then we will have a better economy and some of those problems will be better. it will not solve all our problems but it will improve the situation for american. we care first and foremost about the american worker and we believe and most of our members are american workers and we believe strongly that solving our immigration problem, comprehensive immigration reform, the dramatic is one way, that is the way to make a better country host: host: josh bernstein, thanks for your time. guest: it is great being here. host: thank you for your attention and your calls this morning. we will see you back here we will see you back here tomorrow for another edition of the journal. we start every day at 7:00 a.m.

we will talk about politics and the 2012 race tomorrow morning. we will also talk ... al qaeda after osama bin laden -- talk about al qaeda after osama bin laden. and you're right -- you might roberta lieutenant general russel honore. he has been active involving the mississippi flooding. we will talk about what is going on there with the army corps of engineers. and lots of politics this weekend as well. enjoy the rest of your saturday and we will see you back here tomorrow. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]

>> live today on c-span, wrote to the white house, with 2012 republican presidential candidate herman cain as he kicks off his candidacy in atlanta, georgia. you can watch the former godfather's pizza ceo and chairman of the federal reserve bank of kansas live and noon eastern here on c-span. then on sunday, jon huntsman, former utah governor and former ambassador to china make remarks at a meeting agreed in franklin, new hampshire. that is live at 4:30 p.m. on c- span. both events will be live on c- span.org, c-span radio, and

available at the c-span to the library. >> history, as you know, is much more than just politics and soldiers and social issues. it is also medicine and science and art and music and theater and poetry and ideas. we should not lump things into categories. it is all part of the same thing. >> the snow morris, james federer cooper, harry picchu stowe, george thomas edison, henry adams sunday night with david mccullough on the americans who made the greater journey to 19th century paris. that is at 8:00 p.m. on c-span. >> nowlin succeeds in live by themselves. you must be willing to lean on others, listen to others, and yes, love others. >> watched the 2011 commencement

speeches on c-span memorial day weekend and search past commencement addresses from politicians, activists, authors, president and other world leaders on line of the c-span video library. you can search, watch, click, and share every event we've covered from 1987 through today. it is washington your way. >> now a hearing on the financial future of the postal service. also, remarks from the postmaster general on legislation that would reimburse the postal service for over payments made on its pension fund, which would result in billions of dollars in added revenue. this is almost two hours.

>> i especially want to welcome back senator akaka who has been on the dl for a week or two and is back and rested. and we need and that is best in that's what we're going to get. happy to be here with senator a in scott brown and with all of you. this is not the first hearing that we've called with regards to the postal service's financial soundness, but it's an important one. other witnesses full of familiar names and organizations commandeering today is likely to

be different from those we talked in the past. he needs to be different because the crisis the postal service faces is more urgent now than it's been in the past. absent, prompt action in our next postal hearing they will be about how we can help to shut down operations. it is my hope is here to jumpstart this process to develop a bipartisan bicameral consensus around the changes needed to restructure the postal service and transfer of its operations to reflect the uncertain future that it now faces. just last week the postal service board of governors for the some sobering data about the postal service's financial performance in the second quarter of this fiscal year on march 31. the board released numbers summarizing revenues for the fiscal year today. these data showed that as those of us who follow postal issues

is not recovering the economy as a whole. rather than electronic version, the male is likely permanent despite the postal service's best efforts to bring in new customers and reserve those that it has today. in the period between the beginning of january in the end of this march, mail declined by more than 2% versus last year. this follows two quarters of modest growth. at the same time the postal service had first-class mail last 6% containing its patterns of years of steady decline. these developments are contributing to losses by the postal services. midway through the current fiscal year the postal services and programs than $2.8 billion. his projected losses were

$8.3 billion, nearly matching the record 8.5 experienced last year. these volume and revenue numbers are worse than postal service initially project did and if the losses at the end of the year are truly as bad as we are now being told they will be, i understand the postal service will have exhausted all of its $15 billion line of credit for the treasury by the end of september and into the fiscal year 2012 with just enough cash on hand to get by. and it doesn't get a lot better from there. getting by in 2012 will likely mean that the postal service will not be able to make its $5.6 retiree health pre-funding payment and could even have difficulty meeting other normally routine pension and workers compensation related team spirit and top of that miniature crisis occurs at the next next year or so purchased for their economic slowdown

could well push postal service over the edge to insolvency and results in a shut down of its operation, something none of us want or need. the postal service were to shut down, the impact on our economy would be dramatic. as opposed master charles donahue will testify to us today, postal service operates at the center of the industry that employs some 7 million people and generates more than $1 trillion of sales and revenue each year. at such a difficult time for a country, we can now afford to put those jobs and product to be in jeopardy. in recent years the postal service is to ensure to respond to its declining demand for hardcopy mail it to to better align its cost with his revenue. total cost has been reduced by $12 million in recent years.

a big contributor to the success of an elimination of more than 113 postal service jobs since 2007 and more than 200,000 over the past decade. i think it represents reduction of our first by a little bit over 25%. these savings are continuing includes significant new workforce flexibility is. the postal service has introduced a number of new projects. one of those is the flat rate priority mail box. we are rapidly reaching the point however by which the postal service no longer has the authority under current law to do what it needs to in order to survive and prosper. that's why i'm introducing today

legislation that aims to clean up the postal service's finance and health implement the initiative reorganization plan that it announced last spring. the main provision in my bill, postoperation sustainability and transformation that for the post act aims to personally address the various pension and related issues that have plagued the postal service for years now. the postal service inspector general, the post of regulatory commission and two independent actuaries have all come to the conclusion that the postal service has overfunded its obligation of civil service retirement system by between 50 and $75 billion. numerous observers and the office of management and budget out the postal service and makes

it pre-funding payments taken up words of $5 billion when those payments are satisfied could be used to pay workers compensation obligations and retired to go to the treasury. these changes are sent and similar to them will need to be a vital part of any effort to improve the postal service's financial condition for both the short and the long term, but stopping these reforms and avoiding potentially more difficult changes simply will not be enough. more than $203 billion between now and 20/20. 230 billion. the pension and retiree health plans for my bill and others

have been introduced including a belt that senator collins would only address a third of these losses. in addition the postal service latest financial data shows that even the retiree health pre-funding not made this here come the postal service would still face insolvency and shut down in 2012 and even if the 2012 retiree health payment is not needed, they would enter 23rd team with no cash and no borrowing room at all. more will clearly need to be done. that is why my bill takes important step towards truly giving this postal service the flexibility that those of us in congress always say they want to give them to adapt to new realities and forth like businesses. no business faced the kind of difficulties and challenges the postal service faces today was

survive for very long if we were told how many retail outlet to have midway should be located or if it were prevented from making operational changes and expertise that it has as its disposal. if that's what the congress does to the postal service. i stress these problems and take congress out of the day-to-day management of the postal service. the postal service can continue to build on its recent cost-cutting efforts in the labor unions that are represented in most of the workers. but even at the postal service can continue to build on its recent cost-cutting efforts, these changes in years to come. the gao is releasing today a viable case study.

the report clearly sending a negative impact of the financial uncertainty and sometimes harmful dictates from congress have been on postal operations. gao found on the for example, that due at least in part to the postal service's dire financial situation, and they currently have no plaintive pleas to replace its very large fleet of delivery vehicles, some of which were first put on the streets a generation ago or more. the cost of operating and maintaining vehicles are increasing and at least some cases is having an impact on operations. i believe it's unacceptable that the postal service has no plans to date to begin replacing its aging fleet. perhaps of more fuel-efficient vehicles for purchase at which the large numbers could help commercialize new technologies. it's also unacceptable the postal service has been placed in this position financially, in part due to the acts of congress

or inaction of congress. i look forward to hearing from witnesses today about these and other pressing issues facing the postal service and i would also note that senator susan collins with whom i've worked on a lot of issues has introduced around bill and a fair amount of overlap between the overlap between the sheets proposed. my hope at the end of the day is work on these issues and others will find common ground. as i said earlier, we need to develop a bipartisan bicameral approach to address these challenges. i hope his many of the members in this committee will be part of the resolution. having been said i recognize senator brown and then we'll turn to senator akaka. >> thank you mr. chairman. i'm not going to repeat a lot of what you said, but i do want to point out that i agree with you

in that we need to allow the postal service to tools and resources they need to move forward. we need to remove some of the roadblocks so they can provide the service and guaranteed to their communities and not adversely affected. the party dressed obviously the fund overpayment. i think there's general agreement. the question of flexibility to work in a responsible manner to solve their own problems because clearly the path they are going down is not sustainable as you pointed out and i look forward to working obviously with u.s. senator collins and working on these very real issues. i appreciate the opportunity and the court to testimony. >> inc. so much. the entire statement will be made part of the record. senator akaka, welcome. >> thank you very much, chairman carper.

i went to thank you so much for holding this important hearing about the future of the postal -- united states postal service and may also want to welcome the postmaster general and ceo of our u.s. postal service and herr to our hearing. as we have heard time and again over the last three years, the postal service faces a devastating financial crisis. at the end of the fiscal year, the postal service may not be able to fully pay its $5 billion retiree health benefits free funding obligation. the government accountability office released last year expanded several options to help

the postal service. so i want to commend senator carper and senator collins who have both introduced legislation that aims to help the postal service meet these obligations by addressing overpayments to the retirement funds. additionally, senator carper's post at offers several provisions, which would allow the postal service to innovate and expand its business. both of these bills still contain a provision introduced in the last congress, which would bias the collect the bargaining process to favor the postal service during arbitration. the fact that the postal service

ratified the contract just last week demonstrates that the postal service and employees can work together to reach an agreement that meets everyone's needs. congress does not need to inject itself and the collective bargaining process. i also want to mention the issue of five day delivery. as i expect it, the postal regulatory estimated saving for cutting a day of service and more than the postal services. the prc also points out that postal service did not examine thoroughly the impact on rural areas. i am concerned about the impact of cutting service, which

already has slowed delivery to its location and the challenges moving between islands. ultimately, i do not believe this change would help the postal service attract new business quarter revenue. instead, it could harm those who rely on the postal service. again, i want to thank my colleagues for their hard work on these issues and thank all of our witnesses for their contribution to the entire process. these hearings will help us to move forward with legislation to finally ensure long-term postal service. thank you very much. >> it's great to have you back. our first witness is supposed

master general -- senator begich, and he slipped on me. it's good to see you. they can, we spend most of our day together. our first witness today's the post general master pat donahue or this is mr. donohue's first time testifying the subcommittee this is your first time? first time this postmaster general. for assuming the position mr. donnie is served as deputy postmaster general and chief operating officer at the postal service. mr. donahue spent his entire career at the postal service as a clerk in his hometown of pittsburgh. next we have the lip herr at the government accountability office. mr. herr has been the gao since 1980 and has a broad range of issues including postal issues.

we look forward to your testimony here today. both of your statements will be admitted in their entirety for the record. if you exceed five minutes, i will say much. if you exceed seven or eight minutes, i'll say something. so please proceed. mr. postmaster general. >> thank you, mr. chairman. good morning, mr. chairman, members of the subcommittee. i appreciate the opportunity to testify in behalf of the u.s. postal service. thank you for the invitation and thank you a mr. chairman for calling this hearing. the postal service plays a vital role in american society and the american economy. postal service will deliver more than 165 billion pieces of mail this year and shipped within 2 billion packages. read the backbone of a $1,000,000,000,000.000000 industry. the postal service is a self funding entity to innovate and compete for customers. we provide reliable secure and affordable delivery platform for

american business come and therefore in the national interest to keep the postal service financially strong. like any business, the postal service is subject to marketplace trends. unfortunately seen a significant long-term decline in their most profitable product category, first-class mail, which accounts for approximately 15% of our revenue. people and businesses are electing to send and receive statements to pay bills electronically. this produces mail volume. with aggressively cut costs in response to economic trends and reduce the size of the workforce by more than 113,000 employees over the last four years and we are consolidating processing and retail facilities. our total cost reduction in excess of $12 billion. we responded to volume declined by working with corporate partners and improving experience and creating innovative products for demand.

it would've recorded a cumulative profit over the last four years. mr. chairman, despite our significant role in the american economy and our interest in cost cutting and generating a first come i regret to say that we are in serious financial predicaments today. as things stand, we cannot have the cash to make a $5.5 billion prepayment for future retiree health and if it and we may be forced on other payments that could extend to operational expenses. the cost of potential delivery disruptions to the economy into the country country cannot be overestimated. even the threat of such disruption would have significant impact on america's business and irreparable harm and america's faith in the mail. mr. chairman, we need

legislation this fiscal year and i am grateful that both you and senator collins have introduced bills that address some of our most serious constraints. we especially support provisions that would eliminate the retiree health benefit repayments by reallocating our civil service retirement overpayments, that would return the federal employee retirement system overpayments to the postal service and provide the postal service flexibility to determine its own delivery schedule. i would also urge the subcommittee to start the legislative process with the long-term approach our business model. we assisting financial losses over the past several years that have created negative perceptions about the male postal service to some extent has had a negative impact on their business. the fact is that the right legislation the postal service can return to profitability is given the flexibility to do so the postal service will continue to serve the american public are effectively and continues to

sustain and propel american commerce. mr. chairman and members of the subcommittee, look forward to working with you in support of the schools and thank you for your leadership on this port. thank you. this concludes my remarks. >> thank you. we have a motto, five minutes or less. chairman carper, ranking member brown, i'm pleased to be here to discuss chios work on the fiscal service. i'll discuss the postal service says key issue on that seat being released and broader challenges the postal service needs to realign all its business model in the face of mail volume. total mail volume decreased 3% in the second quarter declined

by 7.6% compared to the same. i share. halfway through the fiscal year, postal service is reporting a net loss of 2.6 elion. as acknowledged today, the postal service projects a $15 billion debt limit this year in default on a 5.5 pre-funding plana for retiree health benefits. against the backdrop for the postal service needs to modernize its operations, including preparing to upgrade. the postal delivery has 192,000 people is, most of which are custom-built about 16 to 23 are sold in her perch in the of the day to 24 year operationalize. the fleet includes about 22,000 commercially available from age two to 13 years for the expected operational life with 10 years. they cost about a billion dollars in fiscal year 2010 or about $18 per vehicle. our analysis found that track

maintenance costs averaged about 2600 per vehicle which is a bit understated because subcontractor costs were not included. about 53 new vehicles required more than 7000 costs. the 700 vehicles required more than 10,000 direct cause. over one dbx says replacement cost. dirty 1% of delivery maintenance cost for scheduled maintenance. 11 percentage points. we identified maintenance problems for replacing frames were not being followed. friends were only replaced with four holes. we also found frames in severe less problems in new york state. featuring replaces private fleet managers reinterview to the vacation that's designed to

replace however, upgrading about 31,000 people. fully refurbishing thusly would cost less, about 3.5 billion or about 20,000 per vehicle, although the current course and replacing frames, motors and transmissions is effectively refurbishment at the slower. deepak acquisition requirements need to be factored in to replace delivery vehicles as well, namely the 75 vehicles as i acquisition costs and may not be operating mines and currently travel about 17 miles a day. by the postal service has been able to maintain its current sleep come in the time of come when the cost will not allow further delays. we recommend the timeline for

addressing this need. more broadly, an agreement will stabilize the postal service and align it cost of revenues for capital investment. as we previously reported, congress will consider modifying the funding requirement in a fiscally responsible manner chairman carper, ranking member brown and members of the committee, that concludes a prepared statement and returns the questions. >> thank you for that testimony. i want to drill down sql on the gao report released today, dealing with vehicles.

as i understand it, the number of vehicles the poster service pack, roughly 135,000, close to 200,000 about 20 years don't go very far. they average about 17 miles and the cost of see how, you can clarify, we're talking about the cost of fuel for these vehicles? >> we said a billion dollars for maintenance. the direct maintenance cost was about 750 million the feel cost less fiscal year was about 250, although the prices going up probably would've increased. >> one of the things the previous postmaster general, organize labor unions that represent the postal employees in the previous postmaster general is for us just to be creative and think outside of the box. we're looking for the postal service and we've even suggested

you create if you haven't already and they come up with clever ways to create revenues and reduce costs. i want to think about energy costs and talk about what were doing already to bring down energy costs within buildings. and whether or not there's any potential for a similar approach >> first of all, let me thank you were very proud of that and an energy program about four or five years ago now mainly focused on buildings and when you look at electricity, it

comes down basically to how much it cost to keep the lights on in the facility. we've done a lot of investment around special system setup was in our large facilities to manage that, but we've done a lot of simple things, just like replacing light bulbs or more cost efficient bulb fixtures and very simple things like keeping the lights off. so we've been able to cut electric usage by about 30% over the last four years and that something was very proud of. i've also listed a number of other facility innovations and upgrades. we've invested in things like reverse to help us not only sustained, but also an energy comp survey should standpoint, too. from the vehicle standpoint, we look at on the options right now. we have been experimenting with hydrogen vehicles, natural gas, diesel, lecturer, hybrid and try

to make sure we look at everything and anything out there and we have two considerations. number one, the daily cost to operate the vehicle, but more importantly the long-term cost and that's why doesn't he look to a lecture, we've got to maintain calm in mind that leaves come the idea to replace batteries and that has to be considered part of the long-term investment. right now we're at a place where we will have to buy some vehicles in the next two years. but in order to do that, we've got to get our finances in order. again, you appreciate your bill because that will help us get the short-term finances in order that we can address on the long-term investments. >> any comments in response to that quiet >> we did ask a few folks in the industry about the idea of the energy sharing contracts. one of the points they made is because the vehicles travel relatively short routes and use small amounts of fuel, that can -- it may work well with domains, but may be a tougher

thing to use in terms of vehicles. >> under the energy sharing contacts, as i understand folks coming into work to reduce energy consumption. and their payment stream will flow from the energy savings that are created by the retrofit. and that just doesn't work for vehicle assessment. >> it would be a new idea for that deal, but i think given the fleets and also the long -- they are hoping to do another by would raise some other questions in the long-term commitment, too, for the industry. >> one other thing i asked you to keep in mind as we know places that are undemocratic and unreliable. we're pursuing and my estate may

be though windmill farm and be able to seal at least 100,000 homes a day. we know the windows don't always blow in the sun does in a way shined. one of the things i like was to keep in mind i don't expect you to think as we look outside the box and trying to reduce not just are building costs, but also her vehicle costs for energy, see if there's some other way we can use the opportunity to make money or save money, not just throw out an idea. are moving towards hybrid vehicles. chevrolet built 10,000 this year come in extra totaled 50,000. we're going to lunch 80 miles per gallon at the end of next year. they have to be field someplace

and were going to be looking for fueling stations for electricity. to the extent the postal service or the business of using electricity to power vehicles, there may be an opportunity to also sell electricity to the customer or for looking not the price of natural gas. the other thing cannot predict the ball soars of wind and solar because they're not always fair. but if we had somehow a fleet of vehicles come in maybe 185,000 vehicles that could almost be a reservoir for electricity. so when the sunshine and wind is blowing, you actually charge the batteries in the vehicles and then sell it back onto the grid. that might be the opportunity. i don't know if any of those

ideas will actually work out. that kind of way we have to think outside the box, be more entrepreneurial than we've ever been. part of the responsibility is for us on this side. and the others may be working with the folks in the abu industry with what might be possible. let me stop there. i have another round of questions about come to that later. tanks. >> thank you, mr. chairman. mr. donahoe, what do you need congress to do to get your financial house in order? what recommendations do you want us -- to have to so you can solve the problems? i appreciate the hearing. and that to you exactly specifically what you need from us in order to become financially viable. >> well, we need this bill passed this year. >> what though? the ability you recommend we

passed? >> i think the post that was by senator carper answers the need for the postal service both in the short-term and long-term. it's a very good portions of the bill by senator collins and hopefully everybody can get together and get those parts into the post though. but the postal does for us is that it provides immediate resolution on the retiree health and it fits. >> that the number one thing. >> that's the number one thing. we need the ability to shift out of her. >> that has to be addressed. the critical thing and that's the reason i see the entire bill is because not all make it says to break even now. it does not help us in the future in terms of paying off debt and even when you get out two or three years down the line will be back in the same boat. >> so if we allow for the shifting it will basically give you about a one-year window? >> that gives us a year window.

>> that's number one paired with number two? >> to resolve and returned her federal employee retirement system. we are overpaid the post though against the retired health benefits and paid that going forward >> how far does that get you? >> is worth 7.9 billion. that would pay half of our debt off. >> and then were? >> in the delivery flexibility. one of the issues were faced with going forward is the problem of declining first-class revenue. and mention the first classes half of our revenue. it is two thirds of our contribution in terms of paying for the overhead that pays for keeping the routes fully staffed on a daily basis of 200,000 routes plus 35,000 post offices. that's all paid by first-class. >> the price of the first-class

keeps going up. i'll just get in line and out. why would i spend another 44 d., whatever the ultimate number will be. what if the volume goes down? >> us who are facing. this year is 7% last. in the last four years, first classes dropped 25%. if it's unreasonable pressure in the organization. what we're proposing is flexibility for delivery. >> talking about routes and elimination of potential services to get in there and get great at it. >> here's the thing. there's two things. we have been very -- we've worked very well with the agents and will carry you need to consolidate routes. we've taken 15,000 routes on the last four years, which is well over a billion dollars in cost there alone. but we need is flexibility to eliminate saturday delivery is required and mandated by

congress. >> saturday everywhere for saturday somewhere quite >> we are proposing to keep the post office is open, allow customers to receive mail through post office on saturday, but we would eliminate regular delivery on saturday in regular express mail on saturday. there would still be serviced, but we would take costs out of our network. >> what's next? >> what is next after that is continuing to be able to be very flexible as far as what we do with product offerings and additional revenues generated in the organization. senator carper mentioned innovation. we are very pleased with the innovation we've taken on listening to our customers. you've heard about flat rate boxes. if it fits, it ships is great because customers can use this in many different sizes, different prices. all you do is put your package and you can even ship it from

your home with free carrier pickups. we've got other products coming to sample box coming out. we think there's a lot of growth in there. here's something that's really interesting. we've been talking to the mailers about this. it's called a qr code. this ties in some of the latest technology he heard here so it works. he was a mailer to send to somebody's house. they take it out of their mailbox on the message says for information take your phone is scan the barcode. what this does is ask you up to a website where you can find out more about the product and buy the product online to conduct a whole transaction within about five minutes. >> you going to get a piece about? >> yeah, we've even talked to people, so free enough to do those things to continue to work with the postal regulatory commission has a lot of options there, too. >> mr. herr comic thank you.

were talking about the fleet vehicles and updating and not be a slave as they travel such a short amount, i have a hybrid conversion bill that would allow the conversion with a simple process, say 25% consumed. i am interested in dissecting your report a little bit and understanding. if there is a mandate to do ask amount, does that come into play that it may not be cost effective to do that quite >> in terms of alternative fuels? >> right now there's a price differential is $10,000 -- over a fleet of that i've come it would race and challenges. it's also been improvements in technology and gas engines being developed as well. some of those on some have been certified by epa as well as the mission. there have been some things evolving. over the next two years i think

senator carper said from watching how the industry changes may be important to see what makes the most sense. >> i'm all set, mr. chairman. >> senator, there are more marks in the u.s. senate. how many are there? four or five? >> four with marco rubio. the mark caucus is well represented today. >> if i can do a quick follow-up on a couple friends. i agree with you on the short-term -- on the short distance it's hard to get economics under fuel efficiency. but on your long-haul trucks, are you looking on those with some of those large semi truck movements because that's where the real money is in energy saving on vehicles. they go done a big long path

there, that tracks, are you looking at that piece of the equation? >> yes, senator. we do two things is what we call the heavy fleet. we've got her own fleet of vehicles, two-ton on the way up to the tractor-trailers. we are working with the industry to have the latest as far as technology. as a matter of fact in new york city would operate 30 electric and two-time vehicles and we've been very successful with using the technology. the majority of our long-haul heavy fleet is done by contract and we work with our contractors on that, too. they are senates the contract to make their vehicles more energy-efficient. when you're driving along the road, discursive and putting on the trailers, all of our contractors are moving that direction because we found a simple addition like that helps fuel economy. we have sent people to work closely. >> have you thought on the under

the -- i forget the number. you said 185,000, 20,000 vehicles. just going out to the market and say look, here's what we need. we need to replace this vehicle fleet. we're open to lease, purchase, you know, when we got heavy into 15 oliver computer systems, for example, the department says we are buying this stuff because the change occurs, but also we figured we could get a better deal with the companies because they refused us as poking up their production and therefore cut their costs and do other product off the same frame and ours was the same computer technology. have you looked at it rather than you are trying? sometimes i wear the government and quasi-government tries to analyze what is the best result rather than going out to the private sector, saying okay,

this is so weak. 185,000 vehicles to purchase the parameters. give us your best deal and what you can do to bring the same cup even though the hesitation would be the money. well, you don't know what they can offer good until you ask the question, they are hungry out there. to approach it that way? >> you're so we've been doing. we have been working through the technology is just to get an idea of how well it works within our organization. one of the things we learn from the vehicles with the original intent to try to keep for 25 years was to test ban in arizona. arizona is not a real good place to test vehicles. if you need to be in the states and from pittsburgh. granados know if you, but we have our obstacles going up and down how the wintertime. at any rate, what we are doing is looking to figure out what the best technology is. we are working with the private

industry. with a general motors on the hydrogen fuel. we've had a number of companies with ford, chrysler and other companies. we're trying to figure out the best thing. the key thing for us right now is this, we have got to get a good idea going forward on what the technology for quake four, five, six in 10 years down the road. we've done some leaseback work in the past that's not been the most effective for us from a financial standpoint because i can't write anything off from a tax perspective. so we are looking ahead. we've been talking to private industry will make some decisions, probably two or three years down the line because again i've got to get the short-term financing straightened out the rest assured it will work with the private industry on this. >> let me ask you when you came to map a couple months ago, first i want to say thank you for recognizing alaska's unique.

we had a conversation about universal service is for all areas. as you know, we've written a letter regarding five days. i recognize flexibility in my big concern is how do you deal with the areas that may have flights coming in and certain supplies that come in on certain days in rural alaska. maybe saturday is the day because the weather is good on some other issues. can you give me first your thumb in universal service and bypass combination of the two and how yellow dress borough communities and obviously unalaska with five day versus what it is today. but first on universal and then bypass. >> as you know, we are fully in support of our mission to provide universal service to the american public. any changes we make so comes first and foremost.

services are name and that their mission. from the standpoint of how that ties to the bypass to realize how important the postal service is to not just the economy in alaska like it is to the rest of the u.s., the people's livelihood to get food and medicine and we also take that very serious way. i think our people to a good job making sure the mail gets through everything. your point about the delivery and discussion around saturday's something we've been looking at. we've had some comments from a number of people from different parts of the country about what do you do going forward? our proposals are delivery flexibility and it's just that. we think for the most right that we would make the changes and saturday would be a day, but there's some weeks during the year that we don't deliver mail on monday. we are taking this may be delivering on monday and some of those cases. in the case of alaska and hawaii after some provisions we've got to work with, like you said,

there's no cause on a saturday. we have to be flexible with that, too. that's why we've used the term delivery flexibility. we went to her because we realize it's our responsibility to provide the service. >> lasley because my time is about to expire, how would you be engaging stakeholders like in the case of rural alaska versus anchorage or fairbanks? how you engage on this schedule flexibility? >> one of the things we did last year we spent some time and of course we can do that again as we move towards changes that we would be getting out of the passage of the post-act. we would engage customers the same way we change post office access point. we're going through a process right now where we are looking at mailing out and inviting people into talk to us. we would do the same thing, with the customer service is the mail

and customers to center. >> i just want to agree to in the pension issue. that is a critical number one issue in a very supportive. i think you're doing a great job there. >> senator pryor. >> thank you on mr. chairman. when you start with your family. the poster regulatory commission made some recommendations last year about some things you should do is your closing post office is. one of the recommendations is people in the area should receive actual notice, which i assume would be like a postcard notice and apparently your current practice is just to notify your p.o. box customers and carrier delivery customers about the affected facility. the site recommendation would be that the postal service would expand methods available for providing and receiving customer

input. the third recommendation they made is they would expand the contents of the public notice and include better information about alternatives for customers. my understanding is he didn't implement those recommendations? do you know why you didn't? >> were having some post offices closed in our state and the people in our state at least feel like they are not notified of this adequately. they don't have opportunities for input. whether opportunities for input it seems like decision had been made and maybe are going through the motions to check the box but you're really not take in consideration. if you want to comment on that. >> we don't go through the motions. i may say this. we agree with all the recommendations and we have changes be posted in the federal register recently to implement those changes. here's what were looking at. we like to call it access change

versus disclosing post office because the intent is to provide their access to the american public. we are going for a process right now we've had a process in place for 30 years where we've examined small offices and we agree that it could be much more customer friendly. milly notices out to customers, having community meetings and also listening to and providing them -- listening to their recommendations and providing what they're asking for. we're looking at this across the country. today 35% of all postal service products are bought outside the post office whether it's online or at cost or office depot or places like that you can buy stamps and packages them that will continue to evolve in that direction. what we want to do is make sure where we are aware the american public needs is to be. that's the case with large offices like in washington d.c. for rural.

but when i do is take a close look at how to provide the access in the best way both financially as well as the number of hours a day. i give you an example as things were some small offices were looking for consolidation because we find many houses don't have an hours worth of work in a day and people don't have that much business. if it's close, a mile or so. other cases are looking at many talents of three businesses, gas stations, general store and post office. we're looking for talking to the general store for gas stations that keeps them in business, keep the cash flow and allows people to have access to the business at the same time get their postal services through that way. many options are willing to want to hear from people. >> let me ask you this follow-up. it was me and you want to hear from people?

>> yep. >> how many facilities have been on the list for closure? and then he went to the public comment process and decided not to close? >> i have to get back to him that. i can't tell you off the top of my head. what we've been focusing on most recently prior commitments that were rd closed and we've just seen the paperwork up and finish them off. there is a number we're looking at right now is about 1000, but it have to get back is far as specifics. >> i like to know those numbers. mr. chairman, other record along those lines. i would like to ask about senator carper's bill. sounds like you a party said he the financial parts of this legislation and you think that's very important for the financial viability of the post service. but if you got a five day delivery, how much will that be the postal service? >> i will say this about $3.1 billion. >> the year? >> a year.

and on the criteria -- this is another part of the chairman's bill, but in the for closing post office is in postal facilities, you mentioned today small facilities or low-volume facilities. what's your criteria. what criteria does the postal service used? the mac we are looking right now the first at less than an hours worth of business in a day and that's generally 10 or less transactions. >> is that in that the postal office will close their? >> that means we are looking on it to either consolidated or potentially contract the work out or leave it alone. we're trying to keep as much of an open mind on this thing, but again from a financial perspective we have to put everything on the table as far

as taking costs out of organizations. >> it seems like its members driven. i can to get some samaritan center begich his favorite low-volume because they have very sparse populations. would you consider that as well? >> again to my comments was to balance the requirement for universal service. in many cases is something you don't look at. if you have a small office that doesn't generate much revenue, we certainly wouldn't close it. but if it's something that generates the revenue and there's the potential for better access within a half-mile per mile, that's a different story. >> one of the provisions in senator carper's bill talks about the shipping of alcoholic beverages, which right now you are prohibited from doing. q. how much revenue it generated fewer like to ship alcoholic beverages? >> we don't know, but we think it's an excellent i.t. is because the postal service brings his convenience and the whole industry.

we've seen other -- australia has done that and that's one of their biggest growth products. we've got the network to provide that service along with the ability to have it held. our proposal is more for pickup, so that talk about to come in and pick the alcoholic beverage. we think it's a very interesting proposal. >> one last question on senator carper's bill and that is there some provisions in their about when you are in arbitration with your employees that the arbitrator could consider the financial condition of the postal service. is that the rule today or would that be a change? >> that would be a change. we support that. we think it's important anytime you go to arbitration, especially in today's world where if you look at the future of postal service, the arbitrator should consider -- we recently conducted a negotiation

with the american postal workers union. i think it was a very good responsible contract by both sides. that's a great thing.

>> that's very smart gove. our next-door neighbors get netflix and it's a good piece of business and and how this will be when people move into screening and it's the kind of thing that we just want you to do more and more of. i just want to ask a question about how important is it that the postal financial bill that we consider here in converse go beyond the pension and health issues. how important is that? >> it is critical. as i mentioned to senator brown, what happens is if we just address the retiree health benefits that just gets us through this year from the cash standpoint and if you recall we lost $8.5 billion unfortunately this year we are predicting losses around a billion dollars

so you can see if you get the relief of the 5.5 or $5.6 billion going forward that will not be enough. it's critical that we address the issue, the overpayment and then we can get that money back that will go against the dead we will not spend that anywhere else on the retiree health benefits or the debt, the delivery flexibility, the flexibility going forward on the products we talked about anything and everything in the bill was critical. we have to get the whole thing done and from the industry standpoint we have to make sure we make all those things happen. >> it seems there is a fair amount of agreement we'll try to redirect the payments in the retirement system, the overpayments into the system and to use those to pay down the obligation for the retiree health and also for maybe workers' comp. but as we understand, that's only about maybe one-third of the problem. so in terms of going forward if

the flow of money from the retirement system and stopping the overpayment i think that is only about a third of the problem. >> this is what happened. right now we have an outstanding responsibility of $91 billion for the prepayment of the health benefit. we pay 43 so far through the rate payers money, so that's -- we've got about 47% of the way paid. if we were able to access the funds 50 to $75 billion, that would clear that side of the ledger. the volume loss we are experiencing in first-class mail keeps the pressure on our organization and the industry as a whole to continue to reduce cost and at the same time figure out how to use it in more creative ways like i've shown before - with packages and even trying to slow down the drop-off

in the first class. one of the things our customers told us is if you can figure out a way to make the first class more appealing from the bill presentment standpoint, we will try to work with our companies to stay in the mail. the first recommendation is what was called reply rights where we were going to charge the same post for 1.2 offices as we do for one else. the customer said it's too complicated so what we are proposing now is to give 2 ounces for the price of one this with the customer can use better paper, the messages in with the first class correspondence because in many cases that's the only way a customer gets the customer's eyes, so our proposal is we want to keep our foot on the gas pedal of the cost slightly we've been talking about, the revenue is just as important. >> dewaal to comment briefly on the question. the first question i asked in this exchange is hauer important is it the postal financial

relief bill we consider go beyond pensions and the retiree health issues? >> if you take care of the one without addressing the overcapacity processing network and looking at alternative ways to provide the retail access in a few years you will come back and find some of the structural problems were not addressed and you will be facing a similar set of challenges. the list of 25%. the projections for it is going to continue to decline so address in that capacity and making sure the system is aligned with the needs of the mail coming in would be critical >> you've concluded a round of negotiations, and it sounds with the contract negotiation but i think it seems like a fair contract and heading in the right direction. we have three other unions to

deal with. give us a status on the negotiations with those, please. this to meckler stila in negotiations with several carriers. we would like to conclude a successful negotiation with the same outcome. i think the ap w is a responsible contract not just for the postal service and the employees but also the industry so we would like to conclude the same way. this november we began discussions or i should say august because the contract ends in november with the mail handlers and the national association of letter carriers, so we expect to see the same type of framework in those contracts we've been able to negotiate with the apw. estimate this will be the last question i asked and we are joined by senator mccaskill. i want to talk about a business opportunity to read the last white feel about the six day delivery, and i said why was agnostic on that and if there

could be a way to save substantial amounts of money not as much as 3 billion but through the negotiations, then i think we ought to consider that. if we can't find substantial savings we are not going to consider that as much the we talked about the opportunity costs cut and of not having that sustainability. i think there is -- we talked about this before. someday somebody will look back at the postal service and say we had a post office in every community in america and went to every door six days a week. why didn't we think of xy or z in being able to exploit that all business model, just talk to us very briefly about the opportunity cost of eliminating the mail delivery whether it is expressed or doing the work for fed ex and ups, let's talk about a little bit if you would. >> you know we would rather not eliminate saturday delivery. we feel proud of the fact we do

go to homes and businesses every day, six days a week to every home and business across america. the critical issue was the continued pressure we have on first-class mail and the fact that the contributions as that drops continues to put financial pressure on the organization hot hot. we think it's important to provide that service and even if five days a week we will still have the greatest network of everyone because we will continue to go to every home and business five days a week. we also think it's important to continue to work with our customers to sustain first class as long as we can as well as new opportunities from the other standpoint. and i think you would be and

that is a combination of reducing and eliminating the retired health benefits, delivery flexibility. that takes us from 73.5 giunta 65 billion in between. administrative cuts come successful union negotiations i would like to get us down to 60. what that does is gives about a $5 billion cushion from the revenue right now that we will have this year that gives us the ability to pay down the debt that keeps us from going into the future and addresses the capital issues we've been talking about today. seabeck thanks so much. senator mccaskill. welcome. >> i would like to fall on the chairman's question he just asked. we have a difference between two different agencies that say that a five day delivery you all say it's going to save 3 billion the regulatory commission said it would generate 1.7 billion.

i don't know how much of that difference is attributable to the loss of business that inevitably is going to occur when you can't do this six day delivery. you have an advantage right now that was six day delivery. if you were looking at this through the very cold lands of a pure business model, you are giving away the major advantage have when you give away that sixth day. can you speak to why there is such a wide disparity between the savings the two agencies came up with, and you know, what keeps us from going up to four? and aren't we really if we are not careful, if we go to five, aren't we talking about the beginning of a death spiral here? >> let me address a number of the questions. first of all, to repeat what i said to the chairman, we do not

want to go to the 65 but financially we are in a situation where we've got to take that as an option going forward and it is tied directly to the loss of a contribution on the first-class mail. if i had an answer to stop that we did that in place right now. america is changed and people are paying bills on line, every bill that's paid on line that is 18 cents comes out of the cost to cover the six day delivery and office is out there. the difference between our estimate and it boils down to two things. their estimate of revenue loss, 600 million, ours is 200 million. we talked to a lot of customers and did a lot of opinion polls. many customers in the past used to make sure that they -- that we delivered mail on saturdays. they've moved away from saturday by far our latest date of volume for two reasons. a number one, many businesses are closed saturday and number two, what we've been told his

people to a large extent don't look at their mail on saturday as much as they do the rest of the week because they're busy with other things. so, the 200 verses the 600 million that's part of the difference. the of the part of the differences our estimates of being able to save and capture the costs. we think we can capture a substantial portion of the cost of saturday delivery by observing it into monday. the letter mailed we deliver today is sorted by automated machines and processing facilities. so that the variable cost in the morning that a carrier would have experienced years ago they don't experience today. once you're on the road and deliver to a number of houses our average cover is around 90% today. every saturday business costs us

$3.8 billion. we think we could save 3.1. we know that we will have to add some costs we can't afford but based on our history we've taken cost of the organization and we will be able to do that. theater thing is i in canada devotee to do with its going to get done. >> let me also ask about the potential to impact on the five day delivery on the residence. i was disappointed when i realized the postal service's survey the you did in this regard or not really in the rural communities. one was in suburban atlanta, and the other was suburban seattle. would it be possible to take a look at a rural community, not one that is within commuting distance of a major city is those folks that in terms of getting their medicine, which of course we all know that saturday delivery is very important in terms of their ability to

receive mail on saturday. is there a reason why what i would call a world community is that included in the survey? >> we can go back and take a look at that. there's also been a number of surveys done across the country by restless and at the gallup poll that have looked at different communities across the country, and consistently what comes back is when asked the question if you made a choice between no delivery saturday closing post offices or substantial increases in postage rates 70 present of americans have come back and said eliminate the saturday delivery. our proposals to eliminate the delivery would keep the post offices open so from several perspectives people would still have access to postal services and if they wanted they could rent a box and get their mail that way. >> fodor role post office closing, i'm a little worried about what i have learned that

there may be a situation where you call something other than a post office so you get a around some of the requirements in terms of notice to the community. could you eliminate that situation for me because changing the name of a post office to a substation or some other name and then not having to go to the community and get the kind of input that is needed i mean i get that we have got a huge problem here, i get to that the money coming in doesn't match the money going out and i am not trying to throw tax in front of the bus except to think it's important that the liberal communities feel like they have an opportunity to weigh in and i want to make sure that there's not some ability that you may have to get around the regulation for notice and public hearing by just renaming it something different. >> we agree 100% we it's a process in place right now as a matter of fact we just finished the federal register notice

where we will provide public input, public notice and public input on any changes to access we make. we know the postal service especially in the rural areas is very important and to your point, we have got about cost and benefits. we won't do anything to hoodwink the american public that we. we are proposing in the federal register a top-down approach that assures fairness sood you don't have won a state that's going gung-ho and another that doesn't take a look at it. it also assures we make the right decisions and senator begich we were talking of the importance of what we do in alaska, and i appreciate in the missouri and arkansas we have gotten a lot of the rural areas, too said you have my assurance we will make it a very fair process, people will have plenty of input and makes the decisions and make sure we reach out and send anybody the screen to be effective post cards will go out to customers and we will have a

hearing and discuss and take their input. >> i want to compliment you on so many pieces, so many parts of your legislation i think a lot of it is very, very strong and i know how hard you worked on this and i do want to compliment mr. donahoe i think you're trying hard and difficult circumstances to figure out how to put the puzzle together. i do feel very strongly if we can say six days it is important to the integrity of the product that we have which is the united states postal service six days a week is going to happen and i worry that we are going to diminish the ability of the business model to survive if we start cannibalizing it by going to five days so if there's any way that i can work with you to say the six day delivery i sure would like to do that. >> i'm going to go back to the negotiations that taken place between the postal service and one or two of the unions going forward as part of it as well and our ability to help them in other ways to compensate for the

-- the savings is a number between 1.7 billion, and roughly 3.1 billion, somewhere between there and that's real money. >> of one to come back and before i yield to senator begich for closing questions just a clarification, in your view of what would still be provided on the postal world where there is no saturday delivery would include people could have a box, post offices would be open. what did you say about express mail? >> we would keep the post office open, we would have post office box accessibility and we would deliver express mail and run the network so the mail coming for the network, payments and remittances for credit card companies and what not would still run so monday it would be delivered or in some cases if people have what is called color service and they would have large facilities for that mail. >> thanks very much.

>> mine is just a clarification and in a statement. i call it what you said to senator pryor with of of 30 miles or within. as you know in alaska 80% of the area is a long road access, so i'm assuming that is part of the equation because when we did the air service there was the great debate we would cut off the surface to get to the hub to the next in many cases it is hundreds of miles away and there is no road to get there so you recognize that -- >> in alaska presents the situation been hit with the universal services similar to hawaii that we have to take a different look as we work through that. estimate as to send notifications to the folks i know everyone gets mail and material in the mail and they don't pay attention to it until something bad happens and then they say i didn't realize that

was happening. and i would send out a postcard and it would say closing your post office, and i guarantee you will get 100 per cent engagement otherwise if it is just a regular we are notifying you of the post office situation and change an operation here's what will happen. they will set it aside and sit down and read their catalog for the day. islamic maybe we will use the code click here to find out what is going on. >> i will just tell you -- >> if anybody come plans of going to tell them you gave me the idea. [laughter] >> i will give you an example i was invited to a meeting when i was mayor and was about a land use issue no one was going to come out or because so many months away to the flyers and out of the neighborhood is learn how your taxes are going up so they had full capacity and the local council members and said your up front, we are not. and they would talk about the

land issues and people would refuse but they got fully engaged. >> thank you for using the mail. we appreciate it. >> and they can't deliver it on top of that. >> thank you. >> senator, thinks for being here today and being an active participant. we need your participation so thanks. that's going to do it for the first panel. thank you very much for joining us. we would appreciate your response to those. thank you. islamic mr. chairman as the panel is coming up, do we have a vote at noon? >> initially noon. it's moved to i am told 12:17. so we have the opportunity to hear the panel, second panel, and probably have to break off at 12:dirty. >> okay. thank you.

[inaudible conversations] >> find your seats, please. and i will ask those who are planning to leave to go ahead and make your way to the door.

i'm going to briefly introduce the witnesses for the second panel. if you didn't catch it, the vote has been moved from noon to about 12:15, and i want to complete the testimony for this panel before we have to break. we have a vote followed by the respective caucus meetings but i want to finish this panel and have a chance to ask a couple questions and then we will move on. our first witness on panel to is margaret and we welcome you. the director of accountability and compliance of the postal regulatory commission, ms. has also worked on rates and classification of the commission and served as the lead postal auditor at the gao.

next postal service inspector general mr. williams is the second independent inspector general of the postal service is that correct? before taking on the job, he worked as a deputy assistant administrator for the aviation at the transportation security administration. he also served as inspector general at five other agencies. next is cliff guffey. how long have you been in office now? >> [inaudible] >> as it seemed longer? [laughter] -- [inaudible] >> you have had a full year. congratulations so far. i know it's not easy. before becoming president mr. guffey served for nine years as the executive vice president and a senior top leadership positions since '86 and started his career in the postal service

in 1971. next is marks strong the president of the national league of postmasters where he has held leadership positions since 2006 i'm told. he is the postmaster in arizona we could use some sun around this city and a couple of days we will get it. finally, we have jerry cerasale for the direct marketing association. mr. cerasale has a long history working on postal issues including stints at the house committee on post office civil service and the legal staff of the postal service and postal regulatory commission. it's great to see you. thanks for coming today. full testimony will be part of the record. please, proceed. >> good morning chairman carper, remember brown and members of the subcommittee. thank you for the opportunity to to present the views of the u.s. postal service financial crisis.

mr. chairman regrets being able to testify personally today. she is presented comments. i ask that the chairman's comments be made a part of the official hearing record. >> without objection. >> the united states postal service will include its year and will not have sufficient cash or authority to pay all of its bills. the commission analysis review of the postal service request for the rate increase from the postal service cash flow problem is related to an overly ambitious requirement for the postal service to refund its future retiree health benefit premium. over the past four years the postal service has paid $21.9 billion to pre-fund the benefits. all other things being equal without the pre-funding requirement, the postal service would have achieved a small net profit over that time. instead, over the last four years it has accumulated losses exceeding $20 billion. this year it will exhaust its authority and anticipate another

multibillion-dollar loss that will leave the agency insolvent. german carper you proposed legislation to address the crisis and build on a postal operating model of the post of accountability act. the commission supports the fundamental approach of your bill and addressing the financial crisis as well as longstanding issues related to postal service funding of the pensions and future retiree health benefit. the strategy is grounded on objective expert analysis that incorporates the best practices of business and government and previous studies. the commission appreciates the bill provides a regulatory oversight of the mom products and services that may be proposed under the flexibility to be provided to the postal service. this will promote growth and innovation while protecting the public interest as it is the case with coastal products and services. the commission also supports modernization as the allies reprocess to make it quicker and

more robust. the requirements for the postal service to respond to the issues and recommendations in the advisory opinion is an important improvement which may be further strengthened by requiring the response prior to implementation of the changes. the gold altar the opinion process to produce decisions within 90 days from the date of the postal service request to the commission. under the current all the commission evaluates the changes in formal hearings on the record that are subject to the administrative procedure act protection. this proceeding can be time-consuming. the proposed legislation with the opportunity for citizens, mailers, competitors and other parties to octane information from the postal service and test the service resumptions. as a result the commission would be able to produce its opinion more promptly. however the detailed analysis and extensive outreach of the recent advisory opinion on the five day delivery would not have been possible in the 90 case. the commission hasn't conclude what is the 90 day limit.

the postal service is also advised in the near future the plans to request an advisory opinion related to the closing of the large number of post offices nationwide. the commission understands the postal service need to address the network to the changing demand and its evolving capability. however the requirement of effective postal customers be properly notified and evolved when the postal service considers closing the retail office they depend on to read the postal service proposed revisions to the rules for closing the consolidating retail facilities. the commission provided its comments to the postal service including recommendations to better ensure customer's ability to offer input coming from the evaluation of the affected facilities and coordinate the discontinuances and the availability of replacement retail services. i would like to reiterate the commission support for elders and the postal service financial crisis as outlined in your bill. congressional action to address the retiree health benefit issues remain the key element of any reform effort.

effective oversight is vital when the entire system is under such great stress. the commission will let have transparency and accountability and promote positive change and adequate service levels needed to keep the postal service vital and relevant that concludes my statement a bye would be happy to answer any questions. the chairman could not be think you very much for your participation. give our best. >> i appreciate the opportunity to discuss the serious financial condition of the postal service whose leadership the anticipates being unable to meet its financial obligations in the fall. the postal accountability and enhancement act was crafted to incentivize the postal service to adopt a volume driven infrastructure. it also required the refunding of benefit plans of the screamers from aware they have been subject to the wrongful overcharges.

consequently the resulting payment of 90% of the $20 billion in the past four years. this causes in flux structure crossed and burdensome debt. the contaminant infrastructure optimization are under way it will take time on those numbers large-scale actions were undertaken simultaneously which could outstrip the management ability to control optimization and avoid unintended consequences including service disruptions. so what is needed? in addition to benefit reform, postal service optimization of plans to post offices and it minister of infrastructure my office has recommended the conversion to the easily with a letter carrier routes for effective management. flexible rules managing the a bin flow of mail. a comprehensive delivery point strategy maximizing the curbside delivery and cluster box facility. the district offices

simplification of the acceptance and pricing growing the value of mail and finding the postal service's role in the digital age. the digital age is continuing to disrupt many communication industries, the technologies provide americans low-cost instant communications, sophisticated data organizations come search engines, hyperlinks and mobility. however americans need stronger infrastructure to cope with serious collateral issues and citizens would benefit of the postal service could support americans and addressing the emerging confidentiality, security, dependability and privacy problems of digital communications. partnered with federal state and local government agencies to provide that each government services and post office windows services for more complex transactions provided safety net for those left behind by the digital revolution center carper's bill proposes allowing the postal service to provide mom postal service as utilizing digital infrastructure consisted

of public interest. the bill would provide the postal service an opportunity to find its role in the digital age. the postal service aside more than $300 billion in cash to meet its obligations. additional contributions of $55 billion will result in a 100% pre-funding level. it doesn't include the overcharges documented by my office and others if the overture to return to the funding level will exceed 100%. a lot of the funds are being reexamined in the action conference and the postal service could explore an option of clarify increase funding requirements to be inclusive of assets. the purchase price of the postal service real estate is $27 billion of the fair market foley was even greater. the postal service owns a real-estate and premium locations for example to the nearby national postal service

has $47 billion but the assessed value of $304 million. if this is an example of the fair market value tax payers are well protected and a surplus of access would likely begin of an over to the treasury of the postal service were shut down. there are provisions that may allow the postal service to work to fashion an appropriate arrangement to recognize the assets and the obligation. against the backdrop the postal service continues to be billed the $11 billion every year for every ty cherry obligations instead of taking the cost of the fund created for that purpose. as i testified before, i agree with senator collins colin september 2010 for the change of copulation as the postal service pension fund payments. failing by opm senator carper's bill to require the recalculation to correct the mistakes and balance the account is desperately needed to stop

the crippling payment. there's an overwhelming need for substantial objective review of the benefit plans and payments this will allow construction to clear, fair and accurate financial map for the postal service future course otherwise the postal service will be build into insolvency weigel over funding its benefit funds. thank you. >> thanks for your testimony. thanks for the work that you've done and continue to do. mr. guffey, please proceed. thanks for joining. >> and cliff guffey president of the american postal workers union. i am pleased to participate in the hearing today with the representative margaret cigno and inspector general williams who have through their hard work dedication and leadership, much to preserve and protect the postal service. as a chairman of this committee knows legislative relief is necessary to restore the financial stability of the postal service. the p.w. appreciates the

leadership shown in proposing legislation there will meet the postal service critical need for the immediate financial relief. we strongly support and the entire coastal communities strongly supports the proposal to permit the postal service to use more than 5 billion each year from its overpayment in the civil service retirement account to meet its obligation to refund postal retiree health benefits and pay workers' compensation obligations. it bares emphasis that this is not a request for a subsidy or bailout of the postal service. the postal service says been dealing with the challenges because of the decline in mail volume. we are confident under the leadership of postmaster general donahoe and will continue to do so. the exhibit to the testimony is a chart that shows the postal service income for fiscal year 2007 through 2010 as the chart shows during this period that included the most severe recession since the great depression the postal service

had income excluding the health benefits refunding payments of more than $600 million. and only of a government agency could they refer to that as a little amount of profit. that's profit. this was achieved by the postal service through aggressive cost-cutting measures. over the past three and a half years the postal service reduced the work hours by 245 million hours and cut costs by 12 billion. it will cut another 30 to 40 million this year. the historic collective bargaining agreement concluded in the postal service would save the postal service billions of dollars and provide the necessary work force and work force flexibility. thus the postal service has shown the capacity to sustain itself during difficult times of declining volumes when it cannot sustain is the burden of the unique in a reasonable requirement that a profound thought health benefits over without access by which it has

overfunded. from 2007 through 2010 when it would have had a financial surplus the statutory leave required payments for the health benefits totaled nearly $21 billion. in fiscal year 2010 the payment for their retiree health benefits consumed 8.2% of the postal revenue. with additional payment of 2.2 billion to fund the retiree health benefits for current employees augment the postal service was required to pay 11.5% of its revenue for the health benefits. these payments deprive the service of the capitol needed to improve and maintain the distribution networks and develop and launch products and result in a debt. i want to emphasize we very much appreciate leadership of the german addressing the issues over funding and the health benefits refunding. we also appreciate the fact senator collins introduced legislation that will address the issue.

from the retiree benefits requirements and encouraged the fact the members of the house also introduced bills that would deal with these problems. there's a broad strong consensus in the community to support the measures. there's also a broad consensus to support proposals to revise the provision on offering products to permit to partner with state and local governments to offer additional government services and facilities and accept for shipment. we also support to help it get the changes and communications while continuing. the measures will help the of revenue and help maintain postal network that can deliver services to every part of the country. where the american flag flies at a rich community in the country and to take those flags down and replace them with a grocery stores or gas stations should be

the last alternative into those postal facilities. we will help any way we can for the legislation to address at the expense of the employees. i will be happy to answer any questions the community may have >> thinks mr. guffey and you are recognized please proceed. >> members of the subcommittee, thank you for inviting the national postmaster general to the to his authority. it's a pleasure to be here really commend you for holding the hearing. my name is mark strong and i'm the post master of arizona, a very large urban post office. i'm the president of the league. i'm originally from montana and served many small post offices. founded in the 19th centuries the association that represents postmaster's through the united states. dixon and how to address the postal service financial crisis it is critical to understand why the postal service finds itself

in the position that it does today. it's not because of electronic diversion of mail but electronic diversion has slowly been pulling some mail out of the system but that has been with us for decades. electronic diversion was a factor 30 years ago, was a factor present during the recession and will be a factor for years to come. electronic version has been and is the fundamental factor of postal life and hasn't changed much in recent years. the largest factors that caused the crisis are the recession and the fact that the postal service has to make annual payments to refund the retiree benefit obligation even though there are surplus funds in the pension plan. today the postal service is still running a deficit mostly because of the retiree health benefits payments we are making. we wouldn't be running the deficit if we were not paying 5 billion plus into the health benefit fund despite the fact that there's 50 to $75 billion

surplus sitting in the pension fund. senator carper's bill and senator collins bill would fix the problem and we strongly support those efforts. in fact, the lead was one of the original supporters of senator collins bill. without substantial relief in this area the postal service cannot continue as a viable entity for long term. no business of any type in any part of the country could afford to pay $5 billion supplemental annual income tax as competitors do not pay and remain viable. one reason the postal service should not do is close the small post offices. as senator collins will tell anyone, small rural post offices are the keystone of many communities and keeping them open costs the postal service a very little money. according to the datacom and we recently checked this, the total net cost of the 10,000 smallest post offices morgan once third of all post offices in the united states is less than seven tenths of the total cost for the

united states postal service. this is nothing. it around in iraq in the spreadsheets closing small post offices does not save the postal service in the significant amount of money but it is one of those cost saving measures that is popular with middle level postal officials because they can look good and give the impression that they are driving large costs out of the system. closing post office is not popular with american public as indicated in my testimony according to the 2010 gallup poll, 86% of americans oppose closing post offices. this is overwhelming nation wide endorsement of post offices of consistent with the 2009 gallup poll which showed 88% of the public proposed closing post offices. i've shown in my testimony few other government services rank this type of importance in the public mind. the reason for this is that as detailed in my testimony come

post offices and post masters do much more than sell stamps and deliver mail. they perform all sorts of other functions and are the glue that binds america together. although it is sometimes difficult for urbanites to understand this, those words, the glue that binds rural america to get there are not empty words or useless rhetoric and they are not gross exaggerations. they are the truth. if you allow the service to close substantial numbers of the post office then you will seriously hurt america even if the postal service could provide adequate postal service which helped them which it cannot do. one way to maintain is to allow them to sell other products such as the office supplies in order to offset some of their costs. senator carper's bill would do this. this has a minimal problem of competition in the private-sector since there would be no local competitors in most of the rural areas. thank you for considering our views and i will take any questions.

>> please proceed. >> good afternoon, senator carper. >> we have about 15 minutes. >> a leading trade organization for markers and nonprofits reaching consumers directly members represent about 78% of the mail and 80 present of the postal service revenues. they're an important communication channel for all of the members and those of the magazine publishers and nonprofit mailers and the 21st century. and it's in the financial crisis. we agree with you on what you've done on the pensions, the pension obligations for every hour that is worked in the postal service has been fully funded by postage that we've paid. we also pay between 50 to $75 billion in the pension obligations for the hours worked

before the postal service was ever created and that is a tax base also overpaid in the payments and we asked these overpayments be used to offset the retiree health payments that are currently harming the cash flow positions in the postal service. we think the legislation should require the governors to use any tension over the payment refund for the retiree health benefits until those legacy costs were completely funded. the facilities we agree with you on the post act to give the postal service more flexibility and the use of the kiosks and others of retail services to the american public. we also supported senator collins as the coal location of the postal facilities and other retail outlets and vice versa. kuhl locating with federal, state and local governments as

well. we support the positions on the post ek and we think the postal service should work with and partner with the private sector expertise on those products rather than starting out from scratch we want to commend the postal service trying to and the summer sale of the code postmaster general will keep up and bring some more. we support the provisions in s. 353 requiring a cost-benefit analysis for any new meal preparation requirement. and if that cost-benefit analysis shows there is a shift of cost to the miller we think that that should be considered as a rate increase under the cap there are concerns with the post act. first, we think that the powers

given specifically to the governor's should not be delegated. there's a reasons they have persons appointed governors. delegated we also believe that the 45 day decision requirement on the postal regulatory commission for the transfer, just for transfer of products from the market dominant competitive and vice versa is short. transfer between those provisions can have serious consequences for the members. we believe that ending the period would not harm the postal service because that product is still being offered looking at the transfer. finally the postal service has to deliver 150 billion pieces of mail rather than 250 billion we

can't afford that capacity, and it has to be done today and not tomorrow. thank you. >> thanks for your testimony in a think all of you for the valuable testimony. i just wanted to share on the subject of whether or not the world has changed in the electronic media i was just over in afghanistan and pakistan senator begich and i know scott brown and i have been over there a year or so ago. i think about what the world was like when i was serving in southeast asia during the vietnam war and, important to us and the squadron how important it was to us just to hear from our friends and families back home to get letters, cards, we were stationed in california overseas and on the san francisco chronicle about five

days late to receive time about four or five days late and when i was over in afghanistan two or three weeks ago i saw the soldiers and sailors and airmen and marines skyping. they can access this in francisco chronicle through the internet or "newsweek" and pay their bills electronically. the world has changed and continues to and for us hot we have to have a postal service. it doesn't continue to add to the budget deficit and the idea that with or of this people opposing closed office at the to post offices at least that many people also oppose running huge budget deficits and they want us to do something about that and what we have to do is come up with a way to continue but at the end of the day to not add to our budget deficit the next ten years i think we can do that in

the challenge to figure out working together how to do that and think outside the box. let me go to senator begich and then i have a question but i ask no more than five minutes. >> i'm going to make some general comments and because we have a vote in our title the schedules i think there is a recognition between the last panel and this panel, and to use your words they are the right size for the times we are in today and that is a challenge and i think the bill that senator carper has brought forth is a good step. there are obviously tweaks that need to be done. as a matter of fact mr. strong, was in alaska not long ago meeting with the postmasters. it was an interesting -- they had no conference room so we had to do the meeting in a restaurant bar which i thought was appropriate because we had a great discussion at lunchtime but what was good is the talk about it especially in alaska, and i just want to really say to

all of you that you will find me in trying to solve this problem and on the pension issue i've dealt with this when i was the major we had the free pension programs police and fire, two of them were underfunded, and we've restructured and the city no longer had to pay a payment because we've restructured it and became more satisfied in the long term benefit they received there was a win-win all the way around and they were highly unionized police and fire folks but it was painful getting their to be frank with you but at the end of the day we figured out and worked out better so i think the approach again mr. chairman there's going to be some work to do it that's why this hearing was good to hear from you. my son and ii like having him collect stamps because there's history behind each stand and

last thursday went to the post office website, ordered some first edition stamps and they came on monday. when you think about that, that shows the efficiency you have to organize it, package it, put it in, deliver it and we got it, and that is just an amazing thing, stamped envelope on the can stand from here and a village in western alaska is amazing so i credit the post office. thank you mr. chairman for allowing me to say a few words. >> we look forward to working with you on these issues. one question and this will be for maybe mr. guffey and mr. strong to members were directly with postal customers every day as we all know? what do you think the postal service needs to do to reach out to customers with their

individual customers or the biggest out there to attract new business? what do we need to do to attract new business? >> one of the problems we are facing for many years as a world work rules have gotten in the way to prevent the post office from staying open until 5:00. there's a post office and at 18th and king but they closed at 5:00 the people bringing it on the mail packages and what have you just miss out. they must go to one of our inhibitors. we changed the rules to allow the post office to stay open longer without the payment of overtime and doing certain things. we also lowered some costs of the new employees and longer-term benefits so that the postal service can open and where there are clerks working can lower their costs and keep the post offices open longer in the general community rather than shutting them down because the cost factor in other words we try to help the cost factors.

we must be -- we lowered the cost of processing inside plants. we tried hard at that so the big mailers could keep their discount and bring more mail to the post office to keep the cost down. the man and women of the union are very concerned about the post office and they want to help it to be a viable institution and the overwhelmingly voted to do those types of things. >> congratulations, thanks. mr. strong? >> a number of things. i had the privilege of being on the panel a couple of weeks ago and i talked about the complexity of the bulk mail units where the customers come in and it is a very complex operation, and i think we have to reduce the complexity to make easier for the occasional user to conduct mail into the system but one of the things gerry brought up is the fact we have to look at the complexity of the window, the retail services selling the products we

currently have sometimes can be a struggle only for the customer to understand but the retailers' receipts so we have to reduce the complexity of the operation as well. we already have an outreach program where we have deposed ministers involved and it is a customer connect don't reach. we need to expand and continue to grow that and get all of our employees involved. postmasters are great salesman. we need to continue to get them into the field and sell the products we have and get them the time away from the desk to get that done. i think we can, i think we have the people to do with and the product lines to continue to grow and be a vital part of america and work at that. >> i'm going to run over there and vote. about five minutes to go so i'm going to go.

thank you so much for joining us today and for the preparation and hard work you do every day to help make sure that we have a strong and vital postal service. i would like to quote who said adversity lies opportunity, and i think there's plenty of adversity for the postal service but there is also opportunity and it's incumbent on each and every one of us to find that opportunity and work together thinking outside of the box to come up with opportunities we never thought of before and when i see my neighbor is getting of those netflix and my wife being delighted to receive a mother's day card from the other side of the world or when i see flat rate boxes the postmaster general is holding up, when i talk to folks the medicine is delivered six days a week to the

mailboxes there is a lot of good ideas out there some of them realize, a lot of them haven't online and with respect to the energy cost the last thing i want to mention is we didn't touch on this but it's part of the 800-pound gorilla in the room in terms of driving federal budget deficits the cost of health care, the cost of health care. and its minimum to beat one of the major drivers and 80% of the gdp for health care costs they spend half of that 9%. they cut into get better results. we can't be that dumb but part of our challenge is to figure out how to get better health care results for better health care results for the same amount of money and that is a issue for another day but it's an

important issue as we deal with this one today. so i look forward to working with my colleagues here today. those that weren't certainly look forward to working with senator collins. we are going to figure this out. it's not going to be tomorrow or next week but we will figure this out and we will figure it out this year. that having been said, this hearing is adjourned. thank >> and we're going to take you now to olympic park in atlanta, georgia, where 2012 republican presidential candidate herman cane is frm formally kicking off his campaign. here's the crowd. mr. cane has made several trips to some other states, new hampshire and iowa for early primary caucus states. he is a former god father's

pizza c.e.o., radio talk show host, and chairman of the reserve bank in kansas. in the meantime, let's take a look at this morning's questions and comments from washington jorle. on this saturday, scenes like this one playing out throughout the country. it is college a timely editorial cartoon in the "washington post" -- actually this is the "atlanta journal-constitution." you'd think he is handing out diplomas but it is actually lottery tickets. there is one interpretation of what is going on these days and the college area and the real world. this headline as well in the

"wall street journal." nicosia picture here from new students at the university of michigan, celebrating their commencement. but the recent that this year's college students have better prospects than their peers did a year ago, as lg as they are looking in the private sector. employers plan to hire 90% more graduates this year than 2010 according to a survey -- a lot of detailed information here which will be brought out to you in the next 40 minutes. his college worth it? we have been following commencements throughout the country. we will air them on memorial weekend, saturday, sunday, and monday. we got this idea up from a poll

put out by the pew research center last week. they have talked to college presidents about the value and quality and mission of higher education. they talk to over 2000 people and their take away deals with cost and value. they're right that a majority of americans -- the right -- they write -- lots of different opinions out there on whether college it worth it. mike is our first call from baltimore on the democrats' line. good morning. you are on the air.

caller: i do not really think college is worth it these days. for the simple fact, let me give you the example. let's justay black people, they would teach you how to fish, but universities, it seems like they give you a book on how the fish and then give you some answers and say, you did not get a ride, it give me your money and that is said. this young generation, you can go on to youtube and watch videos and things like that. you need to new -- find a new way. but all of these test in these universities, they seem like they want money and they are not educating. and one more before you hang up on me. host: go-ahead. caller: we talk about the mide east thing, the truth of the matter, that 12,000 israels that

were dominicans and indians, there were 12 of us. with all of the 12 tribes, if we would go back to israel, it would stop the middle east peace in the jews could come over here. host: we want to move on to this topic at hand. plenty of time to talk about the middle is coming up at 7:45 a.m. today. josh rogin will be here from "foreign-polic" the question right now, is college worth it? if you want to share your situation with us, let us know. alistair life turned out based on your can -- your situation. another call from baltimore, steve, an indendent. caller: i think we need a better balance. we have tens of thousands of people supplying us with needed

skills in the non-college areas. we need those people and we are not giving them the opportunity to get training. our schools are becoming like private education systems where we crank out many people who have no skills. and yet we are creating worker populations, people who come over here killing tens of thousands of very good jobs, and we are not training our own people to do that. we needed balance. host: a balance is the argument there from steve. is college worth it? caller: it is worth it. booker t. washington, one of t great black educators made sure that the people going to the black colleges were both educat and had a skill. every n came out and every

woman came out with a skill. i met teacher of autism. without college, i would not be where i am. without a college education, you are really nothing in our society. host: more of your calls coming up here. some more facts and statistics as pew research center released with its poll. is college more affordable? 22% of digital public says that it is more affordable. college presidents have a different and you. . -- have a different view. how which you rate the jobs of higher ecation? how're they doing in providing value for the money spent?

>> we leave this now to head to atlanta, georgia, the hometown of herman cane to announce he is in the running for the g.o.p. presidential nomination. and he is introduced by martha zoler. >> it is great to see all of you here to welcome herman cain into the race for president. there are three thing that is you need to know about herman cain, and i'm going to tell you also, herman and i had a little lunch where he tried to teach me a little bit about public

speaking a few years ago, and he told me you always have three things that you're going to say. but three things about him. first of all, he is a man of integrity. you know that herman is going to say what he means and do what he says. he's going to be plain spoken. and you're going to understand. and you know what? i think it is a plus for him that he is not from inside the beltway and he has not been in a -- [applause] and i've got to tell you what you're seeing here today, what the gallup poll found out is that he may only have 29% name recognition, which we're going to change. right? but he has the most enthusiasm of his supporters of anyone out there.

the second thing you need to know about herman cane is he is a business man. he knows how to balance a budget. he knows what to do when times are bad. he knows what to do when times are good. plan for the future. he knows what to do. he is a guy that is going to put first things first as far as the federal budget is concerned and he is a guy that knows how to make it happen. his personal story, which you will hear from other people, is so compelling. because he started from nothing. and i don't want to say nothing because he had a loving family and that's not nothing. he had a loving family. he still has a loving family. and he is a man that is living the american dream every day. it is not dead. he is also a man that

understands everything about what it is to fix this nation from the inside out. and that is coming from a moral character that he has. he understands the difference between right and wrong. and i guarantee if he makes a mistake along the way like all of us do he is going to be the first one to tell you. and that's what he we want from people. we don't expect perfection. what we want is someone that's going to come to us and say, you know what? this is what we did wrong and this is how we're going to fix it. so i'm happy to be here emseeing in event today. it is a terrific day here for atlanta, for georgia, and for the nation. and now we're going to start this the right way. we're going to take it to god. and british pp harry jacks --

bishop harry jackson is going to come up here. please join me in welcoming bishop harry jackson for our invocation. >> bless you. greetings from the good side of washington, d.c. in our tradition we would like to read a scripture and then simply take us to the throne of grace. the word of the lord says to eye saya 58959, verse 14, justice is turned back and righteousness stands far away. for truth has stumbled in the streets and uprightness cannot enter. yes, truth is lacking. and he who turns aside from evil makes himself afraid. now, the lord saw and it was

displeasing in his sight that there was no justice. and he saw that there is no man and was astonished that there was no one to interseed. then his own arm brought salvation to him and his righteousness uphe would hymn. would you bow your head with me, please. heavenly father, we thank you that you have raised up herman cain for this day. that you have appointed him for this hour. as a spokes person and a representative of your agenda. and of the values that america has always held dear. and so out of the same passage, we pray for him and declare for herman cain, arise, shine, for thigh light has come and the --

and the glory of the lord has risen upon thee, herman cain. and then we pray that his people will be willing in the day of his power, lord, that you are going to give the people in this place a volunteer spirit, they're going to rise up, they're going to volunteer, they're going to give finances, they're going to begin to speak out passionately. and at the end of the day, we are going to see that you are aligning a vertable army around this man, herman cain, because righteousness, justice, and truth need to be restored to america. we pray and believe we received these things for we have prade in the name of jesus. amen. god bless you. [applause]

>> good afternoon, atlanta. i'm colonel mike kneel. [applause] what a great day to be american. [applause] i need to be candid with you. that i was very excited and i was very encouraged to recently learn that the man responsible, primarily cuppable for the events of 9/11 had been found

and been brought to justice. [applause] over the last few weeks, i have pondered that event and every time, every single time i have found myself returning to think of the selfless service and the sacrifice of our service members. [applause] [cheers and applause] service that begins with them standing, raising their right hand and taking an oath before god. saying i do solemnly swear that i will support and defend the constitution of the united states against all enemies, foreign and domestic. [cheers and applause]

i would offer to you that when we as american citizens say i pledge allegiance, that we are also taking an oath, an oath of loyalty, and oath of commitment, an oath of service, something that's not to be taken lightly. and i would ask that today, particularly today, given the significance of the event that we are here with herman to share, and given the fact that our nation stands at a political cross roads, at a pivotal seminal point in our nation's history, given the context of today, i would ask that every one of us would take the time to consider every word of our pledge, and that we provide adequate time to think through the implications to every one of us as individuals.

i would ask that you stand to your feet and just like our service members, raise your right hand, place it over your heart if you're a veteran you can render honors, of course, and that you will recite the pledge of allegiance facing the flag with me. i pledge allegiance to the flag of the united states of america. and to the republic for which it stands one nation under god indivisible, with liberty, and justice for all. [cheers and applause] may god bless every one of you for your commitment to this nation and our fellow citizens. [cheers and applause]

>> ladies and gentlemen we ask that you stand for the national anthem and welcome lewis schafer. there will be two verses. >> ♪ ♪ ♪ ♪

♪ ♪

♪ [cheers and applause]

[applause] >> thank you. please be seated. what a terrific job on the stars spangled banner. one of the most beautiful sings we've ever sung. you know, i am a country music fan, much to the chagrine of my children. sometimes they say, what has happened to you, mom? well, it's because they have great lyrics. you know, i'm a gal of the

70's, and i loved all those blaleds in the 70s with the great words and i loved singing along. so it is my pleasure to introduce to you now rick monroe. he is going to be next week a team member in the alaska healing hearts. he has used his influence in country music for a myriad of really good causes. his new single is "get your country on." and we want to welcome rick monroe. [cheers and applause] >> how are you all doing? it's amazing what a little bit of clean speaking and smart minds will do for people out here tonight. right? so are you guys ready to raise a little cane today? oh, yeah. all right, you guys. we'll start off with a little song that's a little summer

song. ♪ ♪

♪ ♪ ♪ ♪

♪ ♪

>> you know, i'm going to say herman, you say cain. herman. >> i got lucky enough maybe by mistake but cmt played one of my songs, i figured being in georgia it's a good idea. you might know this so sing along with me. all right? all right. check it out. ♪ ♪ ♪

♪ >> are you looking forward to the announcement? what dounchings he's going to say? all right. i'm not going to play, i'm just going to sing. and i'm going to expect you to sing this last verse with me. is that cool?

come on. ♪ ♪ >> do i keep playing? what do you guys want to do? i guess i'll keep playing.

we're going to have some kind of break and play two more. but -- >> he remember b cain is just -- herman cain is a person who shoots straight from the hips. you can depend on it if he says it. and i like the fact that he is a grandfather, a father, a businessman, a man of character and integget, someone who is steady, stedfast and yet contemporary. someone who can speak to everyone across the generation. someone with values and work ethic. and i appreciate everything that he brings to the table. he and his family. and i know that's what america needs. ♪ ♪ >> i guess thast that was it. that was cool. what do you think of that? >> i've got two more songs. this one is called "get your

country on." ♪ ♪ ♪

♪ are we about ready to get our country back on? ♪ ♪ it's about time for us to take this country back for sure. no doubt. ♪ ♪ thank you all.

i've got one more then we need this announcement. we need to find out what mr. cain is singing about. right? this song is a song i wrote several years ago when someone was trying to take "in god we trust" off our money and all that crazy stuff. i don't think i've ever played this song live but i figured this would be the perfect time with in? it's called "one nation."

i'm pulling out just for this occasion. ♪ ♪ ♪ ♪

♪

♪

♪ >> all right. i think it's about time we get mr. cain out here and find out what's on his mind. right? let me hear you say yeah. all right, you guys. god bless you. thank you very much. >> mied dad left the farm at age of 18 with just the clothes on his back. mom was a domestic worker.

dad worked three jobs to put food on the table. he saw my brother and i graduate from college. he bought his own home. that was his american dream. when the doctors told me i had stage 4 cancer, and that i had only a 30% chance of being here today, i got a second opinion. it wasn't easy, but i am now totally cancer free. the pills bri company made me

c.e.o. of god father's pizza, i didn't get the memo that the company was headed for bankruptcy. it wasn't easy, but we turned the company around. today, i am announcing that i am running for president of the united states of america. we believe in god, if we believe in ourselves, and we believe in the united states of america, then we can do great things. it won't be easy. but we can turn this country around. our children and our grandchildren will know greater success and greater opportunity. there is no greater force on earth but the united will of the american people. the sleeping giant, we, the people, have awakened. we will make america great again. but i need your help. this is our campaign.

of the people, by the people, and for the people. the founding fathers did their job when they created the declaration of independence and the constitution. let us do our job as the defending fathers of these great documents. let us remind the world that our rights do not come from a man nor a committee nor a czar, but from our creator. we will preserve and protect these rights for our children and our grandchildren. we will preserve and as sure that these united states of america, the greatest nation the planet has ever seen, will not compromise her legacy. she will not accept debt nor meed okty, and she surely will never ever go quietly into the night. not on our watch.

this is my new american dream. may god bless you. and may god bless the united states of america. >> ladies and gentlemen, please welcome mr. herman cain. [cheers and applause] >> lovia. love yeah.

love ya. love y'all. love y'all. my, my, my. love you. i've got to tell you, let me thank you. i see some people out there, a few back there yelling. and i understand that my aunt bessie is here. oh, there she is. now, do you know why it is so momentous that my aunt bessie is here? she hasn't decided if she can vote for me yet. but i'm going to change her

mind. just like we are going to change the mind of a lot of folk in america. but i want to thank all of you from the bottom of my heart for you being here. because there was some skeptics, as you know, who didn't think anybody would show up for an announcement for me. and the last time i heard, there are 15,000 of you all right here. thank you. thank you. you know, it has been this kind of encouragement that has gotten me to this point. and it is this kind of encouragement that i believe

and i know is going to take us to where we are trying to get to. you know, many of you know that i grew up right here in atlanta, georgia. right here in atlanta, georgia. i stand in the shadows of my upbringing. i stand here today as the son of a shaufer and a domestic worker, who taught me and my brother three of the most important values we could have ever learned. belief in god. belief in what we can do for ourselves. and belief in this exceptional

nation called the united states of america. believe in it. you know, the people that are struggling the most are the ones who don't believe in this nation. they don't believe in the values of this nation. my parents never uttered the words victim. because they never felt like a victim. having the opportunity to be in this nation despite its challenges. so i stand here today as luther and len ora's oldest son. in my hometown. i stand here today in this hour , in the shadow of the owe limb pick flame which represents not only the determination of those

that go to the ome limb picks every four years with their own determination. but it also signifies the great spirit of this great country, the spirit of america. that's what it signifies. and it is the spirit of america and the determination of america and the determination of its people that we are going to take our country back. we're going to take it back. this day, this hour, in the spirit of america, and the spirit of the olympics here in this park. when people go to the olympics

every pour years, they don't go to the olympics to come in second. they go to the olympics to win. and you see, just like the spirit of the olympics, number two is not in america's dna. we don't do number two. right here, this day, this hour, this moment reminds me of the words to the closing song of the 2000 olympics. life can be a challenge. life can seem impossible. it's never easy when there's so much on the line. but you and i can make a

difference. there's a mission just for you. there's a mission just for me. just look inside and you will find just what you can do. right here this day, this hour, and this moment, i have looked inside of me and at this moment this day a amongst thousands and thousands of my friends and with my family here with me, and associates that i have known throughout the years, this day, this hour, this

moment i came here to declare my candidacy for the republican nomination for president of the united states of america. this moment. this moment. and just to be clear, just to be clear, in case you accidentally listened to a skeptic or doubting thomas out there, just to be clear, let me say it again. i'm running for president of the united states.

and i'm not running for second. [cheers and applause] i'm not running for second. one. this day. now, let me tell you, because i've had reporters ask me sometimes, well, are you running just to get attention and maybe come in second or maybe to get a cabinet position? i said, you don't know very much about me. you don't run for second. i don't run for second. running to be number one. now, let me tell you some of

the reasons why i am running for president of the united states. one of the biggest reasons is that we have become a nation of crisis. we have a moral crisis. we've got an economic crisis. we've got an entitlement spending crisis. we've got an immigration crisis. we've got a foreign affairs crisis. and we've got a deficiency of leadership crisis in the white house. there. there is a big difference between leadership and positionship. a big difference. between leadership and positionship. let's look at the facts. relative to all of these

crises. we have anemic economic growth. in the first quarter of this year, our gdp only grew by 1.8%. that is anemic especially when china is growing at 10% compound. and if we don't increase our growth rate, they're going to be as big as we are in five years if you take out the differences in exchange rate. and like i said earlier, if we allow china to become as economically powerful as us, you know that they're going to try to develop their military might as big as ours. and i don't know about you, but i am not going to allow america to be number two in the economy or number two militarily. not on our watch. not on our watch. we are a nation of crises.

look at the facts. don't listen to the rhetoric. a 9% unemployment rate with nearly 15 million people out of work. 47 million people on food stamps. that's 14 million more than there were when the current occupant of the white house took over. $4 a gallon for gas. and it's not over yet. $1 trillion in spending to stimulate the economy and it didn't stimulate didly. all of that and now to have a $14 trillion national debt and the debate in washington, d.c. is going on about do we raise

the debt ceiling? again. let me tell you what the cain doctrine would be. we ain't raising the debt ceiling. we are going to cut the spending. it's call reduce. so look at the facts. don't just listen to the rhetoric. look at the facts. the stuff is not working. it's not working. so the only thing that i can conclude is it's time to get real, folks. it's time to get real. hope and change ain't working. hope and change is not a solution. hope and change is not a job. hope and change is not a new business. hope and change is not a

vision. we need a new vision in this country. and that means we need a new person leading this nation in the white house. [cheers and applause] it ain't working. i want to ask you a few questions. is america ready for real results? is america ready for common sense solutions? is america ready to rekindle the spirit of america? and is america ready for a real leader, not a reader? [cheers and applause] you want a leader? or you want a reader?

now, since -- [chanting] i know it took some people to connect the dots on that last statement. some were a little slow but they finally got it. now, since you answered yes to those questions, let me describe our new vision. i don't call it my vision. my job as a leader is to define it, share it with you. it becomes our vision. because you know what somei can't do this by myself. this has to be our vision, not

a political vision, not the agenda of one person, but it has to be the agenda of the people of this country. i call it our vision. and in order for us to be able to achieve and make reality out of our vision, we're going to need some new plans, set some new priorities, and certainly get some new people around the president, this president, that's much better than the one we've got. in terms of vision. our new vision, real economic growth, not anemic growth. and in order to do it, we've got to lower tax breaks for corporations and individuals.

we've got to take the capital gains tax to zero. we've got to give the people of america a real payroll tax holiday and then put around it and make the tax break permanent. that would be economic growth. our vision. a real independence plan. a real one. not one that somebody just reads off of a teleprompter. no. a real one. one of the things that's so frustrating about it is that we have the resources to become energy independent. we simply need to pull the resources together in order to make it happen. that's our vision. you know, i will never go to a foreign country or brazil, loan

them money, and then tell them we are going to be their best customer for their oil? let me share with you another one of the cain doctrines. america is going to be its own best customer. right here in the u.s.a. we will be our own best customer. and as president of the united states, i'm going to make sure that we are our own best customer when it comes to our energy needs and our energy resources. it's not that we don't have the resources, we've just got too much bureaucracy that keeps getting in the way. our new vision.

means immigration through the front door and not through the back door. not through the side door. . .

that's how we take care of that problem. and the last thing that you will get from a herman cain presidency is sewing the state that they are trying to protect themselves. we shouldn't sue arizona. we ought to send them a prize. a peace prize! [cheers and applause] sewing a state of the united states of america. there's a major disconnect. our new vision, real energy and economic growth, real energy independence. immigration through the front door, the side door or the backdoor. and then real clear foreign policies. [applause]

real clear. i love it. -- when the skeptics want to criticize me because of lack of foreign policy experience. let me tell you what i know about foreign policy experience. i know that you don't throw your friends under the bus. [cheers and applause] that's what i know about foreign policy. you don't have years in the step to figure that out. -- state department to figure that out. know who your friends are. know who your enemies are. and don't throw your friends under the bus. [applause] i was shocked last week. i think it was thursday. when president obama threw israel under the bus.

let me tell you what the cain doctrine would be relative to our friends and i'll share with you later my doctrine relative to our enemies, i got some stuff for them too. but relative to israel, the cain doctrines to the world was -- would simply be if you mess with israel, you're messing with the united states of america. don't mess with us. [applause] don't mess with us. is that real clear? is that real clear? that's what i mean about real clear foreign policy. know who your friends are.

know who your enemies are. and it's our new vision. it's not the establishment. it's not the politicians. it is our new vision. and lastly this nation has gradually over the years slipped into an entitlement society. well i got to tell you, folks, not only do i believe it is possible, but i also know that it's time we'll restructuring programs instead of reshuffling programs we can take this entitlement society into an enpowerment society. empower people!

empower to the states! empower businesses. we can become an emparliament society with our -- enpowerment society with our new vision. the founding farce, they did a great job and they september it simple. they wrote -- they kept it simple. they wrote the declaration of independence. they designed and wrote the constitution of the united states of america. and one of the other things that's part of our vision is that we don't need to rewrite the declaration. we don't need to rewrite the institution -- constitution of the united states. we need to reread the constitution and enforce the

constitution. [applause] we don't need to rewrite. let's reread. [applause] and i know that there's some people that are not going to do that. so for the benefit for those that don't want to do it, there's a little section in there that talks about life, liberty, and the pursuit of happiness. you know those ideals that you believed in. your parents believed in. they instill to you. when you get to the part about life, liberty, and the pursuit of happiness, don't stop right there. keep reading of the because that's when it says when any form of government destructs those of the ideal it is the right for the people to own the thorship. we got some altering and some authoring to do. [applause] in 2012, we will not only going to keep control of the house of representatives, we are going to

halt the control of the united states senate and take and in -- and take it back. and in 2012, we are also going to run the trifecta and amounter the occupants of the white house are a new president. and lastly -- thank you. and for sure, we all going to have to work a little harder. we're going to have to work a little smarter. we are not going to convert everybody over to our conservative way of thinking. we are not going to sell

everybody on our new vision. with new leadership, new people, new ways to think about it. but as a good friend told me once, all you can do is save the saveable and you know what? between november now and november 2012, i think i'm going to save my aunt besidey. [laughter] -- bessy [laughter] . i think she's got hope. we got a lot of work to , do folks, but i believe we can do this. if i didn't believe we can do this, i wouldn't be doing it. so we all got to work a little bit harder in order to take back this country. it's going to be tough. i'm up for the fight. i'm up for the challenge and i know you are too. [applause] the founding fathers, the founding fathers did their job. we have to do our job and be the

descending fathers. and i have been blessed with two adult kids. they're grown and gone. we've got three grand kids. and it's not about us. it's not about us. and i know that everybody here feels that way. and for me, traveling all over the country and talking to groups day in and day out, town hall meetings, large rallies, big rallies, small rallies, the message has been consistent. it's not about us. and people are ready to do whatever it takes in order to take this nation back and i firmly believe in our heart -- my heart that god is in this journey. that god is in this johnsonmy. -- journey.

[applause] and in november of 2012, the day after the election day, when we wake up that morning and all of the folks are counted, and they declare not only all of the locally -- local election result, the statewide election results, the congressional results, the senatorial results. but when we wake up and they declare the presidential results and herman cain this the white house, we will all be able to say free at last, free at last! [cheers and applause] thank god almighty! this nation is free at last! again. god bless you. god bless the u.s.a. [cheers and applause]

>> cain! cain! cain! cain! [cheers and applause] >> thank you. thank you very much. this is my family, along with you. and i wanted you to see them because this thing is going to move so fast you may not see them much. so you better look quick. thank you again, ladies and gentlemen. [applause] thank you. thank you very much. thank you. thank you very much. aunt bessie! [laughter] thank you very much.

god bless you. god bless you. stay tuned. god bless you. god bless each and every one of you. [cheers and applause]

[captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]

[applause] ♪ ♪

i amount america one voice united we stand one vote to heal our hand there is some work that must be done i do not rest until we've won i am america yeah ♪ you got us power you have no shame you're only interest is political game you hide your eyes ♪ >> and that's wrapping up herman

cain's formal announcement that he is going to be entering the g.o.p. field for the nomination for president in 2012. and i want to hear what you think about the latest candidate to enter the field. do you want to weigh in? before the speech, mr. cain showed a video. he talked about his time as a former c.e.o. of godfather's peta and he's chairman of the federal reserve bank of kansas city. he's 65 years old, affiliated with the tea party movement and believes in a strong national defense and replacing the income tax with a national sales tax. we're going to take your calls now. our first call comes from cleveland, ohio. and dylan, our democrats line. what do you think of herman cain's announcement? >> i wasn't crazy about it at

all. first, he seems to be proposing policies that we've been having for over the past 30 years. and we've seen how those have worked. we've lost our middle class. we have an uber aristocrat society with the upper 1%. that's pretty much what his proposal has led to. number two, he spoke an awful lot about liberty but said nothing about righteousness. number three, he said we have to work harder and smarter, said nothing about wall street stealing less. so i'm somewhat disappointed. >> we're going to go next to mike, republicans line. mike's calling from huntsville, alabama. >> thank you so much for taking my call. i'm excite ed aboutherman cain's candidacy. he's a man that articulates -- i

spent 23 years in office. i see him as a natural command for the chief. a man that's a leader and accomplished and a man that will talk this country far and a man that admittedly, he doesn't have foreign policy experience but i think he said the right thing particularly when he arc lated the cain policy about our friends. he said the right thing. he's got my vote. >> next, mary kay on the independence line in phoenix. >> hi. my name is mary kay. my company is bilingual services and i'm caucasian and i used to be a republican but we kind of went south with a lot of our stuff so i became independent so i could pick and choose a little more. i think we need another black president because the other one didn't seem to fit the bill but i know that if we have a republican black president, we might be able to beat barack. >> what do you like particularly about herman cain? >> i like the fact that he did

his business himself, rising from the bottom, i'm a small business owner in assurance so i can -- insurance and he is conservative enough and righteous enough and would be a great patriot in all levels i've listened to all the talks on fox and i think he's the man to be able to beat barack. we need -- barack obama. we need another black president to be able to beat the amount of democrats that would be voting. this is the only way to beat barack obama. >> herman cain formally announced he's running in the president. we will have it tonight at 8:00 eastern and you can also see it on the c-span video library which you can access online. let's see. here is a call from new york city, wanda on the democrats line. what do you think of the announcement today? >> totally disappointing. i feel that he's quite a talker. he sounded like a minister.

talks about issue but has no solution. and very disappointed that he is even considering being president of the united states of america. >> is there anybody in the g.o.p. field that you think is going to make it to the president? >> oh, darl, -- darling, i'm an obama girl. obama, obama, obama. he's got it right and he's going to get it right. >> we're going to go kathy in youngstown, ohio on the republican line. >> i'm very excited about herman cain. i've listened to him on different shows and i believe he will get our country back. i like the fact that he's a businessman and he can use that experience to run our country and get it fiscally back into shape. he's a conservative. and i just -- i like what he has to say and no, he didn't give a lot of substances to what he mean, he's announcing for

president and he's give you just a broad understanding of what he would like to do and i think the details will come out later as they usually do. so right now, he's my pick for the republican party and i will work for him. i'm really excited about him. >> next up, cassie in youngstown, ohio -- oh, sorry. it's mary from houston, texas on the democrats line. go ahead, mary. >> yes. he was saying he dent know anything about the foreign policy. if you don't know anything about the foreign policy, we're having all this war, how can he stop -- coming to the united states to bomb us up? don't forget 9/11 how they came in here and blow up wall street downtown in new york? we do not need him for no president because he don't even know how to take care of a foreign country at all. and obama has done a great job. we had two republic presidents there. neither one of them got hold of bin laden. when he got hold of the chair, he did what he did.

>> and mary, talking about foreign policy, just want to let you know we will be hearing from possible g.o.p. candidates, potential candidate, former u.s. ambassador to china, john huntsman and he's also the former utah gordon. he will be the focus of the white house at 4:30 eastern at franklin, new hampshire. tomorrow at 4:30. going to move on now to kansas city, missouri. shawn on the independence line. what do you think of herman cain? >> well, i think herman cain should be running president of the comedy central. i think he's a joke. >> anybody in the field that you think would make a good g.o.p. candidate? >> no. i think he should run for comedy central. >> ok. and let's go now to larry in

oak-week-old, california. what's on your mind? herman cain for the last five years and i've seen him on various shows and i'm a small businessman and start a non-profit and i like what he has to say. i think it's just -- we need to get back to common sense business, common sense attitudes in this country. i'm not happy with what obama has been doing. yes, he's getting a lot of credit for bin laden but it was just time for bin laden to get caught and a lot of work has gone into that. but i believe herman cain is a man and i'm going to find a way to start working for him out here in california and start making some inroads. i think he's a great man. >> thanks, larry. we go now of the democrats line and joshua in bradenton, florida. >> how are you doing today? >> good. what do you think about herman cain's mount?

>> i believe with one of your callers. he is a big joke. i think this is a employ to try to get -- ploy to try to get another black man to try to run against barack obama and believe he may be able to beat barack he's he's black. it shouldn't be about race. i'm an african-american. not because he is black. i like some of his views. i don't agree with some of the stuff he's doing. i'm in between the fents it's an outrage that this guy is coming along out of nowhere and is wanting to rub for president. i believe it's a ploy to run against barack obama because they don't have anybody else that they think should win. so i think he's a joke also. >> in 2004, herman cain did run unsuccessfully for the senate in the state of georgia. he wanted to fill the seat of the retiring democrat there, zell miller and mr. cain got 26% and the seat was evenly won by

republican johnny isaacsson. we're going to go next, let's see. sheryl is on the republican line in daytona, georgia. hi, sheryl. >> hello. i have attended many events where herman cain has been the main speaker in the atlanta area. he's not a joke. he's been here for over four years. he knows what he's talking to. he's very serious. this is not about races. unfortunately, the other side seems to want to bring that into effect and he is just a very smart businessman who knows what he's doing and he has a large following. he has been involved with the tea parties throughout this country and if you notice the crowd that was there, they were people -- there were people from all different walks of life and i think he knows what we really need which right now we do not

have. i just want to support herman cain and say there's nothing joke or funny about him. he is a good honest legitimate republican candidate. thanks. >> thank you very much. and we'll take a last call now. let's see, chris, joins us from man. . this was not because of his policies. i am going to switch. i am going to go with herman cain. >> thank you. thank you to everyone who called in to let us know what you thought about herman cain. just formally announced he is running for the gop nomination for president. you can see that again tonight. we will have it for you on that c-span at it o'clock.

another potential contender and the gop are arena, former you it -- u.s. ambassador to china jon huntsman. have live coverage of him at a meet and greet the new hampshire. tomorrow morning, our coverage continues with a round table discussion of the 2012 presidential race and what is coming up next with mark murray and jonathan alan of politico. president obama met with israeli prime minister benjamin netanyahu and in the oval office this week after his speech on israel and the middle east. the president deferred from the prime minister on the future of palestine, but he wants the israeli prime minister to consider returning to the 1967 borders to make way for an adjacent palestinian state.

he made remarks to the press for about 12 minutes. >> let me first of all welcome once again the prime minister netanyahu, who i think has now been here seven times during the course of my presidency. i want to indicate the frequency of these meetings is an indication of the extraordinary bond between our two countries, as is this an opportunity for the prime minister to address congress during his time your. i know that is an honor reserved for those who have always felt them to be a great friend of the united states. we have discussed the changes sweeping the region, and what is

happening in places like egypt, syria, and how they affect the security of the united states and israel, and the opportunity for prosperity, growth, and development. we agree there is a moment of opportunity as a consequence of the arab spring, but we also acknowledge there are significant perils as well. it is coming to be important for the united states as we see developments unfold. i discussed with the prime minister how important it would be for the united states to support political reform, more human rights, freedom of speech, religious tolerance, and economic development.

particularly in egypt as the largest arab country that started this revolutionary movement taking place throughout the middle east and north africa. we also discussed the situation and in syria, which is also of acute importance to israel given the shared border. i gave more details to the prime minister about the significance steps we are taking to try to pressure syria and the assad regime to reform, including sanctions. we continue to to share our deep concerns about iran, not only the threat it poses to israel, but also the threat it poses to the region and the world if it were to develop nuclear weapons. we updated our strategy to

continue to apply pressure and sanctions and our other diplomatic work, and as i reiterated, i believe it is unacceptable for iran to develop a nuclear weapon. we also discussed the hypocrisy of iraq, suggesting it supports democratization in the middle east, when in fact they first showed the oppressive nature of the regime when they responded to the wrong peaceful protest that took place inside iran almost two years ago periods -- their own peaceful protests that to place inside iran almost two years ago. finally, we talked about the relationship between israelis and palestinians. we discussed in depth the principles that i laid out yesterday, with the belief that our ultimate goal has to be a

secure israeli state, a jewish state set side by side in peace and security with a functioning and affective palestinian state. obviously, there are differences between us. the precise formulations and language. and that is going to happen between friends. but in complete accord of that -- trapeze can only occur -- true peace can only occur if the resolution allows israel to defend itself against threats, and that israel's security will remain paramount if the u.s. evaluations any prospective peace deal. i said that yesterday in the

speech and i continue to believe it. and i think it is possible for us to shape a deal that allows israel to secure itself, not to be vulnerable, but allows it to deal with our wrenching issue for both peoples for decades now i also pointed out as i said in a speech yesterday, that it is very difficult for israel to be expected to negotiate in a serious way with a party that refuses to acknowledge its right to exist and so, for that reason i think the palestinians are going to have to answer difficult questions about that. this agreement between fatah and hamas. hamas has been an organization

that has resorted to tehran, that has refused to acknowledge israel's right to exist, that is not a partner for a significant, realistic peace process. and so, as i said yesterday during the speech, palestinians are going to have to explain how they can credibly engage in serious peace negotiations in the absence of serving the quartet of principles of been put forward previously. so, overall, i thought this was extremely constructive discussion, and coming out of this discussion, once again, i can reaffirm that the extraordinary relationship between the united states and israel is sound and will continue and that together, hopefully, we are going to be

able to work, usher in a new piece of -- a new period of peace and prosperity in the coming weeks, months, and years. so -- >> mr. prime minister, welcome. >> thank you, mr. president. mr. president, i want to thank you and the first lady for the great hospitality you have shown me, my wife, and our entire delegation. we have an enduring bond of friendship between our two countries, and i appreciate the opportunity to have this meeting with hero after your important speech yesterday. we share your hope and your vision for the spread of democracy and in the middle east. i appreciate the fact that you reaffirmed once again now and in our conversation and in actual

deed the commitment to israel's security. we value your efforts to advance the peace process. this is something that we want to have accomplished. israel wants peace. i want peace. what we all want is a piece that will be genuine, that will -- is a peace that will be genuine, that will hold, that will endure. i think we agree that peace based on illusions will crash when faced with reality. i think the only piece that will endure is one based on reality, on unshakeable fact. the palestinians will have to accept some basic realities. the first is while israel is

prepared to make generous compromises for peace, it cannot go back to the 1967 borders. because these lines are indefensible. because they do not take into account certain changes that have taken place on the ground, demographic changes, that of taken place over the last 44 years. remember that before 1967, israel was all of 9 miles wide. half the width of the washington beltway. is one of the boundaries of peace. -- these were not the boundaries of peace. we cannot go back to those indefensible lines. we are going to have to have a long-term military presence along the jordan, and i discussed this with the president. we understand we have certain security requirements that will have to come into place with any deal that we make. the second is -- it echoes

something the president just said, and that is israel cannot negotiate with a palestinian government backed by hamas. hamas is a terrorist organization committed to israel's destruction. the fired thousands of rockets on our city, on our children. it recently fired at a yellow school bus, killing a 16-year- old boy. and hamas just attacked you, mr. president, and the united states, for ridding the world of bin laden. so israel can obviously not be asked to negotiate with a government backed by the palestinian version of al-qaeda. i think there is a simple choice. abbas has to decide whether he negotiates and pieces packed

with hamas or makes peace with israel. i hope he makes the right choice of using peace with israel. the palestinian refugee problem and have to be resolved in the context of a palestinian state, but certainly not in the borders of israel. the it attacks on israel in 1948 resulted in two refugee problems. palestinian refugees and jewish refugees of roughly the same number. the vast arab world refused to absorb the palestinian refugees. 63 years later, the palestinians come to us and they say to israel -- accept that you are the grandchildren and three great-grandchildren of these refugees, and thereby wiping out the future of israel as a great

jewish state. it is not going to happen. everybody knows is not a point to happen. i think it is time to tell the palestinians is not going to happen. it can be resolved. it will be resolved at the palestinians choose to do so. but it is not going to be resolved within the jewish state. the president and i discussed all these issues. i think we may have differences, but i think there is an overall direction that we wish to work together to pursue are real, genuine peace between israel and its palestinian neighbors. mr. president, you are the leader of a great people, the american people. i am the leader of a much smaller people.

>> a great people. >> it is a great people, too. we have been around for almost 4000 years. we've experienced struggle and suffering like no other people. we of undergone massacres and the murder of millions. but i can say even at the needier -- at the nadir, we never lost our dream of restoring the sovereign state of our ancient homeland, the land of israel. now and a time of extraordinary instability and uncertainty in the middle east, we want to work with you to fashion a piece -- peace that will ensure israel's security and not jeopardize its

survival. i take this responsibility with pride, but with great humility. because, as i told you in our conversation, we do not have a lot of margin for error. and mr. president, history will not give the jewish people another chance. so in the coming days and weeks and months, i intend to work with cuba -- work with you to seek a peace that will address our security concerns, seek a genuine recognition that me wish from our palestinian neighbors, and did a better future for israel and the entire region. and i thank you for the opportunity to do it. to exchange our views and to work together for this comment.

thank you, mr. president yuri >> thank you. >> [unintelligible] >> president obama will address the american-israel public affairs committee tomorrow. this is soon after his speech earlier this week and u.s. policy in the middle east and his meeting with israeli prime minister benjamin netanyahu at the white house. we will have live coverage of his remarks at about 10:30 eastern here on c-span. this past week, president obama gave the commencement address at a high-school in memphis, tenn., that won his race to the top education competition. he spoke about the initiative and how the schools innovations have helped increase the school's graduation rate in college enrollment. he urged congress to change the no child left behind law to allow greater flexibility for some schools to determine their curriculum. the president is followed by senator kay bailey hutchinson

with the republican address. she talks about increasing energy resources. >> this week, i went to memphis, tenn., where i spoke to the graduating class of booker t. washington high school. this commencement was especially hopeful because of just how much the kids at booker t. washington high school had overcome. this is a school and in the middle of a tough neighborhood. there's a lot of crime. there's a lot of poverty. and just a few years ago, only about half the students graduated from the school. just a handful went to college each year. folks came together to change all that. under the leadership of dynamic principal and devoted teachers, they started an academy for ninth graders, because they found that was when a lot of kids were lost. they made it possible for a lot of students to take vocational

courses or advanced placement classes. more importantly, they did not just change the curriculum. they provided a culture that creates hard work and discipline and they showed it every student can matter. today four out of five students at the school earn a diploma. 70% continue their education, many the first time in their family to go to college. so booker t. washington high school is no longer a story about what has gone wrong in education. it is a story about how we can get it right. need to encourage the story. we need to encourage reforms driven not by washington, but by principals, teachers, and parents. that is how we can make a difference from the top down and the bottom up. that is the guiding principle in the race to the top competition might administration started by years ago. the idea is simple. if states show they are serious about reform, we will show been

the money. -- we will show them the money. and in tennessee, they launched an innovative program where new teachers can be mentored by veteran educators. there are grants that support teachers that offered more specialized glasses and make the changes necessary to improve predictor improve struggling schools. our challenge is to allow all states to benefit. we need to promote results while encouraging communities to figure out what is best for their kids. that is why it is so important for congress to replace it no child left behind this year. reform just cannot wait. if anyone doubts this, they should head to booker t. washington high school. they should meet the children who worked so hard to earn their

diplomas. we need to give every child in america that chance. that is why education reform matters. thank you for listening and have a great weekend. >> hi. i am united states senator kay bailey hutchinson from texas. with energy prices soaring nationwide, american families are struggling to put gas in their cars and trucks. we have seen the price of food and other goods rise. an overwhelming majority of americans say gas prices are causing financial hardship for their families, and more than half say they of had to make major changes to their budgets and to compensate. unfortunately, rather than work to increase domestic energy production and bring down gas prices, the obama administration is seeking to impose more regulation and taxes on oil and gas companies.

this is keeping our own resources out of reach and harding at job creation. their proposals will increase pain at the pump. earlier this week, republicans put a modest bill to increase production on the floor and democrats could not even support that. with gas hovering at around $4 a gallon. republicans have consistently called for greater access to our domestic sources of energy to spur american jobs and to prepare for circumstances we cannot control like natural disasters or unrest in the middle east that creates instability and drives up the cost of a barrel of oil. we have vast resources under our land, and we need to safely explore and develop them to have a stable energy supply for our consumers and our economy.

for nearly a year, america's energy producers in the gulf of mexico, our nation's most abundant source of oil and gas outside of alaska, were sidelined by a drilling moratorium proposed by the administration. exploration slowed to alt. thousands of american workers found themselves out of the job. the moratorium was officially listed in october. the permit approval process has been burdened by bureaucratic impediments. in energy-rich deep waters and in the gulf, only 15 permits have been approved in the last full year. before the moratorium, an average of eight per mr. reviewed every month. a federal district judge recently judged that the federal government was improperly

delaying permit reviews. the federal government should be processing permits with urgency. instead, it is dragging its feet. in fact, production has decreased by 13% for next year because of permitting delays. the obama administration moratorium will have long effects on energy production. while companies are forced to stop operations, they had to continue paying to lease lands they were prohibited from using. leaseholders sat idle for a year, losing valuable exploration time through no fault of the rhone. earlier this year, i proposed the lease act, to restore time lost to all leaseholders impacted by the moratorium. it is as simple and fair way we can bring these energy producers the equity they deserve.

we can help them put their workers back on the job. the house has already passed its own version of this bill. i hope the senate will also pass it soon. our country needs a long-term policy that provides energy for our own ample natural resources. we can provide affordable energy families.tion's we call on him to put policies in place that cut the bureaucratic red tape and put americans to work doing it. a comprehensive energy policy cannot be given by gas prices or polling numbers. it requires a steady approach that will result in a stable supply of energy.

we have an abundance of oil and natural gas. now we need to access it. tapping our own vast resources will help lower energy costs for americans and at high-paying jobs to our economy and strengthen our security for future generations. >> next, we will take a look at oil and gas drilling legislation. first, a look president obama's schedule. he leaves sunday for a weeklong trip to europe that begins in ireland. we will have live coverage monday about noon eastern time on c-span2. then he will meet with queen elizabeth and prime minister david cameron. he ends his trip in poland before returning to washington on saturday. interior secretary ken salazar gave testimony at a senate

energy and natural resources committee hearing on natural gas drilling legislation. ed this is an hour and 15 men's. -- this is an hour and 15 minutes. >> mr. secretary, we welcome you back to the committee used to serve on your testimony is in the record. we welcome you summarizing this force. why don't you go ahead and introduce your colleagues, if you would like? we're familiar with some of them. we always like to have introductions. >> thank you very much.

it has always been an honor working with you and working with ranking member murkowski. spa to vote for giving us the opportunity to present before you today. joining me -- the deputy secretary of the interior, david hayes. is been working on oil and gas issues. to my left, mike bromwich, the director of energy management and legislation. he has been working very closely to move forward with oil and gas production in the oceans of america. we have been working hard for

over two years to work on developing a secure energy future for america. and we have been able to do this work with congress to move on in the right direction to get to the secure energy future. if you hear me or any of my colleagues on the cabinet speak to that, we are really talking about a secure energy future that is based on three buckets. the first is moving forward with a robust production of oil and gas resources. i think when you look back at the last two and a half years, you will see there has been a robust level of oil and gas production in our country. in fact, more oil and gas being produced now than in past times of our history, with record levels of natural gas. secondly, moving forward with alternative fuels, we recognize that oil and gas are not going to be the panacea