senate will relativity's. in the house, the lead negotiator for democrats say they will not hold up the compromise. good morning this monday morning, december 2 -- december 13, congress returns before what could be its last legislative week before the holiday recess. the play to push for a vote for the nuclear arms treaty with russia and the administration is assessing the afghanistan war. it va federal judge is expected to rule today on whether the administration's health law violates the constitution. the issue of whether the tax cut deal represents a compromise is part of a piece this morning in "the new york times." this idea that you have to be a moderate to govern. the question for all of you. the phone numbers are on the screen -- we will get to your phone calls and just a minute but a little more from the column this

morning.

what do you all think? do you have to be a moderate to govern? it goes on to say, the article this morning, that --

that is his opinion this morning. san antonio, texas. bobbie, democrats' line. what do you think? caller: to answer your question, i do think these days you have

to be a moderate. but i wanted to make a quick statement. it is amazing to me how the democrats will lake -- wait until this last moment to try to pass this bill and they had both houses. to me, it just makes no sense. host: before you go. you said you need to be moderate. why do you think that? caller: i think if you are for it -- too far to the left or isht in today's times it hard to get legislation to pass. that is what i think. host: california. jeff is and it did -- independent. are you there? at the i punched the wrong one. if you can, call back in or we will try to get on in just a minute. on that tax cut deal expected to come through the senate this afternoon, that key vote, as many papers are putting it, is expected at 3:00 p.m. eastern time. you can watch live at c-span2.

here is "the washington post." it says -- host: the senate is hoping to

complete the tax bill on tuesday. fresno, jeff, independent line. go ahead. caller: i always felt that both parties have their points of view, and i always wished that when one party was in power that they could pass some of their points of view that i actually agree with and when the other party is in power that they can pass some of their points of view. an example. i believe we do need some type of health care and i do believe we need probably more green jobs, but on the other token i believe that immigration should be stronger than it is. so, i believe both parties have their ideas and i wish they could govern that way. i am not sure if that is moderate or not. host: seattle, washington. david, democrats' line. caller: let me put of luck --

put it like this. when george bush was running the country for that eight years he was not a moderate and was a conservative and basically ran the country into the ground. we elected barack obama specifically to get us out of the ditch the republicans put us and and then this tax bill which basically is trickle-down economic theory all over again. my thought as a liberal -- if the conservatives govern as -- governed as conservatives than liberals made to govern as liberals. host: presumptive speaker of the house john boehner sat down with "60 minutes," and he talked about the issue of compromise. here is what he had to say. >> we have to govern, that is what we are elected to do. >> governing means compromising. >> it means working together, it means finding common ground. i am not going to compromise on my principles nor am i going to compromise the will of the american people. >> you are saying i want common

ground but not going to compromise. i don't understand that. >> when you say the word compromise a lot of americans look up and say, they are going to sell me out. so, finding a common ground i think makes more sense. then i reminded him that his goal had been to get all the bush tax cut -- tax cuts made permanent. >> -- >> the did compromise. >> i found common ground. >> you are afraid of the word. >> i reject the word. host: do you have to be a moderate to govern? santa fe, texas, on the independent line. caller: this whole thing, i think you do have to be a moderate to more or less government. and there has to be will on both sides to do this. but the republicans, if you look at what the man in the senate has to say, he is not going to

pass anything until he gets these tax cuts. john boehner saying almost the same thing. how do you come to any agreement that has anything to do with both sides? i agree with the democrats -- these tax cuts should not go through for the upper people that are making the upper 2%. and where all the tea party people these people. so, where are they when they tried to -- they want common ground but yet they want to go one way. that is my opinion. host: are you still there? caller: yes. host: you are an independent so i assume you voted for republicans or democrats in the past. who do you think represents the

moderate faction of the party, one person who sticks out? caller: there is nobody on the republican side. i really believe, because they would not be doing what they are doing. and on the democratic side, mr. obama, in their light he was going to change the world but all he has done is change. so, there is nobody i really see at the present time that can do anything, to tell you the truth, because they are not going to be let to do anything. host: and mention it in his column of the idea of mr. bloomberg, the your city mayor, running for president. he was asked about that. >> do you think an independent could be president? >> i don't know. i am not going to run for president. i have a great job. i will finish my 1100 or

whatever days to go. and i will leave politics to the expert. >> do you think it is possible to scrap the two-party system? >> the original founding fathers did not seem to have an interest in party politics and i worked very hard in new york for nonpartisan elections. i will give a speech before an organization next week about non partisan redistricting. party has a place the party loyalty i don't think should get away -- in the way of what you as an elected official things. >> you said you did not want to run for president yet based on all of my reporting, you are taking a serious look at this, doing calculations about whether this could be something you could actually win. are you saying you are not even looking at the possibility of running? >> no, i am not looking at the possibility of running. i am going to speak out on those things that affect new york city. that is my job.

people say you should not be talking at a national level -- we created 55,000 private-sector jobs in new york in the last 12 months. much greater than the percentage we should create it our population. but we cannot do anything without help from the federal government and the state government. talk about immigration, regulation, the president out there selling our products -- >> if someone came to you saying, mr. mayor, this would not just be a vanity plate that you could win this thing, would you change your mind? >> no way, no how. >> your support is to create all of this budget should cease and desist? >> i do not think most of them to put it this bud's. yes, they should cease and desist, but most of this -- most of it is just because the press wants something to write about. bottom line is i have a great job and i want to go out having a reputation as a very good, maybe the greatest mayor ever, and i am lucky to of three

predecessors -- guiliani, dinkins, and koch who have all been helpful in making me a better mayor. host: "the washington post" with this headline.

one of those votes will take place today at 3:00 p.m. over the tax cut deal and many of you watching the senate floor on friday saw the senator from vermont mr. sanders talking about eight hours. we cover the whole thing. you can go to our website c- span.org and our video library or you can also search within the transcript of his eight hours for certain issues to the certain buzz words, that you like to hear him talk about. st. louis, missouri. do you need to be moderate to govern? caller: i think you do. to me, a moderate is someone who can compromise. and even though there are things you don't like, there are other things that are very important that they want to get done, so

they have to compromise and take the things that they don't like in order to get the good things that they do like. and president obama is looking out for the middle-class americans and the republicans are not and if anybody thought that his crocodile tears on 60 minutes was anything but crocodile tears i am afraid that they better think again. and i hope that these people are happy with the tea party and who the tea party got back in. host: are you happy with the tax-cut deal president obama negotiated -- are you there? are you happy with president obama negotiated? caller: absolutely. it is helping the american people. for two years we can accept because what has to be because of the republicans in order to

help the middle-class. host: tacoma, washington. ethan is a republican. caller: good morning. i thought, i do think you have to be a moderate to govern, especially in this lame duck session. the senate looks like it is moving toward as a whole in these issues -- one to get out before january 3. but easily to bring anything to the table thereafter would be seen, anything else in the negotiating table. host: long beach, new york. joe is an independent. good morning pretty caller: i really don't understand the question. you don't need to be a moderate to govern. you have to understand what the problems of the united states are to fix them. we were the world's greatest power, the world's greatest economic power. we had an enormous industrial base, manufacturing base that

won world war ii and then brought prosperity to this country that the world had never seen before. and we took the economic base and send it overseas. give your jobs away. take them. goodbye. send them overseas. now we are sitting there, 15% unemployment, $14 trillion debt, no money -- no manufacturing, no jobs and we are saying i wonder what the problem is. maybe we are not moderate enough. are you kidding me? du? host: i was on to estimate question. -- i was going to ask him a question. robert, go ahead. caller: how are you this morning? host: doing well. caller: you have to be a moderate in a way to govern. but i don't agree with the compromise. i think the republican party gave it away when they get 13

months away. and they did not get paid for. they went back on their word. host: what was their word that they went back on? caller: they said they would not have any more debt -- and is piled debt up without being paid for. host: were you part of the tea party movement or a supporter of the tea party candidates? caller: yes, i was. host: so, you don't like this tax cut deal? caller: not all of it, no. host: what do you like? caller: the bush tax cuts ought to be voted up and down. on not to be any add-ons. and if mitch mcconnell does any votes on this with add ons from the democratic party, he might add on his resin to -- resume for another job. host: let me get your reaction to this, "wall street journal" editorial on what was put into this tax cut bill.

the hawkeye handout. what do you think, robert? are you still there? caller: i did not think you need subsidies for ethanol.

host: de think there will be backlash from tea party supporters -- do you do think there will be a backlash from tea party supporters? caller: i think there will be, yes. host: what should happen? caller: i am not sure what will happen but host: you mentioned earlier senator mitch mcconnell should resign or he might be voted out. caller: yes, on the extension of the 13 months of unemployment -- host: ok. caller: he did not have it paid for. host: in your opinion, these ethanol subsidies cannot rise to the same level as the extension of the unemployment benefits? caller: not on this particular bill. a bill of to be a stand-alone bill without all of the add ons. host: sanford, florida. allen is a democrat. caller: how are you? host: doing well. what do you think of the question? caller: i did not think you necessarily have to.

going back to what you talked about, the senate during the time of lyndon johnson when you could peel off moderate republicans and conservative democrats sometimes defected from in him. part of the problem, the way the party is working out, only the extreme and the party's vote, it is in the party's best interest to hold up things and to play to adjust their based -- their base. i think it is happening more on the right but i am sure it happened on the left, too. for example, talking about the tax-cut deal. there are things in it i do not necessarily like. the ethanol subsidies, i do not necessarily like some of the tax provisions but i think -- i do not want to see taxes on working families go up, i do not want to see unemployment benefits lost, so i think sometimes you

have to take things, accept things that maybe you don't like to get things you do like. it is not necessarily about being a moderate. there used to be a time -- where people could be principled members of their party but take votes and do things that were not necessarily popular. ted kennedy, nobody accused him of being a moderate -- tip o'neill or ronald reagan, but they were able to get things done. that has to do with a sense -- there used to be a sense that people were really working together even though the -- what i talked about before about the way the parties are and the way people vote because they are playing to the extremes. host: that was allen, a democrat from sanford, florida. do you have to be a moderate to govern? we have about 20 minutes left.

i wanted to show you the front page of "the baltimore sun." former lieutenant governor of that state -- state michael steele says he will make his plans known tonight about whether he runs for a second term as the gop chief. his plans are still a mystery and he is scheduled to have a conference call with members tonight where he will announce his plans. michael steele on the front page of "the baltimore sun" this morning. the next zero call is from mclean, virginia. fred, independent line. caller: i think the way you frame the question and i think the way a lot of people are commenting misses the cynicism of the opinion article that you read. i think it was really more to the effect, do you need to be a trying year later -- triang ulator.

it really manipulating both sides against its other and dangled just enough carrots for americans to do not want to give up anything so their representatives can get reelected in our continuous election cycle. host: let me read a little bit more from the piece in "the new york times." the users, go byrne -- thomas coburn as an example of someone who sticks to his conviction yet can govern.

what did you think about that? caller: i guess he is a counter to the larger point i was making and maybe he does stand out as an out liar then pared -- allied air -- outlier then. i am not as familiar with his electors. but in the larger case, but congress house members, they did not have the freedom to stand their ground unless they play the middle. host: louisville, ky. jimmie on the republican line. you are next. caller: how are you doing?

i think it would help to be a moderate to govern, but i think the democrats lost their chance when they fail to vote on the tax cuts and everything before the election. they did not vote on it because they were afraid if they did they might get voted out. now that they got voted out -- i think obama got the best that could with what he had left. he did not get more because the democrats were afraid to vote before the election. now that they lost, they want to cry and holler. and i think it is all the democrats thought that obama didn't get what he really wanted. -- it is the democrats''s fault. host: also during the "60 minutes" interview john boehner was asked about the back and forth between the democrats and

republicans, and the use of the word hostage. >> he basically called you a hostage taker. >> excuse me, mr. president, i thought the election was over. people love the heated rhetoric during the election but now it is time to govern. >> do you think his tone will make it more difficult for you to come together as we move forward on issues, or are you just looking it off? >> i've got a thick skin. and a lot of words did said in washington and you have to let them run off your back. the president was having a tough day. >> understanding -- >> i have a tough day from time to time myself. >> later in the interview it became clear that the president jack as hostage takers had bothered him. >> there have been moments of disrespect shown to president obama. >> there has been disrespect shown to me yesterday by the president. host: talking about whether not you have to be a moderate to govern. here is an e-mail from robert

who writes in -- new york, jeannie, democratic line. caller: i believe this country does not need a moderate ruler. the way it is going, gop and corporate america is holding us all hostage. reaganomics is destroying our country and a bush tax cuts is a souped up version. i did not know why nobody believes that taxes is good. nobody lit -- nobody believes which attacks as but every american worker and still has a job, their taxes are taken out and payroll, they have no choice. they can't wait until the end of the year to say i want a tax

cut. host: any part of the deal you like? caller: there isn't. it as an american we are willing as middle-class families to pay a little more in taxes so the 2% pays what they need to pay. host: i want to get your reaction to "the new york times" front-page article about how the tax-cut bill benefits the middle-class. the most expensive component in addition to the continuation of the marginal rates -- the li

what do you think, what is your reaction? caller: to the last part you just read, for one thing, not that many people in this country itemize. we are not that rich. we have two economies. one struggling and dying and another that is in disneyland. and the disneyland portion is the one coming into washington in a few weeks. i got to say something right now -- i watched "60 minutes" last night and i listened again this

morning and i believe the american medical association should look at the actual competition same of john boehner -- boehner -- host: john boehner. caller: i did not mean to sound angry but i am angry and sometimes my words might not be so high, i don't sound like an educated person but i not stupid. i do not believe the american public is stupid. i believe we are just distracted by corporate media. distracted by all of the shows and the games and all of the money. we need a social >> alongside a capitalist. host: coming up in about 15 minutes we will be talking to the financial services forum about president obama's outreach to ceo's. meeting with some of the countries top ceo's on wednesday talking about the tax cut deals and other provisions. you may be interested in that segment.

portland, oregon. charlie, republican michael caller: good morning. to be athink you need moderate to govern. i guess it doesn't hurt. we have two wings of basically the same party, the same big government party trying to get their bills passed and have a little bit more control of their portion of society. if you are a moderate and you can compromise your ideals and your principles that it helps to get your stuff passed. host: pelosi walked tax-cut deal tight rope is the headline in "the wall street journal" this morning.

that is "the wall street journal" this morning. also in "the washington post" this morning -- is a ban on earmarks really needed? hawaii and north dakota had more earmarked than any other state in 2010. mississippi could lose the most, it plural -- pulls and 11 times as much earmarking funds as it sends back to washington. catherine is next, independent caller. caller: i don't think you need

to be a moderate to govern and i don't think that compromising with someone who disagrees with you necessarily -- compromising your principles. i think you look for common ground. here is where i think that perhaps the tea party, although i disagree with them -- with a lot of their ideas, their position on debt is one that i agree with and i think that maybe president obama and tea party can find some ways to reduce the debt together. that is what my hope is. i was disappointed in this tax bill because we have been fighting two wars for almost 10 years and still have not paid for any of it. and i think it is time as americans perhaps that we look

to pay our debt and also instead of crying about jobs going overseas, maybe even tried to buy american. it is difficult these days but you can still find things. host: did you hear the "60 minutes" interview, a little bit that we showed where mr. boehner is asked about what is the difference between compromise and common ground. in your opinion, what is it? is a bigm not sure there difference between compromise and common ground. in a compromise, well, this is not exactly what i wanted. but it is going to be what is best for the country. that way you did not compromise your principles because if you are leading, you need to look beyond your personal or party's

desires. i don't know. thank you very much. host: cleveland, ohio. democratic line. caller: thank you for taking my call. for me, compromise vs common ground. common ground is the tax bill. the tax bill that they negotiated should be for the highest good of all americans. that is the common ground. the compromise is when you are idealistic and you give up a little bit of your ideals so both sides can come to an agreement that most people in this country benefit from. and another fact i don't want us to forget is that the super rich were going to get a tax cut on their first $250,000. to often we leave that out of the conversation. it is the bonus tax cuts beyond that that we are really having a

disagreement about. so far as president obama's decision is concerned, he is responding to an over- propagandized electorate. all we hear is propaganda. we are not getting the truth. we are now getting the facts. i have voted for john boehner twice in the past. i also voted for reagan -- even though i am a democrat. and i am so sorry, i have to ask all of my fellow american citizens to forgive me. host: all right, we will leave it there, pauline. in her first interview, the new justice of the supreme court elena kagan sat down with the c- span as a talked-about how technology helps her to manage heard oral argument legal briefs. here is a little bit from that interview. >> justice scalia had taken to putting his brakes on an ipad. how are you managing the braves?

>> i have a kindle that i put them on. i heard justice scalia saying he put his on an ipad. but mine is on a kindle and i sometimes shock them around just in hard copy. i do both. but it is endless reading. because many of these cases, not only the parties submit briefs, but there are many, many organizations and individuals and governments who are interested in the case, so they will set that friends of the court briefs. so some of these cases there will be 40, 50 briefs. there is a lot of reading. that is a big part of the job -- and if a kindle or ipad connected easier, it is terrific. host: we will show you more of that interview today and the

full interview airs sunday evening, december 19, and the updated supreme court documents, which many of you are familiar with, will air on sunday, january 2. for more information go to c- span.org, and you can also find our supreme court page on our website. sarasota, florida. john on the republican line. talking about whether you have to be a moderate to govern. go ahead. caller: good morning. i see it's like this. you have to be a moderate? i mean, it takes a lot of different views to come up with a solution sometimes and if you are looking at it from different avenues, may be collectively that is what -- the outcome is supposed to be something done. the problem that we have and that we are facing right now is people in congress talking about people holding hostage -- we

have 535 members of congress and this administration holding 310 million americans hostage is really what we have pared -- we have. everybody is screaming about rich and poor. let's talk about that. if president bush signed -- not talk about tax cuts, talking about tax increases that will happen on the american people. apparently obama and the other people in congress think that's -- think that if you pay taxes, period, 1 cent, 10 cents, you paid too much and obama seems to think if you gave any federal income taxes you are making too much money. let's talking about rich and wealthy. shaquille o'neal, the basketball player, he is rich. the guy who signed his paycheck every week is a wealthy man. the rest of us are working. and congress is pretty -- we

have five kinds of of 35 members who did not do anything, they don't have any accountability, they don't get anything done. in 2008, all of congress a 2008 war supplemental bill, the congressional body decided they would give themselves a pay raise in the middle of the night in a war supplemental bill designed to buy bullets to kill bad guys, to prevent you from having to wear a burqa, having to hottest -- jihadists running around in our streets. host: the size of congress, that is the headline in "usa today."

texas, clinton on the independent line. talking about whether or not you need to be a moderate to govern. caller: yes, i do think you have to be a moderate to govern. the extreme positions led to what is so harmful to america. for example, when you take a position of, increased debt, it is extreme. take on positions of increasing taxes, that is extreme. when you support stimulus packages and public spending programs, those other things matters extreme and harmed the economy. on the other hand, when you run on social issues -- when you support don't ask, don't tell,

it is an extreme position to hold and light of all of the evidence against don't ask, don't tell. you have to govern whiff social tolerance and fiscal responsibility. moderation. host: two stories about ron paul. of the front page of "the new york times." he comes in from the cold. within "the financial times" is another piece. said it unlikely to sway from its qe2 rollout. >> the that, a headline, "u.s. award on currency crisis." -- "warned on currency crisis."

two stories about congressman ron paul. the last fall called. robert, democratic line. pennsylvania. go ahead. caller: ok. american people need to wake up. if this doesn't tell them that everybody in that white house is bought off by the rich -- they need these rich people for their campaigns. and ever sent -- since they pass the supreme court ruling, how many billions spent this campaign just for the republicans? host: since you brought that up let me bring two articles of for our viewers. at the front page of "usa today" -- 7 incoming leaders saw $1.2

million uptick. then in a "the washington times " this morning, this story. the anonymous donors spend -- spent $132 million. caller: that is why the tax thing did not get passed early on because they need the people. we need to get rid of them -- mcconnell, all of them. host: that was robert, a democrat from pennsylvania. that does it for our first segment on "washington journal." in about 45 minutes we will turn our attention to those be told -- detainees at guantanamo bay. there was a provision put in the house bill that would bar the use of funding to bring the detainees here to the united states for a civil trial. up next, first discussion on economic issues and the obama administration's leadership with the business community. a little bit ago we showed you part of our interview with elena kagan, the newest justice of the supreme court. here is a little bit more a part

talking about her impressions of john roberts as an advocate before her court -- the court and also now as her colleagues on the bench. >> talking about argument and listening to some of the recordings of last year's cases, interesting to hear your colloquies -- i guess the right word -- with the chief. wondering about how your aunt -- about your intellectual relationship because often your questions and answers were very rapid-fire and i am wondering what you think of the intellectual relations of between the two. >> i have extraordinary respect for him. he was the great supreme court advocate of his time before he became a judge. so, i always felt that he could do better what all of us as lawyers were trying to do. and he did it as well as anybody had ever done it, to be at that podium and make an argument to

the supreme court. that is a little bit intimidating, to know the person questioning you has also stood in your shoes and really has done the job better than anybody else ever has. i listened to the cheeks arguments and i talked to a lot of people who saw his arguments and he was fabulous. he is also a great, great questioner up on the bench and he really challenges you, as he should. he doesn't let you get away with anything. if there is something that you want to hide in your argument, he is probably fairly certain to find it. i tremendously enjoyed arguing in front of him because you had to be at the top of your game. and you should have to be. here is a little bit of a story -- when i walked in the form by swearing in -- this was in the summer, before my bigger, grant,

public investiture, the swearing in necessary in order for me to start in the summer to actually do the work of the court, i was met by the chief justice and he gave me a little bit of a tour of the inner rooms that the justices go to -- the conference room that the justices meet in and the robing room and the dining room upstairs. on the tour, he showed me the robing room, and there are these wooden lockers and it goes from chief justice and then it said justice stevens and then went on down. and alas locker was just as the sotomayor. then we walked around the building and little bit and he showed me some of their rooms and maybe we took about 15 minutes and we ended up back in the robing room again and in

that 15 minute time, what happened was justice stevens' name plate had come off and all of them went over one and now there was justice kagan and then he showed me the new locker with the name plate. it was a very effective way to say to me, well, you are here now. you are part of the community. part of the institution. it was a very powerful thing to see. susan swain sat down with elena kagan -- in her temporary chambers and the supreme court building. the entire interview, her first, will air sunday evening december 19 at 6:30 p.m., 9:30 p.m., and 1230 and a documentary will air sunday, january seconds. go to our website, c-span.org,

you can see the supreme court page. joining me now at the table is robert nichols, president and coo of the financial-services forum. i want to begin with the whole tax-cut bill because that will be on the senate floor this week and maybe in the house. i just want to show viewers a "the wall street journal" on friday. the headlines -- companies calling to cash. coffers swelled to 51-year high as cautious firms put off investing in growth. there is a piece in "the new york times" about the deal. while it will cost a lot, it is likely to get very little bang for the buck. tax cuts for the wealthy will barely be spent at all and even middle-class tax cut won't add much to spending. guest: well, i don't agree with

him on all the elements but i've will provide maybe some big top line observations. but albert had a poll last week that talk about bipartisanship -- bloomberg had a poll last week about bipartisanship and i think this is a good first in that direction. my view is a higher tax on capital would discourage investment, and this deal would make sure there is not a higher tax on capital. if there is a higher tax on dividends than might be -- companies might provide less dividends that could hurt investors across all income streams. seniors, of course, gaining the lion's share of dividends so this will protect them in that area. there are a lot of folks that have a philosophical disagreement with raising taxes during a recession. another observation, small businesses, of course, are huge job creators and many small businesses file as individuals so this would keep taxes on small business is down.

there are a lot of differing views on that agreement but i actually think it is an important first step in bipartisanship. also, "the wall street journal" today had a survey that i did not know if you -- if the obscene, they interviewed a group of economists all across the ideological spectrum and asked what your views on the economies are now. they asked them to after this tax bill was announced. the majority of these economists have a more rosy scenario, they actually think gdp growth will be actually greater next year and a chance of a double-dip recession are less. in terms of taking a bipartisan step toward helping the economy move forward i actually think this is probably a good first step in that direction. host: "the wall street journal" headline this morning. president obama will convene a one-day summit of corporate chief executives wednesday as part of a renewed white house effort.

the second paragraph of the story -- nine why are companies holding on to the money? guest: they were on the summit. first of all, we think it is actually a very important thing. we would like to see that the week -- and the relationship between the business community and the administration strengthened. we would like to start in the new. obviously there have been frictions between some industry sectors and the administration over the last couple of years. we would like to see as a fresh start. we do see it as a common goal, getting the economy moving again, getting people back to work. that is a critically important policy priority that the private sector and the public sector shares. to get that, to make that happen, for capital to be deployed, part of what we are looking at at the business community and financial certainty -- sector is certain date. anything from capital

requirements, implementation of that frank -- dodd-frank. all sorts of built -- building blocks the business committee is looking for to help deploy capital. part of it is the man. demand is not where we would like to be pared from a financial sector standpoint there is a lot of debate over lending. why aren't you lending. we have the regulators saying we have the financial institutions to lend prudently. and at the same time you have some folks -- other policymakers say, lend more, lend more quickly. it is a balancing act that the financial sector is trying to straddle. host: if companies need certainty and this tax cut bill is only two years, does it mean companies are still going to hold onto their cash and will not be investing it? guest: companies are looking to invest.

banks make money through lending. companies will make money through risk capital. so there is the desire to invest. it just want to make sure there are the right set of economic circumstances and that isn't in the public and private sector should look to together. host: does the tax cut bill lay the foundation question of guest: it certainly moves us in the right direction. obama they need in order to reinvest some of the capital? guest: i think a couple of the

key things to move the economy forward, one is there needs to be a long-term approach to the debt and deficit outlook. a sunday talk quite a bit about in the program. it is a critically important issue. the path we are on is not sustainable. secondly and some and we have not talked about much in the last couple of years is the idea of global engagement agenda or new trade agenda. we are about 5% of the world's consumers. we need to open up export markets. the president had a very noble goal, to double our exports or so in the next five years. it is critically important. cannot agree more. we would like to get -- there is colombia, panama, south korean trade agreement that the president successfully negotiated. he deserves praise for doing that. the next step is for congress to act. but i think the trade agenda is one thing critically important so that for the manufacturing heartland, to double our exports, for our service providers, that is something that is a critically important step in terms of the building blocks i referenced earlier. host: of the tax-cut deal is a positive, the trade deal is a positive. does this mean frictions are easing between the white house and ceo's? guest: time will tell. i would like to see this be sustainable, something that happens with a lot of frequency, to have a two-way dialogue. it is not just having a meeting and then you go your separate ways, it is sustained dialogue,

it continues, the ability to live a thoughtful voice as public policy is being created on both sides of pennsylvania avenue. i think it is a great thing the president is doing. i just hope it is sustained. and it really evolves into a two-way dialogue. host: talking about the obama administration and his outreach to the business community. he meets with ceo's on a summit. california. allen, democratic line. caller: good morning. i just wanted to say thank you for giving me the information -- did not know about all of that. one question that still keeps coming up. everyone keeps want to talk about creating new jobs and taxes to help the economy stimulate itself. but no one is talking about the minimum wage in which people are getting jobs and it is not enough to sustain us for the jobs would be better handled. the minimalusly,

wage is not an element of this deal. of course, an extension of unemployment insurance is for those who are hurting and still struggling to find work. host: is this something your group agrees with, extension of unemployment benefits? guest: one thing that we have actually done, our group a couple of years ago put out a policy paper talking about ways to help those that are transitioning, those that are out of work, looking for new jobs and trying to modernize some of these rather antiquated ways that the government, the federal government, uses to conceptually, we care for everyone who is to lead to find a job. with unemployment so high, that is a heck of a lot of people. we actually think this tax deal that the president and congressional leaders, conceptually, it is very thoughtful.

host: what is the financial- services forum? guest: we are a nonprofit financial organization comprised of the chief executives officers of the world's largest financial institutions. host: was sort of companies? tesco baker of new york melon, a citibank, j.p. morgan, goldman sachs, among many. host: yukon, oklahoma. bill, go ahead. caller: i want to know when these tax breaks, who will be a benefit to the country, when they have been in effect for 10 years already, will actually help people? guest: one thing that this has done is make sure that there will not be a tax increase on americans starting in january. i think that is an important

element of the deal. as "the wall street journal" noted, as a result of that, they think there is a likelihood for stronger gdp output next year. part of this is inoculating ourselves perhaps against an economic blow. host: democrats critical of the bush tax cuts say that more jobs were lost during that time, and they do not see the tax cut bill helping the economy. guest: obviously, we have come through a very sharp economic circumstance, in terms of the subprime housing crisis. we have gone through the sort of blow that our economy has not seen in decades. unfortunately, it will take some time to work through that.

action that the fed took years ago to what they are still doing, as well as the dramatic steps that president bush and president obama has taken, altogether, have lessened what could have been a were set of economic circumstances. i take your point about the pain and frustration of getting onto a stronger growth path. host: a new congressman in charge of this watchdog over the fed. he said that there is a currency crisis looming. is that something that you agree with? well that topic come up? guest: i do not have the agenda, but i will say one thing about ron paul.

i think the fact that he will have these oversight hearings are sensible, justified, and important. one thing that i would hope for is that the fed stays independent and that we allow them to be independent. we see in other parts of the world there is political interference on the central bank. that is not a direction we want to go. i respect mr. paul, these hearings over the their quantitative easing, actions they are taking to put us on a growth path, but we are not in a currency crisis. obviously, the dramatic steps that the fed has taken over the past several years is a hot topic in washington, and for good reason, but i do not think we are in a currency crisis.

host: who is going to have a seat at this conference? guest: the financial sector, there will just be one or two. it should be a diverse group of industry sectors, and i look forward to seeing the full list the white house will release tomorrow. host: we have a list here of those that received an invitation. next phone call. erie, pennsylvania. tom, you are next. caller: i have a plethora of comments and solutions to the problems the nation faces. these outrages the cdo packages -- if these are such geniuses,

they could take their money and start their own company, and, you know, create competition in the marketplace. it would also create jobs. the u.s. negotiates trade policies to the benefit of the people in the upper economic spectrum and it is all the gobbledygook. everybody wants to do business with the u.s. why do we have to do these policies, tax plans that are one-sided? guest: first on trade, i would have a slightly different view. i think it benefits all americans, not just certain income brackets. our nation has benefited

dramatically from opening up the global marketplace. in terms of compensation, there have been dramatic changes. the higher you are, the more compensation you are getting in stock, aligning their pay with the long-term performance of the company. so there have been some changes there. i also

large, with a lot of the elements to it. i would not want to put aside other industry sectors, other cottage industries that might be able to employ people. host: part of the meeting will be reforming the tax code. what does the business community want? thatesident obama bush's he wants congress to overhaul the tax code, what does he want? guest: this is a top priority. it is a complex tax code. as a former colleague of mine said, it is held together by bubble, and rubber bands. what generally the business

community and average american, is looking for is simplicity. there is a drag on the economy in that sense. a more simplistic code probably makes sense. host: what is complicated for businesses that needs to be simplified? guest: we would like to bring money back to the u.s. we think that is a positive piece. the burden on small businesses is rather robust. there are some things that you can do, things that your average business person would trade off for simplicity. so yes, there is a lot congress has, a lot of targeted things. what the policy makers in both parties will be looking at over

the next few years is trying to get rates down as we try to exchange these provisions that impact every element of our economy. host: robert nichols is our guest, president and ceo of the financial-services forum. miami, florida. lucy. democratic line. caller: good morning. i would like to know how it is that people are being able to lose their home. a few weeks ago i saw the president on "oprah."

they were asking him about how he was going to help these people. i am not talking about myself but there are many people. host: what is your question on the housing industry? caller: i lost my home through foreclosure. i have nowhere to go. i am in bad shape. host: your view on the housing industry? guest: obviously, many sectors of our economy are still in recovery. different parts of the country are doing better than others, as you well know.

some of the sandy states, the recovery is happening much slower. i think she referred to an interview with "oprah" -- i did not see that, so i cannot comment on that. florida is one of the areas where the housing sector is struggling. some of the western states as well. unfortunately, that will take some time, which is hard for people like lucy to hear, but part of our work with congressional leaders, they are trying to give some assistance

to americans who need help. host: next phone call. tennessee. caller: good morning. a couple of things. i heard on one of the political shows that one when they are looking to pay for this is to take from the social security trust fund. that is one of the reasons why this deal should be killed. secondly, i heard you rattle off the names of the people in your forearm. -- forum. i do believe that a couple of them took bailout money. quite frankly, i do not think people who took bailout money should have a seat at the table. host: your response?

guest: let's talk about that, t.a.r.p. it was very unpopular. the american taxpayer has earned $35 billion in income as a result of that program. i will acknowledge it was tremendously unpopular, even though it was the right thing to do. credit should go to chairman bernanke and secretary paulson for coming up with a plan that kept us out of a very bad economic situation. t.a.r.p., acknowledging it was very unpopular, it was one of the most successful and popular programs in decades. to your question on security, there was the deficit commission. they talked about the need of putting social security on

sounder footing. president bush in 2005 also attempted to tackle this. to your point on social security -- this is critically important in terms of unfunded liabilities. we need to get back on a path of sustainability. as we begin to tackle our long term debt -- host: but it is ok to take from social security in the short term? guest: i do not know if that is the case. i do not know that this is coming out of social security, but we need to put that on a path of sustainability. what the president and congressional leaders have made a judgment on is, doing this deal, for long-term economic prospects, it is much better to do it than not.

host: another tweet from a viewer -- perry from arizona. you are next. caller: good morning. what i wanted to say was, if anybody wants to come here with money, come to america. we will lower your taxes. we want to create jobs. the other thing i want to say is we already have socialism in america. we should think about what we have. the government should be cut back dramatically. in order to create jobs, we need to get the government back to where it should be, protecting

us from internal and external aggression, the way the founding fathers set it up. the reason why the economy is going down, why we will become a third growth country, if we continue down this path, is simple. we are losing our liberty. the government is way too big. obama is putting in more irs agents into the health care plan. host: i think we have your point. guest: i actually agree that the government is too large. it has grown in the past couple of years. i understand why the government has grown, because of these

capital concerns, but we need to get on a path where the government can shrink. earlier in your point, you made a point about tax rates, where we should be compared to other nations. that is an important point. if our corporate tax rates go up too high, over time, that can impact corporate behavior on where you deploy assets, facilities, resources, and your industrial plant. host: when republicans take control of the house, spencer bachus has said that one of the first agenda items is to roll back the dog franc financial regulations bill. -- dodd-frank financial regulations bill. guest: spencer bachus has a huge

portfolio that he will be inheriting. let's talk about the bill. there are good pieces of public policy in terms of systemic supervision. that was something we did not have. also the idea of having resolution authorities, putting an end to too big to fail. heaven forbid we have an interconnected financial institution that were to fail. taxpayer money would not be behind it, and it can be wound down in a way that would not affect the taxpayer. there are some other provisions in the bill that word misguided. one idea is the interchange fee. i do not know if he know much about that provision, but they put a cap on the amount of debt card fees that could go toward any individual point of sale transaction. there are a lot of causes of

the financial crisis, pagers, regulatory failures that led to it, but that is probably not one of them. host: why is that a bad idea, if you are going to protect consumers from things that they do not know about? guest: it is more to go after making sure that there is protection of your identity. going back to spencer bachus, some of the things he will focus on. one critical element that was not contained in the legislation, that the chairman wants to focus on, is the idea of gse reform. host: fannie and freddie. guest: that is right. the role of the government and our federal housing finance system. host: should fannie and freddie

be forced to liquidate, compete in the process? guest: that is exactly what spencer bachus will tackle. we will be interested to see how that goes. the forum has not come up with a proposal there. to your question about the dodd- frank bill, acknowledging that there was a lot of good, what many people are looking at is implementation of the bill. if the legislative process was framing the house, now the regulatory process will say, we know where the bathroom is, but we do not know the color of the tile, what the faucet's will look like. that is something that the house financial services committee will oversee. everything from the implementation of the vocal role -- volcker rule, to the

role of the cftc, fcc will have, going forward. so regulators will have to hire more people. some will have new officials, a new senate appointment. host: death on, pennsylvania. john, democratic line. caller: i heard your just use a term that the republicans are using in order to pass this tax cut bill. he said he thinks all americans should have this tax cut. that sounds so good. who could be against that? but here is what is happening. he represents the hedge fund managers on wall street, the

ones that make hundreds of millions of dollars a year, that a 15% taxes. me and my wife are retired on $50,000, we pay 28% in taxes. so when he says we think all americans should enjoy a tax cut, he is putting me in the same boat as the people making hundreds of millions of dollars a year. guest: actually, john it is mistaken. we do not represent any hedge fund managers. that is a separate group. i understand his point about tax rates. the different ways income is taxed. that is valid. that goes to how you develop tax

policy, and that is a tricky thing to do. but we do not have any hedge fund the folks in the financial services world. host: next phone call. brian, you are on. caller: everyone seems to be ignoring the elephant in the room. in the iraq and afghanistan conflict has put us in trouble and has caused the dollar to drop, which has caused oil to go up. the second thing, this capital gains tax, when we lowered it, it was like a cell for the industry -- sell out for the industry. they get certain equipment that they can would have normally had to pay capital gains on. jobs went down the tube.

the move everything overseas because of nafta. i think what they should do is raise the tax on the rich, lower taxes for the industry, as far as industrial income tax, raise taxes on capital gains so it is hard to sell your business off, and maybe level the playing field. host: hang on the line. i want robert nichols to answer your first question. actually, it is he correct? guest: i cannot speak for the entire class of businesses across the country. i assure some did. however, government revenues went up as well. there was income to the government which we're able to put to use in other programs.

host: are you still there? caller: i knew that was going to be his bottle. that was a temporary thing. that is why we had an influx of revenue. we no longer have that in flux and we are steadily going down. you do not pay off your debt by not having money to pay it off. cutting programs across the board is going to hurt millions of americans to just make sure that the top 1% is taking care of. that is ridiculous. guest: president obama and congressional leaders have made the judgment in this deal that they would not like to see taxes go up for all americans in january. to your point, we have come

through a nasty set of economic conditions. it has been very hard on your average american, the business community in general, as well as the economy globally. policy makers are trying to do their best to come up with a series of answers to get us back on the path to growth. this is a good first step, but there is a lot more that needs to be done in terms of the long- term deficit picture, having a trade agenda, all sorts of regulatory pieces, how we treat capital requirements. that is a very technical issue for the financial sector that will directly impact the degree of lending you see in our economy. there are a lot of things that we would like to see happen. one point is the need to have both parties in washington work together. that would be a great start.

but we would also like to see more public-private sector working together. . nelson from cape coral, florida. caller: the biggest crisis looming over the nation is the threat of having the u.s. dollar not be in the world currency reserve. that is something the banks should be keeping their eye on. unfortunately, i think the banks are corrupt. it used to be, if a bank was caught money-laundering, the fed would come in and allow another banker to come in and take over. today, all of the major banks

have been caught with laundering, and all i have to do is pay a fine. having the world -- the dollar not stay as a world currency is something that this country is not ready for. guest: you are probably not surprised to see that we do not agree on everything, but where we do agree is on the importance of the dollar remaining the buzzer currency. i do not see a threat of that happening in the short term, but that would be troublesome. -- reserve currency. and that is a benefit to our country, something that we should be working hard to preserve. host: robert nichols, thank you for being on. we will turn our attention to a

report on financial literacy. up next, what is next for guantanamo detainees. first, a news update. >> michael steele is expected to announce he will not seek reelection when the committee picks a new chairman next month. friends say that you never know, but has sent the signal that he will drop out. he has scheduled a conference call for tonight. on the other side of the aisle, steny hoyer, in prepared remarks for this morning said, "it is easier to borrow and leave someone else with the bill, it is easier to stir up a cultural war and cultural resentment. all of those tactics are tried and true and poisonous to our future." the majority leader speaks in an

hour at the national press club. ahead of a senate vote to extend tax cut, treasury bonds are fallen to their lowest level since june. economists expect the tax cut to increase the size of the budget deficit. dow jones futures are up 34. more on "the wall street journal" from a survey conducted. economists now see a stronger growth of gdp in the second half of the year. admiral mike mullen, in remarks to troops earlier in iraq, said he does not foresee a big change in the number of forces fighting in afghanistan. the obama administration plans to begin withdrawal next year. >> tonight, federal trade commission president john leibovitz on how to handle online privacy and potential do

not track privacy. >> i am the education program specialist. each year, we conduct our video documentary competition called studentcam. we asked students grade 6 through 12 to think critically about issues facing our nation. we chose this topic because every would like you to explain how the federal government has affected an issue or event in your life or community. once you have your topic, you can begin your research. the goal is for you to fully research your topic, provide different points of view, and include c-span video in your argument. for more information, visit c- span.org. we cannot wait to see what you can do.

host: devon chaffee is our guest, advocacy council for thei human rights work group. the senate is expected to consider a provision this week that would block the obama's --inistration' what with this provision do? guest: it would prohibit the ministration from using funds to transfer any guantanamo detainee to the u.s. for nine months, the length of the funding provisions. what it would essentially do, in many cases, it might prevent the administration from seeking

justice at all in many of these cases. it is tantamount to obstructing justice in many of these cases. the administration has identified approximately 35 cases where they believe should be brought to trial. many may not be able to be brought to trial except in a civilians heading. the alleged criminal conduct was, in fact, not a war crime at the time that the conduct was committed. if the military does not have jurisdiction over these cases, and congress moves to prevent these cases from being heard in the u.s., these criminals may never be brought to trial, and the victims of their crimes may never see justice. host: this provision bars the transfer of any funds for any detainee in prison for nine

months. so effectively, guantanamo bay will not be shut down for at least nine months. guest: there are many obstacles the administration is working to overcome with the closure of guantanamo. there are over 130 detainees that are set for repatriation and the administration needs to find countries for them to go. clearly, bringing those that should be brought to trial is a huge obstacle to close in guantanamo. there is no reason why, if there are cases that have been identified, that the administration should be able to move forward in this case, in this an error that is most -- in

the venue that is most prepared to handle this type of thing. it is the civilian courts that have the experience in dealing with these cases, given with the sensitive information, the complex information that arises. host: a blog on "the washington post" describes --

your reaction? guest: i would say, first, the case that you are referring to, the east african embassy bombing, he was convicted on one charge. many of those charges were dismissed, but he was convicted, and he faces 20 years to life in prison. moreover, in that case, it demonstrated that many of the concern that folks are concerned about did arise. none of them are rose in the trial in manhattan.

there were no disruption to the community. that case did move forward smoothly. i think you to see the administration coming out -- we heard from eric holder. the white house has come out strongly against a provision. i think the battle is far from lost, at this point. it is still uncertain what language the senate will use in the spending provisions. there is talk that the senate made strip out the senate language from the continuing resolution and propose entirely new spending legislation. we see the administration opposed this provision. it is clear the attorney- general still want to have the option for civilian trial on the table. host: "the washington post" notes that at least one democrat who is influential indicated

he wanted this stricken from the final legislation. guest: his opposition to the provision is very important to know, being a senior member of the committee that will be working on the senate version of the funding language. i think there are many like senator leahy who have come in the past, been supportive of civilian trial, the use of civilian trowels as an effective means to combat terrorism, but also preserving the president and administration's prosecutorial authority to decide the most appropriate form for these cases. this would be an unprecedented restriction on the administration's ability to move forward with criminal cases in a

particular forum. it is unusual for congress to step in and say you cannot try cases in a particular course, and prevent the administration from pursuing justice. so i think you hear a lot of members of the senate who are concerned with this idea of restricting the president from being able to move forward with trowels in any given form. host: you said the the administration opposes the language in the house bill, but "the washington post" editorial this morning disagrees with you. it goes on to say this --

guest: certainly, you cannot say that there have been no trials under this administration. i think there is a lot of frustration on the lack of progress. the administration has had the authority to bring individuals into the united states for prosecution for over a year and has that acted on that. it is understandable there is frustration around that. this issue should not be politicized. we are talking about burning individuals to justice, -- bringing individuals to justice, in some cases, for the most serious actions taken against the in that it states. we have -- united states.

we have seen the attorney- general speak. in his opinion, they have the evidence necessary to move forward in these cases. host: we are talking about what is next for guantanamo detainees. can we afford the risk to our national security to let the detainee's go? guest: when you talk about risk of releasing detainees, you have to think about the comparison of the risk of holding them. we have seen a number of national security experts, including from past administrations, who have stated that guantanamo is a recruiting tool for terrorism. you have seen secretary gates

boys this conclusion, that guantanamo is a national security liability, and closing it is a national security imperative. in regards to the director of national intelligence report, it is not clear -- those reports are hard to verify, they are hard to confirm. they did not list names. it is impossible for any outside group to verify the allegations made. in the past, we no reports about recidivism have included actions taken by detainee's such as writing editorials, participating in documentary's about their experience,

categorized as return to the fight. there is a question of whether or not that is an accurate number. it is almost impossible to verify. host: according to "the new york times" the latest numberinforman on detainees -- devon chaffee is an advocacy counsel at the human rights first group. norman, your first. go ahead. caller: this all started with george h.w. bush when he went into panama. we do not deal with governments that all political prisoners, but we consistently

hold political prisoners. now we have these so called enemy combatants that are not fighting for any government. every war in the past has been between governments and not people. guest: i think you give a good point, citing the example of noriega. he stood trial, a civilian trial, and was convicted. in his case, there was a refusal to treat him as a warrior. instead, the government decided to delegitimize him simply as a criminal. i think that is one of the arguments for why these cases -- from a national security standpoint, from a standpoint of delegitimizing terrorists and

their support groups, who are --eking more your status, warrior status, you are simply reducing them to a criminal. host: next phone call. caller: if you have cable tv, watch tru tv. you will find out at 9:00 central time, this coming friday, this 9/11, this war that

is going on and continues, was a government cover-up, and it is with jesse ventura. host: that was more of a common than a question. next phone call. ross. caller: i am wondering why terrorists are not brought to court, in world court. their actions have affected not only the united states, but the world. i was also wondering if your guest has ever visited guantanamo bay? guest: that is an interesting question, your first question regarding why terrorists are not being held before world courts. that is an issue that has been raised by some who think the forum for criminal trials, such as the international criminal court, should be expanded to try

acts of terrorism. that has not happened to this point. there is not an international forum for trying these cases. that is certainly an idea out there. unfortunately, that form the not exist at this moment. to your second question, i have been there a number of times. my organization goes down to observe the military commissions, so i have periodically gone down there. although we are not given access to detainees, we do not have interaction with them, but we have served the military commissions process. what i have found concerning, watching these proceedings, it is very evident that this is a new system, a system that is untried. a system where there are unanswered legal questions that have been answered for decades inside the united states.

that is one of the obstacles that has been preventing the military commissions from moving forward in any meaningful way and is one of the concerns, reasons why the regular federal courts are a preferred venue for these types of cases. host: what types of questions come up at these commission that would not at a civilian trial? guest: one example, when i was down there, khalid sheikh mohammed and the other 9/11 defendants, he asked the judge if he pled guilty, could he faced the death penalty? the judge could not answer the question. it seemed like a pretty simple question. it is a question that has long been answered, here in the u.s.,

but because of the way the statute was written there, he could not answer. there are also questions about when the military commissions actually have jurisdiction over certain crimes. there are certain enumerated crimes, such as material support terrorism, conspiracy, that traditionally had not been considered as war crimes. so there is a question as to any types of convictions to these war crimes would be upheld by the court, even if they were to succeed at a lower level. host: has the death penalty question been answered? guest: we have not seen an answer to that question, to this point. host: next phone call. oliver. you are next. caller: i am deeply impressed

but concerned by the sheer length of time that this process has taken. on some legal issues, it might seem reasonable that this thing progresses' at the rate of 11 months at a time, but when we are talking about individual lives, people who have been incarcerated for eight, nine years, it seems to me, this is an egregious human rights violation in itself, and that should outweigh all other considerations. we do not know, at this point in time, whether they are innocent.

guest: i think you raise an important point. we are coming up on the ninth anniversary of guantanamo being opened in january. i think some of the individuals are being improperly held. a number of them have won their habeas claims in u.s. courts, which means the administration does not have a lawful basis to continue to detain them. and it is going on for an incredibly long period of time. certainly, these individuals reservdesert remedy for these hn rights issues, and steps need to be taken in order to facilitate the closure of the facility, and to end the legacy that guantanamo has come to represent. host: tweet from a viewer --

guest: as i stated before, over 400 convictions have occurred since 9/11. civilian courts have dealt, quite adeptly, with acts of terrorism. the now-convicted times square bomber was sentenced to life in prison in october. we have seen a number of cases in the past year where the fbi has used the regular civilian system to pursue terrorists. our normal justice system has not been inhibited from gaining intelligence. they have been able to go forward with these cases. they have been able to secure individuals who are now facing life in prison. what we have seen in the military commission is it is

untested, and tried -- untried, and the risk for a sentence being overturned through an appeal. it is clear our regular federal courts are the preferred venue for doing so. host: are more suspected terrorist being transferred to guantanamo? guest: no, at this point, the administration is not sending any detainees to guantanamo. it has said a number of times it is committed to closing the facility. i think that commitment is important to our allies abroad. that is important to us being

successful in our operations abroad. our commitment to close guantanamo is very important to our allies, important to assure our allies that they can cooperate with the u.s. in terms of intelligence, detention, and they do not have to risk being complied with what they violation of their human rights obligations. host: next phone call. caller: i wanted to congratulate the young lady, your guest, for bringing to light some of this in senate that -- insanity that seemed to be able to go unabated. i want to know why there is resistance at two public trials. there is an attempt across the media and in political

structures, as it exists, to keep the primary reason -- to begin with, the word terror can be applied to anyone. you can walk down a building in minneapolis and open fire and it is terror. it is basically the resistance we are dealing with. any one of these deranged individuals would glad they trade their satchel for an f-16. host: so what is the question? caller: when will we address the crux of the issue, the israeli- palestinian conflict?

guest: i do believe the issue of public trials is one of great importance. we have seen in military commissions, and our experience as a human rights commission, access to those commissions is very limited to the public. there are select media that go down there, select observer groups that will go down to observe the trial, but by and large, the families of the victims of these trials are unable to see the perpetrators be brought to justice. there would be increased transparency and access to victims and family members. i think you saw that in the trial of the east african bombings. they were in favor of using the

civilian court option, and remained so, even after he was convicted, one that is transparent, one that allows the host: the jurors convicted and one could have life in prison. when will they settle that issue? guest: there is expensive information that can be -- expansive information that can be settled by the judge that was problematic at trial. host: mike, independent line. caller: thank you, c-span, and good morning. i have a common and then the question. first of all, when president obama came into office and said

he wanted to close guantanamo bay, everybody was with that. but when they want to move these inmates to the united states, nobody wants them in their state. my question is this, are they willing to hold a civilian trial in, say, a military complex like fort dix or any other military post? guest: i think that is a very good question. i think that is the option of holding a civilian trial in potentially a military installation is one that the military is considering, and should be considering. you are correct in identifying the political issue. there is a lot of "not in my backyard" top when it comes to where these trials should be held end in the localities where

local politicians have been in favor of bringing them into their territory, there are some limitations because of many restrictions. but certainly, all options are on the table in terms of using a military facility. host: in the language in the house bill that passed last week, it also included a provision that you are talking about, building a facility in the united states. guest: that provision would limit the use of funding for building a facility for housing the detainees. presumably, you could use an existing facility for a civilian trial. i fort dix might not be the location, but there are a number of places with quarter is where you could presumably hold a

civilian trial. in the house bill last week, in the constructing of a new facility for housing the city's, presumably this was -- for housing the detainee's, presumably this was the facility in illinois. most of these detainees would not be brought to civilian court for a civilian trial. we have prisons and there would not really be the need to construct a new facility. host: we are talking about this headline in the paper this morning -- it would put a ban on the transfer of new taye -- new

detainee's. arizona, at ford, republican line. your next. caller: i have three comments and one question. guantanamo bay should remain open. and why snatch defeat from the jaws of victory? why the extra money to retry this terrorist? host: thank you, and word, for your question. -- guest: thank you, edward, for your question. i do not think you see it on the battlefield in afghanistan were soldiers are taking people into custody that you see them aggrandizing them. i do not think that is what we are talking are today. as far as khalid shaikh mohammed

and the other 9/11 i think that those attacked and their family members want to see justice done. they do not want them to be held preventative lee under some law or just in detention indefinitely. they want to see them brought to justice. the best and most sure way of doing that is by bringing those individuals to trial in our regular federal courts. khalid shaikh mohammed at an indictment facing him long before he was ever brought to guantanamo. for the 9/11 victims and their family members, the best chance of justice is, in fact, reduce civilian trials. host: how much -- here is a tweet --

do you know the cost difference between a civilian trial and a military commission? guest: i do not have those specific figures. it is an expensive facility to have down there. and the military commissions in particular, those are quite an expensive undertaking. you are talking about bringing down judges, attorneys, journalists, ngo groups down to guantanamo every time there is a proceeding. it is quite a production. organizing the flights, burning them all down there often and innate -- bringing them all down there often and any discussion between the attorneys and judges. it is an incredibly costly endeavor as opposed to holding them here in the united states where there would not be a question.

the attorneys would simply be able to go to visit the individual there representing when necessary. -- a day are representing when necessary. -- ordaz visit the individual they are representing when necessary. host: next call on the independent line. caller: i'm from westminster -- west chester, pennsylvania. a school teacher, he was decapitated and it is interesting that you are saying these people should have human- rights. and it is funny that americans are always out fighting trying to decide what other should have. these cultures have been a ground for thousands of years. we want to fight for the rights

of everybody. we need to worry about getting our own people more often and stop having bleeding hearts forever body else. host: this chafee, and a comment? guest: certainly, human rights are important to me and to my organization, human-rights first. many acts of terrorism are some of the worst human rights abuses that you could identify. i think what we are talking about here is we are talking about holding those perpetrators of terrorism to account and bringing them to justice. in many ways, we are talking about the rights of victims of the acts of terrorism. host: hawaii, alan, democrats. caller: it is kind of a hard situation all over the place, but i guess the cia has their

own layer of prisons and i do not know if any of them actually still exist in the media. sometimes it pops up about poland, lithuania, all kinds of facilities that we have concealed for torture and interrogation. what do you do? besides gtmo, some of the worst cases may have been moved out of gtmo over to another facility. those people may be bad people, but the question is, how do we deal with those people and how do we decide what facility -- what to do with the facilities that have been established? guest: i think you bring up a very important issue and that is, a legacy of abuse of detainees in u.s. custody, including torture.

on his second full day in office, the president did issue an executive order that closed all of the secret a cia facilities and mandated that the red cross be given access -- access to all of the detainees in u.s. custody. there's no question of the ongoing continuing sites today, but i do think the past existence of those sites and many individuals at guantanamo were, in fact, held in those facilities and subjected to abuse and that is relevant in holding these individuals accountable in court. part of the reason that many of the counts against one man in particular were dismissed, although he still faces 20 years

to life in prison, part of the charges were dismissed because there was an issue of the evidence because he was abused, because he was tortured. that is the result of these past policies of torture and abuse and these other illegal treatments. down the road when you are attempting to seek a conviction it is an obstacle. quartered evidence is not allowed in the military commissions, just as -- tortured evidence is not allowed in the military commissions, just as it is not allowed in our records. -- regular courts. host: next call is republican, you are on the air. caller: i just want to say to the woman, ms. chafee, is that

correct? guest: yes. host: you need to look at the human-rights -- what about women in afghanistan that are beaten and tortured? these people are the enemy of the united states and their objective is to kill you, me, and any other american. i say they do not have any rights. they forfeit their rights. they gained 20 pounds per month on average in guantanamo bay. they are furnished a koran. you talk about torture and i think there should be waterboarding for everybody down there. guest: i think this is more about us and our values, american values. it is about the united states and what we want to stand for and it is about them. -- than it is about them.

do we want to ignore our core values and the rights that are encompassed in our constitution in our approach in the fight against terrorism? i think that our values, many have stated, including general patraeus, that our values are one of our best tools in the fight against terrorism. that includes a value that we do not torture. it is against u.s. law. and it is considered -- it is against our international legal obligations. and it is something we do not do as americans and is something we should not do. it makes us stronger that we embrace those values and that we fulfill those volumes in our counter-terrorism policy. host: the advocacy counsel at human rights first has observed the military commission proceedings at gtmo.

mr. chafee has a law degree from georgetown. next call, go ahead. caller: i would like to make a statement and i think i have maybe three questions. host: i will ask you to pick one because we are running out of time. caller: i will just say the question then. i would like to know, who finances you, who you are affiliated with, and -- what i did notice is that guantanamo is not that far from haiti. and one thing i did notice they do is that in the united states they do make them work. why not make them do that in haiti to see if they have rights for other humans that are suffering?

guest: we are in non-profit organization. we get our funds largely from private donors and we do not take any government funds. reintegration programs are really key in solving the problem in guantanamo. -- in guantanamo in closing the facility. i do not know if it would be practical to use the detainees in any relief efforts in haiti. but certainly, pursuing reintegration programs in order to ensure that these days -- these detainees, some of whom have been detained over eight years now, are able to reintegrate into society once they are settled. the reintegration is important risk-management in moving detainee's art of guantanamo and

reducing any possible risks that they have with them. this might include helping them get jobs, maybe some form of modern terrain. -- monitoring. they need to be sure that they are repatriated in a way that really manages any risk. host: thank you so much for joining us. guest: thank you for having me. host: coming up next we will talk about financial literacy, but first, the newest justice on the supreme court, elena kagan, set down and talked with c-span. c-span is releasing parts of our interview with her today. take a look.

>> as of our taping, have you been assigned an opinion? >> i have. i will not be much more specific than this, but every justice gets at least one opinion. the general practice has been followed. >> we've learned so much about the artists persuasion through opinion writing. how are you approaching that? >> i would like my opinions to be as clear as possible. i would like people to pick them up and understand them. i would like to be as bob faw as possible. i would like to write the kind of opinions that will lead to address the competing -- i would like to be as thoughtful as possible. i would like to read the kinds of opinions that will lead to

addressing the complete argument. i'm trying hard to write opinions that i think are thoughtful and complete. and as well reasoned as i can make them. >> can you talk to us about your reclamation process and what the first couple have been like for you? >> it is like tripping down a fire hose. it is always something new and different. there is a lot to learn. the learning curve is extremely steep. sometimes it seems vertical, but people here have been so extraordinarily helpful. all of my colleagues have been wonderful and warm and gracious. and i think that the experiences that i've brought to the job are going to help me a good deal dot, you know, being solicitor general, you get to see the court.

i think i am familiar with practices and procedures of the court. a fair numberith of my colleagues, the way as questions, the things they might be interested in. but it has been a world wind. whirlwind. win >> as solicitor general, you're having to recused herself from a number of cases. how does that work? >> on the cases that i have recused myself from, where there is any discussion that will last anything other than a moment upon i actually get up and walk out and -- then a moment, i have to get up and walk out and they let me know when i can come back.

the person will not be there for the discussion when someone is recused. the worst month was october. i think i can -- by the middle of this year, most of the recusal issues will be gone. there will be an occasional case, even after this year, and in the spring where i will have to recuse myself, but the arc has definitely subsided. >> c-span's entire interview with justice elena kagan. that will air on sunday, december 19, at 6:30 a.m., 9:30 a.m. and 12:30 p.m. we will update the documentary that we did was just as kagan. that will air on sunday at 6:30 p.m. go to our website c-span.org to watch more of this. joining me at the table is john

gannon and he's here to talk about financial capability. he is with the financial industry regulatory authority investor education foundation. how are you measuring us? guest: financial capability is trying to get people beyond their financial literacy, but looking at auction at their financial behavior. we broke it down into a couple of categories, first of all, making ends meet. are people taking steps to make sure they manage their day-to- day finances? then we look at planning ahead. what are they doing to plan ahead, such as an emergency fund, a retirement account, are they planning for their children's college education? are they making choices, decisions around financial products? then we looked at whether they are taking certain steps to basically track their finances? such as, do they check their -- then we look at whether they are

taking certain steps to basically dropped your finances. such as, do they check their credit score? host: when you break it down, how many households spend more on a rainy day fund to cover three months' worth of expenses in an emergency? you found that over half of all americans are living paycheck to paycheck? guest: yeah, that is pretty worrisome that i think that people are living paycheck to paycheck. the other thing that we found is that what we did this study in the summer of 2009, 40% of our respondents had a large drop in income. people are not only living paycheck to paycheck, but some were in very difficult financial straits. host: and you also found that more than half are spending more or equal to their household income. the 60% do not have a rainy day fund. and 24% have use higher cost of

borrowing in the last five years. guest: that is right. this points to a couple of critical issues for americans. they are not saving in general. they are spending more than their income, but they also do not have an emergency fund. we think of as a key component of financial decision making, wise financial decision making. if people have even $200 or $300 saved, when their car breaks down, they can get it repaired and continue to work. but if they do not, they are on to a credit card, or those non- bank arwin anti- debts set -- type of borrowing and that can get into a financial crisis. host: you also broke it down by states. what did you find? where is financial literacy the best and where is it the worst? guest: one of the things that we had in the study is that we

have 28,000 respondents, which allow us to get a sample from every state and the district of columbia. some states did better than others. new york, new hampshire, and new jersey. and some states did a very poor become especially montana, oklahoma and arkansas, as well as some others on the financial capability questions. host: you also found a young americans were more likely to be less financially capable than older americans and young americans more significantly likely to be engaged in on bank borrowing. what should we take away from that? guest: i think young were americans are less financially capable. part of that is that they are young. typically, people's financial knowledge and financial behavior get better with time.

it typically peaks around age 55. but it does concern me, especially that there is such a high rate of no emergency fund. 68% of young people have no emergency fund. host: what can be done on the federal or state level? guest: that is one of the good things about the state-by-state survey is the policy makers can actually look and see whether the policies they already have in place are having an -- an impact. for example, one researcher is looking at data comparing state regulation of non been borrowing, pay loans compared to how people in those states are actually utilizing or not utilizing pay loans. the research can be used to do that. it can also be used to inform you policy a round different types of products and how they are being used and how to

encourage people to save. host: what about education? if your survey shows that young people are not as financially literate as older people, our young people in high school getting what they need to know this stuff? are young people in high school getting what they need to know this stuff? guest: we can tie this to mandates in the state that are tied to school curriculum. but one of the things about many of these mandates is that they are unfounded. there is no teacher training. we need to -- they are unfunded.e there is no teacher training. we need to do more. host: but go to the first caller -- let's go to the first

caller in georgia. caller: the high income tax rate for the very rich, and we need to rescind those. we need to change the channels [unintelligible] we also need to find know why these republicans, these millionaires and billionaires are holding congress hostage. host: let me try to tie that into what we are talking about because i did see a story today about the tax cut deal if you are living in new york saying that this will put more money in the pockets of americans, but at the same time they are seeing their health-care premiums go upon. it appeared -- and go up. they're seeing their payments

for their cars go up. when you look at the issue and having a rainy day fund, how in these economic times when the cost of living seems to be going up for people, how is it that you could possibly save for three months? how realistic is that? guest: obviously, it depends on your income. for people who are making minimum wage, that can be very difficult. but i would urge people -- you know, three months may be beyond many people, but even having a couple hundred dollars in savings can keep you from increasing your credit card debt and increasing on bank borrowing. those are things that are high interest types of loans -- and increasing on bank borrowing. those are things that are high interest of loans. we have to change the philosophy. we just did focus group testing with kids. we asked them, what is an emergency fund? their answer, credit cards.

that is not what we want to be teaching our kids. host: there is a story in the "new york times" this morning, lenders taking on more risk. guest: only about one-third of americans in our survey shopped around for credit cards. it is so simple today to go on line and look at virtually hundreds of credit cards, you know, which once had the lowest interest, which ones may have payment terms that are in your interest and not the banks. other options that you may want to consider. those are the things that people need to do, shop around for the best product for them. if host: what is the reason they gave you for why they do not shop around? guest: do not know the answer to that.

many people are just uncomfortable with finances and they do not necessarily know where to turn. but the information is out there. people need to take just a half an hour of their time in some instances and shop around to find what are the best financial products for them. across the board, some financial products have hi-fi's that will hurt you and some ... -- have high fees that will hurt you and some do not. host: richard, you are on the air. go ahead. caller: how does the -- how your findings relate to pensions? and in a consumer economy, why would you be saving? what is the average income level

of the people that you cold? and was the average world of the people that you tolpolled? guest: that is a very good question about pensions because what we have seen in the last decade is employers going away from contribution programs or for one case where the individual, rather than the employer is responsible for making the decision around their retirement savings. our survey tells us that people are not necessarily making good decisions with respect to their retirement savings. not everybody has figured out how much they need to save for retirement. that is a key component. also, a lot of people do not understand the difference between owning a stock nurses a stock mutual fund and what diversification -- reverses a stock mutual fund and what diversification can do. those are some issues that are

very important for people to get. host: next call is from illinois. mckee on the republican line. caller: i understand that taxes are going to be increased for the upper level income businesses, etc. and i was wondering if there have been any studies to find out if they are actually using this money to actually have any jobs, you know, starting in the new jobs with that money that they're having to pay taxes on. and in general, i just wanted to find out pretty much that, if that is what they are actually doing with the tax benefit that they are receiving. host: i do not think our guest can answer that bet -- the question specifically. we're talking about in a report that his group did about financial literacy. do you have a question about that?

caller: i do have a statement about that. i went to high school and i'm also a college graduate. i did have an economics class in high school that did help quite a bit. my husband and i, we are finding -- we were financially doing fine and unfortunately he passed away a year-and-a-half ago. but i do have two sons the graduated from college and they also took those kinds of causes as well. but if you do not have jobs to save the money, it makes it hard for them as well. i know they do have a little bit of savings. another example is, my one son, he had -- he wanted to get a home, but the rent is $600, i believe, per month. he wanted to get a home and, of course, he figured a dog.

he figured of how much he could buy -- he figured it out. he figured out how much he could buy and etc. when he went back to it, he found out that he pays $600 -- well, he knew it, too. host: we're going to have to leave it there and move on. i do want to remind other viewers that the tax-cut deal is going to come up in debate in the senate today on c-span2. that is the first test vote on whether or not it can pass the senate. we were reading appears this morning that it should pass with relative ease. guest: to raise some good points about college and college education. one of our service -- one of the things our survey did show is that only about one-third of the sabres were planning on the

saving for their child's college education and only about one- third of those were using good methods for doing so. people need to think about choosing the right method for college. you can save for college or you can borrow for college. the average amount of student debt is $24,000. that is a lot of money for a child to get into this economy and have to pay off. host: the regulatory authority investor a vacation foundation recently put out a study. fairfax, va., you are next. caller: i'm really glad you are talking about this today. i have a couple of comments and then a question. at first the question. how can we get the cost of

living down far enough? the rent here is ridiculously high. the wages do not cover it. people educated in how to handle finances are forced pretty much to go on credit cards. that drives them further into debt. how do you see your financial literacy report helping people deal with that situation? i will take my answer and i appreciate you being in here today. guest: living there myself, i know that it is a high-cost place to live. there are a number of things people need to do to manage their credit-card debt. i do think that many people can actually save some money. there are different ways that we can all cut our costs if we look at it. unfortunately, today we take a lot of things as expected expenses that maybe for the

short time are not absolutely necessary. we all need to look at how we can cut our expenses. and do a better job of that. host: on your web site do you have tools to help people with their financial literacy? guest: yes, we do. trudy website we have a number of resources that we have created and a number that other organizations have provided to us. for example, we have a great partnership with the library association and reporting education materials in libraries are run the country. we're doing the same thing with the united way to get into communities through nonprofits. those are the ways to reach people. there's a lot of good material out there. unfortunately, it just does not

reach people. that is one thing we are trying to do at the foundation is get over that hurdle. host: on the website, you can find an interactive link where you can play around with this state-by-state study that the group put out. also on the web, you can see the producers are playing with it. also on the website is a financial jaques, if you want to quiz yourself on your own financial literacy -- there is a financial quiz. if you want to quiz yourself on your own financial literacy. next call is from ellyn. are you with us? we will move on to florida, john, go ahead. caller: i am retired military and i also have a degree. my parents taught me a very early age to balance my checkbook and not by anything i really do not need. as i get a little bit older, now

receiving social security, and of course, the past two years we have not gotten a cost-of-living increase. our senators vote themselves a raise, but we have to bite the bullet. is there anything i can do to try to help myself? i do not spend money that i do not have to spend. guest: one of the things with respect to social security, you can obviously write your senators and congressmen to get a cost-of-living adjustment to social security. the good thing is that we are in a low inflation environment today and part of the reason is because there has not been a cost-of-living adjustment. but different expenses can go up even though the overall inflation rate is very low. things that you can do -- look at your monthly expenses and figure airport what you can do to cut those expenses. you said you were formerly in the military.

we have a very large military financial education program. we have a site, saveandinvest .org. and on financial literacy they did much better than the population at large because of the one area, and that was credit card debt. a huge amount of credit card debt among the military. over 27% of the military response we had were over $10 in credit-card debt, which is a lot. -- $10,000 in credit-card debt, which is a lot. host: here is a tweet. guest: if you get retirement savings, that this tax advantage in a number of ways. if you contribute to a 401k, your interest compounds over time and that is not taxed until you take the money out.

if you buy a home, your interest rate is deducted. that is another way of saving. pure savings is not a tax advantage in any way, but there are ways to save for college, to save for retirement and you do get a tax advantages and i think the government is trying to encourage saving in those areas. host: here is another comment from illinois. guest: that is a hope. right now we have four states that mandate a personal finance course. and we have another 20 states that mandates some kind of personal finance during the secondary school years. i would hope that we see more states mandating in some way, some financial education for our school children. i think that it is also very important that parents talk to their sons and daughters about money.

unfortunately, it is a difficult situation, but i think teaching people good savings and investing habits is critical to making sure that children graduate from school with a good understanding and a good financial sense. host: the next phone call comes from midland, n.c., and john cullen democratic line. -- john, democratic line. caller: thank you for taking my call. you said he did not know the answer to why people are so little -- delivered about finances. the problems seem to be in our schools -- so illiterate about finances. the problems seem to be in our schools. i was never taught about what was about to happen to me when i entered the work force as a young man. fortunately for me, i did make up quite well. host: we will leave it there, john. guest: that is a good point. for many years, financial and

education has not been taught in schools. i think we are starting to see a reversal of that with many states now mandating some form of personal finance in schools, which i think is important. i do think improvements need to be made there, especially making sure that teachers are trained and able to teach the subject. and i think organizations need to focus on that. host: texas, don, independent line, your next. caller: a pretty good discussion, but everything legislative literacy might help a bit more. the dollar are spending -- because you are spending this merry go round so fast-spinning this merry-go-round's so fast when it is actually the financial industry that drive our congressmen and senators in order to do regulate the

industry. host: all right. that is down in texas. andy, republican line in new york. caller: i was a democrat and now a republican. the problem is, -- i think midwest. he said, in school -- i'm 38 years old, by the way. i do not remind -- remember being taught anything financial in school. now that is the biggest thing. we're losing jobs overseas. it is a scary time in america. how can i put it? i cannot be a democrat. we have too much government. i have been out of work purina i was a subcontractor -- i have

been out of work. i was a subcontractor. i have been out of work for two and a half years. i have lowered my standard. at one time i was earning $23 an hour. they do not even want to give me a job for $10 an hour. and the lord my rate. it is scary. ordaz -- by lord my rate. it's scary. the best -- i lowered my rage. it is scary. host: i'm not sure he had a question. guest: at age 38, is likely that you did not receive financial education in schools. but things are changing and i hope that more people are writing from high school with some knowledge of these issues. it is critically important, especially today. we are so much more responsible

for making the financial decisions we have to make when it comes to retirement savings. that is now on us. products are more complicated. we have a lot of financial choices we have to make and we have to educate ourselves about them so we made good financial decisions. if we do spend the time to do that, we can be in a better place. for most people, learning these lessons is critically important. host: another comment from our twitter audience -- in your survey, how did you get at how americans view money? guest: we did not serve as a

degree of the question. we did ask a lot of questions about how they were spending more saving their money and we found that many people are not saving in general for retirement. they do not have an emergency fund. people have been spending more than they should. i think what we have seen since the financial crisis when our survey was feeling, the savings rate has gone up, which is a good sign. hopefully, when we read to the survey, we will see a -- when we do the survey again, we will see an increase in saving. i think the financial crisis was not only with a call for congress and policy makers, but individuals as well. i do think a lot of people refocus on their own death -- financial decision making. host: gilbert, thank you for waiting. caller: isn't this kind of

misplaced, your function there? instead of financial education for the american people, shouldn't we have it for the american -- for the government officials who spend more money? guest: that is a difficult question to answer, but i think we all need to spend less than we make. i think that is critically important for this country host: -- for this country. host: are you still there? caller: yes, but i think we are dealing with a symptom rather than the route cause. because is that we keep shooting our jobs overseas. our government keeps putting us in this position. i suspect this is more by design than anything else and people are just trying to survive the best they can. i do not believe it is a matter of education of the american people. i think the problem squarely on every senator, every

congressman and every president that we have ever had. host: another comment from a viewer. guest: that is one of the questions that we announced in part of our battery of questions, did people understand inflation? a fairly large percentage did not understand the impact of inflation on savings. we do have very low interest rates today, which is very challenging for most americans where to put their money where it can earn a rate of interest above inflation, especially for people who are entering retirement. they cannot necessarily rely on bank deposits or cds to keep up with inflation. but there are other options available, bonds have a higher

interest rates, and some forms of stocks. i think there are different ways to try to talk about. but again, it argues for the importance of financial education, and making sure that we are shopping around for good at financial products. host: what is the least understood financial issue by americans? guest: from a knowledge standpoint, one of the questions the people -- that people did the worst on and only got 28% right, we asked a question about the impact of interest-rate on bonds, which is a very common investment especially for older americans. when interest rates go up, bond prices go down, which is a very important thing to understand today because as we are in a very low interest rate environment, and interest rates are only headed probably one way, which is up. we do not know when, but at some point they will. to not understand that bond prices will fall when that happens could put a lot of

people in a difficult situation if they have bonds in their portfolio. host: the most understood? guest: people have a fairly good understanding of compound interest. if we askeunfortunately, there t of information out there where you have high interest rates over a long time friend and people get very confused about compound interest and tend to underestimate the benefits of saving more, ginger's they will have to pay on that. host: new jersey, your on the air. -- you are on the air. caller: this conversation is so laughable.

there is nothing wrong with the financial literacy of the american people. but you just dismiss the previous caller, who i think god it really right. it is not the american people that need education. it is a public and private sector politician -- is the public and private sector politicians that have gone completely sociopathic. it is not about money. it is about having a conscience and some level of ethics. we are always talking about money, but the heart of the problem is that we are being controlled now by very reckless tax collectors and very un scrupulous money lenders. host: louisville, kentucky, republican line.

caller: my question might be slightly off the train of thought that has been going on, but my question is about in defined savings plans previously, such as with companies like enron -- i'm wondering if in the defined contribution plans there are any legislative or regulatory protections. guest: the difference between a defined benefit and defined contribution plan, which respect to the contribution plan or 401k, the money in the plan is your own. once it is in there, unless the company is committing fraud on the plan, you can get that money because it is your own. you have your own account. which is much different than a pension, where an employer is

basically collecting and investing money for you in a pooled fund. when a company goes bankrupt you may lose all or some of that money. host: next crop -- next phone call comes from minnesota. are you in minnesota, montana? caller: montana. is there a correlation between the average income and the literacy? guest: that is a good question, and actually, in looking at the data there are a couple of demographic factors that impact your financial capability. one we already discussed his age. typically, people who are younger do less well on financial capability questions on our survey.

the of the demographic factor that influences financial education -- financial capability is education. income does play point also. to become a higher income, more financially capable. -- typically, higher income, more financially capable. that may be because individuals with a higher income have seen more types of financial products because they can access them. they are more likely to have a mortgage. they're more likely to invest than people with lower income tops. host: next -- lower incomes. host: next phone call from florida. caller: i am financially. , but i have a question about the reagan years. -- i am financially ignoring to, but i have a question about the reagan years.

a lot of people get credit cards, they miss a payment, their interests can dog to 18%, 24%, 26%. is it the financial industry in the united states just a bunch of loan sharks now? guest: i think the creation of the consumer financial products bureau is trying to do a lot to be sure that people get fair information about credit cards and other types of financial products like that. obviously, it is not up and running layet and we will see hw it does in managing those issues. host: robert, republican line. caller: good morning. when i was 5 years old -- and i'm 72 now. i was selling packages of soap

and down the street during the war and i was making money. i got a savings account. i save my money. i bought a war bond. i worked for people. you know, minimally, doing this, doing that, picking up bottles, gunnysacks. everything i've bought and sold. horses, cows, everything. today, these young kids, you cannot work or you are going to lose the best part of your life. kids want to work. they want to make money. this is the best way to teach them how to take care of their money. this country is absolutely stupid. the main problem -- my mother, unfortunately, told me, so your sheep. we do not have time for them. -- sell your sheep. we do not have time for them. those sheep would have put me

through college. young people want to work. i listen to you all the time. your the best. guest: work teaches young people the value of money, probably more than anything else. it is difficult today, at least compared to when i was growing up, to get jobs. when i was growing up, there was a paper route. there were many options for kids. i think kids should look for jobs and i think parents should encourage them to get a job because it is the way to learn the value of money, especially given the high cost of college education today. host: john gannon, thank you very much for talking to our viewers. guest: thank you very much. host: couple of things i want to let you know before we say goodbye this morning. we told you that the rnc chair michael steele will let members know this evening in a conference call off whether or not he will run for a second term.

politico is reporting that norm kohlman may enter the parenti race. -- be our nc race. -- the rnc rac,. he is likely to enter the race now that chairman michael steele is not likely to re-enter the race. also, the senate will take a key vote at 3:00 p.m. eastern time on this deal negotiated by president obama with republicans on tax cuts. we are told in papers this morning that it should pass with relative ease. 3:00 p.m. eastern time, live coverage on c-span2. speake