[captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> we are submitting our report today, on time, under budget, with unanimous vote of the seven members of the commission. >> we began our efforts with the trip to the of gulf. we thought it was important to hear the voices most affected by this tragedy. i would like to recognize the distinguished service in extraordinary work of the commission's staff led by mr. richard lazarus and fred bartlett as the head of the investigative team. the staff, which was composed of scientists, lawyers, and more, performed under a very tight schedules and a great public service for which we as the commission are extremely proud. i would like to give a brief

overview of our report and some of its findings, and then i will turn the podium over to my colleague and code-share, mr. bill reilly, who will address the implications for the industry practices in the future of offshore drilling. there is a fundamental fact that the oil and gas off of our shores is an american asset. it belongs to the people of the united states of america, and thus the federal government has a dual role, it is a regulator for things such as safety into environmental protection, but it is also the land owner in a very real sense we own this property and have an obligation to respond when the public trust is abused. a fundamental finding of our six months of investigation is the deep water rise in disaster did

not have to happen. -- deepwater horizon disaster did not have to happen. that makes the enormous damage and the loss of lives even more tragic. for the past 20 years, there has been a rapid movement by the oil and gas industry to deeper and deeper, riskier and riskier areas of the gulf of mexico. this movement has generated a pundit revenues for the private companies and for the federal treasury. industry has been justifiably proud of technological advances, which have been frequently compared in sophistication to those of the space program. the federal government has benefited by the increase in revenues. what happened during that 20 year period is that we became

pulled into a sense of inevitable success, an illusion which massed the dramatic success in risk that accompanied the deepwater spill. on april 20, after a long time are rolling the dice, our luck ran out. our investigation found significant errors by three drilling companies, pp, halliburton -- bp, halliburton and transocean. these are described in detail in the chief counsel report. they range from bill years to properly interpret warnings -- failures to interpret warnings,

flaws of not being properly understood, and late stage design decisions. taken together, we conclude that these mistakes amounted to a significant failure of management. it is important to emphasize these errors, mistakes and management failures were not the product of a single rope company. we believe and unveiled a systemic failure within the oil and gas industry and with than the regulation by the federal government of that industry. how did such a situation come to pass? how can it be that such questionable practices could take place when the stakes were so high? i am sad to say that part of the answer is the fact that our government let it happen, our regulators were consistently

unmatched. the department of interior lack the expertise to successfully in force regulations. there was also an internal conflict of interest within the department of interiors old minerals management service. it was a service that have the responsibility for collecting revenues, the second-largest source of revenues into the federal government, second only to the income tax, and it had the responsibility of providing an effective management of safety and protection of the environment. those two conflicting responsibilities, as we heard from three former directors of mms consistently led to revenue trumping safety as a priority of the department'. we recommend, therefore, that

congress and the of ministration created independent safety administration within the department of interior with the ability to oversee all aspects of offshore drilling safety. we believe this agency should be headed by an individual with a background in both science and management who should serve a thick term in order to be inundated by a the ability to make decisions. we also recommend bringing our offshore drilling regulations into the 21st century. it is not asking too much that our perch in the united states be equivalent of the best practices and the world. they are not that today, and sadly the united states has one of the lesser records in terms of the safety of its offshore

drilling practices. the second piece of this modernization approach is called risc-based regulatory orientation. this requires all offshore drilling companies to demonstrate that they have thoroughly evaluated all the risks associated with drilling a particular well. macondothe realities of a cond is that it turned out to be a unusually risky area to drill, high pressures, many unknowns about the geology, and yet a company with one of the worst safety records received the least in there for the entitlement for access to that area. april 20 was the consequence of the convergence of those unfortunate facts.

our investigation is also demonstrating that science is not being given a significant seat at the table. actually i think that is a considerable understatement. it has been virtually shut out. we need proper consultation with those who have the expertise, scientists in and out of government, experts at agencies like nola and the coast guard -- these are the people that should play a major role in evaluating specific permit requests and operation of drilling rigs. it is disturbing to learn that the march 2010 decision to expand areas to additional drilling in the at the intake and eastern gulf -- in the atlantic and eastern gulf were

made without looking at the potential consequences. i will conclude my remarks by making a simple and obvious point that is often forgotten when we talk about offshore drilling, and that is again that these properties belong to all of us. they belong to the people of the united states of america. it is our government's responsibility to ensure that exploration and extraction incur in ways that are beneficial to the ccountry. drilling offshore is a privilege to be learned not a right to be exercise by private corporations. our recommendations offer a path to that destination.

much has changed in the months since the blowout. we have learned a great deal about how to contain spills at deepwater. industry has a new appreciation of the risks associated with deepwater drilling. the commission of plots all of these efforts -- applauds all of these efforts, but they are not enough. drilling offshore is inherently risky and we will never reduce the risk to 0, but as a nation we can take concrete steps that will mitigate the chances of another blowout and reduce the consequences should another even such as that occur. the commission believes that these steps are vitally necessary. without such response we will continue to play safety for workers, the apartment and the

region at an acceptable risk. if dramatic steps are not take and i am afraid that at some point another failure will occur and we will wonder why did the congress, why did the industry, why did the american people allow this to occur again. the people of the gulf have suffered so much that they deserve to know that their government and the industry are going to and are committed to the high standards of safety and protection of the environment. thank you. >> mr. reilly. >> thank you, bob. i want to first recognize that one of our distinguished members is ill today and very unfortunately could not be with us. she understood in ways that none

of us the rest of us probably here to the specific technologies and engineering realities that helped us explain what happened on april 20. i want to also emphasize, as bob just did, that this report is unanimous, came in under budget , and also on time. i understand that is the first time in the history of commissions that anybody has not asked for wartime. i was told by one member of congress that this is something we should advertise and take credit for and another one that said we set a terrible precedent for washington. i am very proud of the commissioners i served with. none more than my longtime friend, statesman, and co-chair, bob gramm. this has been an enormously satisfying enterprise. the report has the quality it has and did get completed on time is a tribute to a marvelous

interdisciplinary staff, as great as i have ever worked with recruited by prof. richard lazarus. senator gramm has characterized what happened on april 20. he has explained a proximate cause, the bad decisions, the blunders, the inexplicable -- inexplainable choices and the root cause as the president and his executive order directed us to do. the culture of complacency, government and the industry. i think the reality is that none of us were prepared for this. obviously government and certainly should have been. the early response to this spill is evidence, and this commission is critical, even harsh about

some of the faults in the early efforts to get a grip on the problem, identify the flow rate, to contain the following well. having said that, having visited the gulf, i have to say there is very impressive about the response of this. tens of thousands of people work day and night to try to clean it up. they may have incurred cost of time and energy into even health, but they did the job. after a slow start our government responded quite effectively to this spill. even in the case of finally determining the flow rate with ingenuity. make no mistake about it, despite allegations, this was not obama's katrina. however, we have identified gaps that lead us to recommend

important recommendations to the congress, administration come into industry. to congress we say, it is time to exercise serious oversight over the department of the interior and the bureau of oceans management that has succeeded mms. oversight that has not been characterized by a previous congressional responses and attention to that agency. we recommend as a first priority the resources be allocated by the congress to ensure that this agency is capable, is a match for the people they are inspecting and regulating every day. they have not been. they have been overmatched. they have been under resource, underfunded, and undertrained. they're going to have to get

resources from the congress. they will have to have a compensation system that allows more recruitment of able people, who unlike so many to reveal to us in the course of the investigation, did not understand key technologies like centralizes and-t negative touch sensors. we did a lot of questions about whether congress will pay a lot of attention to west. one congressman was paying a lot of attention yesterday when i briefed him based on the verbatim speech that later came from him. we can take some encouragement from that i think. the fact that the building operation at interior, now under way in quite effectively so, is going to take time points to an

important reason why industry, which cannot wait, needs to pick up its own game. one thing is the chemical industry. when the nuclear industry after a three-mile island established the institute for nuclear power operations. there are other examples. the oil and gas industry, which may not have been a high risk industry when it is in shallow waters, have you so after this incident here yen we have identified and documented as systemic problem in this industry. that observes -- that deserves

observation. i am aware and heard from ceos of companies who dislike, who are revolted by the idea of being painted with the same brush, companies that had exemplary records for safety and environmental protection. i fully understand that. we do not say those companies have been remiss. what we say is that the likelihood of those that drill are at risk because of this result. in order to believe this is not a systemic problem, one has to believe that halliburton would only has supplied faulty cement to bp. irrespective of whether industry

except our analysis that this is a systemic problem, but halliburton and transmission are operating in all of the world's ocean for all of the oil and gas industry, even if you do not accept that, it seems to be indisputable that the solution of the problem must be industrywide. industry has to stop thinking that it is sufficient to have a state of the art best practice safety and management system and that is the end of the story. several companies, quite outstanding companies, presented their safety and management systems to the staff, meetings at which i was present. chevron, exxon mobil, shell. at the conclusion of the meeting i do not think it occurred to any of us to ask what are they doing, what should be done now? nevertheless, i asked the question how did you manage the risk that your rigs might all be

shut down in the gulf? to that they have no question. going forward they need such a question. therefore assayed the institute, which is entirely manned by industry, which enforces best practice, which evaluates, audits the performance of various companies is what we recommend. i strongly encourage the most exemplary practitioners of good safety, the internment of protection, to leave the rest of the industry, which i know is a complicated industry and more complicated one than the nuclear industry. it is also technologically capable of well-financed industry to follow that course. i guess one of the real tragedies but also the opportunities presented by this experience, and a tragedy like this does openness to be open to new directions, is the poor of the gulf of mexico.

we have long known that the resources are a profound resource. louisiana has something like 30 percent of all of the country's wetlands. there silently eroding away. they are disappearing because of sea level rise, but also dredging, and generations of oil and gas activity. for a long time we have known what needs to be done there. there are many projects, many that are authorized, that are standing by for support. for the first time in my career as a conservationist, we have the prospect of serious money to do what needs to be done. if the fines and penalties that are to be assessed under the clean water act are deployed, 80% at least, to the restoration, the country owes

that to the gulf and a very much hope congress will agree to appropriate the funds and direct them to the gulf. finally, the problems that we confront in energy in the oil and gas industry are like so many environmental problems, we cannot solve them alone at the country even. the gulf of mexico is shared to a very large degree with mexico. cuba has also expressed interest in possibly drilling 14 wells, some of them 50 miles off the coast of florida. i have already opened conversation with the mexicans, as has secretary salazar about their need to enter an agreement with the united states. one hopes to but can be drawn into this conversation as well so that all of us practice the same level. -- one hopes cuba can be drawn

into this conversation as well so that all of this practice the same level. the same with arctic. it is a punishing environment. it is beset by whether the like of which one does not see in the gulf, except maybe in the occasion ever hurricane. it will acquire special care and attention and the kind of regulations that are effective in the gulf will not be acceptable in the arctic. russia, canada, norway, denmark has already begun last summer to drill two wells, -- all will want to develop those resources and so will the united states. we recommend the state department engage those countries and a common standard -- in a common standard going forward. those are some of the highlights of our recommendations. they are by no means all of

them. we believe if these recommendations are followed and that if the course we have set out is taken, we will go a long way toward restoring the faith of the country in a vital enterprise. thank you. >> questions? >> as you pointed out, mr. reilly, the oil and gas industry, when it operated in shallow waters was not the ticket rate a high-risk industry. some in the energy industry have complained that the reason they are drilling of 5,000 feet is the government has barred drilling in shallow waters. with the commission recommend or did you discuss the possibility of getting the shallow waters open so they do not have to go

into deeper waters? >> we understand fully that the notices to lease is five and six are recurring some attention and the certification of equipment. there are necessarily some adjustments that will take time before full resumption of drilling ochres and shallow waters, as well as inhe dee waters. senator gramm and i have been critical of the moratorium, which we thought was excessive and last a toed too long. that aside, the real reason we are in deep water is because that is where the oil is. if you look at debt reserves that are estimated to exist, they're not only in the deep water, they are in the deeper and deeper water. we are where now plans to go down 10,000 feet. to the extent that oil and gas is in deep water, that is where the industry will go. not just here but in brazil and other parts of the world as

well. alaska is shallow water. 140 feet or so. that presents its own set of problems. fundamentally this is a hopeful message. we believe this is a problem that can be managed, and in the interest of everyone to manage it. >> sir? >> matt clover with cns news. you said this was an interesting wide problem. do you have any evidence that you could share with us that the same mistakes are being made right now? are they being made in u.s. waters and where are they being made? >> the commission did that document these problems and other places. we are perfectly aware of blowout preventers that did not work in other environments. i would cite just once a cystic -- a statistic. the fatality rate for 100

million hours worked in the united states is five in united states water in the gulf. in the north sea and in europe it is one. that needs an explanation and points for problem. i think it points to a system- wide problem. sir? >> as early as last week jack girard, the president of the american petroleum institute said that he felt the american people believed macondo was an isolated incident. as you know, there is significant resistance on the part of industry to create the safety institute europe called for. on the government side, congress last year tried to pass an oil spill legislation that contained a lot of the things you a call for. that legislation went nowhere.

what are you when to do to make sure your report, as the row as it is come is not ignored by congress and industry? >> well, we're want to make a lot of noise. we're testifying on the 26 and january in the morning. -- 26 of january in the morning. we suggest there will be more attention to the kind of thing we have suggested, a more detailed research. we do not say really what we do not know here. we know this is a systemic problem given the pervasiveness of the contractors, the right manager, owner, the largest in the world, halliburton, which is operating virtually everywhere servicing the oil and gas industry. the only thing i would say is i do not think one should assume that industry will not support a safety institute based upon the

private conversations i have had, they are seriously deliberating on the possibility. i have every hope and expectation that they will in fact establish one. >> all the way over here. john beckman with energy daily. a week or so ago the interior recently relaxed and are meant to reduce for a number of of offshore crude water drillers that had already had their operations permitted prior to the drill. what was your response to that? >> immediately after the all of the companies i am aware of step down. investigated, inspected each of the companies, certainly the 33 that were shut down. the exploratory rigs down seven

or nine violations. i think one can have confidence decisionssecretary's are defense will and wont to go ahead on those rigs. >> one of the underlying themes of our report is particularity. we are recommending that drilling on specific sites be evaluated in terms of riskiness. it was our feeling that rather than throw a blanket over 33 that were affected by the moratorium that it should be a evaluated on the company by company, rig by rig. when a company and its mechanics were shown to be in compliance with the higher standards that have now been established, they should not be held back because

there were others that had failed to comply with the new standards, and i believe that is the essentially -- that is essentially the policy the administration has concurred with. >> hi. i am with the "fiscal times." you have talked about funding and compensation. can you tell me where the funding is coming from and where, if you have a time when or specifics on how quickly you want this established? >> one of the areas where i think the funding should come from is the lease itself. what is special about offshore drilling as compared to on shore, where much of the drilling takes place on privately owned land, all of the land in the gulf of mexico is

public land that belongs to the people of the united states or to the people that belong to the five gulf states. we believe it is appropriate that in the decision to allow a company to have access to the publicly and, there should also be a provision requiring the company to pay a fee significant to cover the regulation as it executes that lease. this is not a new concept. in fact, but offshore industry is almost an allied air. regulatedmajor reg industry pay for the regulation through some sort of sfee. we think that should be the case with the oil and gas industry, and believed the lease is one of

the means of doing so. in doing so in a way that would ensure a sustained it, predictable source of funds for regulation so that the kinds of competencies can be met. >> over here. we have one. >> "washington post." can you talk about how the lack of subpoena power may have affected the ability to look into accountability high up as some of these companies? >> terry garcia. we were able to through the very able efforts of archie cancel to chief cancel able to ascertain the answers to the questions the president asked.

that does not mean there were people we did not interview, but we were able to obtain the information that was necessary for us to do our work. i want to follow up on something that the senator and bill had said about the question of whether this was an industry- wide issue. what was not in doubt and what is not disputed is that the industry was not prepared for this. what is not in doubt is that industrywide research and development efforts had not been undertaken to address this sort of event. what was very clear was there was an utter lack of ability when this occurred for the industry to effectively respond and then to contain this event. it was industrywide in that sense.

>> sir. >> gentleman, one of your recommendations deals with the liability of offshore oil spills saying that 75 million is totally inadequate. to you have a range in mind? why did you not say lift the cap all together as some in congress have proposed? >> we looked at the question of liability and the recommendation is that the cap be lifted. we did not recommend that it be lifted to and unlimited liability. we could not reach an agreement on that. we did identify the ad to be lifted in the per incident. this is also the recommendation that the of magician has made, and it is really of to congress to address this. it is really one of the things that does require congressional action. just to put a point on one of the earlier questions, there are

many recommendations in this report that can be enacted by the administration. the agencies to have authority. as we call on congress to act and called on industry to act as well, there are actions that can be taken by the federal government using agency authority to strengthen oversight and regulation and we're calling on the administration to do that as well. >> thank you. libby casey with the alaska public radio. i was wondering if you could elaborate more about arctic. should there be a moratorium until oil spills in icy water can be cleaned up with proven technology? >> the commission is not asking for a moratorium in alaska. recognizing that there are very important questions still ahead for us to be answered through additional research and investment in the arctic

specific technology. we feel that research that has a specific time when it and focus research that will help answer questions for the private sector and public sector is really what is required. another very important recommendation of the commission as it relates to arctic development is we are asking congress to fund the coast guard so that they are adequately prepared for god forbid an oil spill, but also search and rescue. as ice retreats and we see more and more traffic in the arctic, it is essential but the coast guard, and for that matter, the navy, at the essence necessary to be able to respond in the arctic. for us to be able to move forward with oil and gas development and in the other development, we need to be prepared as a nation. a number of studies have indicated that the coast guard does not have adequate

capabilities to be able to respond appropriately and arctic. there are a number of things, additional research in terms of the environment, the international protocols that bill mentioned earlier with other arctic nations, additional investment in the coast guard, and i would add something we have not talked a whole lot about of this point, empowering local people to be part of the decision making process. after the exxon valdez oil spill regional citizens' advisory committees were created in alaska. our commission recommends doing something very similar in the gulf of mexico to empower the people to be active participants in the planning of oil and gas development, in reacting to proposals, reviewing a oil spill response plans, in training so that if there is this bill they are able to be part of the work force and a better prepared way. we recommend the same thing for the arctic. we think all of these things

will better position the united states to be able to take advantage of the resources of the arctic, but we do not feel as though we should sit back and wait indefinitely for that to happen. we're challenging congress to put funding into both the research and the capabilities for the coast guard and other agencies so that we can move forward. >> yes, sir. >> randy showstack. i would appreciate if you could explain or elaborate on why science has not had a significant lead at the table and way made -- what may be the relationship between that and the initial difficulties in determining oil flow rates and other problems. >> the lack of understanding of basic environmental processes in the gulf of mexico was striking as a result of this incident. for example, there were lots of

confusion about whether there were submerged deepwater plumes of oil. there was a lack of understanding of where those plumes were going and what the effects may be. the science can answer these questions. some of the first results of science that have been conducted on this have been very revealing a very -- a number of very important publications. it should be done in advance so that we understand operating environment in a comprehensive way. in the past investments in science related to support the offshore development program have been oriented towards completing the minimum, identify potentially sensitive environments for development of environmental impact statements, rather than comprehensively and distending the effect of oil and gas that might be released into

the system. our recommendations are still up the scientific research community, elevate it so that it can bring the fruits of the research to bear on the environmental assessments to support the leasing decisions. and as part of that process to involve other very important powerful science agencies, both to bring theusgs best science to bear on this environmental decision making. the second area where science will be very important is, as mr. wright the indicated, we recommend doing substantial investments of the penalties of the clean water act violations to go to the environmental restoration. these restoration assessments can only be effective if they are guided by the best science

to directed to the priorities of restoring brazilians to the system and making sure that we're using the best methods to assess the outcome. in both of those areas in terms of the assessment of the risk going forward, with respect to oil and gas development, as well as the investments in restoration we think a solid scientific program is essential. >> down here. >> russell from "corporate crime reporter." nowhere in your report to question whether a crime was committed. i am wondering if you believe there should be increased

resources to criminals and in our mental enforcement to help detour -- deter this type of behavior? >> when we first met with the president and he gave us the assignment, there was an understanding that our purpose was to develop the factual record upon which this event occurred, that it would be for others, specifically the department of justice, to determine if those facts constituted a criminal act, and if so, for what specific purpose? we did not undertake the issue of attempting to determine criminal liability. i will leave it to the readers of the reports of of whether they believe they can find it in our factual program. nor did we look specifically at the question of the resources necessary to reach a judgment as to whether a crime had been

committed. >> all the way back there. >> amy harder with "national journal." you said you did not recommend unlimited liability. i understand that oil spill liability trust fund already does that. two questions. why did you not recommend an unlimited liability removing the cap entirely, and you did -- did you consider the concept where companies producing in the gulf would pay into that? >> we do recommend a significant increase in liability. we frankly are sensitive to what we do not know. we know that canada has a much lower liability maximum. $35 million. the united kingdom that has one that is not much more.

we do not really know how the insurance company would address issues of liability were we to propose some kind of straightforward insurance pool. we have a lot of sympathy for the fact that there are 185 independent operators in the gulf. the truth is we did not have time to get in to conversation with the insurance industry. we assume, though we do not know, that some kind of insurance pool can deal with the special problems of the independence. we have been clear in meetings with them that on one hand we respect what they do, have a concern to ensure that they continue to be operating competitive for all the economic and cultural reasons that they represent, but it is also unreasonable to expect they can inflict billions of dollars of damages that that bill will not be sent to the public. some kind of compromise has to

be worked out on that, and our position on this one is close to the administration in that we recommend a significant increase in the liability cap, without specifying exactly what it should be. >> if i can supplement what bill has said, the question that there should be a single member that covers all instances, if there is one thing we have learned is that there is a dramatic difference in the risks and consequences of that risk the deeper and deeper you drill into more dangerous high you're pressured or geologically challenging areas. -- or higher pressured or geologically challenging areas.

it could be dramatically different for well-known as shallow waters, as opposed to the unknown of the old toward deep into which we are about to commence operations. that at raises the issue ba the state the case as a new mode of regulation, i do not expect that will become familiar very rapidly in this country where it has not been the practice before, though a couple of companies to already use it in the gulf and is required to use in the north sea. what that says is on the foundation of prescriptive regulations come each company goes beyond that to assess those dangers and threats that are inherent in a specific well information or rig design situation. the advantage of that is a put a lot of initiative on the industry to focus specifically, not just to get the box is checked for compliance, specifically on a given place

with its given challenges. one thing we hope it will do is avoid the prescriptions, which may be perfectly applicable today and the year after that, but the given -- but given the rate that this industry progress is, become obsolete in three to five years. the state the case would guard against that. we're recommending the interior department promote the in the industry can operate and do that in our own waters as well. >> what are the top priorities for congress that you will be recommended when you testify? >> i think the top priority is to first of all give resources to the interior department to enable it to provide oversight job that has. secondly, to ensure that the majority of the clean water act

penalties go to the gulf restoration, which i think is a top priority of ours. third, to lift the liability cap and really address that issue so that any future spill that happens in u.s. waters the public is protected. >> one question -- >> you are? >> [inaudible] one of the proposals was calling for more time to assess the applications. there is argument of about whether they can do that with existing authority or whether they can extend the 30 day window they currently operate under. i am wondering if there has been a determination reached about whether this is is an existing authority? >> our position is that congress has to act. and that the clock starts running once the application is complete. >> yesk si, sir.

>> jonathan tyler from "the tribune." how do you square that with the finding that the disaster was a result of systemic problems that could repeat? >> the way i would swear it is that the companies that have not been implicated in this specific spill and that had been carefully inspected by mms immediately following the spill were judged to be in compliance with all known requirements and to have had an exemplary safety records are ready. over here. edward falker with "energy guardian." the they determine it was

inherently unsafe formation and should not have gone as far as it did? that at some point they should have abandoned the macondo well? >> i do not think we did conclude that. i know that is not the opinion of the industry. tom? >> as the well was drilled, operator recognized that there were inherent dangers to go further in drilling the well. so they stopped short of their ultimate target and decided to complete the well there then at that point. there is every reason to think in terms of the investigation that the well could have been completed and abandon safely at that point. there were, however, a chain of mistakes, errors in judgment made, as they went about that process. each of which could have been easily prevented. i think our assessment of the investigative team was that this

will could have been completed and abandon safely and came back and produced at some future time. there is, however, a recognition that as one trills the well even with the best geological reconnaissance information available, that the company will find unusual risks and challenges as they go deeper down the well. part of that is the safety case is to assess that in advance and a comprehensive way, while other than being surprised as one goes down and drilled the well. -- rather than being surprise as one goes down and drills the well. ith the "l.a. times." there is a serious and regulatory sentiment in congress. i was wondering if you could

tell us, given the priorities that you have that you will present to congress, what kind of reaction you have gone so far privately from members of congress to the recommendations that you are making? we will obviously ask them ourselves today but i wanted to get insight from you given this time it on where you expect to push back? >> i would say the answer is that as there are 535 members in congress, there are close to that in terms of their response to your question. i believe this issue and the searing impact at the deepwater horizon has had on a conscious of americans is such that it will override an ideological preference for less government, less government intrusion, less government cost. what makes that level of optimism i think credible is the

fact that members of congress understand that this is not just a typical example of government regulating of private enterprise. this is government regulating land of that the government and the people of the united states own, and that it must be treated as we are stewards of public assets, and valuable public assets, the gulf of mexico. and that recognition will cause, in spite of the reticence to accept additional regulation, this to be an exception. second, as has been said, we think a substantial amount of the recommendations that we are proposing can be adopted without congressional action, that is it is in the hands of particularly the department of interior and administration to execute.

and from the comments we have had thus far from the obama administration, i am very hopeful they will take advantage of that opportunity. >> let me add to things. the congress can reorganize the department of interior to make a safety enterprise totally walled off from general -- revenue generation. that can be done. it does not involve more regulation. that is as simple initiative they can take. we think it will be a guarantor in the future against revenue driving this program. we document through several of ministration's that it has. german upton, a german hastings, chairman hastings and bingaming have allnm

expressed interest and we believe will follow through with the recommendations. >> i wanted to ask you guys to talk about the recommendations you made with regard to epa. it seems after an event happened. was there any sense of given them a more up front role rather than leaving everything after the incident? >> the va has a national response center and has a role in preparing for any response. we believe there are structural changes that need to be done with respect to the area wide councils, and those are detailed in the report. one of the real surprises here, to me, is having overseen much of the response to exxon valdez in 1989, the status of the

dispersant question was still unresolved. i did not permit the dispersant to be in many of the sensitive areas because of fear that getting into the water column will contaminate the fish. remarkable to me that we finally have a spill, and they are predictable, that we then have the argument about whether it is toxic? does it persist in the environment? does it depend how deep it is injected or how much is? we make strong recommendations that epa seriously begin to test toxics, the toxicity of dispersants and their effectiveness, and to do so in real time situations. i can perfectly well understand why you when an application may go in through epa to deposit oil on the water and see whether something works to contain it or

dissolve it, that is probably ot left at the top of in bobox, nevertheless we think it needs to be done. particularly recommended be done in the arctic to find out how it would work in the icy waters. >> it has a major role to play in restoration efforts and recommendations that we have made and the secretary made. as you are aware, the president has asked the administrator lee said jackson to head a task force. she has been set up to make progress in an interim basis. she is leading that effort involving other agencies and the states. they will have a major role to play and the restoration programs. specifically one of the areas we point out is the alleviation of the so-called dead zone in the

gulf of mexico. this has to involve management and regulation and pollution sources. it is an area much larger than was actually affected by this oil spill on an annual basis. if we're going to restore the resilience of the gulf oil spill, this is one area we should undertake in this restoration efforts, and the epa has a leadership role in that regard. >> to be clear and contrary to my initial assumption going into the issue, we believe secretary jackson made a quite sound decision in the way to use dispersants in the way that she did. >> >> thank you. i'm from blue bird news.

the recommendation, how does this compare to how secretary salazar said we will do? >> secretary saws are made recommendations that are in direct response to the kinds of concerns that we have. he has now made separate leasing and revenue generation and a report to two separate secretaries. we respect that move. we think it is not enough. those two secretaries still report to racing will separate it -- deputy secretary and that deputy secretary reports to the secretary. we are supposing that there be a walled off enterprise that is headed by someone who is appointed for a term, someone who has industry knowledge or experience, engineering capability and training, and cannot be removed or politically interfered with. we think for the long term, that is the only way to ensure that

revenues do not again become excessively influential in decisions relating to non- revenue items such as the safety and environment. yes, ma'am? >> i am with reuters. i was wondering, with all of the additional regulations i you are calling for and things of that nature, is there any concern about further delays in the gulf? already, there are complaints that there have not been deepwater drilling permits and that drilling could be delayed until next year. is that something you took into consideration when you were planning for it, and is it a concern now? >> senator gramm? >> yes, we did take into account. as commissioner by niki just mentioned, we recommended an increase of time that the

department of interior agency should have to reviewe applications, but it was not an indefinite amount of time. it was 30 to 60 days. we are sensitive to the fact that there are costs, both financial costs and time costs, involved in these decisions. but think of the enormous liability that the industry has just brought upon itself as a result of the failure of -- failure to attend to the basic safeties, and thus, deepwater rise in. we think that the long-term viability of the industry in the gulf and its economic successes in the gulf are very closely tied to a new standard of safety and environmental protection, which is what our report will, i think, establish a path toward

bree -- toward achieving. >> we will take couple of more. yes, sir? >> john kingston from plats. how do you deal with the fact that if they hired a regulator, someone who understands the industry, the compensation package will never be on the level that the private industry can pay for and then presumably take that person away from boem. >> i will tell you two ways. the we've got to get the competition of for those highly trained, special-specialty, technical people. it is possible there are other agencies, like nasa, that have a pay scale that permit that. whether we can get it up to a level comparable to that of industry remains to be seen, but that is one thing that i think the regulator can be helped by having a safety institute with

industry people who are evaluating, auditing and inspecting, and who do have comparable compensation, as in the nuclear power industry. the people in the nonprofit industry that the industry has set up are every bit as eligible for pay also as those who are in the inspecting. and enforced regular will give us much more protection. >> in fact, i think the united states is the exception to the role. the fact is that most of the countries where there is a substantial amount of oil and gas exploration do compensate their professional regulators at a level that would allow them not to be out man. and interestingly, in great britain it has been said that if

there is one issue that ignites -- that unites the industry, it is the desire to have that strong, professional regulation, because the industry understands that it -- that its continued success, particularly in the north sea, is a direct function of how well it performs and that is, in turn, directed -- affected directly by the quality of regulation. >> last question. >> bill gibson with the sunset. please forgive me if you have covered this. what are the lessons learned from this experience in terms of allowing areas in which oil drilling should be expanded? should it be brought closer to florida's shores? >> [laughter] you are now asking me but a policy in a parochial question. -- both a policy and a parochial

question. i believe one of the issues that this has raised is the issue of the future of energy policy in the united states. at the current level of proven reserves and at our annual consumption of petroleum if america were to go to a drill- baby-drill philosophy, we would exhaust our reserves by approximately 2031. if we continue at the current of using 48% domestic and 52% imported, we will stretched that to the year 2068. i think that those numbers indicate the imperatives of having as part of our energy policy that we need to be holding back some areas that have potential for future

generations. and the absolute imperative of moving aggressively toward reducing america's almost insatiable appetite for petroleum, and appetite which today is consuming 22% of all sea,petroleum from the north africa, australia, as well as the united states. we're using 22% of it. those numbers are not sustainable and i believe our policy toward reaching out to areas that are not currently being exploited has to be within that context. >> and effective summary and conclusion airey statement. >> thank you. >> thank you all very much. well done. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]

>> the final report of the bp oil spill investigation. the oil industry come, congress and the obama administration need to do more to avoid another large-scale disasters, including training of purgatory agencies for offshore drilling -- regulatory agencies for offshore drilling. interesting to note that at the top of this news conference, commissioner co-chair and former senator bob gramm, probably emphasize the report came in under budget and on time -- probably emphasize to the report came in under budget and on time. we're going to leave this to go to patrick leahy, talking about the upcoming agenda for the 112th congress. this is just getting under way. >> he is part of with republican senator john cornyn -- partnered

with republican senator john cornyn. he was also the lead sponsor of the innocent protection act amount and in -- the innocence protection act, and in 2004 he co-authored legislation that would require dna testing and better access to competent legal counsel. long known for his work on congressional oversight, he led the judiciary committee's 2007 investigation into the mass firing of u.s. attorneys and the white house political influence over justice department decision making. it he has voted on the nomination of all current supreme court -- he has voted on the nomination of all current supreme court justices. senator leahy is also the senior member of the appropriation and agriculture committees and has long cochaired and energize the work of the senate national

guard caucus in its efforts to modernize and adequately equip a modern national guard of today. he and his wife have three children and five grandchildren. their home is in middlesex, vermont, where they live in a 19th century farmhouse that since segment -- sit snugly in the center of their farm. senator leahy. [applause] >> dean, thank you very much for the introduction. it does seem a little ways away from that farmhouse, being here, but charles, having you and your super staff hosting this discussion means a lot. you and i have worked together on these issues over the years. i must admit, when i started preparing this speech, bruce cohen and others in my office were talking about it.

things changed over the weekend. we should talk about the travel to events of this past week -- tragic events of this past week. it caused us to pause and reflect on the promise of our democracy and our responsibilities as its beneficiaries and stored. as we entered this beautiful building today, many of us passed by these magnificent words, the first amendment. it is carved in marble and the pennsylvania avenue facade nearly 74 feet high. "congress will make no law respecting an established religion and prohibiting the free exercise thereof, or abridging the freedom of speech or press or the right of the people peaceably to assemble and petition the government for redress of grievances."

parents used to say that everything we needed it in a democracy is in there. it promises diversity. practice of religion if you want, or non-if you want. -- or none if you want. the day before she was felled in the attack in tucson, congresswoman giffords was a member of the house of representatives whose role it was to recite these words on the house floor. in a free society -- "in a free society, in a society that we americans always want our country to be, the government must not and should not restrain free expression." but we learned as children that with freedom comes responsibility. the full flowering of democracy and freedom relies on the self

restraint of each citizen, organization, and group of citizens. the printed page, the radio microphone, the televised imagery, the tv ad all have the ability to inspire, motivate, and to inform. but they also have the power to inflation and inside. -- to enflame and incite. the seating rhetoric has gone too far. the demonizing of -- the sea been rhetoric has gone too far. the demonizing of politicians has gone too far we all share responsibility for lowering the temperature. it is a responsibility we all have. we have to keep our democracy strong and driving. the 530 members of the house and

senate have been elected to represent more than 300 million americans of all walks of life. we have responsibilities within our borders, but we also have responsibilities outside our borders. how has our nation charts its way in a very complex -- as our nation tour to sway in a complex and often very dangerous world. is time to stop polarizing symbolism and instead, work together on the substance of the many challenges that we face as a nation, otherwise, our country, a blessed, bountiful, expansive nation that survive the revolutionary war, a civil war, two world wars and everything in between, faces a decline. i cannot accept that. and neither should anybody in this room. you know, the dean mentioned i

am the only democrat elected to the senate from past history. shortly after i was elected, the boys in the background in vermont said, we ain't going to make that mistake twice. [laughter] i remember the words of roosevelt when he carried every state except maine and vermont. shortly after that, just before was born, i was born in montiel leer -- monmtpelier. there was the very strongly anti-roosevelt wayne. president roosevelt went by in an open car. my father was sitting next to

the president of the national life of that time and everybody wore hats. everyone in the company to -- everyone in the company -- the leader of the company took his hat off as a went by. and my father said, i never thought you would take your hat off to roosevelt. and he said, i did not. i took my hat off to the president. i think about that. we should show respect in the things we do. the pima county sheriff movingly called for soul-searching by all of us. we need to work with -- for the good of all americans. after oklahoma city, after the attacks of 9/11, we came together. again, we need to come together. the tragedy should summon us to meet the challenges we face, not

with emphasis on the issues that divide us, but on common ground those that can -- but our common ground that can unite us. it is easy to accept distrust and resentment and hay. leadership should appeal to the better angels. and one common ground -- when common ground remains elusive, we must respect the rights of others to hold their beliefs. and one more thing, we must not allow any assault, even this horrendous one c'mon representative democracy to succeed -- even this horrendous one, on a representative democracy to succeed in thwarting our government. i look forward to working with the new ranking republican of the senate judiciary committee, senator chuck grassley of iowa.

we have served together since he came to the senate in 1981, 30 years ago. we know the value of bipartisanship and civility. i began meeting with senator grassley last month. we set up the committee priorities. they will include matters that are important to both of us. let me go over a couple of those. senator grassley and i have taken a keen interest in fighting fraud. the first major bill that the senate judiciary committee considered last congress and one of the first bills we signed into law through president obama was the the enforcement and recovery act. we also strengthen the small claims act and we made sure that taxpayers would be protected from fraud and both the historical affordable care act and the walls redact. we need to bill in congress to

further that. at our january 26. we plan to learn more about the recovery -- at our january 26 hearing, we plan to learn more about the recovery act. those are our tax dollars may beckon to the treasury. the obama administration has been a partner in our efforts. we want to make sure that the newly enacted provisions are having an impact. we want to make sure there are adequate resources devoted to our anti- fraud and the enforcement efforts. as a former prosecutor, i can tell you these kinds of investments will pay a taxpayer's back many times over. americans -- will pay tax payers back many times over. americans are concerned about their investments at home. fighting fraud and protecting

taxpayer dollars are issues that both republicans and democrats have worked together to address in the past and in these economic times, we need to continue in that spirit of bipartisanship for every american taxpayer. we also have to focus on american jobs and protecting them. last year, and i know many in this audience are interested in this -- the senate judiciary committee unanimously supported bipartisan efforts to stop online criminals from stealing our nation's intellectual property. it has cost our national economy billions of dollars every year. our intellectual property based businesses are among the best in our economy and are among our best employers. they are part of our best sources of export dollars. we cannot stand by and see them ravaged. we cannot have american

consumers subjected to counterfeits. we will renew our efforts on this, this year. among our top priorities is the patent, reformat. there is bipartisanship to modernize our patent system. it has received considerable attention in the last several congresses and there are days that i feel my whole schedule revolves a round that. we are updating the antiquated patton system and that will keep america at the forefront of innovation and -- and acquitted patent system and that will keep america at the forefront of innovation. and the beauty is, it does it without adding a sent to our nation's deficit. i talked to the new chairman of the house judiciary committee, , and he agrees that it is -- patent reform is sorely needed. this is something in which

democrats and republicans can work together, can help the country, and help lower the tensions. senator grassley and i worked together over the years in confronting anti- competitive business climates, especially in agriculture. in the last few years, the justice department has become more aggressive in protecting competition. competition workshops held across the country -- and this is a very interesting thing. the joining of justice and the department of agriculture, not a partnership you generally see. that asing to build on we talk about the overconcentration in agriculture businesses. and i hope congress will finally repealed the health insurance industry's exemption from our antitrust laws. there was bipartisan support for that in the last congress. there is no place in our health

insurance market for anti- competitive abuses. and repealing this anti-trust exemption is a good way to start competitiveness in the health insurance market. there are ways that the judiciary committee can help our economic recovery. we can strengthen programs like the regional assessment program that encourages foreign investment, spur job creation in our state and local economies. i would like to see foreign money coming in here and creating jobs in the united states more than american money going abroad and creating jobs in other countries. senator grassley and i will look at how we can move forward with immigration proposals like ag and jobs, ways to improve these are programs like the h2a program and in doing this we know that there are some good

economic signs, finely. i think democrats and republicans to be working together on these measures. the american people expect us to work together. the american people expect us to make the country better. we have also seen -- excuse me. we have seen in the last decade and encroach on americans privacy. there is no other decade in our history -- the imperatives of security, the proliferation of data bases, the responding of social media has responded by having the choice of being left alone. again, we believe in this. i will tell you a story about one of the few things i have kept from being written about me

in the press and framed on my wall. it is a short profile. understand, we live on a dirt road on this very live piece of land, surrounded by another piece of land of a farming family that has known me since i was a teenager. it was saturday morning. a reporter gets out of his car and drives of to see this old farmer on the porch and he says, the senator leahy live up this road? the farmer says, are you a relative of his? no, i'm not. are you a friend of his? not really. is he expecting you? no. never heard of him. [laughter] we believe in our privacy. in the digital age, though, and in a time that is darkened by

the threat of terrorism, we face the difficult challenge of detecting -- protecting the nation from growing threats and the same time encouraging innovation and respecting privacy rights. the judiciary committee will continue the work we started last year to update electronic communications privacy act. i want our security agencies to have the tools needed to keep us safe from cyber threats, but i also want our federal privacy laws to keep pace with advancing technology. this is not an easy balance. but i think it can be done. we will examine several emerging privacy issues that are of concern to me and many americans. including the invasive full body screening at our airports and the tracking of americans activities on line. i want to work with the obama administration and with senators on both sides of the i/o to -- of the aisle to revisit the law

enforcement act -- the communications and law enforcement act, clear. law enforcementall - needs with privacy standards. was so muchs, there in technology that we could not have imagined since then. we have to update the law. but we have to have the same consideration that we had in the 1990's of balancing americans privacy right as well as the legitimate needs of the law enforcement committee to gather valuable court-ordered the servin is information to keep the nation safe. after 9/11, we passed the patriot act. and i am pleased that attorney- general holder recently agreed to have led the civil liberties oversight and reporting improvements that i suggested in

the usa page react improvement bill last congress. it is a good, solid step forward. now we have to take the next and extend certain provisions within the act that are otherwise set to expire next month. and in the annual report to the federal judiciary, chief justice roberts recently wrote of the urgent need to fill the federal judiciary vacancies. these vacancies have reached historically high levels. they are resulting in an overburdened court and they are facing crippling caseloads with litigants unable to have their cases heard. i will try to work with senator grassley and the senate leadership of both parties to lower those vacancies. unfortunately, this is another instance where partisanship has been a destructive influence. we need good and capable men and

women to protect the rights of all americans and uphold the rule of law. if we cannot ask people to take on public services they judge -- we cannot ask people to take on public services to judge and then ask them to deal with humiliating partisan delays in the confirmation process. and in another area, we can protect our national security and our constitutional liberties, but it takes care and foresight. again, this is not an area where we can use symbolism. we go to substance. do we want to be saved? of course we do. do we want to protect ourselves? of course we do. do we want to protect our civil liberties? of course we do. but let's be honest, it will take work to protect that balance. and-daytime -- today, we need

care and foresight because we continue to face the threat of violence. the american people expect us to do no less. the government of the people, by the people, and for the people, must be accountable to the people and we need oversight and government transparency. i think, again, where we can join together, republicans and democrats-senator john cornyn, a conservative republican from texas, he has joined with me over and over again to strengthen and expand the freedom of information act. it is neither a democratic or republican issue. it is an american value. we will continue our productive partnerships in foia issues. we have reintroduced the foia act and will improve

implementation. we will do that later this year. but you also have to do it by example. our pledge to proceedings of the dish you're a committee will be continue -- will continue to be available -- our pledge to have the proceedings of the judiciary committee available to all americans will continue. i know it works. i will get back to my office and will hear, what did you mean by that dumb statement? and then others will that agree with me. it is a special honor this year to be at the museum on pennsylvania avenue -- newseum on pennsylvania avenue, sometimes called america's main street. i was saying to myself, as we drove down here today -- i

thought how my parents would have loved the idea and the reality of this great museum. i think mom and dad would have heartily embraced the indefensible work of free speech and free press. do not ever stop. do not ever stop. it is so easy to argue for censorship in just this one issue or just this one issue or just this one issue. no, open, free debate. particularly, the freedom of information act is one that i share. as the dean said, reviewing the judiciary committee's is important.

just last week members of the 112th congress were sworn in, pledging to uphold the constitution. and i thank the monitors for including me in that ceremony. as john f. kennedy said, "to govern is to choose." i serve the majority and minority. with three democratic presidents and four republican presidents with different house and senate majorities. i know that we can be productive. i have worked with the republican house chairman to and that the first justice department authorization, and reauthorization 25 years. and i have worked with the republican senate majority to enact the citizens protection act, which provided post- conviction dna testing for those

wrongfully convicted. i look forward to continuing that tradition in the 112th. this is a new year. this is a new congress. in thise year started very tragic and troubling way -- but every year has promised for america. and in our committee we have a challenging agenda. we have the talents of some of the most capable members. how to advance these priorities is to, together pursue the goals to make ours a more perfect union. i thank you for listening to me. [applause] >> senator leahy will be glad to take some questions as time permits. at first, he will take questions from the audience. i think many of you may have passed questions to the aisle.

of should we begin with questions from the audience? ok, questions from the press. >> thank you, senator. senator leahy, in the wake of these shootings at fort hood by major alassane, there was a push by the president and others -- major hassan, there was a push by the president and others to withhold judgment about the man's intentions. however in the wake of the shortage -- in the wake of the actions in tucson, there was no shortage of speculation that the tea party was stoking the ideas of this individual, who had nuclear past. >> your question and said --

your question said that the president withheld judgment in the first instance and implied that he did not in this. actually, he has withheld judgment in both. i am a former prosecutor and i have tried a lot of murders. i have actually arrested murderers. i hold -- withhold judgment until the evidence is in. i think president obama is right in doing that. let us find out what happened. it was a heinous crime. a terrible crime. i want members of congress to be able to meet anywhere in this country where -- with their constituents. this is, after all, part of our open government ability to petition congress, to speak to congress. i do not want that to change. that is not what happened here. let's not get a tragedy mixed up in politics. the president has not.

i have not. i am more interested in finding out what the motivation was of the person who has been arrested. and my heart goes out to the families of those who have been lost members -- a 9-year-old girl. a husband who died protecting his wife. the super, qualified member, a highly respected member of congress fighting for her life. those are the things that we should be concerned about. the first question from the audience, do you believe cyber security legislation will move ahead this session? >> i think cyber security legislation has to move ahead.

we are losing billions of dollars because of the fraud on the internet, a lot of it from overseas. we face a reareal questions of r security. so much of what we do is done via computers and internet. think about heating systems when it is below zero in the northeast or other parts of the country and think of the devastating consequences of a cyber attacks. but also think of the billions and billions of dollars, counterfeit goods -- many of them are sold from overseas. people have lost their life savings. people have had their bank ruined duend credit respon

to lack of adequate cyber security. my guess is if we get the best -- i am working with government and industry, users, consumers. i am trying to bring them all in and make sure that everybody is at the table and doing this to get the best bill possible. but just like with clear, the bill we wrote in the 1990's, i can guarantee you that we can write the most perfect bill and pass it and in a couple of years we will have to revise it. i want a bill that can be updated and revised. the types of fraud that we are seeing and the types of security we are seeing are amazing. >> senator, we have two more questions from the audience. the first concerns pashtun reform. >> your management of the patent reform act is seen as a strong

act on a complicated issue. would you start up close together with mr. smith, or with a blank slate? >> i joked the other day that when i began working on patent reform by had hair. -- i had hair. [laughter] that was a blank slate. i do not want to go back to a blank slate. i think we have done an enormous amount of work. we have brought in many of the stakeholders. i know that some in my office have worked on this. there been countless meetings with stakeholders. and we have worked with the patent office, of course, and others. i think the bipartisan legislation we put together is a good step and a good place to begin. the short answer to the question, no, i will not start

with a blank slate. kabul work with both republicans and democrats in both the house -- i will work with both republicans and democrats in both the house and senate to have a bill that we can begin with. if it comes to the floor of the senate, it will pass. i would like to do it now before we get tangled up next year with presidential elections and everything else. >> a few more questions. first, what do you anticipate the senate will do in reaction to disclosures by wiki-leaks? >> i wish i knew the answer. i know the justice department is already -- has subpoenas out. we have been reviewing what the law is. they have been reviewing it for more on this. -- far more on this. as i said earlier, i believe in

an open government, but i do not believe in putting good men and women and around the world in danger. we have had to bring people out of other countries where they are serving at great risk to their own lives, serving to protect your safety, my safety, and everybody else's. they were very valuable in doing that and we've had to remove them from those countries because they have been exposed. and we have seen people in some countries who faced death or have been killed because of that. that is not responsible. i will also ask the obvious question. and i have asked if so many times in my office. what the heck do we have all of

this material for a private first class downloaded onto lady ?aga's cds that is one person we ought to ask, who made that dumb decision? >> the next question is, what are the specific plant -- specific plans being considered to strengthen eb5? >> let me explain eb5. it is a program where investors can come from overseas, invest in businesses in the united states, and they are moved forward in the immigration process of doing it. that is a layman's shorthand to it.

the news in different places in the country has been used very effectively. in my state we have a center for this. there has been questioned about issues in other places. but in most places, the news is well. i would argue that it should be a permanent program with very specific government oversight. government and congressional oversight to make sure that it does this. the money comes into the united states, creates jobs in the united states. americans are being hired for those jobs. frankly, as an american, i would much rather see money coming from outside the country creating jobs in america that american money going into other countries creating jobs there, especially when we have 9 +% -- we have 9% or more unemployment. >> we have three questions on the nomination process. what is your schedule for the

nomination hearings? and will mr. tree will likely have a nomination hearing? >> i do not think people who have already been nominated, had their confirmation hearings -- especially those went through the committee unanimously last year and were held up with a pocket filibuster on the floor -- they should not have to go through it again. i do not know how you ask somebody to be a judge and then subjected to a humiliating and unnecessary delay. i am urging all of us to back away from that. and the president in this case, he has gone across party lines. he has sought the advice of republican senators and democratic senators and we have had people recommended by republican senators that have

been held up. the we have got to get away from that. i will put on the agenda very quickly those who half already been confirmed. and i guess the president sent most of those names back up to us. laci bruce and ed -- i see bruce and ed nodding yes that they did. we will get them through. and we have to. there are so many vacancies. we have 85 district courts with vacancies. 16 circuit courts. i will give you an example. during president bush's -- george w. bush's first two years in office, the democrats were in charge for a year-and-a-half of that time. in that year and a half, we put through 100 of his judges, 100.

i just happen to have these numbers here. [laughter] and we were able to put it through -- to put through only about half of that in the first two years of the obama administration. we have got to get away from that. if you have got good men and women who are willing to serve, let them do that. being a judge is a procedure is office, but it is a very hard- working office. and it does not come without risk, as we saw this weekend. >> and senator, the final two questions from the audience also consume -- also consider delays in the process. what can be done differently in this congress to speed the confirmation process for judges? and the other is, the delays in

confirming federal judges took a tragic toll. l was slain in tucson. he attended that meet and greet to thank her for her support on the ninth circuit. what will be done in his memory? is the minority party willing to stop their obstructionist tactics and help justice be served in america? [laughter] >> i used to try cases and that was the leading question. [laughter] i'm going to go to the republican and democratic leadership in the next of of weeks. let's step backward and do some of what i did it in the first year and a half i was chairman during president bush's first two years. let's move trudges through quickly.

i will move them through -- let's move judges through quickly. i will move into the process very quickly. i will move them through the judiciary committee and they will be confirmed there. but then we have to get them down on the floor. if you have someone who is being confirmed unanimously in judiciary, the tradition has always been -- and then there on like, a friday afternoon, they go through unanimously. if you have to have a roll-call vote, you take 10 minutes to debate equally and then they get through unanimously. if we have some that are contentious, some that creates problems with either republicans debated.rats, let's vote yes or vote know. do not vote may be by holding them up. >> we have time for two more questions from the press. >> mr. chairman, you were the target of attack in 2001.

i wonder if you could talk about how that attack or this one will change how you interact with constituents or how other senators do. >> i had an attack on myself shortly after 9/11. i receive one of the -- or was addressed to me, one of the deadly anthrax letters. people died because the letter was addressed to me. and i still wonder who sent it and why they sent it. i will probably wonder that for the rest of my life. the capitol police were superb and provided security. i felt i did not need it. i feel perfectly safe in vermont, one of the safest states in the nation. i know the local and state

police in vermont have procedures for public meetings. in vermont, i'm very satisfied with what they are. i will not go into the details for security reasons. the capitol itself is very, very secure. when i think of what it was like when i was in law school, you just walk in and all the doors are open. it is a bit different today. i do not feel any worry being there. i would not want to see every member of congress walking around with security. we have for the obvious ones, the leadership and the speaker. i have no problem with that. but i do not want to see members of congress walking around with security. i think it isolates you from the people you represent. it is not the kind of country we are. i have been in totalitarian countries where every single person seems to have security.

people in some of these countries come to visit and they are surprised to see me get in my car and driving my own car, or driving home. i want to keep it that way. i think it would be a mistake if we put any more barriers. the one place we can really be ourselves is at home. i want that to continue. and the country's better off if we can. but i would urge, i really would urge -- and this is not -- i would urge this on the right and left. stop, every time you disagree with somebody in public office, stop attacking their motives and subscribing -- ascribing some kind of nefarious motive just because they disagree with you. we have good men and women across the political spectrum who represent people in this country across the political spectrum.

let's understand there are no easy answers to the problems facing americans. there never have been. there were not any easy answers in world war i or world war ii. there were not any easy answers during the great depression. but we have great men and women who came together and sought the best possible answers to make us a greater and stronger country. step back from the rhetoric. step back from the symbols and go to substance. start working together. this is a great and wonderful country. we are a beacon to the rest of the world. let's make sure that beacon is a little bit brighter than it has been. >> in the wake of last weekend, you think there should be more talk about gun control and do you see any legislative push for that on capitol hill? >> there will be, but i do not know if much will change.

that is an easy answer. it is interesting. vermont has the lowest crime rate in the country, lowest or second lowest, and it does not have control -- gun-control. but i would not want vermont laws to be in an urban area. we have to decide what works best. is that it? thank you. i really appreciate you being here. thank you. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> we are glad you all came. please feel free to move around.

>> the u.s. house is in session today. all legislative business will be done due to the shootings in tucson. there will be a short proforma discussion scuttled for 2:00 p.m. today and morning our speeches in just a few minutes. lizet of business will be delayed because of the shooting of gabrielle and deferreds. -- gabrielle giffords. and we will go live to the state address by governor chris christie in new jersey. he was the first republican to win statewide election in new jersey in 12 years. gov. christie is expected to lay out his 2011 agenda for the garden state.

you can see his speech live beginning at about 2:00 p.m. eastern here on c-span. >> there is a new way for you to follow congress with c-span pose a congressional chronicle. track the daily four times, read transcripts and find a full video archive of each member. it is part fdot video library. it is washington, a doorway. >> thank you very much mr. president, mr. vice president. you have honored me and my family by giving me an opportunity to serve you and to serve our nation >> with more than 80 appearances by william daley and more than 100 by gene sperling, you can use the c-span video library to learn more about the new additions to the obama administration, just two of the more than 115,000 people you can search and watch online anytime at our c-span video library. is washington, your way.

>> a live picture of the u.s. capitol, where you see the flags flying at half staff today in tribute to the shooting comes in arizona. rep gabrielle giffords among the injured. we do expect the house to address this today during morning hours features -- speeches. now live coverage of the u.s. house.

for morning hour debate. the chair will alternate recognition between the parties with these party limits at one hour and each member over than the majority and minority member for five minutes each. but in no event shall debate continue beyond 1:50 p.m. >> that completes morning hours biggest in the house today. members plan to return today at

2:00 p.m. for a short pro-forma session. the legislative business today. tomorrow, we expect them to consider a resolution related to the tucson shootings, which left gabrielle giffords critically injured. you can watch that live on wednesday at 10:00 a.m. eastern here on c-span. >> we are live now from the university of arizona hospital where rep gabrielle giffords is recovering from a shooting last saturday. an update now just under way. >> as long as we do not backside and as long as she holds her own, that is good and that keeps

us hopeful. but we have to play this according to her time line and not ours and we have to avoid the frustration that so often the family will feel, we the doctors will feel, and of course, all of you will feel she will take -- all of you will feel. she will take her recovery at her own pace. a penetrating injury to the school, really, the survival, let alone recovery is abysmal. she has no right to look as good as she does, and we are hopeful. but i do want to underscore the seriousness of this century and the fact that we have to be patient. >> as you know, the congress woman's husband is an active duty navy personnel who is an astronaut. the resources of the entire military have been made available to us. early on in this time process of what i did was i took advantage of that scenario and situation

and i asked two people to come here and give me a little consultation as to what we could do in addition to what we're reviewing. these are world famous people. the first is dr. james eckman, a retired colonel in the u.s. eckland, a retiredlinto colonel in the u.s. army. he is currently the chief of surgery over in fairfax. and then dr. jeff lean, colonel ileana is active duty -- colonel ling is active duty and probably the most well known heroin -- most well-known neuro intens ivist the country. he was on his way to afghanistan when he got that mission avoided and was able to come here and give us an in-depth consultation

on the congresswoman. they will make brief comments and then we will not -- not being questions and answers, but they have a prepared statement and will make a comment or two. . .

this is a very serious injury. make no mistake, she was shot, bullet did enter her skull, the bullet did traverse through her brain and then exited out the back leaving behind some fragments and some bone. so she is critically ill. the good news is that she is in fact thriving under the very good excellent care that's happening here at the university of arizona. however it is going to be a process now where her recovery is in fact very much dictated upon her own recovery. and that's going to be a process that's going to take some time, it will be day bidet. but i believe with the whole support she's getting here from the hospital, from the nurses and doctors, as well as the community here in tucson and arizona and in the united states, we are all very, very hopeful. but i want to reiterate, she is very critically ill from a very

serious injury. >> thank you. health care issue we have in this country is the number one cause of years of lives lost. it outdoes cancer and anything else that you can think of because it affects the young as well as the old. and there are many people that are injured in this unfortunate circumstance, people injured every single day. however i know that we have one particular person that we're always very interested in, however there are many sides to this story and there are human beings involved in this from every aspect. so with that, we have several additional people that we're going to make available to the staff here, angela robinson and penny wilson who are daughters of a woman discharged yesterday and also bill helmond, her husband is currently undergoing surgery now and if you'd like to talk to them they'll be available here. i'm going to coordinate that with katie reilly here, our

p.o. officer. ok. we'll go ahead and ex cuse the physicians out of here, but we'll go ahead and start with mrs. starter's family. what we can do is you can start off with a statement or we can go straight into questions and answers. >> i'd like to start with a statement. >> yes, please. >> i guess thank you for being here. we've been rather hesitant to discuss this. i think my first statement, our first statement as a family, we speak for darwin's daughters and four sons and our sisters, there are four of us. our first statement would be like to compliment the hero that lie in our father and we're just blessed that he's walking with the lord now but what a way to go. as the hero, he lived that kind of a life. i also think at this time we would love to say that it just brings the hero out in all of us, at times of tragedy,

differences don't matter in families, whether you're divorced, single, in between, as a scoom counselor i know that families have to come together no matter what in and this is a time that we all should join hands fored good of all and find the hero in every single one of us. week of seen each person's positive qualities rise to the top as we've all been able to endure this and make the next arrangement and go step by step with what happens next with dad. >> and we just are very appreciative to everyone who stepped forward during the tragedy and went forward, there are so many people to thank. there were people oned scene that sat with our parents, prayed with them, helped them as well as everyone else. there are volunteers that are

organized as well as unorganized, volunteers that stepped in just immediately. the hospital staff, the f.b.i., everyone has been extremely helpful and we appreciate that. our mother is doing quite well, actually. she has a lot of strength and -- >> courage. >> courage and she will go forward. she has a long road ahead of her but her condition is good, i think. she's resting and we just appreciate everyone. >> thank you. >> i'd like to introduce bill helmond. he's going to make a few comments as well. >> good morning. my wife susie was the parent that took christina tailor green to this event. we've been here since 2006. my wife and i were fortunate to be able to take two years and look all over the country to pick a community that we wanted to be part of and tucson is the one that we selected.

feeling that it was one of the most natural melting pots of america that we could ever find. it's been a very, very decent community to us. so this event i think is extra shocking because of that. i have to say my personal experience from initially getting the call on saturday from an anonymous woman on the scene who let me know that susie and christina had been in an accident and i'm down in the emergency room here and one of the first people i met was a minister who had heard the news and walked in off the street, not part of the staff, but was there comforting people, that's my tucson, i was later not being a particularly religious guy, my hand was held by a woman who said a prayer that since has made me feel was particularly influential and giving my wife some good luck that first day. she was operated on saturday by the trauma surgeons, she had been hit three times by bullets. thankfully spine and organs

were all in tact and her biggest issue on an ongoing basis is a fractured hip which is being addressed today as we sit here. there's been heroes involved in this from my perspective, from day one, including those good people in the emergency room who dealt with this incredible chaos but looked to the feelings of all of us who were so unknowing and so scared as to what were going on, to every nurse, every orderly, every doerr that -- doctor that we've met so far, i'm so impressed with the quality of care we're getting from this institution and the quality of people and how they operate and the care they take for the feelings and sensitivities of us that are going through this. susie's going to be fine long-term. not sure she's going to be quite as actific with all of her physical activities for a while. she'll be in a walker for at least three months and serious physical rehab after that. but she's a tough, strong woman and a survivor. the greens very much remain in our prayers every minute. they are dear, sweet friends of

ours who have been from the get-go trying their best to take care of susie, despite the loss that they personally suffered. the graciousness that that couple has shown, given the tragedy that they've experienced, is unlike anything i've ever experienced and beyond the safety of my wife and those of the other victims, i most pray for john and rocks an-- roxanna green. >> thank you. this is a difficult moment for these family members, but we'll open this up for a brief period of questions and answers. >> doctor, could i ask you, it sounds like after further analysis by the military doctors, -- doctor, you're con vinlsed that the wound -- con vinlsed that the wound went -- convinced that the wound went to the back of her head. >> there's an entry and exit but we can't be sure. we do think from the expertise that they're giving to us, it probably went in from the front and came out the back.

>> can i ask the daughters a question, please? we were speaking with mike novak who is your mom's pastor yesterday. he said he's spoken with your mom and said that she felt that doery had really saved her life. >> absolutely she did feel that way. he heard the shots and covered my mom with his own body and protected her and saved her, yes. mom definitely felt that way. >> i think further of that is because dad lay dying, mom didn't know she'd been hurt. she thought that she was holding him and her legs started hurting and it wasn't until they got to the hospital that she even realized she had been shot. >> sounds like a couple that really came together in a very, very -- >> it was a beautiful way to say goodbye.

and go home. >> you can tell us more about where your wife was when this happened -- [inaudible] and how she's really mentally having -- [inaudible]. >> susie and christina were holding hands in line waiting to shake gabby's hand. they were there because my wife is very active in the community that she lives in and she had become, when the greens moved to town about a year after we did, roxanna reached out to the community with help with baby sitters and such things and susie answered the email and they linked up and became quite good friends in. in the process the green children have been at our house and we're aspiring grandkids with kids that aren't married yet. susie and christina are general racially apart but very much birds of a feather.

when christina was elected to her student council and started to express interest in government and the notion of helping people, my wife had been a social worker in new york and chicago and again of that ilk and susie started looking for an event that she could share as they have done many number of other things and gabby's event made all kinds of sense, both from my wife's personal political preferences as well as the fact it was a magnificent chance to provide a positive public female role model for little christina. so the two of them were together holding hands and most of what susie has shared with me about the specifics are on the edges of a morphine-endeuced haze so there hasn't been a clear, precise discussion, from time to time and moments of discomfort things come on -- out. she's recalling and having memories and flashbacks of

uncomfortable moments. i don't feel prepared today to put together a cogent timeline of exactly what occurred. i hear her in her semiconscious ramblings screaming out, christina, christina, let's get out of here, let's get out of here and she keeps talking about the holding of hands and then the realization that she was on the ground and the bleeding was profuse. her memory seems to end there. >> does she know what has happened to christina? >> one of the first good impressions i got from this institution was when i was pulled aside by a social worker who rightfully identified that the toughest issue that was likely to be faced by susie was dealing with what happened to christina. and again my wife has worked in and with families that have dealt with terrible tragedies in her prior social working career and in her clearest headed state she is quite understanding that this was the act of a mad men and -- man

that -- mad man and that blame does no good for anybody but we're humans and have dark moments where the inevitable occurs and we're going to have that as an ongoing issue to deal with. what i wanted to make sure everyone knows is that to the extent that that mindset sets in, it's not being induced by anyone at all whose been involved -- who's been involved and certainly not by the green's parents, who the morning after the incident, roxanna sent us a lengthy email and john and i had been playing telephone tag until yesterday but we got together and we cried for about 10 minutes. >> your wife knows -- >> oh, i'm sorry. susie had a breathing tube removed late saturday evening, the very first thing she asked, she grabbed my hand and said, what about christina? we were advised that the exact right thing to do which happens to coincide with 40 years of

knowing her and knowing there's no other right way to deal with her was to tell her the exact truth which we've done. i was initially very happy she was full of morphine. i think it may have helped soften the burden somewhat. she's only kind of coming out of all of this very slowly and i don't know for sure all of what is truly -- what has truly been absorbed at this point. >> in all likelihood she and christina were holding hands when they were is not >> yes. -- shot? >> yes. >> i have another question for the ladies. this has been a very difficult time for you. what if any thoughts to you have for the man accused of doing this? >> we're not going to answer that at this time. god takes care of that. >> could you tell us about your parents' life together before this crime? >> they married 15 years ago,

they were sixth grade girlfriend and boyfriend and they had a wonderful loving life together. it was quite a blessing for them as well as the extended family. they were very happy. >> did you say how many years ago? >> 15 years ago. >> but they were high school -- >> they were sixth grade girlfriend and boyfriend. and then both of them lost their spouses, both of them had been married 40 years to wonderful other mates and when their mates died within a year apart, my mom -- our mom moved back to tucson and dorie moved back to tucson. one was in washington, one was in oregon. they remet and married shortly thereafter and it's been a blessing for all us. >> where did they live? >> tucson. >> was there an event that they went to? >> they were both very good friends with each other's -- dorie's cousins. caroline and jack. and caroline and jack

reintroduced them and they decided to be boyfriend and girlfriend again for the rest of their life. >> will you tell us your relationship? >> we're sisters. tammie wilson. -- penny wilson. >> i'm angela robinson. >> you're both -- >> we're her daughters but i'm claiming him as my daddy. he was my daddy. >> has your mom been conscious enough at all to know? >> yes. >> they'll be able for further detailed questionings if you want. >> i think this is one opportunity so one or two more questions. >> has your mom been conscious enough to know what's going on?

[inaudible] >> mom's been very aware of what's gone on from the very beginning, i think. >> is she aware of the show of support that's been played out here at the hospital? >> yes. she's very grateful, she's very aware of what is going on and the kindness and just the huge outpouring of support for everyone. >> we heard that dorie, that he was a volunteer here at the church here, just fell off a ladder or something like that. what kind of a guy watts he? >> he was a busy little guy. he took care of anything that was broken, was going to break, he was always thinking about how to fix and repair and help anyone and everyone that he could. he was always available for that. >> i'm getting a signal so we're going to probably wrap

this up. again, i appreciate everybody's cooperation. you guys have been fantastic. obviously it took a lot of courage from the family members to do this. so thank you very much. >> thank you. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> latest on the condition of congresswoman gabrielle giffords from the university of arizona medical center. doctors again indicating that she is breathing on her own after being shot this past saturday. we will keep you updated on her condition as we get more information. a live picture inside the rotunda of the cannon house office building on capitol hill. capitol staff, members of the public have been signing a book in tribute and support to congresswoman giffords. the u.s. house tomorrow will

gavel in to consider a resolution related to the shootings in arizona. we will have live coverage of the house starting at 10:00 a.m. eastern here on c-span. remarks now from nina olson, national taxpayer advocate, on the complexity of the u.s. tax code and recommendations for simplifying it from today's "washington journal." "washington journal" continues. host: we're welcoming back nina olson, irs national taxpayer advocate. this is your tent report to congress. in part of this, you talk about the new health care law. is the irs prepared, and what will be the role of the irs under this new health care law? guest: the irs is prepared -- as prepared as anyone can be where an infrastructure is not in place. we try to cover in the report -- to outline what would be expected of the irs.

it is going to be the interface for many taxpayers four major provisions. the subsidy to individuals to help purchase health insurance, the subsidy to small businesses to help their employees purchased and pay for health insurance -- purchase and pay for health insurance. on the other hand, it will also be the disciplinarian, if you will, for small businesses -- or businesses, not small, other businesses, if they are not covering their employees and an employee qualifies for the subsidy, there will be a tax penalty. then, of course, there is the individual mandate, which is basically saying, if you are not -- if you are an individual and you do not have health insurance, either through your employer or you yourself purchasing them, and you're not low-income and me a number of other exclusions, you will have

-- and a member of other exclusions, you will have a tax penalty. that put the irs right in the middle of this. host: "this will be bigger than y2k for the irs to implement." what do you think? guest: i don't know how big y2k was. i have been in practice since 1975. it is certainly the most major social program that we have undertaken. that reallyls might accomplish on the trip. this is an hour, 40 minutes.

>> >> good afternoon, everybody. welcome to the nixon center. i am pleased with the turnout. if i could remind everyone to turn off your cell phones, please. please turn them all the way off, not just to vibrate, just reduce the electromagnetic interference in the room. i will introduce the speakers and moderate the question and answer period. we will try to wrap up by:00 p.m. eastern, if not earlier. first, let me welcome our speakers. we have a great panel of experts, and definitely coming to talk about a complicated and very important issue at exactly

the right time. as all of you know, secretary gates left for beijing this weekend and is spending two days, three full days in beijing. he met yesterday with -- had and hewith a geneareral met with the vice president. tomorrow, he will meet with president hu jintao. secondaryit the pla artillery headquarters and he will make a trip to the great wall. this is not tourism, but it is a great opportunity for him to see the long history of china's defense infrastructure. [laughter] so i think his trip marks a fairly important moment in the bilateral relationship. it's been a rather tense 12

months since last year when high-level ties were virtually at a standstill, cut off after the announcement of arms sales in taiwan at the beginning of last year. i think there re a lot of incidents that we watched carefully, snubs both ways, insults' in a very public forum, and a mismatch expectation. hopefully, this is the first or one signifant meeting that will help but the relationship back on track. i do not think there are any expectations for civic and breakthroughs on this trip, but there were two -- for significant breakthroughs on this trip, but there were two at were announced last night. the pla general who is the chief of the general staff will visit washington, d.c., at some point this year. a date has not been set.

i think there was also an agreement that was wtten up in "the new york times", as they put it, "an establishment of a working group to talk about more talks." so at least we see a consensus building on both sides that there should be more tal. that was one of secretary gates's key messages, that talks should be sustained and not cut off for political purposes. obviously, there is a great deal of uncertainty and mutual distrust between the two sides. we have three panelists that are our watchers of both the u.s. and chinese defense establishments. who can give us a their interpretations and their impressions, expectations on both sides and outcomes for this visit. i will briefly introduce them both. their biographies are out front on the podium, so please help

yourself to that, as well as a guest list for the event. but i will first start with mr. vago muradian who's the editor of "defense news". he was previously the managing editor of "defense daily international," and he covered global operations at "air force times." next, we he the director of the chinese national affairs of the defense university. previously, he worked at the monterey institute for international studies, where he served as the director of the east asia and non-proliferation program from 1999-2003. previously, he worked on asian

policy issues at the u.s. air force as an officer. lastly, we have dr. james mulvenon, the vice president of defense group inc's intelligence division. and he is one of the foremost experts on chinese c-four isr, and defense research and development organizations and policy. he is the auth of "soldiers of fortune,"which deiled the rise and fall of the pla's ventures in capitalism. with that, we will start with vao. o. >> thank you very much. as the late richard holbrooke one said, the most important bilateral relationships the one between the u.s. and china,

and how to sha their relationship is something that has consumed an enormous amount of time by success of the administration's, given that that relationship touches every element of u.s. policy, global interest, and just about everything and all -- involving china seems to be hard. china is essential to progress on the thorniest issues on that north korea, iran, energy, etc.. in the eyes of some in washington, it is a growing security issue in its own rite. while tactics continue to be debated, there is consensus that they need to work to engage china to foster a greater understanding and a greater openness. the last thing anybody in washington wants is to have this relationship go sideways and return chianna into an enemy.

improving the spirit of understanding is one of the secretaries goals. nobody has any of it -- any illusions that there will not be more significant challenges coming down the pike. and, obviously, some of the progress we have seen is something very important. everybody in the administration has continuously said that to build a lasting relationship you really need to increase the dialogue, increase the openness and communication, reduce the risk of this population and reduce the risk of misunderstanding. china has used that as a bargaini chip, unfortunately. while improving the short-term is a valuable through new working groups, the future is somewhat more challenging. transforming -- china claims to

want a military befitting its global status as a rising power. the trouble is its actions, is lack of transparency, and clear intentions replace the u.s. as asia's hegemon are what are worrying the region and folks in washington. under the hide and bide strategy that china has adopted for some time, there has bee steady progress to what folksn washington viewed as the anitti- to force theial u.s. out of asia. whether it is to rely on a wide missile arenal in the region. the aim has then to convince america's regional allies to

cozy up to them. as the w. director policy planning said last year, as the current war has dragged on for long time without a decisive outcome, this aggravates its strategic thursday and iv

maneuvers on other issues. terms for growth is no surprise, but it is something that washington has downplayed for a number of years. you get more for your you on the new get for your dollar. their ability to expand has focused on espionage a search and gaining a advanced technologies from the thousands of commercial and manufacturers that produce their wares in china. what is clear is that the capabilities that are being developed are significantly beyond what most people would reasonably assume china needs for its immediate consumption. all of this is bearing fruit. we have seen the headlines of the past few years.

china is still finder surprised washington. -- china's stealth fighter surprised washington. we do not know if they work. we do not know if they do not work. they show evidence of intent and china's trend to close the capability gap with the united states. to be clear, despite chi's soviet-found military remains inefficient. there are a number of structural aws.

breathtakings commercial rise suggests that it would be a significant mistake to assume that it would not get its military act together, perhaps sooner rather than later. china's defense minister has said that china will continue to press ahead in its advance of military capabilities. it will also respond to security challenges or threats by cutting off trade but also the supply of vital minerals. the united states is beginning to respond accordingly, but it is doing so cautiously to play it needed to hot nor too cold. the most important announcement that secretary inmates -- the secretary gates made was penetrating bomber. i do not think the decision was a coincidence. but it is evidence of superdelegates reorienting to

think that their weapons, including nuclear arms, will deny a sist to their air, sea, land, space, and cyber domain. i think that china would have gotten away with it had it not been for the bolder and more aggressive stae chinese officials have taken in the past years. it is grounded in the view that china is the sending and the u.s. is declining. there is a misunderstanding of several u.s. initiatives from the new administration's good- faith out of reach in the beginning to please beijing to keep u.s. debt. they did not approve fighters going to taiwan and they did not approve meeting with the li lama. i think china's view of the united states is summed up by the reaction to the defense

review which headlines described as "u.s. arrogance replaced by strategic contraction." by listening to their own rhetoric, the chinese leadership, some say because they are surrounded by superfast, dramatically over played before last year and the high progressive stance on core issues, bullying smaller powers, and sweeping territorial claims, and prompting them to strike ties with washington, something that american officials have been all too eager to take a vantage of. america has increased its diplomatic and military outreach in the region. interestingly, regional states that have held long standing animosities are forging closer relations. obviously, north korea is the driver.

they recognize that ina is the fundamental element of those discussions. the challenges that china's military is being led out on a longer lease during a time of political transition during which nobody wants to appear to -- once to appeared weak. this comes as the rest of the world deals with north korea. china does not see eye with the u.s. on the spirit leaves -- on this. its view of controlling the spread of nuclear technology is, i think, are different. it depends on whether those technologies will be used directly against them. it is significantly different

from other -- from how other countries you it. as americans, we see as an assistant security guarantors'. as an open society, we do not see our selves as a threat. but china is a nation with a long memory, a historic superpower with internal strife and external meddling, including the western powers. that has bred a curious blend of areas, paranoia, territorial ambition, and concern of losing face. we have to be ready for a nation that, as it grows, will become more difficult as it becomes more assertive. we have to be attentive, clearheaded, and smart on how to engage china.

on the part of u.s. leaders, unfortunate, anything else would embolden beijinghich may show weakness rather than prudence. i think secretary gates, the surveillance missions is another issue. i think the secretary gates has it right. thank you very much. >> let's go back to 2008. let's do a review of where china was. they had a policy toward the region that was spectacularly successful. it showed that china's economic rise presented opportunities for them economically. it became the no. 1 trading partner, even for u.s. allies such as japan, south korea, and taiwan. with a new administration coming

into office, it was determined to not make the mistakes of their precessors, not spin to the campaign, talking tough to china, and spent the first year in office repairing the damage. the obama administration was careful about what they said in the campaign and thought she teasingly about how they wanted to engage china. the focus was recognizing china's importance in solving regional and global problems. you had administration coming into office the reached out its hand, wanted china to play a greater regional role and their role with global institutions, was willing to facilitate china's entry and expansion of chinese voting rightsn some of these institutions. and wanted to make china a

cooperative partner on a range of issues that is a -- -- issues. that is a good position to be in. if you look at where we are today, a lot of that has been since thrown away. the essential question is why? what explains that. the initial peace with the global financial crisis, which panicked chinese leaders -- it's all their exports plummet. they sought employment -- they saw their exports plummet. they sought employment damaged by it. as the crisis went on, they saw they were recovering faster than the u.s. and europe and maybe this was not such a great threat as they once feared. instead, they saw a shift in the balance of power that had been occurring over time, perhaps accelerating as a result of the

stresses. that is a key factor. but the key thing is that, even as the obama ainistration reached out a hand and offed cooperion and engagement, the proper response was some suspicion. why are they doing this? why are they offering to expand cooperation to give as a greater voice in instinet -- in international institutions? it must be to tie is down, to make is make commitments that will threaten our economic growth, to buy into supporting a u.s.-dominated system. i think there was a huge opportunity. the u.s. government -- the chinese government that that is suspicious and decided not to pursue it. instead, we have seen the balance of power within the region and globally shift in their favor. this became the opportunity to take more verbal positions on a

number of issues and take action, especially within the region that reflected this perception. about the first year, the year 2009, it was focused on this. how china defines problems, they are always responded defensively to what other countries are doing. one of the earliest manifestations of this was in the south china sea where a number of southeast asian countries with claims to these islands made a declaration under the un convention. they did it for their own particular reasons. there was a deadline in may 2009. but there was a concerted u.s.- led organized effort to challenge chinese claims in the south china sea and the east china sea. that is how it was framed in the debate and prompted what they characterized as a defensive response and what everybody else in the region sees as a much mo assertive policy to reinforce and protect those

claims. part of this was the issue is the impeccable in the south china sea when they harass of thu.s. navy ship operating there. but there has been a host of these kinds of things. the key is the resistance and the balance of power had shifted. there were no longer so bound by u.s. demand. they did not have to be so attentive to what other countries thought. that has prompted a shift in policy that has cost a lot of concern in the region and caused a lot of countries in the region to reach out to the u.s. and encourage the u.s. to play a more active role to balance the chinese policy. another way of thinking of that is that, 10 years or 15 years ago, a very skillfuliplomacy, listening to what countries wanted, tried to frame their proposals in light of that has been replaced by a tone deaf, assertive diplomacy focused on narrow chinesenterests, such

as maritime claims in the south china sea, bullying other countries, sometimes publicly, sometimes in diplomatic regions military commentators certain ways.n a i think a lot of those games from the last decade have gone away. how does that relate to the u.s.-china secretary's trip? if the u.s. was encouraging china to do more, we mt need china more. that reflected a shift in the balance of power a the balance of need and now china could be the commander if they wanted it -- it could try to set the agenda and press the u.s. on concessions onssues, such as taiwan, try to get restrictions on where u.s. navy and u.s. air force ships operated in of hours -- in waters and airspace and

that they have the power to push these issue and have the leverage to try to get concessions. but if you look at the relationship, they have not gotten very much. they have not gotten anything on taiwan. what we saw were shifts in timing so that the president did not meet with the dollar llama in one trip, but he did meet inth -- with the dali lama bu one trip, but he did meet with him and another. it has created a lot of tension in the region, a lot of concern in the u.s.. as we have seen, some of the modernization efforts pay off, assertiveness coupled with the abilities payoff and what does that mean for the u.s.? i think that is the context in which strategic dialogue between

the u.s. and china is important. you have a china that is now a big player, certainly within the region and sometimes at a global level, whose nuclear capabilities, whose space and counter-based abilities, it's expandincable operations, whose cyber capabilities are things that affect regional military balances and directly affect the u.s.. that has prompted an effort to take china more seriously. it does give them face in some ways. but itlso potentially makes them a target. this is a key question. from the u.s. side, we view military to military dialogue and as an understanding on these issues, reducing suspicions, finding ways to operate in proximity to each other without damage or without risks of accidents or incidents.

and so we see this dialogue is really important for working out a new strategic relatiohip wherchina is a stronger global player. that is partly behind the call for a strategic stability dialogue to address some of these issues. i think they have been reluctant to do this. if you look at their willingness to cut off talks over nuclear arms sales, schedules were full and those kinds of issues, it shows that there is still a reluctance to engage seriously on this issue. will the secretary's visit change this? i do nothink so if you look at

the timing of it, it is kind of squeeze been. it is important to the chinese toave this as it happened before the summit between hu and obama. there is the importance of talking about the strategic issues. but thchinese side has willingly -- has been cutting the sock. it would have been a u.s. talking point and focused a lot on that coverage. as it is, they have squeezed in before the summit yet without time for any agreements reached during the visit to really be implemented or to have the summit visit be a kind of follow-up "how are we doing on this?"

i do not see a fundamental shift in the suspicion that they have or the view that the military- to-military situation is a practical lover that they can use to try to get concessions on the issues that they care about. the dialogue will continue to be difficult. our first to talk about our ships and planes operate in proximity to each other, sending military -- maritime communications' agreement -- they have not been unsuccessful. they have -- if they're viewed as not operating in our space, there's not a problem. there is an exclusive economic zone that is part of the global commons. i think the secretary's visit is an opportunity to talk about these things. i hope that a working group will lay the groundwork for more

substantive dialogue. there are some positive sis that is a consequence of china's rare power. they phyllis laurel then maybe we're willing to talk about. there are some signs of that of the last six months or so. i do not see big breakthroughs and i think this issue of w the u.s. and a china that is alonger militarily get with each other. >> thank you. james. >> all of you have been the third position of a three-person channel. there really is no point in preparing a thing. [laughter] you have about 15 minutes to react to the first peoples comments and then your off to the races. i think they have done a great job of setting a share to a teen

center. i want to look at the operational goals for the visit. if you look at the recent speech by secretary schiffer and the statement by the chinese and extrapolate out of it for the future as to whether any ofhe water in these will hold. with many of the pioneers and practitioners here in the room, i think i will be brief so that we can have a good dialogue about it. i would like to reemphasize -- when we talk about our six principles and are four goals and are three characteristics and are key points from mike's speech, tre is a continuous theme, which is the why it matters question. we think -- until we have gotten incredibly lucky last 10 years and we have not had a very significant accident or

collision of one sort or another with the chinese military that has resulted in significant loss of life. i believe we had the hostage crisis in 2001 and then we had the recent unpleasantness, but all of those -- all of you in the room know that it could have gone a lot more sideways than it did and it could of been a lot more dangerous. the dilemma for me is -- i still don't have any confidence in the protocols, if any, whether it is crisis management or strategic communications, which seem to have fallen apart and not work as we would have liked in every single one of those crises. that would be very as look for a situation, especially if it involves tie wanted because the new have a triangular escalation.

so i do not worry about -- something that signals to the national defence global commission. i do not worrybout that as much as i do ather 83 or another impeccable where things go much worse than they did in the past. people buy. we float search and rescue forces to the area. and the net result of that is that we are outhere trekking each other with radar. no one is entering a hot line. years of dedicated contacts and the military region and the national staff cannot match the