not just something that that we can simply declare we're going to do. we have to resolve this in a way compatible with the rule will fall, with the judgments that the british courts are likely to come to, and with the strong opinions held by the judiciary in this country in their role of defending our fundamental rights, the role of law, and the independence of the court. we have to look at our international obligations. it will not be easy to produce a green paper, but that is the secret to getting back to resolving these matters at a decent pace. >> mr. speaker, you will know that my former constituent was held for many years in guantanamo bay, without charge. may i ask mr. secretary, if members of mi5 or mi6 are found

guilty of torture, what penalties will they face? >> i make clear that allegations in these cases are not that any member of the british security services had been directly involved in torture or treatment. the argument is complex at. they had no others doing this and they had been implicit, which is not admitted by these security services. no one has been accused of torture in. it would be a serious matter indeed if anybody in the british intelligence service was found to have tortured or found guilty of ill treatment of detainees. >> congress is out now for the thanksgiving break. when they return, they will focus on the ethics inquiry of congressman charles rangel. the full house will vote on

whether to approve sanctions. the senate is also out for the holiday. when they return work is expected on a food safety bill. both chambers are expected to return next monday, november 29. january marks the beginning of the 112th congress. the midterm elections will bring mix.ral new senators in thae bob portman replaces retiring senator george voinovich. richard blumenthal beat linda mcmahon. [captions copyright national

cable satellite corp. 2010] [captioning performed by national captioning institute] >> jeff bridges talks about his work to reduce youth under. john roberts and the role of the supreme court. later, lawyers discuss the impact of retiring justice john paul stevens. exceeding day on c-span. >> a discussion looking at the discussion of the constitutionality of the -frank- dodd reform act. it establishes new financial industry regulations. this is about an hour, 30

minutes. >> think you're much. we have a distinguished group of panelists today. the subject of this case, of this panel, is the dodd-frank bill and the constitutionality of financial regulation. if you like the size of the code of regulations before, you should be happy with this act. last week at stanford we had a conference regarding the constitutionality of the act,

and a professor from harvard this did -- lifted everyone's house spirits by informing by july, 2011, when the regulations are enacted, the act has 2300 pages. one professor former member of the obama administration claimed to have read this. the act identifies 243 areas of rule making for 14 to 15 agencies, some yet to be created, and he projected the regulations to add another 43,000 pages to the crf. as far as the motivation of the dodd-frank act, there are views that is -- that it serves an important function in that it creates an excuse for the regulators who fail to exercise

the power of the first time around. the act creates the opportunity to flesh out the 2300 pages by granting the administrators last discretion, which will be discussed today. we will also discuss the provisions of the act which allow the fdic to take over companies and the judicial review. to discuss these several issues, we have come and sit on my right, boyden gray, the former ambassador to the european union and former special envoy for eurasian energy policy. he served in a class as the former special envoy for the union. -- for the european union affairs during the administration of george h. w. bush. mr. gray was a partner for many

firm in washington and now heads his own. following his graduation with the university, he served with the u.s. marine corps, and then he clerked for earl warren. prof. ronald levin, a professor of washington university in st. louis. he was the 2000-2001 chair of the section of administrators locked in the practice of the american bar association. he served until 2010 as the adviser to the drafting commission to revise administrative procedure act. he served as the member of the ada stan in committee and as reporter on judicial review for

the aba. and to my left, only geographically, is peter wallison, who holds the chair in the financial policy studies and is co-director of a program on financial policy studies. before joining us, he practiced law at a firm in washington, d.c., and new york. mr. wallison has held a number of government positions. he was general counsel of the u.s. treasury department during 1986 and 1987, he served as white house counsel to president ronald reagan. he is also the author of a book about ronald reagan, published

in december, 2002, and available at amazon.com. to his left is a professor of law at the university of toward washington law school here in washington, d.c. he was a partner in another law firm. professor wilmarth is the author of a number of articles dealing with banking law and constitutional history, and he is the could-author of a book on corporate law. 2005 the american colleges of financial services lawyers awarded him a prize for the best article published in the field of consumer financial services wall during 2004. the format of today's presentation will be that we will go from right to left and the speakers will speak about 10

minutes on subjects of their choice, and then we will open up a panel to ask questions of each other, and maybe i will ask a question or two, and then we questioning the over to the public. mr. boyden gray. >> we decided on this side to do this cd. this does not prejudge what you do on your side, but we will do this. ron and i have been friends for a long time. we will disagree, but i could not have a better person to disagree with than ron, so we will start out by agreeing on seeding. when i was in europe i worried that if we did not watch out in this country the aggressive rulemaking coming out of brussels would to around the rule making here of

international nature of our global economy, and i used to mourn the judges that in five years they might not have a job. i was reminded of this this summer by the former chief judge who said, boyden, i have got a job for the rest of my le. meaning, referring to the health care and financial regulations that are going to be coming down the pike, that the judge referred to. presumably he will get his share of this. there's more than enough to go around for every circuit. the one word that characterize as this legislation's legal significance is "vague and s.." this is what greenspan pointed out, the paper which is available to everyone, so i will not go into detail. fayed this tends to connote --

vagueness fans to connote the first principle that comes to mind, it is true that -- and what the court has done since then is used a doctrine of constitutional of voidance at times to avoid the issue. the opinion of the american trucking points out that may be delegation problems will arise and the level of concern will be broader and the scope of the economy that is covered. i am not sure that that is here and left to overcome the reluctance on the part of the court did not the statute out on this ground. however, i think there are other grounds that are inescapable that could cause a court, the supreme court, to take a very careful look. we go for three titles that are

all related but by subject matter and by potential legal impact, and they do not all share the exact same provincial -- judicial provisions. the judicial authority is the most questionable and unique. they all share of more or less the same principles that i will run over quickly. one of the problems here is that whereas in a typical non delegation case, a very vague, the courts are there and able to construe the statute in a way that might avoid it. this is the frequently, as i said. it was done in the american trucking. in this case the court a possibility the issue interpretations the law is dramatically curtailed. in some cases, especially 202, courts are out of the jurisdictional -- altogether,

and ron is the expert here, but to me that says the usual chevron arguments may be off limits. you may be limited to a state farm review. is the opinion have any internal logic, but you cannot link it to what the statute might need. in addition, for example, the arbitrary review runs through all the provisions. in the resolution of party, it goes beyond that, and says the court has to deal with this, in 24 hours, and has to do so in secret if the received seized entity does not submit a bond fairly to it, and there are even criminal penalties for disclosing what might be happening behind closed doors. a that is a violation of the

first amendment. the penalty runs against the leader, not the leakee. i have not studied the aspect of that, that raises a question about the procedure. the standard says the bank pose a risk of fear, and does that failure pose a risk to the financial ability of the united states? the second finding seems to be the key one, but that is off limits under the section to limit the title. the courts may not be completely strip, but are compromised in their ability to construe statutes, and to add to that the congress is cut out, with the consumer bureau as title x, because the funding comes from the fed, and the preparation house committee on reportedly prevented from exercising

oversight review. i cannot see a sergeant at arms storming into the committee and shut down a hearing if someone raises dodd-frank acct, and i do not know how one congressman -- but that is the intent. under american trucking, agencies are not supposed to limit the extent of their authorization. then you have the executive branch. the white house is cut out of much of this. the consumer bureau, the director is independent of the white house, removable only by cause. independent of the fed that funds it. of course, beyond the review by the courts or the congress. the court review involved here an unusualit ais

provision. there are 18 consumers that she run by i.t. not know how many agencies. she has the authority to rewrite all the rules, and the courts must give deference. in some instances there is no oversight at all. for titlx ii, the damage to the financial system may have already been done. the new at all this up with no real clear dividing line between the branches as they might operate with the resolution of party or with the consumer protection bureau or with the financial stability board. many with common members, common

goals. you have what i worry about, the disappearance of the line between the government and the government. a line gets dropped out of the paper where the new york times describes a meeting of the government with wall street. the article says the most powerful executives in the industry did not go to the government. the government came to that. -- to them. this was in a secret nest in the willard hotel. i thought about this was the founders might have known about the willard hotel, i do not know if it was built then, but they might have known about some tavern in washington, d.c., and i do not think they would have

approved of this kind of gathering "in the nest." you worry about adam smith's warning, the observation of a government made up exclusively by merchants, is one of the worst governments of all. the obliteration of all these lines does pose a threat and seems to me that you have the kind of risk the vision to capture compromise that is to be avoided, the main reason for creating the separation of powers, dividing it up, to begin with, to get the power down to the lowest -- the exercise of power down to the lowest possible level. i do not know what is fight to happen, but lawyers are right to do well with this, so i am proud of the allied air. -- i am proud to be a lawyer. >> thank you. i appreciate the invitation to speak to the federalist society.

i have spoken a couple times at the national lawyers convention, and i find it a gratifying experience. it is always intimidating because i come here as a squishy pragmatist, liberal centrist cut, and then i am here in a room with people who all have a greater moral clarity than myself. it is a look like being a line and being thrown into a den of daniels. i am not here as a banker's expert, surely, but i know a few things about the non delegation doctrine, which i think it will be an important part of our discussion. you had your tables a short clippings which i wrote as the chair of -- in 2001, immediately before turning the reins of the section over two. and, so we have worked closely together for a long time. with pleasure.

in this column i spoke about that justice side of the american trucking case, and offered a suggestion -- that the non delegation doctrine be overruled and target, rendered nonjudiciable. i thought i would spend today giving a few reasons why a conserve the might be sympathetic to that point of view. let's start with the test to the constitution. i take that is what conservatives like to do. it provides that the legislative power invested in congress, but it does not have to be read as saying anything about allegations -- about delegations' legislative power. i read an article by a couple who were not considered liberal,

and the whole concept of the doctrine is a mistaken notion that somebody tried smiling -- smuggling into the constitution. it had a little play in 1935, and since then people have come to understand it just lost -- it just not belongs there, the exercise of giving power to an agency, not the dozen invasion of the display of a par. it is the creation of legislative authority, creating executive authority. executive authority is going to be exercised by passing rules, deciding cases, and we do not think of that as something giving away legislative power. it is e thing that the legislative was supposed to do under article ii. was them under the doctrine is that such exercise of power could be in valid if it does not have in it and intelligible principle to guide the agencies

and the courts. he did not get that from the text. maybe it was just a mistake and dell law has somehow been right for the last 70 years by not giving any forced to the alleged meditation on congress' power. you are thinking that is daunting the issue of concentrating huge amounts of authority in administrative hands and to cover a notion to get away from the real problem in the world, and i do not think that settles the question. we know that constitution should be understood and interpreted in light of modern realities and not just in terms of what people thought in terms of the 18th century. let's think about it as a current reality. the insuperable problem, with a judicially enforce non delegation doctrine, is the

difficulty and the possibility of drawing line between what is permitted and what is not permitted. the courts have repeatedly said we cannot do that. there is an article written not long ago by john manning at harvard, not considered a liberal, in which he describes the potential for a robust non delegation doctrine, and i know what when i see it standard, and if i can quote him, he writes, "when one asks whether a legislature has adopted a policy, the inquiry has a are retrieved feel to it, because there's no measure of how precision such an actor should be expected to apply. the courts can make rough judgments about how precise the statute is. they have no basis for determining precise insured be

in order to satisfy -- in order to make policy toward prescribed method." one might think that conservatives would be nervous about an open ended subjected chooses will test and at least a lot of times they think that is not the right way to set up a constitutional law, did just and i know it when i see it tends to decide when there is too much power. the courts as they have tried to face questions of non delegation, they are capable of drawing these lines and have had to look at the difficulty of deciding how much is too much. you have to take into account the difficulty of the subject matter as well as the difficulty of reaching agreement about it. financial regulation is a good example of that. with the caveat that i am not a banking law expert, certain things jump out at you.

this is a complicated matter. the aspects of the financial crisis that the congress undertook to deal with are many and varied. they wrote 2300 pages of a decision about it. i have heard two people argued that the law is to brief because they did not go into enough detail. i suppose they could have written 6400 pages instead. the courts recognize the reality, a finite time to deal with the issue, and doing nothing seemed not a credible option in terms of the greatest financial crisis since the great depression. in the time they have got, perhaps the most that you could expect would be agreement on some things. only 2300 pages worth of things, and then leaving some language they or open ended, and entrusting an agency with the job of coming -- of taking the

first out and filling in some of the gaps with the understanding that the and there will be opportunities for oversight and the action to get. i think the courts have understood that is probably what they have to do. of course, we are talking up only in the context of congress trying as hard as it can get it right and all working together to produce a harmonious whole. the congress we have however has of the difficulties these days. if you have a congress which there is a 60-vote filibuster role in the fact at that level, i am drifting toward my pandit mode -- pundit mode -- if you have a substantial caucused that are taking moves to prevent all and

only three crossed party lines, it will be difficult to write coherent law. if you have to scrounge for every vote, you have to take into account the idiosyncracies of every person who is a whole -- who is forming your collection. that is a formula for aggravated any problems that you might otherwise not have, in terms of getting a clear and coherent piece of legislation adopted. you can leave that last part out as a gratuitous stir. \ can get back to the congress that is working harmoniously to produce all. you still have problems that they cannot solve, and the nine delegation doctrine is administered in that light. the point i want to make, stripped of that, is that i

think you have to think about schemes of this kind as an unfolding story, something that unfolds by degrees, and the right way to think about the enabling legislation as the first stab, and then issues will rise. at that point, members of congress, the courts, the public will react against whatever solution the agency makes, and there will be questions of how to limit the power that has been conferred. i think really at that stage in the game boy and and i and everyone in between might come to same amount of agreement as to what the problems are, one abuses might have turned out to make -- to impede constructive solutions. when you look at the outset, there is all the difference in the world between looking at it in a positive light in terms of making it the best way it can

be, analyzing its and sibley to solve the problems, and be fair to all persons, basically the approach to interpretation that's just a supplier recommends in his book. on the other hand, there is the possibility of reading it as negatively as possible loan -- as possible with the idea of ditching it. >> thank you very much. perhaps another view, peter? >> i would love to have taken on ron's question, whether doing nothing was a credible option. >> i will get to that. >> i think it was the most credible option, at least when congress acts, they ought to know what they're doing and why they are doing it, and do not

think they had any studies to determine what caused the financial crisis. the ones that need they did require and the one that i have to have been engaged in, the commission is not to report to them until the middle of december, and it might have to extend its report until january because it is not ready yet. congress acted before finding out what actually caused the financial crisis. it is a legend but question whether congress did anything responsible here at all. i will now turn to the subject of what we're supposed to be talking about today, and that is the constitutional implications. i am i guess old-fashioned in the sense that i have always thought that the separation of powers was in the constitution as the founders' way of protecting individuals against the power of the government.

the idea there, i thought, and a constitutional lawyers could tell me something else, but i thought the idea of was that if the legislative body and the executive were separated and in fact in some kind of adversity, it would be a little bit better in protecting the individuals, people, and others within the united states against the power of the government. if they are united, as was true in parliamentary systems, that our constitution was developed from, the protection of the people, of the individuals, was less. we tend to focus on the bill of rights, which added to those, but we have to realize that my limited understanding is the

founders are originally adopted this structure as what they thought was going to be adequate for protecting individuals. what i thought i would do is having read what would in and john had done, the excellent piece of work, i would go through one element of this legislation, which i think does raise this question of whether congress can delegate of limited amounts of power to the executive branch and still stick within the constitutional limits or the structure of our constitution. i will focus on systemically important countries and talk to you about what is authorized

there, and we will give you the facts and you will decide he says that. that is the idea. i will leave these things out and you can decide whether or not you think this fits in with the constitutional scheme. we start with something called the financial stability oversight council, which is made up largely of all the regulators and headed by the secretary of the treasury. the secretary of the treasury because the secretary of the treasury is appointed by the present, reports directly to the president, one of the top offices of the exit of that branch. the term systemically important, which is what we are dealing with, firms that are systemically important, is the find in this way, and that is forms that could pose a threat to the financial stability of

the united states, either due to the potential of material financial distress or due to the company's ongoing activities. that is it. there really is not content in those terms. it provides auge amount of discretion to that body to determine whether a company is in fact a systemically important company. the statute is the city, in that -- in one respect, any bank holding company of $50 billion or more is in fact systemically important. no one question that that is not a proper delegation. they could do it in at least one way. then they go on to say, in addition, any kind of financial firm -- we will leave out the

question of financial firm, because that can have some content -- any kind of financial firm that might pose a danger to the stability because when it gets into financial distress or because of its ongoing activities can be considered systemic. what happens after that? those firms are turned over to regulation by the federal reserve. the federal reserve under those circumstances is required to in establish enhanced standards for capital, leveraged, liquidity, overall risk management requirements, and several other standards. in the end, the fed is told they may establish additional credentialed standards that they might deem appropriate. the fed can discriminate among

the firms that it rallied chelates based on their size, capital structure, financial activity, and in the other risk- related factor that the fed considers appropriate. with a finding by the fed and the fsoc, that a firm poses grave risk, the fed may take a number of an additional actions, including terminating the firm, closing it down, even if it is profitable. so, what does all this mean? let's put it in the context of what it is actually doing. the fed must do all these things for these systemically import firms, which include banks, bank holding companies, as i mentioned before, insurers, insurance companies, securities

perform -- securities firms, hedge funds, private equity, and any kind of firm that might be considered financial and systemically import. think about this -- these firms are all competing. they are all in the same financial services market. they are competing with one another daily. we leave out the policy question of whether that is a good idea for any one to be regulating them and whether a particular institution could have the expertise to be able to sort out all the questions that arise when all these different business models are competing, but just talking about the constitutional questions and the question of delegation. what this means in the fact is that the fed is managing the entire financial system of the

united states. even though all these firms are competing, they can direct one firm or one industry to hold more capital than the market would otherwise require them to hold. they can require it had less leverage than the market would ordinarily require it tell hold. every time they do something like that, disadvantages that industry, these of the all the other industries, that are competing with that industry. the fed has the ability here to complete control who succeeds and fails in the competition for the business of the consumer. i think what this does, at least to me, is raise the question, whether there is any content at all in the non delegation of harvick, because i will raise this question and i will ask ron to answer it -- not necessarily now, but at some point -- and that is, if

congress simply said, instead of it is almost 30 pages -- is actually several hundred pages -- that they had in the bill defining the activities of the fed in connection with these systemically important countries -- companies, if the congress had said the fed -- the federal reserve shop managed competition in the financial-services industry,. full stop, would that be an acceptable delegation of authority? if we have come to that, i think we are in serious trouble. they give. -- thank you. [applause] >> thank you, and it is a pleasure to be here. i appreciate the invitation.

i will take the liberty and say the constitutional issues surrounding the non delegation doctrine have been very well t eed up. i would like to address different questions. the question is for me, does the act accomplished the purposes that were set out before congress and that were announced as the reason why the act was passed. "the lesson is that the too big to fail problem must be solved." president obama said, " because of this wall, that people will not be asked to foot the bill for wall street mistakes. it will be no taxpayer-funded bailouts." i think it is certainly not true. the question is, why it was the to be to fail problem not solved?

there were problems on two sides of the ledger. peter has written eloquently that fannie mae and freddie mac were enormous to the problem. they were not addressed in the statute. the other part of the problem where the enormous complex financial institutions on wall street and elsewhere, the giant institutions, systemically important institutions, and in each case what he had was a tremendous exportation of public subsidies, and gross under capitalization for the rest being taken. fannie, freddie on their side, and the question is, does this act saba's basic problems the answer is, no, it does not. yes, there were supposed to be enhanced capital standards, but you have to be relying on the

same regulators who did not require a enough capital in the first place. when thing i found very shocking, peter was involved in the federal deposit insurance corp. improvement act of 1991, which meant it to become undercapitalized, regulators are supposed to crunched down on you. this was suspended because of the -- this was suspended implicitly for the top 19 firms. it is interesting that there is no such discretion. how can we be sure that capital will be required next time when it was not this time? what about that no bailout, the whole purpose is to set up an orderly liquidation of darby, which is supposed to mean no more bailouts.

the problem is i am not against the concept of the authority, but there are loopholes left open. they allow the fed to make broad-based liquidity programs available under its authority. one program that they used was the primary dealer credit a target, which was addressed to the top 20 financial institutions. there was no reason to stop them from using the primary dealer credit facility again. we were told this all solvent institutions. within a month, they had to infuse more capital into these banks, which proved not to be so

soft on. that is not a restriction either. they did not repeal the exemption under the federal deposit corporation act. this was supposed to guarantee assets against a loss for citigroup. it protected the authority of the shareholders and creditors. it's still has the borrowing credit for the -- the fdic can preferred certain classes of creditors over others and may have put out rulemaking saying that we will impose hair cut on long-term bond holders. complete silence as a short-term creditors of one year or less, which will have the perverse effect of more repossessions, or commercial paper, because

long term bond holders are facing some of the threat of her cats. one of the worst things is the fund which is supposed to pay for resolving these failures is not funded. there's not a dime. there's no money in that. the fdic has to borrow from the treasury to pay for the resolution. suppose they go back against the assets, maybe assessments can be made against cfi's, but these will be bridge loans from taxpayers. we do not operate with no money in the bank. we did not have enough this time. which at least had $50 billion. them torequire cfi's many insurance companies would operate on that kind of a basis. that fail will have

paid nothing into the fund and only the ones who are more prudent and less risk taking will be forced to pay anything afterwards. the act cannot stop congress from passing the son of tarp. we cannot shut these things down. we have to do open bank assistance. the trouble is the more loopholes there are unless you have any funds to deal with this about the more likely congress can be recorded into another tarp-type bailout. the question is, how can we stop this? i agree with peter that the first thing we better do in this congress is to address fannie and freddie. it seems to me in terms of the other cfi's, we have got to stop the subsidies that continued to flow to these

institutions. how? one thing would to be to increase capital, but that has not worked in the past. it seems to me that you start creating a meaningful pre-funded fund paid for by these institutions that they actually think they might put into the hospital because there is money to do it. third is to create some meaningful separation between the banks and their non-bank affiliate's, so they cannot use the's of funding, the lowest- cost funding. look at your bank statements. .01%, that is what you are getting under deposits? he cannot get cheaper funding than that. that is being used to fund the most speculative activities under existing rules. until you repeal the exception, you can have more citigroup asset guarantees. we can do a lot more to stop the

flow of subsidies across. if we do not, the same encouragement toward larger and larger and more complex and your institutions will continue. -- and fewer institutions will continue. i do not believe that bailouts will not continue. thank you very much. >> we start with the question that has already been put by peter to iran -- what is the federal -- to ron, the federal reserve shall manage all financial firms ? does that cause any non delegation problems? >> boyden gray and i have a colleague, and he tells the

story of speaking with a ferc commission aarhus said my problems with these simpler if congress would revise our statute to say section i, it shall be illegal, section 2, the commission shall the finance. [laughter] i guess on a policy level, i would prefer something closer to what we have because it gives people a structure, something to frame their arguments are around said that if there is debate and review, you have criteria to point to, and my sense is that courts do not do that terrible a job with other highly imprecise and vague mandate such as the public can be interested in necessity. so i would probably prefer that something more specific, but i

think my argument is, if congress were to adopt that, i do not think i would say it is unconstitutional. rather, i would say they would never do it and if they did it they would decide they did not like it and would change it thereafter because something would happen that they would not ke. just so that i can maintain some degree of consistency in my rhetorical position, i would say, yes, that is constitution al, but i am not that worried about it. >> again, i am not anything like a constitutional lawyer, but i have a question about whether there is dead in the separation between the set of branch and congress? >> yes, because congress adopted it, and it made the decision to give such power to the executive branch. now, i do not want to go into

it, but there is a distinction of separation of powers wall where a branch grants power for itself and where it gives away. where it grants power to itself, the scrutiny is it because that is highly suspect. when they had the decisions that they are going to and trust that power to another branch, where they can take it back, usually that survive constitutional review were successfully, but not always. those of you who know the line item veto case of recognize that there is a counterexample to that. by and large, because we have separation from the very fact that congress decided to give this money, this power to the excessive, can oversee it, rescinded if they do not like it, that ameliorates the separation of power. >> can i ask one further question, and that is, if congress said the exact that

branch shall exercise all legislative power that the congress was given by the constitution, would that be ok? hot >> no. [laughter] >> that is a reasoned analysis. [laughter] >> the question that peter posed, the language used is similar to the language that was at issue in another case, the national recovery act. it worked then but it did not seem to bother anybody since. the point i was trying to make is to deal with iron's back up -- we got these backups, the courts and the congress, that can check any overreach. the point i was trying to make,

congress already thought about that when they took all the power away from the courts, so they have no ability to check anything here, said he did not have the jurisdiction. and the congress does not have either, because the consumer board, the money comes from the fed. the congress is precluded from he winked of money that comes from the fed. there is no check, and that is what i see is the problem. it probably would be under the article iii, the most prominent line of cases where the courts have found it is a violation of article iii. somewhere i think they will act to the overture and a lack, total, almost total lack of democratic oversight. >> i wanted to let anybody know,

because mike lee speak at 2:00, we will break up at 10 minutes until 2:00, so you can get over there. to follow up, would you flesh out the actual step by step process which judicial review has in the district court when the fsoc boats by a two-story majority and this the the process and decides to put a non-bang financial firm into receivership -- what sort of protection does the firm have from -- is impossible to conceive, but may be arbitrary action by the administration? [laughter] >> the standard for title i for it being turned over to the

fed, arbitrary -- again, we can get into a discussion about this, he teaches this. currently i only teach part time. the case as it comes to the d.c. circuit, has to do, all of you are familiar with this, with chevron. how you interpret the statute? is it clear? is it not clear? that is statutory interpretation. then there is review which, for lack of a better way to describe it, it is state farm, the airbag case, where you look to see the internal logic of the reasoning, the agency's reasoning, in this case you cannot hide that reasoning to the statute. most cases that come up have to

do with, is that our retreat the persistence in light of the statute? for the seizure in the title ii, the authority which has not been discsed here, although that is the most egregious unilateral arbitrary potential for action, the trigger is whether a failing firm is a danger or a risk to the financial stability of the united states. that standard, which is supposed to cover the end of the been seized, is taken away from the courts to review. it has been precluded by the statute. it is bizarre, but there it is. that is a violation of article iii. >> how about the determination of where the the firm is close to default?

>> that can barely be reviewed. the district court has to resolve the resolution issue within 24 hours. can you imagine getting a judge up to speed in 24 hours? he is not going to get any sleep. then does the legislation provides that the district court or there cannot be a stay of seizure, pending judicial review. that is great. then if it is a non consentual seizure, it is secret. if somebody blinks what is going on behind closed doors, that is sent to imprisonment. this is the united states of america. >> i am trying to say this is the united states of america. when i read the provision that says you have to have the

decision in the district court within 24 hours, i thought that is completely nutty. if i take at face value of the argument and i see the statutory language that the court can only decide it is not constitution, that is also completely not be an unacceptable and un-american. let me try to speak out for our distinguished first branch of government, because on further consideration, there are proles some arguments that one can consider to offset the complete lunacy of what we have just heard about. on the 24-hour thing, that did seem not, but then i read in the section and look at the way in which the matter goes to the court of appeals.

it says the court of appeals shall expedite the appeal, but that is all it says. >> i would infer the district court decision is a nominal step and the real decision should be in the court of appeals. the 24 hour stop in a district court is probably just their poor some civil procedure reason. if they just said proceed to the court of appeals, people would say, "ok. that is all right." according to the statute, the review in the court of appeals is whether the secretary's decision was arbitrary. it is not reviewing the district court itself. it may be the case, and i am speculating, but for some reason they want the district court to be the first point of

call, but then it goes to the court of appeals and the supreme court. there are many administrative decisions appealed directly to the court of appeals. we have this stop by the district court for a way station. if you take that view, it does not seem quite as nutty as it would otherwise be if it was otherwise just a passing step and then the real action begins. with regard to the standard of review, it is totally counterintuitive to say that you would review arbitrary caprices but not ultra-constitutional. there are many statutes read aggressively or creatively to allow review of some issues. it is normally exactly the opposite. the court will review the constitutionality, but as for the arbitrary and capricious issue, that may be handed to the administrator. i would suppose that i will predict that courts will not

give it the interpretation that borden is giving it. i would suggest they will say you cannot even decide whether somebody is arbitrary and capricious as a reasonable interpretation of the statute without some concept of what you think the statute means. presumably, congress did not intend to bar us from considering the statutory issue here. one of the classic formulas of judicial review under the arbitrary and capricious clause is has congress considered the relevant factors and made clear judgment? relevant factors would be in the statute. you can work capriciousness in to encompass statutory factors, and i believe there would. it may not be the way to read the language, but i think that is the clear pattern of the case law, and in the american tradition, that is what they should do.

as for constitutional issues, it is made clear that only if congress says in the clearest language they want preclusion will they not hear constitutional issues. the constitution does say -- if it says in the clearest language you cannot do it, there will do it anyway. look at the guantanamo cases, for example. i agree with boyden that the vision he puts forward is a fearsome one, but i would be optimistic that we will not find ourselves there. >> the riders of the statute knew how to put it in accordance with law. they knew how to invoke chapter 7 entitled five. they knew all this stuff. they also knew what arbitrary -- if the court says that precludes our interpretation, they have said it is a violation of article 3. they're going to throw it out

and write it, which is fine with me. there were more explicit in saying whether the treasury's termination that it would cause adverse affect, which is the standard, the linchpin, is taken out of the review capacity it would be very helpful to put that back in. >> i think that is a different matter of whether it is appropriate for judicial review. i would like to hear from people who know more about banking and i do for that. >> where it came from is the bank receivership press office, that you can put a bank in receivership, but then there has to be a post receivership hearing to handle the takings related. if you look at those cases, they basically said that kind of ex

parke seizure and then whether that was wrong for, whether there should be compensation, based on the fact that the bank chose to be chartered by a government authority and chose to get fdic insurance, so there was a trade-off of benefits for your rights. you are now taking that model and pushing it around the entire holding company, a hedge fund that had nothing to do with it. >> you are also stretching it around people who do not own banks. certainly, the holding company's four banks and the non-bank people have not been chartered by the government and did not swap less rights for insurance. it will be interesting to see if the original model holds up quite as well when it is not a bank you are talking about. >> any other questions? i will throw the floor open to the public. >> one thing, ronald. we have a similar situation in

immigration law, saying it could not review any discretionary actions of the attorney general as far as maneuverability. then the real idea act came along in 2005 -- then the real id act came along in two dozen 5 and specifically exempted the ideas of statutory construction and constitutional right. that made an amendment to suggest to this act something like that. >> there is a microphone here, and we have opened up the session to people who would like to ask questions. if you can go to the microphone and state your name, affiliation, and question, you can ask the panel as a whole or any member of the panel. >> i find all of the discussions of the non-delegation doctrine particularly frightening and stimulating, perhaps

encouraging. i wonder whether we are barking up the wrong doctrine, or the wrong article of the constitution. what about the appointments clause problem? the president has the responsibility. there is a lot of power that has been delegated to the secretary of the treasury. the federal reserve -- this is not under the president's direction. while there may be cause for removal of authority, the intent of the removal of the design is to take power and authority away from the president and make it -- boyden talked about the lack of judicial review, but there is not any accountability by the president. any regulations issued by these independent authorities are not going to go to the white house or the office of management for budget review.

does that pose constitutional review is under the present article to authority? does it make any sense to take it out of the control, influence, and judgment of the president, who is after all supposed to be accountable? >> yes, alan. i think the director of the bureau is someone who is not going to be under the control of the president or the fed. so i think there is a real problem there. peter, why don't you take that. >> there are actually several problems with that. you pointed out one of them is not under the control of the president, appointed for a term. not under the control of the fed. the statute has specifically which that says the fed cannot have anything to do, really, with what the director of the cfpb does. the most wrecking thing is that

are not under control of congress either, to the appropriation authority, because they are given by statute 10% now and later 12% of the fed's operating cost to use, which comes out to around $600 million a year. remember what we have with the fed. the fed, first of all, is independent of congress, and does not get operating funds from congress anyway. for a good and sufficient reason, that was constitutionally challenged and held. now, we are taking another institution and grafting that on to the fed and giving them some of the appropriations the fed has for itself through its management of the monetary affairs. it does not get any by your leave from congress. the important thing to look at it seems to me is that the fed, independent as it is of all the

branches in a very informal sense, not formally so, but informally independent of the bridges, is at least made up of people who are appointed on a bipartisan basis in a collegial form, a commission-like form. here we have a single person who is inflated from control from anyone. in addition, this does not have constitutional applications, but it is amazg to me. if you look at the range and scope of this administrators' power, there is nothing that comes close to it that the government, even at the cabinet level, nowhere. what this person is able to do is to regulate not only the largest banks, but regulate the check cashing firms on the street corner in and the little town in the united states, everything from the top to bottom.

and everything in between. it is a remarkable thing. i can hardly believe it can to pass constitutional muster, but then again, it happened. >> there is also the provision which says about the budget -- it was a gratuitous big. -- dig. >> can i speak to that one comity 00? i appreciate the question. it would not be a federalist society meeting without a conversation on the unitary executive. i say that not in a snide way. now we have a new case. i am sure the separation of powers junkies in the audience are aware of the free enterprise fund case in which the supreme court held a public company accounting oversight board was unconstitutional because it had a double layer constitutional

protection, which is the numbers could be removed only by the fcc and fcc members could, it was assumed, although it is a poorly not true, could be removed from the president only for a cause. the court said that it's unconstitutional and we are going to sever the former of the constitution's so they are freely removable by the s.e.c., and that will fix them. in hoping that fixes it, the court has, without exactly coming out and said so, reaffirmed that case, and reaffirmed that one level of removal protection is ok. otherwise, you cannot say now it is fine. so i think that although the debate is eternal, especially in these auspices, and it is not going to stop here, the latest

word from the supreme court three months ago is that one level of removal protection for cause is constitutional. second, what else do we have? the appropriations committee are shut out of the action. i guess the nominal rules of congress are that appropriations committees are supposed to stay out of policy issues and just look at why is spending of money and the like. everybody knows that is not fully honored and appropriations committees to get into those issues anyway. but the idea that is in constitutional -- and themitutional la not to let do so strikes me as odd. that they kept this out of them is eyebrow raising, but probably not unconstitutional. the fed can approve them. there was a political compromise

regarding the consumer protection bureau. some wanted a fairly independent agency and some thought that would be dangerous and it had to be within the fed. we came up with this awkward compromise which i think probably somebody thinks is not awkward. will it be constitutionally ok to have it as just the garden variety independent agency? this halfway house probably is ok too. >> is it realla legitimate constitutional argument to say that the appropriations committees should not have any jurisdiction because they are just appropriations committees? congress -- >> congress has jurisdiction. the authorizing statute -- one of the powers given to congress, i thought in my old fashioned way about the constitution, one

of the powers given to congress as part of the whole separation of powers idea was that they had the power of the purse. that is maybe a little old fashioned right now. >> the do not have to exercise that power every time. to what i said before, they force for that power themselves. they could change the law and reassert it again. it is not a power grab. generally, separation of powers is more tolerant to people letting others do something then of seizing something that maybe you should not have. >> i cannot resist pointing this out in connection with what ron said. there is a marvelous dissent by boyer, who says under the reasoning of the court's opinion the fcc -- the s.e.c. is not an independent agency because it

was started in the gap between my ears and humphrey, when it was legal. the only we could argue congressional intent that it was to be independent was to argue that congress was going to do something that was illegal. it is fascinating. >> peter, on the appropriation, it is not merely a power, but the constitution prescribes that there should be no expenditure fund except pursuant to appropriation by congress. so really, it is an obligation to appropriate, as run indicates. congress can do it in different ways including standing appropriations, as we have done here. in the free enterprise case, while i agree with that analysis that there seems to be a blessing of humphries executors', the court did say

that notwithstanding the by theg relinquisheing executive for his authority, that it was still a responsibility of the supreme court to adjudicate whether the executive gave away too much authority. in that case, they cured it perhaps a little easily. they did know you cannot willingly relinquished it if the constitution once you to hold it. >> kai albrook, washington. congress chose to act before receiving a report on the causes of the crash. you have pointed out some of those, in addition to any and freddie, lying in the minimum percentage requirement? with regards to residential mortgages, particularly if there were sold into mortgage pools, and so forth. to what extent does this

legislation, if at all, remedy these structural policies which have been identified, or are we likely to just have another bubble of exactly the same kind, because the same forces will be at work again? >> a good question. do you want to take that on, arthur? >> i wrote that question. thank you very much. [laughter] someone has been reading what i have written. i appreciate it, thank you. i think my view is that congress did not at all address the real causes of the financial crisis. when i say this, this is my view, not necessarily the view of the fdic, which will have its report out in january. it may be different from mine. this is a really important fact about this legislation, it seems to me. i cannot make it into a

constitutional issue, but it is a really important fact that what i think can be demonstrated to have been the cause of the financial crisis, which is u.s. government housing policy, was not addressed at all in the legislation that was purportedly intended to deal with the financial crisis. >> anybody else on that? >> i would add i think the statute partially addressed some of the causes. there is a title toward the end on mortgage products. clearly, when you allow mortgages to be made based on the teaser rate, with no concern over whether the bar or could pay the fully amortized rate, that is a disaster waiting to happen. there is an attempt. whether it will be successful is to be seen. there was an attempt to get sounder mortgage funding. i think if we have learned anything is that sometimes it is

better to rent than to give somebody a mortgage that will essentially assured default and foreclosure. that is essentially what we were doing. of the not repeat what i said. to me, what drove the crisis beyond bad lending -- the bad lending came from, was really run from, funded by, these large to big to fail institutions. fannie and freddie on one side and the wall street firms competing with fannie and freddie on the other side. you either had not enough capital or you had all kinds of subsidies problems and moral hazard problems. i do not think we have even begun to deal with the too big to fail problem and the subsidy problems. i think it is at best a very partial inadequate response in those areas. >> to get into a little bit more

detail, there are 27 million subprimal and alt a loans outstanding. those are mortgages that failed when the bubble started to deflate. 19 million of the 27 million were the responsibility of the government through fannie mae and freddie mac or fha, and the banks that were required to make these loans on the community reinvestment act. were those issues dealt with in this legislation? the answer is no. arthur is correct that there is something in the bill that provides for a qualified residential mortgage, to be defined by the regulators. and to the extent that that is done, the private sector could securitized mortgages that are of a certain quality, high quality for some of it, if they

do not create the qualified residential mortgage. if there is not one that is being securitized, the private- sector has to have a retention of 5% of each mortgage to give them corporates him in the game. the fact is that over two- thirds of all mortgages that were made up to the time of the financial crisis, the crash, were made at the instance of and on by and responsibility of the u.s. government. when congress in the dog frank act -- dodd-frank act came to do with it, they exempted fha from this qualified residential mortgage. that means fha can continue to make crumby mortgages for which the u.s. taxpayer will altman to be responsible. >> on the issue of whether the dodd-frank bill zeroed in on the

causes of the financial crisis, if the study section 342 of the bill, which requires all the new to adoptcreated affirmative action programs regarding hires. next question. >> that was a brilliant lead into my question. i was also going to build on wallison'son's -- writings about the government hand in the crisis. you want about fannie and freddie years prior. since you are so prescient, build a little bit on what the speaker was asking at one of our panels yesterday. as we both know, the fed is enormously important and

powerful right now. they forced bankamerica to buy merrill lynch. they told city they could not buy wells. they are stage managing all this stuff behind the scenes. i personally think they're doing a pretty good job, although others can disagree. but your comment -- you made a number of lawyerly comments about what might happen in the face of this legislation and the big grab. but i am interested in focusing in on your thinking. is there something in particular you think will happen? not what they might do, but is there something you think that are likely to do that would be a misjudgment or something which should be concerned about? >> yes. [laughter] i can do that. actually, what worries me most of all about the fed powers, and at outlined in my remarks with enormous power they have over

all these very large institutions -- the thing that bothers me about this and worries me, having in my practice practiced before the fed for fat -- for bank holding companies, i can see the enormous power they have over the decisions that are made by these bank holding companies. you would say to your client, "wait a minute. the do not have the power to stop you from doing this. they do not have the power to compel you to do it." the client would say, "yes, but they are our regulator." that was the end of it. if we are not going to take them to court or refuse to comply with what they are requiring to do -- what we have here -- this is a prediction -- is that we are going to create a partnership between the government in the form of the fed and the major financial institutions in our country.

there will not be competing with one another so much as turning to the fed and asking, "by your leave, can i go into this business or that business? can i enter landing on the west coast -- landing on the west coast, where i would be competing with bank of america, or do i have to stay on the east coast?" that kind of thing will happen because the fed will have the ultimate control over all these institutions, and this is scary. today, they only have the power -- literally the power to regulate bank holding companies and some banks. in the future, there will have the power to regulate banks, bank holding companies, insurance companies, insurance holding companies, securities firms, hedge funds, you name it. it is a large financial institution, there will be able to regulate it and provide for everything that is at the heart

of the businesses of those companies, including their activities, because if the fed regards their activity as too risky, the fed can terminate that activity. this is a remarkable grant of power. ultimately, it turns those companies into tools of the fed. and that is why i have always called this act obamacare for the financial industry. >> i would add to -- [applause] i would add that you do not have to be good to be covered. there is an article in "the financial times" about this whole thing, about the big banks try to figure out who is going to get caught in the net. the hedge and equity funds are trying to figure out how they can escape the net since they have no insurance or fed window or any connection. then the "one of the bankers. during competition, the banker

said, "as many more financial institutions that can be brought here, the happier we are." >> a question for the panel, which is the creation of the consumer protection bureau already has some apparent loss, perhaps constitutionally flawed. but the administration chose to perhaps exacerbate those issues by instead of appointing a person who now leads it as the director, which is clearly required under the act, of creating a czar to run it. my question for the panel is this. what type of additional legal challenges could be expected for the consumer protection bureau, given the fact that she is already creating an

infrastructure and putting together things the director was required to do? >> if she actually starts to engage in rulemaking, an interesting thing to do, that i think would really be a violation. she was not confirmed by the united states senate to the job the statute does. she has been given a special assistant. she is noeven the "director." she would be asking for that authority issue started issuing rules. the clearing cause, the vacancy cause, lack of -- the clearing clause, the vacancy clause -- cuts on a more mundane level, it would be more the scope of her authority. there are certain and only the director can do under the statute. if she did some of those things,

that would probably occasion legal challenge. i cannot believe this was not thought about carefully. they came up with this very tortured compromise to not appointing the director, apparently as a concession. they also did not offer in the planning process -- they do not implicate legal rights and therefore trigger these potential challenges. but you can imagine, perhaps, crossing that line either inadvertently or more likely just daring to do it. i think it could probably be just a straightforward question of authority under the statute, rather than the larger constitutional issues. they might lurk in the background, to be sure. >> we have given you just about time to close, but i do want to leave you with this observation. with all the heavyweight legal talent we have not only here on the panel but in our room, i did

a google search last week and i found that the constitutionality of the dodd- frank bill has been challenged exactly once so far, in a lawsuit in knoxville, tennessee by a bank that says that the setting of debit fee charges under the act is unconstitutional. all of these questions still have to be sued on. [laughter] with that, we will move you. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] >> a look at programs c-span is adding on thursday. academy award winning actor jeff bridges talks about his work to reduce youth hunger. jane goodall on her love of nature and animals. chief justice john robert and

the role of the supreme court. later, lawyers discuss the retirement of justice john paul stevens. bill clinton presents the liberty award metal to tony blair. thanksgiving day on c-span. >> white house press secretary robert gibbs said today that the government's new airline security screening policy is trying to balance procedures that maximize security and minimize indecisiveness. he says the transportation security administration procedures will continue to evolve. this is almost an hour. >> to topics, please. on north korea, could you share the president's thoughts on the revelations of the facility? let us start with that. >> i am not going to get into -- into intelligence. i will just say that obviously

their claims, if true, contradict the pledges and commitments that they have made repeatedly to the international community. as you know, our representatives are traveling in the region right now. they will brief our partners and our allies in coordinating a policy response to their actions. >> you say if true. is it in doubt? >> i am not going to discuss intelligence accuracy. >> a lot of the parties involved are trying to get [unintelligible] does the white house think this threat is deepening? is this an example of that? >> for just a second -- i think the six party process, and the administration believes, the six party process can play an important role if and when the north koreans take that sixth

party process to move toward denuclearization seriously. we do not wish to talk simply for the sake of talking. north koreans have to be serious about living up to their obligations. not having done so has put a regime in place that is the strongest the country has ever faced. it has greatly increased the price of their noncompliance. what was your second? >> [unintelligible] >> i think the threat has always been serious. we have certainly taken it as such. we will continue to do so. that is why we went to -- why we went to the u.n. to get a stronger sanctions regime on their ability to move anything

out of their country that could do others harm. do others harm. >> on the screening process at airports -- does the white house have a position on the proposed action on wednesday? >> arkansas administrator addressed that in some issues on that this morning. i would remind people of a couple of things. first, i would point to what the president had to say on this saturday evening in lisbon. that is we put in place at hand security measures for the simple reason that for more than two decades al qaeda terrorists have sought to do us harm and have focused in on aviation and

airports. just in the past year, we have just in the past year, we have seen a christmas day attempt by mr. abdul to blow up an airplane using a device that as the president said was not picked up by a simple metal detector. in the past few weeks alone, we have seen an effort by al qaeda in the arabian peninsula to bring down an airplane using explosives in cargo. we must do everything that we can to protect the public. the president, as you heard him say a few days ago, in meeting with secretary napolitano and administrator pistole have said that our goal must be to maximize protection and minimize inconvenience. he asked them them and continues

to ask those that we do all that we can to protect the public and do so in a way that is the least inconvenient as possible. it is not an easy task. but we know that al qaeda, whatever intelligence of qaeda seeks to do harm through aviation security, through devices concealed on a body inside of the device one might take onto the airplane, or in luggage that is put on the airplane. our charge is to do all that we can to protect those who travel, but also to do so in a way that is minimally invasive. that is a balance that we will continue to search for.

think what is important is that this is a process that is based on intelligence and is based on feedback. it is and will continue to evolve and change. that is the nature of both the threat and the response to it. i think that you have been asked "will you take into account some concerns or complaints based on medical conditions, or how they feel personally about some of this." absolutely. we seek to maximize security and protection and minimize the evasiveness. -- in evasiveness. these are procedures that will continue to evolve. -- and minimize the

invasiveness. when we get onto an airplane, we need to feel reasonably sure we can travel safely. i think that is what the president, most of all around trouble for this thanksgiving holiday. >> what happened between sunday, when the head of the gsa seemed to be signalling no ground -- when the head of the tsa seemed to be signalling no ground, and monday morning, when he seemed to be signaling the need for flexibility? >> add do not think anything in particular happened. i think that when you look at what the president's charge has been in a flexible -- in a flexible and evolving security process is to insure exactly what i was told them. we put the utmost importance on protection, and to do so in a way -- have that carried out in

a way that is the least inconvenient for those that travel. the policy has to evolve. this is years ago, and when to use a couple of examples. eight -- a tsa screening, you did not have to take your shoes off. then somebody tried to use their shoes. now we have move to something where there was a device that walked through a metal detector. the metal detector is not going to go off. because of that, we moved to advanced imaging technology, ait, to provide security screeners with a better opportunity to detect whether or not somebody is trying to

smuggle something concealed on themselves, concealed in what would be a normal device or in their luggage. >> i also wanted to ask about start. do you feel you have answered senator kyl? concerns -- you feel it has just become a political disagreement? >> we take everyone at their word that they are doing everything they can to protect the country. the president spoke to senator kyle last week. >> was that before or after? >> after. the vice president continues to speak with senators from both sides of the aisle to try to move this process forward. if senator kyle has questions, we are happy to address them and to meet them.

that is what -- that is an important thing to do in this process. i think it is important if you look at the series and range of statements we heard over the course of the weekend from the military, from those retired in the military had operational roles in our nuclear security. hearing from our allie in nato, and particularly of our allies in eastern europe, those closest to russia and the old soviet union, in saying clearly that ratification of this treaty is in their best interest and our best interest, and getting it done quickly. that is a thick a tremendously important endorsement for those efforts in curtailing the number of deploy nuclear weapons --

deployed at nuclear weapons, and insuring an inspection regime. >> on the tse rules, when secretary clinton was asked whether she would submit to those, she laughed and said she would not want to. how can you ask the rest of the public to follow through on these laws when a senior administration official says she would not do it? >> when you look at the course of her interviews, i think she also says that i think we would all love to live in a world and exist in a place where none of this is required. but as she said, we do not have that luxury. as i said earlier, we have known for two decades that al qaeda interests have sought to do harm using an airplane inside

the room of aviation. first and foremost, to avoid something like that, one should go through the ait. one should go to that screening device in order to -- i think what she was saying was that if you look at -- we live in a world where of course nobody would want to -- it would be nice to live in a world where none of that was necessary. but just less than a year ago, we know that somebody got on an airplane with the intent of blowing it up using a device that would not have been picked up by a metal detector. and that is cause for quite a bit of security concerns. >> regulations are so important now. why did it take nearly a year to put this system in place? why didn't it happen last

christmas? >> there are a series of procedures that have been phased in. advanced imaging technology. i believe we have that at 65 airports throughout the country. there has been a process for the construction and procurement of those machines. but it was not going to happen overnight. -- that as 's as the security system involving pat downs has evolved, it is not something that just darted a week or so ago. this is something that has been phased in over a series of time. >> on north korea, officials like secretary gates have said they knew correa enriched uranium but did not know about the specific facilities. is that a failure of u.s. intelligence that it took the north koreans to tell the u.s.?

>> i am not discussing the intelligence on that. >> with some of the security measures being taken, nearly half the public says that are concerned of the halt -- the health risks possible with the new scanners. the administration position is there are no health risks. >> the administration's position is based on sdies through the fda and others that the imaging technology provides so little in terms of -- you are exposed -- the truth is you have greater exposure -- exposure just sitting in an airplane than going through one of these machines. >> why has the administration failed to convince so many members of the public there are no health concerns about these new scanners? >> i have not seen a poll. >> there are a lot of people --

>> let me try to find this in my paper here. i have cut some and i think i can talk to you about on that. >> the other question i have, also on the tsa, is that the public do care about security. but when there is an intrusion in privacy, they want to see it targeted in justified. you spend a lot of time on the internet and spend a great deal of time watching cable. >> you might presume, but i will accept the premise. >> are you confident that the tsa intrusion on people's privacy has been targeted and justified? >> we are used to the understanding of a profile that looks at a range of people, for instance, 18 to 35.

but just in the past year, we know of people that have been arrested in this country for terrorism that would not fit into the range of those ages. right? we know specifically that a uap was targeting somebody that did not have the characteristics that those previously that have attempted to do us harm through an airliner -- that they shared. we know that they are continually looking for ways, and i think the cargo example is a very good one -- of ways in which they can take something that looks normal, or a situation that appears not out of the ordinary -- to augment

that in a way that gets passed security -- past security and does as harm. i think what we think of as these are the characteristics of what might happen -- understand that we have seen and that we know about very specific efforts to find people outside of what security might normally be conditioned to look for. right? we know that -- i do not think it is an accident that a uap was seeking to, through concealing this device on him, get onto a plane something that was not going to be in a metal detector that would be delivered by somebody who would not normally be seen as somebody associated or affiliated with a qap in an

effort to get around what you would normally be constructed in a profile. i think it is important that our -- i go back again to what i said. that in and of itself provides the foundation and basis for how security policy and screening has to evolve. because the nature of whatever the threat is today is going to be different in three to six months, because they are going to be trying to find different ways around what has been set up. and i think that goes back again to what secretary of state clinton said. we would love, and the president said this -- we have an apparatus now that reaches in going into buildings are getting into their plans that do not exist. we have to get back to world --

we cannot get back to the world in which none of that does exist. we have to meet the threat which is out there. >> to president is a father. there are a lot of parents out there whose children have been subjected to putdowns. they have been very upset by it. there have been individuals with medical conditions that have been forced into humiliated position. >> it is important to understand that anybody who goes -- anybody under 12 goes to something much more modified. for most, if the tsa administrator was in here, he would say this to you as well. has all this been done perfectly? no. if somebody feels as if they have been unduly subjected to something that they find to be far more invasive than the line

of convenience and security, they should speak to a representative at the airport. again, without leaning too far into this, i think it is important that it is not out of the realm of possibility to think that -- i am trying to be somewhat careful, here -- that those that wish to do people harm in an airplane have looked at some of the ways through explosives, devices,, luggage, and themselves, that we know can get around and through security. and we have to be careful about that. i think we are trying and tsa is trying desperately to strike that balance. that will evolve. again, the evolution of the security will be done with the

input of those that go through the security. i think it is important to understand since the more stepped up putdown process has taken place, approximately 34 million people have been through the tsa system. i think the figure that i have seen is that about 1% of those that have gone to the process have gone through -- through the overall screening process have gone through this more stepped up procedure. >> thanks, robert. during the time between the time the administrator made the comments that sounded like there was no give at all and later making clear there was going to have to be some flexibility here, were there any conversations with him by anybody at the white house backs >> i am sure people at the white house speak to the tsa constantly on security.

>> on that topic, about whether there should be some flexibility. >> i think what the president said on saturday was that he communicated that to tsa and dhs several weeks ago. >> i am talking about between the comments. >> i do not keep track of every conversation, but i assume that people here have constantly been in touch with them. sure. >> i am asking about specifically with regard to the inflexibility he suggested in the comment. did somebody call him and said that is not -- >> i do not know every conversation that happens with every person here. if you are asking me if people are constantly in touch with and talk to -- >> i am asking you -- >> i am a knowledge and that i am sure. >> about the particular. >> i am not sure. i do not know every conversation. i have not talked to a tsa

administrator. >> i am reluctant to get graphic, but everybody knows there are theoretical possibilities with body cavities. why respond specifically to what he did with searches in that particular area when there are so many other possibilities out there that i do not think anybody agrees you would actually subject people to? >> i think that -- let us take this much broader. i think that, again -- and i think you have seen the progression in screening writ large. we all remember you put your stuff on the x-ray machine, you walk through and get the bag. you have seen the evolution of something that is going to detect something that is metal. again, if you look at the evolution of security, of plots, and attempts, now you have got

goes, -- shoes, liquids, again based on specific attempts to use those very devices to do harm. and again, the transition to and ait, which gives you the ability to detect something that might be on someone hoping to do harm but not something that is metal. >> with the conflicts on tax cuts, you said the vice president is working the phones on start. is the president or anybody at eye level in the administration doing the same thing on tax cuts? >> i have not -- i am sure that others are discussing issues like taxes that will be dealt with in the lame duck.

the president, to my knowledge, has not, other than the meeting last month, made calls. >> can i just do one more on the millionaires' tax? there is a group of millionaires saying they do not want to extend tax cuts for millionaires. they say it is their patriotic duty. what does the president think about that? the patriotic campaign to pay more taxes. >> although i would love to be the spokesperson for that, i bet -- that is a good good. -- good gig. i know he is slightly above the millionaire threshold. i do not necessarily have anything to add on that except i think you have seen or heard from -- again, using mr. buffett as an example, mr. buffett is

somebody whose marginal tax rate, based on where he derives his income, is, as a thing he said before, a rate that is far less than that of, presumably, his spokesperson, although he is a spokesperson -- than his secretary. he derives a vast majority of his income from investments rather than from his paycheck. i will come back over there. >> not just in light of the galotti -- [laughter] >> was that you, lynn? >> in light of the election early this month, he said in his way he thinks it is impossible

the congress is going to approve the money for at guantanamo bay detainees. are you basically willing to give up on that idea? >> i said something different last week. we have spent the first row here talking about al qaeda. we know al qaeda uses the prison at guantanamo bay as a recruiting effort to seek those -- the participation of those interested in doing us harm because of that. i think to give up on that -- we are not giving up on that goal. >> it is almost two years into the president's administration but you of not been able to close it. can you commit to closing it in 2011? >> i will commit to closing it as soon as possible. >> can you put a time from on that? >> i think i said last week that no one expects this to be easy.

but i know the president has not and will not give upper on the goal. >> this is on start -- is the administration willing to handle the entire record? there is a new republican senator coming in who has quite a shopping list of things he starts before he can even think about this negotiation of the treaty. all classified briefings -- >> of the russian resale? >> with the u.s.-russian missil defense -- this is according to "foreign-policy." he wants a whole written analysis of u.s strategic command information that supports the treaty, the planning documents, a formal briefing, will the white house

possibly be able to accommodate -- >> not knowing specifically -- i would have to have somebody look at this technical list, but i think a lot of what the senator elected is looking for in way of the documentation and a briefing, i don't know if some of that has been asked and answered. we will certainly provide that documentation to him. i think a discussion with somebody like general car ride on missile defense for others at a classified level, those are conversations currently being had with the senator's right now. if there is information we have that could help answer those questions, we would be more than

happy to provide those information -- provide that information and those documents to the central act or anyone else in order to demonstrate -- general cartwright would tell them this has no affect on our ability to conduct our own missile defense activity. i think a good example of that is nato agreeing to the president's approach to protect europe at a meeting that saw the russians a ultimately participate in and at the same time, they are arguing people -- are arguing for ratification of the treaty. i don't know if the senator a lack has talked to anyone on the national security staff here. but i don't think there's any doubt the folks here will reach out rather quickly to provide

information he thinks is necessary. >> is it true that various administrations -- various officials in the administration refused to turn over the records? >> i'm not familiar with each and every aspect. i'm happy to ask whether that is the case. i think three of the best spokespeople for our defense posture as relates to this treaty are the secretary of defense, the chairman of the joint chiefs of staff and the vice-chairman of the joint chiefs of staff. he is the missile expert in that realm. all of the very good spokespeople for how this enhances our security and protection rather than the opposite.

>> on north korea, you mentioned this latest regime of u.s. sanctions are among the strongest of -- is there a concern that sanctions have not worked well enough to prevent this facility from being built? >> without getting into the timing, the sanctions that were put on north korea and hinders its ability to move product outside the country date back to some time bit last year. -- some time to mid last year. that was in direct response to the testing of a long-range missile in late march, early april, i forget the exact date.

i think you could go back many, many years to the north koreans walking away from their obligations in 6 party talks in discussions with their neighbors and partners and allies and flaunting those international standards. we have been aware of that for quite some time. >> are you saying this came rather quickly in the last couple of years? >> i'm not going to get into the specifics of what is in the intelligence. the sanctions based off of what the un did last year do not add up. >> quickly on start, he said the midterms show the american public wants democrats and republicans to work together. given that, why not be more direct in accusing the --

accusing senator kyl of playing politics -- >> the president said we live in an atmosphere of -- in this town that normally, if one side wants to do something, then the other side does not want to do something. given who you have seen in terms of elevators and supporters of this treaty, that does not fit the mold of what we normally see in a political issue. we don't think it should fit that mold, given to those supporters are. we think this is something that can and should get done over the course of the next several weeks and certainly before the end of the year. >> senator simpson from the deficit commission has been a colorful about a fight to raise the debt limit. he says there will be a big fight and all the hair and eye

balls all over the floor. are you guys concerned that tea party voters will stand in the way? are you concerned the new republicans will stand in the way of raising the debt limit? >> i think we have a ways to go before we get to this situation and the scene former senator simpson describes. i would point you to let the incoming house speaker says last week -- is an issue we will have to deal with and we will have to deal with it, i think his words were, as adults. we understand we did not get into a debt crisis in the last year or two. this is something that has built up for many, many, many years. we have to put ourselves back on a path of some fiscal

sustainability. >> you did not answer the basic question -- somebody hiding something in a body cavity -- >> you have to understand that -- let me give the two dancers -- i think it is safe to say that as the threat has evolved, our screening process has had to and has evolved. i think you can understand why i would not want to get into the intricacies of exactly what would be detected, how and when, because we do know those that want to get around those procedures watch what is we do and what we say. >> are you saying that hiding something in your body cavity can be detected? >> and saying that to address the most up-to-date possible, we have instituted the very best in

technology and screening efforts in order to detect that threat. >> what is wrong with the israeli system? >> i would point out that the israelis have to airports or two international airports. i think that's right. in tel aviv -- we have 450. in tel aviv -- we have 450. there is a scale -- i have watched and read the stories of can't you just do -- understanding the scale involved is infinitely different. different. >> next week, the president that commission is due to reach its conclusions. does the president have anything

planned to try to pick up the ball from where they leave off? >> i don't know the process to answer that, but i can go back and check. >> on start, the president and senator dick lugar have said of the street gets to the floor of the senate, it will pass. what kind of conversations are going on between president obama and harry reid to make that happen? it is ultimately harry reid that will schedule that. >> this is a priority of the administration. it was a topic that came up in conversations between staff here and the majority leader staff and conversations directly with the majority leader. >> it is it worse for

international relations to see this go to the floor and failed and to see it not go to the floor at all? >> for us not to get this done is, as you have seen, not just in our administration, but throughout the weekend at nato, its impact on our security. i make mention of this again -- the border -- that easternmost border with russia, those countries believe this has to get done as urgently as we do. i think that's an overwhelming endorsement for why delay on this does not make a lot of sense. >> the news of the irish bailout sparked a short-lived rally in the market this

morning. how concerned is the president about the effects of the bailout on the u.s. and global markets? >> we welcome ireland's intention to seek that assistance and for europe to deal with the crisis that affects those countries. we have certainly made mention of that here, the impact of greece on our recovery and acting quickly to deal with problems in ireland by the europeans is good news. >> do you think the bailout will stem the tide of other problems in the eurozone? >> i am not a eurozone expert. addressing these causes and concerns quickly is a good step. >> on wednesday, the president

pardoned another couple of turkeys. are there any people pardons in the pipeline? [laughter] >> i will check with counsel to see the degree to which, what the process for active pdons in the administration. >> [unintelligible] >> [unintelligible] >> is the at a--- is the irish bailout coming up in the daily briefings? how closely does the president monitor that situation? >> there was an economic daily briefing today and i know it has come up in the past. it has been part of his briefings. >> is there concern about

portugal at this point? >> i would point you -- mostly the briefings have focused primarily on ireland and some on portugal. that the extent i can recall. >> will meet president be speaking at the chamber of commerce in the next few months and what is he doing to reach out to the business community? >> in terms of the second part, i would point you to the first several days in india. in terms of the invitations from the chamber, we are and continue to be interested in speaking with them and their members and we will see if the schedule allows for that in the beginning of the year. i know they are originally had an event for early december that

i think has been rescheduled to sometime in january. >> the president learned about these tsa procedures several weeks ago and raised the concern at time. have you personally gone through these machines or the pat down? >> i think i have been through and ait -- most of my travel is on air force one. i travel to and from atlanta up a few weeks ago and i thought i went through one of them. >> [unintelligible] is this a way of showing love

for chrysler after having lavished on gm last week? >> this is a particular plant in kokomo that, because of some of the restructuring and some of the funding for retooling and modernization is a transmission plant that is able to retain more than a thousand workers rather than seeing it plants shuttered. shuttered. we have been too and we continue to go to chrysler, gm, and ford facilities, a company that did not have to receive restructuring help. if you look at some of these plants located throughout the country, particularly in the midwest, and kokomo is a good example of a place that's very

dependent upon the types of jobs for its economic livelihood. i think that is important and the president's is proud of our efforts to ensure, whether it is a thousand people there or a million people throughout the country whose jobs were saved as part of that restructuring, understanding that restructuring was about making some difficult choices. some plants were closed. there were some corporate restructuring, particularly at general motors, to get both of these companies point in the right direction. >> what particularly in terms of stimulus does the president think he can get out of the lame-duck session of congress?

is the to do list getting shorter and shorter? shorter and shorter? >> we talked a little bit about this last week. i don't think many people believe the week we came back, basically last week, we knew this week was largely held off for thanksgiving and they will be back again a week from today. i don't think many people leave that first week back is going to be a period in which a lot of lot -- a lot of legislative business will be gone through. it is traditionally an orientation and caucus organizing process on both sides of the aisle. you have members and senators who are leaving and new members and senators coming in. >> my question is more on what you are actually going to get done.

>> i think you know, if about mistaking -- if i'm not mistaken, that we did -- that meeting is happening a week from tomorrow. moving a meeting from one week to next does not stymie our plans. this is not a totally exhaustive list because my memory is not what used to be, even from this morning. there is no doubt, as you heard the president say, we have to deal with issues around taxes. we're going to have to deal with issues around unemployment insurance and compensation as well. you have heard the president make mention of start and that is something that is crucially important. to our national security and foreign relations.

there are issues around don't ask, don't tell that the president and many people believe are best dealt with through a legislative process and not through a legal system. and not through a legal system. there are priorities such as the dream act, -- and probably leaving out more than i'm mentioning, but there's no doubt we have a lot of work to do and we have a lot time to do it. >> [unintelligible] >> i think the original date was december 1st. the report is being released today or so early in order to have some informal hearings on the survey and its results. i think those hearings start on

the first. his is important, if you look at what others have said, particularly secretary gates, we can do this legislatively. the house has done this in the senate can do it. do this legislatively college provided at a to implement the policy. court doing this is not likely to provide the pentagon and others with a pathway for doing this. in order to do this in a way the president and others want to see, doing this legislatively is the best way of doing this. >> there is such a focus on security at airports and you talk about terrorists using airlines, but what about this

country's way of life? we saw in london -- what about their rail system here? >> without getting into detail about what is out there, let me say this -- to present only aviation security is a priority is not the case. there is passenger rail, cargo rail, a also asked -- a whole host of different ways of terror can be brought to this country. aviation is not the only thing we are concerned about. if i am recalling correctly, the plot that wa planned dealt specifically with some aspects of transportation beyond that of airports. the only reason i mention

airports as we know for quite a long time that this has been a focus of al qaeda and its affiliates. affiliates. >> [inaudible] is there any push back from amtrak to try to work something out? >> i don't have a lot of this stuff in front of me, but i can assure you and i would contact both dhs and amtrak to talk to our regional, transcontinental passenger rail. >> [inaudible] are we expecting to hear names being dropped and are you going

to stand at that podium much longer? >> i'm going to be here to answer a few more questions. [crosstalk] [crosstalk] let me answer the question that has been posed to me. in terms of the reorganization, that is something the chief of staff, the president and others are continuing to work on. ito heavy toll much for with any of those announcements would be made. >> what about you? >> i have spent very little time working on that. >> about a week ago, a freshman

republican congressman from maryland stood up at a benefit session in the house and complained about the time it would take for his government subsidized health insurance to kick in. is there some element of irony there? iter a call for those who want to repeal the health care law to renounce their health- insurance? >> i think there seems to be an element of understanding the role health insurance plays in securing families regardless of their economic lot in life. make a blanketo statement about what the congressman elect should do, but i would say i think it's

probably a pretty good demonstration of the fact that their rhetoric of what people say either throughout political debates or in campaigns and the reality of how something like that impact their lives is apparently quite different just in this example alone. reconcile to have to with himself the notion of health care that is subsidized the american people and his statements surrounding that. it presents a particularly interesting dilemma for the as have castigated that in the past. >> do you think it's hypocritical?

>> i would agree with you and i think you think it is. then don't ask, don't tell, remaining three service chiefs are on record saying they want to wait for the report to come out. [inaudible] >> i think the service chiefs are meeting with the chair of the joint chiefs and the secretary as we get closer to this report coming out in order to discuss where they are based on that survey. the president has not yet seen that survey, so i don't want to presume whether based on those results that would change their opinion or not. i think it's best not to get too far down the road on commenting on that until we get a chance --

>> you say the president wants to work with military leaders to get them on board with repeal, so what is the point is not to get their support? >> i think the original question you asked is will that report change their mind? i have not seen the report, the president has not seen the report and neither of us have had a chance to talk to the chiefs. that's not to say whether or not whether you have unanimous agreement or not that -- the presidents hasn't -- has no where people have stood on this policy for as long as he has supported changing the policy. it will be important to view the attitudes, and to use those

attitudes to craft a pathway to implementing a changed legislative policy. that is what the president has advocated through this process. we may have a better sense of that when we get an opportunity to talk to those of see the to talk to those of see the report >> [unintelligible] >> it president has spoken previously with the service chiefs on this subject. he will have the opportunity to speak directly with the vice chair and the service chiefs as this process moves forward. thank you.

>> president obama and vice- president joe biden will travel to kokomo, indiana as part of the white house to main street or whether they will visit the chrysler transmission plant. the white house says kokomo has been devastated by plant closings and layoffs this year but administration efforts and its restructuring of the auto industry are helping the city turnaround. >> here are some programs c-span is airing thursday, starting at 10:00. jeff bridges talks led his work to reduce use under. jane goodall on her love of animals. chief justice robert of the role of the supreme court. and lawyers discuss the retirement of john paul stevens. for president bill clinton presents the liberty award metal to tony blair. that's things giving day on c- span.

>> at today's state department briefing, the spokesman talked about reports north korea has built a nuclear in treatment facility. a group of scientists recently returned from a tour of the facility. this part of the briefing is just under 30 minutes. >> they will be in beijing tomorrow before returning to the united states. obviously, north korea's claimed to have a uranium enrichment program, if true, contradicted some pledges and commitments and violates its international obligation and reinforces our longstanding concern about birth korea's clandestine uranium enrichment activities.

we will not be drawn into rewarding north korea for bad behavior. they frequently anticipate doing something outrageous or provocative, forcing us to jump through hoops and we're not going to buy into this cycle. as the ambassador said, this is an issue of concern, not a crisis. we're going to consult their partners and court made a unified response to north korea's actions. >> what does this say about the last two years of u.s. policy about north korea that they have managed to construct this facility? why do you keep saying if true? do you think what they were shown was a patinkin village type thing? >> we don't know. -- pat him again and village

type thing. >> we will continue our conversations and try to understand what they were shown and what the potential implications are. they were given a brief glimpse at a capability and we're going to assess exactly what we believe that capability represents. north korea says it is about enriching leu for a civilian power plants. as secretary gates has said, he is highly skeptical of that claim. we're going to take our time and work through the information available to us. certainly, this does not surprise us. going back many years, we have had strong suspicions of a clandestine enrichment capability or north korea's pursuit of that capability. we will review the implications

of this information. >> whatoes it mean for the policy? >> it validates the concerns we have had all along. >> some say it invalidates policy because it calls into question whether what you were doing was in fact the right thing. >> we have had a long list of concerns about north korea and this potentially adds one more concern to that list. north korea has nuclear programs. north korea has, for a number of years, we believe looking into developing the capability. this is not new. as the ambassador said, it is

not a surprise. but it is clearly a violation of north korea's international obligations, of its combatant, and it remains our view that north korea must take complete, verifiable, and irreversible steps toward denuclearization. we will consult with our partners on the way forward. >> can you talk about the timing and what happened after he left when he presented you with the added illustration -- when the decision was made to send him? when the sigh of relief was when you realized it was thanksgiving weekend you would be able to make the trip?

>> we have met with the various individuals and we have gone to pyongyang and a private capacity and there will be further meetings as we pursue this information. >> where do you think north korea acquired the technology, which i am told included not only centrifuges, but modern things like flat screen computer displays? >> we are still assessing exactly the information they brought back. we do not believe they have acquired any nuclear technology.

the passage of the resolution last summer, beyond that, anything i say at this point would be speculation. we have no information have acquired any -- >> your ignorance is not a guarantee they have not acquired it, it just means you don't know. >> as you know, a lot of the information we have of this comes from intelligence sources. and does not going to go down that road. >> in regard to this, how effective is your call at your sanctions regime been, given regardless of what was before or after 1874? they appear to have managed to attain hundreds and hundreds of the centrifuges? >> we are going to go through our own assessment and compare

it to information we have through other sources. we're not going to pass judgment about the implications until we have done a thorough review and come to a conclusion about the best of what has been seen. it has been no secret that north korea has been interested in and actively pursuing an enrichment capability. we will assess exactly where we think they are and what stage they are in. >> you opened by using a line that has been used by great many people before you at that podium. numbers of many of them, they state that has proved to be false. we're not going to reward north korea for bad behavior. that statement was notably uttered after the 2002

disclosures the administration, the than the bush administration, said they then believe they had the enrichment program. it's perfectly reasonable to look at the 2005 agreement as rewarding the north in various ways, including removing them from the state sponsors of terrorism list. two questions -- why is it not a asonable strategy to offer them incentives that get you some kind of benefits? for example, the destruction of the cooling tower. why is that not a reasonable thing? it may not eliminate their capability of these reports are true, but it at least mitigates it. >> let me talk about this year

and last year. i will call on actions that preceded the obama administration. we have seen significant provocations by north korea from missile tests to the sinking of a ship, and now to this publicity stunts that we're going to evaluate further. our position is clear. north korea has to take affirmative steps to credibly show is prepared to meet its international obligations. you mentioned the 2005 joint statement.

we are going to look for north korea to work constructively with the international community. if this program isn't fact a uranium enrichment program, it's a step in the wrong direction. >> to try to get another country to do something they don't appear to want to do, you have incentives are disincentives. the sanctions you have imposed don't seem to have worked. >> this is a pursuit, and interest north korea has had for many, many years. not in a position to judge what the doctor and others were shown. you don't just produce this kind

of material overnight. we're going to evaluate the implications of this, but this could very well be something that has been evolving over many, many years and may or may not be a reflection of the success we think we have had with 8 resolution and its implementation. if north korea says it wants normalized relations with the united states, if north korea is interested in moving down that path, this is clearly going in the wrong direction. >> i would like to try to ask about where you would like to go from here. you've said north koreans have to do certain things before you resume the six party talks. i was curious how this affects

the list of living should like to do it if you uld be specific because of the to have been reluctant to give us -- >> i can go back over our list which includes more constructive relations with other countries in the region. stopping provocative actions which create greater tension in the region and this is clearly inconsistent with steps we have demanded north korea take in order to demonstrate a credible interest in negotiations for a differ relationship with the united states or the international community. >> what would you like them to do now? >> our policy remains intact. our policy remains what it was

prior to these revelations. north korea has made a commitment under the 2005 joint statement to denuclearize. we need to see credible, verifiable action in that direction. the revelation of a supposedly uranium enrichment capability is certainly inconsistent with the international obligation and its commitment under the 2005 joint statement. we are consulting with others on the path forward. as the proverbial ball remains in north korea's court. >> given that in the past, this provocative actn, the u.s. has pushed for sanctions in the security council. does this rise to that level

that you like to push for more punitive measures? >> we are still assessing the information that has come in comparing it to concerns we have had for some time. we are consulting now with our partners in this process. we will carefully consider how to respond to this latest information, just as we took our time and consulted with countries. >> [inaudible] >> we will take appropriate measure of what has happened here, understand the implications depending on how we assess the revelation by north korea and we will take appropriate action. >> what the mean lycee you're

not going to buy into this? what kind of reaction are you trying to avoid? >> who knows why they did it? no. react had an agenda when it invited these scientists to visit pyongyang. they were very clear in discussing and open to showing these scientists a limited view of a supposed uranium enrichment capability. so they have an agenda which would presume we would be required to react and potentially reward this new development and we're not going to do that. >> any plans to speak directly to the north koreans? >> it is going to take some time

for us to work through this information. it is a medium-term and long- term policy implications. >> [unintelligible] >> not to my knowledge. >> are you responding with urgency? >> is this concerning to us? of course. any potential expansion of north korea's nuclear programs is a major concern. why is that? north korea is a serial proliferators. as it develops potentially new capabilities, their past track record would suggest they make this capability available to other countries. our principal concern about north korea is the proliferation risk it represents.

that is why we developed a number of tools over the years, excluding additional -- including additional sanctions to protect against this potential risk. >> e.c. 80 est not know about this facility before it was shown to the doctor. >> we presented specific concerns to north korea as far back as 2002. about its pursuit of enrichment capability. i never see how you could reach that conclusion. i'm not going to talk about what we do or did not know prior to these scientists. >> i'm not going to talk about intelligence matters at the moment. >> [unintelligible]

has there been any negotiation as far as the deployment of u.s. nukes in -- what effect might that have on the negotiations with iran? >> these are two different countries and to different situations. >> he seemed reasonably confident that they have not got any outside assistance. prior to that, have they gotten outside assistance because some reports suggest this could be up pakistan the origin. >> is very difficult to answer that without the intelligence. >> [unintelligible] >> its very difficult for us to get inside the minds of the north korean leadership.

>> the ambassador said the doors to 6 party talks is still open. >> our policy remains the same as it was last week. we want to see north korea take verifiable, critical steps toward denuclearization. i'm not going to rule out any particular step that might get us down that path, but that's why we are consulting with countries this week, to assess the implications of what we have learned and chart a way forward. it is hard to predict what the next steps will be. we will carefully evaluate what to do next with our partners in the process. >> we obtained some documents from the --

>> hold on -- >> what is the boss worth team doing over there? >> we are breeding these countries about what we have learned. we have had some briefings in washington with representatives from the four countries last week as well. we are going to assess what we know and what the potential implications are. we will work with these countries some appropriate path toward. >> you say this does not come as a surprise to us and it's not a crisis. you knew of their interest in enriching uranium for years. why a did this all come together? why was he hastily dispatched on a saturday morning to go talk to

these people about what you at one point called a publicity stunt? >> first of all, information has come in. it is serious information. it has potential implications on our approach to north korea. in light of the severity of the information, we are still working to ss. we thought it was appropriate to send the ambassador out to talk to other countries about this. >> this information you are referring to a comedy commercial satellite -- [inaudible] can you tell me how this is

sensitive intelligence material? this was gone through what you call a publicity stunt. >> i am not going to speak for the doctor. what he glanced at in a brief show and tell from north korea has potentially serious implications. i am not dismissing the potential significance of this, but based i relatively brief exposure to some technology, by itself, we cannot draw allegations about how mature this capability may be. >> my question is more to the fact that you keep saying you cannot comment because it involves sensitive intelligence. the intelligence here seems to be cleaned and posted on a website by stanford university

professor. i'm not sure how sensitive or classified that might be. the information is publicly to discuss -- it's out there for anyone to see. i keep -- i can understand why you -- you don't seem to have any intelligence here. the information he went out there with is the information the doctor got, correct, from this show and tell publicity stunts. into intelligence -- obviously, we intensively watch north korea all the time. we have information on what is happening in north korea from a

variety of sources. human intelligence is among the most the label means by which we understand what is going on in a particular country, including north korea. we are taking information the doctor provided and we are combining that with other sources of information and we will assess the potential implications of a north korean and richmond capability. we are doing due diligence, but by itself, the fact that's the north korean scientists come to -- or the koreans invited scientists come to pyongyang. we will make a formal assessment as to what we think this

capability represents and what the implications are. >> what is the state department's decision on whether the u.s. should supply tactical weapons to south korea? >> on not going down that road. >> [unintelligible] >> i don't understand the question. >> some say [unintelligible] >> i think those things are closely connected. north korea has eight nuclear capability that is of concern to the united states and the

international community. that is why the united states has worked steadfastly with the international community over the years to try to convince north korea to change course. north korea has in fact made public and events to change course in the 2005 joint statement. it has failed to abide by those commitments and as a result, the international community, including the united states have taken aggressive action over a number of years to try to protect ourselves from the proliferation threat north korea represents. 1874 is the latest of a series of actions to try to guard against this proliferation risk. we will continue to assess and take appropriate action going forward. the first step is the kind of consultation the ambassador is undertaking this week. >> [inaudible]

with state council or any other senior chinese officials about this. >> we have been talking to other countries about our concerns about arms korean activity for some time. i cannot say she has had conversations with her counterparts over the past several days. we did have a direct conversations with representatives from each of the countries and their embassies here in washington over the last few days to fully brief them on what we have learned. the secretary in this time has

been fully engaged. >> does the administration plan to, as it often has in the past, ask the chinese to exert more influence to the extent they have any of north korea following the disclosure -- >> the ambassador will be in beijing tomorrow. >> we rely on china which has a significant relationship with north korea to send direct, clear, stern messages to pyongyang and we expect china to do that in the future as well. >> tomorrow, one of the scientists who recently returned from n