>> today on c-span, "washington journal" is next, live with your phone calls. later, former u.n. ambassador and the congressional black caucus looks at the recession and deficit reduction. in about 45 minutes, a discussion about federal spending and the economy with matthew mitchell and isabel sawhill. then nyu professor paul light on the president's state of the union speech and the proposal to decrease the size of government. [captioning performed by

national captioning institute] [captions copyright national cable satellite corp. 2011] host: as this month draws to a close, protests industry to grow and arab nations. we will show you the latest headlines and many of the opinion pieces in the newspapers. our question for you is -- our protest, what should the u.s. though -- arab protests, what should the u.s. do? here are the phone number -- good morning. let's go to the wire services to get more information. first, the ap. egyptian authorities trying to stop protesters from organizing more mass rallies.

we would like to hear from you with your telephone calls about what the protest mean for here -- us here in the u.s. states, and whether there is a role for us. the phone numbers are on the screen. also, urgent from the associated press. police used water cannons on egypt's democracy leader. it suggests that police used water cannons against egypt's

pro-democracy leader and his supporters as they join the latest wave of anti-government protests after friday noon prayers. police used batons to meet some of his supporters who surrounded him to protect him. we would like to specifically invite arab-american viewers. to help us understand some of the context of the stories, that would help all of us learn. let us begin with a telephone call from miami. ron on the democrats' line. caller: thank you very much. the problem with all of the arab countries surrounding israel is we set up all of these puppet governments, and what they have done is gone and the interest of israel and not the people. host: what do you see as the interest of the people? caller: they want a democratic society. and all of these regimes that

the united states and israel support are there to only protect israel. please, watch democracy now, amy goodman and mosaic news from the middle east, linktv. host: fred is a republican from fairfax, virginia. is there a role in the u.s. now that young people and others have taken to the streets and places like tunisia, egypt, and yemen? caller: i am from the middle east. what i am suggesting is the united states should not ask why, because aching for 28 years is a king -- a king for 28 years is a king. you did not have to go any further.

they have to change -- no matter if they promised change. that, 9/11 iso going to happen again. those poor people, they don't have any hope. in the information ministry that they have, they get the people scared. host: the whole issue is about the rights of the public, including the ability to speak, more democracy, sense of authority and the economy. we are asking you, what should the u.s. do about the arab protests? today is called a day of rage in egypt. we've got some video that we

will show in just a couple of minutes that has been posted and widely available in yahoo and the dredge report and other places. michigan, this is tom. you are on the air. tom, go ahead. caller: yes. i think the american government should do nothing about what is going on in the middle east. there are americans living in all of these countries. i know somebody who is living in beirut and studying arabic, and that is what she does. she travels and studies arabic in different places. there are a lot of people like that who are americans living in the middle east right now. i really don't think it is our part to get in the middle of anti-government protests right now in the middle east. even with the oil that we import so much of it. i don't think that's a play a factor in what our -- that

should play a factor in what our country should be doing. host: some say there is an opportunity for the united states -- to support democracy movements. caller: you know, spending the last 25 years living in and around detroit, you need to muslim iraqis as well as chaldeans and when we invaded iraq, everybody that i knew who had family members living in iraq, whatever their ethnic heritage, said the same thing -- they didn't want democracy there then and they don't want it now. host: thank you so much. sam on twitter has the same ideas -- the next call on the egyptian protests, tunisian protest and

also in yemen -- kevin, independent. caller: how is it a democracy when we are trying to go over there and for said in a way? it doesn't really make any sense. i have a brother who served in afghanistan and a dad who served in the military. is our government thinking about the u.s. families here? we have enough problems on our own soil. why are we always going abroad? guest: thank you for your call. this video message, if you go to drudge report or yahoo, this is getting circulated around the internet, showing recent protests, including one young man described as being shot in the streets as the protests continue. we will watch that and take our next telephone call from michigan. this is leah on the republican line.

caller: i am delighted to call. my thought is that, regarding the conflict, we absolutely have to treat this with a kind of reverence for human time -- despite the anger, it is a natural phenomenon. it is important we remember here that there is an historic significance of place in the middle east in the way the countries relate to one another going all the way back into history. i think there has been an exchange of trade and culture in the area. i really think the united states needs to take eight steps back and -- take a step back and understand and a separate way that everyone is affected. host: thank you for your call. we will leave the video now from the ipad, associate press video, it is available at yahoo and other places.

next is a call from minnesota. derek, independent line. caller: how are you? host: fine, thanks. caller: thank you for c-span2. it is fascinating to see all of this happening and see it spread. the united states should just let it happen. host: what are the risks and rewards for the united states if we just let it happen? caller: the risk for the united states, looking from a historical perspective, the way in which the united states interfered in countries like iran and iraq and the masses we had to clean up later, i think -- messes we had to clean up later, i think it is a chance to let the people around the world to determine their own destinies and to create future positive relationships with arab countries around the world and prevent things like terrorism from continuing to happen.

i think this is a pivotal moment potentially into the relationship between the united states and countries in the middle east. host: here is a story from the "no york post." thousands of protesters burned fires, threw molotov cocktails in the worst unrest in hosni mubarak's 30-year rule. this is a statement from hillary clinton, secretary of state -- we believe strongly the egyptian government has an important opportunity to implement political, economic, and social reforms in response to the legitimate needs and interests of the people. tennessee. james, a democrat. you are on the air. caller: those people over there, from everything i gathered, they

just want democracy. and the government is corrupt. the united states is sponsoring their government, more or less. they just want an equal chance at life. they have to be pretty -- to go in the streets and risk their lives. we have to realize these things, there are things going on there -- just like hear what the government. we should already have jobs and infrastructure. host: thank you for your call this morning. a viewer who called themselves dirty water writes this -- in the washington post, all of the newspapers, front-page story and many pages inside about the turmoil in the arab nations. yemen, here is a story --

amending the end of the government that ruled for more than three decades -- demanding the end of the government.

that is reporting from yemen. talking about what the united states should do, if anything, about arab protest now and three countries. james is a republican. good morning. caller: good morning. this looks like it could be quite an opportunity for the west if we handle it correctly. certainly in the past we have supported regimes, at the time -- is supported regimes. at the time our reasons were probably rational. we have to be careful about how we handle this. i suspect -- do not have enough knowledge about what is going on in these states.

i hope the state department will look very closely at this. i think a light hand is probably going to be necessary. but i look for this as an opportunity, and i certainly pray that it is. host: shris -- chrisnbama writes -- in "the washington post," here is what up front page story says --

next is a call from tulsa, mike, and independent. caller: i think the united states should stay out of this. this is an oppressive government on its people. and these people are fighting for freedom. also, i am a little ashamed of vice-president by an's support biden's's so put -- support of the government, the egyptian government. i heard comments on the news and basically he is supporting this government. these people have a right to protest, they have a right of freedom of speech.

this government essentially is a dictatorship, i would say almost on the verge of communism. and yet our government is making comments of support. it is not right. we should stay out of these people's affairs and let them decide on what type of government they want. host: our next comment, and then a who is a democrat watching from -- anthony who is watching from los angeles. caller: my opinion is, and the opinion of most people, is of the united states should not meddle in the affairs of egypt or yemen, but i think the united states will, because of the fact of the suez canal. the united states don't, i believe the europeans will. host: where does that leave us, anthony?

>> , that leaves us, the people of america, really with nothing to do -- caller: that leaves us, the people of america, really with nothing to do. we know the suez canal is of vital importance to the united states government. host: thank you for your call from los angeles. american hero tweets -- the front page of "the new york times" is filled with stories about this. olmert says he and of that were near a deal in 2008 -- he and abbas were near a deal in 2008.

you can read more from that in "the new york times." the lead story -- below that, a story about aljazeera and its role in this. galvanizes arab frustration.

below that, on the wikileaks cable show -- jonathan, you are on the air. caller: you know, american- backed, the emphasis on american cutback in countries because of the oppressive governments is unwarranted, in my opinion. i mean, we cannot snap our fingers and change the world. the world is full of all present government. we have to deal with what we have at hand. i think we should support moderate democratic forces the best we can. i think this is a great opportunity, a very troubling thing that is going on in the middle east. you talk about protest going on

in lebanon. i would hope it would spill over into iran. the people are becoming more affected by modernism and becoming more aware, more educated, and they are seeing their oppressors more clearly and they don't like a. i think it -- they don't like it. i think it is great what is happening and we should support the proper forces. there are people like the muslim brother heard -- brotherhood in the egypt that stance to take the reins and we should do everything we can to prevent something like that happening. because that would be tragic for the people of egypt and for us. host: "the new york times" story this morning -- we have been telling you that this is more economic and authority versus individual

rights. they have protested against rising prices and stagnant incomes -- next phone call is from boulder, max, democrat. caller: several things. first, the suez canal, it is in our best interest to deal with whoever will be taking over egypt. we have to deal with the people that we do not even know who is in the lead of these protests, so we definitely want to talk to

them if they do overthrow the government. this is almost indicative of what is going on in our country, is we are polarizing between democrats and republicans. growing up and becoming aware of my political beliefs, is when reagan in cited -- incited the people that the government is an enemy, those were treasonous words. that is why we of timothy mcveigh and protests -- have timothy mcveigh and protests and people killing their own congressman. this is downright atrocious. to get back to egypt, egypt has a ruler who has been there 30 years and he is probably a stick in the mud on policies and people want to will mobilize a more progressive -- in more

progressive and modern times. host: republican, you are on? caller: my god, did he use this as an opportunity to bash reagan? two words -- net neutrality. middle of december they passed a law -- let's see the big picture. net neutrality, shutting down social networking sites, the internet, that is where this government is going. the only way to get the word out is marginalize talk radio and fox and they will not be happy until that closes down. c-span, you will be the last man standing. i listen to your calls and i hear when you represent the conservative point of view, you get all sorts of calls. thank you, c-span, but you are a little bit biased but i understand the pressure you are under. thank you. goodbye. host: john from maryland.

referring to some pressure we are under -- not sure what. a news story from "the wall street journal" about algeria watching what is happening in the middle east. this is benoit faucon -- host: next is a buffalo call. george, a democrat. caller: we missed an opportunity when, first of all when iran was taken over and the shah was kicked out -- we refused to uphold our democratic values of the people in iran turned

against us and the islamic revolution started. obama missed a great opportunity. he is great but you see his weakness in foreign affairs. he missed a great opportunity. this wave across the middle east for started in iran. people were shot down in the street. the united states did not stand for its democratic values, in my opinion. the should have come out and say, we ought for the violence, we believe in democracy, we believe in democratic freedom -- we abhor the violence. this wave is unprecedented. the next place it may hit is saudi arabia. another dictatorship, another monarchy, people will held on to power all of these years. the internet is a great thing. facebook is a great social network. the young people -- remember, the middle east is full of -- basie the repression, they don't

have freedom, they have been told by religion -- religious zealots they cannot do this and that. they want freedom. they want what we have. we have the opportunity to say, listen, we believe in your freedom. but we should definitely voiced our opinion. anwar sadat was the former president of egypt before possible bart and he was gunned down. he was the leader of the people had hoped -- he was the former president before hosni mubarak and was gunned down. we have embassies and all of the countries -- in all of these countries. host: thank you very much. george is one of several callers mentioning the power of the internet. the first tory we read this morning -- internet and data services were cut throughout egypt today as the protests mounted after the prayer services at noon. next is a call from long beach,

california. mark is a republican. caller: if you did not know what pressure you are under, let me help you out. mobile calls this morning by mentally ill democrats -- multiple calls this morning by mentally ill democrat cleaning the war in iraq were the cause of terrorism or president reagan was the reason that timothy mcveigh blue up the oklahoma -- this is proof that democrats are mentally ill. this is a sickness. i agree with them in one point, and that is the biggest threat to america it is not these terrorists. they are the second biggest threat. the biggest threat are these mentally ill democrats. it is crazy to talk about -- this guy who got off the phone -- anwar sadat was murdered by a muslim terrorist because he made peace with israel. timothy mcveigh had nothing to

do what ronald reagan. the wars in iraq and afghanistan were responses to terrorist attacks. matter of fact, the history of the united states, the marine corps was formed in the 1800's because muslim terrorist pirates were murdering american citizens on the high seas. the idea that america is the cause of muslim terrorism is in st. -- in st.. liberalism is a mental disorder, it is not a political philosophy. host: are you finished? ok. thank you from long beach, california. knoxville, tennessee. tommy is a democrat. caller: i believe the u.s. stay away -- for so long we flex our muscles around the world -- flexed arm muscles around the

world, trying to bait the mediator of everything that goes on in the world -- trying to be the mediator of everything that goes on in the world. a political bully that decides how things should be run in other places. we should be focusing on the things that we have here in the u.s. ourselves that we need to pay more attention to. i believe in the long scheme of things, it all comes down to money and where we can try to get an advantage in other places, achieving our own goals, that we are trying -- these bullies and democracy is not something that everyone wants. i believe what is going on right now is the people are unhappy with their voice is not being

heard. host: from "the wall street journal" we are going to opinion pieces. ours. choice and here is what they write -- here is how they close -- lancaster, pennsylvania. john, independent. you are on.

caller: that was very good, from my point of view. i guess i am a mentally ill independent. the united states has called a lot of these problems. they supported hosni mubarak for 30 years and they sent people over there to torture during the bush administration. this is -- what is the word -- backlash against the united states as well as those dictators. whether it is saudi arabia, syria or lebanon, israel, and egypt. the united states is in large part responsible because we give them billions of dollars a year to help repress those people who are revolting. host: thank you for your call. "the wall street journal" printed a piece on its opinion page from an egyptian blogger recently served a four-year prison sentence for views he expressed. here is some of what he writes

-- ottawa, canada, is next.

good morning. we are going to move on to redding, pennsylvania. josiah, republican. caller: i am a first-time caller. let's talk the blame game and we have to be civil and our debate. i am an african. i travel. i came to the united states in 1997. i am from the sierra leone. and we believe in democracy. america has been exploring this democracy. let's stop blaming america for spreading democracy to these nations and blaming the previous government of trying to create issues. case in point, before you cut me off. the former president was

working for the united nations and he went to the sierra leone and he was able to at least bring in democracy to sierra leone. currently functioning very well. that also spread to liberia. so, i believe obama should take this as an opportunity. he has to be very frank with him, making sure the peoples of voices are being heard. el-baradei was an inspector for the united nations. they have seen democracy and they are going they're making sure the people's voice is being heard. let's stop bashing people in the united states and let's start supporting democracy in these

third-world nations. host: from wikipedia, the populations. total arab league, 348 million. egypt is the largest, sudan is next. algeria, 34 million. iraq, 30. yemen, 23 million. syria, 21, and then tunisia, 10 million people. detroit, the morning to you. this is roger, a democrat. caller: i think that we need to support the people and their protests. host: in what way do we support them? caller: i really think we need to show what is going on over there with an unbiased view. the reason why we need to do that is simply so, one, if we support them without taking

political science -- when we take -- without taking political sides because when we take political sides it looks like we are propping up governments to support our agenda which always comes back to backfire. oftentimes, we directly ignore some of the people. yes, the danger is, yes, we can get a radical group coming into power like hezbollah becoming a political group. you know, that is unfortunately -- that could happen in a democracy unfortunately. and if they don't want democracy, let's not force it on them. let's support whatever of the people want and let them grow on their own terms politically.

host: a viewer on twitter -- another detroit call. mark, a republican. caller: i just believed that we need to stop spreading our democracy by interfering militarily but these arab nations. we are spending all of this money in the arab world, billions of dollars to bomb our democracy into people. these people need to govern their own countries. they need to handle their own problems. the united states, we have enough problems here. i think democracy, with the young generation, will be handled on its own. we can mediate but by forcing military intervention for our own agenda as -- agendas is

totally wrong. we need to mediate with these people on a different level. we have been spending millions of dollars, billions of dollars, on afghanistan and these wars we are going through and it is to no end. we need to let these people handle their own affairs and we need to mediate with the arab world. host: thank you for your call. anthony cordesman was written extensively on security and economic reforms in the middle east has this piece in "the financial times."

he writes -- next is teach -- houston, independent. you are on the air. caller: how were you? thank you for c-span. host: thank you for watching. caller: while we were sleeping, that means over the past 50 years, while we are sleeping, now there is a new, what you may call a heightened awareness among the people all over the world. while we were sleeping, these governments were put in place and supported by our own government to further advance

american business interests in these countries. and democracy is a joke. our understanding of it is not the way it is being distributed across the world. these people are waking up. they are tired of being oppressed. the only thing that keeps us compressed over here is the two- party system where neighbors hate each other, calling each other democratic not spirit -- nuts. you dehumanize them and allow other people to do the same thing to each other, our neighbors here, that jared loughner did, walked up and stuck a gun into somebody's head. that is a form of control to keep the two-party system over here, so we can never get along. so how can we point -- point the finger to anybody else? host: someone watching the news

on bbc sends us this tweet -- "the washington post" opinion page has two pieces on this. here is what they write -- they also have david ignatius, foreign-policy columnist. we will look at that after this call from california. liz, republican. caller: you just took the words right out of my mouth. as far as the billions of

dollars i am sure we are sending to all of these countries, billions, and now we are broke. let's face it. i know our beloved secretary of state announced $15 billion -- please to announce sending $15 billion to palestine. why can't the rich muslim countries in the middle east send money to palestine? why do we have to send it when they hit us? -- hate us. maybe this is a wake-up call for us. i don't think we should interfere, that is just my opinion. when we interfered and opposed the shot of iran, you see what we got in return -- shah of iran. host: we have a live picture from aljazeera on the screen. finish your thought, please.

caller: i thank you for the opportunity to give it. we have been sending billions of there. host: thank you. let's move to a call from chicago. keith, independent. caller: thank you for taking my call. one of the things i believe is we should ask why we have been propping up these dictatorships. nothing exists in a vacuum. we are worried that once these dictatorships fall into that vacuum, the arab brotherhood. i did not think the people take in the streets will be organized enough to stop the rise of islamic brotherhood. i think we are up against some things that we can't control. you have the extreme population explosion, you have the dwindling resources.

you have for decades the education system in shambles. this has bred the possibility of having religious extremism get a foothold, because what they have is absolute commitment to going forth and establishing themselves. so, i think there is a very good chance the new model we will see will be something like pakistan or somalia where extremists are getting in there. because there has not been anything to deal with the economic hardships over the decades, that unfortunately is going to be a new model as we saw in iran. and that could continue for decades. i think our problems are just darling. host: not much time here as we wrap up the discussion. we will have another session of open votes -- phones at the end

of the program. chris on twitter writes -- we have the cairo bureau chief of the associated press on the line with us. thank you for being with us. tell us please for those watching here in the united states what you are seeing today. guest: we are seeing 10,000 of egyptians taken to the streets in cairo and elsewhere demanding the ouster of president hosni mubarak. in cairo the protesters are continuing to converge at the heart of the city but the police have so far succeeded in preventing the protesters from getting to the square. tear-gas, warble once -- robert bullets and water cannons. that had -- former head of the

nuclear -- u.n. nuclear watchdog is stuck at a mosque. host: what is the net effect of cellphone services and internet services being cut? guest: limiting communication between protesters. they have been using text messaging, twitter and facebook to organize and to help them in the cat and mouse game they are playing with riot police. this is possibly hampering the protestor somewhat. the protesters may have found an alternative way. host: what about the mubarak government? any signs they're interested in any concessions, listening to the voice of the people? guest: the biggest hit of a

concession was made by the secretary general of the ruling party. he said the ruling party was willing to open a dialogue with protesters, the political parties and the public in general. he followed up by saying democracy has its rules and a minority cannot impose its role of the majority, referring to the overwhelming victory achieved by the ruling party in elections in november and december, an election that is widely thought to have been . rred and rigged so far, no hint of major concerns -- concessions by the government or for reaching reforms to satisfy demands of the protesters. host: i know you are busy right now. up until this point, the protest had been described as secular, looking for economic reforms and

personal freedoms and democracy for individuals. i of wondering, we are hearing -- and wondering, we are hearing about the muslim brother heard, what does it tell us? guest: i will not go as far to say it has taken a religious tone but the muslim brotherhood has taken to the streets. the best organized opposition group in the country. they lent considerable weight to the protesters in terms of numbers. but this was begun in young men and women in their 20's and early 30's. but things are changing very, very quickly. today, yes, it is obvious the muslim brotherhood called for supporters to take part. the numbers are far greater than anything we have seen it since tuesday.

and the protests in cairo are far more spread. we are hearing reports of quite sizable protest in at least six other cities across the nation. host: thank you so much. we will continue to look for ap's reports. we are going to take a break. as i mentioned, in the final part of the program we will have the phone lines open. a lot of domestic stories as well. but if you want to continue watching the news and comment on the situation in egypt and other arab nations, there will be an opportunity to see that. the next sessions will turn to domestic and the economy. we will be right back. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]

>> no question, 9/11 redefined the presidency because it made it abundantly clear that my most important job was to protect the country. i met a lot of controversial decisions to do that, many of which i described in the book -- i made a lot of controversial decisions. if i had to do them over again, i would have done them again. >> former president george w. bush talks about his memoir " decision points) with students from southern methodist university. >> this weekend on american history tv on c-span 3, we will tour the home of social reporter, writer, statement, an ex slave, frederick douglass. and the naval diplomacy of federal -- president woodrow wilson. and a focus on daniel patrick moynihan, who -- who's career

before a senator several many administrations. c-span 3. see the complete schedule online at c-span.org/history or press the c-span alert button and have the schedule in mailed to you. >> this weekend on book tv on c- span2, almost 10 years after the attack on the world trade center and the pentagon, cnn's national security analyst peter bergen is interviewed by an author and columnist. also this weekend, william herzog and david eisenhower on the military industrial complex. and obama's first campaign for the illinois state senate. a complete schedule on booktv.org and sign up for our booktv alert.

host: there is a policy debate raging across the country and in this town as lawmakers and white house turned to the u.s. budget and the deficit, about the right approach, whether or not but the precarious economy weather got -- more investment is necessary or is it better to work on the deficit. matthew mitchell is at george mason university's mercatus center. guest: we are a research institute that focuses on the intersection of public policy through the economic plans and try to bridge the gap. host: politically on the spectrum? guest: i would say we are a market-oriented think tank. we do have a view that and a lot of ways market solutions tend to be superior solutions. host: and isabelle sawhill,

economic studies senior fellow at the brookings institution. i would start with you -- and interesting photograph of why obama loves reagan. you see a picture of the president and a former president together. i would like to ask you, how does this debate differ from the supply side debate versus the keynesian debate of the 1980's? guest: i think, by the way, one of the things obama shares with president reagan is they are both very upbeat, very optimistic. i thought the state of the union address was a very upbeat talk about how we can win the future if we did the right things. on economics, i think there really is a difference because supply side economics says all you need to do is make sure the economy has low tax rates and

very little regulation and let the market work and it will grow very rapidly. and there was a specific believe that if you cut taxes, it would actually bring in more revenue. i don't think any mainstream economists believes that is true, although tax cuts can have some impact on growth and have some revenue and facts -- effects. the other side, more keynesian side, says it is really important when you are in a downturn such that we have right now and unemployment is over 9%, to use government -- you use government to bring back jobs. you may need fiscal stimulus, you may need monetary policy. right now monetary policy is

about as stimulative as it could be and fiscal policy in is in this bind because we have these very large deficits, which makes it difficult to say we should do more. it is also political and possible -- politically impossible. host: you espouse what theory? guest: i would argue, as most conventional economists would these days, we should pay attention as we are in a downturn and not a good time to be cutting spending and raising taxes. you don't want to do that in the middle of a recession. on the other hand, you do want to have a fiscal plan going forward that shows that you can get your fiscal house in order. that will reassure financial markets and our creditors abroad that we know what we are doing

and prevent an increase in interest rates for a fall in the dollar from disrupting any recovery that may be incipient. host: matt mitchell, you were not around for the reagan administration, but let me ask you about how you viewed the problems the country has as different or the same as earlier periods in our recent history. guest: i think one thing i think is different is spending. if you look at what happened during the reagan and the station and really what happened with republicans in the decades that followed, it was a significant, only laser-like focus on taxes and taxes on the. while they did cut taxes, they never addressed spending and the share of the economy actually increased. bill clinton is one of the only presidents in the world war ii period as salt spending as a portion of the economy decrease. -- that saul spending as a

portion decrease. the people who are opposing the administration, i think for the first time in quite a while, are not focused as much on taxes as they are on the spending problem. to me, i think that is heartening a little bit because this obsession with cutting taxes and let spending continue at its previous paced i don't think makes a lot of economic sense. host: but the recession we are in, why do you call spending a problem? guest: for a number of reasons. the main reason is it that it drives two things we know that harms economic growth. if it is paid for with taxes, that can harm economic growth. there was a study by president obama's former economic adviser and her husband on that. if it is paid for with debt, when not excessive debt and deficit also harms economic growth -- we know excess of debt and deficits also harms economic growth.

it is in my view, unsustainable. not so much what is happening today -- as a share of the economy it is 25%. in the next five years it will grow another 10 percentage points, 50% in a number of decades. host: you see the same trajectory and are you concerned? guest: i do see the same church rectory and i am extremely concerned, but we should be clear about what it is due to. the aging of the population and the fact that health care costs per person in the u.s. are accelerating at a very rapid rate. that is basically what is in increasing spending as a proportion of the economy. right now, there is a temporary increase in spending because of the recession and the need to have unemployment insurance at some other programs that were part of the stimulus package. but that is a very short-term

thing. i think basically what i am concerned with -- and it sounds like what matt is concerned about -- is not what is going on right now. what we should really be worth about is what the fiscal situation looks like a decade from now, two decades from now, three decades from now. by about 24, just three programs -- social security, medicare, and medicaid -- by 2040, just reprogram skull will consume all the resources we have unless we -- just host: there are three ways to get in touch with us. you can tweet or send us an e- mail or give us a call. the phone lines are on your screen.

we are talking about the economy and the prescription for it and concerns for the future. all that on the table. r two guests have different prescriptions for how to address it. let's talk about the concern about the demographics, the programs and interest on debt which will consume so much of the gdp. >> i think it's a bell is right. in a lot of ways people in washington are eager to put a white hat on someone and a black hat on someone else and say it's the other side causing the problem. this may have a lot to do demographics and rising health- care costs. that is nothing that anybody has a firm grasp on how you can address rising health care costs. despite the demographics, there

is something you can do, which is take steps now while people have enough time to prepare and to accommodate by increasing their retirement age and indexing the cost of living adjustment, to change into cpi, which is the change in prices. take those steps to shore up the system now. i would add to the list of things that are causing this increase in spending. which is sort of the a exception that everybody in washington takes. most people in washington, most politicians admit there's a spending problem, but they make exceptions for one project or another. when you add up 535 exceptions, nobody wants to cut those particular projects, then you have a spending problem. >> what percentage of combined expenditures from home and security, defense, cia, includes securing the nation are in that?

>> isabel may have a better gas. i would say 20% or 30%. >> all defense + homeland's areurity would be around 17%. host: do you support the kind of reforms that mitchell suggested? guest: yes, but i would emphasize when we talk about raising the retirement or slowing the growth of benefits, we are not talking about affecting anyone who is retired right now, or is about to retire. we are talking about putting in place now and plan for the longer-term future that says to younger people today, you are going to get as least -- at least as much in benefits as the car degeneration. you are just not going to get as big an increase as you might have expected.

and we are going to encourage you to do some saving to make sure that you have enough resources when you retire. social security was never meant to be the only source of income for retirement. it was intended to be part of a three-legged stool. it was one leg and then another leg was attention from your employer. the third was your own personal savings. host: it was called supplemental security income at one time? guest: know, that targeted mostly the disadvantaged, a separate program. host: the social security suggests a wider net. guest: well, i think that is a problem. i think the american public b --need to understand it's not going to be the sole source of income for retirement.

for low-wage worker working his or her entire life and has a difficult time saving, i dig a case can be made that we can actually boost what they get in retirement a little bit from where it is now. the president's bipartisan fiscal commission recommended that although we slow the growth of benefits for the more affluent beneficiaries, we should absolutely increase benefits for those at the low end of the scale and we should also have an exception for those jobs where later retirement would be better difficult. manual jobs, for example. host: do you support the health care law and adjusting costs? think theon't health care law get the problem. it is interesting. there are claims the health care law brings down the deficit over the long run.

the truth in that is what the health care law does is it raises taxes, but it does nothing to decrease spending and does nothing as far as i can tell to lower the cost curve. i am not a health care expert, so i don't want to talk beyond my knowledge. there is not a lot that government can do other than remove the perverse incentives that intervention in the health- care market party has. host: the you believe the health care law will address spending concerns on health care? guest: i think it will do so modestly. there's a lot of uncertainty. the potentially -- it could potentially have a positive effect, but we don't really know. according to the congressional budget office, which is neutral, its will actually reduce costs somewhat and it will reduce the deficit.

it is a very difficult challenge to reduce health-care costs without affecting access. but we should be able to do it. this country as much higher health care cost per person than any other advanced nation by a wide margin. we don't get better health care as a result. so there is something fundamentally inefficient about the way we deliver health care. we don't get good value for the dollar. i think the bill is a good thing, but not perfect. host: say the doctor has been a guest at c-span many years, so its collaps -- so we are glad to have isabel sawhill at the table. she has spent her life at the brookings institute and pryor was a senior fellow at the urban institute. she's co-director for

families. and focused on domestic policy, federal fiscal policy and co- director of the center for children and families at the brookings institute and president of the national campaign to prevent teen pregnancy. matthew mitchell, this is your first time on c-span. >> it is. >> research fellow with state and local policies at george mason university's mercatus center. he has his ph.d. in economics from that school. a ps from arizona state university. thefirst-- a bs from arizona state. let's get to some calls for our two guests. beginning with norwalk, conn. tom, republican, on the line. caller: my question is obama keeps on pulling money out of the private sector through his policies and he keeps on adding

to the regulations of the private sector, of the business sector. if you pull money out of the private sector and give it to the public sector, you shrink the money in the private sector. and it keeps the job growth down or exacerbates this long unemployment that we are seeing. do you see anything changing in the hearts of obama in his policies since the election of the party candidates that will change his policy towards continuing raising taxes and regulation on the private sector? guest: i think in the state of the union address annual saw a very clear pivots of the president towards reaching out to the private sector.

in his appointment, also, he has signaled that he will work more closely with business groups in the future. -- his appointments. that suggests that he is very aware that government does not create jobs, only the private sector creates jobs. the government's role is to make the environment such that businesses will want to hire, will want to invest, will want to use some of their record profits. the private-sector is very flush with money right now. corporate profits are at record levels. the stock market is high. what is preventing businesses from investing and hiring is the fact that people are not buying what they have to sell. until we can get the unemployment rate down and get in comes of households but, you are not going to see a lot of hiring. for the longer-term, i do think

the things that the president is talking about such as a drop in the corporate tax rate, closing some corporate subsidies or eliminating some corporate subsidies, and reviewing regulations can help. i do not totally agree with your assessment that obama has been especially bad on pulling money out of the private-sector and regulating more than his predecessors. if you look at the data, in fact, the bush administration actually increased government spending more than any administration we have had since the second world war other than lbj, other than president host: johnson let's get a call from michigan, democrat. caller: good morning, c-span and susan. my question is as we investigate

trade agreements that have been devastating to our job markets in the states. i think that would have an impact on the employment, either that or looking at these countries that flood our markets. host: what do you think of trade and its effect on the state of our economy? guest: there's a remarkable degree of agreement among economists on this. my view is that of adam smith, that trade is beneficial for every party, really. artificial barriers to trade cause more harm than good. if the government says i cannot buy a product from somebody because they live in another country, that does mean harm because it raises the prices of

my goods and services. the harm that it does for me outweighs whatever benefits of bestowed upon the producers in the u.s. i would argue that there's a dynamic effect where it harms the producer in the long run because it makes them less competitive. the auto industry in the u.s. benefited from intervention on trade policy for decades. over the long run it makes them less competitive and less appealing to consumers. host: there's a great deal of popular sentiment that suggests otherwise. people often say it field trade agreements have decimated our manufacturing base. guest: manufacturing is going down in just about every country in the world. the reason is the economy is changing. the service sectors are improving. this is thinking turn. this is what happens in an economy, it's very painful for those going through it.

i would argue that it becomes much more painful when government policy shelters people from the fundamental changes that are happening in the economy. host: when naphtha -- nafta was being sold to the public, we heard there would be displacement. they spoke about the need to retrain our work force. was there enough of that done in this country? guest: i am not sure there was enough. i agree with what matt said in general, but what we need to remember is that there are groups of workers that are going to be very much hurt in the short run. if all of us benefit from trade, as he argues, but some group is harmed, then we ought to have in place retraining programs and other ways of helping those having to adjust to these very painful changes. i think that the training

programs that we have in this country are not terribly good. look at germany. germany is doing extraordinarily well economically, despite all of the financial crisis and everything that we have seen around the world lately. one of the reasons germany does so well is because germany begins to train their workers at a young age. they train them very well. they have partnerships with business to do that. they have apprenticeships. we could probably benefit from restructuring our training programs. and using community colleges more for this purpose. host: next call from tennessee, california, a republican. caller: thanks for taking my call. ronald reagan when he cut taxes at that time the rate was 70% so

it really expert more economic growth. they got more money in their pockets. the president had a good speech. st. that there's gonna to be a freeze is not enough. we need a 20% across the board, including closing the department of allocation. and health benefits to the epa. and federal workers should get a 20% cut across the board. too much t regulation. i'm a businessman and it's almost impossible to do business anymore. caller: thanks for the call. some interesting points. one thing that is interesting is obama has this portion in his speech which is absolutely right on. he says that we cannot address

our long-term problems without lowering spending and without the loring spending in areas that people do not want to address. these are the entitlement programs like medicare, medicaid, social security. it was about 1.9% of the entire speech. he never followed up with a realistic plan for addressing that. i still got him for saying this is a problem. what i would like to see is some leadership that says this is what we are going to do to get spending under control. with regard to the short-term, 20% cuts, i am one of those that thinks if you give a politician a reason not to cut and make the tough decisions, they are going to run with it and choose not to make the cuts. on the other hand, the biggest problem is projected spending increases. we have to figure out how to get the projected spending increases under control. there's no better time to start

than now because it gets more and more difficult mathematically to deal with it as time goes on. host: the caller gave us three points. guest: there's a lot to cover. we spoke about the reagan tax cuts earlier. the caller mentioned them as well. they were put forward with the supply side rationale, but they were really keynesian tax cuts because we were in a recession in 1980, a very deep recession. those tax cuts helped us to get out of that recession. ronald reagan then raised taxes in 1982. then subsequently several other years in the 1980's raised taxes. so that was basically keynesian tax cuts designed to get us out of recession, not to help long- term growth. the president in his state of the union said that the freeze was not going to be enough and

then went on to talk about some of the big entitlement programs and revenues. i just want to get on the table that if we were to allow the temporary tax cuts that are going to last two years now that were enacted in december, including income taxes that we all benefit from and that were extended for middle-class and wealthy, if we were to let those tax cuts expire, that would solve a lot of the deficit problem that we face. that would not be the only solution, but it should be part of the solution. we have already set a lot about regulations. host: here's a clip from congressman paul ryan in his response to the state of the union address. let's listen. >> instead of restoring the fundamentals of economic growth, he engaged in a stimulus spending spree. not only failed to deliver on its promise to create jobs, but also plunged us even deeper into debt.

the facts are clear. since taking office, president obama has signed into law spending increases of nearly 25% for domestic government agencies and 84% increases when you include the failed stimulus. all of this new government spending was billed as investment. after two years the and and plummets rate remains above 9%. government has had $3 trillion added to the debt. host: i want to start with our guests. you said the stimulus program was important and necessary at the time and a job creation- focused. why is their unemployment rate still where it is with the stimulus package? guest: there are many good economic studies that suggest that if we had not done what we did, the unemployment rate instead of being a little over 9%, might be 12% now. so i believe those studies. second, i think that -- i

misspoke a moment ago when i said that the largest increases in spending had occurred under bush. because i have to acknowledge that as a result of the recession and of the stimulus package that was enacted when the current president first took office, spending. has spending. but you cannot blame the president for a really bad economy. the financial crisis began during the bush administration. the bailout was a bipartisan bailout of the financial sector. the stimulus package that was passed in 2009 was intended to help get the economy back on its feet again. i believe that without that, we would have had much more severe.. host: did the stimulus work?

guest: i am more skeptical. the administration made estimates initially that without the passage of the stimulus, and employment would reach 9%. in reality, with the passage of the stimulus, it was at 10% and its state around that level for a very long time. what is interesting is that if you actually read the literature on this, the language in the journal is nowhere near the language that comes out of washington. there's a ton of disagreement about the effectiveness of fiscal policy and stability of fiscal policy. when all of that is condensed in the process and put into the language of politicians, it comes out as stimulus works. i am skeptical. host: a twitter fall or would

like to a lightning round and whether use a good or bad to the following things. -- twitter follower. free trade > guest: good. >> trade unions? guest: good. guest: good. minimum wage? guest: good. host: legal immigration? guest: i cannot speak in favor of illegal immigration. host: high or low taxes? guest: low.

host: houston, brian you are on the air on our independent line. caller: i have a question for one of your guests. the first is for isabel. you cut medicaid and medicare when it's already $125 billion in debt. and for matthew, we already had a stimulus package which was almost $1 trillion. he spoke of infrastructure spending on that as well. now where did our money go? how much money is left of? of thank you. we start with you. guest: a lot has focused on how much bang you get for the buck. the estimates are all over the board. a number of studies found it is much lower than the administration thinks it is.

another aspect of research is focused on what is the multiplier multiplying. there's a new study from stanford economist john taylor that looks like this -- looks at this. all the extra government spending in many ways did not lead to increased government purchases. it ended up financing and at the state level, it allowed state governments to cover their deficits. basically, what you see is people are not going out and consuming and spending, which according to keynesian would lead to an increase in the economy and employment. instead they're using it to pay down long-term debt. guest: i am not sure i understood your question. i heard you say how can we cut medicare and medicaid when we already have a large debt? host: that's when i heard. guest: i don't know why we should not over time be reining

in health-care costs, which includes medicare and medicaid, precisely because we do have a large debt. the whole point is that they are contributing -- the growth of those two programs are contributing a great deal to the accumulation of debt and deficits. therefore, we do need to get them under control for exactly that reason. host: now to the social security comments. she writes social security does not contribute to the current deficit. guest: that is technically correct. if you believe in this notion that there is money in a trust fund that can be used to pay future benefits. but keep in mind that that so- called money that is in the trust fund is not really money. it is not real assets. it is just paper iou's. there is kind of an accounting

mechanism between the social third security trust funds and the rest of government. social security is receiving less money than it is paying out in benefits. it needs to draw on other resources to pay those benefits. that is what concerns me. if we begin to do something about this now, we could give people lots of advance warning. it would not have to be very painful. if we wait until 2036 -- 2037, rather. i think i have the date wrong. guest: i think it's 2038. guest: anyway, we will have an effect of falling off the cliff. host: on twitter, they want

clarification. would you explain the term "cash negative? guest: the amount of money that is collected in payroll taxes and these are the taxes that just about everyone pays, the employers and the employees, it is less than the amount that we send out in social security checks this year. host: now to annapolis, jim,., caller: nobody mentions the two wars and tax breaks for the rich and pop up budgets in the military. only taking 5% from the military and talking about security. didn't we over-pay for that under ronald reagan to fix this problem? host: when the president

proposed his five-year freeze in spending, did it include military? guest:no, it did not, but secretary gates and president obama have talked about making some hefty cuts in the military budget. so i think you are going to see some scaling back of military expenditures. obviously, the two wars are something that were started in the previous. previous they were not paid for. for the first time in history we have put the fighting of two wars on the national credit card. that is not a good thing. i agree with the crux of your question which is whether we ought to scrub the defense budget/ it is not half of what we need,

but it is a significant chunk of what we spend and should be looked at. quite a lot of republicans in congress right now do not want to cut defense at all. they want to fence that off and are not willing to talk about the big entitlement programs that we have been discussing. that leaves this very small sliver of the budget that is maybe 15% of all the money we spent, to take all of the cuts. and that creates a very difficult and not sensible situation. host: this question on twitter deals with state budgets. guest: she is right about the pension programs. pension obligations, according to the states, are under-funded

by 1.5 trillion or maybe one trillion. when you actually use of proper discount and account for its in a way that's more economically sound, they are underfunded by about $3 trillion. it's a big pension problem. one of the things we have seen thing is they have increasingly relied on skipping their pension payments in order to balance the books. in virginia this last year they skipped their pension payment as a way to balance the books. that undermines or exacerbates an already difficult problem. host: there's a comment from sasha in new jersey. guest: if you make an unsustainable promise to someone, you are not doing them any favors the long run. i would much rather tell my baby daughter that you are not likely to see as big a social security check as i saw, so you should get ready for it now.

that's a much more compassionate approach than to say it's going to be there and you don't need to save, you will be fine. host: let me ask about the fiscal woes of the state. there are discussions about whether it's possible to change alonso the states can declare bankruptcy. thus cutting some of their pension obligations and other iou's that they have. i want to ask about your concerns on state fiscal woes and their cascading effect on the economy, a larger u.s. economy. guest: it is a very serious issue. states, almost all of them, are required to balance their budgets. their revenues plummet, which they have done as a result of the procession, and their deficits go up, so they have to take these hard steps that we have been talking about. the federal government has been

unwilling to take them. they will have to lay people off and cut spending. that will exacerbate the economic problems we face. so right now the economy is growing at a modest pace. most of the forecasts are for growth rate of maybe 3%. but we have to grow at about 2.5% just to keep steady with the growth of the labor force. we have to grow a lot faster if we want to dip into this pool of unemployed people. the fact that states are cutting back on their spending and laying people off is just going to make it much harder to get out of the hole that we are in economically. host: we are having a discussion about the economy with two economists from different perspectives. matthew mitchell is based at george mason university's mercatus center. isabel sawhill is at brookings institute. the next call is from connecticut. this is charles, a caller: republican good morning.

this is perhaps not germane, but it is something that has aggravated me for ages. i would like to have the government refer not to a budget, because as i understand it, when most families figure a budget, at the top of the page they put down what their income is, then they list all things they will have to spend money on such as food and rent and mortgage and transportation and so forth. if that number comes out bigger than the number of the top of the page, they go back and cut down on other things. the government does not seem to work that way. i would like to know if from now on, can we refer to it as the government's expense account? guest: i will start and say i like your idea in general and i think the government does need to learn to live within its

means, which is really what you are talking about. we had a lot of problems back in 2008 leading up to where we are now because a lot of people were living beyond their means. we had access indebtedness in the household sector. people passing out their credit cards, people refinancing their mortgages. and then we had the credit bubble and it created a lot of the problems that led to the current recession. when the government does the same thing, think about it this way, there's not a coin to be anyone to bail out the government if it cannot pay its bills. so, this is one reason why many of us, including me, are very concerned about the fiscal situation that we face and why we hope the president will take

leadership and the congress will follow and there will be a bipartisan willingness to tackle this problem so that we can get our expenditures in line with revenues. whether you do that by cutting spending or raising taxes, the point is we should live within our means. host: let me put two pieces of informational on the screen. this is from a conservative policy group in the house of representatives, their proposal to cut federal spending over 10 years includes freezing non dispens -- non-defense funding. let's listen to the president by contrast the day after the state

of the union when he traveled to wisconsin to talk about investing in infrastructure. >> we have to be more productive, more capable, more skilled than any workers on earth. it means making sure our infrastructure can meet the demands of the 21st century. rebuilding our crumbling roads and bridges, connecting americans and american people with high-speed rail and internet. it means doing what we try to do in our own lives, like taking responsibility for our deficit, by cutting wasteful and excessive spending wherever we find it. and it means reforming the way our government does business so that it is responsive to the needs of americans. instead of being responsive to the needs of lobbyists. host: matthew mitchell, is the president, although acknowledging the need a voice

all spending and reforming government, talks about investment. whereas the republicans suggested cutting. guest: this is emblematic of the problem. on one hand you see even the most aggressive republican proposal starts out with cutting spending in non-defense, non- homeland's security, non- veterans, then they go on to talk about spending. paul ryan is the exception, but most republicans have not come forward with a very realistic way to address long-term entitlement. that is the republican side. on the democrat side, the president says many of the right things, we need to address the spending problem, spending is a significant issue, but then he makes his exceptions. for him the exception is infrastructure spending and investment in innovation and things like that. what serious spending reform involves is everybody being

willing to take sacrifices. my favorite program is going to get cut, but that's ok. guest: i would pretty much endorse what matt just said. the problem is lack of specifics. everybody can talk the talk. we need people to walk the walk. furthermore, if we need them to walk together. we need a bipartisan agreement that we are going to do the tough things. right now politically nobody wants to go first. nobody wants to jump off the ship into the cold water and pay the political price for having done so. and so, each side is waiting for the other to move first. host: we had bipartisan deficit commission whose job was. to do was guest: i think they did their job extremely well and i am very impressed with the bipartisan commission report. they put lots of good ideas on

the table. the president in his state of the union said that he commanded the group. he said he did not agree with all of it, but he thought it was a start. so that's good. the bad news is that so far he has not come forward with a very specific proposal. we will see what he does in his budget, which will be submitted in mid february. host: i read that one senator suggested that the report of the commission should be put to a legislative vote up or down. guest: yes, that kind of proposal is exactly what would be very helpful. look at the 1986 tax reform, this was regarded as one of the better tax reforms. they eliminated a lot of tax exemptions, loopholes, deductions, credits if that were hidden spending. and they lowered rates. this is something that everybody's ox was gored.

it was a shared sacrifice and it worked. guest: it is very important. i don't think most people realize that right now there's $1 trillion every year in backdoor spending through the tax code. if we want to get spending under control, we should not just look at programs. we should look at all the special benefits that flow through the tax system to corporations and individuals, which make the economy less competitive, more inefficient, actually benefits people at the top of the income scale more than at the bottom. the president's commission focused heavily on the need to do tax reform as we did in 1986. that could be the higher priority in my view. we could also simplify the tax system, which the average household would like. host: we have a sweet -- tweet.

guest: i am absolutely. guest: i cannot. host: paul on our independent line. caller: i have a two college degrees, one in engineering and another in business. i have been in manufacturing 30 years. i listened to mr. mitchell. he said manufacturing jobs are decreasing all over the world. these people who talk about manufacturing jobs, they don't know what they are talking about. the first thing, there is no amount of training, there is no amount of equipment that we can buy and manufacture, the only

difference is the labor cost. that's it. manufacturing jobs have moved overseas to china and vietnam and other countries. there's nothing we can do about it. manufacturing is where the money is. that is where you gave the money. that's the main reason our economy is down. until they cut down on these trade policies, we will be a declining country. that is the bottom line. if you look at where the economy was 100 years ago and if you talk with the typical american, they would say the backbone of this economy is farming. nearly everyone was a farmer. if you were not, you'll farmer -- you knew a farmer. then people will go into manufacturing. now you see this shift again from manufacturing into service industries and other types of

industries that for the most part people are looking past other types of skills rather than using their backs. this is a sort of necessary fact of life. there's not much we can do about that. what i would say is the best thing we can do is to make sure the transition is least painful as possible. policies that attempt to cushion people from this change actually end up doing more harm than good. for the last several decades we have seen subsidies and tariffs and quotas and all sorts of policies that favor the automobile industry in detroit. as they did that, what it did was its sheltered detroit from the rigors of competition. it added costs to detroit vehicles. in the and what we found is that

detroit cannot compete with that model, cannot compete with other countries. basically detroit was in a recession 10 years before the rest of us. i would argue a lot of that is due to the un-competitive special favors that were given to those industries. host: >> do you share that view? guest: to some extent. one of the reasons that cars and other manufacturers are not competitive is we have a unique health care system in this country that is employer-based. one of the reasons that labor costs are high in the u.s. and relative to some of our competitors is because private employers are expected to cover health-care costs whereas in other countries they are covered by the government. host: houston, republican line, dick. caller: thank you, susan.

i heard about germany. determining and japan. the first thing hitler did was he issued money with no interest and started on a german highway. president obama tried to get our infrastructure worked out. had that money been spent, we would have something to show for it. we have something to show for its with gm. people used to work on farms and people used to make their own shirts and shoes and clocks and stuff like that. you can do it again, america. take your money and invest and sell to your neighbors. the president has spent $3 trillion up to a $5 trillion. what happens to the money that

disappeared after 9/11, the $2 trillion and the $12 billion that disappeared in iraq and iran? guest: thanks for the call. one of the things i think you were saying that i would very much agree with is that we cannot look to the government to do everything. as individuals we have a history of being quite self-sufficient. right now when times are tough i think it is quite amazing how americans have really not been complaining much and have been trying to help their neighbors and trying to make do with what they have. and i did the president actually talked about that a lot when he gave his speech in tucson and said that there had been a lot of individual heroes who have come to the rescue of a congresswoman who was shot, and

in this time of economic difficulty 1 dingbat can help is if we are all part of this -- one thing that can help is if we all take part. if we improve our education system, that does not just mean the government doing stuff in the education world, it means, as the president says, parents turning off the tv, parents encouraging their children to do well in school. it means state and local communities taking responsibility for this because education is overwhelmingly a local responsibility in this country. so those are my thoughts. host: i want to go to the point that he made about infrastructure spending earlier. he said president obama was laughed off when he suggested that we spend on infrastructure.

how much of the stimulus package was directed to infrastructure spending? guest: i don't know the figures. i would guess about one-third of it. i guess a third was slated for that. what i would say is that there may be a role for government to provide some infrastructure particularly for types of goods that are public goods, goods that it's difficult for the private sector to find a profitable way to provide. some models for that are changing. things are far more reasonable than they used to be. we should consider those options as well. if those kinds of decisions should be made based on the merits of whether it makes sense to do -- to invest in these products. will the product create more value than it costs? i don't see infrastructure spending as a means to have your cake and eat it. we are going to build the roads and create jobs and save the economy. host: here's a file clerk

listening to your discussion about coeducation and asking what we should be educated to do. and related to that, this caller makes a suggestion that there are many unemployed college graduates on the street and we don't need more. guest: i would disagree that we don't need more. this is a temporary situation. i hope it's a temporary situation that we have high unemployment. people coming out of college right now are having a hard time finding jobs, that's true. but it is not the case that we are going to be able to compete long-term if we don't have a skilled and educated work force. host: our final phone call is from pennsylvania, vince, democrat. what's on your mind?

caller: good morning. in the early 1970's most insurance or rather health insurance companies were not for profit. i believe it was nixon that they changed the laws that encouraged the big companies to go for profit. as long as they have to pay out dividends and are on the stock exchange and also the high ceo costs and how much money they take out of the system, all of that money is being taken out of the health care system, doesn't that raise the cost of health care? if we made them all not for profits, would that not be a savings? thank you. host: some of the blue cross are operated as not-for-profit, aren't today? guest: i don't know about the structure of the health industry.

i am not a big fan of all the profits that the for-profit companies are having. i think that the new health care law is going to try to rein in how much money goes toward profits in overhead versus actual care of patients. but i am not sure that this is an area where we are going to reap a lot of savings. one thing that would help, there's a big controversy about this and i'm not sure how i feel about it and it's not consistent with our history and political culture here, but in europe they have much greater efficiency where they have a single payer systems. host: having shown the two differences in opinion, how will the next six months play out?

we're getting close to a presidential election. guest: it could play out the way it typically does which is politicians will kick the can down the road and we will see nobody wants to take a lead on this. the other way is it could work out a way that it has in other countries. in canada in the mid-1990s's they got serious about the gdp ratio, chronic government spending and high deficits. they cut $6 in spending for every $1 of revenue raised and they solved their problem. if you are able to tackle deficits with spending reductions as opposed to tax increases, it's much more likely to solve your problem. politicians that do that are more likely -- are just as likely to keep their jobs than the typical politician. so it would be good politics for the president. is it easier to get

that in a parliamentary form of government than ours? guest: yes, it is. host: thanks to both of our guests. nice to see you. we are going to take a break. our next segment we will continue the discussion about right sizing government. a professor of public service and an expert on the size of the federal workforce. we will speak with him about how big are federal employment structure is and what it means to rightsize expit. we will be right back. >> listen to historic c-spasupre

court cases. the court considers copyright and ownership. >> james reid was an independent contractor. he was going to create a commission. >> listen to the argument on c- span radio in washington d.c. act 90.1 and nationwide on ex-im radio and online at c-span radio. >> sunday, former minnesota governor. this past week he spoke at a politics events in bedford, new hampshire, part of a two-day visit to the state. kantor will host the first in the nation primary. tune into a c-span 2 "road to the white house"on sunday.

""washington journal" continues. host: you are looking at dr. paul light. he teaches public service and has an expertise in the federal work force. nice to see you again. thanks for being here. guest: nice to see you. host: over the course of the past year they have done research. i saw a number of different statistics. what is your best estimate of how many federal workers there are in the u.s. today? guest: we are dealing with estimates first of all. the contractor community will not tell us. they consider the number of workers to be proprietary information. every time we rolled out an estimate, they criticize it. i always say what is your estimate and they say they will not release that. i think that we might have 7 million or 8 million contractors

that work for the federal government. twothirds of which deliver services. everything from computer program to is the analysis and consulting and all the way down the hierarchy to security panda serving food in the federal cafeteria. we have a very large work force. we have another 3 million parent folks that get their paychecks in part from the federal government under grants. those are highway construction grants, which treatment facilities, construction grants, research at universities and so on. so let's put it at 10 million their perilous at the federal civil service about 2 million or 2.1 million. and add the military and now that 14 million. if you really want to go bare, throw in the number of state and local employees that work for the federal government under un- funded mandates. we don't know how many there

are, let's say that its 40 million or excuse me 4 million. now it's getting pretty large, almost as large as the manufacturing sector. federal employees are the tip of the iceberg. we don't talk much about freezing and reducing number of contractors. we cannot live without them. host: we will stay with that 14 number. you have statistics on how the federal work force has grown since 1999 when it was 11 million. that number is wrong on the bottom. 4.4 million contractors is correct. and 5.1 million contractors in 2002. those numbers keep going up. why do they keep going up? guest: because we keep buying labor from the private sector. we don't like to increase the number of federal employees, because it looks bad, looks back

to the american public. instead of increasing the number of civil service employees -- that has gone up under obama by 300,000, but its increase of lots under bush because there was heavy spending on defense and national security after 9/11. we bought a lot of stuff for the iraq war, build military bases that were exclusive. the procurement budget in washington has been going up and that's where you get the purchase of labor. two kurds of their procurement budget is for services, that means it is almost entirely labor. that is where these numbers really rise. host: let's involve the phone lines in the discussion about the size of the federal work force and what you as citizens think is appropriate. are you getting too much services from the federal government and are there too many people employed in the public workforce as opposed to the private sector?

the phone numbers are on the screen. in this segment we have already -- also added a line for federal workers. we will put that on the screen because we would like to hear your perspective from inside the federal bureaucracy as well. if we can put that on their id iair. we will get that on there as our conversation progresses, federal workers will have an opportunity to join us. let's get to some video. president obama in his state of the union on tuesday. >> we live and do business in the information age, but the last major reorganization of the government happened in the age of black-and-white tv. there are 12 different agencies that deal with exports. there are at least five different agencies that deal

with housing policy. then there is my favorite example. the interior department is in charge of families when they are in fresh water, but the commerce department handles them when they are in -- of salmon when they are in fresh water, but the commerce department handles them when they are in salt water. i understand it if the department handles them when they are smoked. [laughter and applause] we have made great strides in the last two years in using technology and getting rid of waste. veterans can download their electronic medical records with a click of the mouse. we're selling acres of office space that has not been used in years, and we will cut through red tape to get rid of more. but we need to think bigger. in the coming months, my administration will develop a proposal to merge, consolidate,

and reorganize the federal government in a way that best serves the goal of a more competitive america. host: before you answer, i would like to play an earlier clip, 1999, vice-president al gore. >> reinvention and reform is not a way to scale back our ambition or tighten our belts for its own sake of this sacrifice for a first principle. it is in fact a recognition of this fundamental truth, that we cannot chase our highest ideals unless they are grounded in workable, practical, responsible self-governance. we need governments that are as flexible, as dynamic, as focused on serving their customers as the best private companies around the world. we need to adopt the very best management techniques from the private sector to create

governments that are fully prepared for the challenges of the information age. host: the point being that administrations for many a decade have been talking about reorganizing, restructuring the federal government. yet the numbers we showed show that the numbers keep going up. what is the challenge here? guest: you know, al gore was right. george w. bush made an effort. richard nixon did. lyndon johnson did. every president in his office promises a better government, but it is quite hard to do. i was delighted that president obama mentioned reorganization the other night. great. about time he stepped into the conversation. but let's be serious about what a real overhaul of the federal government would mean. he talks about a real overhaul dating back to the 1950's, since the last one. my dad was an auto parts dealer. i have a couple of friends whose

parents were in auto parts. when somebody comes in for an overhaul, they're not talking about changing the spark plugs. they're talking about pulling the engine and doing a top-to- bottom job. the president is right to look at consolidation and overlap, but he has to expexpand the agenda. getting to some of the principles al gore listed, and getting to them hard through change. if he does not stepped up with his own big plan, the house republicans will be doing it, and that will be a lot more damaging to how well government works. host: let's go to florida. net, on the republican line. caller: i would like to make a comment about employees and salaries. the federal employees have ballooned up in terms of numbers. , federal employees

get about 60% more than the private sector. that is ridiculous. the private sector should be higher than the public employees. california, we are in trouble because of the fact that the federal employees, unions, and so on and so forth, are much more paid highly and their health care insurance is very high and expenses. so that is why they are in budgetary trouble now. host: dr. light, the caller is referring to examples we have all heard. statistics across the united states, how do public-sector salaries compared to private sector? guest: you have to be careful about the rule of averages. republicans have been saying the feds are more highly paid on average than the private

sector. that may be true, but there is a distribution in there. the feds are at the high-end with senior managers. but it turns out they are underpaid compared to the private sector. said that the middle and the bottom, there is a lot of variation in salary structure. people who are in favor of the current salary structure will tell you federal employees are more educated, more seasons, which is code word for older. -- more seasoned, which is code word for older. honestly, its a difficult comparison to make, and we have not been doing a good job of doing it. president obama opposed a salary freeze, republicans in the house have sniffed out the problem there. he did not impose a freeze on automatic pay increases due to time on the job. that has got to be part of it, i

am afraid. president obama will have to get on that as part of his reorganization plan. host: omaha, good morning. june, you are on the air with dr. light. caller: i am making $7.25 and can barely make it, and the post office people in omaha, nebraska, are making a lot more money. they get all these holidays off, paid, overtime for the weekends. they work as many hours as they can, but i would say that is the first place to start cutting down and freezing their pay. talk a little about the whole federal work force, not just about federal employees. let's talk about contractor employees and throw the grantees into the mix. if we are going to talk about downsizing, we have to include

the hidden workforce. i think if we did a job-to-job comparison between federal employees and contractors, we would find the contractors are spending a lot more on labor than the federal government. that is not to dismiss your concern in omaha about the difference between how much federal employees are making, and i think federal employees have to make a sacrifice right now. president obama made that point. you just cannot be raising salaries every year and allowing automatic pay increases due to time on the job during this period. federal employees have to sacrifice. contractors have to sacrifice. so do grantees. let's put it all on the table and impose a real hard freeze on federal salary increases, but let's include the whole work force, not just the one we can say. host: are the postal service

considered federal employees? guest: they are quasis. the postal service is a quasi- government organization that is supposed to run like a business. theoretically it is supposed to make a profit like amtrak. but it has one huge deficit. why? well, the post office, unlike federal express and ups, they have to deliver everywhere. they have no choice but to take the mail out to the rural post office, the rural post box. fedex does not go certain places. they get to pick and choose their certain destinations. most of their activity goes to major urban areas. part of the problem with the postal service is that it was built to serve every last american. i think we want them to do so, and they are running a huge deficit right now. we will have to do something to fix that agency. it has been downsizing for

years, which is a good thing, but it still has a long way to go. they are talking about eliminating saturday delivery. it is a good question that your caller raises, and we have to do something about the post office. has gotman darrell eisissa that on his agenda and we have to do something about it. host: our next caller is a federal worker in huntington, virginia. good morning. caller: you just addressed my specific job. i am a rural mail carrier in virginia. when i had to step chains on my vehicle, and go past areas with no guard rails where i could lose my life literally if i make move -- i wish

everyone was talking about salary cuts -- everyone who was talking about salary cuts would remember this. i do not remember anyone in congress talking about reducing their earned pay, the earned benefits, and most of them make a generous salary, people who are very wealthy. they pay on their capital gains a lower rate of income tax than i do for the most part. the thing i want to do is, everybody who talks about cutting these salaries is somebody who makes two, three, 10, 20 times the salary of the people who empty the garbage and carry the mail and make sure that the roads are being built with the sweat of their hands. let's start talking, when we predicate these discussions, with the people at the top taking the hit first as an

example since they are the so- called leaders. give me a response, please. guest: first of all, you're one of the reasons that the postal workers are the most popular federal employees there are. they really do get out there. they know their folks they are very popular and you sound like a great guy. i agree with you. on the basic premise. congress has a very good pension system. you are quite right about pay to members of congress. some of them did not need it. some of them actually do returned it, but it is a good point. i will also say that over in the executive branch we have 3000 senior executives who work for the president', either through or directconfirmation appointment, and we have been trying for decades to reduce that number to maybe 1000.

how many senior exist as the president really need? presidents have never liked this. they will swear that every last senior executive they have got is essential, but there is about a 25% vacancy rate. we have seen a bunch of obama appointments leave for investment banks the regulating, for investment houses, for lobbying firms. it is really a bad deal, and we ought to cut the number of senior executives. presidents never talk about it. the cuts are always directed at the bottom of government, not the middle and high levels. we ought to put the middle and high levels on the table and we ought to talk about increasing the number of jobs at the bottom of government, actually. we are really decimated down there, and one of the reasons we are having trouble in places like the food safety system with the recall is that we do not

have enough inspectors. let's move some of these jobs down to the bottom where the real goods and services get delivered. host: "the washington post" has a story on this topic today. by karen tumulty and and o'keefe.- and ed here is what they write. host: later on, senator susan collins is quoted about

reorganizing this, saying later on, a quote from caspar weinberger -- host: so the more things change, the more they stay the same, dr. light? guest: i loved president obama's joke about the salmon. i will tell you something, every salmon -- pacific, atlantic, salt water, fresh water, swims

to capitol hill. those programs start on capitol hill. the duplication and overlap comes from capitol hill. every salmon in the world seems to have a mom or dad on capitol hill. it would be shocking, but possible, that they all have names and are protected by district. so this start on capitol hill. you do not rationalize the committee structure, you are getting nowhere. i am telling you, consolidation and duplication -- that is one heavy, difficult list. we try it, we try it. homeland security is a good example of where it has not worked very well. it is going to be a slog unless obama ties that thing up in a big package of reforms. they get a little labor union buy-in, republican buy-in. we will not see much consolidation come out of this. it will be very difficult. i love him for trying, but he

needs to think bigger than consolidation and duplication if he is going to get this thing done. he has got that opportunity right now. he just needs to take advantage of it. host: both the president and the republican majority of the house were talking about cutting the size of government, the real size of government, and the challenges of reorganizing it. fayetteville, north carolina. battery, on the republican line, you're up next. asbury, on the republican line, you're up next. caller: personally when i have said that i do not like is the manipulation of the people simply to enrich the top 2%. money itself, if you take money, you cannot eat and wear them. you can use money to the point where they inflate them or whatever. but the point is, they control

the banks. it is nothing more than a separation between me and what i need to live, so i'm watching all these plants grow, all these people working, growing our food, having efficient housing and everything else. instead, we are following money instead of the actual thing we need to keep us alive. i just do not see this human experiment following money instead of following the resources. you take tarp. they should have went ahead and pay off all those people's loans off, and that way the bank could have gotten their money and the people could have gotten their houses. but every decision we have done has been to manipulate everything, to take out all the resources and put them back into those people's hands that are connected. it is like we just played your monopoly game and it is like,

what is the point of even playing games with you anymore? host: we go to eagle rock, missouri. june, a democrat. caller: i have one question. if everybody took, everybody that gets a government check, would take a 1% cut in their check, how much would that help the budget? i'm on social security, and i'm willing to pay for 1%. that is all i live on. but i'm willing to take 1% cut if they would take a 1% cut for everyone drawing a government paycheck. host: dr. light? guest: the social security and medicare, a huge part of the federal budget. i do not like the idea of cutting 1% from those programs.

people put in, they need to take out. the way to get to those costs is through bending the health cost curve. i'm not an expert in it. what i would like to see as a starter is a more aggressive overhaul of the federal government. that would send a message to the american public that we mean business about a lean government that can deliver on the promises we make. we have 1000 social security problems as the baby boomers begin to retire. we have to work on that. in the first year since the program began, we're spending more on social security than we are collecting taxes. that is a big problem. by 2037 we will have depleted the entire savings account, the trust fund that we built up over the years. at that point we will be talking about laying this on our children, laying this on our grandchildren. it is not right.

we will have to fix it, but we cannot do it overnight, and i do not think it is fair to ask americans who are dependent on social security to take that cut. i do not think that is right. but, you know, that is not my area of expertise. i have followed social security over the years. we have got a big problem there and we will not fix it with a one time, 1% cut. we'll have to raise the retirement age and deal with some of the tax and benefit issues, but that cannot be placed on current retirees. host: shirley, a retired government employee, you're on the air. caller: i met one of the field officers here in baltimore, maryland, and i am working in a field office on a program that if i had not come back to work,

this program would not have been able to have been worked on because they did not have enough employees to do it. the field offices to the retirement, disability claims, medicare, the need-based programs, after pay problems, and there are not enough employees in the offices to do the work. if anybody has ever come in an office and visited and see the number of people outside the door waiting to get in to be seen, the workers are interviewing all day. when do they get time to do the best work? when do they have time to process these claims? social security field offices is one of the offices of the french government, and i hope that they do not downsize because if they do, it is really going to be a problem. -- of the federal government, and i hope that they do not downsize because if they do, it is really going to be a problem.

host: is a different that when you were in the final government? caller: yes, it was cut in half. host: why did you take it? and guest: the only reason why they took me out is they said what can you do with that would benefit us? well, the program i'm working on is what i worked on when i was working at social security. so if i had said i do not know how to do anything except file folders, i am sure they would not have taken me. guest: in a very academic word, this is nuts. we do not have enough workers on the front lines of the federal government. the backlogs are growing in many agencies -- social security, the amount of time it takes to get a disability education at the veterans administration. what was interesting and ironic about the president of speech,

he said veterans can click on their health care records and csee them electronically. but it goes to paper. it goes to big old files that get passed around like they were 30, 50 years ago. we have not made much improvement on that. when you talk to the fed's about what they need to do their jobs well, they talked about double sided copying. what is that about? at the end of the day, we do not have enough people on the front lines to deliver services. there at the middle, at the top, in the contractor community. the american public knows that we are having one break down after another that its headline news. we have to redistribute capacity of the federal government down toward the bottom. that will save money because the upper level jobs are much more

expensive than lower-level jobs. i hate to criticize the senior and middle-level managers. they do a good job, important work, but when push comes to shove we need the workers on the front line. they manufactured goods and services that americans depend on. i think the obama administration, house republicans, democrats as well, need to take that up. what they're talking about now is freezing hiring. you know who that will hit? that will hit the front line of government, where the turnover rates are very, very high, unsustainably so. and if you say we're just not going to fill jobs, we will freeze hiring, you know what happens? the backlogs increase. the service degrade. -- the service degrades. we have to do much more than what we call a random shooting. we have to be deliberate about this overhaul and we have to be aggressive.

that is what is missing from the debate. host: maverick on twitter offers this -- host: for dr. light, no. no, michigan, nick, independent. you're on the air. caller: i was talking about the total compensation. listening to the purpose -- the person working on the post office -- i work for an electric utility company and i'm retired. we are working in all kinds of weather, and we've worry about falling off a road and getting killed. linemen just working with electrical wires. what they told us when it came to total compensation, our company came to be within 90% of the marketplace. that included hourly pay, fringe benefits, health care, vacation, and retirement. one thing i hear about a government retirement, state and

local, is that when they averaged the retirement, their income to calculate their retirement, is a three-year average. most private companies use a five-year average. so the five-year average has a lower income than the three- year. the government companies use the overtime they worked during those three years to be included. i do not know of any private company that includes overtime in a retirement population. the other question i would have is, what copayments to government workers pay for their health care? host: go-ahead, dr. light. he is finished. guest: when we talk about federal pay compared to private pay, we have to talk about a number of issues, and one is the total compensation package. health care, retirement, vacation benefits and so forth, and do a side-by-side comparison by job, not person in the job.

i do not want to get into the details of that one, but we ought to be taking a look at the total, package and being fair about it. just because the feds get a good health care plan does not mean we should cut it. maybe the answer is to make sure that every private employee in this country gets a good health care plan. just because the fed is getting a pension plan does not mean we should cut it. maybe we ought to assure that pension plans for private employees and state and local employees are properly funded. what we are seeing right now is state budgets collapsing like crazy. new york state justice over nassau county because their finances are -- just took over nassau county because their finances are coming apart. part of it is underfunding of the pension system. so you have to be careful about making these comparisons and asking what they mean. there are a lot of americans out there suffering right now, too many who are suffering, and they do not have health care, they do not have the compensation system

that the federal employees do, and many of the contractors do. but that does not mean we should cut federal compensation. it may mean that we make sure that everyone in america has access to the same. our caller is basically making us aware of that, and that is something to put on the table. host: what percentage of federal workers are members of unions? guest: e has been declining over the past five years or so. we are trying to come up with a figure -- i really do not know. 15% to 20% 80. guest: have the union's offer their -- 15% to 20%, maybe. host: have the unions offered

cuts? guest: i am quite supportive of the notion of pulling out jobs at the middle and the top. and driving those resources down to the bottom. a lot of union members are working really hard, trying to deliver these services and goods in a timely way. they do not get the resources they need. they do not get the help they need. i think unions can be brought into the conversation if they recognize that we can put more resources on the front line like our caller from baltimore who is dealing with the social security offices and those backlogs. but right now the unions are trying to figure out what their strategy is in the face of this coming out of capitol hill that says cut, cut, cut. and the obama administration again has not been responsive to it except for the tepid pay freeze that has more holes in it than swiss cheese. i think the administration has to be more aggressive.

host: c-span junkie tweets us -- bethesda, maryland, republican line, you are on the air. seato i feel there are pros and cons on each side. in my opinion, there definitely are some agencies that need to be cut. on the other hand, some agencies like the national institutes of health, is pretty well run. to say it is only lower-level workers you need, that is not true. but at the scientific discoveries that come out of the nih. there are a lot of radiologists in the private sector that make $500,000. you need to attract the best and smartest people unless you do

not want to do high-level stuff anymore. people if they work for the federal government, live in the d.c. area, which is extremely expensive. they are already taking major cuts by working for the government because maybe they really want to do research. but to go across the board and just freeze pay or say you do not need highly educated workers, it is the wrong premise. the down side is you will lose a lot of educated people that have a lot to offer. a lot of things go on here, and just to say that government is still really efficient and you do not need highly skilled workers, i think that is totally untrue. host: thank you. dr. light, your response? guest: she is right. that speaks to a deliberate approach of dealing with the

size of government. we cannot take the blunt ax to it, and it speaks to compensation variation by level. we ought to be paying doctors and researchers at nih more. maybe we pay others less. maybe we pay still others the same. you cannot wield the blood acts here. -- the blunt ax here. you have to be careful and serious about it, but you can get it done very congratulations on her work. that is an agency that should be inflated, and given the physical space it needs to do its job, there is more flooding out there, i am told, then there is around the potomac river. they need good space. as a resource question. host: dr. paul light, thank you so much for your time and expertise as this town debates the size, scope, and performance of the federal government, for research and contributions on this friday morning. thank you.

guest: my pleasure entirely. host: for our final half-hour, we will use it for open phones. we started out the morning talking about the protests in egypt, and we will show you some current video via al jazeera of the situation there. they're continuing to report, so if you have a cable or satellite system, you can watch the report. if you want to talk about that, we will listen to your comments, but we will hear from you on domestic policy as well. >> you are through with politics? define that. >> i do not want to campaign for candidates, be a money raiser. i do not want to be on talk shows giving my opinion, second- guessing, and i think it is bad for the country, quite frankly, to have a former president criticized his successor. it is tough enough to the president as it is without a former president undermining the

current president. plus, i do not want to do that. the fact that i'm now on tv, i do not want to be on tv. >> it is about over. >> it is. i tell people that one of the interesting -- sacrifice -- i do not think you sacrificed to run for president -- but for the extent you do, you lose your anonymity. i like trying to regain anonymity to a certain extent. being out of the press in this stage of the post-presidency is something that makes me very comfortable and is somewhat the breeding, frankly. >> "-- is somewhat liberating, frankly. >> "washington journal" continues. host: we have friday economic reports in.

host: also, an ap economics record -- -- writer --

host: next call, open phones, virginia. good morning to ken. caller: good morning to you all also, c-span3 i wanted to try to get in on dr. light, but i could not. and now i am on, and what i want to discuss was i do believe that as far as the federal government jobs and all, there are people that need jobs and we will have to do something about the amount of money that they get. i will explain to you about how your ex-president gets $200,000 a year. once you are a civil servant, your job is over with, i think you should be leveling off to a

standard citizen again with a certain amount of money that you get a year and you should have to live off of social security and medicare like some of the american people have to do to see if they can make it that way. but i still believe the cuts need to be, that they are getting too much money in the people should have to live off the wages that they get. host: thank you very much. next, a comment from lazard in michigan. good morning. caller: they say, they talk about the government. i wish the government would take cut pay for a yearly pay like everybody else. for example, the people who get in and have to leave life, it is amazing how the government growing up is double and triple paid. that is my concern with that.

the second when i want to tell you about the rioting in egypt, yemen, and whatever the other places that it is going on -- finally, the young generation sees what is going on. how is the life better everywhere like united states, the best country on earth. now they are waking up and looking at it, how they can have a better life. thank you very much. host: if you go to the front page of c-span.org, and today is the 25th anniversary of the challenger explosion in which seven astronauts, including the teacher in space, christa mcauliffe, lost their lives. there will be a memorial service today, and c-span will cover that. roanoke, virginia, maryann is up next. what is on europe wiyour mind t?

sika thank you for taking my call. good morning. caller: thank you for taking my call. good morning. you had the woman from brookings and the republican on. they both seemed to be really gung-ho for free trade. i really think americans should all know that in the last 10 years, even with those bush tax cuts, 45,000 companies -- not jobs, 45,000 companies -- have been outsourced. something is wrong when you have two people on there saying yes this has been great for america. no, it is not. take a look at every town across the united states. the only thing left are the multinational companies. that is all we have left. if we are going to get this country back, we certainly do not need other trade deals. that is insane for us to do any

trade deals until we get these trade deals fixed, the ones we already have. host: thank you, marianne. returning to the story from egypt, we told you earlier that -- we spoke to the ap bureau chief and learned that mohammed el ibarra de was in a mosque surrounded by security forces. he is now under house arrest. cadillac, michigan. rose is up next on our independent line. you're on the air. good morning. caller: yes, i am talking about my husband. when the big three auto makers were going bankrupt and had all these problems, the solution was from the people, you know, politicians, you are going to have to make choices. so they cut their pay, their health care. they even cut the amount of people. i think we need to stand up and

do this with the politicians. i think everybody is getting tired of the salaries for politicians. when i retire, i will live on $12,000 to $13,000 a year social security. they want to cut back? what is going on with the other countries and egypt? it is just the people. it is the blue shirts going against the white shirts. they are tired of politicians having it so good and the workers having it so bad. host: yesterday the white house announced a series of personnel changes. the most common and will be the new press spokesperson who will replace outgoing spokesperson robert gibbs, jay carney, who was at "time" magazine for a number of years.

you can see the story in the front section of "the washington times." we went back in our video library to look at him from years past, and here is one clip from him. >> the best press secretaries were very deft at serving both their boss, the president, the white house, the administration, and the press, and it is a tricky job. i am sure i would not be any good at it. but not this service in either side, embarrassing themselves, not having to go to the president and saying i just screwed up, frequently, hopefully, and not making themselves look like they're just spinning and not conveying information in front of the press. host: that was jay carney, who said, "i will not be very good at it, is a tricky job," who

will now be taking that job as press secretary, sitting next to joe clark part, who was press secretary during the clinton administration. next caller. caller: the one thing i do not hear anybody talking about is foreign aid. maybe going across the board and -- i will pick a number -- a 10% cut to everybody getting it. it is understandable they have to give some help. whatever they give out, that money should be spent back in the united states and not used by some other countries. one other quick thing would be marianne from west virginia with outsourcing. i am sure that everybody feels the same way about that. thank you. host: thanks, bill, from long island.

the senate okayed small reforms to filibuster and hold rules, but liberals sweeping changes are rebuffed. "mr. mcconnell was happy with the reforms, and the senate passed a resolution that will end the practice of reading aloud and the myth that a publicly available for three days, a move designed to save

time." ron, good morning, democrat line. caller: i wish i could have talked to the person on with social security. i have two questions. withployment so high and a the people that would be employed it if we had the situation before the crash, what is happening with the fact that probably somewhere between $30 billion and $40 billion a year is not being paid into social security because people are unemployed -- is that figured in when people figure out how long it will last? the second point i wanted to make, when you look at social security having $2 trillion in it tied up in bonds or whatever, the federal government owns basically trillions of dollars worth of assets, some of them which produce income -- by the tva in boulder dam, etc.

what if we let the bonds be run as a business and all the funds generated as income go into social security, which would change what social security is funded by? that's about all i can say, and i know you can really answer those questions, but it would be nice if somebody up next time talking about social security could talk about something like that. thank you very much. host: next up, pleasanton, california. caller: i have been watching c- span off and on, and all the papers and everything, nobody talks about the multibillion- dollars that we and everybody else pay for research and all that other stuff for cures for cancer and other health-care issues. with all the money that we spend on research and development and all that, it seems about every five years somebody will come

out with medicine that is a little bit better than it was before but nothing cures anything. can you imagine the money that would be saved if one of these research outfits would actually come up with a cure but they will not do it because everybody involved with that particular illness would lose a lot of money? that is what the big drive is on health care. the people at the top rating in with falsef dollars me advertising, that this bill was going to do this, this bill was going to do that, and all it does is prolonged illness. host: next up, texas, cliff, a republican. you're on. caller: thank you for taking my call. i retired from the state of california's department of consumer affairs. it just amazes me to hear some

of the conversation about cutting public employees' pay instead of creating some kind of inefficiency the way the agencies are run. just like on the federal level, why do we need a post office in every city throughout the whole country? one time that may have made sense. in california, it has over 200 public agencies, and each one of the public agencies as offices throughout the state that are leased from the private sector. if you had a state complex in the county seat of each county in the state of california, and the state owned the property, you could save billions of dollars and not cut services or pay from anybody. it is just amazing, and the culture in california with these

agencies is what is creating the problem, because once you get to a management level, it is all about -- there was more managers and staff, managers, staff in headquarters than there were in any of the field office throughout the state. they would take all the managers from the field offices and take them to the sheraton hotel in san diego once a month for this big party. as a person from a field office, i was a field office manager -- if you said anything in resistance to the way they were running the state, it was like you get your had taken off. host: "new york daily news" reports that john stewart has been tapped for the board of the 9/11 memorial.

host: ohio, our next caller. marion, independent, open funds. are you there? ok, we will move to altadena, democrat in california. guest: what about the people on social security? i only get $11,000 a year. my rent is $619, my electric

bill is $500. i got car insurance. if my disabled son does not live with me, i would be sleeping in the car. i'm not on food stamps, and they keep raising food, insurance, and the electric bill. and they cut me down where you do not get your $20 a year raise. how is a person supposed to live like that? host: from florida, living on social security. we have been talking a lot over the past few months over the possibility of states and localities and the fiscal crises and the possibility of default. here is one such story in the "new york post." state takes over red-faced nassau county. a state oversight board seized fiscal control of the financially beleaguered but extraordinarily wealthy county yesterday after deeming local officials in capable of

balancing their own budget. the daring move by the finance authority, only the second time the county finances have been overhauled by the state, effectively stripped now. wages of 8000 unionized employees have been frozen. good morning to peter, independent. you are on. caller: about the federal tax code. the idea of a straight sales tax -- has anybody consider the fact that there is a lot of money under the table that gets paid to people, that drug dealers and not pay income tax? instead of going to an income tax, we go to a big national sales tax -- it does not really matter where they get their money, they are going to pay the government. also, anybody making over $1 million a year should have to start paying a little bit extra.

5% for the first million, between $1 million, $2 million, 10%. this takes away the incentive for the people to say, well, i want $10 million, $15 million, $20 million. the less they will get for each succeeding million, the less likely they will get that money. we might see ballplayers salaries come down. thank you. host: if your reacted to our earlier discussion about cuts and wrote versus invest and grow. "you cannot cut and grow. it is not physically possible to grow an economy by cutting and slashing the budget. it was a because more corporate investment is what has always were to starkly to restore the american economy." south pointe, ohio, nancy on the

republican line. seat of the morning. i wrote a letter to president obama -- caller: good morning. i wrote a letter to president obama, and i could not believe it was read. i've got 18 different problems and they are trying to address me. well, back in 2009 my insurance that backdated. and i got dropped. when i got back on it this year, what did they do? they sent a letter, a statement, and now they want to finally address the disability. however, there are no polls in this. people are not aware. yes, you can get your insurance

back, but you may not be accepted. you can still get the night and be put on cobra, which is so expensive, we could not afford it. host: this is a result of the no pre-existing conditions change in the health care law? caller: exactly. there is some kind of a loophole in there where they can still deny you and make you take a higher, higher poll. i think it is like $900 a month or more. we cannot afford that. all this talk about democrats and republicans and all the stuff that they want to cut -- you know, i like sarah palin. i think that we ought to let her go in the whole white house and everything, take a broom, and sweep the whole place and start

from scratch and let's rebuild this economy. host: next up is john, watching in neptune beach, florida, independent line. good morning to you. caller: good morning. thank god for c-span. i think a lot of the problem would be resolved if we build our military bases, and they would use their own solar power and other things to create their own electricity. for the average home person, they say in five years you recoup the cost of solar panels or turbines, whatever you put up. then it is renewable after five years. just on our bases, if we would do something like that and use the hydrogen -- there is all

these solutions. it seems so easy when you sit here at home thinking of solutions. i cannot believe -- we need someone like lou gordon r. bill o'reilly -- for bill o'reilly to get on something like that. that would definitely in five years' pay for itself. host: it your rights -- -- a viewer writes -- and this fax from suit in new jersey -- host: the final phone call from

tampa. you are on the air, tampa. caller: i have been listening to your show. i think the big problem on this is that if you put all of our senators and congressmen and all of them on social security like we are, i think the problem would be fixed tomorrow, you know? because they are living fat up there and they have got all the benefits. i saw this show where they spend $500 for dessert, just for the maharajah of india. why do we have to cater to all these people, and we have so many people in our own country who are hurting, wasting our tax dollars and just going overboard? i think we need to cut their wages. they make too much money out there. they do not come down here