>> if you recall it in the 1960's and 1970's, we were writing off urban america. >> with wall street's reemergence, new york city was really pulled into the global economy and became america's gateway to that economy and has really prospered ever since. >> watch the rest of the interview sunday night on c-span q&a. >> x, nouri clinton on military action in libya. then a discussion on ethics in government, then a forum from the consumer federation of america. >> secretary of state hillary clinton spoke earlier today about military action by the u.s. and its allies against the forces of libyan leader muammar gaddafi. earlier today, libyan government troops attacked the rebel

capital in violation of a un cease-fire resolute -- resolution. she made these remarks in paris at a summit of leaders gathered to address the ongoing violence in the country. this is about 25 minutes. >> hello. before we begin, i want to sell a few words about warren christopher. he was a friend, and mentor, and truly a diplomat's diplomat. he served our country with such great distinction in so many capacities over his long and very productive life. there are a lot of days in this job when i asked myself, what would warren do? from the balkans to the middle east, china, and vietnam, he helped guide the united states through difficult challenges with tremendous grace and wisdom. my thoughts and prayers are with his family and with his many,

many friends and colleagues throughout our country and around the world. now, this has been a quick but predict if -- productive trip. first, let's remember how we got here. as you know, americans and people around the world watched with growing concern as libyan civilians were gunned down by a government that has lost all legitimacy. the people of libya appealed for help. the arab league and the gulf cooperation council called for action. the international community came together to speak with one voice and to deliver a clear and consistent message. colonel gaddafi's campaign of violence against his own people must die. the strong votes in the united nations -- against his own people must stop. now the gaddafi forces face

unambiguous terms, a cease-fire must be implemented immediately. that means all attacks against civilians must stop. troops must stop advancing on benghazi. water, electricity, and gas supplies must be turned on to all areas. humanitarian assistance must be allowed to reach the people of libya. yesterday, president obama said very clearly that if gaddafi failed to comply with these terms, there would be consequences. since the president spoke, there has been some talk from tripoli of a cease-fire, but the reality on the ground tells a very different story. colonel gaddafi continues to defy the world. his attacks on civilians go on. today we have been monitoring

the troubling reports of fighting around and within benghazi itself. as president obama also said, we have every reason to fear that left unchecked, gaddafi will commit unspeakable atrocities. it is against that backdrop that nations from across the region and the world met today here in paris to discuss the ways we can, working together, implement resolution 1973. we all recognize that further delay will only put more civilians at risk. so let me be very clear about the position of the united states. we will support an international coalition as it takes all necessary measures to enforce the terms of resolution 1973. as you may know, french planes

are already in the skies b aboveenghazi. america has a unique capabilities and we will bring them to bear to help our european and canadian allies and arab partner stop further violence against civilians, including three the effective implementation of a no-fly zone. as president obama said, the united states will not deploy ground troops, but there should be no mistaking our commitment to this effort. today i was able to discuss next steps with the full group and also conduct smaller, focused conversations with many of my colleagues. i met first with presidents are cozy and prime minister cameron. both france and the united kingdom along with other key partners have stepped forward to play a leading role in enforcing 1973. we reviewed the latest reports from the ground and discussed

how we can work together most effectively in the hours and days ahead, and how we would work very cooperatively with our other partners, including belgium, canada, denmark, germany, greece, italy, lithuania, the netherlands, norway, poland, portugal, spain, turkey, as well as others that are not in that long list. i also had the opportunity to engage today with my arab counterparts, including the foreign minister from iraq, reprimand -- -- representing the presidency of the arab summit, qatar and minister of catarr the prime minister of jordan. we have said from the start that

arab leadership and participation in this effort is crucial. the arab league showed that with its pivotal statements on libya , it changed the diplomatic landscape. they have sent another strong message by being here today, and we look to them for continued leadership as well as active participation and partnership going forward. i reiterated our strong and enduring partnerships. the united states has an abiding commitment to gulf security and a top priority is working together with our partners on our shared concerns about iranian behavior in the region. we share the view that iran's activities in the gulf, including its efforts to advance its agenda in neighboring countries, undermines peace and stability. our golf partners are critical

to the international community's efforts on libya, and we thank them for their leadership. we also had a constructive discussion on bahrain. we have a decades-long friendship with our rain that we expect to continue on into the future. our goal is a credible political process that can address the legitimate aspirations of all people of bahrain, starting with the crown prince's dialogue, which all parties should join. of course that process should unfold in a peaceful, positive atmosphere that protect the freedom of peaceful assembly while ensuring that students can go to school, businesses can operate, and people can undertake their normal, daily activities. my gcc counterpart said they share the same goals in bahrain. bahrain obviously has the sovereign right to invite gcc forces into its territory under

its defense and security agreements. the gcc has also announced a major aid package for its economic and social development in bahrain. we have made clear that security alone cannot resolve the challenges facing bahrain. as i said earlier this week, violence is not and cannot be the answer. a political process is. we have raised our concerns about the current measures directed at our rain -- at bahraini officials. we have discussed the urgent humanitarian needs arising in the crisis in libya. i thank the arab leaders for their generous contributions to aid refugees fleeing gaddafi's violence, and we agreed that this will be a critical concern in the days ahead. egypt and tunisia in particular will need all of our support. the united states has made

significant pledges of assistance, and we look to all of our allies and partners to join us in this work. this is a fluid and fast-moving situation which may be the understatement of the time. i know that there are lots of questions that people have about what next, and what will we be doing. let me just underscore the key points. this is a broad, international effort. the world will not sit idly by while. the united states will support our allies and partners as they move to enforce resolution 1973. we are standing with the people of libya, and we will not waver in our efforts to protect them. thank you. >> madam secretary, will u.s.

military assets be engaged in flying live fire sorties? i am is wondering how active will the u.s. military involvement be? >> i will stand by what i said. we will support the enforcement of 1973. we have unique capabilities to bring to the international efforts, and we intend to do so. >> you mentioned twice that it is important are crucial for arab leadership -- do we know what that leadership and participation specifically is? >> i think the fact that we had the representation around the table that we did today and a very strong statements that were made by arab representatives is extraordinarily important. i will leave it to them to

announce their contributions. i think that is the appropriate way for any further information to be made available. >> but you do expect something more than just being at the table today? >> we do expect more. >> the reports now coming in are that it is quiet, and it appears that the tanks have stopped. president sarkozydents are coz said -- could it actually engage with muammar gaddafi after what has happened? >> i will let him explain his own statement, but our assessment is that the

aggressive actions by gaddafi forces continue in many places in the country. we saw all over the last 24 hours and we have seen no real effort on the part of the gaddafi forces to abide by a cease-fire, despite the rhetoric. several of the speakers from the table said forcefully that they have heard these words, that her them publicly, they were conveyed privately, and they are not true -- they heard them publicly. our assessment is that it is time for the international community to take action to back up resolution 1973. >> in terms of the goal of this operation, is it to protect civilians, or is it to remove dufty from power?

>> it is to protect civilians and to provide access for humanitarian assistance. if you read the very comprehensive resolution that the security council passed, it is focused on protecting civilians from their own government. >> has bahrain or the usa meet uae given any indication that they will fly a fighter jets over libya? >> again, i will let the individual companies make their own announcements. >> is there any way that the u.s. could see the libya situation resolving itself with -- with gaddafi somehow still in play? what would this action with the un resolution before his arrival in the long term?

>> those are all questions that standing here are difficult to answer, and certainly the conditions that will unfold as we began to enforce this resolution will make in new environment in which people are going to act, including those around colonel gaddafi. i think we should take stock of where we are and how we got here, and how many times the international community called on the dockery to end the violence against his own people and to take demonstrable steps to end the aggression and pullback, and time and time again, starting with the first resolution in 1970 -- 1973 the succeeding time, there is no evidence that he intended to do

so, despite various claims that were made. if the international community is to have credibility in this show of unity in that 1973 represents, then action must take place. if you look at all possible permutations of what could or could not happen once the international community begins to enforce the resolution, there are many different outcomes, and i am not going to speculate on what will occur. >> what did the group of leaders today actually agree to do? >> they agreed to take all necessary measures, including military action, to enforce 1973. those are operational details. it is understandable that we are not going to lay out every asset

that has been pledged and every action that has been endorsed, but i think that coming together under president sarkozy's leadership today, to indicate that the words in the security council were more than just rhetorical commitment, but are being translated into very specific actions. some countries are more public with their specific pledges to what they are willing to do, and others are looking at how they can best contribute, but the conclusion of this meeting was, for me, very positive, because it was an unmistakable commitment to enforcing the 1973 provisions. [unintelligible]

>> i think as i said, french planes were in the air as we were meeting, and there will be other actions to follow, but there is no doubt that we are going to begin to enforce the resolution. >> for much of the four years, colonel gaddafi has been granted an international outlaw -- for most of the 40 years. >> i think there are three very important interests. number one, with all of the activities that colonel gaddafi engaged in in the past, we in the united states had a very clear interest in trying to contain him and prevent him from taking both direct and indirect actions against us and our

people, as well as many others. following his decision to give up nuclear weapons in 2005, when it was finally resolved, it appeared that there might be a new opportunity from him to join the international community. but unfortunately, that has not proved to be true, and we now have the very brutal crackdown that he is conducting, which reminds us all why he was considered an outlaw in that past. it is unfortunate, but it is a reality that we have to take into account. secondly, this has been a time of great ferment in the region, and you have to countries bordering libya, egypt and tunisia, that are committed to a

democratic transformation, and they have long borders with libya, and they are facing humanitarian crises on those borders. there is a lot of concern about the people who are still inside libya, both libyans and third- party nationals that no one can get to and that are basically and accounted for. a very unfortunate surmise that gaddafi does not approve of democracy and the actions being taken by his neighbors, which poses a lot of questions about what he might do in the future. but thirdly, the arab league and the gulf cooperation council statements calling for action by the united nations were of historic importance. there was a recognition by the

arab countries that gaddafi had to be suspended from the arab league, but even beyond that, that a no-fly zone and related actions had to be taken. i think it would be quite unfortunate if the international community were to have ignored those requests, and it is in america's interests, along with our european and canadian allies, to forge strategic partnerships with arab nations as we move forward into this new era of change in the arab world. so there are very specific reasons, there are regional concerns, and in my view, there are very strong strategic rationale as to why the united

states will support -- we did not need this. we did not engage in unilateral actions in any way, but we strongly support the international community taking action against governments and leaders to be paid as gaddafi is unfortunately doing so now. we think an international order that can bring about this kind of unity is very much in american interests. >> could ask what follow-up? you just said as conditions are unfolding that will create a new environment in which people will act, including those around colonel gaddafi. can we read that to say you are in a sense giving up on influencing colonel gaddafi, that you are now adding a lot of this at people who are around him? >> i think we are aiming the messages at all the decision makers inside libya.

as you know, there have been quite a number of defections. the opposition is largely led by those who defected from the get off beat regina or who formerly served it -- from the gaddafi regime. people will put the future of libya and the interest of the libyan people above their service to colonel muammar gaddafi. >> are you any closer to making a decision on whether to follow the french lead in recognizing the opposition? >> we are not ready to make a decision. we have increased our outreach and cooperation with members and leaders of the opposition. we are in almost hourly contact

with someone, but we think that the most important step for us to take now is to assist in every way that is unique to american capabilities with the enforcement of 1973, which is, after all, the principal demand of the opposition, and that is what we are trying to meet. >> you said you were in almost hourly contact. >> some of the president should go to congress with the debate [unintelligible] what do you think of those comments? is there merit to that? >> i think the president made that clear in a meeting with congressional leaders, that he

held in outlining all the reasons why the united states was prepared to act in support of the international efforts on behalf of 1973, and of course we would always welcome congressional support, but the president was very clear that the united states is acting in a way that is within the existing authorities available to him. thank you all. have a great night in paris, those of you get to stay. >> next, a discussion on ethics in government, then the weekly addresses by president obama and washington are represented jaime herrera but are. later a form from the consumer federation of america. tomorrow on "washington journal," i reporter's

roundtable on the week ahead in congress and the white house. daniel weiss examines the obama administration's energy policy in the aftermath of japan's earthquake in nuclear prices. claudia rosett discusses the role, composition, and effectiveness of the united nations and its relationship with the u.s. "washington journal," live at 7:00 a.m. eastern on c-span. >> we were writing off urban america. >> major business leaders, working to keep this city the center of the business world, on how york bank that position. >> with wall street reemergence, new york city was really pulled into the global economy and became america's gateway to that economy and has really prospered ever since. >> watch the rest of the interview sunday night on c-span

q&a. >> the gerald ford presidential museum in michigan recently held its first annual symposium on ethics in america. the discussion focused on how public officials handle ethical issues, from the intent of the founders of the constitution to the use of e-mail but today's public officials. stephen for talks about how his father dealt with the dilemma of whether to pardon richard nixon after watergate. this event is an hour and 25 minutes. >> steven ford has traveled the road from a teenager in the white house to a very successful and most interesting and eclectic career. at various times, and sometimes simultaneously, he has been a cowboy, rancher, actor, businessmen, corporate spokesman, and motivational

speaker to corporate and student audiences alike. on august 9, 1974, when gerald ford was sworn in as the 38th president of the united states, steve and his three siblings suddenly went from being the kids down the block, living typical private lives in suburban young adults, to the only kid on the plot at 1600 pennsylvania avenue. the media spotlight was instantaneous and intense, and not always easy to handle, but steve and his siblings arrive and thrived. he is here to give us an insider's view of his father's values throughout his distinguished life and career, and to share with us the lessons he has learned, first as the son of the president, and then as a successful figure in his own right. please welcome the chairman of the gerald ford presidential foundation, steve ford. [applause]

>> welcome, thank all of you for being here >> that if they were here would tell you this is what he wants, to create a place where this becomes the towns where were we all come together and discuss ideas, one side versus the other. we find out what we think about different issues, and the topic tonight, ethics, certainly is a moving target. i am not sure i am quite qualified to be up here. i guess to sort of dropped the drawbridge to my soul, 18 years ago, i can look backs that my

life, and ethics was certainly a big part, because a that time i was struggling with alcoholism. i found myself in many situations that i would look at today and think that is not ethical behavior. so i come here today with my own stories, but i am glad to say 18 years later, i have 8 -- 18 years of sobriety and a good 12 step program, and a great mother who help me get through that time. i come as a humble human being who faces these ethical choices everyday of what we should do, what we think about doing. it is a fascinating subject. we could spend hours, obviously, on this and it could go on for days. you have medical ethics, government ethics, the golden rule. it is a fascinating subject. sometimes it is a dilemma.

it is a moving target. sometimes it concerns the law and sometimes it does not concern the law. i am fascinated by the subject. you think about the old story of robin hood, stealing from the rich and giving to the poor. it could make a case that his stealing was unethical, but giving to the poor was moral. you could make a case for a spouse cheating on her partner in a marriage. obviously unethical, but probably not breaking the law. so sometimes the law is involved and sometimes not. sometimes there might be a law that would dictate something about it, but it is never prosecuted. it is a moving target and a fascinating conversation for all of us here tonight. when i thought about this subject, i thought what were some of the most recent situations that ethics get

involved in. i think the recent financial meltdown in the last several years, and banks and loans and institutions like that, and it works both ways. you had sophisticated loan officers who were dealing with unsophisticated applicants for a loan, and convince them at times, not always, but at times to take out a long they could not -- could not afford. there was a lot of pressure there in what i would say was something of an unethical situation. work the other way, you had sophisticated people who were trying to get a loan and walked in and purposely misrepresented their income or their worth to get along -- to get a loan. the ethics worked on both sides of the equation. tonight, my little time of year, i want to start the discussion with a few examples of how i saw

my father live his life. i think he tried on a daily basis to live in it in a very, very ethical way. we were talking before the program here, and if you look at dad, probably the biggest public example of his administration, of his time in politics, dealing with a tough, tough ethical decision was dealing with watergate and the nixon pardon. before you can really talk about the pardon, you have to go back before dad was even president, and some things had to fall in place for him to even have that chance to make that decision about the nixon pardon. you have to go back to 1971, when a group of men as we all know them today, the plumbers who were established by a white house adviser john ehrlichman. they were later called a special investigation unit.

the plumbers, before water gates of you might remember, the plumber's went in and broke into daniel eldersburg -- daniel eldersburg psychiatrist's office in 1971. they were trying to get information detrimental to annualellsberg to stop war classified information on vietnam. some of the paper showed the fallback position of the united states during the height of the cold war. they made a decision to illegally breaking and to daniel doctor's office under the banner of national security. they made a choice, and they broke some laws to do that. those men and the white house saw this as a national security issue, and they felt they were

answering what they felt at that time was a higher calling to the president of the united states, and not the laws of this nation. that situation was in 1971, and in 1972 this same group of plumber's broke into the watergate hotel, the democratic headquarters, and watergate was started. all of that fell into place, which caused the nixon presidency to come tumbling down eventually. that, on the other hand, and this is what i find fascinating about this story, as all of this was happening in 1973, as watergate had already started, richard nixon had to find a new vice president because spiro agnew had stepped down from office also because of unethical behavior. -- hename was on the list had been a congressman for about 25 years from here in grand

rapids, michigan. his name was put on the list with about 10 other people that possibly might be chosen as the next vice-president to replace spiro agnew. to be honest with you, we thought dad's name was at the bottom of that list. other names would have been governor rockefeller of new york, former governor of texas john connally, men that had greater national presence and dad, who was the house minority leader in congress. but the foundation was being laid in dad's life early on as he grew up in grand rapids, and the people that invested in his life, he had the image of being a straight shooter, the boy scout, the square, and when it came to making a decision about picking a new vice-president, the most important thing to nixon at that time was to make sure his choice could get through congress.

there was no controversy about that. he had that boy scout image. very ethical, work with both aisles of congress and both sides of congress. he could reach out across the aisle and find compromise. as you had the plumbers going this way with unethical decisions, you head gerry ford rising up and be needed because he was making very ethical decisions. as data first became vice- president -- and dad first became vice-president, my mother finally got him to retire. that was going to be his last term in congress. he was going to come back to michigan and be a lawyer. he had been in congress for 25 years, and he said if we don't win a majority and the republicans take over congress and i don't become speaker of the house, i will go back to

grand rapids and start my law practice up again. mom was relieved. she wanted to come home. all of a sudden in october of dad torichard nixon calls tha ask him to be the vice- president. and my mother was not happy. i will never forget my dad tried to calm her down and relieve her. i remember him saying to mom, betty, don't worry, vice- president don't do anything. [laughter] that turned out to be false, as we all know. thinking about the pardon, a month after dad took office, the pardon happen. let me walk you back 30 days earlier. everybody remembers the image of the helicopter with nixon taking

off from the south lawn of the white house, nixon waving goodbye. i stood there with my parents and watched nixon leave. we went into the self the east room of the white house where he took the oath of office. this was not a joyous occasion. this was somewhat a constitutional crisis. you had a man who was going to take over the reins of this country. we had the vietnam war going on, we had a huge recession, the stock market had lost 45% of its belly, the cold war with the russians, -- loss 45% of its value. this had never happened before in this country. dad those and becomes president and then finds himself 30 days later in a situation where -- let me back up just a little bit. right after dad became president, nixon went to

california. one of the first request that the president's staff had back at the white house was to send all the documents, papers, and takes out to san clemente. many were still in the basement of the white house. dad said absolutely not, there was still a criminal case pending. nixon still had potential criminal charges pending against him. but the justice department ruled that every former president owns their papers, documents, and .akepes but dad refused. he thought that was not the right thing for him to do, it had to be preserved as evidence. i remember sitting there thinking wait a second, if this stuff goes to california, there were probably be a huge bonfire on the beach tomorrow morning. that was the reality of the situation. it found himself going against his own justice department.

congress was spending 25% of everyday dealing with richard nixon. dad was spending 25% of his day dealing with richard nixon, even though he had the vietnam war and the cold war and recession going on. after speaking with several people, nixon could have dragged this out for for five years in the courts. i think that is where dad finally came to the decision that he had to do something to get necks and out of the way so the country could move on and deal with -- get nixon out of the way so the country could move on and deal with the war in vietnam, the cold war, and the recession. the pardon was the answer. the researched it, and that based their pardon on a 1933 ruling by the supreme court, where a man was held in federal custody and the government

wanted him to testify and said they would give him a pardon, and he refused to pardon because he said he was not guilty of anything. i think the supreme court had ruled that by granting a pardon, there was an indication of guilt if you accepted the pardon. been becker who was dad's legal counsel on the pardoning nixon situation went out to san clementi and met with former president nixon, explained to president nixon that the pardon was based on a 1933 case, that by giving the pardon, there is an indication of guilt, and if he accepted it, it was an acceptance of that guilt. nixon initially turned down for several days, did not want to accept it under those terms. they knew at that moment president nixon was not going to say publicly that he had

committed crimes or done anything, but finally nixon came back and accepted the party under those terms. -- accepted the pardon under those terms. it basically ended dad's political career. he knew it would probably cost him 5% or 10% of the vote when he ran against jimmy carter. in his mind, and just knowing him and how he operated, it was not about him. it was about the country, and he felt very strongly that the country had to move forward, and the only way to do that was to push nixon out of the way. so they could start dealing with the economy and unemployment and inflation and the vietnam war. i think dad's roots came back here to grand rapids and his roots were about being a public servant and serving the public,

and i think he was willing to give up his political future, thinking long-term instead of short term. i am always amazed, because one of the things that is brought about the nixon pardon is at the same time he pardoned richard nixon, he went and gave a speech in front of the veterans of foreign wars and also recommended that there be amnesty, a program set up so that young men who had dodged the draft and went to canada could comeback to their families, come back and not be prosecuted. it was very symbolic of what he was trying to do. it was not about nixon, it was about putting your arms around the whole country and healing this nation and bringing people back home. it did cost him an election, there is no doubt about it. i don't think he would ever

regret his decision. he knows he did the right thing at the right time. it does come full circle in the end. i was curious, and i highly recommend you read the book, because i wanted to read some of the material by some of the people involved in the watergate situation. a great book that i finished a couple of weeks ago by one of the original code directors of the plumbers unit -- co- directors of the plumbers unit. he went to jail, which a prison. he had a complete transformation, from what i can tell, of realizing what they try to justify under the name of national security, serving the president, and breaking loss was not right. he finally admitted his guilt and went to prison. in his book, he talks about we

made on ethical decisions. -- unethical decisions. our allegiance to our superiors, to the president and the president's staff, got in front of our allegiance to the law of this nation and the constitution. early on in the book, on page 2, he writes "why did this burglary happen? i am convinced the collapse of integrity among those of us who conspired, or, and carried out this action was the principal cause." he talks about how you get caught up in that power, and serving a president, dad in his speech talked about how he found out that we re nation of laws, and not just one man, and that our laws are more important than one man's ambition.

i do want to share one thing with you. i had another story out was going to talk about -- i was going to talk about. as this comes full circle, 20 years after the nixon pardon, after dad lost the election to jimmy carter, it did make this complete term, because dad was invited to the john f. kennedy museum by caroline kennedy and senator ted kennedy to receive the john f. kennedy award for courage in public service because of the nixon pardon. senator ted kennedy stood up there and talked about how 20 years earlier, he thought that had sold the country out, and it looked like an unethical decision to him at that point. he could see was 20 years of history what it was really about, trying to heal a nation and bring the country back together and heal the wounds of

that nation. i want to close with one thing dad andthink speaks of ba this idea, the world become so competitive we have to win at any cost. dad took a yellow legal pad and picked about 20 subject that he thought were important to young man or woman growing up in this subject today, subject like what is character, integrity. this one is a learning how to lose. he bounded that book and gave it to all of us kids. i remember as the gunmen when he gave me the book -- as a young man when he gave me the book. he said these are some of my core values, and this is the copy of one of the pages, on learning how to lose. you can see it is hand written. i remember when he came to me, i

was not as impressed as i should have been. [laughter] when you are that age, it goes above your head. he said steve, i want to be accountable to you guys. 18 years ago, when i was going through my alcoholism, and i picked up this book with his writings on these 27 it's about character and integrity in things like that, core values, it was one of the things that helped save my life. i was living in some unethical areas. it was one of the tools i use, his wisdom, to get up off my knees and reclaim my life and get sober. i am going to read one of these to you and then i will turn it over to victoria and the rest of the group. there is some great wisdom in this. he title did "learning how to lose." in this highly competitive society, there is always a

winner and always a loser. even the best sometimes lose because of circumstances beyond their control or because of unintended mistakes. but to walk off the playing field as a sorehead with the public display is not good for one's conscience or what for one's reputation. losing should be looked upon as a lesson so you can do better the next time. disappointment should not rattle once composure, sidetracked a well organized plan, or preclude another effort. barring to lose is to recognize that one set back is not the end, but reality that can be a new incentive to reach and achieve higher goals. a lot of wisdom there, and i think thought like that pertain to ethics, how you live your life. you don't win at all costs, you don't cheat, you don't break the rules. we live in a society today that demands a lot. you look at baseball and

steroids and all these things. there is a lot of pressure on young people and young adults. we have to ask ourselves the question of what we should do, what we ought to be doing. dad told me one time he was at a talk -- billy graham had spoken, and he and billy graham were talking afterwards. i don't think i quite understood it when he said it, but i think i understand it better today. billy graham was telling dad, the greatest challenges before us are not going to be medicine, technology, and finances and things like that. the greatest challenge is going to be taming the heart. the tame the heart, i do think you have to look at these things, these ethical questions of what is right and what is wrong. i thank you, you are a good

audience. i loved the discussion and the back and forth, and at this time i would like to invite victoria up here and we will hopefully have a lively discussion and be the town square for grand rapids today. thank you all very, very much. [applause] >> we are very fortunate today to have with us three outstanding leaders to explore and discussed the role of ethics in shaping and regulating our society. and the question of whether america still has more integrity. each of our panelists will speak for about 10 minutes, and then will entertain your questions. our first panelist who will speak today is brigadier-general michael mcdowell, the former

deputy assistant secretary for homeland defense strategy. his duties include supervising the departure of defense critical infrastructure protection program, the global anti-terrorism protection policy program, and serving as the liaison from the department of defense to the white house and congress. in 2003, the michigan governor appointed him her advisor on homeland security. general mcdaniels recently joined khalil law school where he will develop a program and homeland security law. he has a master of strategic studies and a master of arts and security studies from the naval postgraduate school. general mcdaniels has been a member of the michigan national

guard for 24 years. our second panelist today is terry lynn land. she served as secretary of state from 2003 to 2010. an advocate of voting rights, she parted disability advocates to implement the first boating equipment designed specifically for people with disabilities, and to ensure that local polling places are accessible to disabled voters. the michigan rehabilitation conference honored her with its 2006 s look to excellence award for these achievements. she expanded online services and reorganize the branch of the structures to better serve michigan residents. in recognition of her success, she was presented with the distinguished leader award by the michigan business and professional association in 2007. an honor given to women who have demonstrated successful leadership. she is a graduate of hope college and was awarded an honorary doctor public services

by central missing in university. our last palest is filling in for tony jenkins, the state bar association president who unfortunately fell ill. we are happy to have with us today the vice-president of the state bar of michigan, who will serve as a president beginning september of 2012. he has practiced law for 22 years and is a partner in the grand rapids firm of roseanne mckee -- rose and mckee. he is the recipient of an award given to one attorney each year by the state bar of michigan in recognition of outstanding pro bono contributions to michigan citizens. he has served on the board of directors for the grand rapids aid resources, has been named as one of grand rapids top 40 under 40, and has been designated a super lawyer every year since

2006. he earned his law degree from the university of michigan. please welcome our panelists. [applause] we will began with the general. >> thank you very much. it is great to be here, distinguished guests, mr. ford, my colleague from the collegiate law school. i really appreciate this opportunity. if i could take one moment to interject a personal moment, mr. ford, i greatly appreciate your mentioning about your father's career as a boy scout. i can tell you that in the late 1970's when i was awarded my eagle scout, it was certainly considered sort of square at that point as well. having as our president the only resident of -- recipient of the eagle scout award meant the world to us at that time. i appreciate you mentioning that.

that love of scouting your father exhibited right up until the very in, it was very heartwarming to be president -- to be present at the funeral procession and see all the boy scouts lining the streets of this great city. thank you all. i want to talk about the concept of whether there is in fact a separate ethnic for the american public. do we have a separate ethics for this country? i think it differs, depending on each country. i submit that we do in fact have an ethic, that it continues, and is based in our constitution. i would suggest to you that this is certainly not a new concept, and the first decision that every law student reads, marbury vs. madison. chief justice marshall specifically referred to the of the office, to support and defend the constitution of the united states that every judge

takes. if you look at article 4 of the constitution, it is not limited to judges. also talks about the president and members of state legislatures. talks about every member of the judiciary and executive office of the several states. it is intended by our framers in the constitution that all of our public officers take that oath to support and defend the constitution. this is really of no small moment, because it impresses upon you when you take that oath not just the august nature of the position, but more importantly, the responsibilities and where those responsibilities are grounded. as an attorney, as an assistant attorney general, as an officer in the u.s. army, as a general officer, as an assistant attorney general, i recently was three sworn into the michigan national guard last month, and

each time i took an oath to uphold and defend the constitution of the united states. so i think that oh, and an oath is much more than a promise, is a covenant with a higher being, a covenant with your god, whoever you believe him or her to be, that you are taking that solemn oath to defend the constitution. how do i get from that to a public ethic? there are two sort of themes there. one of them is not unique to the united states. that is the one contained in the preamble to the constitution, where it says to promote the general welfare. certainly given our history at that time, we were throwing off the ties that bound us to the king. we are transferring sovereignty from the king to the people. we were transferring ownership of property generally from the king to the people. there was an understanding of

this collective welfare, this collective self interest, if you will, and the need to promote that general welfare. some would suggest that is one of the two-lane the akaka, paula in america. the second one is not unique to this country, and that is the idea of protecting self interests. it is perhaps more subtle, but it is definitely as fundamental to the constitution. the framing of the constitution is not simply democratic, it is not majoritarian, it was a federalist system as well. there was the idea they were protecting the small state and the individual. it created a community as it created this checks and balances, and they were ensuring the interests of the individuals would not be lost. that was very important to the

framers, for individuals and the larger states. i think those are always in tension. there is as dynamic between them. that is the part that causes, as mr. ford said, this pendulum to swing it, this dynamic, or sometimes there is more interest in this office interests of individuals, and sometimes there is a collective interest. because there is no black-and- white. it will always be this great area. -- it will always be this gray area. last week, the supreme court ruled that the westborough baptist church has the right to protest investment fashion -- at the hem that fashion at military funerals. i can tell you that there is

nothing more somber, there is nothing more important to this nation that we recognize those individuals who sacrificed in support of that constitution and in support of all of us. and yet the constitution does permit that because there is that tension between the collective interest and self interests. no matter how a port, no matter how detestable, we have to protect that speech. we certainly could permitted to be 1,000 feet away and guarantee other things, but we have to recognize that speech as well. there is that constant tension between these values. both of those values, i would submit, are ones that we have to be told. -- we have to uphold. an example from 150 years ago, the tenants stephen decatur said

at a dinner, he stood out and gave the following toast. our country in our intercourse with foreign nations, may she always be in the right, whether our country is right or wrong. i think that is something seized upon by jean lewis and self- proclaimed patriots, -- by it jingosits. john quincy adams, responding to that, having heard about that toast, and a letter to his father said that he could not join his voice in that post. he said i cannot ask of heaven's success because where she would be in the wrong. let justice be done, though the heavens fall. that is a phrase i have often used.

let justice be done, though the heavens fall. the reason for that is it strikes me very similar to one of the key lessons we learned at army war college, which is the mandatory schooling that every officer has to have before they begin getting considered for general rank above colonel. that is it that you have to be able to throw your stars on the table. you have to be able to give up your rank, everything that you held dear your entire career, to do the right thing. exactly as mr. ford said, talking about his father's decision to pardon nixon. he knew that decision politically was going to be devastating. so every army officer is taught these days you have to be willing to throw your stars on the table. let me give one example of that. in the time after september 11,

2001, over 400 individuals were in turn at guantanamo bay. there was a question as to who was going to represent these, army, air force, marine jags we re all signed as rigid all assigned to represent them. you had osama bin laden's driver. he said i went from doing drunk driving cases and positive drug tests to one of the most highly visible court cases in the nation, if not the world. they rose to the occasion. they sued secretary rumsfeld in federal court on the grounds but that the military tribunal was not following the constitution and geneva convention. they were, in fact, correct. many years later, after several

years of getting the case to the supreme court, justice john paul stevens wrote the opinion on behalf of the majority. consider again, justice john paul stevens, to bring this full circle, the one supreme court justice who was appointed by president gerald ford. i think similar interests, i think similar character, certain similar integrity must have existed all the way through. as we heard mr. ford said earlier tonight, it was an understanding of the need for integrity in that decision. the sense that no man is above the law. that was certainly true as well in the opinion by justice stevens, as he specifically said in the opinion that individual rights and national security have to be upheld -- but may find it.

he said, "the executive is bound to comply with the rule of law in this and every jurisdiction." in closing, there is always an ethical question. every ethical question, if you will, will devolve down to the simple calculus -- to what extent does the general collective interest prevail and to what extent do we allow the individual's interests as well? >> thank you. >> thank you, it is great to be here at the gerald r. ford museum and library. i was born and raised on this side of town. to have the opportunity as a high-school student to actually work on a presidential campaign, it was not until i was older it that i appreciated what i had with that opportunity.

i started out wanting to be a teacher. afterwards, on the campaign, i decided i wanted to do this. which was how you run for office and had you get elected, how you make decisions, what you can do. i am up here being the practical person, not a lawyer. even though i was a court clerk for kent county and served on the grievance commission, i understand how lawyers work. but i think what i will bring to this is the practical part of this. that comes in with how you make decisions and how you get this information. as county clerk, i talked to anybody. if you want to have a cup of coffee with me, we could talk. nobody was buying lunch, nobody was paying for a conference, but we do need to talk to everybody. i believe in government to make good decisions, you need to have

conversations with everyone. president ford was of that mind, that he wanted to hear all sides. my staff meetings as secretary of state or always engaging, the word i like to use, because i had folks who have different philosophies, conservative, liberal, government experience, business experience. that created a lot of dynamics and allow us to make good decisions. i thought i would first give you of how we make decisions and come to conclusions dealing with the influences. that is a challenge because now the technology as part of our lives and yet get bombarded on cable, facebook, twitter, you have to make sure you are getting the right information, the correct information to make decisions. you are dealing with taxpayer dollars and people's lives and families, so it is really

important that you really look into the information that you get and make sure that it is good and accurate information when you make those decisions because it affects a lot of people's lives. on the election side, we have a newsletter, and there was a survey to find out how people thought about ethics in michigan and government, the campaign finance side. in michigan, would like to say that we have no ethics. what i mean by that is we don't have the same type of procedures and rules as far as running for office and declaring your income, stock, and holding she may have like congress does. i explain to people in michigan is different. we are unique. we have one industry that demonstrates our state. -- that dominates our state.

the matter what income you are at, you have gm stock, ford stock, chrysler stock. it would never appear to anybody to announce that because we are all about the automobile. in other states, were you don't have that one industry that bowman states the whole entire state, they looked at it differently. if you have gm stock and you go into the legislator and evoked -- and you vote on something that affects the automobile industry, people say, he should denounce that. -- you should announce that. those kind of issues were never brought to the forefront. just to give you an idea, the poll asked people if it made a difference if they fully disclose their sources of income like sources of congress, and only 40% of people in michigan

thought it was important. in fact, they also asked, 50% of campaign funds come from lobbyists, is that important? 20% thought it was important. you go down the list of issues, and it boils down to 18% as far as campaign finance and public financing of candidates. in michigan, we have the ability to public finance the gubernatorial campaign. every year, less and less people contribute to it. now it is 18% of the people who think that is important anymore. it is interesting when you start talking about campaign finance, but the reality is most people don't think of it as a problem. we have transparency in michigan, which i think is important, and as long as you get a contribution, you need to be up to let folks know what it is. when i was secretary of state, i

had legislation i put forward -- i was not successful getting it passed and signed by the governor, but what i wanted to do was have real-time campaign finance reporting. if you've got $100, before you could spend a, you had to put it in the bank and declared on a website and real time and everybody could see that you got $100 from joe smith. right now, people play the game down theey don't put their ow contributions until after the election. this way you know ahead of time, within a month the billboard's go up, the yard signs go up, no campaign contributions coming in, right away you could go after that and to the public would know they have to disclose their contributions. that is one of the things that i put forward. it is still out there.

i think transparency is the biggest issue. people just want to know where the money is coming from. the reality is, like the polling numbers show, it does not make a difference how much, it is just the transparency that people seem to want to know. then there are a few other things that we deal with, that i dealt with at the secretary of state's office. there was a big discussion about having polling places accessible to folks with disabilities. there have been a lot of conversations about it would cost too much money, we cannot afford it. well, if it is the right thing to do, you should do it. that is why we went ahead and did that when i was in the secretary of state's office, improve polling places because it is just right. my favorite story from that whole process of modernizing the elections in michigan was the woman who was sight impaired all

her life, never able to vote. we put the new machines in, she went into the polling place, put it by herself for the first time, 65 years old. she stood up in the middle of the polling place and said, but " god bless america." that is what is all about. making it accessible, having it transparent, and that is what government should be. that is my presentation. >> thank you. [applause] >> i guess i get to bat cleanup. first of all, thank you for the honor. it is an honor of being involved with anything involving gerald ford's name. he was definitely a hero. i was asked to focus on legal ethics. the first thing i like to point

out is that is not an oxymoron. what does that mean in this context? i was told once at that ethics involves being unethical person and someone who always does more than what is required but less than what is permitted. in the legal context, that is true. in the state of michigan, the bar association itself regulated. that means the discipline system is run by the lawyers, with ultimate oversight from the supreme court, but all of the attorneys are members of the state bar, it is self policed. i came up with some statistics. are trying to figure out, ethically, how are we doing in the state of michigan? into this one, there were 34,000 members of the state bar. that year, there were 3500 request for investigation, which means basically 10% rate of

infection. -- rate of incidence. in 2010, there were 41,000 members. only 2800 requests for investigation. that would seem to indicate we are doing better ethically. that runs contrary to what one would think. i think we have to focus on a few things. one thing i would urge you to consider, there are a lot of challenges going on right now in the legal profession that impact the way we do business and pressures that are on us as lawyers . in today's world, as we're becoming more high-tech, more fast-paced, less personal, no face-to-face skin medications, -- no face-to-face communications, i think there is a change in society, including

the way we practice law. i feel very fortunate to be practicing law in the state of michigan. i want to focus on a couple of factors that i think really affect what is going on in the legal business right now. the first is the slowing economy. martin luther king once said the ultimate measure of demand is not where he stands in moments of comfort and convenience, but where he stands at times of challenge. clearly, anybody from michigan, you understand is a challenge economy. according to published reports, 20 years ago michigan had more than 104 corporately traded corporations in michigan. they came up with a michigan stock index, the top 100 of those companies. two years ago, there were fewer that 90 companies publicly traded in michigan. they don't even have a top 100 and more. the michigan partner of economic

labor and growth statistics are startling. we have lost 593,000 jobs since two dozen 3, 13.4% of michigan's workforce eliminated in that time -- since 2003. we are the only state of the 50 that has lost population in the last 50 years. excuse me, in the last census. what does that mean? i submit the impact on lawyers and law firms is predictable. first, there is a new term in the legal business, it is the on hiring of associates. that'll get fired, they get un- hired. there are also fewer jobs. you have grads' not being hired by law firms, forced to go out and become solo practitioners. nothing a dance solo practitioners, they're some of the best attorneys, but for a new attorney coming out, they

did not have somebody who has been there who could show them the ropes and point out the minefields they will step into if they don't watch out. the other thing going on is there are more lawyers being pumped out. when you think about the statistics about the declining employers based in michigan, but of jobs in michigan, you have more lawyers competing for fewer opportunities, fewer clients. the thriving middle-class has always been an important stable for lawyers. that is where we get a lot of business. in michigan nowadays, the middle class is not thriving. that impacts, again, the bottom line. the results are threefold, none of which is good. the first is you have young attendants -- young attorneys who did not have mentor ship cannot avoid problems. the second issue have more experienced lawyers who used have administrative support and now they're forced to be sold because of the economy.

we're seeing a lot of grievances filed against them just because they don't have the support staff and they're getting sloppy and careless. the third thing is the most experienced lawyers are still forced to fight at any cost to keep their clients because they are becoming less and less loyal. when you have a win at all costs mentality to keep your clients, that is when we see enron, that is when we see wall street, that is when we see lawyers who are trying to maintain their client relationship willing to do what it takes to keep the client, meaning they will turn a blind eye to things that normally they would object to. it causes serious problems. the second thing that really impacts us is technology and the increasing pace of a lawyer. when i started practicing in 1988, we had one computer in the

office. we had one plain paper fax machine. now fax machines are outdated. nobody uses fax machines. we all have our little funds were would get instant messages and email. and the clients expect that the consent a message instantly, they get an answer instantly. there is pressure on lawyers. it used to be if somebody said you lawyer -- sent you a letter, you have days to contemplate the issue, draft the letter, and said back in the mail. today, they call on the phone. we had a great story last week about the death of the telephone call. nobody talks on the phone anymore. it is all the instant messages. olive to focus on criminal indigent defense. -- i want to focus on criminal indigent defense. many lawyers went to law school because of attica finch, "to

kill a mockingbird." he took on the case that could not be 1 and fought his best. that is what we all wanted to be when we grew up. recently in the state of michigan, there was a national study to show the state of michigan is failing to meet its constitutional burton's to provide free legal defense for criminal defendants. unfortunately, that is something that has to be addressed. in today's economy, how you pay for that? that is another issue we have to address in the short term. by and large, criminal defense attorneys are modern day john adams. by that, i mean, john adams actually defend it a british shoulder accused of murder -- actually defended a british soldier accused of murder which sparked boston tea party. he thought that was more important that one guilty man

might get off -- excuse me, one guilty man out of 99 might get off rather than have an innocent man convicted. the shoe is on the other foot, the prosecutors. most of the prosecutors in our society are devoted civil servants who really try to see that justice with a capital "j" is done. but one side or the other inevitably slips, and believe me when that happens, we hear about it front page. you're about criminal defense attorneys getting paid in something other than money, were the prosecutor -- or the prosecutor, like ted stevens, one of the prosecutors in that case committed suicide after he was accused of unethical behavior. it happened in detroit in the terrorism trials, where they were accused of prosecutorial misconduct. things like that can happen.

when they happen, it is the reaction among us we realize the person without is superman is really just clark kent on steroids, to use the baseball analogy. and that hurts. michigan is a great place to practice because the economy has not had as bad as others. there are fewer attorneys here. it is a small bar association. there is a collective reinforcement of our professional ethics. we really look at each other. we run in front of the same judges. if you cut corners in front of a judge wants, they will let you remember it next time. that accountability is crucial to why i like to practice in michigan. wrapping up, and this goes a little to what mr. ford said, when i was asked how i

conducted myself, why i conducted myself a certain way, i used to say my guiding principle was i did not want to do anything that would embarrass my parents. now i have a daughter who was a freshman at u of m, which pleases me beyond anything. with that perspective now, i live my life so when my daughter thinks of what honesty and integrity means, i want her to think of me first. i know we have some law students here. that is the parting shot, that is the way to conduct yourself. thank you very much. [applause] >> alright, we will entertain your questions. please pass them along. my understanding is the first question is coming from mr. ford for the panelists. >> yes, the question for anybody

on the panel. one of the most important things you said is how technology has changed our society. i would ask your perspective, both technology and pop culture, because we some what isolate ourselves, not person to person, not face-to-face, how does that affect going deep enough to even think about ethics as opposed to saying, well, it is my own personal opinion? >> i guess that is something i brought up, so i will take the first crack at that. people say things on the internet they would never say face-to-face. i think that -- ethics is the golden rule. if you are seeing somebody face- to-face, you will treat them in the manner in which you hope to be treated. when we are so reliant on technology, email, instant messaging, or you don't make the

personal connection, that inevitably leads to a greater sense of me versus we. as far as pop culture, i think pop culture tends to glamorize those who are out of the dorm. people who are getting away with things are all over the news. you know, the teenage mother shows -- if i were to mention teenage motherhood to my mother when i was in high school, i would have a bar of soap in my mouth. i do think we have to have a serious discussion about keeping that in checked and making sure that people realize, that is not the norm. that is the aberration. >> in politics, your word is your bond. that is important. what technology has done is made

it tougher. you are more cautious than he used to be. when i first started getting e- mail in government, my answer on my e-mail was yes, no, thank you. because you did not want to say anything that would go viral. i modified and a little bit, but still, unfortunately what it does is it makes it hard to make decisions, because you don't get all the information. also, with constituents, it was dealing with those folks and answering their issues. one on one, you talk more, you have more nuanced and what you are saying to help people get to a decision, help people understand where you are coming from. i think that has hurt that. i still try to do face-to-face. i am back on that, when you are making a decision, you have a group of folks together and have to make decisions and go forward

as a team. technology, too, has changed. there is just so much of it, and consistency on what you say is huge. i feel for some elected officials because they said it one way i thousand times, and then the newspaper reporter got them a little off and then there they are. even though they set it up thousand times one way. that is the challenge out there because your word is your bond. >> if i could give one short illustration. about six months ago, a civilian was quite upset. he had just got a phone call from the times of london. they had figured out based upon the documents put on wikileaks where he was over in iraq back in 2004, and therefore were attributing certain behavior to them based on knowing what the

incident reports were. this war, unlike any other war that would have prosecuted before, any time you leave a forward operating base, go outside the wires and have some kind of contact with the enemy or civilian, you have to do the equivalent of a police incident report. all of those were classified to protect the civilians and our own soldiers. thousands of those were on the wikileaks. it did have a lot of intelligence dahlia? not to an outsider, but here was this individual and his behavior, because they were able to figure out who he was because once upon a time there was a favorable story about him in the washington post, they took what they knew about him, the took the document on wikileaks, the combined them, and they made certain assumptions which may or may not have been correct, assumptions about this soldier who had served his country honorably and had to make quick

ethical decisions in a very adverse environment, and now they were trying to make him a public figure as a result of that. that calculus, that tension between the collective good and the individual could has not caught up with technology we have. there is still too much focus on individual self interests, and the collective good in this case has not balance that out. >> the next question for you, general mcdaniel, along the lines of balance between common good and personal good. the first question is a statement, actually. portions of the original patriot act seem to at times overstep our citizens' rights. how would you respond to that and how has the balance been struck with that legislation? >> it should be noted that some of the most controversial provisions of the patriot act were up for renewal.

the controversial provisions were a result of the fact congresses trying to get that through very quickly in the days after september 11, 2001. they sunset those provisions. they have come up for renewal on a couple of occasions. those have to do with the library, roving wiretaps. of those controversial provisions have come up to congress on a number of occasions since then and there has not been the debate we need to have. again, there is that tension where they're trying to say, what is the balance, and congress is still struggling with that, which i think is absolutely appropriate under the constitutional system. >> ok, this is a question for each panelist. what was the most difficult professional and ethical challenges faced? what guided you? >> wow. [laughter]

i am not sure i have the courage to spring forward. one of the earliest was one of first started at the attorney general's office in michigan, and frank kelly was the attorney general, as he was for almost 40 years at that point in time, one of my earliest mentors. we had a lawsuit where it was necessary -- i was in the environmental division, it was necessary to sue five cities and macomb county because of ground water contamination and it went into the drinking wells of some of the citizenry. there responded in part in a political way. i was called to frank kelly's office. i go into the conference room and there are the mayors of all five cities and their state reps and centers.

-- and senators. frank kelly comes in, taps me on the shoulder, does not say anything to me. they go through, chewing me out, in essence demanding this lawsuit brought by the government against the government does not serve any good purpose and our efforts should be spent elsewhere. frank kelly heard them all out, just looked at them and said, you know what, you stay the hell out of the judicial process and i will stay out of the legislative process. if you have any questions, mr. mcdaniel what answer them. -- mr. mcdaniel will answer them. [laughter] i will not tell you the response of some of the representatives, but my point is you will always have that decision as to where you were saying, am i doing the right thing. few of us will be in the position that mr. ford mention

his father was, where the decision is ultimately his. most cases we have a mentor to rely upon. you will have that ethical dilemma. have your mentor in place and make that decision based upon what is right and what is transparent for your client and for yourself. >> you have to live with yourself. that is the bottom line. not quite as specific as what you said, but on a day-to-day basis, when i was secretary of state, i had a republican and democrat governor, and on a daily basis, there was given take between these branches of government to make decisions. it is the part of the compromise, but you have to make sure when you are compromising you are not compromising yourself. there were a lot of people -- i will not name them, because that

will not work -- but there were a few within my party even that were insistent upon what they wanted. you have to keep that up, knowing full well that my budget would be looked at very closely next year if i held out of a certain issue. i said, well, my budget is pretty good and i won't worry about that. the reality is the next year it or not and a legislator. -- they were not in the legislature. you cannot make decisions on it -- i will call it a threat in the future, but you have to make a decision on what matters now because the future can change, let me tell you. i have worked with a lot of candidates and newcomers. i remind them that what happens today may be so different tomorrow, so don't worry about that. but decision based on what you need to stay. any process we have so many

people at play, that is important today, because the next day can be very different. >> as a practicing lawyer, i take very seriously my role as an officer of the court. i think it is critical as a litigator who goes before the courts of the time that the court has to know what i am telling them something, they can count on my word. with that introduction, ran into a situation that i am sure all the attorneys have run into, but at one point it hits you in the face and it is a jolt. i was representing a woman -- actually, it was pro bono basis, she was having her house foreclosed upon. absolutely believed her 1000% of what she was telling me was true, that they had forged her signature on these documents, it was not her signature. felt so sure about that that i hired an expert out of lansing,

former fbi agent who came and took writing samples from her, sent them back. he came back to me and said, well, got good news for you. i said, what is that? he said, you won't have a pro bono case much longer. he told me based on his analysis, he was certain that was her signature. given that, i cannot in good conscience go before the court with it. i ended up having to withdraw as her counsel. we had spent, the firm had spent a lot of resources on that file. i had invested a lot of personal time, and i am somebody who commits to my clients. that was a very difficult conversation i had to have with her. but absolutely the right one. >> another question, compound question for each panelist, is there a decline in mutual

respect and ethical behavior in american society today? and if so, what accounts for this decline? and how can we address it? >> i thought a bit as of trying to, out what my definition of ethics whether it was the behavior of the states during the articles of confederation, what they're it was the political climate when andrew jackson was elected and the slurs towards his wife, whether it was the state of the country with the rutherford b. hayes and that disputed election, whether it was more recently with the red scare. or as mr. ford said, with watergate. it is hard to say this is the worst of times. i really sort of reject that if

we look at this country on an historical basis. we are incredibly resilient as a people and as a nation because of the way that our founding documents, the way the constitution was awarded. -- was worded. if anything, having thought about this the last month, if anything i came away somewhat reassured. it is so easy to pick examples because we have so many different media sources. it is to the point where every individual, to build upon what bruce said, everybody has their own iphone and can create their own media. instead of having the three networks, we now have 300 million networks potentially. as a result, we are bombarded with bad news and good news is somehow filtered out the way

that spam used to be. i refuse to believe that we have lost civility compared to before. i think if anything, is just a swing of the pendulum once more. >> i agree, i know that it has changed. in this campaign meetings back to 1976, everybody was yelling at each other. it is not very simple. there were no tv's and we all walked out and smiled afterwards. what has changed is technology. by comparison, watergate, breaking into a campaign headquarters and stealing files to find out what the opposition was doing. what is the difference between that and governor palin and her e-mail attack? that is the same thing. a young man broke into her e- mail to find out what they were doing it in the campaign and what was going on. but is the difference between

that and breaking into headquarters? it has not changed. that is just the technology. i was on the detroit economic board when president bush would give a speech a while back, and they left his speech in the room. he went off to a private reception, when it went to get the speech, a major speech on the economy and manufacturing, weeks before he gave the speech. it was leaked. it still happens. it is just it is a little different. we are all human and i think that will always be there. >> i am very pleased to say that con i run into unethical, tha nduct, is still shocks me. i did not have a month to prepare since tony just took ill, palin had a couple days, but i'm a history major,

undergrad. i agree, there were some battles hard fought along the way, and i can across say quote from mark twain, "it is curious that this will courage should be so, and the world and moral courage so rare." mark twain died in 1910. this debate has been going on at 100-some years, and i think things are not as bleak, but i am a half full kind of guy. >> every older generation bemoans the ethical behavior of our youth. the you share that concern, or do you behold ethics in our youth and why? >> that i share that my daughter is the most ethical person? [laughter] because she knows if she runs

afoul of me, i have learned things from my italian grandmother. no, our kids are struggling. part of it goes back to pop culture. the role models that they're seeing broadcast on tv i don't think reflect what we want them to see. i think it is more important than ever for parents to set the guidelines and be good role models and have conversations a lot earlier than i know my parents had to have with me. but i think our kids, i am on a nonprofit board, where we deal with urban students, and we expose them to fine arts and technology. the kids that i meet over there have the worst backgrounds that he could imagine, -- that you

could imagine, and i never come out of that building without being uplifted. they renew my hope, and i am very confident in our youth. >> one of the things i have noticed in the younger ones is i don't think there is a lack of moral values. the parents have done a pretty good job with that. it is the cutting of the corners i find interesting. i come from the old school, do it all, did it right, get it done. i think technology is part of that, but a little more of that. what i find has been most interesting, just a little more of that, the shorter way around rather than the long way. i remember when i was younger you started at the bottom and work out, did all of that. there is not so much of that anymore. it is like, let's go to the top

right now. in doing that, you did not gain the wisdom from the years of experience. not that some people cannot do that, but i think that experience and that relationship, and that you worked at it a little bit and understand how it works is important. that is what i see as more of a challenge. >> briefly, same answer. we have to have the institutions in place. is the boy scout oath, the boy scout law. if those behaviors are being taught as an -- at an early age that to become inculcated as the basis of those individuals. >> one final question. we will start with you general mcdaniel. >> absolutely. to maintain our moral place in

this world, as that nation on the shining hill which we like to perceive ourselves as, we have to be not only moral as an individual but moral as a nation. we have to have that very reason that debate before we make decisions about the use of force in countries like libya. just like we could have had greater debate and some of the other recent incursions. i remember well the reaction of my colleagues and military leaders when decisions were made for a quickly to go into afghanistan and iraq. when you commit this nation's blood and treasure, that commitment has to be of the entire nation. the people of libya, i believe, are looking for democracy. they will model themselves within the extent of their culture after the net states.

but it is not because we are a nation of military force, it is because we are a nation of democracy and moral values. >> well said. i guess i would just agree, you have to reflect on why you are doing this and make sure that you understand what the reasons are. it has to be a total commitment, and it also has to be a world commitment. we are on a world stage, so have to talk to war fellow countries and make sure we are on the same page. we have to talk to our fellow countries and make sure we are all on the same page. sometimes you have to make this tough decisions and is a challenge, but we are in these times now and that is just what the world is about now. >> i think that question wraps up the discussion perfectly, because it is only when you were

forced to face the evil, when you are forced to face a bad choice that you have the inner debate. my mom always used to say, if you go to bed with dogs, you are going to wake up with fleas. that is the debate you have to have. whether it is dealing with a despot, whether it is dealing with a political opponent who wants to take advantage of some leverage that he or she perceives, or whether it is dealing with an unethical lawyer, you cannot bowed down engage in behavior which you yourself would condemn. >> alright, thank you very much. mr. ford has closing remarks for us. [applause] >> what a fascinating debate. we could go on for hours.

i think you for being here. dad would be so pleased today that this was the town square and we got to speak to things. i speak to lots of kids around country, talk about my alcoholism, the pitfalls, the choices, the decisions. i don't have any children of my own, but i know my girlfriends to kids who are teenagers, instant access. there is no delay in gratification. it wears away. i think we as adults are the biggest -- dad would say the same thing -- we need to teach them, we need to plant the seeds. the seats that we play today about ethics, character, integrity, leadership -- this is not partisan politics. it is ethical behavior. plant the seeds in those kids

today and we will see a harvest later. my old agricultural instructor used to tell me you cannot stick crackly seats in the ground and expect to see corn next. you cannot stick broccoli seeds in the ground and expect to see corn next spring. our biggest commitment has to be to our young people. thank you all very much. we will have a reception in the lobby afterward. thank you for being here and we're very grateful. thank you very much. [applause] [captions copyright national cable satellite corp. 2011] [captioning performed by national captioning institute] >> president obama has begun a trip to latin america in part to strengthen economic partnerships

in the region. in his weekly address he talks about the need to open additional global markets to u.s. exports to create jobs in the u.s. then the republican address. she discusses the need to rein in government spending to address the national debt. >> in recent days we have seen turmoil and tragedy around the world, from change in the middle east and north africa to the earthquake and tsunami in japan. as i said friday, we will work with our partners in the region to protect innocent civilians in libya and hold the khaddafi regime accountable. we will stand with people of japan in their greatest hour of need. as we respond to these immediate crises abroad, we also will not let up in our efforts to tackle pressing ongoing challenges -- depressing ongoing challenges to our country, including accelerating economic growth. that is why i will be in latin america. one of my route reasons for the trip was to strengthen the

economic partnerships a broad to create good jobs here at home. but america is a part of the world where the economy is growing quickly. as these markets grow, so does their demand for goods and services. the questions is where they come from. as president, i want to make sure these products are made in america. when to open more markets around the world so american companies can do more business and hire more of our people. here is a statistic to explain why this is important. every $1 billion of goods and services we export supports more than 5000 jobs in the united states. the more we sell overseas, the more jobs we create on our shores. that is why last year and set a goal for this country to double our exports by 2014. it is a goal we are on track to meet. part of the reason why is the rapid growth of latin america. their openness to american business. we not export more than three times as much to latin america

as we do to china, and our exports to the region was in support more than 2 million jobs in the united states. brazil, the first up on our trip, is a great example. in 2010, american exports supported more than 250,000 american jobs. these are jobs in places like capstone turbine in california, which recently sold $2 million of high-tech energy equipment to brazil. another company is run at the center, a small business in charlotte, n.c., which sells and repairs tools for building cars and airplanes. it deal with the distributor and brazil have resulted in new sales and employees at that firm. and we can point to larger companies like sikorsky, whose helicopter sales helped sustain the large-scale work force in connecticut, alabama, and today brazil imports more goods from the net states than any other nation and i will be meeting with business leaders to decide

how we can create more jobs by deepening these economic ties. after brazil i will also visit chile, a country with a growing economy and increasing demand for american goods. our exports there are up 3 cutups at since 2004 and supports 7000 jobs in the net states. the exports are of 3000%. we have always had a special bond with our neighbors to the south. it is a bond born of shared history and values and strengthened by the millions of americans who proudly came from their roots in latin america. what is clear in an increasingly global economy, our partnerships with these nations is only going to become more vital. it is a source of growth and prosperity, not just for the people of america, but for the american people as well. thanks. >> hello, i have the great

privilege of serving washington state's third congressional district. i would like to begin by saying on behalf of the people i represent that we are thinking of the people in japan and praying for them as the continue to do with the devastation following last week's earthquake and tsunami. i have only been in congress two months now and i like to think about my job as the tale of two washington's. families are scraping to save more than they spend as the couple with double-digit unemployment, the rising cost of gas and health care, and other challenges. but small-business owners are working hard to stay afloat while struggling with uncertainty over what new regulation or tax hike the government is one to hand down to them next. meanwhile in washington, d.c., the powers that be have been listed an army of lobbyists to try to block even the most modest efforts to address our 14 trillion dollar debt. there also throwing a wrench into the gears of job creation

with regulation after regulation that just by entering the pipeline breeds more fear and uncertainty. as a result, our economy is not producing enough jobs, it is struggling. i was sent here to get this washington with all the overspending and over regulation of the way so the country that we know and love can thrive and prosper. right now, the new house majority is hard at work on eliminating regulatory barriers to job creation. earlier this month, the house voted to repeal the 1099 at band 8 and obama-care that will hamstring small businesses. hearings,holding common-sense reforms that give the people and say before the government tries to implement any costly job crushing regulation. we're also working to cut wasteful spending so we can send a strong signal that washington is going to stop using our small businesses as the banks and

focus on helping them get back to creating jobs. already we have cut washington spending by $10 billion over five weeks. this is real money, especially consider the president and democrats in congress originally suggested not a single dime in spending cuts would be had. of course we're serious about ending the uncertainty for job creators and our economy. we need to cut more. as economists have explained and many americans already know, is the private sector that creates jobs, and government overspending crowds out private investment. that is why last month the house passed the measure reflecting the will of the people that includes significant cuts and reforms in the way that washington, d.c., spends taxpayers' time and money. this legislation is necessary because last year when democrats ran both houses of congress they failed to offer a budget for the first time in modern history. the senate needs to step up and follow us in passing a bill so

we can prevent a government shutdown and support job growth by reducing spending. but today, the democrats in the senate have not passed anything. instead of offering a credible long-term plan, the president has stayed on the sidelines. if we want to get our economy back to creating jobs, we cannot drop our responsibility to rein in spending. we need to get beyond last year's best and focus on the full scope of spending problems in washington, d.c. republicans are determined to begin a dialogue about entitlements, and even the president's budget is silent. failing to address this means failing to address the debt crisis. that means more uncertainty for our small businesses who create jobs and more uncertainty for every american who counts on programs like medicare and medicaid. without reform, they simply will not be there for future generations, and that is not acceptable. .

>> over the next hour and a half we'll have remarks from former treasury official michael barr who says washington has collective amnesia when it comes to remembering the financial collapse. we'll also hear from david strickland and julie brille on what's being done to protect consumers from scams. this is 1 hour and 40 minutes. >> i'm steven brobeck director of the consumer federation of america. once again i have the privilege of introducing michael barr, a professor of law at the university of michigan. the last time michael spoke at a c.f.a. event was in december 2009. while serving as an assistant secretary in the treasury department. in this capacity he played a key role in developing the financial services reform legislation and was the administration leader in successfully advocating consumer reforms, most notably the

creation of the consumer financial protection board. for that contribution alone, consumers and the consumer movement will remain forever in michael's debt. we greatly appreciated the speech, even if it and all other speeches while at treasury had been written by someone else as he humorously noted at his going away reception. so we now greatly look forward to hing him express his own personal views in his own words on the subject of financial challenges facing american households. michael barr. [applause] >> thanks, steve. this shows what a wonderfully optimistic and naive person steve is. [laughter] >> he clearly doesn't know anything about academics and has never heard of the word "research assistant."

[laughter] >> so i'm going to do my best to give the speech that i came here to give, but i can't promise that every word in it was originally written down by me. but i believe all the words i'm about to say. i'm thrilled to be sheer with you again to talk about consumers and their challenges in today's economy. and when i was here in december 2009, we were in the middle of a very, very large fight to get the dodd frank act passed. and the consumer federation of america was a -- many of you in this room were steadfast allies of the president in getting that piece of legislation passed. and it would not be law without you. so i think you should all give yourselves a round of applause. [applause]

>> i want to talk to you a little bit today about where we've been in the economy, where we've been in the state of the consumer protection and some of the challenges ahead. and when you think back for a little bit more than two years ago when the president came into office, our financial markets were completely frozen, our economy was shrinking, we were facing the worst economic crisis that our country had endured since franklin roosevelt came into office. our nation was losing nearly 800,000 jobs -- losing 800,000 jobs every month. small businesses were closing their doors. home prices were in a free fall. in my view the president moved quickly and decisively to stabilize financial markets, reduce the widespread harm caused by the failed policies of the past, and restarted economic growth. and had he not taken such decisive action, undoubtedly the

recession, as brutal as it has been for so many families, would have been far, far worse. and although the economy is now showing signs of improvement, and many employers have begun to hire again, considerable challenges remain for many american families. now, when i was back in government we were focused not only on repairing the economy but also on the urgent obligation to fix the failures in our financial system that helped to triggerrer the recession, the recession that has cost american families and small businesses so dearly. the passage of the dodd frank act in my view provides a strong foundation on which we can carefully build a more stable system, a system that protects consumers and investors, that rewards innovation and that is able to adapt and evolve with changes in the financial markets. now, to be sure, the failures that led to the 2008 crisis had many causes. some here in washington, others

on wall street and some on main street. regulators did not protect consumers to the full extent of their authorities, which led to unchecked lending that trapped so many families. firms and investors took on risks they did not fully understand. legal loopholes and regulatory gaps allowed large parts of the financial industry to operate without oversight or transparency or restraint. and many americans took on more debt than they could afford. and many financial entities encouraged them to do just that. for the one in seven americans who live in poverty, the millions of americans who live in fear of falling out of the middle class, these times have been particularly devastating. these families were the least prepared to handle the shock of the recession. they had little or no savings to fall back on. and stood one medical emergency or one major unexpected car malfunction away from a personal economic crisis. when the crisis hit full bore in 2008, families found themselves

overleveraged and underresourced. what we know is that going forward american families are going to need to try and save a larger share of income and to borrow more responsibly. today many americans are rediscovering the importance of living within their means. they're building assets by saving more and paying down debt. and they're growing more careful about how they borrow and how they invest. these changes are necessary and healthy, and ultimately they will build economic security for many families and make our economy stronger and more resilient. now, one of the critical ways we can member promote their economic security is by making consumer financial markets work better for american families. we need to continue to learn more about the dynamics of these markets, including about individual psychology and behavior and the role of financial firms as they react to individuals and to markets. now, the evidence on consumer fall ability and on how firms

behave in light of this fastability can suggest a framework for understanding and thinking about what types of consumer financial protection policies might work best in different markets. it's helpful to divide consumer financial markets into two buckets, those where firms are neutral towards or have incentives for overcoming consumer fallibility, and those where firms have incentives to exacerbate those very consumer failings. for example, providers of bank accounts have incentives to help individuals overcome the behavioral barriers to savings. lenders, on the other hand, have incentives to exploit by ass that cause consumers to overborrow. and providers of all kinds have incentives to provide fees that are less salient for consumers or that take advantage of consumers errors in predicting their own product usage, late fees, over the limit fees and overdraft fees. the implications for policymaking in each of these two cases are quite different as well.

in that regard, it's helpful to think about potential market interventions as falling into two different categories, change the rules of the game and changing the scoring. changes the rules means changing what market participants do, while changing the scoring means changing the incentives, costs benefits of market participants to choose one practice over another. interventions that change the rules and change the scoring can be used in -- scenarios where firms have incentives to overcome or to exploit consumer fallibility. however, the two scenarios may require different approaches. in the scenario where firms are neutral to or have incentives to overcome consumer by ass, rule changing may be highly effective on its own. for example, the success that many of you know in promoting retirement savings through the use of smart defaults, automatic savings plans is a well-known example. in this case employers were at

worst indifferent to and at best inclined to increase employee participation in defining contribution plans. but in cases where firms have incentives to exacerbate by as ease, changing the rules may not be enough. in these cases firms will have incentives always to work around the rules and render them less effective. for example, firms may comply with the letter of disclosure laws but act to undermine them by discouraging consumers from focusing on and understanding their true context. those of you who are familiar in the mortgage context know that it's often the case that a broker will say, oh, don't worry about that a.p.r. that's that thing the government makes us put on the form. let's talk about the monthly cost. and in such cases, it may be necessary to change the way the game is scored to change the basic incentives, to make a real difference for consumers. so this behavioral framework i think has profound implications as the consumer agency and others think about how best to

promote financial access. and default and defining contribution plan would serve as a prominent example of how behavioral informed innovation can have a significant impact on the lives of everyday americans. but there's a need for a lot more innovation that is informed by the interplay of these consumer psychologist and firm incentives in much more market-specific contexts. i tend to think of the challenges in this area as being a variation on the three-legged stool. i think there are three primary ways we need to make progress in consumer financial outcomes for american families in making -- in helping families have greater financial stability. the first is in enhancing basic capabilities, financial literacy. the second is in promoting access that meets consumers' needs. and the third is in establishing strong protections for consumers. basic financial literacy is a necessary foundation for informed consumer

decisionmaking. but to be effective, financial literacy must be combined with improved access to suitable financial product and strong consumer protections. so let me say a few words about financial access. i think that's one area where financial innovation is sorely needed. innovation may have gotten a bad name in the financial crisis, but it's absolutely essential to our financial services sector. and it's critically important to meeting the need of low and moderate-income households. a growing body of research has revealed the financial access gap in our country is sizeable. the fdic has estimated that 9 million american households run banked and another 21 million are underbanked, meaning that they have a checking or savings account but are not well served by these accounts and rely on costly alternative financial services providers. one challenge we face in expanding access, financial access for low and moderate income americans is promoting

savings in the use of low-cost electronic payment systems such as accident cards. defaults, changing the rules may help in this context because the providers of savings and transaction accounts have incentive to alleviate consumer bee as. for example with respect to procrastination to gather deposits. however, defaults may be less effective on their own in this market as they are in the retirement context. the main reason for that is that cost to serve low income individuals with very small balances can discourage firms from serving low and moderate income populations. and in this context, the combination approach is needed. and may be necessary to change the scoring as well as the rules. such as by designing creative solutions that help firms serve these populations with sustainable products. treasury, for example, took an innovative approach to direct federal benefit payments that relates to these insights. treasury is responsible for making ongoing payments to 70 million social security

recipients and other federal benefit recipients, a and 15% of these individuals still receive their benefits by paper check. individuals who have an account can direct deposit. but individuals who are unbanked or prefer not to use direct deposit now receive payment on a direct express card. direct express is a card account platform offered by a bank according to requirements established by treasury, there are now more than 4.1348 federal recipient who have opted into receiving these cards which was launched initially in 2008. i think this is a prime example of the ways in which government can help make serving low and moderate income households more sustainable for providers -- allowing for more favorable scale of operations for the provider. treasury simultaneously is undertaking other efforts to improve the electronic delivery of federal benefit payments.

i should add often at the suggestion or i should say insistence of members of the consumer federation of america. for example, treasury established rules that better protect federal benefit payments from bank account garnishment in a rule that was just published. and treasury is enhancing requirements on the types of accounts that are eligible to receive benefit payments, including prohibiting benefits from being deposited into accounts set up for pay day lending type arrangements. as of this tax season treasury is piloting an initiative to improve tax administration by offering selected low and moderate income households the opportunity receive their tax refund on debit cards. think think will provide important evidence about how to take this program to scale and what works and what doesn't work. so that's an example of access. we neededcation, we need access, but we also need time prove consumer protection.

in an environment of weak and ineffective regulation, the tendency of some consumer financial markets to end up in races to the bottom as we saw so badly in the housing market is not likely to be overcome solely by informed consumers or better access. and let me give you some examples of what can be done in this area. as you know, the cart act which president obama championed and signed into law in may 2009, is an example of regulation written for a market in which providers have strong incentives to usher consumers into suboptimal choices, to rack up lots of late fees and to make up only the minimum payment each month. and most of you know that nearly 80% of american families have a credit card, and a large portion of families carry a balance of on their cards. before the act, americans were paying roughly 15 billion annually in penalty fees. the cart act in my view was

well-crafted legislation that come bind the requirement of common sense disclosure with protection from practices designed to make use of consumer fallibility for the benefit of the credit card issuer youer and to the detriment of the consumer. for example, the act banned unfair rate increases including rate indecrees on existing balances due to universal default clauses and retroactive rate increases due to late payments. -- including weekend due dates or due dates that change each month or payment deadlines in the middle of the day. and it ended the confusing and unfair practice of so-called double cycle billing. so i think this act is an example of careful kind of regulation using a variety of techniques that can be effective. there are important changes in the dodd frank act to the housing market, in addition to the creation of the consumer agency that i will talk about in just a moment. most people don't know because the act was extremely long that

it really fundamentally reshaped the rules of the road in the mortgage market. it banned yield-spread premiums. it changed the practices for hiding the bar on escrow and taxes. it eliminated the practice of steering. it provides that brokers need to decide whether or not an individual has the ability to repay their loan before they make them a loan. it reforms the disclosures under tila and resba. and it requires that secure itizers of mortgages retain skin in the game as a way of better ashrining incentives. so all of these change i think are going to make a fundamental difference in the mortgage market. the cart act and the mortgage rules in the dodd frank act are two examples of ways in which regulation can be used to better improve consumer financial protection markets, but they

have a disadvantage. they tend to lock in on the practices that were harmful in the past and provide some room for consumers to be abused in new ways in the future. and that's why it was just absolutely critical in the dodd frank act that we create a new consumer financial protection bureau. and i think the new bureau has provided us with a historic opportunity to build a successful regulatory structure for consumer protection, one that's designed to promote financial inclusion, preserve consumer choice and provide for more efficient and innovative markets for consumer financial products, markets that operate on a competitive basis of price and of quality rather than on hidden fees. before dodd frank let's remember our system was largely incapable of supporting a successful regulatory structure for consumer protection. fragmentation of rule writing, supervision and enforcement made it impossible to create a

comprehensive and well-calibrated consumer regulatory system. jurisdiction and authority for consumer protection was spread over many federal regulators who had higher priorities than protecting consumers. and banks could choose the least restrictive supervisor among several different banking agencies. a large number of nonbank providers escaped any meaningful supervision at all. and the bureau will for the first time now be able to provide the necessary mission focus, market-wide coverage and consolidated authorities. it will be an agency that focuses not simply on more regulation but on smarter, more key here end and respective regulation, regulation that is designed and implemented with an understanding for and respect of chris cal models but is not blind to the compelling insights on consumers decisions derived from behavioral economics. regulations that seeks to balance a consumer's ability to

find the most beneficial borrowing choices and a product provider incentives to hide that suitable choice on the other. i have to admit that what i find most curious about the voices of opposition to the consumer bureau and agency i remind you whose primary principles by statute are accountability, transparency, fairness and access, is that their logic rests on the premise that empowering consumers is somehow antithetical to free markets, that appear to be stuck in a debate that presumes that regulation and efficient and innovative markets are at odds. in fact, the opposite is true. markets rely on good faith and on trust and on fair dealings. markets require transparentity that reflects economic reality rather than distortions caused by misleading sales practices and hidden traps. and the discipline of the market requires clear rules. i want to thank you again for the opportunity to speak with

you today. you are all truly amazing. together you are building a stronger country. an america where hard work and playing by the rules means security for our families and hope for our future, where firms compete based on price and quality, not tricks and traps, and where old-fashioned virtues and falls of thrift are rewarded. thank you very much. [applause] >> thank you very much, michael. we have time for a couple of questions. >> hello. my name is carter dorery. i cover full time for bloomberg. i've heard a lot about you although i came into the job just after dodd frank was passed. it seems to me like this is a crowd that would like to know whether you would be interested in running the bureau if you had the opportunity. [laughter] >> i certainly think that people here would approve and they would love to hear whether you

are available for the job. >> nobody's listening. first off let me just say i'm thrilled we have such a thing as a full-time reporter on the consumer financial protection bureau. [cheers and applause] >> the only one, by the way. >> no. that's terrific. i am loving being back in ann arbor with my family and i love a wonderful two years in washington. so i'm happy to be where i am. >> hi, michael holt. first i want to endorse the idea that you should consider coming back to d.c. but i had a specific question. i was intrigued by the rule on federal -- the new treasury rule on federal benefits going into approved or accounts with certain specifications. how will that consumer says here's the account i want it deposited to. how will treasury ensure these meet the standards in the rule?

>> so there are two separate things. one is that account that treasury sets for deposits to go into. those are enforced because treasury sets up all the rules and exactly the accounts that treasury wants. there are the other accounts that people have their deposit put into. and in those instances in which the deposit account is other than what is permitted by the rule, we're going to have to rely on the first instance -- treasury would have to rely in the first instance on consumer complaints and information from the market. there's not a -- the part of treasury that is conducting this activity doesn't have direct arm of the law in the world to do that. now, once the consumer financial protection bureau is up and running, the consumer financial pro force a wide range of consumer protection laws and will be i think an incredible

additional partner at the table in shaping this market in a positive way. so short term relying on consumer complaints, and then going to the firm and saying you're not in compliance with the rules, and longer term the consumer agency is another avenue. >> the consumer federation of america and other consumer groups and those on the frontlines keep a track of consumer complaints, and historically auto sales and dealer practices rank number one. and as you know, the dealers got an exemption from the consumer financial protection bureau. could you comment on that? >> it's wrong! [laughter] >> i think you know obviously when i was at treasury we were fighting very hard to get auto lending included in the

jurisdiction of the consumer financial protection bureau for precisely that reason. it didn't make any sense to me that you could have a bank engaged in practice consumer -- governed by the consumer rules and an auto lender doing the same thing not governed by the rules. but that you could have as most often the case auto lenders packaging by getting consumers to take out loans on behalf of the banks who they sell the loans to and not be covered by basic consumer financial protection rules. so i thought i was a mistake not to treat auto lenders the way you would treat any other lender, that is to make them subject to the jurisdiction of the bureau and to make them come into conformity with basic fairness and practices in the consumer laws, and that practices as you noted -- and you're the expert in this -- the prices in this area are

atrocious, have been. lots of auto lenders do a great job. lots of auto lenders are completely on the up and up and don't have any problems. but where there are problems there are very, very serious problems. racial discrimination, overcharging, padding, failure to disclose, appropriately the fees involved, and it's a situation in which consumers are often quite vulnerable because they think they've made the choice that mattered to them, which is figuring out what car they want. and then they thought they did the other thing that was really important, which is negotiate a good price for the car. but it turned out they stopped working when all the action kicks in, which is how much you pay for your credit. and so i think it's a real problem. >> we have time for just two more questions. >> hi, michael. i'm margo saunders with the national consumer law center. >> and you need no introduction.

>> and i thank you on behalf of my colleagues and our clients for the tremendous work that you did while you were in washington. [applause] >> thank you. >> you didn't name one of the real victories in the dodd frank bill that treasury was largely responsible for, which was the remittance bill, which significantly provides protections for remittances sent by people living in the united states to foreign countries in an area -- this is an area which had no protections whatsoever and now has dramatically new and great protections. i do have a quick question. treasury has indeed done great things in regards to protecting social security and other federal benefits. you said a minute ago that treasury had established protections for accounts into which federal benefits would be deposited. and i follow this area pretty closeliers and i must have missed something because what i

have seen is the great new protections on garnishment, the good new protections for prepaid cards, the new protections or ongoing protections in direct express. but there a regulation -- >> i did mean the card-based accounts. so there is no general treasury rule in this area with respect to direct depositing into a bank account. now, the bank accounts themselves are going to be, as you know, completely covered by the the consumer financial protection bureau. so the rules and regulations that will come in that area and eventually in the card area more generally i think will have a more natural home in an agency that is set up to protect consumers. so i don't think there are going to be gaps in that regard. under minn's, bill, we're obviously thrill today get remittances into the dodd frank

legislation. i think it's an example of where research can really make a difference in policymaking. i'd been doing research on disclosure in remittances before coming into the government, both on my own and then with apple seed foundation that many of you have worked with. and i think that research helped us convince people that it was putting the energy into regulating into this area where they said before, oh, it doesn't seem like there's a real problem. i think people could see there was a real problem. and i'm very happy that it got in the final bill. >> hi. my name is pamela chance in the numerica foundation. thank you so much for visiting and creating or being part of creating c.f.p.v. moving forward what do you think is necessary to ensure that it fulfills the mission that it was envision today care for? >> well, i think that one of the things that we tried to build into the consumer agency directly in the statute was a

very strong role for public input and public accountability. so for example, the bureau needs to review its rules every five years and get public input on how it's doing. the rules that are out there. the agency is going have a consumer advisory council for public input. there are a whole bunch of transparency issues built right into the statute. so i think one thing you can do is make sure you're affording yourselves all the opportunity to give input into that process. i think a second thing is more broadly -- saying this to steve before coming up here -- there is almost a collective amnesia descending on capitol hill and in washington and maybe elsewhere in the country about the searing financial crisis that we went through two years ago. people kind of forgot we had it, forgot why we had it, forgot why we had to fix it, and are ready

to go back to whatever we were doing before. and i think that's really dangerous for the country. so i think groups like yours being able to go out and say publicly and to provide evidence of past and current and ongoing harms that consumers are facing are an important way of reminding people why it is that we had to fix the system before. because it was deeply, deeply, deeply broken. >> this brings us to the end of this session. our next speaker is here and waiting to speak. i'm sure michael another five or 10 minutes if there's anyone else who has another question, would like to ask him outside this room. please join me in thanking michael barr again. [applause] >> and the next session will

begin momentarily. >> we're going to begin in about 10 seconds. my name is jack gillis. i'm director of public affairs at the consumer federation of america. this morning it really is a pleasure to introduce david strickland as the administrator of the national highway traffic

safety administration. david began at ntsba in january of 2010 and quite frankly has taken on one of the most important complex and challenging jobs in america. fuel economy versus safety, the toyota challenge, reducing rollover deaths, drunk and distracted driving, regulating the largest industry in the country who produces a product that is responsible for more debt than injury than virtually any other product that we by -- death and injury. on top of that he's nursing back to health an agency that some would say has been asleep at the wheel for about eight years. an agency that has the potential to save more lives than virtually any other government entity. whoo! that's david. prior to his appointment, david served for eight years on the staff of senate's commerce science and transportation

committee and likely has worked with more than half the people in this room. as senior counsel for the consumer protection subcommittee he was a lead staff person on the oversight of -- the federal trade commission and the consumer products safety commission. he also served as lead staff person in the formulation of the cafe reforms in 2007, and in the reauthorization of nisa in the safety lou act of 2005. as you can see, he wasn't just the 101st senator, he was the 101st through 110th senator. his work in advising commerce committee members led to the inclusion of several important vehicle safety mandates, including the electronic stability control for every passenger vehicle. david has initiated safety reforms and funding increases for the nisa see the belt and drunk driving programs and was named congressional staffer of the year by mothers against drunk drivers. and while neither one of these schools were good enough to make

the mc, david is a graduate of northwestern and harvard law school. so with that i am happy to welcome david strickland to the consumer federation of america's assembly. [applause] >> thank you, jack. and i'm still bitter about the committee passing over northwestern. we deserved a bid this time! we deserved one! no. thank you. this really is a distinct honor and a privilege. i have had the privilege of speaking to thousands of people across america my past year and handful of months or so of service to the safety administration. but this particular group when i received the invitation from c.f.a., this was an absolute must do for me. i had the honor and privilege of presenting to the assembly about two years ago when i was still a senate staffer doing the legislative update when i think

the senate and the committee were still in the throes of the consumer product safety improvement act. and i know there is a number of people that i probably kept up late at night with strangle willed calls of desperation trying to get things worked out in that piece of legislation to reauthorize cpsc, which is another one of our sister public health and safety agencies that i'm so incredibly proud of. before i came down, i met with jack and rachel weintraub. and i was telling them a bit that it feels weird to be the administrator of the national highway traffic and safety administration. not that i don't think i'm comfortable with the role or my love of the agency, you know. i really worked with three agencies on an everyday basis for about a decade. and they were all like your children. there is no favorite. whether it was the federal trade commission, whether it was the

consumerd product safety commission or ntsa the and all these agencies did such a fantastic work in the way they served the american public. first and foremost were cpfc and ntsa trying to keep people alive. with the failed trade commission it is one sub a making sure people aren't cheated and screwed. so every day was a fantastic opportunity and challenge for me as a staffer. and i think working with many of you, frankly all of you and the agencies and the ngo's and the companies this that have been part of this assembly for so long frankly billed my ethos in term of how we look at safety and taking care of people. and i think that ethos has been even more deepened and blessed with my work with my staff at the national highway traffic safety administration. i'm happy that my deputy

administrator ron medford is here who is another alumnus of the consumer product safety commission and another proud warrior in the fight of keeping people safe and alive. and throughout his entire career in government service. and it really is for both of us as the two agency leaders to come to work every day with our portfolio. as jack alluded to, this job is really -- i tell folks and people think i'm being hokey about this -- but i personally think i have the best job in federal government. is i mean, i guess for me. i can only speak from my own experience. but it's the best job in federal government. i have the opportunity to work with fantastic technology, companies around the planet that are looking at ways to improve individual mobility. things that sort of enrich every american's life. the one thing that i know because i have anytime my car, people have personal relationships with their vehicles. there is nothing more personal than a car.

and the voice al exciting choice that you make at the dealership, trying to figure out what you want on the car. and then it becomes a tool and it's part of your life for maybe 10, 15, in some instances 20 years. and that part he's is fun. but then there's the people part of it. recognizing that while vehicles do have that connected, special relationship to every person -- and when you're talking about 255 million of them, the unfortunate circumstances of how many people lose their lives because of highway traffic accidents. we're talking about 34,000 people in 2009. so the joy and the excitement about the product and what it does and the freedom it's created for everyday americans also creates this huge risk. and frankly this huge tremendous loss of life and how we have to balance that as ron and my agency every single day. how we can get those numbers

down. how we can better use our authority and use our rulemaking ability and use our research. how we can better work on our behavioral programs, whether it's impaired driving or if it's fatigue or if it's wearing your belt or if it's speed control. it really is a portfolio of issues. and it's just -- twin cities nothing parallel to -- there's nothing parallel to it especially for a person that so desperately believes the need for the government to help support not only how people mansion their drive task and their safety but how we support the evolution of transportation and individual mobility. it's something that i see at my dex every day and i would love to say every moment has been joyous and stress-free. but you know something? i would rather frankly the team that i have on board doing the challenges of this agency.

because the staff is fantastic. they have done so much, and they are such true believers in what they do. it really is a fantastic opportunity for me and for ron to be at the head of this agency. now, i wanted to sort of talk about in general sort of -- i mean i guess a question and a notion of challenge, from us as a regulator and all of you that work so hard every day in consumer safety. and i've learned a lot this past year, specifically about safety culture in the transportation realm. and i thought i had a very active safety culture. when i've worked with bob adler before he became commissioner at cpsc, and about his perspective when he was there at the ground floor of the creation of the agency as a staffer and then came in and worked with david -- john liebowitz over at f.d.c. or before that debbie majoris.

all the folks that i worked with over the years from the staff and from the political leaders, you know, what it means about culture and how we could impart a better safety culture for everybody. and then i came to ntsa. and the interesting challenge that we face every single day, and as we work with all of you and work with the manufacturers is where we have to evolve safety culture, how we talk about sort of the next steps and what we do. not only as an agency but collectively as a country. i'll give you a little example of this. back in 1977, my father gave my mom a brand-spanking new 1997 lincoln continental mark v. i mean, big gun boat of a car! i mean, i remember the thing that my father showed everybody in our neighborhood and all my

aunts and uncles about the quad row tonic sound system. in the lincoln mark v. [laughter] >> i remember that lincoln had a little demo tape of -- actually it was an eight-track tape, i should say. demo eight track of elton john songs that were specifically tracked to show the quad row tonic angles of the car. and it was all this great stuff. and my mom and i in the car pile in. was i in a safety belt when i was riding the car with my mama? no. quad row tonic sound was great. long road trips. was i actually even sitting in the backseat of that car? i was up in the back deck in between the rear window. and you know that little back deck that was huge enough back there? i was back there, hurdling along in a car with my mama. and my mama had a lead foot. has a lead foot. i've tried to teach her the ways of speed control now that i am the administrator. it would be incredibly

embarrassing for the mother of the administrator to be getting speeding tickets. [laughter] >> so hopefully in georgia she is heeding my word and doing the right thing. i believe that she is. [laughter] >> but nobody thought that was wrong. you saw kids riding in back -- that back flat areas in cars all across america. nobody blinked an eye about it, right? today, what would you do if you saw an unrestrained child riding that way on i-395? a lot of you would all lose your mind and start honking. some of you all will call the state police and say, we've got a problem over here. but that's what i'm talking about in terms of the evolution of expectation and safety culture. and a lot of it has had to do with the hard work of the national highway traffic safety administration, our partners like all of you here in the room, our state law enforcement partners, mothers against drunk

driving, safe kid, consumers union, consumer federation of america. the laundry list is huge. but originally all highway advocates. i'm sorry, jackie. i would never forget you. this is the problem. if i go list the people you all know me personally. you didn't name me. jackie, i owe you something special. we have to have lunch. i can never forget advocates. but the point being is this. it took a tremendous amount of work to get the behavioral changes to people to accept the usage of the technologies we were doing. so when you try to get better three-point belt systems. in some instances i know some of the manufacturers have automatic belt systems which they've gone away since then, for people to actually say when you're improving occupant protection, when you were working on child restraint systems, trying to put in latch, how we get people to

do it. how we move the needle and the choices that they make. that's power collect elf that we all have. ntsa has a huge role in this, and we don't shy away from it every day. in terms of our research, rulemaking authority, rulemaking priority plans. the work that we have done that has moved the needle on saving children specifically. talking about from 1975 to 2008 with estimated almost 9,000 kids were saved by child restraints, either by a safety seat or using adult see the belt. that's huge. it's huge. and it's a great success and we've got to do better. but then as we're thinking about all these things, and the hard work that it took, over the years in terms of the education campaigns, in term os. law enforcement about to say mobilizations, in terms of your hard work and your outreach and your publications and your lobbying on the hill and you

getting resources to our agency and others, this turns into the positive momentum that we need. but then it creates new challenges. because along with the notion of safety culture we also have the movement of technology and how we sort of balance these two. i'll give you a great example of that. now, as a proponent we are working very hard at ntsa on the next generation of safety technology, specifically crash avoidance. now, we've been working for decades on crash avoidance along with a lot of people in this room. and we've done this through a lot of ways. improving crash avoidance by highlighting issues in the highway safety program that we upgraded for 2011. it's the hard work of cfa and hard work of c.u. and "consumer reports" guides. hard work of the advocates talking or highlighting those particular choices of technologies and behaviors and state laws.

it's the hard work of -- it's a hard work of a whole bunch of people. but then the question is where safety culture goes along with this technological advance. because then you sort of get the counter argument from a lot of folks that have a different perspective on government regulation, on i'll excuse the term that i really dislike but i guess the best way to capture how to describe things, nanny government, right? how do we convey where the responsibility of the driver begins and end, where the responsibility of the automobile manufacturer begins and end, and where the responsibilities of the regulatory regime begins and ends. because we can issue rules, we can make manufacturers make modifications and changes. but we also have to have the people be willing to accept it. and in some instances in fact for the five-star safety rating for example, having people look

at that and make choices for their vehicles. whether they're doing to buy a five star safety-rated car. the whether or not that's going to be a factor in their decision. whether they're going to choose to buy a vehicle that has lane departure warning systems or forward warning collision that the agency has highlighted in this last go around in our upgrades. because those are technologies that have a huge ability in the future to keep the crash from happening in the first place. but then there's the question of, well, how reliant do we want our drivers to be on these systemsy value those particular systems? are they rigorous enough? is the cost that we'll be adding to a vehicle worth mandating it on every vehicle in america? will we save enough lives?

but there's a bigger question before you get there. because just like an electronics stability control, for example, there is a mandate now that's going to take place starting in 2012. but before that there was market penetration by the private sector for electronic stability control. insurance companies gave rebates for cars that had esc on them. people were hearing about esc as part of the packages of things. and they were choosing to buy it because it could probably help them keep control of the vehicle. and that had so much power that we were able to make those decisions. but once again, does that mean do we encourage people to drive aggressively? because you have a safer system embedded within it? the answer is no. we want to support the driver in times of emergency. and as we layer more things into the car, as the car has more

systems in it which will intervene when there is a point of no return for a driver, there are some systems that some automakers have which have crash -- braking now where they can and there is no way a human being is going to be able to intervene and get that brake pedal down hard enough to get that car to stop so the car will stop itself. now, some people think, i don't want vehicles making decisions for me. and that's one thing we're hearing in crash avoidance where we're talking about the people talking about awe ton mouse driving systems and where this leads. but question always has to be for all of us and our expectations. what about our safety culture? there is nothing that we as an agency can do to substitute for an alert driver who cares about the people around them when

they're on the road every day. you can't substitute for that. we can't. at the same time, it's our responsibility as an agency to create a zone of safety, recognizing that there are some risks created on the road every single day that if we have a way to help eliminate them or mitigate them to such a point that we can get fewer people involved in accidents and in suffering fatalities and injuries, then that's the way we want to move. but it all has to be together. but then the next question comes to all of you. when you come to our agency or you come to the consumer product safety commission or you come to the federal trade competition and say, this this is a priority. this is something that's happening right now that you have to do. and then against every other risk that all of our agencies have to work down and through versus the other sort of cross currents that maybe would be happening politically. from the cross current of what

consumers are willing to buy and accept. i think the classic example of the great conundrum for us as an agency is the dad system or the driver alcohol detection system for safety. it's work that we're doing collaboratively with the manufacturers. it's a five-year project where you can have a technology, hopefully by the end of our work in some years in the future, that a car could figure out whether you're over the limit before you start the car. you touch the wheel. it and if you are over the limit, if you are over .08, it could interlock the vehicle so you don't ever get on the road in the first place. as a society, we don't want drunk drivers on the road. we have vigorous state laws that will imprison you if you drive over the limit. we have spent millions of dollars every year in high

visibility campaigns on advertisements to support law enforcement to have checkpoints and do all this stuff. as the people we demonize impaired driving. we don't want to have anybody driving drunk. and luckily more people -- i think we've done a great job on social drinking issues. that was part of the bigger issue. but now we're down to a group of hard-core drivers that have a real problem that have a disease and they continue to make the choice to drive. so what's the next step? technology. so we're investing as an opportunity to see if this can work. and we have -- so far we finished phase one, we're into phase two. but the question then becomes, the car will be making decision whether or not you are able to drive. and i can tell you there's a lot of people that are very uncomfortable with the notion from a privacy standpoint, from a decisionmaking standpoint,

they don't want a machine telling them that i've made a poor choice and i'm going to stop you. safety culture. people know that impaired driving is wrong. you will go to jail if you're caught doing it. if you have a vehicle that has the ability to assist you in making that assessment, knowing that if you're over the limit and you get caught you're going to jail. that's the best-case scenario. you could end up killing yourself or others if you do it. but you know something? if i came out and said publicly that we were thinking about doing this 20 years from now as a mandate, the amount of controversy that you would imagine would be unheralded because it's a combination of technological ability, a combination of our ability to sort of figure out the costs and the risks, and then ultimately

whether or not drivers, consumers, are willing to accept it. and that's what we face every day as people that believe in the mission of keeping people safe, keeping people alive, making sure that people aren't cheated. like how much freedom and how much risk are we -- do we think that we personally are willing to absorb that the consuming public at large is willing to absorb, whether the political framework is willing to accept, and the ability for the agency such as my agency or my other sister agencies in public health and safety can do. so that's the great question. we have a fan asicly vigorous rulemaking agenda. i'm happy to talk about that. i'll take q&a for a bit to talk about those specific issues. but i really do want to sort of pose that general open question to all of you. we've made great strides in our mission at ntsa in trying to

keep people alive on the roads every day. but we are really at sort of a new day in term of where we are and our expectations of the vehicle, our expectations of the safety roads and design and all this other stuff. and we still have to move the needle. i want to be able to see a number of the things which we are seeing as huge risks on the road every day, people not wearing belts, people driving drunk, people speeding excessively, people driving fatigued, i would love to see that being as demonized as seeing a 9-year-old african-american boy riding on the back plate of a continental -- a lincoln continental driving down the road way too fast. i know that's my hope and my prayer and my vision. i know ron and i will come to work every day leading a dedicated staff trying to figure out these hard questions how to move the needle forward. and we need all of you and our exchanges and our