next month. at the same time, the sec is proposing new rules under don frank. i am hoping the treasury will have some enforcement responsibility. i have your alter or a i have carry for the last few sessions. >> we will follow that debate very closely. we share your interest to make sure these combat with a reasonable balance. we will watch that step carefully. you understand on the re- insurance side. we want there to be a level playing field for american companies. on tarp, when i came into office, the cbo estimate of this program would cost us $350 billion. we now believe that outside of

housing, these programs will show a positive return to the american taxpayer had a substantial amount because we ran a strategy that had private capital come in and bear the largest burden of trying to solve the crisis that we have been successful managing those investments. billions and billions of dollars in positive return from the bank investments will meet our long- term challenge is for these programs were incredibly successful in restructuring the automobile industry and we have a much stronger private financial situation because of the president's strategy. we will show a positive return outside house that is very substantial i think it will be the most substantial financial rescue in modern history even recognizing that we still face many challenges ahead in digging out of this crisis. >> as one who supported that

initiative, i would point out that legislation took place in october of 2008. we are grateful for your efforts to make sure the initiative worked, i understand it was proposed by the previous administration is one of those instances in the house of representatives or moderate democrats and moderate republicans cast the correct about. > vote. >> there are many courageous about in this body but it was a courageous and necessary act. we had to finish the job and get the money back when we get into office. it was absolutely essential to break the back of the financial crisis.

>> you keep and exempting housing. we have real problems in nevada. for the last four years straight, 49 straight months, nevada has continued to have the highest foreclosure rate in the united states. one in every 79 housing units in nevada has received a foreclosure notice. we have one county where i believe one in 49 homes have -- has received a foreclosure notice. we have over 400,000 households that zero more on their mortgage than they are worth. to put that in perspective, 3/4 of the people in their homes are more than their homes are worth. we have homes in northwest las

vegas that were priced at $375,000 that was priced in 2006. one went for a little over $100,000 last year. there was a condo unit that was selling in 2006 for $625,000. it is now selling for $106,000. when i talk to my constituents, they blend the banking industry. they say they are not willing to negotiate. the banking industry blames the fdic. the fdic blames you. i am trying to set to this picture -- i am trying to set this picture in a manner where you can respond. i want to give you two of your quotes and i don't disagree with this. you could help shed some light. you said i personally believe there will be a good case for the government reserving some type of guarantee to make sure people have the ability to

borrow to finance a house in a damaging recession. i think there will be a good case for that. you also said i don't think we will preserve fannie mae and freddie mac in their current form. we will have to bring fundamental change to that market. some people would say the that those two comments make sense. for my sake and perhaps my constituency's sake, kenya, where we are going in the housing industry? -- can you comment where we are going in the housing industry? >> excellent question and i am glad to emphasize the basic reality which is that the scars of this crisis are buried deep. the housing crisis is hurting your state and three other states and is still very hard.

it will take several more years to heal the damage caused by the crisis. we are trying to make sure that we can reach as many americans as we can to give them a chance to stay in their homes if they can afford it. the programs we have put in place have helped to 0.5 million americans to have a chance -- and held 2.5 million americans to stay in their home. we cannot help everybody. many people got themselves way over extended that we cannot justify using taxpayer money to stay in homes they cannot afford. we will try to reach as many people as we can. those programs are making a huge difference for millions of americans and we want to make sure that they do as much as they can. longer term, we have a housing system that is a mess and did not work. we laid out a plan last week to gradually wind down fannie mae

and freddie mac, gradually restore this market to a market or private capital provides most of the mortgages in this country, but still has the government played a targeted role in helping provide affordable housing alternatives to low income americans and we proposed a variety of other models. we want to make sure the government is providing some kind of protection against the risk of a severe recession in the future. we don't think fannie mae and freddie mac can be part of that solution. we want to begin a debate in congress how to best enacted that legislation. we want to restore the market but with better protections for consumers, more capital against risk, homeowners holding more equity in their homes, and some protection in a future crisis against picaresque when you have a mild recession turn into a depression.

that is a difficult job. we want to make sure these things are phased in gradually because we will not take risk that we will slow the process or damage the recovery. >> one of the statements the president made in the state of the union which i felt was very positive was his desire to address the corporate tax situation. while he did not express necessarily where he felt the rate should be lowered to, it was a very positive statement that that is an issue he wants to work on. do you have a sense of where he was to go from the 35% corporate rate to what level? >> for it to be worth it, you have to move substantially lower. >> into the 20's? >> right now is in the high 20's. to make a meaningful difference, you want to get it down

substantially toward that level. >> are you of the believe that by doing that you are incentivizing more domestic activity, economic activity to encourage more investment domestically? >> absolutely, you want the market allocating investment and choosing which companies grow and which companies succeed. system't want the tax making those judgments. if you can clean up the tax system and lower the rate and broaden the base, you probably improve overall growth. you want the tax code working with the objective and encouraging investment in this country. >> with those same goals apply to the individual taxpayer? >> generally, we will have to do comprehensive tax reform. as many people have proposed to the past, the best way to do

that to simplify the system is to lower the rate and broaden the base. >> under the president's 2012 proposal, he was to raise the two top marginal rates from 33% - 36% both of which would be over the corporate rate we are talking about reducing. if those same goals apply to corporations, why would the administration want to see an increase? >> if you think about those rates in context, that prevailed in the 1990's and we were doing fine as a country. we were the envy of the world and we would be thrilled to recreate that today. that is consistent with the strategy of making sure we are more competitive and growing and recognize that we have unsustainable fiscal deficits. if we're going to save money together and reduce spending, we want to make sure the savings go

to deficit reduction and improving incentives for investment in the country. >> we don't have the same economy as we did in the 1990's and i hope we can reconstruct the tax code that works for the current economy domestically and in the world rather than going back to the 1990's and tried to reconfigure the same tax structure that may not like that -- be applicable to what we do today. if we agree with me to lower the corporate tax rate to stimulate investment, why do we want to increase taxes on individuals if we want those same taxpayers to take their hard-earned money and invested in the economy and create economic activity? this seems to be in congress that we would want to lower the corporate tax rate and at the same time with 9% unemployment, you want to increase taxes on

people who want to invest in the economy. >> that reflects the difficulty of the choices we have to make its u.k. business is the choice, they would choose that mix. they would say that we are comfortable living in an economy where we see a modest increase in modest tax rates for only 2% of americans. they prefer to play in bad economy than the one we have today. >> i will detour from asking you about the president's budget for next year for a momentary the plan that house republicans released friday pertaining to this current year's budget could create an immediate crisis for millions of americans who depend on social security. the republican proposal cuts the social security administration's

operating budget for the rest of this current year by $1.7 billion, below what the administration needs for this current year, 2011. that is over $500 million below with the administration spent to serve the public last year with a smaller population of beneficiaries. as a trustee of social security, can you comment if that is the way that we should stored the most important program the federal government has for americans, especially those who are retiring? >> i would not support those changes for the reasons you said. >> if the cut is made as the republicans propose, it would be a loss of 3500 jobs and would shut down the social security administration's office for one month. that means we would have to

exploit to members in our community that for about one month, there would be no when answering the phones or responding to queries and no checks going out to beneficiaries. there would be no social security numbers issued to newborn babies and half a million would face these delays in starting with the creation of a budget like this. as a trustee for social security, can we handle this? >> i would not support cuts that would have that impact for those reasons. i have not seen those cuts and we don't know what the house will pass. we want to make sure that people understand the full implications. as we find a way to restore gravity to our fiscal position, we are not cutting into basic services and critical investments that will hurt the economy longer term.

>> on a related note, our republican colleagues are threatening to shut down the government of less certain cuts are made in certain programs. that would come to a vote on the debt ceiling limit and they would vote against it. some members on the republican side said they would vote on the increase to keep the government going unless there were cuts to social security. some have made a proposal to pay china first. you would have to first pay our other creditors including china and others who have lent us money. do you believe we should be holding the government and all those who depend on the services that the government provides hostage to make certain cuts back all the way have a devin -- devastating impact on americans?

>> i don't. i believe america has to meet its obligations. we cannot afford to do anything that would create a risk of jeopardize a this recovery, slowing the pace of expansion and employment growth and create any uncertainty in the minds of the american people in the broader investment community. this would be damaging to the recovery. i am completely confident that congress will act, as it always does, to raise the debt limit. i am encouraged by the comments that america will have to meet its obligations. we will have to have an important debate about how to restore fiscal responsibility. that is a necessary debate to have. we will have to work that out and make sure the world understands we are a country that meet its commitments.

>> we will have further discussion later on in coming up with tax reform policies. the president's fiscal commission on which i was privileged to serve called these tax loopholes tax earmarks. they get the game while the rest of the population does not. you touched on them somewhat. you had a conversation about the tax loopholes that go for the oil industry. will you continue to try to seek out consensus and make reform to our tax code? >> yes. >> thank you for joining us today. this is one of the most important issues for our

constituents. they understand our fiscal house is not in order. they are demanding that it be put in order. by way of clarification, it is important to appreciate that the president is the one who holds the keys as to whether the government gets shut down. she has said that he will not sign -- he has nwill not sign something detrimental. you thought was appropriate for the market to decide which companies grow and succeed. many of us and our side of the aisle and many americans believe this administration has grossly distorted the market and made it much more difficult for companies to be able to succeed in the way the normal business process has worked.

is incredibly important that we recognize that the kind of things that are being said don't necessarily square with what the reality is. i want to talk about what you have said and what the president said that this is a 10-year path. you said we need to take the lead in the initiative for so many of us, we are dumbfounded, astounded by the fact that this administration has not taken this opportunity to address the issue of entitlements. the automatic spending that is in the budget continues. if there is no change, that is what will make us greece with no pejorative opinion. the financial situation, why did you not address the entitlement

situation? >> what the president's budget does is reduce our deficit to roughly 3% of gdp over a five- year time frame which is necessary to stabilize our debt burden. >> in five years, are we any more capable of addressing the challenges of medicare and medicaid then right now? >> that is just a first step. solly the 10-year deficit which is essential and important -- solving the 10-year deficit is essential and important this president and his body has already passed and put in place the most sweeping entitlement reform to reduce costs. for example, in the last decade, there was a large expansion of medicaid to cover pharmaceuticals without paying for it which adds to our

deficit. >> i would suggest that what was passed in health care will increase costs to the federal government and increase our deficit and debt as opposed to decreasing it. it is remarkable when you say that we take the lead and initiative, but there is no evidence of this administration taking the lead and initiative on entitlement reform. you have taken the lead and insisted on expanding entitlements and automatic spending. -- on automatic spending. let's talk about sustainable growth rate and how physicians are compensated for the high- quality care they deliver. my reading of the budget is a recent is that over the 10-year window, i thank is about $341

billion, to allow for the sgr to continue. where are you getting that figure? >> we identify ways to cover that for the first two years but not for the remaining eight years. it is a prediction that congress will figure out a way to make sure we can sustain those rates at levels. we all my identify how to do it in the first few years. >> the assumption is that congress will take care of that and that money will be there. >> not on your own, we will probably have to join you to solve this. >> let me register my real concern about what i believe is a remarkable lack of leadership on the part of this administration in not addressing the issue of medicare/medicaid reform. >> the budget that the president

has presented seeks to add some improvements in our fiscal operations to revenue and spending changes. it is important to as those spending cuts are, some of those are painful, the ravenous are important -- the revenues are important. you don't believe we can achieve a balanced budget without some additional revenues, do you? >> no, i don't. you have to look at tax reforms as well. >> with reference to those tax reforms, one that you were involved in its corporate tax reform. we recently had a hearing in this committee on this. according to a bush administration treasury report, taxes on u.s. corporations represent a smaller percentage

of their profits than in other developed countries across the oecd. i believe last year there was a report out that corporate tax receipts representing a little over 7% of federal tax revenues. 50 years ago, it was three times that amount. president reagan, when he approved the 1986 tax reform act, he raised corporate tax revenues for the federal treasury by about $122 billion pe. the president said we should not borrow money or shift more of the tax burden to individuals in order to have corporate tax reform. i want to assure that that is a firm and unyielding position of

the administration that we will not borrow from the chinese to finance such reform and we will not beat shifting more of the burden to individuals. >> when we say revenue-neutral, we mean we would not support tax reform that reduces revenues from the corporate sector but it means we don't that it's realistic or achievable or desirable to try to raise revenues from higher taxes on businesses. we live in a much more competitive world. our statutory rates are much higher. that creates a player feel that works to our disadvantage. we don't think that we can shift more of the burden of the business community than they already have. we will not reduce and try not to go material higher than you have included in this budget

proposal international tax loophole closers you have had in the past. one i have been interested in is the one that deals with corporations that develop intellectual property, patents, various other forms of intellectual property, formulas and the like in the united states. just before they will be marketed, they do a joint venture offshore. we have testimony on this last year at our hearing from assistant secretary shay who said the administration would move forward to deal with this costly problem that i believe the budget just submitted says costs us about $20 billion over 10-years. does the administration continued to support dealing with this serious problem of shifting intellectual property

overseas as a separate matter from broader reform? >> we can do it in two different ways, by reforming the current system to reduce the opportunity our tax code provides to shift income outside the united states. or we can do it through reform. the objective should be to make sure that we are reducing both the incentives and opportunities in the tax system to shift income and investment outside the united states. >> i believe there are proposals for social security in this continuing resolution to make significant cuts to internal revenue service tax enforcement. people like to see that amount cut to zero. for every dollar that we cut in tax enforcement, we are reducing revenues by $3-$14.

does that remain true? >> absolutely, for every dollar you put it irs resources enforcement, you raise at least $4. >> we heard commentary earlier on social security. a furlough was suggested. with that not be a head -- and administered a prerogative? >> i don't have the privilege of managing the social security administration. i would say that if the cuts have that impact, i think it would be imprudent i have not

had a chance to look at those cuts. >> i would like to do my part for not participating in hyperbole for various reasons. i think you can agree we are facing some significant challenges. we have touched a bit on taxes today. i hear a lot about the estate tax. from rural nebraska. they say it is double taxation. do you agree? >> i don't know how i would describe it. the rates and exemptions we propose would make sure that tax only affected one-half of 1% of the states in any given year. we are not proposing a because we like doing it.

we are proposing a because we have unsustainable obligations. that will hurt future growth if we don't fix them. we will have to do a bunch of things to spread the burden. our proposals would only affect 1/2 of 1% >> by appreciate that. -- >> i appreciate that. it would affect the narrowing of the tax base that fewer and fewer people would be paying taxes whether it is the federal income tax, how do think we can address that? >> if you look at our tax system today, there is lots of on fairness across the system. you referred to one piece of it

which is lower income americans pay federal taxes but many don't have to pay the income tax as a whole. it is also true that as many of our most successful executives said, you can be a successful businessman today and pay much lower effective tax rate than people who work for you. that doesn't seem fair. we are trying to propose initial reforms to leave us with a more fair system. >> i can appreciate that. as well on the corporate tax rate, is there any concern that letting that go back up or pushing them back up could actually result in fewer capital gains tax been recovered? >> not that 20%. congress has to make that choice.

we think that is a modest rate on capital income. >> but still, increasing the penalty of a transaction, there would be no risk or very little risk of having fewer transactions? >> i think it would have a small effect. we have some offsetting considered good but i think that would be a nominal change. >> thank you. i yield back. >> thank you for joining us them because of a short time, the ranking member and i said we will go to three minutes to accommodate every member. >> i am happy to respond in writing to any questions. i am sorry i have to leave at 3:30. >> thank you for joining us. as a result of an agreement last december, the estate tax for the

next two years will be imposed at a top rate of 35% with a $5 million exemption. in 2013, present obama has proposed to make this permanent. he would change it to $3.5 million exemption. i am a sixth generation kansan and my kids are the seventh generation to grow up in eastern kansas. kansas is an ag state. i hope you have an appreciation for the importance of the family farm to this nation. do you know what the price of a new, is? ombine is? >> the agricultural part of the

economy is quite strong today. you are seeing basic growth in agriculture. we want to do everything we can to reinforce that. >> we feel like we are under attack here. a new, costs over 300,000 at -- a new combine costs over $300,000. if you attach anything, it is $170,000 on top of that. the cost of the necessary equipment to manage a farm can be quite high. it can easily top $1.5 million in equipment. several years back, the usda did a study and there was nearly 11,000 kansas farmers that have land and buildings valued at over $2 million. the cost of equipment and land values, it is not hard to get to

the $3.5 million cap that the president is proposing. the average net income on a family farm is $45,000 per year. under the president's proposal, it is not unreasonable to expect that a significant percentage of kansas family farms could be placed at risk when try to comply with federal tax laws. they might not meet the capital requirements to maintain ownership between generations. i would like to see if you realize how this proposal negatively treats family farms. how do you advise family farms address this challenging issue? it has been promised that taxes would not be raised on those earning below $250,000.

how do you explain hitting them with a tax increase that could cost many of them their livelihood? >> the estate tax changes would affect less than 1/2 of 1% including the families that you are concerned about. we share those concerns. in the tax package passed by congress, the president included a provision for one year and a business in the country can fully expend capital investment against their taxes. that is one reason you see capital investment expenditures start to accelerate. if you look at the overall max of things we are proposing, they will substantially improve the capacity and competitiveness of american companies. >> thank you for being here.

if you are interested in saving family farms, i have a bill for you. it is important that we discussed this bill on the budget today on the same day we are beginning the debate on the cr. a couple of my colleagues have juxtaposed the differences. a major one speaks to the issue that we are interested in a budget that gets people back to work. that is the antithesis of what they cr does given the early aetna -- analysis that that would cost about 800,000 jobs. if you just oppose what is happening today in the cr and the president's budget, specifically the build america bonds which were so successful sacramento airport used those purveyed generated 1250 jobs.

every district across the country can say something similar. i would like to hear how you deal with that. that is certainly a job-create towaor. also on energy issues, i notice the president's budget extends the 1603 grant program which is so important for renewable energy and the section 48c provision, the manufacturing tax credit which is important to keeping those jobs here in america. i'd like to hear about that and what you see as an opportunity for us through encouraging and investing in renewable energy and how we can use that to create more jobs. i should mention the potential

loss of traditional energy jobs that cr will make some cuts that will make it impossible to get permits renewed and issued for those traditional energy jobs. that puts us at an energy disadvantage. >> i would share the caution that as you look to make these changes, be careful not to cut investments that will hurt jobs and do not cut investments that will hurt our competitiveness in the future. when you think about the broader fiscal challenges, make sure you bring a long-term perspective and you are putting in place restraint we can live with overtime that balances the need to make sure we are strengthening the economy as a

whole and bring some gravity to our fiscal position. >> thank you for being here. got isgest concern i've about the taxation. i want to touch on a couple of things. we are all interested in jobs. if we grow jobs, that will cut the deficit. i have been in business 30 years and had 1000 employees four years ago. i have dealt in these metal markets. let me give you my observations from florida. there is a severe lack of credit for small and medium-sized businesses. you have acknowledged this several times. compared to four years ago, they can talk about credit but unless you put up a half-million dollar cd cannot get a line of credit.

the second thing is health care. to make it is a big entitlement program for 50 million people but it does not do anything to bend the curve for small and medium-size businesses. one of our businesses in sarasota are getting ready to hire 300 people. their health care bill when of $100 million. that is the same with small companies. my health care bill went up 20%. it is killing jobs for a lack of credit is killing jobs. the third thing is increasing taxes. you said that it only affects by raising taxes 2%-3%. that might be true of the percentage of businesses that make up over 35% but how many jobs do they create? there are people that might make

$1 million today but they have 700 employees. they need more capital. if we raise their taxes along with a lack of credit and health care costs going up when you start raising their taxes -- how do you respond to the tax aspect of the president's budget? >> you are right about the credit problem. it was too easy before and it is too tight now. some of these people or a victim of the bank overextending. we hope that will improve. the numbers suggest that is starting to improve. the price of lending is lore that has been in the past couple of years and a small business program is working its way through the system. it should help states provide more financial power to their credit programs. we have to make sure the bank supervisors -- >> i really want to hear about

the tax peace. >> i am telling you the numbers that the independent tax people tell the congress. it is 2%-3% of companies. >> that employ how many? >> they employ a substantial amount of people but the companies affected make substantial amounts of earnings. >> they are not all law firms and investment companies. >> they are not but they are overwhelmingly s -- and earning substantial amounts of money. these are the rates that prevail at a time when the small business community in this country -- >> we don't have the same circumstances today that we used to have. >> the time has expired. we have three members on the side that have not had an

opportunity to pose questions. >> let's have them present their questions. when you complete your question, we will go to the next person and maybe you can summarize at the end. >> i identify with the energy situation. [no audio] my specific question that i would post to you deals with my friend from louisiana who talked about a potential downside impact of the president's proposal to eliminate outdated

fossil fuel subsidies for the oil companies and invest in energy in the future. i have introduced legislation that would do exactly that. i would hope that you could analyze for us -- in a world oil market where a barrel of oil is fungible that is in a range of $2 - $3 trillion, what impact would $8 billion have on that amount? with that benefit europeans or chinese? would that make any difference at all? that would be useful for us to have as proper context >. >> my question comes from north

dakota. back in the 1980's, we had a real financial problem. we increase taxes and the problem just continued. a decade ago, we had the same problem that other states did enter the dot com burst and we took the opposite approach. we tighten our belt and did not raise taxes. we encourage private-sector growth and we are below 4% unemployment today. we encourage oil and the energy industry to grow. my question relates to the importance of small business. when you tax small business that is negative for them, it creates uncertainty. in this budget, i see the tax is going up on small businesses. they are paying it as ordinary income. 50% of small businesses pay

taxes on their income. how can we increase the taxes on the small business. ? how can that be good for the economy? >> i have a follow-up question about the fiduciary definition being worked on by labor and the sec. the economic policy institute which is non-partisan had a chance to analyze the republican continuing resolution before us this week. they determined that if it is enacted, it would result in over 800,000 jobs being lost in the private and public sector. i find that number of fascinating. the day president obama was sworn in, we were losing 800,000 jobs per day. -- per month. since then, we have had 11

consecutive months of job growth. $17 trillion of wealth had been destroyed in the stock market the day he was elected. the day he was sworn in, he inherited a $1.50 trillion budget deficit. the first year, it was revised downward by $150 billion. it is going up again next year due to the continuation of the bush tax cuts that they supported on the other side. i think we have a stark contrast between two different visions. we have a dark assessment about the vision of our nation and the possibility of economic growth and one that is more of -- hopeful and optimistic. this administration has opposed good suggestions on -- in the area of innovation.

there are smart investments and that spending that we have to get control of in order to bring balance to all of this. if you can submit a written response to highlight some of the important investments that we have to move forward on to create a sustainable long-term growth. >> i want to read from your written testimony. you say that our deficits are too high and they are unsustainable. these deficits will hurt economic growth and make us a weaker nation and we must go back to living within our means. i could not agree more. this budget predicts over the next 10 years that we will lower our deficit to 3%. i am thinking about my 14-year- old grandson and 10 years from now what i can say to him is that i am sorry, we can only lower this to 3% and you will

have at least a $15 trillion deficit that you and your family are going to have to pay back. i could not get it done for you. why is our goal to still be at a deficit and not a balanced budget and not growing our economy to the point where we can pay down our debt? that does not seem like a good goal? >> that is a place to start but it is not enough. >> i think you need to address this directly that we did not, maybe the president did not address it for other reasons, the entitlements, but it is not true that federal health care reform -- they adopt many of the recommendations from the

independent advisory commission from congress. the medicare payment advisory commission had specific recommendations. by having a medicare center for innovation, medicare can bring the costs down. i have never heard anything about that. we're talking about public employees cavalierly. they have given their lives to this country. you cannot painted with a wide brush. we are increasing private jobs and the public is going down. that will cost us money. >> two questions i want to

highlight -- one deals with the tarp tax, the tax being levied and institutions over $50 billion. why are we saying that all institutions over $50 billion took tarp or not and we exempt out some entities that took tarp? when the administration says we are making money on tarp, why would we need a tax to begin with? the other question deals with -- the budget seeks to penalize companies that utilize a deferral. for those of us that have companies in our state that are large multinationals, how does that help create jobs?

more importantly, how does it help us become more competitive in the world climate? if 80% of what they sell is manufactured and sold in other countries, i would suggest that perhaps these companies will leave that we continue to make it less competitive for them to remain in america. >> i was hoping to have more of a discussion.0 i appreciate your being here today. with respect to the health care reform law that we put in place and you so ably helped to lead the charge on and talk about the impact on the u.s. economy. i would like to have had a a conversation about the taxation on america's middle class.

this will kill jobs in america. i would like to have talked about that. it will kill small businesses. they will never use the tax credits they have been afforded. small businesses are using tax credits and even though we are not killing small businesses in this country, nor are we killing job creation and growth. we see growth in the private job market. there will not be an increase because of that bill on taxes in the middle class. i would like to have had an opportunity to talk about that. thank you very much for being here today. >> i want to thank you for your time. we will given the opportunity to respond if you like to touch on any of those things or respond in writing at your discretion.

>> let me make a few final points. if you care about entitlement reform and our long-term fiscal deficits, the more -- the most important thing is to make sure we reduce health-care costs. if we can find ways to go beyond that, we welcome a chance to do that. we have had discussion about the state of the economy. by any measure, you can look at the fact that the stock market is up 100% since we came into office or profitability as a whole. you can look at private growth. the american business sector is in a dramatically stronger position today because of the actions taken by congress and the president and the fed over this period of time. we want to reinforce that because we still have challenges ahead.

the law that authorized the tarp requires the administration to propose a fee to cover any losses so we hold the taxpayer harmless. those costs have come down dramatically. outside of housing, we are likely to earn a positive return. because the independent estimate says we still have some risk loss, we feel obligated to put in the budget and we proposed to recoup that so the taxpayers are not exposed to that. as you think about deferral, think about it this way -- the current tax system at the margin makes it more likely that a company in your state will build a plan outside the united states rather than inside the united states. if you have two companies

competing, the current tax system will favre with a lower tax burden the company that builds the next plant outside the united states. it is a complicated thing to fix and we are committed to fix it. as a look at these changes, you want to join with us in making sure the tax system is working with our broad objective to try to strengthen incentives for investment in the united states. when you give a particular industry a tax credit, it means all other businesses on average pay a higher tax. that is not fair. it makes us less competitive and that is worth changing. nice to be here today and good questions and i look forward to continuing the discussion with you and let's see if we could do corporate tax reform. >> thank you for being so generous with your time. its members have questions, they will submit to you in writing and thank you again, mr. secretary. this hearing is now adjourned.

[captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> next, "washington journal." at 10:00 a.m., jim jordan on the strength of the republican study committee and how it can influence decisions on spending issues. the white house budget director will testify after that on the 2012 budget request.

donald rumsfeld was the youngest and oldest person to serve as u.s. defense secretary. if you had >> proximity to a president "automatically have an obligation to tell him the true that what you really believe. people who don't have proximity and only go in and see him occasionally simply don't want to do it. >> tonight he will discuss his philosophy of presidential staff leadership, the process of writing his memoirs, and address some of the book's critical and positive reviews. >> coming up next, it is "washington journal."