recently, shell partnered with exxon-mobil, with chevron, with conoco phillips to fund a $1 billion effort to engineer and construct equipment designed

to improve our industry's capability to contain an underwater blowout in the gulf of mexico should one occur. this entity is called the marine well containment company and it's a non-profit organization the new containment system will be flexible, it will be adaptable an be able to be deployed within days and be full my operational within weeks to capture and contain oil from a potential future underwater well blowout, should one occur. it's designed to enhance response capabilities for maximuprotection of the environment and it's designed to fully contain oil with no flow to the surrounding water. the ne system is going to be engineered thor provide a capacity of 100,000 barrels a day and have the flexibility to be expanded of we've also sent our top deep water drilling experts re to washington, d.c. to help policymakers better understand what's involved in developing resources in the deep water. we shared the information because we believe it's absolutely critical, there are policymakers thoroughly and accurately understand what's involvedso that they can enact realistic and workable public policy. now to my second point, why why

it's in our country's best from to continue developing resources in the dp water and howo do so safely and responsibly. it's important that we don't lose sight of the global energy challenge we face. over the next 40 years, global population and economic growth are going to drive energy demand to twice its current level. twice its current level. that means the world is going to need hall the energy that it can delop, including oil, natural gas, nuclear, wind, solar, etc. unfortunately, the decision to suspend offshore drilling until later this year resulted in thousands of lost jobs and billions in lost wages and spending pay long the gulf coast and places like alaska. we must realize that this type of incident san juan office extremely rare occurrence. and we should not rush to judgment on future u.s. offshore energy policy development as a result of that. it's also unfortunate that the deep water horizon incident has raised questions about the safety of developing natural resourcnaturalresources in offs.

shell has underg.o.p. intense scrutiny from regulators, courts and stakeholders. we don't commence operations anywhere in the world unless we're confident that they can be undertaken safely and responsibly and alaska is no different. the barriers and contingencies we have in place, and the significantly different characteristics of the wells we plan to drill in alaska, give us tremendous confidence that the chances of a similar events taking place in the alaska offshore are extremely remote. the subsurface risks for our proposed wells in alaska are different from those in of the gulf of mexico. most notably, in terms of decreased water depth and lower pressure. a typical well in the alaska outer continental shelf would be in 150 feet water depth and at 5,000 pounds per square inch pressure, versus 15,000 pounds per square inch pressure thaw often see in the gulf of mexico. in of the extremely unlike live events of a blowout or spill, shell would be ready to respond within one hour. we've put in place an

unprecedented three tier system con significance of approval rating on site oil spill response flight, near shore barges and oil spill response vessels and onshore oil spill response teams, that are staged across the alaska north slope. shell has had no significant offshore well incidents related to exploration and production in more than 30 years, including in alaska, where we've drilled the majority of the offshore wells, and had produced the cook inlet's for more than 30 years. there's never been a blowout in the applause can or canadian arctic. now let's shifters gears and talk about natural gas. natural gas in particular, is going to play a vital patrol as a bridge to a low carbon energy future, and as a fundamental parts of a long-term energy mix. natural gas is the cleanest burning of the fossil fuels, it's abundant, and estimates sh that there's enough recoverable natural gas to supply the united states for 100 years or more at current oduction levels. a potential growth area for natural gas is in powergain operation as the u.s. power generation faces looming fuel

choice questions. here's a few facts. there's 270 gig because of new -- gig new u.s. capacity needed by 2020. currently, 700 conventional coal fired plants that are greater than 30 years old and80 of those are greater than 40 years old. gas plants are quicker to build than coal or nuclear plants. gas plants co2 emotions are lower by up to 50%, versus traditional cool fired plants. and gas is a great partner to level i want mitt tent wind and solar generation. but looking beyond 2020 and into 2050, global energy demand is estimated toble do. new energy technologies typically take 25 to 30 years from deploymt to penette the rket to a 1% degree of market share. what does that mean? it means there's no silver bullet we're going to need hall the fuel and energy sources that we can muster to meet energy demands of the future. so what does natural gas profile look like? i'll give it to you in five a's. number one, it's abundant.

as i previously mentioned, about 100 years of supply, the add vents of the sales and tight gas sands in north america is an absolute bounty that is a one century events to a geography leak north america. it's hayfordble. henry hub place prices are currently less than $4. if you have kind of take a look at statistics over the recent past, that price level is about one-half of the last four years average, so from 2009 on back. it's acceptable from an environmental view, 50% co2 and it's a great renewables partner. it's available over 90% of the supplies of natural gas are produced within north america. and it's advantaged economically. there's around 3.5 million jobs associated with the natural gas industry and the's $1 billion of economic generated for every bcf per day that's developed. natural gas is so important to our economy hands to our way of life, that in a few years, more an half of our shell production in the americas could come from the onshore natural gas market in north america.

and let's knots forget that the gulf of mexico is not only where we get almost a third of our domestic crude fly, but also a major supplier of natural gas production as well. i just spent one week, last week with investors from around the globe that owned major positions in shell shares. i had the privilege of touring with them, one of our eight core natural gas projects in north america, it's what we call the ground birch project, which is developing the monty shale. i also had the opportunity to share our view of this growing business for shell. we built a significant coiguous ache rage position in presource plays across onshore north america, most notably in pennsylvania, in the eagle ferd in south texas and northwest louisiana and british columbia . our resource growth with east resources incorporated and eagle ford accusations that were a -- act wigs announced earlier this year, for a to the l after $5.7 billion, provide us high value positions with a great

deal of exploration and running roomality very low break even prices. we have the portfolio to invest $3 billion to $5 billion per year in our natural gas business in north america hands that's a big increase over what it had been just a few years ago. now our investment levels are governed by a variety of factors, these include certainly include near term commodity gas prices, as well as pour projects within the global shell portfolio that cpete for the same capital. but we have of the flebility in this investment level, andt will depend on the market an the portfolio needs, but also gives us the knew tour production range -- few fewer production range from 3.2 -- 2.2 to 3.2bc range and it's going to establish shell as a top producer of natural gas in the future. at shell, it's not just about the investments and the production forecasts, it's the project economics. we also know we need to get the envinmental and societyial issues right. when we go in to an area, we're typically in an area for 30 ars, so we consider stakeholder positions be very

imrtant. and believe me, we have people in hour organization who have an absolute passion for building those relationships and working with societyial issues in just the right way. we appreciate that some of our onshore stake holders have concerns around the activity and empackets from this new tight shale gas development. some of this activity is already taking place, in parts of north america that haven't seen oil and gas development in the past, or even in recent history. hydraulic fracturing that we're going to talk about this afternoon, seems to get a lot of that stakeholder attention. i know you're going to spend time talking this afternoon about it, but i want to make a few remarks on hydraulic fracturing. industries applied it for decades. more precentsly, new hydraulic fracturing technology applied in conjunction with the latest drilling and completion tools for horizontal wells and with technologies that allow us to drill wells more cheaply in shales as opened the door to real easing this great tight and shale gas, natural gas resource potential that we have in north america. concerns that the use of

hydraulic fracturing presents a risk in regard to drinking water contamination certainly need to be addressed, but in our view, these can be addressed by well standards an integrity that i mentioned earlier. wells designed and drilled properly prese little to no risk. i shared with you earlier the critical areas for offshore wells in regard to ensuring well integrity. our wells are lined with multiple strings of casing and cemented from the surface to below water aifer levels. we have employ other too to confirm that the fractures do not grow from the targeted deep gas producing zone, through layers of sands, silt and rock above the target area to the much shallower groundwater dep. additionally, we're working with state, regulatory agencies, and contract companies that supply hydraulic fracturing service to provide disclosure of all additives and chemicals used in the fracturing process. so we stand ready and able to put our skilled employees, our technology, an our dennis kucinich aids of experience to good use developing energy resources in a manner that preexpects the environment and helps us meet the united states

and global energy demands in the future. the responsible development of the gulf of mexico, of offshore alaska and north american ale gas will increase u.s. energy supply and security. it will help balance our trade, and create additional well-paying industry jobs in a very challenging economy. so with that, i thank you for your time and attention, and i believe we'll open it up to a few questions. [applause] >> >> we have time for a couple of quells. -- questions. >> no questions at all? right here. please identify yourself. >> good morning. this is karen with the edison and electric ins thiewt. how do you see the role of shale gas trump maybe new exploration

of natural gas in the offshore, is one easier than its other, do you see maybe offshore not being as nice to work in, is it easier to get shale gas than offshore gas? >> that's a goo question, karen. they're different. you know, the -- these shale gas plays are something that haven't been part of kind of the classic oil and gas development over the last few decades. i mean, people typically think of an exploration process panned a development process and then a production process when you bring oil and gas to the market. that's the sequence that you go through. and the exploration process offshore is a low probability of that, you know, 20% or 30% of the exploration wells might result in commercial finds. but that's jus-- that's jules the nature of the -- just the nature of the business. the onshore plays are difference. in many cases, the shale gas was known to be there for a long time. in some cases, producers drilled through it en route to something deeper but they couldn't figure out a way to produce it or the

gas market just wasn't there at the time. so these are known presources in those cases. they don't have that exploration risk up fronts. they go from kind of a knowledge base to development very quickly and typically, short circuit breaker cut that exploration step to a very great extent. so the real value, in how you extract the shale gas is in the development process. it's also different in the offshore in that there's hundreds or even thousands of wells that are drilled in some of these areas, so you know, shell right now, for instance, has 200 wells that are producing in the gulf of mexico and we're one of the bigst producers in the gulf of mexico. onshore, my guys drill 300 wells aor, so it's a much different development profile than you get into, so more certainty up front, but the real game is how you develop it, how you develop it from an economic standpoint and how you develop it responsibly as well. >> hi, dusty.

>> i've heard talk about the price of natal gas in relation to, you know, how economical it is to drill some o these new onshore wells. what is your take on that relationship, what -- at what price does natural gas have to be to make it compost effective to drill shale gas wells? >> well, you know, certainly if you look around the u.s. and canada right now, there's several hundred rigs that are drilling natural gas, so even at today's prices it's economic. it's a good question, because it gets to the matter of economics behind these things and forward belief. one of these wells that's drilled today might be producing 20 years from now, so the whole -- the proposition that you're looking at, the economic proposition isn't just today's price, but what you expect prices might be in the future. so you know, i'd conjecture that

most of the industry is building production, not just for the month of november, but for what we anticipate the gas market is going do look like in the future, and some of the things we have talked b i think, give you around idea of at least where shell is looking for the future. we do believe that the five a's that we talked about, that is going to drive gas demand and as gas demand goes up, it's going to present an economic develoent for us to participate in for business. and the second point is, when we get in to one of these new plays, we typically, as an industry, are good at working the cost side of the equation, so when you drill that first well, it's probably going to be more expensive than theenth well or the 100th well down the line. so there's a learning curve on costs that continually allow us to improve a margin and be resilient to today's economic levels. :

>> i have read that the production capabilities have reached a high-water mark. i live like to ask if you agree with that, and -- i would like to ask you agree with that, and how if demand goes up, you would be able to keep prices low? >> i assume you mean in terms of level of production -- i do not think it does. natural gas is one of the few extra actable mineral resources where production has increased. depending on the time you have picked, it could be as much as

20%. i think it will continue. it is primarily because of the shale plays and the abundance of them in the united states. our focus tends to be on the lower 48. there are shall place in canada, too. some are untapped. i think as that development progresses, it has the capability of moving the production part of and up over time. your other question about what might happen in the future, it is a moving target, the 100-year supply. it was a lot lower a few years ago. we have not honed the death of what that resource base actually is. i think what hundred years of supply is possible. i think it could grow. we have not come close to reaching a high-water mark.

>> a question, here in the front? >> hello. i'm with s&l energy. russ, i was hoping to get your reaction to enter your secretary ken salazar's announcement last week of new rules for the oil and gas offshore industry, and a promise of a dynamic regulatory environment. >> thanks, sean. i'm an onshore gas i think i can comment on those numerals. one of them was blowout preventers and the other was around safety cases i think that start with the second verse. around safety cases i can expand on the answer i just gave you. i have absolutely no problem with the discussion around safety cases. i think that's something, if the rule is finalized the way i understand right now, is healthy for our industry. what we already insist upon safety case for all of our

operations. what those are not just shells matter, but managing safety and operation. and our business, in the oil and gas business all of us copanies have a lot of contract operations that each of these contractors haago now they want to enact safety. t what we inspect its a document to bridge the way one contractor and another contractor, and show, it sets expectations with us taking the lead. we feel we are responsible for our safety case in both the offshore in the on shore. so not a bad piece, not a bad piece of rulemaking, if that's the way it stays. on wp issue, i don't think that's going to be anything that we would object to. we were doing many other things that are in b.o.p. provision. i think the testing of the obese in a new term certainly is going to be something test the limits of how many b.o.p. cq contest any one particular time if it has the original test or something certified by an oem.

is probably going to be some backlog but when that backlog settles up, b.o.p. testing something that would be good for the industry in the long run. >> we will take one last question over in the corner. >> hi. charlie from the brookings institution. the treasury has proposed taking away some taxes, a variety of taxes as for the oil and gas industry totaling about $80 million. if those changes were to go into effect, what impact do you see would have on the gas industry? >> so in the gas industry, i'll talk about the impact. i so they can address how it would factor into other peoples operations or other company operations. i mean, i quite honestly think that we will continue to go forward. obviously, we have paid a lot of attention to any changes in tax. what we really like as producers

and operators gets back to the question dusty asked me before. we take a time horizon, a very long time horizon. if you take that kind of time horizon, you might get consistency not only in regulation but also fiscal policy. so that's ultimately what we hope for. you don't like about changes in near-term. now, i can go so far as to say would have a hugely negative impact on the way that we would you are on short operations. but what i can say is what we will push for is consistency across not only the federal policies, regulations and taxes, but also states that have primacy for a lot of development within the industry. >> one last question. >> i was wondering if you could give us any information about what the next big shale play could be or where the interest lies?

>> wow. you hate to give away proprietary information in a public forum, don't you? he wants the inside infrmation. so i think you could lug to a number of plays that are being developed right now to kind of get a pretty good ading indicator of the parts, parts of the country that are going to be big players here. start with the ones that are probably pretty common knowledge in terms of the size of the resource base. ben haines tough she'll in northwest louisiana that we are part of. and the marcellus shale in pennsylvania, also in new york and west virginia. probably the two biggest right now. but you've also seen very recently kind of right on the heel of a lot of excitement was building around the marcellus shale of the eagle ford shale in south texas. it's in an area that had been drilled come explore, produce what number of years. the eagle itself was exciting from to stamp with. one, it's a rich gas zone.

it's one of these shale so you can exportf technology for one play to another which is important to us as an industrial player. it's also more liquids rich. so condensate comes out of the groundith the gas. with the differential between gas prices are right now, that's attractive to many producers. i think you're going to see the eagle for grow. there's tremendous interest in place is intended that we tend to focus in the u.s. on shale plays that are in the lower 48, but one river in the british columbia. huge resources, and as you know most of canada's gas production or most of our gas production that is imported comes from canada. they are great supplies and a great to how high the bar is because we don't only look at production, united states production but canada prediction as a big impact on what manufacturers, what power companies, what residential users will pay or be exposed to any future.

so, you know, there's lots of other shale plays that have been around and have a huge amount of the phone info than that i mentioned the haysville and marcellus. although their much talked about come industries really very scratched the surface in ter the development, praising the aries these could be productive over. all those been a lot of discussion about what's happened in louisiana, pennsylvania, there's years of the puppet on a go forward basis that won't be around. there's other place, other plays that are being announced all the time. canada is involved in a shale in michigan. that had been previously exploit that there are shales across the west also. you upon respect the fact i can't say what we're trying to get into from the standpoint of leasing. we would kind of like to keep our fair share their, but i think you're going to see uite a number of shale plays produced over the next decade we are not producing from right now. >> this really will be the last question. >> hi. i'm with icf international.

pending rulemaking is under existing statutes, the clean air act, the clean water act are forecasted under various scenarios to project significant retirement of cold under generation capacity. i busy, i'm sure as you vandalize thiscreates an opportunity for gas and electric generation play, but can you comment on the adequacy of the gas transmission network to come in and fill that gap of pending coal? >> yeah, can you get the gas pipeline where you need to be? that's a good question. the network as a way of responding very quickly. the network of evacuation the is a big diameter pipelines is pretty extensive across the united states. let me give you an example when i see faster response. pinedale in wyoming. wyoming is not a large population-centric most of the gas is either going to go to the west coast or move to the midwest or even the east before the marcellus shale is online.

at a time when your short on pipeline capacity seems like it's something would get two more. when you back up and put it in perspective we started producing in pinedale or drilling in a big way in pinedale industry, shell another players in 2002. working in 2010 now. at this point i'm we've had two new large volume pipelines built by el paso and also by c do marken to go and west. that will bring the gas where it needs to be. with a little bit of planning and some investment, that kind of infrastructure developer takes place very quickly. if you're in place like the marsalis as a network of pipelines have been built up over times you have the same challenges. even from a relatively remote place like pinedale that does have some our operation in groundbirch, trans canada to allow us to move gas south. so i think the infrastructure will come to the graph resource. a good thing about these gas

resources is going back to what the five a's, their abundant and their abundant in their particular place. so these will be around for a long time. and i miss and that's what pipeline companies are looking for to establish their rate of return, their investments. [applause] >> my >> now, a look at the 2010 this season -- we will hear about the new -- flu season, we will hear about the new -- [captions copyright national cable satellite corp. 2010] [captioning performed by national captioning institute]

>> welcome back. it is my privilege to introduce a man who does not need an introduction. it is a common cliche, but i truly needed. our lunch speaker is the hon. spencer abraham. of course, he was the former secretary of the united states department of energy, and prior to that was the united states senator from michigan. we have had a great opportunity during his tenure as secretary of energy to participate with him and his team on many international meetings. in one year, i think it was 2003, when organized four ministerial meetings, and it is not so much that we did four in one year, but we did three in two months, or something like that.

it worked out very well for everyone. secretary abraham is also the author of "lights out." after his remarks, he might be willing to sign a few copies. please join me in welcoming secretary abraham. [applause] >> thank you. i would just _ what barry said in his introduction. we have the opportunity during my tenure at the department of energy, and i know similar relationships have existed between the department and other agencies, but i do not think it was ever any stronger than when we were there. we appreciated the work they did to help us facilitate a stronger international relationship with

in the world of energy. one of the areas that i addressed in my book is how critical i think international cooperation is going to dig in both addressing geopolitical challenges, which we face in the world of energy, but also in a dressing technological challenges. we were able, during my tenure, to launch a number of those initiatives, and it was with the help of the u.s. the eight to ea e those launches -- us to make those projects possible. let me extend, again, my appreciation. my book, "lights out" begins with a discussion of how you become energy secretary. i always feel groups like this need to have an insight as to how you might attain that job,

in case you ever wanted. let me tell you how i got it. in 2000, i had a very close, tough reelection campaign that came one percentage point short. in early november, i found myself trying to decide what my future should be. one option was the possibility of continued public service in a bush administration, if there was to be one, which she remembered, in 2000, was not decided immediately. i started strategizing along with friends about what you do to try to become a member of the cabinet. what is clear is that you cannot over the campaign for that type of position. -- overtly campaign for that type of position. you need to be subtle. we spend time thinking of how to put my name in front of president-elect bush, or vice

president elect cheney. where did they take their dogs for a pedicure? subtleties like that. none of them working very well. eve, ando new year's all three cabinet spots were filled. to the extent my name had been mentioned was to possibly to the in the secretary of transportation, and never as a secretary of energy. i was losing faith and hope pretty quickly, as the year ended, as was my wife. we were about to go out to drown our sorrows in a new year's gift -- dinner, and the telephone rang. the operator can run from the white house and said the chief of staff designate was on the phone and wanted to talk at that point, i thought it was

definitely no. sure enough, he came on and said i am calling to see if you would be interested in serving as secretary of -- at which point i said, yes. after which, i sort of have this realization that he had not said transportation. i then said, listen, i wanted to know that i'm thrilled, the lighted, excited, and i cannot wait. this will be terrific. there is just one thing you need to know, not a big thing, and i am beating around the bush tried to get to the topic. after the few seconds, i realize that the phone has gone dead silent. he is envisioning, who knows what -- drug abuse stories, or a horrendous piece of news.

finally, he says what is it? i said when i was in the senate, i co-sponsored a bill to abolish the department of energy. [laughter] just a minor imperfection. it might be something that might be a subject of controversy. he actually heaves a sigh of relief because it is not a massive ethical violation or something that would have been embarrassing. he told me to wait, and he would try to reach the president elect before getting back to me. my wife and i stared at the telephone for about three hours. finally, he calls back and says the president elect said you were widget he was ok as long at -- he was ok, as long as you no longer want to abolish the department. of course, i have changed my

position on that issue. of course, this resulted in an unusual confirmation hearing. you might remember the senate was eating me divided, and the chairman shipped duties were being divided. they've passed the first question together, the you want to abolish the department of energy. i have had weeks to think of how my views have changed, and then the hearing went on to other matters. the one funny thing about it was that during the hearing itself i kept feeling something bump into the back of my chair. i could not figure out what was going on. afterwards, i never knew what really transpired, but it

happened 12 or so times during my boring answers. later that night on the news, i discovered that my good friend, a school at the time was the governor of michigan, -- who at the time was the governor of michigan, and had come down to lend support, was seated right behind me, and he had gotten up at 5:00 a.m.. he was suffering from some kind of cold. so, he kept falling asleep during my testimony. the news of the lead was not the guy who wants to abolish the a part -- the department gets a chance to run it, but rather abraham was so boring, even his best friend fell asleep. that is how you assigned to this important job. truly, this remains a critical job at a critical time, an

energy remains an important issue, which is why i wrote the book "lights out." i hope you get a chance to read it and look at some of the ideas i present. the main points are two-fold. the first is when i would call an array of energy myths, and this is laid out in the beginning of the buck. myths about energy have thwarted serious public policy discussions in many cases as to how we as a country should build a more secure future. second, that sentiment combined with the politics of energy, which tend to be even more divisive and challenging to overcome than almost any other area of public policy debate. those political issues, combined with the myths, have served as poorly as a country as we have tried to move forward on the

topics of energy. i will not get into every myth, or all of the typical masturbation's, but let me use a couple of examples -- master nations to get to my point. one of the issues we addresses said nuclear energy is no safer now than it was at the time of three mile island. as i point out, the movie "the china syndrome" came out right around the same time of the offense that transpired at three mile island. that movie, compliant -- combined with the event itself has been indicted in the minds of public policy makers, media folks, and the public for three decades ever since. it has helped perpetuate the myth that it is no safer now

than it was in 1979, which i think is a great misfortune. we all know, and anyone who studies these issues know the dramatic things have changed. nuclear energy is much safer today. we have added so many safeguards. we have to address these challenges of making sure nuclear power is safely operated. you cannot compare it to three decades ago. based on that, we see countries from the united arab emirates, to china, to finland, to almost any other spot in the world moving forward with nuclear, yet that myth continues. in the book, i say if you want to see how far things have changed, just rent the movie "the china syndrome." you will see that jane fonda, who is the star of the movie, is

doing a feature piece for her television station at the nuclear power plant, which has a near-serious incident that is ultimately stabilized. she watches this happen from an observation deck overlooking the control room. she immediately raises over to the television studio, and writes the story to appear on the news. how does she compose it. she sits down at a manual typewriter, spins of ps of paper into it, and begins typing away. the reason she did was that in 1979, newsrooms did not have word processing, and computers, and things of that sort, and neither did the control rooms of most nuclear power plants. things have changed dramatically. just as we have a completely different way of handling

telecommunications and information technology and the like in 2010, we have also had a dramatic improvement in the safety and operations of nuclear power plants. this myth has to be, in my view, if penetrated, put behind us, or we cannot have the serious discussion of the nuclear power that i think america really needs to have. in the same sense, i think we have had political challenges that have been hard to overcome when it comes to energy issues. i remember, in 2003, when the northeast and blackout took place. i was energy secretary at the time. immediately after it happened, i received an invitation to appear before the house energy and commerce committee on the first day back in session for the members of that committee. i was asked to explain why it occurred.

we did not know why yet. we did our best to discourage the leadership from having a hearing that soon. they were consistent. they wanted to have the public see they were trying to address the problem. so, i appeared. this is one of these days when i think every member of the committee appeared. there were more than 50. each member gets a five-minute opening statement before the witness is heard from. to 85 minutes after i arrived, we finally finished the opening statements. it was my turn. one of the things that was so poignant about that day in my mind both then and now was the fact that we have virtually every member, and it did not matter if they were democrat, republican, north east, or southwest, saying we need to address these issues. there is a bill in the house, in

the senate, that has differences on energy and modernization, and so far. -- and so on. and, believe us, this tragedy will cause us to get this bill to the president's death -- desk in a matter of days. as i left, i told my staff, if it is like most things involving energy policy, it is not going to happen. sure enough, as you will recall, that was the first week of september, 2003, and the bill got to the president in august of 2005. it was significantly modified, someone said water down from the bill that was contemplated in 2003. as we have learned, even more recently, even when one party has overwhelming not -- numbers in the congress, passing the

energy legislation is a difficult political challenge. the politics of energy have conspired to -- with the myths about energy to make difficult addressing these challenges. . .

the projections for 2030 are roughly 700 million barrels a day. that's a net increase of 22 plus million but a gross increase that's probably going to require us to find some 40 million new barrels of production between now and 20 years from now. that's going to be hard because we've put many things off limits but because the low-hanging fruit has been taken. and so we will have challenges in the energy marketplace to make sure that affordable energy is affordable to those who demand it. we have geopolitical threats and challenges that face us. and they stem in some ways from

the fact that we have limited spare production capacity in the world when we have things operating in a strong economic context and as a result of that combined with unstable sources in many cases, we have geopolitical issues that are before us. and those threats are not going to go away. therefore, they require us to be aggressive in addressing energy challenges. and of course we have environmental threats and issues that face us, whether it's the issues of emissions or the -- the emission of carbons or pollutants, whatever, these are not going away, either. and so for all of these reasons, it really is imperative in "lights out" that we try to get passd the myths, to limit some of the political obstacles that have made it so hard to move sensible energy legislation forward. and, you know, get some real

forward progress going here before it is too late to make the tough decisions that have to be made before it is too late. probably everyone in this room had some type of expectation that some type of energy bill would have passed by this point. it hasn't happened. i didn't realize this but -- since this is the first book i've written. but to produce a book that will be appearing in book stores in july of 2010 as mine did, the manu script has to make it to the publisher roughly in september of 2009. so it had to be nine months ahead of the arrival date in the stores. so i had to predict roughly a year ago in the book, i had to sort of predict whether i thought we would move energy

legislation because so much of the book was focused on this topic of our failure to act. and even though at that point there was highly, i would say high probabilities that we would pass the bill, i wrote the book on the -- based on the theory it would not happen. i'm happy as an author that i was right but very unhappy as a citizen that that is what has come to pass. and so the house acted, the senate didn't. we shouldn't -- couldn't even get a bill brought to the floor in july as had been expected. and in all probability, the next congress will be even more divided one way or the other than the one that we have. so it seems to me that unless we really are demanding of action in this area, we face serious challenges of addressing our energy security needs any time in the near future. and, to me, the failure to do

so would be a catastrophic error. in light of time, i will sum rise right now. but i urge you to take a look at "lights out" because it not only addresses some of the reason that is we haven't acted but it has some policy ideas that might make sense as a pathway forward that hopefully could bring about enough consensus so that energy legislation that is desperately needed could ultimately become law. and if you get a chance, i hope you will take a look at the book and study that and if you agree join me in urging the forward movement of sensible energy legislation here before it is too late. and, as i say in the book, before the lights really do go out. thanks for having me. i will be glad to be available afterwards to answer any questions or sign.

and to all of you, i wish you a good conference. i know it will be. thank you very much. [applause] >> president obama talks about his education initiatives. then summit republican conference vice chairman john brosso discusses the unemployment rate, the expiring bush era tax cuts and how the new health care law has affected government spending. >> the other day i was talking about education with some folks in the back yard of an albuquerque home and someone asked the question that stayed with me. he asked, if we don't have homes to go to, what good is an education? it was a heartfelt question, one that could be asked by

anyone who has lost a home or a job in this recession. because if you're out of work, all that really matters is a new job. all that really matters is a roof over your head. all that really matters is getting back on your feet. that's why i'm fighting each and every day to jump-start job creation in the private sector, to help our small business owners grow and hire, to rebuild our economy so that it lifts up the middle class that's been battered for so long. but even as we focus on doing all that, even as we focus on speing up our economic recovery. we know when it comes to jobs and prosperity in the 21st century, nothing is more important than the quality of your education. at a time when most of the new jobs being created will require some kind of higher education, when countries that are out educated today will outcompete us tomorrow, given the kids the

best education possible is imperative. we have been fighting to offer every child in this country a world-class education. from the cradle to the classroom, from college to career. this week i announced a new initiative that will help community colleges and employers match what's taught in the classrooms with what's needed in the private sector. we can connect students looking for jobs with businesses looking to hire. we're elimb nating tens of billions of dollars, and using that money to make college more affordable for millions of students. and we have launched a race to the top in our states to make sure our students, all of them, are graduating from high school ready for college. so we can meet our goal of graduating a higher proportion of students from college than any other country in the world by 2020. and yet, if republicans in congress had their way, we have had a harder time meeting that

goal. we would have had a harder time offering our kids the best education possible because they have cut education by 20%. cuts that would reduce financial aid for 8 million students, cuts that would leave our great and undervalued community colleges without the resources they need to prepare our graduates for the jobs of the future. now, it's true that when it comes to our budget we have real challenges to meet. and if we're serious about getting our fiscal house in order, we'll need to make some tough choices. i'm prepared to make those choices. but what i'm not prepared to do is to short-change our children's' education. what i'm not prepared to do is to undercut the economic future of the united states of america. nothing would be more detrimental to our prospects for success than cutting back on education. it would confine america to second place in our fiercely competetive global economy. but china and india aren't playing for second.

south korea and germany aren't playing for second. they're playing for first. and so should the united states of america. instead of being short-sighted and short-changing our kids, we should be doubling down on them. we should be giving every child in america to make the opportunity of their lives, to threeve global economy in this century just like we did in the past and that's what i'll continue to do in the years and months ahead. thanks, everybody and have a good weekend. >> i'm john bar aso. when the code of the west says, when you make a promise, keep it. in washington, promises don't seem to mean much these days. for almost two years, president obama and democrats in congress have broken their promises on jobs, on spending, and on health care. the white house promised that massive federal spending would keep the unemployment rate

below 8%. instead, what taxpayers got was $800 billion in new debt and nearly 10% unemployment. 48 states have lost jobs. friday's job figures confirm that far too many americans are still looking for work. while the white house touts its recovery summer, most americans see an alarming autium. people are beginning to realize that the only jobs congressional democrats are really focused on are their own. the president promised to be financially responsible with your tax dollars. yet, our federal government continues down a ruin yuss path of outrageous spending, borrowing and piling more and more debt on future generations. our nation is now over $13 trillion in the red, a number so large it's difficult to imagine. since democrats took over the congress, the national debt has grown by $5 trillion. and the president's own budget

says it will grow by trillions more by the end of his term. astonishingly, instead of custing wasteful washington spending, president obama and the democrats plan to raise taxes. last week, congress fled washington while one of the largest tax hikes in our nation's history hangs over the heads of working families. rather than forcing congress back into session to do the people's business, the president merely waved good-bye. interviewed about why he wouldn't extend all of the tax cuts, president obama declared that he had, quote, a whole bunch of better ways for us to spend that money. with all due respect, mr. president, this money isn't yours. it belongs to the american people. the obama tax hikes are yet another job-killing burden that the american people and american employers cannot afford.

raising taxes on anyone in the middle of a recession is the worst thing we can do. our problem is not that we're taxed too little. the problem is that washington spends too much. as a doctor, i've also heard from americans who are concerned about the president's broken health care promises. in wyoming and across the country, we are now bracing for the president's new health care law. as you may remember, during the debate over health care, president obama promised time and time again that if you like your current health care plan, you can keep it. well, it's now clear that the president has broken that promise, too. if in june, the obama administration took two pages of health care law and transformed them into 121 pages of bureaucratic rules, regulations, and red tape that clearly violates the president's promise. employers, large and small across the country say they may

be forced to stop offering health insurance to employees. simply because of the cost and the penalties of the president's new health care law. and millions of americans, senior, could be forced from the medicare advantage plans that they know and they like. at the time of his inauguration, president obama talked about how the american people had entrusted him with a great responsibility to keep the public's trust. the president has failed to keep his promises on jobs, on spending, and on health care. frankly, very little trust remains. the president's policies are irresponsible, and unsustainable. worse, many americans fear the damage done by these policies may also be irreversible. i believe there is too much at stake and far too much to lose

for us to allow bad policies and reckless spending to remain unchecked or unchallenged. and so we will fight for a dramatic change in priority and direction. americans have a pledge to america, a pledge to reduce tax hikes, to reduce federal spending and to repeal the massive new health care law and replace it with common sense reforms that lower costs. if you are tired of washington's broken promises, you now have a choice. more of the same, or a new direction. thanks for listening. >> tonight, the 31st annual news and documenty emmy award sarme moany. presenters this year include diane sawyer, dan rather, katie

couric and lester holt. at 8:00 eastern here on c-span. tomorrow on washington journal, a discussion on the political environment facing democrats and republicans in the mid-term elections with democratic strategist maria car donea and republican strategist cheri jake obus. then paul barton. then bill addare with attack adds. live at 7:00 a.m. eastern here on c-span. >> the supreme court has started its new term and you can learn more about the nation's highest court with c-span's latest book, the supreme court. candid conversations with active and retired justices, reporters who cover the court, and attorneys who argue cases there revealing unique insights about the court available in hard cover wherever you buy books, and also as an e book.

>> now, a look at the 2010 flu season. we'll hear about the newest vaccines and efforts to prevent the spread of the virus. the national foundation for infectious diseases hosts this event. >> good morning. we're here to mark the start of the influenza season. doing so helps us to set the stage for what we can expect of the influenza virus and of the vaccines this coming season. as any of today's panelists will tell you, the influenza

virus is clever, unpredictable, and dangerous. we have seen it take the lives of the healthy as well as the sick, the young, and the old. this year, for the first time ever, influenza vaccination now is recommended for everyone six months of age and older. everyone. we hope this new universal recommendation will facilitate vaccination. no longer will you or your health care provider have to ask whether you fall into one of those groups for which vaccination is recommended. no more asking do i need this vaccine? yes, you do. i do. we all do. no questions asked. unfortunately, it seems sometimes that the public can be as unpredictable as the virus. in some years there's a rush to get the vaccine, in other years there's apathy. but i'm optimistic that we're

all becoming a culture of prevention. we're moving toward a new era of fluency, if you will. in addition, plenty of vaccine is anticipated for this year, and we understand there will also be an ample supply of antiviral medication. which offers a second line of defense in preventing the control -- prevention and control of influenza and also offers we as physicians an option for treatment. a number of factors are making it easier for us to usher in a new era in influenza prevention and cdc director dr. tom frieden will guide us through them in just a moment. in addition to dr. frieden, you will hear from dr. daniel jerngan of the cdc's influenza branch. also speaking today our additional speakers.

we have brought together more partners than ever in this public-private collaboration to support a strong call for all americans to get vaccinated. joining us are dr. lj tan of the american medical association, cheryl math yiss of aarp, dr. winston price of the national medical association, dr. john red of the indian health service, and dr. laura riley is here on behalf of the american college of obsstrigses and ginecoljists. they will be available to you during the question and answer session at the end of our program. so you can see there are lots of important and influential voices here today. i would like to acknowledge that where influenza vaccination is concerned, the voice that carries the most way for an individual is their own doctors. later this morning, i will share with you some new research that nfid has

collected about physicians and health care professionals as im ization influnesers and how they view vaccination. at this point, i would now like to introduce dr. thomas frieden, cdc director. >> thanks very much. and thanks to our partners for putting this together and for shining a light on flu. this year, the message is clear. everyone over the age of six months should get a flu shot. flu is serious. every year, millions of people get sick, more than 200,000 people are hospitalized, and thousands of people die from influenza. and there are thing that is are new this year that make getting the flu shot even easier. first, there are simpler recommendations you and your doctor don't need to wonder whether you need to get the flu shot. if you're old enough to ask, you should get a flu shot.

and even for people who are seven months old, you should get a flu shot. second, there's plenty of vaccine available. the vaccine is available well before flu is circulating in our communities. third, although it's always risky to make predictions about the future, and as yogi bera said it's always tough to make predictions especially about the future, this year we think that the three strains of influenza in the flu vaccine are going to be excellent matches with the flu that's circulating. from the laboratory data that we've seen in this country and around the world, all flee components are excellent matches with the kinds of flu that people are likely to get this year. in addition, this year it's an all-in-one vaccine. you won't need to get an h1n1 vaccine and a seasonal flu vaccine. we're also focusing on groups atest risks.

people with diabetes, pregnant women, and traditional groups less lick lie to get vacknay -- likely to get vaccinated. we've had progress in the last year. the proportion of pregnant women vaccinated last year was significantly higher than in most flu seasons. so there's a growing recognition of the importance of vaccination, of the threat that flu poses, of the importance of public health, and an understanding that prevention is the best buy. flu vaccination is the best way to protect yourself. finally, there are more choices this year. not only do we have both a flu shot and a nasal spray, but we also have a high dose vaccine which is an option for people who are over the age of 65 and may be more effective. we'll know more after the current year. >> some are wondering why we should have a universal vaccine

recommendation. well, the flu can be serious even in healthy people and can be quite common and disabling. not only can they miss school and work and become seriously ill, they can also spread flu to their family, children, parents, and others around them. so it's very important to protect yourself, your family, and your community. about one in ten people get the flu in an average flu season. those people miss school, they miss work, and they feel miserable for a few days. there's no reason to get an infection that is so easily prevented by the readily available and ample supply of flu vaccines. so the answer to the question should i get a flu shot this year? is yes. i did. i do every year as does my family, and i recommend that everyone over the age of six months get a flu shot every year or flu vaccination every year. thank you very much. >> thank you very much.

and following dr. frieden we'll have dr. dan jerngan. >> thank you very much for this opportunity to speak. i wanted to talk about two things real briefly about what we're seeing with influenza virus activity and what we think might happen this fall, and to describe how we use that virus tracking information each year in picking the three strains to go into the annual vaccine. the virus, as was stated, is unpredictable. this virus has a clever design. as the virus moves from person to person, it has the ability to gradually change the proteins on the outside of that virus so it evades these bodies' immune system. that means each year we have to update the annual vaccine to account for the change that is the virus has made. in order for us to have vaccine available for fall like we have now, we have to make decisions seven months earlier in

february to choose which of those vaccine strains will be -- which virus strains will be in the vaccine. so to monitor those changes in the virus, cdc and its international partners supporting network of public health laboratories, about 65 of those in the united states and over 100 in other countries, and for the last several decades we've been tracking three predominant. the first is the influenza b virus, and the second and third are influenza a viruses. the first is a, nch 3 and 2, and the second is a h1n1. we want to keep an eye on that h 3 n 2 this years because we think it might be appearing this fall in more numbers. in april of 2009, c.d.c. detected a new h1n1 that many of you are very familiar with that differed greatly from

previous h1n1s. and this virus spread globally very quickly and caused a significant number of cases, number of hospitalizations and deaths. we estimate four to fimetives drdr five times more death in children. if that had emerged a few months earlier, we might have been able to include it in the 2009 routine annual vaccine. instead, a second round of vaccine production was required, using the same tried and true manufacturing processes and facilities that had been used over many years for the annual influenza vaccine. during 2009, more than 80 million doses of 2009 h1n1 vaccine were administered with a very good safety profile similar to the safety profile that we see over the decades with the annual flu vaccine. in february of this year, in 2010, c.d.c. and its

international partners again met to select the three strains for the vaccine which is now being distributed in the united states. these again included an influenza b, an h 3 n 2 and the 2009 h1n1 virus. over this past summer we have been monitoring the flu viruses around the globe with our international partners and this week we will be reporting in the c.d.c. about what we've been seeing. the bottom line is that the viruses that are circulating in the u.s. and abroad are very similar to those chosen for the vaccine. and that is very good news. we also know that the viruses that we're seeing are susceptible to the antiviral drugs. so the drugs that we use to treat influenza will continue to work. in places around the globe that have seen a lot of 2009 h1n1 last year, they're now seeing influenza b and h 3 n 2. and starting in late august, it

has been the virus subtype most commonly identified around the globe more than the 2009 h1n1. in years where the h 3 n 2 is the predominant flu strain we usually see increases in severe illness among young children and older individuals. this is one more reason to get vaccinated. as of september 24, manufacturers are telling us the estimates of more than 119 million doses have already been distributed in the united states, and that's over 30 million more doses than were distributed by this time last year. this is good news since the vaccine is now recommended for all persons greater than age six months and there are new formulations for older individuals. so in conclusion, early indications are that this season's vaccine will be a good match to protect against circulating strains and getting yourself and your loved ones vaccinated is the best way to prevent flu. thanks a lot.

>> thank you for that message, d.n.a. and stick around for some -- dan. stick around for some questions. i have a few remarks. it occurs to me i didn't say hello. i'm dr. bill shaff anywhere. i chair the department of medicine at vanderbilt. this year the national foundation for infectious zeeses enhanced our understanding about influenza and influenza vaccination. so let me share some of those highlights quickly with you. we've all heard the disappointing influenza vaccination rates among health care personnel that have been reported over the last several years. they hover around about 40% or so. now, last year, which was an unusual influenza season, as dan has just told you, we saw an increase in influenza vaccination rates for health

care personnel and i surely hope that trends continues. i and many others have long advocated for our colleagues to be more responsible in protecting themselves and their patients by getting vaccinated annually against influenza. now, almost all the doctors tell me they do get vaccinated each and every year. so we decided to take a closer look and conducted a survey of 400 primary care physicians. we asked them about their own influenza vaccination history and what we learned actually was very encouraging. physicians are practicing what they preach. get this. 92% were vaccinated against seasonal influenza last year. even more, 95% say they have been already or plan to get vaccinated this year. so it appears that physicians

are fulfilling two very important responsibilities. they are protecting themselves from getting infected so they can meet their professional obligations. when influenza season comes, we need all hands on deck in our hospitals, clinics, emergency rooms, and private practices. they also, and this is very important, are protecting their patients. the doctors won't get infected and pass the influenza virus to the patients for whom they are offering care. it's a patient safety issue. also interesting is the discovery that over 75% of physicians reported that all of their immediate family members were vaccinated last season and they intend to get them vaccinated again this year. previous surveys of health care personnel could lead consumers, the public, to question the value of prevention.

and the statement that i've heard more than once goes like this. gee, if the medical establishment doesn't care enough to protect themselves, why should i? but in fact, physicians who the public says have the greatest influence on their vaccine decision-making, are setting the right example. if that's right, that's true, who is responsible for that low health care personnel vaccination rate we've been hearing about? the fact is we've got to consider the role of everyone in the health care facility, from the hospital's dietary staff, to the cussed toal workers to people who work in the laboratories, everyone who works in the physician's office. while we're concerned about getting everyone in close prosm yimt to patients vacknate, we have to hold health care professionals to a higher standard, to be vaccinated themselves, but to be vaccine

advocates for their patients. these physician survey findings are important because we found in a separate consumer nfid survey of adults that nearly 7 in 10 of those who receive the physician's recommendation to be vaccinated were actually motivated to get their vaccine. so the commitment to vaccination must be made loud and clear to patients, very directly, very straightforwardly. whether vaccinating them in the medical home or referring them to an alternate site to get vaccinated, what's important is that they be vaccinated. in addition to the physician's recommendation, the desire to protect family and friends and convenient vaccine availability were also among the other key factors in the decision about whether to actually get vaccinated. and if you have ever experienced influenza, you can

eemple thighs with the large number who were moat -- empa thighs wanting to avoid being laid up for a week. however, it's interesting that avoiding a week-long illness is a greater motivator than avoiding hospitalization and death. isn't that interesting. to me, that might suggest that people recognize that you can get very sick, but still don't quite understand that influenza is a life-threatening disease. so let me take just a minute to talk a little bit about how the flu affects the o body generally. you all have an illustration in your handouts that simplify these concepts. influenza, as you all know, is a respiretri virus but while the virus itself is largely confined to the bronchial tubes and the lungs, its impact can extend throughout the entire

body. infection can induce a release of siteo kines. these are molecules that mod late sometimes enhancing and sometimes reducing inflammation, which can have effects throughout the body. while some common complications of influenza are easy to understand like pneumonia, because it happens in the lungs, others may not be so easy to connect. but in fact, this so-called siteo kine storm can lead to complications like myo sites, which is inflammation and even destruction of muscle tissue, myo card dites and peri card dites, which is inflammation of the heart muscle itself, and the membrane that covers the heart, as well as aseptic meningitis and ensefflites, which is inflammation of the brain substance itself. so these citeo kines can have systemic effects throughout the

body. just as influenza is not always a very predictable disease from year to year, in fact some of us would say it's unpredictable, so is the psychology behind public acceptance of being vaccinated. what we found out from the recent research is that many adults and mothers view hand washing to be as effective as vaccination in preventing influenza. i'm just delighted that what we've been saying about hand washing and its importance has started to be embedded in our population and we see people doing that. however, as important as hand washing is, it's vaccination that is fundamental and much more important in the prevention of this air-borne virus. so while we're moving the needle toward fluency, we need to continue to educate and address certain

misunderstandings and misperceptions about influenza and influenza immunization. one of them is -- i hate to even give these myths kind of space. but in any event, one of them is that you can get flu from the flu vaccine. i hope we all understand that that is just simply incorrect. that's wrong. and it should not be an excuse or a reason for you to avoid getting immunization. the other is, and i've heard this recently because we've had this abundance of influenza vaccine relatively early, the question is it too early to get vaccinated? will protection last until february and march when influenza is usually most frequent? the answer is yes, your protection will last. and the consequences that you should get vaccinated right now, don't wait, run, get your vaccine.

now, i'd like to invite the past president of the american academy of pediatrics to talk about reducing the burden of this disease in children. jude yitsdz. >> good morning. on behalf of the american academy of pediatrics, i'm pleased to be here to talk about the importance of preventing influenza in children. immunizations are one of the greatest advances in modern medicine and it's critically important for children to be vaccinated against influenza. and in fact, even if they can't ask. while the universal recommendations we've been discussing may be new for many adults, we've had this recommendation in place for older children and even longer for children from six months through five years. while pediatric influenza rates have been rising, which is especially apparent last yoor, we still have a way to go. so why should we care about

influenza prevention for children? well, last year's influenza season was particularly tough on our nation's children. it claimed 1,300 young lives. who died. many of them were healthy children. that's a tragedy and it can be prevented. every year, children under five are at increased risk of hospitalization and complications from the flu. and all their school-aged children can get very sick and miss school, their extra curricular activities and sports event and the like. my own grandson was so sick last year before the flu vaccine was available that he could not walk but he had to scoot his way around our house. for that little baseball player, that was a real tragedy. he's fine now, thank god. another reason we need to care about vaccinating our children is because they are so efficient at spreading influenza to other family,

friends, and close contacts. like grandma. in fact, school outbreaks usually precede community outbreaks. if we see outbreaks in the schools, a community-wide outbreaks is not far behind. now that we have a unele recommendation in place, vaccination can and should be a family affair. pediatricians can play a critical role. in the recent consumer survey of mothers, nearly seven in ten mothers said that their children's' pediatrician was the first person they would turn to for information about influenza and vaccination. it's encouraging to learn that a high proporings of those mothers pold believed that annual influenza vaccination is as important as standard childhood health checks. the survey went on to reveal that mothers of children under six years old are more likely to have their children vaccinated than mothers of older children, particularly

those in the 12 to 17 year range. and that's the reason that we are concerned to get this information out about for pre-teens and teens. now, while i'm mentioning all of these ages, let me tell you about one that matters a lot. that's age nine. children under age nine who have never been vaccinated against influenza do need two doses about four weeks apart. all others only need one dose. the american academy of peedtrirks in collaboration with nfid childhood influenza coalition has issued new recommendations outlining who needs what and when, and that information is in an algo rhythm in your press kit. now, as a pediatrician, i can do a lot to ensure parents are educated of the importance of vaccinating children, but i would also like to call on our obgyn colleagues to help deliver the healthiest babies

possible to make sure pregnant women vaccinated. a pregnant woman is protecting herself and her developing fetus, and since babies under six months of age can't be vaccinated, it's important that those around them are. if you're pregnant or if you have close contact with pregnant women or infants, please get vaccinated to protect all around. now, today we have with us dr. laura riley from american college of obgyn and she can take some questions that are specific. the good news is that vaccination is now readily anle. children now can get vaccinated in offices, schools and centers. i'm now delighted to introdruse dr. foster who will talk about the growing role of community pharmacies. dr. foster. >> thank you, doctor. again, i am a professor and

vice chair at the university of tennessee pharmacy college. and took this, i'm also the american pharmacist association liaison member to the advisory committee on immunization practices. that's the reason i was asked to talk to you today. the american pharmacist association is very active in promoting vaccination and encourages consumers to consider pharmacies as sites for vaccinations. we encourage places like employer-run clinics, some specialty immunization clinics. identify seen at airports, at fire departmentses. so there are many locations. but pharmacy in general is the most accessible health care provider in the country. we have significant role in improving the health and taking a public health role in this field, and particularly with the new universal

recommendations there's a population out there between 19 and 49 of the healthy people that is recommended for that do not have a primary health care provider but i promise you they do walk into pharmacies. pharmacies, we have about 140,000 pharmacists trained to give vaccines, and i will tell you that in order for a pharmacist to do that we have to go through extensive training to do that. we primarily concentrate on adult and adolescent and in some cases adolescent vaccines. we try not to interfere with the pediatricians. we know they follow patients other than just give them vaccines. i will tell you that we have pharmacies in remote areas that do take care of pediatric vaccinations when there is a need. this year we began seeing signs in pharmacies around the country that they have flu vaccine available in aufplgt i'd like to point out, you cannot get this too early. last year pharmacists gave over

14 million doses of the seasonal and h1n1. and while we did not get the h1n1 vaccine until december, the c.d.c. did report that we gave over 10% of all doses for that and we're on track to exceed that number. in all 50 states, pharmacist ks vaccinate. there are different laws and regulations on what vaccines they can administer, what age groups, and also on what kind of services a lot of pharmacies have. you may be able to walk in, you may have to make an appointment. so what we encourage you to do is to talk to your pharmacist. interesting enough, october is american pharmacist month and the motto is know your medicines, know your pharmacists. we encourage you to talk to your pharmacist about the different laws within the state which allows vaccination, what the vaccine needs, vaccine concerns, about the value of vaccines, or just to walk in and get vaccinated. we also want patients to become

proactive with their health, because if we're going to reach our national goals, patients have to want to get vaccinated and we need to work on that a lot. whether patients are getting their vaccine's at a physician's office, at a workplace sponsored clinic, at one of the many pharmacies across the country or any other provider, one thing for certain, there is no excuse of inconvenience for getting a vaccine any more. pharmacists are now being recognized as one of the american's health providers. and with thousands across the country offering vaccinations, it is convenient, easy, and pharmacists are playing a key role in advocating and administering vaccines, influenza and the other vaccines. thank you. >> so ladies and gentlemen, thank you to all the presenters. and we would like to open this

now for your questions and the consequent answers. we'll also have some colleagues that are with us on the telephone and on line and occasionally we'll get questions from them. we'll have some roving microphones because this is being recorded we'd like you to use those. and if you would be so kind to identify yourself and your organization. we recognize also that dr. tom frieden's schedule is such that he has to leave us a bit early. so if you have questions particularly for dr. frieden, let's ask them early and you'll be able to get them answers. so the floor is open. >> thanks for taking my question. this is for dr. pal fri and dr. frieden if elled like to comment. could you comment a little on which of the vaccine on the thimesol issue. because parents are coming in

and break down which of those are appropriate and what doctors should be saying. >> well, as you know, there's no indication that thimesol cannot be used. so the families that do come in requesting a thimesol free vaccine can obtain it. but we have no reason to think that that's really a necessary thing to do. that there are thimesol-free vaccine preparations and parents can request them if they need to. >> and one of the things we might also say is for everyone two to 50, if they qualify for the nasal spray vaccine, that variety is also available and it does not contain that either. further questions. we have a question in the back on the phone.

>> this is a question for dr. shaff never or perhaps anybody else involved in the physician survey. can you go into more detail about the health care workers. where is the challenge if 95% of doctors are getting vaccinated, where is the challenge? what level of health care worker is weighing things down and what are we doing about that? >> well, of course the health care facilities, particularly large hospitals, contain personnel of all kinds, as i said, everyone from the security people at the front door and the people who valet your car all the way to the laboratoriens, people who work in the kitchen. all of them may not yet understand that we want to create a cocoon of protection for our patients when they and their families come to a medical center. so in addition to physicians and of course nurses and others who have direct contact with

parbletse, i think we have to work hard tore get the word out for everyone who is associated with health care in any way in any facility around the country, long-term care, assisted living, clinics, emergency rooms. we all have a personal and an ethical responsibility, a professional responsibility to be vaccinated so we don't put our patients at risk of acquiring influenza from us. none of us want to do that. >> could you and the other panelists perhaps owe pine on the good side and the bad side of making vaccination mandatory for health care workers? >> we know that if the health care worker is not vaccinated, they're more likely to become ill themselves, to spread it to coworkers, to their family, to their community and to their patients. so patients who are residents

of long-term care facilities, whose health care workers are not vaccinated, are more likely to get severely ill or die during flu season. we're encouraged by the progress we've seen increasing voluntary vaccination rate among health care workers and we're working hard with voluntary organizations as well as the cms to track what proportion of health care workers get vaccinated each year systemically. as we see that number, we'll go from year to year to see what's the most effective way to protect health care workers, their families, their communities and their patients. but i would say that every health care worker has a responsibility to protect their patients and that includes getting vaccinated. >> would you like to say a few words? >> sure. thank you very much. i think i can just echo exactly what you have said, all health care professionals have an ethical as well as professional responsibility to get vaccinated not only to protect

their patients but themselves and their families. so to follow on that, i think we're delighted to see the results of this survey that physicians are getting vaccinated in such high amounts, because they're the role models for the patients. and if they can role model and also recommend, we know that's the number one reason why patients get vaccinated. so we're delighted to see the results. and we urge our physicians to continue keep recommending and vaccinating the patients until the season is over, because that's still medically relevant. so thank you. >> thanks. we have another question in the back from the telephone. >> thanks for taking my question. and this is for dr. pal fri. she made a statement that children under age nine who have never been vaccinated need two doses and all others need one. but i understand that's not exactly true, and i have a

seven-year-old. so i'm really into this stuff. he didn't get two doses this year. need two doses of the seasonal vaccine i thought. even if they had two doses in a previous year? >> that's correct. and we have an algo rhythm that's available for making all those distinctions. thank you very much for bringing that up. it is -- that's correct. >> that's correct on the alga rhythm? >> yes. >> thank you very much. >> so there were populations that we try very hard especially to reach. dr. price. i wonder if we could give dr. price the microphone from the national medical association. perhaps you would like to say a few words about reaching the traditionally underserved population where we have disparities in acceptance of vaccines. >> thank you. because of the increased risk

of chronic disease, health disparities, and access to health care, the burden of influenza on those populations as well as the poor, rural communities, is extremely impactful. so innovative approaches as you heard from steven with respect to using the pharmacies, but also nontraditional venues in community-based organizations, faith-based organizations, schools, health centers, also in living projects. if we can increase the access to the vaccine for those individuals will do a better job in terms of bringing those numbers of vaccine coverage. this is an excellent public health strategy and it's causing the most. so we need to eradicate that. >> thank you. and we're also fortunate to have cheryl math yiss with us from the aarm. and so -- aarp. if you would say a few words of the population of your greatest

concern. >> our members are people 50 and over, and our younger members often have both children at home that they're caring for and parents that they take care of. so we like to emphasize to that cadre of our membership that it's important for them to get vaccinated in order to take care of their families. but in fact they are at higher risk. they are actually at a 15 times more people age 50 to 64 will die from influenza than younger people. and when you get to our members over 65, most of them have medicare, medicare provides the vaccine free of charge. and people who are 65 and over make up 90% of the deaths from flu. so it's really, really important for our older members to get the vaccine as well. >> thank you. questions from the audience? from the telephone line. apparently not.

so i would like to take a moment to ask dr. laura riley from the american college of obstetricians and ginecoljists to say a few words about the importance of immunizing particularly women who are pregnant and the fact that it's safe. >> i would be happy to speak to that. we are particularly hopeful that this year our vaccination rates of pregnant women will be as high or higher than last season. we found last season unfortunately that the death rate amongst pregnant women who got the flu was five times higher than nonpregnant individuals. that's quite a scary statistic. in addition those women were healthy pregnant women. so we're not talking about sick pregnant women. we're talking about healthy pregnant women who got the flu, as well as a high rate of hospitalization for respiratory illness. in addition, pregnant women who get influenza are also at high risk for pre-term delivery.

so this impacts not only the mother but in addition it impacts the baby. and one other thing is that as dr. pal fri had mentioned, if we are able to vaccinate pregnant women, we will be able to protect their newborns. so newborns can't get the vaccine, as you heard, the vaccine is not available for children less than six months. the only way to protect those newborns is to vaccinate the mother and to vaccinate everyone who is around the baby. so cocoons the baby is also particularly important. >> i'd like to emphasize that last point. so stay with me for just a moment. if you vaccinate a pregnant woman, she develops protection and some of that protection can pass across the placenta to the baby so that the baby when it's born has some of mom's protection. that carries the baby through that first six months before