case. let me explain the procedure. when lawmakers file these annual personal financial disclosure reports, they are not giving specific values for the investments that they make. by law, all they have to do is give a range. for example, it could be $1,001- there is a lot of wiggle room. . have an investment that is worth just more than $1 million, but potentially all we can tell that it could be worth anywhere between $1,000,000.5000000 dollars. the bottom line with that -- between $1-$5 million. conversely if you have members with a lot of liability, they also have to record that in these reports. there is a very broad range to how much they may be in debt. as it applies to those people

who are definitely in the red, you can tell from their disclosure reports, even when you calculate the minimum and maximum net worth of a particular member of congress, the ones you have just mentioned, both the minimum and maximum range, they added to be in the negative range. host: among the poorest of the u.s. senate, senator johnson followed by senator chuck schumer. both worth an estimated $700,000. senator lugar worth $670,000 followed by senator wicker and senator kyl. guest: you have said -- a congressman in the house and senate that will fall outside the norm for members of congress. there is an exception to every rule. what may be the case for most members and be the case for, certainly, the wealthiest members coming you have some people who come from more modest

means who have not had the business success that some members of congress have had. host: you can check out his blog @ opensecrets.org. they check money and politics. he also works for "the dallas morning news" and "the eagle tribune." from akron, ohio, good morning. caller: i would like to think c- span for bringing us news. i but to talk about citizens united. these die-hard republicans know nothing about citizens united, and nothing about reconciliation. from i understand it, we had a contract where we had george bush not veto anything for six years. the first thing he vetoed was a health care for children. now we have republican house, a republican senate, republican committees, a republican president and now have a republican supreme court. as they were leaving, they do citizens united which is unlimited campaign contributions

for companies. you, as a citizen, economic and $2,400 but they can give $24 million and not show. i have watched these letters of disclosure on c-span and i can- someone as long as i say not to vote for them. i can hide behind any kind of name i take. something is wrong here. they elected that supreme court for christian ethics and morals and what do they do? they do the citizens united case. people need to look at what is important. the rich protect the rich and are putting in the laws that the american people have no idea what citizens united is. they have no idea what reconciliation is. they are ignorant. i cannot believe it. i have friends that cannot stand obama. they blame everything on obama. the democrats for the richest

nation in two years. i just sit there in awe. thank you for c-span. i will listen to your comments. guest: it is important to note what citizens united actually did. first, what it did not do. corporations, trade unions, trade associations still cannot write a check and simply give it to a politician and say, "here is $1 million and go do what ever you will do." what they can do is take that $1 million, $10 million, and the dollar amount that they want and spend the money to independently advocate for or against a politician. that is a major change from what we had prior to the citizens united supreme court decision earlier this year. this type of activity, prior to that decision, was illegal. if you are exxonmobil, service employees international union, the u.s. chamber of commerce,

you can go ahead on television, the radio, spend as much money as you want and raise this from as many people as you want or as many corporate treasurers, union treasuries, and try to tear down or promote any political candidate who is running in the federal election, state election, or local election. again, you cannot just go ahead and give the money directly to a politician. as we have seen, we saw hundreds of millions of dollars just in this election cycle alone to absent the presidential election, with these outside organizations be it a corporation or, in most cases, organizations never trade unions, trade associations, non- profit organizations, taking in this money. you did not know who the source of the donor was and still do not. if your house you can make the communication, promote this

candid, tear a candid it down, promote or tear down a candidate. host: we showed some of the poorest members of the senate. senator record is it worth about $660,000. one of our twitter followers says, "forced member of the senate with $600,000? where does that put them with respect to the general population"? guest: a good point. even when you look at the "poorest" members of the senate, they are not for with respect to the americans. i do not know the original of americans "-- relative to the senate, but we are looking at five figures relative to the mid to high six figures. host: the leventhal from

opensecrets.org. caller: the biggest cost to the american people are the senators and congressman. we are paying them on god the amounts of money. they get in trouble, then we paid to take care of them. they want to cut my benefits. i do not understand it. our biggest cost is them. if i did my job like they do their job, i would be fired. i do not understand it. every time i expressed my opinion, i am red flag at the va. host: we will not red flag you. thank you for calling in. guest: every american with the ability to vote has the ability to hire and fire any member of congress that they want to. it is more frequent for members of the house than it is in the senate, two years versus six years, four years for the

president. this is why we have the election process that we do. we feel it is critical that people educate themselves to become an informed voter, do their homework, be their own best reporter, and he is websites such as opensecrets or the myriad of other organizations that do a lot of great work and figure out whether they really, really like what they are getting out of their member of congress who they have sent to represent them. if you do not like it, do not like the person, do not like the actions they take, not happy with the personal investments they make, take this information into account when you go into the ballot booth. use that power and knowledge that you had and take action. host: 1% of americans are millionaires and between average 40%-50% of the u.s. house and senate consists of millionaires. a call from the bahamas. caller: for example, i am not a

big fan the congress being multimillionaire's. there have been bought and sold by the lobbyists even before they get there. they have all of these perks, trips. my question is about a representative from san diego, darrell issa. he was a navy officer. he was much more wealthy before he is now. he was close to $1 billion. he went into public service, but he did not get wealthy before going to the congress. you may want to clarify that. host: darrell issa leads the list. his work is over $300 million.

guest: we track this for that very reason. the wealth of the members of congress does fluctuate a good bit. between 2007-2008, it did it. the average net worth for the members of congress to about 5% hit which was right in the middle of the economy going sour and the economics in this country going south. yet, they recovered pretty quickly from members of congress when we saw 2008 to 2009 and the average wealth went up by 15%. and was a very, very different situation just one year to another. while many americans were struggling and it joblessness was hovering between 9%-10%, the average wealth of members of congress was going up. whether it was darrell issa or others, they are still very rich

when it comes to the upper crust, but they do definitely take kids or boosts depending on how their investments do. host: looking at the senate, senator kerry who married into his wealth, senator mark warner who made his money before running for governor of virginia and is now in the senate, senator kohl who is part of the calls department store family, senator rockefeller inherited his wealth. how much of this is before they sought public office and how much is made while in office? guest: many members of congress before elected come in very wealthy. they made their money in business. they made their money in investments. they are coming in as millionaires, multimillionaire's, and in a couple of cases millionaires that had their wealth ranging in nine figures. that does not preclude them from keeping investments in place once they get into congress. while most of them come in

relatively wealthy, congressional salaries, while generous, was not earning millions of dollars in and of themselves. members of congress are definitely keeping the irons in the hot fires that they are in and are generating big, big dollars for them which is why you see the fluctuations, why you see lawmakers who are already very wealthy continuing to get wealthy, getting richer, and richer, and richer. host: from tuscaloosa, alabama, you are next. caller: good morning. i've been like to point out that it is extremely expensive to run for congress. it is no wonder the people who get elected are rich. they could not get elected if they were not. i want to bring out its background question. is not it the dirty little secret of government that most

federal income taxes are paid by the rich? if there is only a small number of rich people, then most of the money coming in through the federal income tax is coming from that small number of rich people. dirty little secret of government that they have to encourage rich people to make more money, they have to support it to make possible for richer people to become richer because it is where their money is coming from taxes? if we discourage people from becoming a rich, there will be less money coming in to the federal government. it seems to me like a basic principle that no one ever points out. host: thank you, nancy. did you have a final point? caller: no. host: thank you for the call. guest: certainly if you are welcome to you will pay more taxes whether you are in

congress for private business. if you make millions of dollars, you will pay more in taxes than a person who has a modest salary. to the caller's first point that she initially made, as a site now, she mentioned that it is very expensive to actually run a campaign. that is very true. the average winner of a u.s. house race in 2008, and we are still calculating the numbers for 2010, was about $1.4 million. it was about 8.5 bunyan dollars on the senate side. absolutely it takes -- it was $8.5 million on the senate side. absolutely it takes a lot of money. one phenomenon we have seen across the years that has played out in grand fashion during this election cycle was when the infinitely wealthy spend millions of dollars on their rahm campaigns, they actually do very poorly. these self funded candidates,

the linda macmahons and other people who spend seven figures on their own congressional races out of their own pocket, only about one in five, at least at the federal level, actually won. yes, money is an essential element to winning a congressional campaign, but you have to consider the source of the money. yet to consider the type of the money. all types of money are certainly not created equal which is particularly the case when you look at self funded candidates who do not generally do very well. host: you can join the conversation on line at twitter. over 40% of congress are millionaires. this is not a representative government. guest: a lot of people have made that point that it is not a representative government. 40%-50% millionaires in congress

year in and year out and only 1% or less of americans are saying the same thing about themselves? there is definitely a gap. there is a disconnected. you can say that is a good thing, a bad thing, we make no judgment on it one way or another, but we think it is important that people do realize that. if you are upset, great. do something about it. host: we are talking about money, politics, and the gulf of members of congress. from harrison, mich., with dave levinthal of opensecrets.org. caller: by may 70-year-old senior citizen that is having problems to survive. the more i watch the news, the more i cried. host: can you turn the television set volume down? caller: turn it off, john.

anyways, i am trying to survive in harrison, michigan. my point is that this country is planting so many trees that no one can see the forest anymore. what is burning me up now on the inside, and i believe i am right, is this trip to afghanistan, again, with the president. he has done this twice and it is no more than a campaign for the 2012 election. is burning me up inside. i believe i am right. i believe is a political ploy that the taxpayers pay for. god bless me if i am wrong. host: you can turn the television back up and dave leventhal will answer your point. guest: with the look of a president's whether it is a barack obama, george w. bush, bill clinton, go back to dwight eisenhower if you want to. presidents have always traveled. they always crisscross the country and in the more recent years have gone on across the

world. george w. bush made a lot of trips to afghanistan, iraq, and the war efforts going on. barack obama has done the same. this is not something that is unique to a republican or a democrat. they have all done it. he is the president of the united states. george w. bush was the president of united states and there are certain travel requirements that are going to happen as a result of being the most powerful leader in the world. i do not know if it is anything that is particularly new or different given that it is barack obama, george w. bush, or any other chief executive. host: another look at the richest members of the senate. from the grove, aloi, an airline for republicans. -- elkgrove, ill. caller: i called on the republican line but i am a liberal conservative. i want to make a comment on the

figures you are putting up there about the network. previous callers had made a good point it is important how they made their money, inherited it, worked for it. even if you inherit it, your family still worked for it. in more poignant figure would be to measure the net worth of of political leaders before they got into political office compared to what they're worth the now because if you look at a lot of poor countries, south america for example, they fear people to get into politics when they are for -- poor because they rate the country for as much as they can. and more poignant figure would be to the difference between -- to note what they are worse before in the congress and after. guest: a very good point, and we have a limited ability to demonstrate that. you can extrapolate with the

more wealthy people who have come to congress. when you do get into congress and are a candidate for congress, you do have to file these mandatory federally mandated reports on an annual basis that require you to list certain aspects of your wealth and a detailed them in these ranges that are provided in these reports. q. do not have an analogy for that when you are just simply a private citizen. the access to that type of information, you would not get the same type from people who have not been elected to congress or are not running for congress. certainly we would love to see and make that comparison because it would be very, very interesting. the caller, in addition to a number people, would definitely like to see it, but it would be difficult to do any practical sense because you do not have the type of reporting for the average american whereas you do for members of congress. host: "i contributed quite a

few small amounts between $5.20 dollars. one wonders if you should bother." guest: if you make a $10 donation, a $50 donation, will that compete with the people making the $1,000, $2,000, matching at $2,400 for a particular candidate for an election cycle? some people say now. on the other hand, you see some candidates he had a great deal of success raising the bulk of their money from people we consider to be smaller downers, making those incremental $10, $15 from $20 contributions. some candidates have had a great amount of success as a result of people making those donations. is $10 at the end of the day really going to make a difference? probably not, but when you couple $10 here and there all across the district or state, or

all across the country, then you do have power. it is just like voting. one vote will not turn a race on its head, but when you get the opportunity toward citizenship. "washington journal," a live on c-span. some thought a.m. eastern.

next, president obama announces a trade agreement to sell correa and comments on the bush era tax cuts. then the debate on the tax-cut amendment. and then democrat and republican -- republican reaction to it. >> if i had to put my money on a likely outcome, it would be peace in iran. it is likely to be [unintelligible] we have to hope that if it does happen, the new dictator or ruler will be a lot more benign than saddam hussein. >> in longtime london correspondent to the new york times, john burns, on the war in iraq. this is on "q&a" on sunday at

8:00 p.m. eastern. >> book tv is available to you on television, on-line, and radio. you can also look get our video library. c-span is on the road with our. the c-span network is available in millions of homes. it is provided as a public service. >> earlier today, president obama spoke about a new free- trade agreement with south korea, which he says will create 7000 american jobs. he also takes questions on the senate blocking two democratic measures to extend the bush era tax cuts. this is about 10 minutes.

>> good afternoon. i want to talk about creating jobs. yesterday's jobs report shows that private sector job growth for the last 11 consecutive months -- it is not enough. we have to do more to accelerate the economic recovery and create jobs for the millions of americans that are still looking for work. he settled to that effort is opening new markets around the world, products that are made in america. we do not want to be an economy that does other countries could. we want to build an export products that keeps america competitive in the 21st century. that is why i am very pleased

area have reached an agreement on a landmark trade deal between our two countries. i enjoyed this morning by my outstanding u.s. trade representative as well as one of our lead negotiators. as you will remember, we did not a fine and not -- finalize this agreement on a recent trip to south korea. i did not agree to it then because the deal was not good enough for the american economy half and for the american workers. i am not interested in signing trade agreements for the sake of signing trade agreement. i want to increase jobs and exports for the american people. i want to help our partners grow their economies. i told them to take the time to get this right. that is what they have done. the agreement we are announcing

today includes several important improvements and achieves a i believe is a win-win for both countries. the deal is for american workers, for farmers, ranchers that will increase exports of american agricultural products. aerospace and electronics, exports to korea which supports 2000 american jobs and many small businesses. manufacturers of american cars and trucks will have much more access in the korean market. we will encourage development of electric cars and new technology in the united states. we will continue to ensure a level playing field for american auto makers here at home. the tariff reductions in this agreement are expected to boost in oil exports of american goods by up to $11 billion.

this agreement, including the open it -- opening of the free and services market will create 70,000 american jobs. it will contribute significantly to double in u.s. exports over the next five years. it is estimated that the deal will increase the economic output by more than our last nine trade agreements combine. this deal is a win for our allies in south korea. they will gain greater access to our markets in the make american products more affordable for career households and businesses, resulting in more choices for consumers and jobs for americans. today is also a win for a strong and allen -- alliance between south korea and the united states, which has ensured

security and maintain stability on the peninsula. we have seen the extraordinary rise from poverty to prosperity in south korea. there are increasing tensions on the peninsula following the north unprovoked attack on the people, today we are showing that the alliance with the united states and south korea is stronger than ever. i am pleased this this -- this agreement has tax cuts for workers' rights and in the environment. this is the example of the kind of fair trade agreement that i will continue to work for as president in asia and around the world. it shows that the united states of america is determined to lead in compete in the global economy. we will stand for american companies and workers. we will compete aggressively for jobs for the 21st century.

reaching this agreement was not easy. i want to give thanks to my partner, the south korean president, for his work to get into a successful agreement. i want to thank my colleagues for their outstanding work in their tireless efforts. they were of late a lot of nights over the last several months. we will continue to work with our korean partners to build on progress in other areas such as full access to the caribbean market. i look forward to working with congress and the leaders in both parties -- to the korean market. i look forward to working with congress and the leaders in both parties on this front. earlier today, the senate voted on to provisions to extend tax cuts to the middle class.

i am disappointed that they did not pass legislation to make middle-class tax cut permanent. those provisions should have passed. it makes no sense to have tax cuts for the middle cats -- middle-class held hostage for permanent ones for the upper class. especially since the latter will cost $700 billion, which we do not have. thetoday's vote cannot be end of the discussion. it is essential for hard-working middle-class families into the economy to make sure their taxes do not go up on january 1. i have spoken with the democratic leadership in congress. a look forward to speaking with the republican leadership as well. we need to redouble our efforts to resolve this impasse in the

next few days and give the american people peace of mind that taxes will not go up on january 1. as we work our way through this issue, we cannot forget that 2 million americans last week saw the unemployment insurance expire in the middle of the holiday season. that is not how we should do business in america. it is wrong to even consider giving permanent tax breaks to the wealthiest americans while denying relief to so many middle-class americans who desperately need it and lost their job of no fault of their own. we will continue to work on this issue through the weekend into early next week. i will be rolling up my sleeves with the leaders of both parties

of congress. we need to get this resolved. thanks. >> would shoot accept a temporary extension of all of the tax cuts? -- would you accept a temporary extension of all of the tax cuts? [unintelligible] >> next a portion of today's debate on the senate tax-cut amendment. democratic and republican reaction to the votes in weekly radio address as with vice- president by then and mark kirk. on newsmakers, president and ceo of the bank of st. louis talks about of the bank's role of shorn of the economy. "newsmakers" sunday at 10:00

a.m. and 6:00 p.m. eastern. >> we do not have a verification method to ensure that we know what the russians are doing. they do not know what we are doing. when you have uncertainty in the area of nuclear weapons, that is much more dangerous in the world that religion. >> find out what the nuclear arms treaty with russia will accomplish. the session today regarding the bush era tax cuts -- one extended tax cuts to those families earning less than $250,000.

neither measure gained enough votes to move on. negotiates continue we begin with senator schumer and warren had. >> this debate is very simple. that is, does everyone here believe in all good faith that we should extend permanent tax breaks to the middle-class? millionaires and billionaires at a time ofuge deficit? mr. schumer: i would argue vociferously, no. i would argue most economists agree that shouldn't happen. i would argue that the american people by 26% to 74% are against giving new tax breaks to millionaires. why? it's very simple. it's not that we are against millionaires. god bless them. most of them made their money the hard way.

they worked hard, they made the american dream. every one of us would like to have done that, or most of us. so this is not aimed at being critical of them. but it, rather, says we have two economic realities. one, we have an economy that, under the bush tax cs right now --y colleague mentioned unemployment went up to 9.8%. that's under these tax cuts. when the rates were a little higher under president clinton, we never had unemployment that high. but we would argue, so the middle class needs to continue that break for two reasons. one, ittimulates the economy. and, number two, middle-class incomes have declined over the last decade. first decade under the bush tax cuts, middle-class incomes declined. first decade since world war ii. under the clinton rates,

middle-class incomes increased rather significantly. and, second, we would say this. but at the same time -- and this is the conundrum we ha economically here -- we have a large deficit. and the question is, how do you reduce the deficit? again, i think both of us agree we should reduce the deficit. it seems to me that about the best way to reduce the deficit is not to give $300 billion of tax breaks to the 315,000 americans whose income is over a million dollars. by the way, i would remind my colleague, there are 160 million people. my colleague from alaska has reminded me. 160 million people file tax returns. only 315,000 -- by quick math, that's about .03% -- have an income over a million dollars.

but over the last decade under the bush tax cuts, those people havearnered all the increase in wealth, all the increase in income, or just about, a huge proportion of it. so if you're looking for deficit reduion, should you hurt the middle class? no. should you stop building roads? in my opinion, no. should you take money out of social security? my opinion, no. where are you going to get it? don't do unemployment benefits? which stimulate the economy and means so much to middle-class people who've been out of work for so long under this regime of bush tax cuts? no. the best place to get that mon money it's not that we want to punish wealthy people. we want to praise them. but they're doing fine and they're not going to spend the

money and stimulate the economy. and for some reason, 42 members of this senate, all on the other side of the aisle, somehow 9 linchpin of their entire -- somehow the linchpin of their entire economic policy is tax breaks and further tax breaks for those who are very, very wealthy. let me remind my colleague, every person whose income is $100 million -- there aren't many of them, but they have a lot of the income -- would get a $3.8 million tax break a year. the average middle-class person under our plan would get about a $2,000 tax break a year. is that equivalent? certainly the person making $3.8 million isn't going to rush to j.c. penney and buy that warm winter coat they've been waiting for? huh-uh. so i say to my colleague, it is a bit conadictory to say pay

for unemployment benefits but don't pay for tax cuts to the rich. it's also a bitontradictory to say you care about deficit reduction but not when it comes to tax breaks for the wealthiest people. and i'm going to be here for the next year, next two years to remind my colleagues every time they talk about deficit reduction and don't spend money on this and don't spend money on that, that they were willing to increase the deficit $300 billion to give tax breaks to people who have over a million dollars. with that, i'd yield the floor and turn it over. i see my colleague from utah's here and i kept him waiting yesterday. i'm not going to do that today. so i yield the floor. mr. hatch: i appreciate my colleague. mr. president? the presiding officer: the senator from utah. mr. hatch: this is a first for

him toield to me and appreciate me. that's not quite accurate because we're good friends. my friend, the senior senator from new york, has come forward with an amendment. now, the essence of the amendment is a marginal tax rate hike on taxpayers earning more than $1 million. it's been dubbed the -- quote -- "millionaire's tax." folks on the other side must know two things. one, this may be well-designed from the other side's political viewpoint. supporting the tax registers well with some of the democratic polling ma mavens. by the same token, those polling mavens might be indicating to their patron patrons that this lame-duck session vote might supply some good campaign material. as the debate ensued this past week, you could almost see my friends on the other side giddily rubbing their hands today. maybe they view this vote as the

eqvalent of a hanukkah gift or a christmas present. but their holiday political joy stands in sharp contrast to the dreary situation facing america's unemployed. two yea of wall-to-wall democraticule has only made the situation worse. there is a second thing our friends on the other side must know. they know that senator schumer's amendment will surely fail. does anybody doubt that? 33 days ago, the american people sent a message -- work together, take care of the people's business. nothing is more fundamental to the people's business than how much they are taxed. and in this weak economythey id keep taxes low. keep taxes low. we should not meddle wit the great sovereign power of taxation. it is especially true in this harsh economic debate. on april 19, 1774, sir edmund burke tried to persuade the british parliament to repeal the last of several controversial

colonial taxes. his wisdom was instructive for today's vote. i quote -- -- and remember, ths sir edmund burke arguing for the colonists in america. quote -- "could anything be a subject to more just alarm of america than to see you go out of the plain highroad of finance and give up your most certain revenues and your clearest interests merely for the sake of insulting your colonies." burke's point was the parliament was acting unwising by maintaining a tea tax primarily despitprimarilyto spite the col. four years from day, we will support tax day 2011. it will impose a punitive tax hike on virtually every american taxpayer. that day of reckoning has been clear since my friends took power almost four years ago in both houses of congress. my friends on the other side, with all due respect, your actions this morning amount to meddling. you possess part of the sovereign power to change the

tax law to prevent this tax increase. instead you have forced this body into a political showdown. the proponents of the so-lled millionaires tax say the reason to do is -- quote -- "fiscal discipline." this proposal preserves less than half of the revenue of the related provisions in the reid-baucus substitute. if that's the case and revenue is the goal of the proponents of the millionaires tax, they ought to stick with the reid-baucus substitute. but let's set aside the moment the fact that the revenue raised is a fraction that the broader tax hike on the reid-baucus substitute. does anyone take seriously the -- that the revenue raised will go to deficit reduction? does anybody really believe that? you know they're going to spend every dime of it if there were any revenues. where is the mechanism in the endment to assure taxpayers of that? more importantly what is the record of my friends on the other side on this poi?

you need to only look at the fine print. in the revenue and spending of the president's budget. as an aside the president's budget is the most transparent presentation of the fiscal features of the agenda of my friend on the other side. hiking marginal tax rates on singles making more than $200,000 and on families making over $250,000 translate to about .6% of 1% of gross domestic product, g.d.p., per year over 10 years. the new above baseline spending initiatives inhe president's dget translate to .7500 of 1% of g.d.p. per year over 10 years. what does that mean? the revenue raised by the tax hike in the reid-baucus substitute is less than the new spending in the president's budget. it doesn't take a rocket scientist to figure this out. and as i've stated earlier the

revenue raised from my friend from new york he's amendment is less than half of the reid-baucus substitute. does anybody really believe that lesser amount of revenue is less likely to be spent? so much for the fiscal discipline argument. there's some very disturbing points to ponder in this so-called millionaires tax. i'm going to alert my friends on the other side to them. the first point is that capital is the lifeblood of business. put more capital into business and it will respond. the business will gain economic energy. curtail the flow of capital to a business and it will -- and it will respond. the business will lose economic energy. an that's what's happening in america. according to the latest internal revenue service statistics of inkol data a lot of capital gain income is earned by the taxpayers targeted by senator schumer's amendment. s.o.i., in other words,

statistics of income data, states that 56.6% of the net long-term capital gn from traditional capital assetss reported by taxpayers with $1 million or more dollars in income. more importantly if capital gains from transactions involving partnerships and other flow-through entities are a concern, that percentage rises to 64.7%. there can be little doubt that we are talking about a large pool of capital. if my friends on the other side were to prevail it would a game changer for the tax treatment of a large pool of capital of in -- of income from capital. the change in the capital gain would surely be a negative one. i have chart that illustrates the change in the playing field for capital transactions. it shows where we are today. that's 15% capital gains rate. if my friends on the other side are successful in a little over

27 days from now the marginal rate will rise to 20%. the health care reform bill has banked in another 3.9% rateike and that kicks in a little over two years from now and that's this one right here,3.9%. what does this chart show? it shows that the marginal rate on nearly two-thirds of taxable long-term capital gains transactions could be affected. it means investors who supply that capital, leblood of business, will see the marginal tax rate on capital gains rise by nearly 60% in a little over two years. everything else being equal, a rise in the marginal tax rate means a decline in the after-tax rate of return. the nonpartisan joint committee on taxation always cautions us about this effect in their revenue estimates. here's what joint tax says and i quote -- "we anticipate that

taxpayers would respond to the increased marginal rate by utilizing tax planning and tax avoid ant strategies that will decrease the amount of income subject to taxation." unquote. my gosh, what more do you need to understand economics? capital is the lifeblood of business. raise the marginal rate on capital gains transactions, the result will be a decrease in the after-tax rate of return on capital investments. what will happen? capital will go out of taxable activities in many cases. capital, the lifeblood of business, will be constricted. with capital constricted, does anody see business activity affected in any way that is positive? it would be hard to imagine that outcome. when most folks hear about a so-called millionaires tax, they probably think it would have minimal impact on the business environment. that they -- the data i discussed shows the op sivment

it also shows that any revenue raised will likely be spent. anybody who believes that by raising revenues, that we're going to pay off the national debt hasn't live in this country for the last 34 years that i've been in the senate. our friends on the other side will always spend that money. that's how they keep themselves in power. does it ke sense to send a tax policy signal to investors to move their capital out of taxable business activity? in the worstconomic environment in many years, now 9.8% unemployment, shouldn't we be going in the opposite direction? instead ofinding way to kill jobs when our unemployment rate continues to stagnate at 10%, let's find a bipartisan solution protect all americans, especially our job creators, from crushing tax hikes. it's time to put a stop to this nonsensical political theater and get down to the people's

business just one last thought. over the last summer president obama said, and i would -- quote -- "the last -- this is president obama now, and he said it just over the last summer -- quote -- "the last thing you want to do is to raise taxes in the middle of a recession because that would just suck up, take more demand out of the economy and put businesses in a further hole." unquote. i think the president was right. and i think the economists think it was right in making that statement. and it should be the last thing we do is raising taxes in the middle of this downturn that now is even more down because the 9.8% unemployment rate. and, really, that only tells part of the story. if you really talk about the underemployment rate, those who don't have jobs, can't find jobs, et cetera, are dependent on the federal government and those who have stopped looking for jobs, and there are a lot of

pele like that,ou're talking 18% or better. we've got to wise up here. what -- the last thing on earth we need to do is increase taxes at this late date. mr. president, this is an important debate,ut the democrats have had four years to change this where they controlled the houses of ngress and in the last two years not only controlled both houses and the presidency, and now at this last minute to come in and say we've got to do something, it jt shows a lack of -- well, you name it.e to speak. senator grassley, senator baucus, i appreciate this. i guess the first observation i would make is that we're here on a saturday morning and this is democracy in many ways i think at its best. people understand the two votes are going to fail but it's good for americans to have genuine differences to be able to discuss what makes us tick, why we want to go one way versus the other. so the fact that america is

divided on a lot of big issues is -- is just the result of living in a free country. now, what was the lessons of the last election? they are what you would like them to be but here's my observation, for what it's worth. our democratic friends really took a beating. as republicans, we have been there. in 2006 and 2008, we took a beating. 2006, the iraq war was going very badly and americans were very frustrated. president bush's popularity plummeted. in 2008, we had an economic meltdown that i thought was related to housing, that we lent money to people who couldn't afford to pay their mortgages, the mortgages were repackaged and sold as all kind of exotic instruments throughout the world and it brought the whole world economy down. and we've been trying to struggle ever since. we can talk about how much fannie mae and freddie mac were the cause of this problem, how much loose practices when it came to lending, but i think most people understand that our

economic crisis was created by the -- the mortgage -- the housing market being overextended and people getting into that market in exotic ways without a whole lot of regulation. now, here we are a couple years later. i think the last election was a message to our democratic friends, for the last two years, you've been going down the wrong road. the health care bill, which about 80% of americans, if it ever becomes law, will become -- will be under government-controlled health care, was an overreach. the stimulus package was $780 billion-something that wass never done what it was billed to do. the democratic party has been engaged in what is way above what every american charged them to do. this election was not pro-republicans but to our democratic colleagues, stop. and the way you get stopped around here is you get replaced. so the house had a dramatic election. we picked up seats in the senate

and some of us thought maybe we could have picked up two or three more and made some pretty poor choices when it came to the candidates. but that's now behind us. and what i would like to tell my colleagues, that when i look at america, i don't see an undertaxed nation. i think our tax code is far too complicated. 35% is the rate now. how much is enough? is it 39.6%? is that the difference between, you know, a -- a social justice country and -- and a land of the rich? i mean, if -- are we going to increase taxes for the upper incomes by 10% when we can't create enough jobs for americans who are unemployed? i do believe this idea that upper-income americans are the ones who create most jobs for the middle class and people looking for work. that's just a fact. here's how our tax code works today. 40% of americans pay no federal income tax. so 40% of us really don't pay any income tax at all. of those who do, 50% of those

who pay federal income tax pay 3%. the other 50% pays 97%. the top 10% of wage earners in this country pays 70% of the taxes. now, i'm for a progressive tax system but that's just not right. that seems to me to be taking the country in the wrong direction. there's 750,000 small businesses will get a tax increase if we do not extend the bush tax cuts for everybody. i'll make a prediction. there's a lot of unsolved mysteries in this world, a lot of things that we'd like to know, we don't know the answer to. this is not one of them. what will happen, hopefully next week, is that all bush-era tax cuts will be extended because we have high unemployment and now is not the time to pass on to business or upper-income americans more taxes. and i hope we can extend some of the obama tax cuts. i don't want to raise taxes on anyone. if you don't pay taxes, then you

shouldn't be getting a tax cut because you have no tax liability. but if you're in the eitc range where you have some tax liability, the obama tax cuts in the stimulus helped you, i'm one who considers that to be something we should be looking at, that no one's taxes should go up. bush-era tax cuts or obama tax cuts. when it comes to the unemployed and unemployment insurance, we're going to extend that but we have to have a package that makes sense. so once we get this vote hyped us and democrats on the other side will join with republicans on this side to say no to the class warfare approach here. now, one of my good friends from new jersey said something that got everybody stirred up, that negotiating with republicans is like negotiating with terrorists. well, i know bob menendez, he's a fine man, but these are heated times and we say things that sometimes maybe sound good to our base but upon reflection we shouldn't say. and i would argue that nobody over here should be considered in that light.

to our democratic friends, we have a genuine disagreement. that's all it is, a genuine disagreement. the one thing we have in common, when the terrorists, the real terrorists do come to visit america, they could care less how much money you make. they will kill the janitor and the business owner just as quick because they don't see any difference based on income. the one thing that america has in common is that we do believe in free speech, open debate, religious diversity, and that's not something that you believe in based on your income. that's something you believe in based on just being an american. so i would ask my colleagues on both sides to understand that not only are we in this war on terror together, we're in this economy together, and a lot of americans are suffering, some more than others. and the ones that are struggling in the middle class and lower incomes are trying to do one thing that everybody agrees on:

get a job. and ladies and gentlemen, i believe the best way for struggling americans to get a job is not to raise taxes but keep them low in a weak economy, and that's what i genuinely believe. i have not come from a rich family. i'm the first person in my family to ever go to college. my mom and dad owned a liquor store and a restaurant. they worked long and hard to make sure that my sister and myself could go to college. when my parents died, i was 22, and my sister was 13. if it were not for social security survivor benefits, we would not have made it. she received pell grants to go to school when her college days were there and i was in the air force and helped where i could. so i get it. people are struggling. there is a role for the government, but this is not the time for our government to raise taxes on anybody because all of us are struggling to try to find

a way out of this economic mess. and there are some stuff days ahead economically. there are some tough days ahead in the war on terror. let's have these votes, come back next week and see if we can solve some problems that all americans are dying for their congress to solve. get us back on sound economic footing, deal with debt, and to senator durbin, senator crapo, to senator coburn, hats off to your vote on the debt commission. you did some very hard thing, and that product is going to serve the country well. we're all in this together, and i wish everyone good holidays and maybe a time to reflect, that we do have more in comomomm the presidingfficer: the senator from montana. mr. baucus: madam president, i think it's important just to lay a few facts on the table. the senator from oregon did a good job of making this point clear, but i think, frankly,

very few people in the country understand ts point, this debate. to be honest, i think there are a gd number of members of the senate who do not understand this point. the point being that under my amendment, which makes the -- those who receive $200,000 and less in income, their tax is permanent. under that amendment, it's important to remind all of us that every individual will get a tax break. every, regardless of his incom that is every individual who has more than $200,000 of taxable income would receive a cut of at least $5,400. if you're ave $200,000, you still get a tax cut. you get a tax cut a an individual about $5,400. if you're a couple, it's probably close to double that. the same is probably true under the schumer amendment. under the schumer amendment, for those who make $1 million, their tax cut's going to be about

$40,000. even though the cutoff is $1 million, those who earn more than $1 million will get a tax cut -- under our amendment. they'll get a tax cut under my amendment, a tax cut under the schumer amendment. under mine, about $5,400. under the schumer amendment, if you earn more than $1 million, you're going to get a tax cut of about $40,000. if you're a couple, it's almost close to double that, most likely. after that, in my amendment, and continuing's also in the schumer -- and i think it's also in the schumer amendment, dividend rates are lower. those fos who rely on dividends are going to get an additional tax break. the point i'm making very clearly is that everybody gets a tax c under our amendments. it's not fair fo the other side to characterize only some people get a tax cut. it is true those under 200 will get a bigger break on a

percentage basis, but dollar terms they're going to get less of a break than those who earn $200,000 and above or under the schumer amendment, $1 million or above. the second point i want to make is we have to make choices, madam president. we often hear the expression, there's no free lunch, nothing is free. life is choices. we make choices here in the senate. sometimes the choices we made are quite difficult, but ty're also significant. i'm a little bit bemused -- i was bemused and still am bemused when i heard the senator from south carolina praise the president's deficit commission report which recommended cutting the national deficit through various mechanisms, revenue increases and spending cuts. the senator was praising that.

and i say bemused because the basic view of the senators on the other side is to increase the national debt by about $4 trillion. that is the amendment offered by the senator from kentucky will raise revenue in the next ten years by $4 trillion. that's adding $4 trillion to the deficit. not subtracting $4 trillion from the deficit, but adding $4 trillion to the deficit for a swing of about $8 trillion over eight, nine, ten years. that i think is fairly important. it's important because many commentators are concerned about the debt that we have as a country. they point out the problem that greece has, ireland, portugal and spain, and even articles that maybe countries should break in europe away from the euro and have a separate currency. the main dispoint we live in

somewhat precarious times and we have to not add to the deficit. the amendment i offered does add to the deficit, i might say, in all candor. it adds about $2 trillion over ten years, because we cut taxes in a manner which i explained. the schumer amendment cuts a little more -- that is adds a little bit more to the deficit. that's only about $2 trillion, $2.3 trillion, $2.4 trillion, whereas the other side would like to add $4 trillion. i'm just saying everybody gets a tax cut under the amendment that i'm offering. and those who make more than $200,000 get more in dollar terms than do people at $200,000 or bel. that's just a statistical fact, a mathematical fact. it's about $5,400 for those who receive $200,000 and above. under schumer it' about $40,000 for those who receive $1 million

and above. whereas those below will also get a tax cut as well. just to remind everybody that we do have to make choices. we have to keep an eye on the debt. we should not increase the debt more. these various provisions do a bit to not increase the debt more than we have to. i might add to that too, it's something i think we should be concerned with. in the last quarter-century, the top 5% of wealthy americans received an after-tax break of about 150%. that is, their after-tax income of the top 5% american people the last quarter century fell by 150%. compare that with middle-income is americans. the last quarter century the

after-tax break changed 20%. a huge difference. our policy caused the most wealthy to have much greater after-tax benefits than do -- than is in effect for middle-income americans. all together i think it makes sense. we balance, have to make choices. everybody gets a tax cut under our two amendments. and i strongly urge my colleagues to support the two amendments. i think it's not perfectut it's good, >> the amendments needed 60 votes to move on. after that vote, mitch mcconnell of kentucky took the floor. with unemployment over 9% for more than -- more scekive months than at any time since world war

2, the voters are looking for a different approach here in washington. two years of out-of-control spending and big-government policies have led to record deficits and debt, chronic unemployment and deep your honor certainty about our nation's fiscal future, meaningful show votes and antibusiness rhetoric won't do anything to make the situation better. this saturday's session is a total waste of the american people's time. one of the votes wheeled today was opposed by every single republican and many democrats. and the other vote we held was a poll-tested plan opposed by every single republican and the president of the united states. and as you can see, nothing wees did today stopped the tax hikes that are now less than a month away. as the majority leader said this morning, these thee attribution need to end. this is a strong, bipartisan -- there is strong bipartisan opposition to these attempts to raise taxes on small business across the country. americans don't want political posturing. they want jobs.

today's votes were the clearest signal yet that the democrats in congress do not take our nation's job crisis seriously. mr. president, i yield the floor. a senator: will the majority leader yield for a a question? the presiding officer: will the majority leader yield? mr. baucus: he is not the majority leader, i might add. ms. landrieu: i'm sorry. would the minority leader yield for a question? the presiding officer: the republican leader? ms. landrieu: i guess that's a "no." mr. baucus: mr. president? mr. president? the presiding officer: the senator from montana. mr. baucus: mr. president, i ask unanimous consent that the senate proceed to a period of morning business with senators permitted to speak for up to ten minutes each. the presiding officer: without objection. mr. baucus: mr. president? ms. landrieu:? butmr. baucus: mr. president? the presiding officer: the senator from montana. mr. baucus: there are several senators prepared to speak this morning, who were unable to because of limited time. in order to accommodate them, i ask consent that the order of

speakers on the democratic side be the following: senator dorgan, 20 minutes; senator boxer, 10 minutes; senator mccaskill, 10 minutes; and senator casey, 10 minutes. further, if there are republicans seeking recognition on the floor, they would alternate back and forth between the two sides. the presiding officer: is there objection? ms. landrieu: mr. president, may i ask consent of the first member on that list to speak for 30 seconds? thank you. the presiding officer: is there objection? without objection, so ordered. ms. landrieu: thank you. mr. president, i was going to ask the minority leader, mitch mcconnell, who just insulted many of us by saying that we don't care about small business or the economy and as the chair of the small business committee, i was going to ask him this: since president obama has been in such good faith in the last couple of days negotiating with him this package, my question was, does he regret saying on

national television that his number-one primary goal is to unseat the president? i was going to ask him how he felt about that. that's a tough place to start a negotiation, which is why some of us are interested in how these negotiations might be going with that as a startingpoint. but he ran off the floor and didn't answer that question. i will going to i am going to continue to ask it. thank you. let me just add, i don't agree with every policy with the president. anymore a major fight over offshore oil and gas. but it is very interesting to some of us who have been in negotiations, how you start by saying my goal is to defeat you but here is the packages we want you to accept. some of us are >>

now, democratic and republican reaction to the senate votes. both news conferences are about 40 minutes. news conferences are about 40 minutes. >> is everyone here? ok. i think the vote today showed the american people where both sides of the aisle are. democrats are for a middle-class tax cut. republicans are willing to hold hostage the middle class tax cuts to get tax cuts for the wealthy. the middle class needs the tax cuts. their incomes have declined. the highest income bracket have done very well and there dollars have shown a deficit reduction. that is how we feel. the other party seems to feel that tax cuts for millionaires and billionaires is the most

important thing this nation can do. we're going to continue this fight until we achieve our goal. permanent tax cut for the middle class but no tax cuts for the millionaires and billionaires. we did not have anything against them. god bless them. they have made a lot of money, and that is great, but they do not stimulate the economy. only 30 cents of every $1 to the highest income people is spent. $1.52 is spent on unemployment benefits. we find it impossible to understand how our colleagues on the other side of the aisle say that if we can give tax cuts to the highest income people and not pay for it but we cannot do that for those who are unemployed. we have an order here depending on who has to leave so we will go to senator lautenberg first. >> thank you, chuck. >> in order of the best orator. >> we will get down to serious business. i look at what is going on

here, this tax relief for people who are fundamentally rich. i had a good business career. i would be entitled to a tax cut for those over the $1 million mark. i do not want it. i do not need it. but this is is a great american travesty. think about it. while america is fighting wars and over 150,000 of our people are off in afghanistan, brothers, sisters, fathers, mothers, face life and limb in the process. our country is facing a fiscal

crisis. republicans are fighting to make sure we provide tax relief to the richest among cost. in a recent "the new york times" article, it showed eight faces of people made $1 billion per year, the richest among them $3.4 billion. they want to get more tax relief to those people. it is an outrage. this is a per-capita income in our country of about $60,000. we have over 15 million people without jobs and now we hear from the republicans "too bad." but the richest, and thus need tax relief. when does conscious enter into the equation? when you say the extra money i get will not make a difference, but whether or not our country is stronger to provide a brighter future for those who

need an education, for those who need jobs, for those in need some security? when will they say to hell with extra dollars on our tax report? when do we stand up for our country? they say stand down and it is just too bad. >> i think today's vote points of a clear difference between the democrats and republicans on the tax issues. by 53 votes democrats have shown that not only the overwhelming majority of our

caucus and the members of the united states senate, the majority of the members of the senate say that in these tough economic times we need to make sure that the tax relief is continued for middle-income families. republicans in a unified voice said, "we are prepared to filibuster that. we are prepared to filibuster the tax breaks remaining the same for middle-income families in order to protect the very wealthiest in america." it is a sad day for the republican party. it is critically important that we make sure the tax relief is given to middle-income families. >> a colleague of mine on monday when i was presiding said we had to do everything possible that we can to prevent the deficit from increasing. today he voted to increase the deficit by $700 billion. that is a very impressive reversal in one week. i just heard the republican leaders say that we had not learned the lesson from the election. nowhere on the ballot, or on any ballot that i saw, was, "do

you want to extend the tax cuts on incomes above $250,000"? exit polling from the organization edison research that would do this for all of the networks and for ap said 60% of the american people leaving the polling places did not want to extend these bush era tax cuts for people making over $250,000. we campaigned on that. we took the first vote and we

lost. $250,000 is where i would draw the line, but we could compromise. $1 million. they are saying that if you make $1 million, i do not know how you define "millionaire." i know farmers in minnesota who own farms that are worth $3 million or $4 million and they are barely scraping by. i do not know how to measure it, but they sure do not make $1 million in a year. $1 million. i have heard colleagues over and over again saying we need

to make hard choices. this is not really a hard choice. we had two wars. we are headed for a real, real, real crisis in terms of our long-term investment. this is a chance to address it. i want to return to what chuck was saying about unemployment insurance benefits. in minnesota, i met a guy at a building trade union hall. these are guys that work of their lives, and now this is essentially a depression in that industry. i met a carpenter there, on a big guy, calloused hands, he had tears in his eyes and he had barely worked in the last 18 months just getting an odd job here and there. he told me that if it were not for his unemployment insurance, "i do not like taking it, but if it were not for it i would not be in my house."

what are we doing here? they are saying that we have to pay for the unemployment insurance benefits, but we do not have to pay for tax cuts for people who make over $1 million per year? what are we doing? where are our values? we are all going to go back some point soon to have christmas holidays with our families. we have jobs. we have jobs. and it is a great job. our job, as i see it, is it to improve the life of americans. we know it has created jobs. what we see today is an economic philosophy that was a

procter it during the bush administration that created 1 million jobs as opposed to an economic philosophy decorated 22 million jobs during the clinton administration. we want people working. i do not know when we are doing here. thank you. >> we have had 10 years of experience with the bush tax cuts. today, we have had the scene -- have seen the worst job

performance in the poster-war era. we have seen the middle class incomes stagnate, barely grow, and in some places decline. as a matter of policy, as a matter of doing what the american people want to do, to create a growing economy that produces jobs for all citizens, these tax policies have not worked. we have that evidence. it is all around us unfortunately. there is a need at this point to continue to give relief to

middle-income families, to give them some relief as they struggle through this very difficult market. extending the middle-income tax cuts make sense economically and the governmentally. it makes no sense to extend the tax cuts for the very wealthiest americans. in the terms of growing jobs, the economy, the middle-class. then you turn around to the unemployment compensation issue, that, too, is a necessity because of the policies of the bush should ministration, two unfunded wars, the tax cuts for the wealthy, and we see people desperately looking for work. al franken's story can be replicated in every city of this nation. people have worked their whole lives, reached middle-age, not only do they not have a job but they're coming to the terrible realization that they may never get back to where they were. that is not a financial blow, but it is a huge blow to a sense of self, a sense of family, a sense of what your family is about. here the republicans say not only will we not approve a middle-income tax cut unless you tax cuts for the very wealthy, but we will force you to pay for unemployment compensation benefits. we have never done that before under republican and ministrations, a democratic administrations. today the unemployment rate is close to 10%. how they want pay for it? again, this goes back to the hard choices we have to make. and obligated funds, is that

the border fence between texas and mexico? is that the border patrol station? i'm sure they would be the first to say it is not that. we need to make difficult choices. the obvious tourist today was to extend benefits to the middle class and come americans can help them to other provisions, and that was clearly rejected by the republicans. that is unfortunate. >> tuesday night at midnight, 85,000 people from ohio, 2 million americans saw their unemployment benefits end. think that means to a mother who says to their teenage daughter that we will lose our home and we do not know what school district will have to move into. going to food pantries in columbus and akron. every food pantry i have visited, virtually everyone tells me that people who used to give food to the pantry are

now coming in to receive food. yet because of republican opposition, 85,000 ohioans and 2 million americans saw their unemployment benefits and is. we tried to do something about that. i stood on the floor, my colleagues have gone to the floor, jack reed has led the effort on this time and time again just to maintain these unemployment insurance benefits. this is not a welfare program. is an insurance plan. people pay in the. if they lose their jobs, they collect. it is like fire insurance. you want to have a few needed, but you do not ever want to use it. is there if you need it. when people criticize congress, it is often that we do not listen enough. this is an example today that we've tried to do with the american people want.

they think we should extend tax cuts for the broader middle- class and let them expire in four millionaires and billionaires, yet republicans, again, chose to side with the millionaires and billionaires against unemployed workers, low- income workers, the earned income tax credit, and every kind of benefit we wanted to give here. 10 years ago, in 2001-2003 it was the hallmark of the bush economic plan which was to give major tax cuts for the wealthiest people in 2001 and 2003. this is a 10 year experiment that ends on december 31st. that experiment clearly has not worked. during the eight years of george bush, there is a net increase of 1 million private sector jobs contrast it with during the eight years of bill clinton we have 22 million of job increases.

the whole idea of trickle-down economics the whole theory does not work. the whole tax cuts hostage. in essence, what the republicans want to do is bar $700 billion -- barrault's $700 billion -- borrow $700 billion from china, put thisn our children and grandchildren credit-card, and then hand that to millionaires and billionaires. it is bad for our country, it is bad economic policy, it is bad for our future. >> yesterday, i was home in rhode island and i went to the cranstons senior center annual christmas party. it was at the west valley inn, which is a nice dinner hall. there were a couple of peoe there, one nice elderly lady, she signaled me aside to speak to me privately.

she said her son has worked for 28 years. i raised seven children, i am proud of the mall, they are all working. the sun was not out of wk who -- the son was now out of w ork, who had worked for 20 years. for the first time he had taken a minimum wage job and was stocking shelves. people in rhode island and people across the country want to wk. they will work. she said, "my son feels about this big, but he will take the job because people want to work." the theory that we have heard that youannot extend unemployment insurance benefits because it contributes to lazy people who do not want to pick up the jobs is just plain wrong. we of 65,000 people in rhode island without work. there are not 65,000 js, no matt how you divide them up.

unemployment insurance is really an fortin to continue. -- important to continue. as a senator reed said we have never ne this before to cut off unemployment insurance benefits yet that is what they have done. if the but these two things -- if you put these two things side-by-side, what if a family through no fault of their own has lost their income and is now down to their last fumes which is about to be cut off and they go down to zero? that is ok with the republicans. what is not ok is that someone who is making well over $1 million not get $100,000 or so in additional tax relief. it is economically wrong. it is nonsense. from a human perspective, it is an unbelievably brutal theory.

it is bad for america in two significant respects. one, it will cost $700 billion extra on to our debt and deficit, which they claim to be concerned about. two, it drives even further the divide that we have between regular, working americans and the super-wealthy. we are now at a discrepancy between regular people and the super-wealthy that has not been matched in income disparity since the 1920's. we are heading in the wrong direction. their protection of these additional tax benefits for our wealthiest people even at the expense of the deficit drives us even further in that direction. it is simply bad for america to have that continue.

>> my two years have been very interesting. i did not come from the house, the vernor's office, or state legislator. i came in as a mayor. more importantly,i came as a small business person. i find it interesting and ironic when i hear the debate on the effective a have on small -- the effect it will have on small business from the other side, many of them who have never run a business, no experience struggling tmake it through in the economy, gone to a bank and asked for loan to expand your business. we have done it. my wife runs four small retail stores. we see it in real life. i want to tell you this because sometimes when the press looks at us they see us as senators in our political lives, but there are many places we come from. we still do in the sense of our work. i talked to my wife every day, as you can imagine. she owns four small businesses and here is what this debate is about.

we started at $250,000 and we wanted to make sure that group of people enjoy continued tax relief but no, we could not get agreement. no, we want everybody. senator schirmer voted up to $1 -- senator schumer voted it up to $1 million. everyone under $1 million will continue to have tax relief. let me put this in perspective. and is not about how long the extensionsre. there are 160 million tax filers in this country. 315,000 or above $1 million. that is what the debate is about. 315,000 people over here. it could be one year, two years, but the debate is who benefits from the policies that we set? that is what it is about. then they talk about small

business this and that, well, let me tell you. i'm not sure they understand these phrases, but the use the phrases, "llc, partnerships." i have done those. here is how it works. the many files down and your -- the money flows back down into your return. 96% of businesses in this country gross, and that means non-taxable, $1 million or less. we think of taxable income is less than $250,000. in fact, the compromise that we brought forward touched not only every american but almost every small business in this country. eir arguments are false. that boils down to fiscal responsibility. if there is one thing we heard in the election is to create better fiscal responsibility in the senate, take care of the middle class, and small- businessmen. we are doing all three.

small business people are taking care of th the compromise. the community at large is taken care of. and we will not give millionaires and billionaires another $700 billion in a bonus check for them to stuff into the $2 trillion they have in the banks. we are right but that to the -- we will put that to the deficit. the american people said to do something about the deficit, so we are doing three things at once. it is a wide approach. on the other side, it is business as usual. as you heard from my colleagues before, the economy crashed. we think it is the right approach to help small businesses. 96% of small businesses will benefit from the plan we have put forward. 159.6 million taxpayers will benefit. that is the interesting part here. all the man said, when it is all done and said, 315,000

people is what it is about. they all still get some of the benefit. they'll get that level. $700 billion to make sure it goes toward the deficit. again, i find it ironic as a small-business person who lived and breathed that live who has been doing it since the age of 14, this is the reality. i have lived it, i have seen it. the policies we put forward are the right approach to deal with the deficit, the small business community, and all of the taxpayers in this country. questions? >> senator schumer, you said you guys will continue to fight for tax breaks for the mile- class but notax breaks for the wealthy. does that mean that as far as you are concerned a deal that would include a short-term exteion for everyone is off of the table? >> the bottom line is our position has been enunciated

clearly. the majority of democrats voted for both amendments. 53 votes on each. we will keep fighting for that. i cannot tell you what will happen in the next two or three weeks, but i can tell you this. we think this is right substantially, politically, and this will be one of the bigger issues going forward. we are not giving out. -- giving up in three days, one way, two months, six months, this will be a major issue for the next two years in this congress. i'm not going to get into what will happen next. i did not know. -- i don't know what will happen next. we have a very strong vote, a very united vote and both wings of our party for tax cuts for the middle-class but not for millionaires. >> we think pressure will continue to build on the republican senators who voted no on extending unemployment benefits, voted twice no on a

whole host of very popular tax cuts for working families. when 42 republicans signed a tter saying, "we will not do start or any other issues until we can get tax cuts for the wealthy," the public recognizes that more and more as people hear it and understand more and more how we expect two, three, four, five, 10 republicans to peel off because they do not want to be on the wrong side of history. >> the president was going to announce a caribbean trade deal today. -- a career in the trade deal today. >> i spoke with ron kirk yesterday. it is major progress on automobiles. it is not strong enough in terms of non-terrace verio if -- non-tarriff bariers.

i'm still concerned out cars coming from china into korea that will take the back door into the u.s. market. i am also concerned that the model of the tradegreement is not too different from the trilateral nafta on model. this is the largest trilateral -- bilateral trade agreement since the nafta deal. it does not work for america or middle-class policies. while our trade policy is significantly better under president obama, this does not move it forward for me. >> the president has made clear that he does not what the tax -- does not want the tax cuts to expire in a few weeks. are you saying today that democrats are willing to tell thwhite house that we are not going to do any kind of

extension for the wealthiest? >> i will not get into what is going to happen over the next several days. we believe this is a fight worth making for a very long period of time. speaking for myself, i will keep that this. -- keep that this. -- keep at this. i believe this is correct substantially. it is the high ground politically. in the past, when we have had these types of cases, we have drawup our hands. -- we have thrown up our hands. i cannot speak for every one of my colleagues. we did not know what kind of agreement the president will reach, if he reaches one at all. i will not speculate on that. the point we are making here today is that we think it is wrong for tax breaks to go to millionaires. we think it is correct that goes to the middle class. that will be one of our watchwords and you'll see us continuing to work on this next year. >> do you or any of the other senators he the appetite to extend this into january? >> there are lots of people in our caucus who do have that appetite, some who did not.

we will have to see what happens. thank you, everybody. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] >> really excited to be here on saturday, right? >> really excited to be here on saturday, right? there is a lot of good football today, for any of you who have i am not sure if it is an - affliction. we did not need the show votes today.

this is a significant issue as to whether we will raise taxes in the middle of a recession. as you notice, 100% of republicans and four or five democrats also agreed that this is not the time to be raising taxes on anybody in the meantime, discussions continue. i'm hopeful we will be able to resolve this. i'm relatively confident that at the end of this process, we will go to a very sensible decision not to raise taxes on anybody in the middle of a recession. we will still discuss the length of that decision to not raise taxes. i think that is the way -- i am not admonishing all of you. i find it tiring that everybody

keeps talking about tax cuts. the decisions made it a decade ago were not given region giving people anything they don't already have. this is a debate about tax increases, whether it is a good idea to raise taxes on anybody in the middle of a recession. 100% of republicans think that is a bad idea. i hopat the end of the day, that is where we end up. i want to call on my friend and colleague for any observations he wants to make. >> the recent -- the reason uses the unemployment rate is now up to 9.8%. we need the jobs-creating sector of our country and our economy to have the proper incentives to go out and create jobs and make the investments. they need certainty. the certainty is that we should not raise taxes on anyone during economic times like these. there is bipartisan agreement that we should not raise taxes

on any wondering this sort of economic time. >> democrats are increasingly talking about tying an extension of the unemployment benefits to a new deal to continue theax cut. what is your reaction to that? >> as you know, there are questions under way. we have discussed how to package all of this. i do not think no action on a collection of related issues is a likely outcome, but i could not tell you today what will be in your out of the package. >> speaking of a problem with the taxes in the long term recession [inaudible] >> i have many faults, but lack of discipline is not one of them. i am not going to negotiate this deal with you this morning. >> the newest democratic message

on this issue is that republicans are holding hostage tax cuts for the middle-class notwithstanding the expansion to protect millionaires. this new message of theirs, is it going to have any effect? should they think that they can get anywhere by actually allowing this thing to expire? >> i would say that the election was about a month ago. clear path the spinning stage. the american people would like us to do the things that need to be done. as we indicated this week, would need to be done, what must be done, decide the tax question, decide how we will fund the government. our view is, once you get that out of the way, if there is any time left, senator reid makes a decision as to whatever else we will deal with. he indicated he will phial --

file cloture on a bunch of other matters. that is presumably to be voted on mid-week. i think it is time for the games to stop and progress to be made. today is december 4. christmas is just around the corner. it is time to wrap up the things that really must be done, should be done for the american people. >> to expect all senate republicans to vote against those measures? >> we will have the votes on wednesday. i'm optimistic we will stay on the things that we ought to be doing, which is the point of the letter we put out earlier this week. >> unemployment befits will not be reauthorize that call? >> [laughte i don't mean to be rude. next question. >> you said you is still negotiating the length of that decision. do you mean the talks going on

between you and the white house? >> the are lots of talks going on. i think it is a healthy sign now. there has probably been more conversations between the white house and senate house republicans in the last two weeks. -- last two weeks than the last two years. there's a growing awareness on both sides. there are lots of discussions going on. >> when you think a decision has to be reached? >> i don't think we have to go into the beginning of the year with people wondering if their taxes are going to gop. we need to sit down as adults and resolve. i expect that to happen. >> there is a new theme. this was a 10-year experiment that failed.

it really did not bring any benefits. the trickle-down theories did not come through. we have heard that michigan is still waiting for the trickle- down. werehey effective? >> all i can say to that is 100% of senate republicans and four or five senate democrats felt we ought to continue with the current tax rate. there is bipartisan opposition to raising taxes. i think that speaks for itself. i would also remind you that they cho not to have this debate back in september. remember when ey tught this would be a terrific debate to have right before the election? go out and debate aut taxes. whatever happened to that debate? i think there is a bipartisan feeling that the current tax rates are per. for the fort -- are appropriate for the foreseeable future, particularly with the kind of economic times we have now.

>> is there enough time this year to get the start treaty done through the senate? >> i would love to be the majority leader sunday, but i don't set the schedule. all we advises that we think we ought to do the tax question, decide how we will fund the government, and then whatever time is left, the leader has an array of things that he would like to do. he will have to decide what to do next. we will see how much time is left. >> do you know what the holdup is right now on the tax field? >> well, -- reaching agreements requires a lot of communication, and a lot of communication has gone on. >> [inaudible] >> it will be up to the majority. the house, we hear, will send over a continuing resolution.

one of the things we will want to do is actually look at it. is it riddled with anomalies? is it riddled with the executive branch earmarks? is it clean? we are going to want to look at that. the majority leader has indicated he will try to substitute for that an omnibus to try and -- which i intend to oppose. either way, it will be a really large bill and need to be scrutinized thoroughly. itill come over from the house. thanks a lot, everybody.

this morning, the senate rejected two proposals. these are democratic tax proposals. one would continue the bush era tax cuts. the second proposal would have extended all the tax cuts for anyone making under $1 million. this is a democratic effort to draw a line in the sand. they try to stake their ground on who should have those cuts continue. >> why did the majority leader want to go forward with these boats? did he not know the it would fail? >> it was clear that it would fail. this is really an effort to

paint republicans as during the sitting of the wealthy among us. reid wanted to make sure that people could -- the minority leader, mitch mcconnell, has to proposals that he once considered, and when you think the senate might take those up? maybe we can do something like that next week. the next page is moving forward in the negotiations. these votes today in the senate and last week in the house were kind of cathartic for democrats

to stick their ground, but not everyone will move forward and actually get to the serious parts of the negotiations. this has not made it very clear and that they are willing to go beyond that. maybe not for two years. this means that it will certainly play out this week . stephen sloan is a reporter was congressional quarterly.

we appreciate your time. thank you. >> president obama is flying back from afghanistan. but president biden delivered the weekly address. republican bill or senator mark kirk called for the tax cuts to be extended for all americans to allow small businesses to create jobs. he also criticizes democrats for rejecting a ban on earmark spending. >> hi, this is joe biden. i'm filling in for president obama this weekend because he's on his way back from afghanistan, where he was spending some time with the brave men and women of our armed forces. you all know it is tough. it's tough to be far from home during the holidays, especially

in a warzone, so he wanted to be there in person to thank them on behalf of all americans for their service and the sacrifice each one of them are making. and here at home, the first lady and my wife jill have made supporting military families a priority. these families are also making difficult sacrifices for our country, and they deserve our admiration and gratitude as well. our service members and their families are always on our mind, even as the president and i are working on other issues that all american families are deeply concerned about: accelerating our recovery, growing our economy, strengthening our middle class, and getting our friends and neighbors back to work. in recent months, we've seen encouraging signs on that front. after shrinking for four straight quarters, our economy has now grown five straight quarters. after nearly two years of job loss, our economy has created more than one million private sector jobs just this year. and after teetering on the brink

of liquidation last year, our auto industry is posting healthy gains, assembly lines are running again, and american manufacturing is getting up off the mat and fighting its way back. still, friday's jobs report was a sobering reminder of that. while we saw another month of job growth in november, it just wasn't enough. that underscores why it's so important to get going without delay on two things that will have the most impact in growing the economy. one -- we've got to extend the tax cuts for the middle class that are set to expire at the end of the month. if we don't, millions of middle-class families will see a big bite out of their paychecks starting january 1. and that's the last thing we should let happen. after a decade in which they lost ground, middle class families can ill-afford a tax hike -- and our economy can't afford the hit it will take if middle class families have less money to spend. and the second thing we've got to do is extend unemployment

insurance for americans who have lost their jobs in a tough economy. without unemployment benefits, families can't spend on basic necessities that are grown, made, and sold by other americans. together, the economic hit caused by raising taxes on the middle class, and denying two million americans unemployment insurance, will wind up costing us hundreds of thousands of more jobs. it just isn't smart. and, cutting unemployment insurance is not only not smart, it's not right either. it would mean telling millions of our neighbors who are out of work today through no fault of their own, that they're on their own. that's no message to send in the season of hope. we all know someone who's hit a rough patch. when that happens in america, we help him get back up on his feet. that's who we are. that's the american way. so i just don't agree with the folks who've said we can't afford a lifeline for americans

who lost their jobs during the worst recession in generations, but we can afford to borrow hundreds of billions of dollars to extend tax cuts for the wealthiest two percent of americans. that's bad economic policy, and it's also just simply wrong. congress must extend these needed unemployment benefits before it goes home for the year. and it must bolster economic growth by preserving tax cuts for our middle class. i'm glad that the house of representatives voted to do that this week, and i call on the united states senate to do the same. look, there's no doubt these are tough times. but we are slowly but surely fighting our way back, moving forward. and we're going to keep fighting -- to grow this economy, to strengthen our middle class, and to restore the american dream. that's my pledge to you. and hey, one last thing -- since the president will be back to record this message next week, let me take this chance to say from my family to yours: merry christmas, happy hanukkah, have a great holiday season and an

even better new year. thanks, and enjoy the weekend. >> hello, i'm senator mark kirk of illinois. last month, the american people sent a clear message to washington: spend less, borrow less and tax less to put america back to work. unfortunately, too many in washington want to continue the reckless tax-and-spend policies of the past. they ignore the warning signs of more debt, taxes and inflation. they embrace wasteful government spending and pork-barrel earmarks. and they think a new massive tax hike on the u.s. economy is exactly what the american people need.the current leaders of congress should not move forward with plans that were just rejected by the american people. these leaders should not raise taxes and risk another recession. instead, congress should reduce

spending and prevent another tax hike on american taxpayers. americans already pay some of the highest taxes in the world. by raising taxes in order to fuel higher spending, we threaten to restart the recession, pushing millions of americans out of work. right now, families and small business owners are >> taxpayers don't know what their personal income tax rates will be come january 1st. family business employers don't know what the death tax will be. investors and small businesses don't know what the capital gains rate will be. their uncertainty hurts our economy. it is unfair and short-sighted. congress should set its highest priority on preventing the massive tax hike currently scheduled to hit our economy on january 1st. meanwhile, our mounting debts pose a clear and present danger

to our future. it is time to cast aside our differences and work across the aisle to solve this problem. congress should set an example by ending pork barrel earmarks and cutting its own budget. this week senate democrats rejected a proposal to end wasteful earmark spending. their decision was disappointing and disconnected from the american people. in the weeks ahead, republicans and democrats should enact a bipartisan solution to cut federal spending like a presidential line-item veto, a balanced budget amendment to the constitution, and a new procedure to ensure spending reductions actually happen. in the 1980's, president reagan ann's bipartisan grace commission set the standard for serious oversight by identifying federal spending that would add little to our nation's growth but much to its debt.

mirroring a new grace submission with the authority to submit a proposal to congress for a straight up or down vote would lead to actual spending reductions. this proposal is in my first senate bill, the spending control act. harvard eek nick historian nate furg son warned that the deadline of a great power is evident when they pay more attention to mondayly lenders than defense. >> it is clear we need to cut spending to avoid a bankrupt future for our kids and our country. i believe that america's best days still lie ahead of us. if we correct our economic policy by focusing on growth and spending discipline, the sky will once again be the limit for young americans. spend less, borrow less and tax less to put america back to work. that is what we heard from the

american people last month, and that's what we should expect from our leaders today. may god bless you, your families during this holiday season, and may god bless the united states of america. >> next, remarks by new jersey governor kristi. then a white house ceremony marking the observe advance of hanukkah. after that, a report on the personal finances of members of congress. >> solomon s rushdie discusses his books sunday at noon eastern on c-span-2 and watch previous in-depth programs at booktv.org.

>> hi, i am pam, education program specialist here at c-span classroom. each year we conduct our video documentary competition called student cam. we asked students in grades 6-12 to think critically about our country. we would like you to explain how the federal government has affected an issue or event in your life or community. select a topic that interests you. once you have your topic, you can begin your research of the goal is for you to fully develop and research your topic, provide different points of view, and give footage to support your theme in a 5-8 documentary. go get started. we can't wait to see what you can do. >> find great holiday gifts for the c-span fan in your life at our c-span store, from books to

d.v.d.'s, muggsy, umbrellas and more. it is all available online. >> now, new jersey governor chris kristy on education reform. he talks about negotiating teacher pay and health care. he made the remarks monday for the educational national summit meeting in washington, d.c. this is about 55 minutes. >> well, thank you all very much. thank you for inviting me

tonight. thank you to governor bush. he has provided an extraordinary example, not just for me, but for governors all across the country, current governors, and most importantly, i think, governors to be who will be taking office in january. understanding because of his example, not only what is possible, but what is still to be done, and his continued leadership through this foundation and this effort provides not only enormous intellectual resources to governors who need that support to fight this fight, but also can point to a model of success from his eight years as governor of florida. i was honored when this invitation came in to accept it. thank you, governor. [applause] >> all of you in this room know that you're the ones who are

helping us chart a course for reform. state by state across the entire country. and we know that this issue is far from easy. it is not easy at all. but i really believe that if there was ever a time where we can transform the system of subeducation in this country, that the time is right now. and we cannot wait. we can't afford to wait. i am often called impatient by folks in my state, and i plead guilty. i plead guilty to impatience, and i will explain more about that in a moment. but this has really created a perfect storm. whether you are talking about the things that president obama has tried to do and articulate regarding education reform, the

things that michelle rie was able to accomplish in this city during her tenure, and the idea that conservative republicans like myself, like governor bush, like my senate republican leader, who is here tonight and is the sponsor of the opportunity scholarship act in new jersey, which we are going to pass before the end of this term -- [applause] >> senator tom kane. the idea that people have that much of a divergence can come together on this issue is what helps to create this moment. i've said over and over again in new jersey that this is not a democratic or republican issue. it simply isn't. in fact, i said to those folks in the democratic party who represent some of the most

ill-served children in our state in their districts with parents who over, and over, and over again vote for them, that their ignoring of this issue is unacceptable. it's unacceptable for folks like tom kanaan i -- cain, who come from new jersey suburbs where there is good public education. this is not a vote-getter for us. it is not about politics. it is about caring for those people who are never going to vote for you. i think i got about 12 votes in newark last year. [laughter]

>> butts about a commitment to public education. i tell you what i know. i know i wouldn't be standing here today if it wasn't for the fact that my parents borrowed money from both of their mothers to put a down payment on a house in livingston where tom and i both grew up, to move me in 1967 out of the city of newark and to a place where i could get a great public education. i wouldn't be standing here today if it wasn't for that. because my parents could tell me, and my mother told me all the time, christopher, if you work hard enough, you can be anything you want to be. she could say that with a clear conscience and with conviction because she knew i was getting a great education, and she knew

that i had certain god-given talents that each and every one of us have. she could say with conviction for those reasons that it was now up to me. can the children in the city of newark, the city of patterson, the city of jersey city, the city of trenton, and for god sake, the city of camden, can they say that? those parents can't. in the main, they cannot. and that is at the core of our failure. but those parents dream of the same thing that my parents dreamed of for me, but because of a system that does not nurture those children, does not educate those children, does not draw out their potential for it to be exploited, for it to be

developed, it is simply a system that is there to serve the adults, not to serve the children. each and every day in those cities in my state and others, the worst schools are continuing to be allowed to operate without any effort systemically to fix them. it is time for us to stand up and demand that the teachers, the principals and the administrators truly do what the teacher's union says they do every day, putting the children first. it's for the kids, you understand. well, it is time for us to hold them to that test. if we don't do it, if we don't change what is happening in our mediocre and poor-performing

schools, then we fail those children. continuing to play the blame game and making excuses, it only makes the adults feel better. it does nothing for the children. it is a civil rights issue as well. to me, it is the seminal civil rights issue of our time. voting is no longer the seminal civil rights issue. access to public accommodations is no longer the seminal civil rights issue. go to the cities of our country , and certainly go to the cities of new jersey, and what you will see is that it is our minority children in the main who are being denied opportunity. they are being denied opportunity by the very people who claim politically, hypocritically, to be championing them and their

cause. what is happening in new jersey? we spend on average across the state $18,000 per pupil per year, the highest per-capita in america. in the city of newark, we spend nearly $25,000 per pupil per year. yet, 104,000 students are trapped in new jersey today in 205 caronically failing schools. in 2009, 40% of new jersey's african-american students and 32% of our hispanic students were unable to meet any basic standards on the national test. 40% of african-americans and 32% of has panics. in 2009, nearly 30% of all eighth graders in new jersey,

not just our urban challenged children, but of all eighth grade students in new jersey, lacked basic math skills, 30% in i 2009. the achievement gap between nwaelete and low income eighth graders in math is nearly the same as it was 19 years ago. the gap between at-risk fourth graders and those not at risk has remain unchanged for 13 years, this despite a supreme court-ordered spending spree in new jersey that has focused nearly 2/3 of all of our state resources on 30 at >> risk zicks. the fallacy of money for quality education. if you need to refer anybody of the fallacy of that notion,

come to new jersey. no one spends more -- [applause] -- and no one is getting less. we have to be honest about these shortcomings and our own failures, both parties, over the course of the last 30 years, and we have to work together to fix it. now, what are the impediments to get this done? let me tell you a story about when i was a united states attorney. i went to visit the highest achieving public elementary school in new jersey. it is a charter school, the robert treat academy in newark, new jersey. the founder was proudly showing me around his school. for any of you who have visited, it is a once-in-a-lifetime experience.

he is extraordinarily proud, and he should be. but i met the mother there of a third grade boy, and she told me that her son had gotten in via the lottery in kindergarten. there are 4,000 children on the waiting list today of robert treat academy. 4,000 children. i asked her what it felt like the night she was sitting in that gymnasium waiting for the decision on whether her son would get in or not. she said to me chris, i knew that whether his number was going to be picked or not was the difference between my son going to college or going to jail. in kind guard, at 5 years old, a mother sitting there knowing in her heart and in her head that that decision was the

difference between her son having a chance to achieve every one of his dreams and the dreams she had for him and going to jail. in a school district that had $980 million in state aid last year for 40,000 students. it is not acceptable any longer , and we need to say these things out loud -- it is not acceptable any longer to let a teacher who can't teach stay in the classroom. [applause] wouldn't you just love it if in these 205 chronically failing schools in nouge, that when they had the back to school night, they actually told you the truth? you all have been to back to

school night. i have four children between 7 and 17. about eight our nine weeks ago we had back to school night. they are in three different schools, and they aldridge scheduleded back to school night on the same night. this is something we really have to fix. these other issues are big, but it wreaked havoc on my schedule and my wife's schedule. our youngest is bridge either. she is in second grade, and she is 7 years old. now, imagine if she was in one of those chronically failing schools, and we went to back to school night and they told you the truth. the principal would walk into the classroom and say parents, good evening. i am the principal, and i want to welcome you to back to school night. your teacher this year is mrs. smith. mrs. smith is eafer awful teacher. really, seriously, by any measure, she is not good. her students underawe chief consistently on testing. they don't like coming to her

class. she doesn't really care. she is using the same lesson plans she used 15 years ago. and no matter what we have try to do to encourage her to get more training, to change her attitude, she simply refuse toss do it. now our problem is that because of this union contract that we have in our district, we can't fire here or do anything to her. so as much as we have tried, we just have concluded that we are not going to change her. have a great year. [applause] now, of course they never say that. they never say that. but it doesn't mean it is not happening. it's happening in classrooms all across new jersey and all across america. and they call me impatient. but here's why i am impatient. my daughter has one year in second grade, one. and if she doesn't learn what

she needs to learn in the second great, she is behind in the third grade, fourth grade or fifth grade, unless i send her to private tutoring, or i get lucky and get an extraordinary teacher who spends time with her. this damages only -- not only what she wants to a chief in her life, but today. every child who is behind in a classroom knows it. the teacher asks the question, and they can't raise their hand. they are petrified. they feel stupid. other kids mock them. this is what happens. it not only kills educational opportunity. it kills self-esteem. and when we kill self-esteem in second grade little girls, it is no laughing matter, because

that leads to a myriad of other social problems that we are living with in this country. because when that little girl looks in the mirror, and she doesn't see a smart little girl, when she doesn't see a little girl who can achieve her values, who can achieve her aspirations, who can be proud to bring that great report card home to her mother or father, that's the little girl who is more apt to turn to drugs. that's the little girl who is more apt to turn to wanton premarital sex. that is the little girl who is more tending to be a mother while she is still a child. that is the little girl who is more prone to be involved in violence because she doesn't respect herself. i am impatient because i don't want anymore of those little

girls or boys in america, and every time you see a teacher's union representative say we are doing the best we can, or we can't possibly evaluate teachers in that way, or we can't possibly change or eliminate tenure, we can't possibly have merit pay, we can't possibly have school choice, i tell you who i think about. those little girls. that's who i think about. the ones who are being cheated. not only of the opportunity for a great career, but of the right to have self-esteem. i am impatient. imimpatient. it is an obscenity that those who claim to be involved in public education for the kids

aren't just as offended and just as impatient as i am. [applause] our children can no longer afford to bear the consequence of that kind of conduct. we can no longer afford the consequences of propping up an antiquated, infective model that promotes failing schools, and that is what we are doing. we know that when we give children the opportunity to get out of a failing school and into a different environment, the results are better scores, higher achievement, better education, greater self-esteem and a better future. charter schools were never meant to be the solution to the problems of public education. what they were meant to be was

unencumbered laboratories for innovation and experimentation and then gauging success, and then taking that model and applying it to the broader public school system. that is what charter schools were meant to be. we have done some of the first part and none of the last part. what is happening in charlie schools in new jersey, offense, 70% of new jersey's charter schools are charter high schools. they had a higher 2009 ra are graduation rate than the district average. it is not an argument for more charlie schools. it is an argument to apply the lessons learned by the charter schools and getting that to the school system. that means tearing up the union contracts. that's what it means. [applause]

11,000 students on the waiting list for charter hifles? new jersey. 11,000. now, you know all the issues, and i'm not going to bore you with going through a litany of them. merit, tenure and reform and elimination. accountability in the classroom. shared sacrifice by everybody to try to remake this system. we are doing these things in new jersey. we are fighting to do them in new jersey. and whether it is expanding parental choice, trying to make sure that you reform the leaders of our educational system, superintendents and principals who seem at times to care more about how much they are making than how much they are achieving. and in new jersey, pin ball from district to district to get higher and higher salaries. and crazy school districts in

new jersey, especially the suburban ones, who believe the more they pay their superintendent, the more valuable the school district must be. this conspiracy among superintendents is extraordinary. you are seeing it play out in new jersey now because we have imposed a cap on superintendent pay. being a superintendent of schools is a hard job. when it is done well, it is particularly hard. but i will tell you this. it is no harder than my job. now i make $175,000 a year. so i said how about this. you don't make anymore than me? [applause] and if you want to make more than this, here is how you do it. you are eligible for up to a 20% bonus on top of that for objectively measured accomplishment by the students in your district. if you achieve, i will pay you.

showing up for work is not a good enough excuse to get more and more money. think about this. 70% of the superintendents in new jersey make more money than the governor. 70%. now, imagine this. in the conspiracy of superintendents and elected school boards, the cap goes into effect on february 7th. any contract which expires after february 7th, the new contract must conform with the cap. what is happening across new jersey right now? [laughter] folks who are in the middle of their contract getting five-year contract extensions at salaries over the cap. superintendents of schools writing on-he had pieces as if they are disinterested observers. for the first time in their lives upset about the awful,

onerous arm of government coming in to interfere with the free market. [applause] >> imagine this. i am being sued today by a school board who wants to give their superintendent a salary higher than the cap and is spending taxpayer money to sue the governor and the commissioner of education to get the higher salary for their superintendent despite the fact that dozens of citizens showed up at the school board meeting to protest it. this is dr. leroy sites in new jersey, who i have now crowned the new poster boy of and arrogance in public education in new jersey. [applause] >> but as this fight is going

on, let me explain to you that he is getting company. people are competing in new jersey for me to give them a new title. [laughter] why is this fight important? because shared sacrifice is going to be required of everybody to fix the system. it is not that we don't have enough money. we have more than enough money in the system. it is just that the money is being spent so infectively, so inefficiently, and again with the focus on the adults and not the children. we have to fight it at every level. so if you're going to talk about the teacher's union, and i know what you are here for. don't worry, i will get to it. if you are going to talk about the teachers' union, you have to talk about the people who are failing in leadership, who are being overpaid for that failure, and who need now to have the good ones stand up and

say i will be part of the sacrifice in order to repair the system and make it better for the children who we are supposed to be serving and their families who are paying the bills. [applause] now, of all the different things that have gone on in my first 10 months as governor -- i was walking out of the state house on wednesday, the day before thanksgiving, with my wife. we had just gone to a soup kitchen in trenton together with three of our children to serve some pre-thanksgiving meals to some of the least fortunate in the capital city. we went back to the state house afterwards. to leave the state house, they walk me out threw a side door, to the basement, and walking down to the long ramp to get to the bottom. i was walking down and my wife said to me -- this is the way you go every day? i said yeah. and she said this is the ramp you told me that like some

mornings you feel like you can't get up the ramp. i said yes, this is the ramp. i said the 10 months feels like it has been three years. i thinks the nature of the governorship in new jersey. great authority and great responsibility. but as i was walking out with her, we talked about some of the kids we had met that day in the soup kitchen, kids who were public school kids in trenton, who were being grossly failed by that educational system. it made me think on the way home about all the things that you are thankful for in life on the day before thanksgiving and how much of a responsibility we have to fight this fight, that i can't afford to be tired, and i can't afford to be discouraged. the people didn't hire me because of my charm and good lucks. [laughter] they hired me because they know our state's a mess, and they wanted somebody who they hoped thought, trusted would have the

backbone to actually do something about it. so when you become governor of new jersey, you go to the state house for the first time as governor, and you drive down state street in trenton. some of you have been there. state street in trenton is a historic old street lined with cobblestone and small little brick front and stone front old homes that have now been converted into lobbyist offices . [laughter] not exactly shangrila. [laughter] >> but what strikes you when you go down state street for the first time as governor is that this -- there are all these small buildings, except for two. the state house, the second oldest continuously operating

state house in america. and right across the street, the palace built by the new jersey education association. and i mean a palace. a five-story brick and glass palace built with $130 million in deuce that they collect a year. $130 million in dues a year. you say well, if they collect $130 million in dues a year, they must contribute to their members' salaries. no. if they collect $130 million a year, they must be contributing to their members' pensions. no. $130 million a year, they are kicking in for their members' health benefits. no. what do they do with $130 million a year? how do you get to that number first of all?

$731 in mandatory deuce per member per year, deducted from their paychecks by the state of new jersey, by statute free of charge, and wire transferred directly to them, because we want to make this as convenient as possible in new jersey. [laughter] 200,000 members. so you all can do the math. now also by statute in new jersey, do you have to be a member of the teacher's union if you are a public school employee. that is incorrect. i'm sorry to call you out here in the speech, but that is an incorrect answer. you can opt out. but if you opt out, you must pay 85% of $731 to be out. by statute, 85% of the dues must be paid by someone who wants out. now for people of my

generation, governor bush's generation, this is like the hotel california. [laughter] you can check out any time you like, but you can never leave. [applause] so what do they do with this money besides build a palace across the street. well, they have an executive director. he makes $550,000 a year. they have an army of in-house lobbyists, who senator cane will tell you every time the word education is mentioned in a bill or discussion inside the state house, there are three or four lobbyists sitting in the front row staring at every one of those legislators to remind him or her, "we are here, and we are watching." they make lavish campaign

contributions to those members of the legislature who toe the line and against those legislators who dare to speak out. and, since march, they have spent $8 million on attack television and radio ads in new york and philadelphia against me. now, some people may see that is a pretty good expenditure of money. but i think they need to get a refund, because in that time from march to today, my approval ratings have gone from 42% to 55%. [applause] today the disapproval rating of

the teacher's union in new jersey is 59%. disapproval. [applause] >> how does this happen? it happens because of what we need to do. it happens because we are shining a bright light on who the union is and what they stand for. this is no longer the time to believe that we can play by some delicate rules. they don't. now when i came to trenton, i was new to the school yard. so, i walked out on to the school yard like any new kid and made my observations. there were a bunch of elected officials, bureaucrats, laying on the ground, bleeding, cowering and crying. there was one person standing

up. that's the bully. that is the bully in the school yard. and you have a chance as governor of new jersey. every governor for the last 30 years has walked out on to the same school yard, and you have a choice. you go up and you try to sidele up next to the bully and try to make friend with him. you try to tell him i disagree with a couple of things, but not that much. you try to get them not to dislike you too much so they don't punch you. that is the path that has been chosen by many of our governors of both parties over that period of time. other you walk-on to the school yard, and you say you punch them, i punch you. [applause] you come in, and you say, "you protect lousy teachers, i'm

going to tell the public about it." you come in, and you say, "you are getting 4% and 5% salary increases in a zero percent inflation world, and i am telling people about it. in new jersey, the teachers demand free health benefits from the day a teacher is hired, for her, him and their family, until the day they die, and they get it at the expense of the state of new jersey. and you tell preem -- people about it. as i have traveled around the state over the past 10 months, they are amazed. they say why does it cost this much money for this education. i have one answer for you. njea, that is why it costs so much money. and it doesn't do anything for the kids. they will tell you it is for the kids. that is their slogan.

it's for the kids. well, let's go back to bridge either, -- bridget, my second greater. say she comes home from the first period. she hand me her report card sheepishly. i open it up, and it is not good. i say bridget, what happened here? you're smarter than this. what happened? dad, i can't concentrate. i can't focus. you can't concentrate? why not? i hurt that you are not giving ms. smith her 5% raise this year. [laughter] and you're not giving her her free health benefits. dad, i can't focus. [laughter] if you would just give her that 5% raise and her free health benefits for her whole life, i

swear i would get all a's. stop the madness. [laughter] >> you all laugh. this is the crap i listen to in new jersey. [laughter] >> this is the argument they make every day. when i ask them during a time of unprecedented fiscal crisis in the last year to take a pay freeze for a year and to contribute 1 1/2% of their salary for health benefits. for the average teacher this would mean $750 a year for full medical, dental and vision coverage. the njea called that the greatest assault on public education in the history of new jersey. i tell you these stories for two reasons. one, i want to elicit your sympathy, first. [laughter] to be really clear about that, i want to elicit your sympathy.

but secondly, i tell you that so you under what we are up against. we are up against people who are playing out of yesterday's playbook. we are up against people who believe that people still believe this garbage. we are up against people who think if i just say it is for the kids and i put nice tv commercials showing perfectly lovely and wonderful teachers, that parents will be the dopes that we are and say well, all right. it's for the kids. lay pay it. let's not fight. i don't want to anger my teacher. i see her in town. i have to go in for the conference. i don't want her to be mad at me. when we tried to fight against the school budget this year -- and we vote on every school budget in new jersey district by district. the passage rate has been 74%. new jersey people are generous. 74% average pass rate. this year we said you don't take the pay freeze, you don't

take the contribution to your health benefits, we are going to urge the people in your town to vote no on the budget. i did this in the way that i normally do things. someone asks me in a press question, if they don't take the pay freeze, what do you suggest the voters do? this is two weeks before the elections. i said i don't know. i would vote against the budget. i went back to my office in princeton. and governor bush will tell you this. when your chief of staff is waiting for you in your office, this is never good. and i have a very reserved, very bright, very soft-spoken chief of staff. i walked in, and he said so, how did the press yelps go? i said it went great. so i hear we are against the school budgets. [laughter] i said yes. and he said you know that the last thing they passed was a

74% raise. he said maybe this is something we may have benefited batting around a little bit before you decided to do it. i said well, it just made sense to me. [laughter] so sympathy for me, empathy for him. i said well, we had better go out and win. so we went out, and we told people these facts, and we said to the unemployed carpenter and electrician, and plumber, and pipe fitter, the person in middle management who lost their job to corporate downsizing, to the folks who had their hours cut back at their business, to the folks who hadn't gotten a raise in five years, we said we value teachers. the great ones should be carried on our shoulders every day to school. we should pay them what they deserve and more because they care about our kids, and they are doing a great job.

but we are tired for mediocrity, and we are tired of paying because someone fogs up the mirror every year. so here is what we have to do. if they are not willing to be part of the shared sacrifice, vote no on the school budget. the night of the school elections, they don't cover them on tv. my wife and i are sitting in our living room with the laptop, and she looks at me as the returns start to come in, and she says you know, buddy, this could be like the shortest tenure as governor of all time. like three months in, and you could wind up being dead meat in about an hour. i said well, let's see what is going to happen. we watched at county by county and district by district the results rolled in. people are getting it. 59% of the school budgets were defeated in new jersey that night. [applause]

the highest number in the history of the state. we are right. we are right. [applause] and the public knows it. it is time for us to not worry about how clever our arguments need to be of the of course we need to strategize politically and be smart. but we should never forget the fact that we are right. and the power of this issue is that we are right to the suburban mother, like my mom, who wanted their child to be everything that he could possibly be and told them all they have to do is work hard. we are right to the single african-american mother in newark who was afraid that her child would go to jail if he didn't get into the charter school. we are right to the hispanic immigrant who comes to this country looking for something better for his children and believes that america's education system is going to provide it to his kids.

we are right for the teachers who know lousy teachers when they see them, who break their backs every day to be good and better, and who watch in silent horror, silence enforced by a union that cares only about political muscle and influence and discipline of their members , watch in silence as they get paid the same amount as the lousy failing teacher down the hall. we are right for those people, too, and they know it. they may not put a bumper sticker on their car, and you bet they are not hanging my picture in their classroom. but they are the ones who come up to me at the soccer field, and at the supermarket, and they shoe store, and the delhi, and come up to me close, and

they whisper, i'm a teacher, and i'm with you. [applause] that kind of coalition, ladies and gentlemen, creates a moment, and we cannot let that moment pass by. we cannot let the enthusiasm and intensity with which our leaders have been discussing this issue diminish in any way. our children need us to remember that they are the future of our public, and they need us to remember that the media's attention, which is on this issue right now can be fleeting. our children need us to remember the generosity of folks like mark zuckerberg of facebook, who in my state at 26 years old decided that he wanted to help transform the

school system for the future of the kids in newark, and by dozens of other people, many of whom are in this room, who believe that their lives and their fortunes are worth investing in this issue, we have to remind our children that those folks are with them. our children need us to remember that bipartisanship can work when it is focused on results for them and no for us. our children need us to remember that those of us in charge can't back down from the status quo because it's roots are deep and the special interests are entrenched and backing down only emboldens them. the old way no longer works, and every day that passes has a real and unacceptable

consequence for not only our kids, but for future generations of children. now we have to engage in the fight, and each of us has to take up our individual role, whatever it is, because failure cannot be an option here. it simply can't. i would rather lose an election. i would rather lose my career than look back and realize that i didn't do enough for the future lives of the children of my state. now listen, this is -- [applause] i tell people this all the time. i'm getting the oil portrait in the state house. like that is done. i won once, so i am getting the big oil painting. [laughter] when i walk out to do my press conference, i see tom's father all the time. he has the painting. i see all the other recent

governors. all we are arguing over now is the little brass plaque now at the bottom. does it say four years orate years? that's all that is left. [laughter] so here's the thing. when i bring my grandchildren back to the state house, and i show them that painting because i want to prove to them this crazy grandfather was really governor. they are not going to believe it. my own children don't believe it at the moment. when i show them that painting, they are going to ask me what did you do, grandpa, what did you do? i don't want to say first, let me direct your attention to the little brass plaque at the bottom of the painting that says eight years. not a minor accomplishment for a republican in new jersey. i say well, i got the eight years, and to get the eight years i had to compromise my principles. i had to get in bed with some special interests that i didn't

approve of. i had to incrementalize, and i had to suppress my own personality. but eight years on the plaque, kids. eight years on the plaque. i don't want to say that. i want to be able to say, whatever that plaque says, i want to be able to say to them every day i was in this job, i was thinking about whether you could live here, whether you would want to live here. the same way that my parents got to get in the car and drive 25 minutes to watch my kid play baseball. the same way they have to get in the car and drive 25 minutes to go to that christmas concert or that spring play. the same they got to get in the car and drive 25 minutes to go to that little birthday party that you have around the kitchen table, where they got to take the dozen pictures of the kids blowing out of candles. that's what i want. my parent had it.

i want it. i don't want to get on an airplane to go see my grandchildren. i want them to be in new jersey. i am one of the most blessed people in the world because i get a chance to make that happen. i don't have to leave it to fate or chance. i get a chance to make it happen. so whatever that plaque says underneath it, i want them to say that that is what i was focused on every day, not just for me, but for them, for their friends, for the other children in new jersey who wanted the same thing themselves. they wanted to achieve every one of the dreams and aspirations that they had and wanted to believe that when their parents said to them you can be anything you want to be as lock as you -- long as you work hard enough, that it came

c-span 3. that is not only up to me, it's up to all of us. we have to stand together. this is the fight worth having. we just have to have the courage to do it. we have to have the courage to care more about children than we care about adults. we have to have the courage to stand up to those people who say it is not possible. we have to have the courage to not care about how we will be judged in the short-term, but to care only about how our children will judge us, because they will. every generation judges their parents. governor bush's father was a member of the generation we called the greatest generation. he got to make a judgment of what his father was willing to do at a moment when our country

was at grave risk. and it set up for him, i suspect, an extraordinarily high standard of what was expected of us because of the example they set, because of the covenant they kept to leave this place better for their children than it was left for them. we will be judged, too. what will they say of us? will they say at this moment of maximum crisis in america's educational system that we buried our heads in the sand, that we assuaged ourselves with excuses in our creature coferts, that we said our problems are too big and complex, i cannot make a difference, and someone else will have to solve it. or will our children say of us, they stood up, they took risks.

they were counted. they put their money and their effort and their heart where their mouth was. they kept that greatest american covenant, to leave this place better for our children than it was left for us. if that does not motivate us, then we have failed as americans, and we have failed as human beings. we cannot accept that failure. i will not accept that failure for me, and i will challenge every one of you and everyone i can speak to not to accept that fail our either. this is our moment. it is time to seize it so we can keep that covenant. thank you all very much. [applause]

[captions copyright national cable satellite corp. 2010] [captioning performed by national captioning institute] [applause] [applause] >> hi. i am pam, educational program

specialist here at c-span classroom. each year we conduct a video documentary called student cam. it asks students in grade of-12 to think critically about issues affecting our nation. this year's theme is washington, d.c. through my lens. we would like you to explain how the federal government has affected an issue or event in your life or community. select a topic that interests you. once you have your topic, you can begin your research. the goal is is for you to fully develop and research your topic, provide different points of view and provide c-span footage that supports your theme in a 5-8 minute documentary. go get started. we can't wait to see what can you do. >> the ceremony marking the second night of hanukkah was held thursday evening at the white house. white house. the president and