i've had the opportunity to work with him not only at the state capitol but at the "chief tain." he knows a lot about kohl and the water law that made kohl the great state it is today. not only will i miss tom, i know the people of the area will as well. i look forward to working with you because i know in the chair: the gentleman yields back the balance of his time. for what purpose does the gentleman from texas rise? mr. poe: request permission to address the house for one minute. the speaker pro tempore: without objection. mr. poe: veterans day is the day we honor veterans who go overseas and return. memorial day is the day we honor our soldiers, sailors and airmen who go overseas and don't return. monday is memorial day and all

americans should give honor, praise and prayers for those who served and gave up their lives for the rest of us. they gave their youth for our future. not far from where we are today, right down the malice the newest memorial, world war ii memorial. the greatest generation, veterans that served. on the back wall, looks like a bronzed plate and you know it is not bronze, but there are thousands of stars, 4,000 stars on the world war ii memorial. and each one of those represents a young american that went overseas in the great world war ii and did not return. 400,000 americans. those are just a few that have served and given their lives. patriotism is a good thing and this memorial, we praise those

that it serves and we praise the families of those who served. and it's just the way it is. i yield back. the speaker pro tempore: for what purpose does the gentleman from texas rise? >> permission to address the house for one minute. the speaker pro tempore: without objection. mr. brady: our postman is retiring this weekend. normally this wouldn't be national news. russell skinner has been serving our community and neighborhood for more than 30 years. more than that. he is an entrepreneur, has his own flooring company and see him on evenings and weekends working to provide not only good service to his customers but take care of his family as well. he runs a christian gospel singing group. you will see him in our local churches bringing god's songs and music across our region. russell skinner loves his country. he loves our soldiers. he loves his family and he loves

his god. and he's just part of the american dream, living it, working it, fighting it and russell skinner will be missed in our community. he's what's great about america. i yield back. the speaker pro tempore: the gentleman yields back the balance of his time. are there further requests for one-minute speeches? under the speaker's announced policy january 5, 2011, the gentleman from iowa is recognized for 60 minutes as the designee of the majority leader. mr. king: mr. speaker, it's my honor to address you here on the floor of the house of representatives in this great

deliberative body that we have and in the aftermath of this historic vote that has gone up on the patriot act and as we have debated this and worked with the amendment process and negotiations that took place in the senate, we got down to the last minutes here and i presume final passage of the patriot act is now on its way to the president's desk to be signed tonight. so there is not a window of vulnerability with regard to the intelligence we can gather against our enemies that are ever more coming into the united states and plotting against us globally. this is an issue that emerged when we saw our vulnerabilities after september 11. and as that was dealt with in this congress and pieces of legislation that have been passed in a relative emergency situation, patriot act among them, stands out as something that came to together with -- it

was clearly a bipartisan effort to put the patriot language together. and it was done so with the information we had at the time. some of that was gathered in a hasty fashion. and the patriot act was passed here in the occupies. it was passed with the idea that it had sunsets on it so it required authorization so congress could have oversight over the authority that was granted in the patriot act to do surveillance. for example, roving wiretaps, clear back in the 1980's, it was understood with cell phones when investigators were investigating organized crime, for example, the mob figured it out they could pick up a cell phone, dispose of it and use it for a while and dispose of it and that the old wiretap laws that would

allow a judge to grant a warrant to tap a landline, a residence or business of the suspected mobster were archaic in the 1980's and so congress acted and provided for the roving wiretaps for investigations domestically but didn't cover investigations that had to do with terrorists and noncitizens. and as i look at the components of the patriot act, it comes down to this, that the constitutional protections that are there for the individuals that are being investigated are equal to or greater than those protections for american citizens and domestic investigations unrelated to terrorism charges. roving wiretap is a piece that was a natural that had to be part of the patriot act, and it is and we have the fisa courts, special courts that evaluate the

investigations and yield the judgment as to whether they are in compliance. the national security letters, of which there have only been 300. yes, there is a confidentiality attached to that. if a federal agent goes into an entity and shoes a national security letter, that is reported to the court. and the company that is required to produce that information is bound by confidentiality for obvious reasons. if osama bin laden or czar cowy or any of the plotting terrorists were plotting against the united states, they would be tipped off. they would be tipped off on the letter, which means the investigation would be blown up by that lack of confidentiality. the lone wolf of piece. they stood up very well and one of the people that has stood up

on this issue and understands this very thoroughly and one of the people on the select committee of intelligence which will prevent her from talking about the deep intelligence that goes on in the secure room in this capitol is my friend from minnesota, michelle bachmann. mrs. bachmann: this is a very important issue and very important vote that we have just taken here in the house chamber, is dealing with the patriot act. and we have had calls and requests on our facebook, twitter and email urging a no-vote on the patriot act. i cast a yes vote. the patriot act did pass. this is why. this is an authorization for the next several years on three years. one is on the lone wolf exception. we have a new war, new enemy, new tactics. the lone wolf is one actor

acting alone and we have a tip and we have to go in and find that actor. that is an appropriate use of imagining this intelligence and information. roving wiretaps, we have changed from the days of telephones being wired into the walls, now we use a phone. modern terrorists will by 1,000 phones and make one fole and pick up another cell phone and make another call. we have to have the ability to be able to go to whichever phone a potential alleged terrorist may be using. the third exception is the business records exception, section 215. this is the section that people have the most worries about. they worry about infringe meant of fourth amendment rights. i spent all this week going from members month i felt would

oppose, people who were national voices who oppose the patriot act to find out what their concerns are. i'm a lawyer and i'm concerned about making sure we never cross the line as the federal government. why? because i think government is too big. we intervene too much in people's lives and don't want to give government the right to go in and access my personal private records. this is what i know to be true about section 215 and why i could vote for it. number one, no right of imagining access to records can be given unless a federal agent goes to a judge first. they have to go to the fisa court. also, there has to be a connection to national security interests or to a foreign government. we've got that level of protection.

when he they go and make these requests, then they can go and gain access to a record. now these are business records. these aren't records in my basement or your basement. these are records that a company has, like a phone company or a bank, but used in only the limited case where a judge first grants permission. so what does that mean? that means that it is constitutional in that the individual americans do process rights that are observed because a federal agent first has to go to a judge, a judge has to apply due process to that request and then from there, then access can be given to records, not in an individual's house, but from a business. and then during the course of an investigation, again remembering, as if there is a

threat of a national security threat only, then during the course of an investigation, it's understood, if we are investigating a terrorist, we get a lead that muhammad has a phone and get his information and able to access records that are connected to an alleged terrorist or now an admitted terrorist, we now have to be able to have the means. do we tip off like a muhammad that we are looking at these records? of course not. that would be absurd. because it is a different war and because we are observing fourth amendment rights. muhammad is not an american. he is not an american citizen. he is not an american, but for americans, when we are seeking a request for a record of an american, the federal agent first has to go and get this approved by a judge.

i urge people, mr. speaker. go to my facebook site. we have all the documents up to verify and show all of the reasoning behind the patriot act. and again, this is a very important discussion this evening. i want to thank my colleague, steve king, for bringing it to people's attention. i spent all week trying to get the basis whether the vote should be yes or whether it should be no. i have confidence this evening that it was the right vote to cast a yes vote and i encourage anyone interested to go to my facebook site and read for yourselves and make up your mind that in my opinion this passes constitutional muster. i would not vote for this bill unless i thought it did pass constitutional muster. and i yield back. mr. king: reclaiming my time and thanking the gentlelady from

minnesota to come to the floor and add clarity and having the courage to stand up on these constitutional principles, i had it pointed out to me that the fourth amendment of the constitution limits the patriot act. it's the protection against unreasonable search and seizure. and these searches and seizures that have been found to be reasonable across this land are very well settled law. very well settled law and the patriot act, this would end the parameters of existing domestic surveillance and i would add that this congress has protected itself in this fashion that the major components of this patriot act are extended for four years. this congress can come back and re-evaluate the patriot act and within this four-year period of time and require

re-authorizations and making sure that the abuses do not take place. one who has gone up to the secure room and gone through a number of secure briefings that had to do with the function of the patriot act, it is a requirement to do that. i made a pledge to a number of other members that i'll keep an eye on these constitutional functions and the respect for this statute that is given by the federal agents that are allowed to utilize the pailt act. and that will be a -- patriot act. and that is a never ending vigilance. one of the people who is dual vigilant when the rest of us take a little break and catch some sleep at night, back keeping his eye on the functions of government, one of the relentless and incease ant

providers of constitutional provisions and i yield to mr. gohmert of texas. mr. gohmert: as my friend knows, we have both been extremely vim lant in following up these issues. there's a lot of confusion, there are people on television just making these claims that constitution has been thrown away. an they haven't looked at how these three provisions that have been extended for four years were being used. now, my first year here, 2005, we were taking up the patriot act and i had concerns then, i still have concerns, because these things, these powers, have been held constitutional and i think they are.

the problem comes in the potential for abuse. and the reason that i ended up catching a lot of grief from some of the leaders in our party back in 2005 as a freshman was i wanted to have sunsets on some provisions so that we could get leverage because as we saw from attorney general gonzalez, when he was -- from attorney general gonzales, when he was head of the jus kit department and as we've seen with attorney general holder, departments of justice are not very forthcoming, no matter what party they are, when congress asks for information. they'll say, oh, yeah, we'll give you whatever you need. but they're not very forthcoming. it's not until powers they want to keep come up for sunset that they could go away and they need them renewed and they know they need them renewed because

they are helpful in keeping the country safe, but it's only then that they come forward and say, oh, by the way, what was it that you made into request a year ago that we never did provide you? and that basically happened back in 2004 and 2005. and that was one of the reasons i was pushing, we've got to have sunsets because the only way to deal with these issues and make sure the abuses are not occurring of these constitutional powers is to put sunsets and that way they come forward with the information and those of us who have the security clearances can go in. not everybody that has security clearances has enough interest to go wading through this material like my friend from iowa and i have, but i think part of the problem has been people have been confused with the abuses that occurred, the outrageous abuses that occurred, with the national security letter power which has

been reined in some, still not if you have for my liking. i really would like to rein the national security letter power in even further because it is not required to go before a district judge like these powers that we extended tonight for three years. that's where the abuses were. that's where the report said they were, so that's where a tremendous amount of vigilance needs to be placed in making sure that the justice department does adequate vigilance themselves in not abusing the power they have. and i'm sure i didn't make the director of the f.b.i. very happy, but when i pointed this out to him in committee, but it's what i believe. and that is that this director came into the f.b.i. and

eventually implemented what he called a five-year policy so if you were a supervisor in the f.b.i. of a field office anywhere in the country and you did five years in that location, at the end of five year, you had to move up to washington or get out of the f.b.i. move out, basically. we have lost thousands of years of experience from our f.b.i. now, i know what it is to be an aggressive prosecutor, young, out of law school, had a little more hair back then, and boy, we're going to get the bad guys. there's something to be said for experience. so it's not been uncommon to have f.b.i. field offices around the country go for example from having a supervisor with 25 years of experience, he or she has seen

it, done it, been there, and able to learn from mistakes, make wise decisions and yet buzz of the pive-year up or out policy, they end up having to leave because they're not moving to washington and when they do, we've had offices, for example, come in and the new supervisor has five or six years of experience. we go from 25, 26 years to five or six, not good for the f.b.i. these are fantastic agents, take nothing away from their knowledge and ability but there's something to be said for 25 years of experience as a law enforcement officer and we lost that. as we lost that, we began to see these vast abuses of the national security letters. and people need to know that the national security letter power was not up for renewable tonight. and it is something i would like to address further because

it has such tremendous potential for abuse and i'm hoping we can deal with that and i also further hope that those who are really upset or concerned will not just take demagogue statements but will actually look into this as i have and i've spent no telling how many hours poring through material, classified trl, poring through the laws, the interpretation of the laws, and these powers basically the same powers the f.b.i. has, these three that we renewed tonight, basically the same powers the f.b.i. has to go after organized crime and now they're allowed to do it with terrorism. they pertain to terrorists or agents, foreign agents of foreign powers, so if they're properly supervised as i know my friend from iowa and i will

do, unless we get kicked off the judiciary committee, but sloppings we're allowed to be there and as unpleasant as some people find our positions at times, we want to make sure there's adequate supervise and that's what i intend to do, that's what i know my friend from iowa intends to do, that's what our friend michelle balk map from minnesota will do, that's one of the most diligent -- bachmann from minnesota will do, that's one of the most diligent people i've seen. i'm not sure there's any other member of the house or senate that has a masters in law, and she has a masters in law. you have people who understand the law an study it an are looking into the allegations. i'm comfortable with what we did tonight only to the extent that i know that there will be an awful lot more nights like i've had the last two nights where i get an hour and a half

or two hours of sleep because there's so much to review, so much to cover, so much to read because of this important responsibility we've been handed. i hope people will understand national security letters have been the area where there's been great abuse, supposedly that's been reined in but the reason many -- not many, but some of us on the republican side demanded sunsets on these are not because we think they're unconstitutional but because we have got to have leverage in order to use what the justice department, no matter which party is in power in the white house, make sure that our freedoms are preserved and congress can use its power, have power, have leverage, and i appreciate my friend for yielding. mr. king: thank you.

it occurs to me as i do the discussion -- as i listen to the discussion here and participate in it there was a decided lack of enthusiasm for the patriot act from barack obama when he was a senator, and he was the most liberal voter in senate, to the left of behr nee sanders, who is an admitted socialist. he was to the left of his patriot act he sat down with his briefings which i presume an hope are daily briefings, he began to understand the threat to the united states that exists domestically and abroad, his position began to migrate and perhaps as we speak now he's picking up his pen to sign the patriot act that extensions of the three provisions that were approved here tonight that

extends them for a four-year period of time that, mr. speaker, brings us back before this congress and it means also that all of the people that are utilizing the patriot act within the sections 206 of roving wiretap and 215 the business records components of this and section 6001 a, the lone wolf component, each of which were extended by this congress for four years, all of the federal agents that will be utilizing these provisions will be very well aware that congress will be reviewing these provisions within four years of today. and so they'll be careful, i think, to comply with the law and i think this is a prudent extension rather than the effort to make it permanent, i think it's prudent to temporarily extend the provisions of the patriot act. as the gentleman from texas alluded to, and i would appreciate, i would like to reiterate and emphasize this

point, of all the things that we have heard and the things that we've heard up in the secure room from the classified standpoint to things we have heard before the judiciary committee and the many hearings we have had, the challenge that was put out toward president bush in a partisan effort, i think, to undermine the patriot act before the last presidential election in november of 2008, all of those efforts, not one individual was produced who had had their constitutional rights jew surps. not one. not one had lost the -- not one had lost their constitutional rights under the patriot act. it would seem to me that of all the encounters that have taken place under the patriot act for all these years, if there had been serious abuses of people's constitutional rights, we would have heard from an individual. and then a statement is made well, we won't know because we don't have access to these

records that they're all secret. well, the records are reported to the fisa court and the fisa court evaluates them and the reason we know those records exist is because there's a requirement of the court reporting. still, not an individual has come forward who has had their constitutional rights and civil rights abused. that doesn't mean -- i'm not taking the position here that it has not happened, and i'm not taking the position that it could not happen, my position is that if it had been endemic, if it had been something that was systematically grinding through the civil rights of americans, or individuals that are in the united states under the protection of our laws and constitution, we would know some of those names, we'd know some of the faces, we'd understand those incidents. one of the hardest things you can do in this business is to rye to explain something that is law without putting a face on it. to try to explain a flaw that they argue might exist within the patriot act without being

able to give an example or an anecdote to put that face on it so people can see by example how the things work. we're dealing with data here because we don't have the individual examples, they have not come forward or been identified, however mightily some have tried to produce them. so i support the expansions we passed here tonight. it's something i have worked with here in this congress into my ninth year. it's very much something we've examined, i think, very thoroughly with hearing after hearing and intense debate and amendments offered as well as the secure briefings that take us much deeper into the practices of the patriot act system of the three components that were extended here tonight for four year, roving wiretaps, which are absolutely necessary, if you can imagine khalid sheikh mohammed or moussaoui for example, running around the

united states with a gym bag full of disposable cell phones, using one for a little while, tossing it in the trash an then another and another and another, got to be able to switch and have a roving wiretap follow the individual rather than a single land line that might be there. it just makes simple sense. it existed for -- since the 1980's for domestic investigations of crime including organized crime, we have the business records components of this also extended for four years, that allows those business records to be accessed, to be able to look for patterns, patterns that would indicate the acts of planning of terrorism against the american people. . if the agent or attorney power is operating, they can do an investigation. a difficult investigation in the house and the senate. it came down to the last minute.

sometimes in congress we can only do things at the last minute. i would like to, mr. speaker, transition this subject matter and -- into another subject matter that i understand the gentleman from texas is prepared to discuss. the speaker pro tempore: the chair lays before the house the following enrolled bill. the clerk: senate 990 an act to provide for small business and small investment act. the speaker pro tempore: the gentleman may proceed. mr. king: in this brief explanation and i expect to yield so the gentleman from texas can take this up, in this translation and in this week, i think it's important that the house of representatives and the american people consider what

has happened wrrd to the middle east. and having come back through a trip and being briefed from you our national security issues, it comes to mind as i watch the president obama's speech last week about the global war on terror and about his efforts from a tactical and diplomatic effort in the middle east, naming country after country that have gone through the arab spring that we call it, unrest in egypt and the list goes on, certainly libya is part of this. as i read carefully through president obama's speech that i understand he delivered at the state department about a week ago or so, the speech, if you take iraq -- if you take israel

out of the speech, the rest, george w. bush delivering the bush doctrine and a lot of that mill os if i i support. if you give people an opportunity to grasp and achieve and succeed with the beginnings of freedom. they'll turn their focus from hatred and terrorism towards building their communities and towards commerce. that philosophy is beginning to emerge with a level of success in iraq, for example. it has been a belief of george w. bush and been known as bush doctrine. and president obama who has been critical in places like iraq and afghanistan. he gave a bush doctrine speech with the exception of jeal israel. there president obama, i'll's say broke the mold and went done down a new path, surprising

path, unless you are reading between his positions, to make the argument that there would be a two-state solution between israel and the palestinians that the palestinians would have a single country. right now it's either two pieces, west bank and gaza, and if you look at the map. it's not possible to tie together a contiguous palestinian state without severing israel from its components. and it was interesting also that president obama said, well, this is how we want to do it, the contiguous two-state solution and the issue of jerusalem, we will set that aside but have to go back to the 1967 borders and have caused people, those of us

who have a strong support for israel have a deep breath. why did he throw that confusion into the situation in israel and the statement that he made resulted in putting israel at even greater risk, undermining their security, making their negotiating position less stable and encouraging more pushback from the plain people and the terrorists that are part of the palestinians who refuse to acknowledge israel's right to exist. you cannot negotiate with people who are termed to get rid of you and benjamin netanyahu said they aren't going to concede the strategic locations that allow israel to defend itself. when prime minister netanyahu spoke behind where i spoke a couple of days ago, i think it was a historic speech. he laid out the parameters that

can allow the jewish state of israel to defend itself against enemies and there are many. and he went as far as he could without opening challenge the president of the united states. some happy with what has happened in the aftermath of president obama's speech that i believe areason usly that israel would have to go to the pre-1967 boundaries. i say to you and here before the american people, that speech took place here in the united states congress because of the activism and foresight of congressman gohmert who got us to sign the letter of invitation and took it to speaker boehner who i understand issued the invitation and the timing was impeccable timing and there are

critical issues taking place in the world. prime minister stepped here on the floor of the united states congress and spoke before a joint session of congress and joint session of congress that received him as a representative of israel with the warmest of welcomes that anyone could ask for but standing ovations, two or three of those before a word was uttered and before any substance was uttered, warm the but tacticically and montearl was demonstrated here in the joint session of congress and that's thanks to the gentleman from texas. as i wrap this up, i would thank you for your attention and your indulgence and i yield back the balance of my time. the speaker pro tempore: under the speaker's announced policy of january 5, 2011, the

gentleman from texas will control the remainder of the hour. mr. gohmert: i'm so grateful that i have such a dear friend from iowa as mr. steve king and -- well, there's no price you can put on a dear friend like that, thank you. i want to continue on the discussion about the president's speech. i'm not quite sure what the president had in mind when he decided to rush over to the state department and make a speech when he knew the prime minister of our dujail eye israel -- our due ally israel was coming to the united states.

he knew when he gave the speech, the prime minister would be at a great disadvantage. i understand it wasn't run by the prime minister, quite a surprise to him. and when there were hints that the president might make statements he did, there was a pleading not to do so. i don't know if those stories are actually how it occurred. no way to carry on national and international relations. it's certainly no way to treat our friends. it's not hard to understand that when it comes to international relations, if you treat your enemies better than you treat your friends, then your friends will desire to be your enemies. and you will get what you desire

. i don't know what people in the white house are thinking. this is a friend. you don't do this to friends. it jumps out and goes to the state department where he has a captive audience, i say captive, apparently from what's on the -- from statements that have been made, the president of the islamic society of north america, which is a listed co-conspirator in the wholly land trial for funding hamas, this co-con spiritor of funding in the holy land foundation had comments about the speech because he had been invited to be in the inner sanctum of our

state department by this administration. this administration, this president chose to make a speech basically slapping a friend in the face and at the same time invite the president of a listed co-con spirit ire for funding terrorism, to be in attendance so he could talk about how wonderful the speech what. this same imam, the president of the islamic society of north america that we find from readic reading the transcript of the speech in the number two person, the deputy national security advisor said this spring as he dressed the all dulles area

muslim society which they like to call adams for short, he thank the imam, the president of this listed co-con spiritor for his kind remarks and talked about how wonderful his prayer was at the white house iftar celebration last year, which is the celebration in islam that marks the end of the fasting of ra mad and. and in the marks -- in the remarks, the deputy national security adviser of the united states, noted that this was the continuation of the iftar celebration that thomas jefferson had. and indicating that the president is not getting good

information about -- we are not as the president said producing more oil than we ever have. you don't have to go back that far, we were producing 9.6 million gallons a ons the day. if somebody would be right enough to give the president the right information. he said we don't have more people on the border. show the history of 1916 when a haven't that i don't have a great deal of admiration for, woodrow wilson, knew it was wrong to have a mexican bandit led by pa nmp co villa coming to the united states and killing a handful of american citizens. that was enough to motivate the president at that time to call up something new called the national coward a to send

general per delnch shing and go into mexico and the murders stopped. the intrusions into the united states across our sovereign borders stopped. the 100,000-plus national guard troops that were placed on our border in 1916 made sure that the intrusions stopped. and by general pershing going in, they made sure that they weren't going to want to try that again. that's how you deal with domestic or foreign terrorism. we can't try to love people and you can love your enemies and christianity, we are taught to do that. and as individual christians, that's what we are supposed to do. but when we take an oath to defend this constitution, when we have the responsibility of an

oath to defend this nation, to provide for the common defense, then it is incumbent upon us to provide for the common defense and we have a different stand for which we have to answer. so, yes, christians are supposed to love one another. but the government's responsibility, as noted in romans 13, as the scripture tells someone attempted to do evil, if you do evil, be afraid because god doesn't give the sword in vein. we have the responsibility to provide for a free society and safe society where people will be free to love each other and make free choices. and yes, and yes, when there's a religion that's been hijacked

by radicals that says, you give people freedom of choice? that's wrong. we need to have a caliphate, we need to have a religious leader that tells everybody what they can do, that way we avoid all the debauchery that you can see on any evening news in america. the trouble is, god gave us freedom of choice. we can choose well, or we can choose poorly. and the government ought to ensure, any government ought to ensure that people have that opportunity to do that as well. so, after the president's speech, which basically amounted to a slap in the face over the leader of our friend israel, after the inaccurate representation by the white house that gee, this is where all the talks have always started, well, not exactly.

that was the point to which the clinton administration pushed prime minister barack when he was prime minister of israel and who knows, god knows, i think god hardened arafat's heart so that when the clinton administration that pushed the prime minister, what i think was far too far, which would have made israel indefensible by any conventional means, when arafat had basically everything he wanted, except the extinction of israel, rare fat's heart was hardeneded a -- and he said, no, i'm not entering the deal. thank goodness for israel. so israel remained a defensible nation. now, when the white house, when the president tried to walk back his comments and explain

and as someone besides me has said before, when you hear someone say, what i said was, it normally means that it isn't what they said, it's them trying to get a better twist than actually was the words that were said. but in the president's speech where he tried to massage the words that he had given on thursday, the president's word, and i've got a transcript of his speech here, he said, this is president obama, i said that the united states believes that negotiations should be -- should result in two states with permanent palestinian borders with israel, jordan and egypt and permanent israeli borders with palestine.

he goes on and says the palestinian people must have the right to reach their potential in a sovereign and contiguous state. so this is the president's speech after he has been chastised by so many in his own party and so many across america who apparently are better friends to israel than our president, he has had time to think about it, to pore over it and make sure he doesn't make a mistake of saying something this time that he doesn't mean. so we want to give the president the benefit of the doubt that he made mistakes in what he said thursday, let's look at what he said this past weekend and that should be what he really meant because he had time to massage the words he said. i think it's helpful to look at

a map of israel right now. it's under the control of -- the west bank is under the control of israel right now. this was israel's territory after 1967. israel was attacked, unprovoked, israel defended itself and took the sinai peninsula, took over the west bank, took over jerusalem, took over the go lan heights up here. and -- the go lan heights up here -- the golan heights up here and that was a defensible state. but israel and i didn't really understand it fully until i went to israel for the first time, i couldn't understand why do you guys not get it, that

when you unilaterally give away land trying to buy peace, you lose the land and you provide a staging area from which you are ultimately attacked again. but once i'd been in israel, an i saw locations of families, friends, being blown up by suicide bombers, saw the location of children and families that were killed, terrorized by rockets, now about 12,000 of them, i understood a little better. they are so tired of being terrorized and losing friends and family, they're willing to say, look, we'll give you this area up here in lebanon that we -- but -- that we were table

control after the 1967 war when you attacked us, we'll give it back to you if you just leave us alone. patrick henry said, people cry peace, peace, but there is no peace. israel wanted peace. so they give away northern israel, that's now colored as part of lebanon. and so it wasn't but a few years ago, lebanon starts attacking, comes across the border, takes hostages, attacks israel. from the very area which lebanon had been given in israel's unilateral quest for peace. now, during the times before they controlled the golan heights, this area is quite

high, overlooks the sea of galley, there's the jordan river, and it was real easy to just lob artillery shells from the golan heights into israel, terrorizing farmers, killing -- it was indefensible. so by the grace of god after they were attacked, they took the golan heights an they still hold them. and it is an area by holding they can avoid having cheap mortars that are a lot cheaper than rockets just being lobbed over into their settled areas, their civilized areas, killing and terrorizing all the more. the west bank, that goes off to prime minister -- to the prime min ter for the efforts he's made in trying to bring up the west bank, the palestinian areas. i was critical because he

received the -- the palestinians received billions of dollars, yet they had not been building homes for the rank and file refugees which seemed to indicate to me they wanted to keep fomenting hatred toward the jews, toward the israelis. now, let's take the president's words. that he had time to massage, learned from his mistake on thursday, supposedly. he says, that it should result in two states with permanent palestinian borders with israel, jordan, and egypt. well, you've got the gaza strip that israel unilaterally gave back and now they suffered thousands and thousands of rockets and terrorism and death as a result of that generous gift of the gaza strip back. if you'll just leave us alone, we'll give you this wonderful strip. they gave it back.

people cried peace, peace, but there was no peace. there is no peace now. they're still ready if you'll just leave us alone. to make peace. but under the president's words, gee, he uses the statement in a sovereign, contiguous state. palestinians have the gaza strip and they are occupying the west bank, for that to be contiguous, only one of two things that can happen and that is if you cut israel up, or you give all of this area to the palestinians that are now completely and -- in signed agreement with a terrorist group, hamas, you give all of this for the use of a terrorist group hamas, so then that would

fulfill the president's desire as he had time to massage it and think about it, giving all this land to hamas, palestinians, all of this area up here, well, wait a minute. he said that after he described the borders that we would demand for the palestinians, he said they would have a border with egypt and with jordan comes clear up here and that israel would have permanent israeli borders with palestine. he described the borders he wanted for the palestinians, so his massaged words it seems would mean that for israel to only have borders with the

palestinians, you also have to give palestine up here into lebanon so that you have this little area, this little strip left for israel. because that's what the president said. after he'd had days to think about his mistake on thursday and this is the best that he can do? we're going to give israel a little strip an by the way, can you imagine if canada or russia or china, one of the leaders made a speech and said, united states, by the way, we think you ought to give away arizona, you know, you've got drug smugglers up in there, it'll be a lot safer, basically let them have it anyway, why don't you just give it to the drug smugglers. can you imagine that?

that's what the interdiction of a meddling president trying to tell another sovereign state where they can have their borders and where they can't, that is not what you do to a fren. then we're winding down to the minutes, and i know that some people have been taught or miseducated about our history, but we're not going to be in session here on june 6. june 6 is the anniversary of d-day. when we lost thousands and thousands of americans who were trying to retake a beachhead in europe and eliminate the horrible force that was taking away freedoms, killing six million jews, and so to conclude tonight, mr. speaker, i want to read fre prayer,

since we're not going -- read the prayer, since we're not going to be in session on june 6, i want to read the prayer that franklin delano roosevelt read live on national radio on june 6, 1944. president roosevelt said these words, my fellow americans, last night when i spoke with you about the fall of rome, i knew at that moment that troops of the united states and our allies were crossing the channel in another and greater operation. it has come to pass with success thus far and so in this poignant hour i ask you to join with me in prayer. then roosevelt's prayer begins, almighty god, our sons, pride of our nation, this day have set upon a mighty endeavor, a struggle to preserve our republic, our religion, and our civilization and set free a suffering humanity. lead them straight and true. give them strength to their

arms, stoutness to their heart, steadfastness to their faith. they need thy blessings. the road will be long and hard for the enemy is strong. success may not come with rushing speed but we shall return again and again and we know that by the grace and the righteousness of our cause, our sons will triumph. they will not rest until victory is won. men's souls will be shaken with the violences of war for these men have lately drawn from the ways of peace. they fight not for the lust of conquest they fight to end conquest. they fight to liberate. they fight to let justice arise and tolerance and good will among all thy people. they yearn but for the end of battle for their return to the haven of home. some will never return, embrace these, father, and receive them.

your heroic servants into your kingdom. for us at home, fathers, mothers, children, wives, sisters, brothers of brave men overseas whose thoughts and prayers are ever with them, help us rededicate ourselves to renewed faith in thee in this hour of great sacrifice. many people urged that i call the nation into a sing dale of prayer but because the road is long and the desire is great i ask that our people devote themselves in a continuance of prayer as we rise to each new day and again when each day is spent. let words of prayer be on our lips invoking thy help to our efforts, give us strength to strengthen our daily tasks, to redouble the contributions we make in the physical and material support of our armed forces and let urs hearts be stout to wait out the long travail to bear sorrows that may come to impart our sorrows to our sons wherever they may and give us faith, faith in

thee, faith in our sons, faith in each other, faith in our united crusade. let not the keenness of our sprt ever be dulled. let the impacts of temporary events of but fleeting moment, let not these deter us in our unconquerable purpose. with thy blessing we shall prevail over the unholy forces of our enemy, help us to conquer the apostles of greed and racial arrogances, lead us to the saving of our country and with our sister nations into a world unity that will spell a sure peace a piece unvulnerable to the schemings of unworthy men and a peace that will let all of men live in free tom, reaping the just rewards of their honest toil, thmbings y will be done, almighty god, amen. the words of franklin d. roosevelt on d-day, june 6,

1944. and, mr. speaker, with that i yield back. the speaker pro tempore: the gentleman yields back.

the speaker pro tempore: for what purpose does the gentleman from texas seek recognition? mr. gohmert: mr. speaker, it is my honor to now move that we do now adjourn. the speaker pro tempore: the question is on the motion to adjourn. those in favor say aye. those opposed, no.

the ayes have it. the motion adopted. accordingly the house stands ad live coverage of the u.s. house when members return, always here

on c-span. >> journalism and freedom of expression are among the topics that he spoke today at the national press club. his remarks are next on c-span. the head of the federal deposit insurance company -- corp., testifies about the banking system. we will hear from the marine corps commandant on u.s. strategy in afghanistan. >> the c-span and video library of makes it easy to follow campaign in 2012. the peabody award winning c-span the video library is washington, your way. >> fox news commentator want williams talks about his

experiences as a journalist and commentator. mr. williams was fired from his job as an npr analyst after comments he made about muslims. he takes questions following his remarks. >> we are the world's leading professional organization for a journalist committed to our profession's future as well as trying to foster a free press worldwide. for more information, please visit our website. to donate to programs offered,

you can also visits the website. on behalf of our members worldwide, i would like to welcome our speaker. our head table includes guest of the speaker as well as a working journalist who are club members. if you hear applause, we do have members of the general public attending. it is not evidence of a lack of journalistic objectivity. i would also like to welcome our c-span and public radio audiences today. you can also follow the action on twitter. after our guest speech concludes, we will have questions and answers. it is time to introduce our head table. i would ask each of you to stand up briefly as your name is announced.

from your right, he is a free- lance pungent and comic. thank you for being here today. peggy is the congressional correspondent. she is tier of or freelance committee. -- she is the chair of our freelance committee. then comes my colleague from ap, michelle. she is president of the national association of hispanic journalist and member of the national press club as well. congratulations to rafael williams, the son of our guest speaker. we can allow one round of applause. [applause] and independent freelance journalist and she has formerly worked for npr. the devoted wife of our guest speaker today.

bob keep is the senior press secretary for the national resources defense council. bloomberg news, he is chair of our diversity committee. he and i worked together in buffalo, new york, many years ago. my colleague from ap broadcast, the new member of the national press club. she works for ap television news. steve taylor is a fox news correspondent. eric is media critic, moving over to the "washington post." a new member of the national press club. please give them a round of applause. [applause] we began with a quotation.

"yesterday, and npr fire to me for telling the truth here " that is how our guest speaker started a column in the wake of a disaster from npr. his departure from npr set off a firestorm. just a few months later, the president and ceo resigned under pressure. after his departure from npr, he explained that he did not fit in their box. nor did he fit into any box, which makes them all the more interesting. our guest speaker was born in panama, the son of a boxing trainer and a seamstress. when he was 4 years old, his family emigrated to brooklyn. he would go on to earn scholarships to an exclusive quaker prep school. it was at student newspapers

that he had his first taste of journalism. in a column after the npr dust up, described him as being cut from a different cloth. he started his career as an intern at the washington post." he spent 23 years as a reporter. he reported on everything from problems in the d.c. public schools to corruption by the mayor before going on to cover the white house and every political campaign. his insight and reporting act to amend it led to many television appearances. npr initially hired him to host "talk of the nation." later, he was the senior national correspondent and

political correspondent there. it led them to regular appearance on fox news. during an appearance on the show, he said this, "when i get on the plane, i see people who are in moslem guard, i think they are identifying themselves as muslims. i get worried. i get nervous. that his remarks was inconsistent. clearly, he has moved on from that. and he might be doing better than ever. along with daily journalism, he is the author of best-selling books. his next book is beefing up its recent experience. our guest has taken on expanded

roles on fox news. please give a warm national press club welcome to juan williams. [applause] >> it is a pleasure for me to be here at the national press club. i want to thank you all of you for coming out today. thank you for the invitation to be here. i have been in this room more than a dozen times to your speakers. i never thought i would be the speaker. never. of course, i never thought i would be in the situation that marked described to you just six months ago where i find myself

not having my byline or my column on the front page. it was me, the controversy was about me. i found my picture and my voice being replayed nationwide for being the journalist fired by npr, accused of bigotry. having said that i keep my comments between myself and my psychiatrist, and the suggestion being made that i should seek guidance from a publicist on what it is i say to anybody in public. if that was not enough to ruin a journalist stay, the official reason given for my firing was that i violated journalistic standards, something that all of you in this room will understand that i hold quite dear to heart. the idea was because i had made the statement that mark described to you, i could no longer be an effective journalist.

i was accused -- i was a black guy making fun of muslims for the entertainment of white racists. i was an unrepentant employee of fox news. there was quite a list of charges against me at the time. given that tarring of my reputation, i want to emphasize how much i appreciate the opportunity to be here today. especially to you members of the press. the suggested that i be invited to speak after the former npr president spoke here in march. the personal attacks -- it led journalist to add that i be given this platform today. i thank you. let me remind you that as smart described, when that person was

here, they refused to accept the platitude and the efforts to minimize the idea of the major news organization silencing a commentator. all this fits with the great tradition of this press club. debate that touches on the hard to and practice of journalism -- on the heart of journalism. this is a moment or journalism is in the midst of such a transformation. to help people make sense of the posturing, the provocateur orders that line today is a mixed media landscape. i also appreciate the chance to speak here because when i was fired, i was not given the chance to speak.

this is such a strange thing, but i was given a phone call and told that my contract was being terminated. this was after working for npr for 10 years. in essence, i had been muzzled, not been able to go in to explain myself, what the entire context that was prompting management to make the decision they made. in that context, i have to telling you that i feared that my career as a journalist was over. i feared that i had lost my credibility. npr certainly had a large microphone in every town in america. i did not know how this was going to play. to give back to my earlier point, i never thought i would find myself in this situation right i did not think i would have the opportunity to speak at

the national press club. with the ensuing congressional debate over npr funding, i found myself caught up in a whirl went great -- a whirlwind. i have worked in tv since the late 1980's. i have written a best-selling books. by comparison, the focus brought on by the recent controversy, i was fairly anonymous before all this happened. one man came up to me and said, i did not know what you looked like until i saw your picture on the front page of "the new york times." npr listeners used to say to me that it was nice to put a face with the voice. my instinct was to say, i did not know what you look like either. it was a surprise to me. now i have the situation with fox viewers that when they meet me they said, it is night -- it

is nice to be able to put a body to the face. that is a new twist. alice we are speaking here today, i wanted to ask you -- as we are speaking here today, i want you to engage in an act of imagination. i wanted to play around a little bit with imagination and have you a mountain that you are listening to a talk show. that our topic today is the firing of our guest. we will take your calls. we will have questions afterwards. let's begin with an update from juan williams. since my firing, i was hired full-time by fox news to be a political analyst. i appreciate fox making that

decision. i am also writing a column for the deal -- the hill newspaper. i have been writing this book. the book will come out in late july. that is an update on where i am now. let me change hats and pretend to be the radio talk-show host. i would say, tell us exactly how you think this storm started. winded the tornado ripped into your life? i guess my response would be, i did not even know that it had written into my life. what happened was that bill was on the open " the view" and expressed his belief

that muslims attacked us on 9/11, which prompted joy and whoppie to walk off the set. the following monday, i was the guest on his show. he passed me, where am i wrong? i said there was no way to get around the fact that there is a worldwide problem with a radical islamic thought. when i get on an airplane, and as the people were dressed in muslim garb, identifying themselves as a muslim, it makes me nervous. that was an expression of a feeling.

then i added to that we cannot jump to violate the rights of american muslims or any muslims from any place and the world because of religion. think about timothy mcveigh, think about the alleged bomber, -- olympic bomber, think about paid -- the westboro baptist church. we cannot violate the rights of people of any faith based on the actions of people who are extremists. i said all of this at the time in the full context of the interview that was taking place. i made it clear that we cannot tolerate people using rhetoric

and words to attack muslims because based on those fears, you could get into a situation where a cab driver had his coat -- had his throat cut because he was a muslim. that discussion was honest and heartfelt, and left npr to fire me. let me switch hats again. did i realize when you're making these comments that people might view them as inflammatory? i have to tell you that i never had that thought, not to this day. here we are may 26, 2011, about six months later, i never once had that thought. some days you catch yourself and a shower thinking, i should have said this. i have never had a second bought

because of what i expressed was a genuine feeling. it was not an analysis. it was not a suggestion that we based our psa policies on such a feeling. it was then on a statement a feeling. it strikes me that even in admitting to a feeling, how difficult it is in this country today to try to solve problems of racial, ethnic, religious discrimination if people are unable to speak frankly, if people are unable to start an honest dialogue. since to meet incredibly difficult. in fact, some people who wanted to criticize me said, he is

black. what if that had been said about three young black guys walking down the street late at night? somebody said, i did not feel comfortable because i saw these three young black men approached me. i said, i am black, if i was walking down the street late at night and i saw three young black men dressed in a thuggish manner, i would be nervous tissue. you are not allowed to say some things. what has been rewarding for me is that through all of this, there has been an incredible amount of support from left and from right, people saying that this is a time when political correctness needs to be called out. it is corrosive to public discourse and to public debate. i am reminded that george washington, one of the founding fathers, said, if men are to be

precluded from offering their sentiments on matters of central, which may involve the most serious and alarming consequences, the reason is no use to us as americans. he said this in 1783. i think it applies to this very day. let me switch hats again. what have you learned from this? first and foremost for me, i have been stunned by the number of people to come up to me, no matter where i am. basketball games, supermarkets, walking down the street, at airports. did at the same thoughts, and they feel like they cannot engage in honest discussion in this country. you cannot tell people what is on your mind for fear that someone is going to call you a bit.

you cannot tell people what is going on because there is a fear that he might be fired. given the fact that we as americans are going through so much change, it strikes me that we would try to silence debate at silence people were trying to contribute to a better understanding of who we are in service to the idea of solving problems and making it a better nation. what most surprised you during this?

right after i got that late afternoon phone call, i bit my tongue, i was so worried. i did not talk to anybody. it was npr about wheat this as a story. it started at the national attention. there was the worry that, i can see where people who are conservative might decide that they want to support me. they are most familiar with this idea that if he said the wrong thing, you might be subjected to the charge of bigotry, racism, etc. i wondered how the left movement -- that of the country might react. would this be an opportunity to jump on me? it was a big surprise to me when people like what people -- will be goldberg, sarah palin, agreed that what had taken place was

out of bounds. since this controversy broke, people everywhere say to me, i understand what it is to feel like you cannot speak in this country today. but tell me that they feel like there is too much political correctness and is being enforced by the political parties, and forced by lobbying groups, but advocacy groups, political correctness that is used to enforce identity in this country. it is used to raise money. it is used by advertisers. therefore, people in the middle -- most americans do not identify as conservative or liberal. they identified as people in the middle.

they have bought that very about different issues. to be in the middle is often to feel as if you have no voice. you are not allowed to express reservations, concerns, worry that you have misunderstood an issue or that you are being misunderstood. they worry that the people who do get to speak in this country are most often the provocateur taurus, the people who will say the most extreme things. they say the most out of line things and everybody pays attention. and then we go back to our politically correct speech coach in which so much goes on side. this inflexibility is a defining feature of our national discourse at this moment and

it's tragic. as the talk-show host, wendy's think this started? -- when the do you think this started? you go back to the 1960's and there was a lot of effort to try to change the way americans spoke as part of fighting barriers of inequality, racial and gender stereotypes back then. it was clearly of good intent that we want to try to eliminate bias in the way that we speak because that is evident in the way that we think. i think we have come to the moment of this inflexible debate. let me offer you some examples. i think that when the obama administration refuses to halt terrorism -- terrorists terrorists, i do not understand

it. think about -- a man he would make a documentary about the mistreatment of muslim women. no one wants to say that it was a terrorist act. think about a political cartoonist being in hiding to this day because she proposed to have a date in which political cartoonist lampooned mohammed. again, this is terrorism. the illustration is reluctant to call ed said. the president has the guts to go into pakistan to get osama bin laden, but avoid speaking frankly about the source of these talks. as a talk-show host, but me say, that is one example. do you have other examples?

it extends to current argument that we see in today's papers about budgets than entitlements -- a budget, impediments. the congressman from wisconsin was brave to put forward an idea. i might not agree with the specifics of its, but here was an idea put forward. every commission or grouped that has looked at this nation's budget agree that there has to be a mix of spending cuts and tax increases if we're serious about deficit reduction. but the other side is that the republicans will not allow discussion of tax increases or even elimination of subsidies. and then cite the iconic president ronald reagan for refusing to raise taxes even though a few check the record, president reagan raised taxes.

even when politicians try to break out of this pattern of republicans are allowed to say this and democrats are allowed to say this, they find that there are other people to hammer them into adopting the official line, the official line and message of the day. the result is, paralysis for us as a nation in terms of -- here is another example. taking on major issues like immigration. think back to president george w. bush, the chamber of commerce, senator mccain, all tried to take on this issue. what happened to them? they work absolutely muzzled by radio.vocateur os, talk

there were suggestions that we really did not have so much of a problem with the illegal immigrant as much as the possibility of terrorists crossing the border it was unbelievable. it shot down the real debate, the real discussion on a major issue in american life. as a result, nothing has been done on immigration issue. how do we get out of this box? date in and day out, as someone who covers american politics, i do not see an easy out. i see our political leaders modeling just this kind of muzzling behavior.

he called his opponent taliban dan. and ran misleading signs about his opponent. sharon ankle and nevada opposing the second amendment remedy. that kind of rhetoric is not only offensive, but suggested that your opponents are not worthy of being heard. they have to be shut down. wilson andmber joe yelling, you lied, at the president in the middle of an address on the joint session of congress. i think we all know about democrats in wisconsin plea in the state to avoid a vote. what about the senator recently

saying that 90% of what planned parenthood does in this country is abortion? when he was confronted with the facts, he said that he did not mean it as a fact. how do you have a discussion when you cannot express the facts? do we need to get back to the facts? it is that one possible way to get out of this? to that question, i would have to say, the facts are important. you can argue opinion, but not facts. it seems to me that there is more room for solution born of common ground down a provocateur o and some politicians would wat you to believe. americans are trust -- trust for

the people. i do not believe that we are big hits. i think we can have a sincere conversation. our greatest skepticism, our greatest goals should be for people to -- would -- for people who refuse to listen to discuss, people to refuse to entertain any abuse but their own. a willingness to engage in discussion and debate. when you hear about death panels and obama and muslims, it did just contributes to the polarized and distorted political reality that we live with today bread to often people are being rewarded with political victories and money for maintaining this dysfunctional status quo.

it was gabrielle giffords who said that a politician who tries to be reasonable, who tries to find ways to compromise, it is not rewarded in this environment. that is why i think that we see something that all of us hold so dear. niche journalism is being rewarded. so many people expressed a hundred and america for honest, frank discussion. i understand what you are talking about, tell me more. people who would not simply in voluntarily revert to a rigid orthodoxy, political correctness. that is why what happened to me became such a large issue.

it was never about me. it was always about our nation's ability to have debate and for people to feel as if we need are talking to each other, telling each other what we are feeling and what we're trying to express in service to the larger goal of solving problems and ending the politics of polarization. that is why as i am gathered here with you this afternoon, and we can stop this imaginary talk show, i would hope that all of u.s. practicing journalists, all of you to understand the importance of this profession to our democracy, would pick up this mantle of trying to get away from simply repeating one more time this is the official message coming from the left or right on x issue and perpetuating the idea that anybody who disagrees is not a

good conservative or a good liberal. therefore deserves to be shunned, silent, or fired. we have to be away from it. it is essential to our future as an american people. thank you very much. [applause] >> he is not going away. here comes the talk-show host. seven months since making those comments, you of not had a lot of second thoughts. what do not have done anything differently at all? >> no. i was asked when i got that

phone call, the suggestion was made, do you have any remorse? that is generally what i feel. it was not that i offered some analysis that was embracing the idea that people should feel this way or act this way. i was simply telling you how i felt. that was not meant to be provocative, it was not trying to stir an audience. it was in service to a larger conversation. i understand where you are coming from when you say, i associate muslim and terrorism in this society. building on that as part of a logical progression to achieve some understanding between two points of view. i never had a second thought about that. >> someone said not one of the muslims that you mentioned were

dressed as muslims. with respect to your comment, does that hold up if you reflect on that alone? >> it was not the specific of the dress. it is not the case. i would not know. even if i did know, the question would be, would i leaped to that feeling? that reaction? when i saw someone dressed in that way, it triggered a response and me. if you read the papers every few weeks, you will come across a story about a situation more people are praying before a flight or engaging in what some people might regard as suspicious behavior, and those

people have that reaction. i do not think it is exactly a strange feeling. i do not. >> any thoughts that might be different as a result of what has happened with the arab sprang? -- spring. >> i do not see how those two would relate. the focus in my mind, all of us who lived through 9/11, and subsequent terror alerts and concerns and attacks in spain and indonesia and the rest, i think that is the context in which -- that prompted this feeling for my mind of seeing a pattern. >> it is an interesting intersection.

about what is going on in the media and the ability to express one's feelings. let's draw that out a little bit about what is appropriate on air and what contributes to a civil debate. you are going on the air and you are in a wonderful position. you are paid to express your opinion. how did you decide what to filter when you are on the air? >> this is an interesting question for me because i worked at fox news before i was hired by npr. i was working at the washington post when i was first hired by cnn and fox.

would you have said that on npr? >> and i said, of course. it is the way i feel. i do not change from one set of opinions to another based on the audience that i am addressing. i think that is part of the value of -- that was acknowledged by npr and fox in both hiring me to perform functions for their audiences. he is speaking his trip. there is a clear -- his truth. i was paid in both roles as a political commentator. i was asked to express opinions, feelings, to try to bring people the larger picture to give them an understanding of how political events and ideas are being driven in this

society. i think that there is a line. if you are paid to hold the story in a straightforward manner, that is what you should do. i do not think total objectivity is always possible, but we can strive for that goal. if you are paid to be a political analyst and commentator, i think if you start playing games like that, the audience realizes that you are not authentic. you know what is going on, but you are not saying it. you are saying it in such a way as to speak to one audience that wants to have its pre-existing views confirmed. they're turning in for that. that is not just who i am. i think that is why i strive for a higher level of trust with the audience. i trust you to tell me you were -- your truth.

that is a very high goals for all journalists. >> did just so happens that the npr -- she had written in her blog. williams tends to speak one way on npr and another on fox. what do you think about that? >> not true. she is wrong. trying to understand her and trying to understand why -- what she might be talking about -- to the knowledge that he might be anxious about that evidence of racism? i do not think so. there are different formats. cable has a much higher value put on time, much more of a debate format, much more

confrontation. you are on camera, so the way that you looked has value. on radio, typically, my role was as a veteran washington journalists, someone worked for so long -- knows people, has good sources. i was being asked specific questions by a host. when the formal interview type format would break down, it was pretty much back and forth. sometimes pointedly, sometimes humorously. that was less frequent on npr ban on fox. these are different formats. that is to be separated from content. it was never the case that the content that i was delivering in one formats would vary

depending on the audience. i just do not play that game. >> not that that ever happened. we talked about ellen weisee. she was let go before vivian. were those dismissals warranted? >> it is not my call to make. clearly, i felt mistreated and traumatized. i do not think it was a service to the institution of npr. which i value greatly. npr is an important journalistic institution. when you are engaged in a kind of practice that would silence people, or punish people, for speaking, i do not think that is healthy.

again, what you have to do is make sure you are being fair with your employees and the audience. it is not about catering to anyone slice of the audience. we are going to tell people what they want to hear, not introduce different points of view or different stories. i did not think that she was serving the institution very well. i think it opened up a lot of discussion that was debilitating to what was an outstanding brand. >> this is a chicken and an egg question. it is clear that the political debate has become much more

negative. it just so happens that it is reflected in a radio talk shows, on cable tv, in a way that was not present on cnn. now there is more time devoted to argument. do you see cable as setting a tone for the political debate in our country? is it merely reflecting it? what is the appropriate role for those media? >> i want to remind you that i was a substitute host on " crossfire" on cnn. it was the progenitor of many of those shows. i am not sure that i would agree with the premise. the idea of vigorous debate should not be limited to the extremes. sometimes i used to think that

the producers -- we are having a discussion about race in america tonight. what kind of discussion is that? it would get big ratings. there would be a lot of nasty words cent. but i do not think it would be eliminating -- illuminating. i think it is important to have debates, to your contrasting point of view. i really do put a high premium on having reasonable people engaged in the debate and people do have some sense of respect and trust for each other as opposed to people who delight in finger-pointing. >> as a liberal, held the rationalize going to work for

one of the most conservative in networks? it seems fairly obvious that the conservative pundits exploit you. do they not? >> after i was fired, the washington post wrote that i was the most conservative voice on npr. that was a surprise to me. maybe so. it just tells you that everything is relative in this world. i might to been the most conservative voice on npr, the most liberal voice on fox. this question about being exploited by fox would suggest that it might be better if i was not willing to engage in debate with people who do advertise themselves as conservatives. i think, again, that is an important fact in terms of saying, here is a different point of view. no one is telling me what to say. i am allowed to challenge the

debate. i get the worst lighting and the worst seat. but the debate is there for all to see. that is one of the benefits. you can hear the debate, you can hear both sides. the idea but i am a foil for some of the leading personalities, that is before matched. people tune in and to prime time personality-driven programs. people are looking for that strong up irritated a voice. that is -- authoritatively voice. for someone to come in and challenge the host, that is a thoroughly legitimate. that is not a matter of being exploited.

i think it is evidence of a legitimate debate for all americans. i think that is what we should be seeking out. >> you were talking earlier about the funding debate for public broadcasting. you have said that you no longer -- the funding should be cut off by the congress. can you explain that? >> it is not born of any type of vindictive streak. that is not my character. in the midst of all of this, you'll recall that there was a tape, it was secretly recorded treat -- recorded. we would prefer not to have government funding. that is apparently their genuine funding, but it is not expressed

publicly. if wheat -- is a very small percentage of overall npr funding coming from the government. it might impact some small markets, some stations might have to shut down. you would see a lot of stations join hands. you would see more consolidation of markets. it would not result and anybody losing access to national public radio. but the point that i feel the most strongly it is this. i think journalists should not have to look over their shoulder as to whether or not politicians think that they are doing a good job. if you look at the debate that was taking place at the time over npr funding, there were fundraising letters being sent by democrats saying, republicans want to cut funding because they

feel and be our response to rush limbaugh. when democrats did not feel that npr is doing the job, democrats are going to challenge? this is a bad game for anybody who wants to do journalism. lucky politicians played their games and the beat journalism -- what the politicians played their game, and let the journalists to do their job. >> hall arts -- how are news organizations doing on diversity? >> i did not come prepared for that. diversity it would wind and is doing great. there are more and more women in the workplace. i see more women and personalities. until recently, you had katie and diane sawyer. young women are without a doubt far outperforming young men.

we see college and universities stilbite young women -- filled with young women. they are moving up in terms of leadership when it comes to racial diversity, i find myself sometimes shaking my head because the racial diversity and has not improved even as you look at the demographics of the country and say, "there are more people of color now." more young people of color than indicated if you look at the population under 32 now approaching 40%. it seems like there would have been a breakthrough by this time

in terms of racial minorities in highly competitive media jobs. with the cutbacks we have been seen in the newspapers that have also impacted tv and radio, it has not acted in a beneficial way for racial diversity in american communities. >> is it true donald trott sent you a note after signing on to a trump website. if so, what were you thinking? the you think his comments targeting president obama were racist? >> that is the wildest fabrication i have heard. [laughter] >> you said earlier this month that ron paul could win the gop

nomination. why do you believe that out will the gop ticket fare in the general election? >> i did not say he could win, i said we were living in the age of ron paul. the is the father of the tea party movement in this country. his son is now in the senate. you think about the debate we are having over entitlement, the federal reserve, and the role government plays in reviving our ailing economy -- ron paul is at the forefront of many of these conversations. it seems to me more and more that we are living in the age of ron paul. i was a panelist for the debate in north carolina. he was talking about legalizing marijuana, cocaine, and heroin and receiving applause from the conservative north carolina audience. he said we have been in

afghanistan to long. yet ron paul and gary johnson, the former of new mexico, but saying this. that is not the party line. this is very different. i thought gary johnson was more -- with their more as a function of ron paul. many people do not know ron paul, but he was able to raise a tremendous amount of money. ron paul is a power player in a way that, i think, oftentimes those below the screen. people do not pick it up in terms of his true power. i do not know he would have much success as a presidential candidate. i would be surprised if he won the nomination. >> thank you. it or asking the last question, a couple of routine housekeeping matters. i would like to remind you about upcoming speakers.

agricultural work secretary tom vilsack will be here on june 13. on june 14, the former national security council adviser under president ford will speak at our annual gerald ford journalism awards. june 30, gary sinise. he will announce an organization for charity supporting the military. on july 11, we host the 14th annual race. secondly, i'd like to present our guest with the traditional npc coffee mug. >> thank you. [applause] >> now, i ask the last question. you worked as a newspaperman. you have been on the radio and now television. i assume you are better paid

than you were before, but if it was not about the pay, which of the platforms would be your favorite? >> actually, bob and i were talking about this. if you wake me in the middle of the night, i still think of myself as a newspaper guy because i came up is a newspaper writer. i must tell you, though, that people generally do not read my lines -- bylines. on tv they see you, but they see you more than they hear you. they have been emotional response to you and who you are. they will offer comments on your tie and all the rest. [laughter] on the radio, it is such an intimate medium -- people would write me letters and say, "you are the other adult in the room when i am taking the kids to school in the morning."

i was like, wow. then there was in the pictures of myself. the pictures were sketches, not actual pictures. people would suggest, "here is what i think you look like." in some pictures i would have degette. it was a thoughtful character of a npr talk show host. i was white, hispanic -- it was really a function of people's imagination. i will say that tv really spreads you out. more people hear you. it is the media of our time. that is where the american public gets most of their information, i think. but for in-depth reporting, there is nothing deadbeat's a

great newspaper. >> how about a round of applause for our guest speaker today? [applause] thank you for coming today. we would like to thank the national press club staff including the library and broadcast center. with that, we are adjourned. thank you. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]

>> up next, the head of the federal department of insurance corporation, she of bear, testifies about financial regulations in the banking -- sheila bair, testifies about financial regulations in the bank -- in the banking industry.

>> on tomorrow's washington journal, we will discuss the u.s. supreme court decision requiring california to reduce its prison population. kara gotsch joins us. then republican senator john grasso will talk about the house gop proposal to make changes to medicare. after that, historian and author douglas brinkley joins us for a segment about the world war ii memorial. "washington journal close-" each morning at 7:00 p.m. eastern. a member of the palestinian council will discuss the recent unrest in the arab world and what it means to the middle east peace process. that is a live from the carnegie endowment for international peace at 12:30 eastern. >> there are three days of booktv programming this holiday weekend. new releases with jim lehrer,

panels on feminism, and favorite books of 2011. michael more on his upcoming memoir. josh margolin on one of the largest federal sting operations in u.s. history. afterwards, the untold story of barack obama's mother. by the complete schedule at booktv.org. >> the head of the federal deposit insurance corp., sheila bair, is urging congress to increase the debt ceiling. she will set down for the fdic in july when her term ends. this house financial oversight subcommittee hearing is two hours.

>> today we are joined by the fdic corp. chairman, sheila bair. i would like to thank the chairman for more dedicated service. when thank you can say, it has not been a dull five years for you. you have had a lot of activity

and i thank you for your service to our country. i hope this will provide a forum for our members to understand the fdic in the financial crisis. the current state of fdic insured banks in general -- the recent passage of dodd frank enhances the role of the fdic. they are charged with unwinding failed financial institutions, providing a liquidation of artie. i am interested to hear about the fdic's ability to balance their new powers with the traditional role of financial regulator. an unfortunate effect of the financial crisis has been an increase in bank failures. the rate has increased dramatically in the last few years which won a good 40 failing in 2009, when added 57 -- 157 in 2010.

the fdic requires banks to prepaid premiums for the years 2010 through 2012. the deposit and insurance fund has significant challenges. i look forward to hearing from chairman bair about this. although i understand the need to replenish the fund, i think this could have an instant -- unintended consequence of not having enough funds for lending. we need to find a balance and to ensure we have a safe and sound deposit fund with -- without ceasing lending. i am interested in hearing what the agencies are doing.

we need to ensure that new regulations provide enough flexibility for small institutions to meet the needs of their customers and not be encumbered by a one-size-fits- all regulation geared to the largest institutions in our nation. a diverse financial institution is good for all market participants. i am interested to hear how the fdic will work with the consumer protection bureau. finally, i would like to touch on the liquidation of authority granted to the fdic by the dog- franc act. i know the chairman sincerely believes that these powers -- that these institutions are too big to fail. but i would prefer to see a different form of resolution where there is no taxpayer exposure. let's work together to make sure the mark -- the message is clear to market participants -- there will be no more government

bailouts. i would like to introduce the gentle lady from new york. >> i just want to join you, madam chair, in welcoming our outstanding chairwoman. i noticed -- note that this is her last appearance before our committee and i wanted to express my deep appreciation to our service, especially during the most recent financial crisis and your attention to communities, to details, to members of congress. i truly believe you had done an outstanding job. thank you. the fdic was forced to take a significant measure during the crisis and continues to act in the wake of the crisis to ensure the health of our banking system. your involvement and leadership was critical during this difficult time. we can now say that we are recovering from a crisis, not a depression. i think you played a meaningful

and significant role in our being able to say that. this hearing is very timely because it is happening during your last few weeks i in your tenure at the fdic, but also because it is happening during a period of recovery when we had the benefit of hindsight. during this most recent crisis, we sought 8.5 million jobs lost and over $15 trillion in household wealth mosque in america. although we are trending up in terms of job creation, it is lower than any of us would like. this crisis highlighted how important it is to have a sound financial system in terms of the functioning of our overall economy. we know the fear that can set in on main street and institutions of wall street are challenged and, in some cases, fail.

over leverage, overcapitalized financial institutions to contribute to the problem. structured finance products that were unregulated ran rampant, and you, the regulators, it did not have the tools you need to bring this in. congress change that with the enactment of dodd-frank this year. it gives the institutions the authority to wind down failing institutions and more power to regulate institutions. we made significant changes that directly affect fdic insured institutions. for example, we may be $250,000 deposit insurance limit permanent. you played a meaningful role in making that happen. we changed the formula for deposit insurance assessment so larger institutions engaged in riskier activities will pay more

than smaller institutions that pose less of a potential threat to the fdic. we increased the minimum level required in the d.i.f. to provide a better cushion in troubled economic times so smaller banks are protected from having to foot the bill that there is a need to raise additional funds. all these actions we took were meant to help both prevent another economic crisis and to help soften the blow when unanticipated things happen. i am looking forward to hearing from chairwoman bair because i know there are a number of new requirements on regulators. what do you see as challenges going forward? i want to hear any words of wisdom you have to leave with us before you leave your position. i just want to underscore, again, how much i appreciate

your service. i am looking for to the next chapter. i know you'll continue to make meaningful contributions to our country. thank you for your leadership and your service. >> i would like to recognize mr. royce or 1.5 minutes for an opening statement. >> thank you, madame chair. i would like to welcome you and thank you for your years of service. i have enjoyed our conversations. as you know, i am is still concerned that dodd-frank has not ended too big to fail, but has left us with a number of massive institutions that will continue to expand at the expense of their creditors because they're baring costs or lower. there is a 70% advantage according to studies you have done. at the end of the day, it is a

system that enables the use of government funds in resolving an institution and it relies on the prudence of regulators during a crisis to avoid overpayment to creditors and counterparties. i think the fact we get the lower cost of capital shows it is human nature that we have created a moral hazard in the equation. while i hope this committee works to eliminate the orderly liquidation of party and move to a more objective, and hast bankruptcy, i believe we can take steps in the near term to minimize some of the unintended and some intended consequences of this legislation. i appreciate your efforts and pause today, especially on this particular team. thank you very much. >> i would like to recognize mr. lew meyer for 1.5 minutes for an

opening statement. >> years ago when i was a bank examiner, we worked with institutions to make sure they understood the regulations to which they are subjected. instead of a partnership, i hear time and time again that relationships between financial institutions and regulators are more like a game of gotcha. i have heard stories of overzealous examiners. one bank was put on the problem list. it was noted to me that the examiner had been scolded the previous day for not doing a good enough job for predicting another bank be put on the list. that bank, since then, has had no problems. we need regulators to do their

job to promote sound financial practices -- no more, no less. we do not need overzealous examiners to have no regard for upper management and refuse to recognize what is going on in the field or the economy. i urge the fdic to take a look at the examiner staff to work with institutions so we to work to get our economy moving again. i look forward to the discussion. i yield back. >> i would like to recognize the gentleman from texas for one minute for the purpose of an opening statement. >> thank you, madame chair, for holding this meeting. hearingis that today's addresses a very important question -- did the dodd-frank at institutionalize too big to fail or did it level the playing

field as some politicians and regulators have argued? i am concern that recent developments, including market data showing marketing costs, are currently march -- much lower at big banks, and the continuing questions concerning the fdic's new authority to lead us to believe that too big to fail is still very much alive and taxpayers could be asked to bail them out in the future. i look forward to hearing from chairwoman bair on this important an ongoing issue. thank you. >> i would like to recognize our newest member, mr. kantor from tennessee, for one minute for the purpose of an opening statement. -- mr. fincher from tennessee, for one minute for the purpose of an opening statement. >> as the newest member of the

financial services committee, we are pleased to have the opportunity to deal with, hopefully, what will be the things that are going to fix the problems in the future. i was not in congress in 2008 when the financial crisis and war across the committees of our district. as a small-business owner, i felt it's a fax first hand as the bottom dropped out of our economy. one major principle i did take away from those days was the asset to credit is of vital in helping our small businesses of gen. until our financial institutions are allowed to responsibly do their jobs again and own money to qualified borrowers, we are not going to seek business is creating new jobs. again, thank you for your service. i look forward to hearing what you have to say today, but too many times washington is not the answer, it is the problem. i yield back. >> i would like to recognize the

gentleman from georgia for two minutes. >> thank you, mrs. chairman. i think this is a very important hearing. before i begin my questions or continue the comment, i would like to fill out some numbers for chairman bair. 63 is the number of banks that have failed in georgia since 2008. 12 -- the number of bank failures in georgia since 2011. 10 -- the number of banks headquartered in my district that have failed since 2008, including this past friday. this number is much larger if you factor the banks that only have branches in the district. these numbers or unacceptable. therefore, i will be introducing a bill directing the inspector general to inspect fdic long share agreements, the lack of an ability to modify or work out

loans, and the application of the fdic policy by examiners in the field. this study is not only vital forces -- for surviving banks, but said the fdic can learn from the problems. it is my hope the fdic and my colleagues will support this bill so we can have an honest assessment of the fdic's handling of this bank crisis. georgia is in a vicious cycle right now, going the wrong way. i have borrowed a lot of money from banks in my business career and i know there will be more failures in georgia this year, but i am here to say that when a georgia bank fails, my office will be searching for answers and holding the appropriate regulators accountable. with that, i yield back. >> that concludes our opening statements.

i would like to now introduce bair.sses. sheila thank you for coming today. >> chairman capito, thank you for the opportunity to testify today on the state of the banking industry and the federal deposit insurance corporation, and on future challenges to economic and financial stability. much has been written and said about the events associated with the recent financial crisis and the factors that led up to it. my written testimony summarizes four factors are considered the most important excessive reliance on debt financing, incentives and finance, regulatory arbitrage, and an inadequate resolutions framework that allows some companies to become too big to fail. the fdic was created in response to the most serious financial

crisis by american history in 1933. our mission then and now is to promote financial stability through bank supervision, deposit insurance, and the orderly resolution of failed banking institutions. shortly after taking the oath as fdic chairman almost five years ago, i came to realize that we would face significant challenges in a number of areas. although the fdic was still in the midst of a two-and-a-half year period without a failed institution, the longest such period in our history, there were signs that not all was well with the banking industry. predatory lending practices and unsuitable mortgage products, which were already an area of focus for me at the treasury department when i served as assistant secretary for financial institutions in 2001 and 2002, became even more prevalent as the decade progressed. rising concentration in the banking industry was leading to the emergence of large, complex organizations that encompassed bank subsidiaries, special- purpose vehicles, and nonbank affiliates, while a greater share of financial activity was migrating to nonbank financial companies. i am proud of all the fdic has accomplished in the past five years. my greatest satisfaction lies in the knowledge that we get pace with the depositors we were established to protect. we have maintained a 78 year record of no losses without borrowing a penny from taxpayers. we still have important work to do. our first task must be to follow through on the reforms that will

and too big to fail. at the height of the crisis, we lacked the necessary tools to resolve companies in a water leak matter and had to authorize government bailouts. too big to fail represents state capitalism. unless reversed, the result is likely to be more concentration and complexity at the expense of the public. the dodd-frank act as the cycle of government bailouts under too big to fail. they will be resolvable only at the regulators can exercise their authorities under the law. the success of this framework will depend on the ability to collect information and to determine whether they are resolvable under bankruptcy.

it will also require the willingness of the fdic and the federal reserve board to use their ability to require structural changes. a less organizations are rationalized and simplified in advance, there is a danger there complexity could make resolutions more costly and difficult than they need to be. these authorities are being shaped now and agencies will make them process. it properly implemented, they can make our financial system more stable. if we fail to follow through on these measures when market conditions are relatively calm, we will not be able to prevent bailouts in the next crisis. my testimony looks at the role for bank and non-bank financial companies. strong capital standards are of fundamental importance in maintaining a banking system that supports economic growth.

supervise the processes will always a lot of innovation to some extent and restrictions on some activities can be difficult to define and enforce. capital standards, all the other hand, are easier for supervisors to enforce and provide an additional cushion. skeptics argue that requiring banks to hold more capital will raise the cost of credit and impair economic performance. the crisis shows that the social costs are extremely high and that the lack of an act -- and adequate capital cushion makes the crisis reciprocal. loans and leases held by fdic insured institutions of loans have declined by nearly $750 billion from peak levels while and used loan commitments have declined by $2.50 trillion. trade and more were lost.

i would also like to highlight the urgent need for progress and the administration to address the rapid growth in debt. financial stability critically depends on public, and that's which should never be taken for granted. there is no greater threat to our future economic security and financial stability than an inability to control the size of the u.s. government debt. i feel just as strongly that a technical default on government obligations could be calamitous. any signal policy makers may not make good on these obligations will destroy the trust that investors have placed in our nation for more than two centuries. i urge congress to commit to the irresponsible increase in the debt ceiling. i would like to share with you one lesson i have drawn from my experience as fdic chairman. it is the most important attribute of effective legislation is the courage to

stand firm in the good times. it is during a period of prosperity that the seeds of crisis or sound. overwhelming pressure is placed on regulators to relax -- relaxed capital standards and to allow higher concentrations. the history of the crisis shows many examples when they failed to use of parties they already have or fail to ask for the authorities they need to fulfill their mission. many in the regulatory community -- regulators are never going to be popular or glamorous with the they act in a timely manner or failed to act and allow it to take place. the best they can hope to achieve is the knowledge of the exercise statutory authority and act in good faith in the interest of financial stability in the broader economy crosses very much.

i will be happy to answer your questions. >> thank you. we will now begin a portion of the hearing for questioning. i will begin my five minutes of questioning. we have had ongoing discussions with you and your staff concerning the relationship of the fdic and the cfpb. the fdic just announced a new consumer division within the corporation. how will that work in relation to the cfpb? do you envision a consumer protection within the fdic that takes the regulations that come from the cfpb and modify them for the other institutions? what kind of -- are we creating a two-tier system here? >> i think under the statute the

supervision enforcement remains with the primary banking regulators. the institutions will stay with us in terms of the examination. we have never had authority for the consumer role. >we had never had the ability to write the rules. the fed rice the rules. we have coordinated with them. i think the cfpb director will be on the fdic board. that will help assure coordination. i am i hope that this will help increase the understanding about broader regulatory issues.

in terms of creating a new division, i want to emphasize the examination staff reported structures in the region that this was an organizational change. there was additional administrative staff to support the organization that -- or his racial separation. it -- organizational separation. the focus is far more effective consumer regulation. i have concerns about community banks -- banks that i had expressed. there is more focused they should be on violations. reporting violations or what have you. we have tried to refocus the examination force.

i think that has been a good outcome of the policy level focus of the fdic on consumers. i think this will be a way for us to have a better focus on consumer protection. coordinating with the new consumer agency will have an advantage. >> i want to go to another question quickly. it sounds like the structure is being enacted while these institutions are under $10 billion or exempted. it sounds as if they are not going to be exempted, which is there fear -- not their fear, fear of the unknown. it would be coordinated through your institution. >> with regards to examination reports, it does not really exemptions. it is what we have always done.

the primary banking regulator will buy sure they comply with consumer rules. the consumer agency has rules for all institutions. whatever rules state right, they will apply to all institutions. i have spoken in favor of a future regulatory structures of taking certain areas that are appropriate i think we will be able to engage with the consumer agency. that person will be on our board as well. >> over the last several years there has been increasing consolidation of the banking industry. we talked about the advantages larger institutions have with -- that smaller banks. smaller banks are concerned about being able to staff the regulatory issues, the legal issues they see in front of them because of dodd-frank. how do you see this playing out?

is it a concern for you? i think it is a concern for main street america. >> it is a concern. we have the community advisory committee. we talk with them a lot about this. on the positive side, the dodd- frank did some important reforms for consumer banks. it will help them address funding disparities by having a higher deposit insurance limit. it will save them about $4 billion. i think there were some positive things in dodd-frank. we are trying very hard to make sure laws are implemented to insulate committee of banks from reforms that were targeted towards a larger institutions.

we are very concerned about the differential in funding costs as well. we will talk about the implementation of more later. >> thank you. mrs. maloney? >> thank you. thank you for holding this hearing and giving us this opportunity to see sheila bair one last time. i will ask you to respond to what critics have claimed it -- the liquidation of party promotes bailouts because it allows the fdic to pay creditors 100 cents on the dollar. is it true that this is erroneous in light of the fact that the law requires the fdic to assure that predators take

care of their -- creditors take care of their losses. the fdic pays creditors more than they receive in liquidation bankruptcy is very limited. it is subject to their losses. your comments, please. >> i think it is important. we clearly have a job ahead of us in terms of educating folks about are processed and assuring them it is every bit as harsh as bankruptcy. it has the same credit priority you see in bankruptcy. this is consistent with our powers under our traditional receivership powers. basically, it is a two situations. continuous operations -- keeping services going, paying your service people and employees --

that is also recognized in bankruptcy. or whether it is to maximize value. that is simply a mathematical determination. we see this in by resolutions of frequently -- they will pay us a premium to cover all insured and uninsured deposits. it actually makes more money for us and maximizes our recovery to cover the deposits. we are making more money with the premium that the acquirer pays. that is an example we maximize value by differentiating. again, it is a mathematical formula. to emphasize it more, we have said that we do not think there would be a situation where a longer-term creditor pace longer

than a year would either maximize value. for uninsured creditors in the short term, they will take losses as well. we have tried very hard to assure people that the losses imposed on creditors will be every bit of ours -- every bit as harsh as it would be in bankruptcy. the 97 cents on the dollar that comes from a report our staff did on the lehman bankruptcy. the recovery will be driven by the losses and the amount of equity. as a matter of market

discipline, the senior debt holders want to protect themselves -- they should look at the equity capitalization levels. >> to put it in a framework that is helpful to us, could you explain the extent to which having the orderly liquidation of 40 during the financial crisis could have prevented bailouts and the mitigated effects? >> there were lots -- there was lots of time that limits. there were many alarms before the institution finally failed. all systemic entities under dodd-frank will have to have resolution plans on file with us. there will have to be a blueprint well before they get into trouble. the payment bankruptcy -- lehman

bankruptcy as help to resolve the larger financial institutions. we anticipate having an ongoing presence with the larger bank holding companies. the fact that there was a resolution process -- that would have been a strong incentive for the leadership to write their own ship and go out and sell themselves at a reasonable price. we see this all the time with banks. they know that if they fail and go into a process -- it is a powerful incentive to take care of it yourself. about 25% of banks have gone out and recapitalize. they are very motivated. i think that would be an important factor we did not catch during the crisis. it also provides us a sense against blackmail.

during the crisis, a lot of institutions were saying, "if we get down, there will be all these problems." the was no or early process. now we have an emergency situation. we can provide temporary liquidity support, but their shareholders and creditors are subject to law and their boards -- are subject to loss, and their boards are not. >> there are a lot of tools that we have. >> the gentleman from ohio. >> thank you, et madame chairwoman. thank you for being here. i want to focus today on the composition of your board of directors. the new composition under dodd- frank, which includes the director of the cfpb -- coming

from the private sector and serving on many boards, i have always been concerned. there is a concern about direct or indirect cost rates of interest. knowing you have to work on a regular basis of what one of the individuals, which would be the director of the cfpb, i am considered that there is a conflict of interest to a lot especially when it comes to your seat on the financial fsok. it takes two-thirds to do that. i know my colleague, mr. duffy, introduced some legislation to try to talk a little bit about this. when you have to work with somebody on a regular basis and then you go over to -- and then you go over and have a vote and

it takes seven out of 10 to block eight rule by the director who sits on your board and that person also has a vote added the 10, you limit the ability to really have oversight by easing the financial oversight council. my concern is, when you have that kind of conflict of interest, is a good policy or a good procedure -- i will introduce a bill next week that will simply replace the director of the cfpb with the chairman of the fed. i believe we need to focus on safety and soundness, yet a perceived conflict of interest -- get any perceived conflict of interest of the way. i would like your thoughts on the potential conflict of

interest. >> i think it is a good question. a lot of people said the fed was one option. i liked the rappers -- reciprocity. i think that would be helpful. i think the advantage support putting the consumer bureau head of the fdic board might help sensitize that person to sell the safety and soundness issues associated with deposit insurance. frankly, there is a close connection. to the extent people were worried about the consumer bureau had not been in the budget context of bank regulation. it may help educate that person. i think that is the argument for it. if you get to the structure for the cfpb, that might be a nice thing to have as well. we are find with this.

we would have liked some rappers -- and reciprocity in the structure. in terms of the conflict, have sought actually as the ability to intercede with pretty much any of the regulators. if they think a regulator is doing something that is not appropriately adjusting systemic risk. these are difficult questions. i think we can work with what is the law right now. >> it is interesting. you brought in the safety and soundness aspect. i read the mission statement yesterday and out of 754 words, there is no talk about safety or sadness in their mission.

>> a safe and sound bank is the best bang for customers. similarly, consumer abuses as we saw with mortgages -- there needs to be a lot of cross- communication. >> in regards to the orderly liquidation of parties, there had been a number of examples. bank of clark county washington -- $440 million in assets. citigroup -- $1.90 trillion in assets. the time, the energy, the staff that is needed -- i know i am running out of time. i would like to find out how you believe the manpower time and strain -- how would you be able

to exercise authority over much larger institutions? i yield. >> we will give you lots of time to think about that. mr. bock is from california for 10 minutes. >> i understand the fdic has issued an internal financial report to implement an orderly liquidation of 40. could you briefly discuss these rules, particularly to the extent to which they would align an orderly liquidation process with bankruptcy is or failed bank resolutions and ensure creditors their losses if the institution itself does not survive? >> the statute is clear. it ends bailouts. to the extent the governor --

government would be to provide liquidity keep the bank going -- it is a process that is every bit as harsh as bankruptcy. i think we need to reassure focus on that. the purpose was not to reinforce the bill. we have engaged with rating agencies on this. some have decided to continue. we say to them, "read the statute." they say, "we think congress will do it." they believe the congress will step in. i know you do not want to face the secretary of the treasury or the chairman of the fed asking for $700 billion. i think the tools are there to

require a credible resolution plan. there should be structural changes. if they cannot come up with a plant, it shows a cannot be result in an orderly way. >> who would enforce that? >> the fed and the fdic. a supermajority vote can require a divestiture if necessary. >> some underestimate the living will requirement which the defense and the fdic are in the process of implementing. could you discussed the importance of the living will as a ongoing regulatory tool that will mitigate against failure of large, complex financial institutions as a tool that will make this orderly resolution

most likely a rare if that at large? >> it is a divestiture requirement. they must have plans in place that will show the order resolution process. for several restitutions this is going to require some structural changes. there are thousands of legal entities that they never bothered to rationalize. getting their business operations in line with their legal structure, there is a strategy to break them up into marketable size pieces. i think international operations, there may be some levels that are required to separate themselves in certain foreign distribution -- in certain foreign areas.

some already operate with this model quite profitably. i think it is the kind of thing we need to look at ander may -- we need to look at. >> thank you. i yield back the balance of my time. >> thank you. recently the fdic completed a pilot program of small dollar loans and had a couple of different programs, one under $1,000.10 under $2,500 -- $2500. >> we were very pleased. it was very successful. the bankruptcy rates were a little bit higher than they are for other forms of lending, but the rates were very much in

line. i think the banks that participated were pleased. they gave us the information which we in turn made more broadly available to banks in general. there is a particular need for small dollar credit right now. i think having a proven model was important to us. we were very pleased. >> what interest rate did you see on these small dollar loans work? >> these were consumer loans. they were all below 36%, which is pretty high. we will actually give c.r.a. credit. >> do they think they could make any money?

>> they did make money. most of them were significantly lower than 36%. >> four two years the fdic right was not profitable. debt is what my envelope says. >> there was no interest rate cap. there was a guy that's that said -- that was a voluntary program. those were profitable. they were below 36%. >> we will work that out. thank you. with regard to the insurance fund, house of what are we right now? >> we are still in negative territory, but we should be in

positive territory by the end of the second quarter. in 2009 -- it is improving. the banking industry is improving. that represents our equity position, not our cash position. we should be in positive territory by the end of the second quarter. >> do expect to make up the difference? >> we had an increase scheduled that we did not get because the industry is recovering. >> with regards to enter change its fees, the other day we had chairman bernanke in front of us. we asked him that whenever the regulators take a look at the bank and shop all 13% of their income, will you forget about that loss of income or are there to make that up? he had no answer to that.