extremely active in his roles such as chair of the membership committee and members of the board of directors for 10 years. mr. kottler has nearly 20 years of practical experience to provide small businesses access to capital and credit. thank you for your service to our communities in louisiana and other states. i'm proud that you will testify before us all today. today. >> thank you. i think that he used all of your time here [laughter] >> good afternoon. i am excited to be here today. i am responsible for retail and small business banking at iberia bank. cba has been of recognize the voice for small banking in this

country for 21 years. i and my experiences from small- business lending, i understand the challenges that we face. over the past few years high unemployment has impacted consumer spending, which is critical to boost sales of small businesses. leading to weaker than normal in consistent demand for small- business loans. the recent study found access to credit. in addition to declining sales, another factor that has diminished the sales lending, home equity is traditionally a strong form of collateral that many business owners use to secure their business loans. study from the federal reserve bank of cleveland found the

decline of home values has constrained the ability of small business owners to obtain the credit they need to finance their business. the decline in sales has affected small business lending. when banks underwrite loans, we look at two things. cash flow, both historical and projected, as well as collateral in the loan. the decline in these criteria over the economic cycle have been significant factors in the reduction in lending. but we do see it improving. members report increases in demand for small-business loans. the commerce debarment announced an increase for 10 straight months, which we take as a positive sign that we are turning the corner. what is cba doing to improve lending? many banks have instituted programs where the bank will take a look at a loan that might have been declined and see if

there is a way to approve it. trying to make more quality loans through that process. a number of banks have announced commitments to businesses with established enhanced training through the branches that are often the primary places that our customers come to to less for loans. specifically improving -- approving programs. cba will continue to approve the expansion of small business lending and economic development. we think the small business lending fund and other enhancements are getting taken in the right direction to make more loans. this spring cba joined with international finance to finance a small business lending summit here in washington, d.c..

we have look for ways to improve lending. as a result, we are now working to develop a template for franchisers to use to secure the franchise that they need. providing information about the franchise, hopefully it will successfully help us to underwrite the loan. one final point i would like to stress is the importance of communication between borrowers and lenders. the more prepared and knowledgeable a bar where it is, the more the lender knows about the bar work, the more successful the outcome. small businesses better need to understand each other, one of the things we have been working on. in closing we are starting to see growth signs in the economy, but we have a ways to go. successful small businesses need to have strong cash flow to

prosper. we think that as unemployment falls, the demand will increase, we look forward to working with this committee and small businesses to strengthen the nation's economy. thank you for the opportunity to testify and i will be available for questions. >> i am going to rest my line of questions until the end of the hearing. i have a lot. mr. west? >> thank you, mr. chairman. thank you, panel, for taking the time to be here with us. we went over and met with president obama and one of the interesting topics that we brought up is what we are discussing today as far as lending and other regulatory burdens we have placed on our small businesses. one of the things that the president said was that these are independent regulators dealing with small businesses

and, really, the government has no effect upon them. i would like to know if that is really the case. or have you seen an increase in government regulators that restrain or restrict lending practices for small banks? it is an important relationship that we have. >> we found that the fdic regulators are inconsistently applying regulations throughout the banking community. that is what has been reported. >> banks have not seen regulatory impact. i think ultimately it is keeping more loans from being made, that

is the primary influence. >> i am from texas. there is no problem understanding. mr. west, i think that the issue, from the franchise perspective, is that we are securing our bar workers are being in consistently treated in some ways, or at least that is what the bankers are telling us. i know that it is very difficult for the individual banks to know what to do. like we are in our business, it is a difficult time for the small bank. here in the franchising side we have significant restrictions on credit based on the inconsistencies of the regulators. i do not know nothing about anything else, but we are just trying to find a solution to the

problem. >> can you all give some examples? >> i will tell you what i heard. but i will defer to the bankers unless they do not answer, that i will tell you. [laughter] >> hot potato. >> what we hear is that these loans, and again, i know that mr. gruenberg is the vice chairman and he spoke at our conference. we hear that what is happening is that it is not getting filter down to local examiner's. at the local examination level they are looking sba loans as being more risky because they are guaranteed and are therefore substandard, so they are getting pushed into more restrictive lines within the individual banks. we think that franchise loans

are good loans. but because they are sba loans, there is some bias against that. >> this is the same information we have heard as well. some banks on government guaranteed loans are ask for higher reserves than others on the same guaranteed portions. it has been handled inconsistently, exactly what mr. hall was saying as far as the classification of the loan risk rating. naturally, it affects how much capital as reserved. >> mr. jacoby? one question. in your estimation, what are the economic policy silver bullets that would enhance capital and help us to sustain a growth environment?

>> i wish there were silver bullets. two things that would really help, the first is stabilizing the housing and real-estate markets. as you hear from bankers in terms of how these loans are made, these bankers tell me the same thing always, it is the lack of collateral that has led to the housing situation. the second thing has to do with education. when we did our polling, prior to the recession and financial crisis, we found that small businesses have a problem finding people that were skilled and had the skills that they needed so that they could grow. it remains a problem. when we polled recently among its other problems, they still could not find the skilled and talented people that they needed. those are two things i would focus on. >> thank you very much.

mr. chairman, i yield back. >> in your testimony you discussed the credit conditions that have improved for small businesses, they being considerably tighter than 2006 or 2007. by no the to mention three factors. one of them being -- i know that you mentioned that three factors. the surveys that to take every night, have you seen any conditions improving so that we could be to a point where we were five years ago? >> until january of this year, we were seeing many things improving. i thought that we were going to build economic momentum. it has been dashed in the last couple of months.

i think that we could build surprising economic momentum. we could get back there, doing a few things that we could really recover from more quickly than people think. >> where would we be today if we did not infuse capital in terms of helping to present the capital collapse in the markets? i was pulling left nightly national consumers and banking customers -- i was pulling nightly national consumers and banking customers. it is hard for people to go

back and imagine the conditions at that time, but at that stage i was amongst a group of people that would export almost everything because we were afraid things were going back to the stages of the 1930's. i know that many people do not agree with that anymore. >> the small business index has increased 40 points between july of 2010 and january of 2011. what do you attribute this increase to? do you think the federal played any role? >> certainly i think -- and people disagree on the effectiveness, but we really did see the economy start to recover from a really bad point about one year ago. our numbers, consumer optimism and everything, they really did start to pick up late last year and this year.

it was a combination of things having to do with uncertainties being removed in the economy. >> you just made the comment that the economy is sustaining. given numbers we have heard on job creation, um, that could have an impact on capital availability or credit availability for small businesses. up to this point last year, we passed the small business lending fund under the department of the treasury. it is supposed to provide capital to the banks so that they can lend to small businesses. 626 financial institutions have applied for the treasury mpl. none of them have been approved yet.

do you see this as having a major impact on small business ability to secure capital? >> i do not think that anyone is really expected to have a huge impact from that program. a least not from any what i have spoken to from the banking business. i am not surprised by the results. there are a bunch of issues around that program that just make it difficult for small banks to take advantage. i am not sure that it will help them in what is seen as softening. >> when we debated the legislation, one of the concerns i raised was the fact that in a language there was no requirements in the banks to remain. if you take and access that money, you go to small business. in light that we do not have that requirement, what do you

think the effect will be on small business access? >> i am not really optimistic that the program will have a major impact. it is uncomfortable for me because i think that conditions are bad enough that we should do anything that we can. anything that provides hope in this area, i am for it. in terms of expectations, i would have great expectations. >> my questions for the witnesses will be done in the second round. >> thank you, mr. chairman. my question is more direct as well. i really found it interesting in the survey the to provided us, when 40% of our small businesses are not hiring as much as they

could, we are not talking about -- it is difficult to create new businesses. getting capital, expanding, i was thinking to myself that the small people we are protecting should be the immediate focus. it is the quickest way to get job growth in this country. i have had double digit unemployment for three years in my biggest county. primarily because it is a small business based economy. the answer is that they gave you, 79% were worried that they would not be able to justify new employees. they were worried about cash flow or the ability to make payroll. i can tell you about a lot of small business owners that have not taken a paycheck in several years in order to keep their employers employed. and then worried about the

potential cost of health care. something we have not talked about here at all. we had a panel like couple of months ago. the only thing i was surprised i did not see and hear, regarding the regulatory environment, this is much more big picture. is that not something that even registered on this part? or was it cloaked in the answers for these questions? >> i think it is overcome by the answers. when we have larger sample sizes, it shows up as a smaller percentage. >> ok. going back to the certainty and confidence issue, you had three suggestions for solutions, each one of which could take up a significant amount of time.

stabilizing housing values, education is more of a state responsibility but there are federal workforce programs that we could align with energy. i know that we are working on gas prices here, getting more supply out there and driving down the costs. in getting to these three, where would you suggest that we start? >> the most important thing that can be done, and i know this is not the view of a lot of people, but we have to do something about housing. it has had a major impact on small business collateral and the ability to lend. the wealth of the american people. in terms of going forward, we have a broking housing system. if you go back in history as to how it was stimulated, it has a

tremendous impact on communities and the growth of small businesses. i know that it is not a topic that is being generally discussed, but this will not be going to potential without growth that is much faster than people think. >> and i yield back. >> mr. cutler, you talked about the decline in lending having more to do with drops in cash flow and home collateral values over the years. regulatory uncertainty making it difficult to lend. i wanted to look at the underwriting standards. what are the current underwriting standards in seeking loans from small businesses? have they changed over the years? >> as the economy worsened, there was no question that

banks were worried about the uncertainty. certainly, they spent a lot more time asking questions of our workers, making sure that we would make loans that could be repaid. really, i think that we look at three things when we underwrite a loan. first, how the business has done historically. and then stripping the contract, the opportunities that they have. one of the difficulties has obviously been the historic cash flow in business does not look as good as it did in the years before the downturn. certainly, that goes into the underwriting. the second piece is the collateral of the bar were. that is where housing and commercial real estate appraisals have, in. clearly we have all been caught

the scent of making sure that appraisals are right and that they represent the true value of the property. the third, in small business, we look to the owner of the business to make sure that they are strong and can support the business to many issues it would have. i do not know that it says much that the underwriting has changed more than being very cautious to go through each of those steps. in many cases, the bar where does not look as strong as they did in the years before the downturn. >> is there a process that that could prevent them from securing a loan even if they were a good candidate? >> i am not aware of any. banks are in the business of lending money. i can tell you that if it grows, that is what we want to do. the real issue is getting the

jobless rate fell, removing any other uncertainties that would cost -- stop small businesses from expanding. if those things happen, we will start to make loans. lending is up considerably from the bottom, but we are still not back to where we were as an industry and an association. >> i look with interest at this program by the consumer bankers association, the second look program. >> yup. >> what would trigger someone being a good candidate for a loan? >> often they will get declined by an underwriter. what we did was, when that happens many of our member banks profits in place to have another underwriter take a look at those loans to see if there

is another question that we could ask for information that we could get. something to try to take a look to see how we could make loans. we pulled the small business community. we have seen anywhere from a 3% to a 20% lift in the approval rate. >> it looks like you had something to say on this? >> what i was going to add was -- the second look program, a lot of what we do with banks that participate heavily in the small business administration, as a second look we do see if we can utilize the guarantee on these loans that do not meet credit criteria on conventional basis. the credit criteria of our bank,

and i believe i am speaking for most banks, they have tightened due to regulations call losses, and so forth. what it means is that businesses but no longer qualify for conventional lending, it falls off their plate and lands on mine as the director of government guaranteed lending. we have been doing more loans because we look at the exact same criteria but with the enhancement of a government guarantee, allowing us to utilize the vitality of the program. >> thank you. >> we were told from the president this morning that he had very direct -- very little

direct control over the regulatory environment. you talked about the hurdles in the fdic. i ask you, who oversees the fdic? >> i think it is an independent agency. blacks mr. geiger, we will have a meeting with him in a few minutes. i was very surprised -- >> mr. timothy geithner, we will have a meeting with him in a few minutes. you heard about the role of franchising. he is absolutely right. there is an amend this pent-up demand in the industry. traditionally the industry has been counter-cyclical. when people got laid off they would turn to franchising. in our own business we saw that restaurant at the man went up dramatically, but the ability of people to open them fell to zero

because no one could get financing. you talked about what is preventing the folks from lending. i know the things that i would ordinarily expect, which is that your guest lower collateral. it makes sense to me. is there anything that we can do, or undue, as a government, to help with the money? the real-estate industry is having a great deal of problems with refinancing right now. even the refinancing -- even if you refinance a healthy loan, it goes into the troubled category. what can we do to help you lend money to folks like mr. hall? >> one of the things is to be supportive of the programs. many of our banks use them. increases were done in the

amount to lend. other things were done there and they were pretty important. banks have used that fairly aggressively through this economic environment to make loans. i think that that is the primary thing, other than just a more global economic change, that we have to work on. it will take care of a lot of the process. >> you talked about the fact in your testimony that if there were no bending out there, we would have none in the industry. -- if there were nosva loans -- if there were no sba loans, there would be nearly none. can you talk about the difference? it is not apples to apples. is much more difficult to get than an ordinary pre-market low. >> the amount of credit information required from the

bar were is the same period to do your due diligence in the underwriting process that the congresswoman asked about before, we need the same amount of financial information. however, when you apply for an sva loan, there are rules and regulations that have to be followed. if you decide to borrow money from a bank do has expertise in that area, there should not be a huge amount of difference for the individual borrower. but you do need a lender with experience in that. because there is credit underwriting of the bank level and credit underwriting that has to be done on behalf of the small business administration. basically two times the amount of work. you have forms and applications that need to be done.

eligibility checklists that need to be done. tracking proceeds, there is more of an administrative burden on the bank. the bar were themselves should not really be experiencing more problems. >> i had the great pleasure of having one of those loans one time. united iran, a great pleasure, but the conventional route was always preferable. >> it looks like that will be going after what a of these sva loans. i will give you the real world perspective on that. in the past if i had put in a restaurant or a new unit, there was already a loan that i might not have had to guarantee personally. in fact, i would not do it unless i absolutely had to. in this environment every bank is making me do that personally.

now faced with the fact that i cannot get the loan that personal bank, if i want to expand by dairy queen, which i want to, to refurbish them, through an svba program. am i excited by the paperwork and guaranteeing everything that i have? no, i am not, but i have no choice if i want to renovate my units. that is my response on sba. >> mr. peters? let's thank you, mr. chairman. let's talk a little bit about going back to the bankers situation with making loans. i know how the deals have changed. talking to community bankers, credit unions and others, certainly the deals that come to different collaterals, in terms

of the f.d.i.c. involvement often they will go into a community bank and setting, basically looking at your portfolio, looking at the collateral the to have, real estate has dropped, collateral has dropped, and as a result you need increase reserves. which seems to be the prudent thing to do. but it of course limits your ability to lend. lots of small banks do not look like great investments to people. particularly in my area. or you have to call in loans or reduce your ability to lend. so, to what extent is it that you are having trouble finding creditworthy borrowers? or is it that your own collateral has dropped in value? what is that balance? >> i can tell you from our

experience that we have been well capitalized and have had good running performance through the cycle. i can tell you that one of the reasons that i came was to do more business lending. it was something the bank lender and the manager wanted to do. by experience and our bank was that that had not had been an issue. it is interesting. i have attended some different over the last few years. i can tell you that my experience at the larger bank was that it was not. >> my experience with our bank was similar in that we have been capitalized and have been able to lend throughout the crisis. we do have issues with loan-loss reserves. on a conventional basis they are

looking more closely because of regulations and the types of collateral they are able to use. equity values have decrease. we have been able to do that and to conserve capital, as it is one of the things that that program allows us to do. credit worthiness of the bar were as, the people you are looking at now that, in to borrow money, most of them have a top line problem and not a bottom line problem. those are the things that make the banks' nervous. we used the government guarantee to do that. many banks are requiring borrowers to pay off credit lines that they have utilized all the way.

with a guarantee we can have 10 years to repay the loans. so, by applying a guarantee we increased the working capital available to those borrowers. >> there appears to be some discussion on the fees, that they traditionally have covered the entire cost of the program, however now it is being subsidized and the administration has concerns over subsidies. while they can be relatively high right now, what impact do you think it would have in a position where we do not subsidize and we have to raise those fees? are you concerned about having to face higher fees? >> on a personal basis? borrowers to have that concern. when you utilize an sba loan, of

these people are fighting for business or fighting to start a business. it can be amortized over the life of a loan. generally longer than they would get on a conventional basis. as a lender it is concerning, and i am sure that it is concerning as a bar were as well. if you are in a situation where it is the most reasonable way to continue business or start a business, then you should continue to do it. >> i have a financial background as a cpa. i have been an entrepreneur ever since then. the questions that i asked the bank now are not about fees, but payment. it is the situation where you need the credit, you need to finance something, you will be willing to pay higher feed.

there was a time when i said i would never personally guarantee, but i am eating those words today. to expand and survive, i will have to guarantee personally. putting on the table everything i have worked for my whole life. but i have to do that to grow. >> thank you, mr. chairman. i will jump in here real quick. i had a question for you, mr. holland. i have heard this as well, about possible bias against making it harder for franchisees. i have friends try to get loans on start-ups that are new franchises. they get that impression that there is a biased against them that is that much tougher. could you expand on that? i would be curious to hear what others in the banking community

have to say. >> historically people have thought negatively about startups in general. the program is not about giving away money to folks that will not pay back. it is a program where you really have to pay the money back. i think that there probably has traditionally been a bias against some of the franchises. by think that we are turning that around with these other organizations. we look at it as the glass being half full rather than half- empty. we have got to operate and grow, and the way that we do that is working together as a group with other people that want to make loans. the underwriting issues that were brought up earlier, we accept some of that responsibility. we probably were not giving the right information to these

folks. we are creating this environment where we are showing members, franchisers and franchisees', how to make that loan information available to the bank so as they will be successful. i certainly know that it has been there, and in the future we will try to overcome that. >> i think that startup loans of the most difficult of finance. often they have the least equity going in. they want to do something new. the issue more suggests that they are just harder to do. i think that one of the things we have talked about is our small business committee, putting together a template with

a series of questions about how successful the franchise has been, and a whole series of questions. we are hoping that as an industry, starting those communications, we will have more success with start-ups. >> i would be curious to hear from everyone, but it comes to start-ups, this is the age-old question. when you are not wealthy, you are limited when it comes to personal guarantee. is there anything that can be done to make that process a little bit easier? those of the people that i worry about more than anything else. we have great ideas out there, but if that individual is not wealthy, they do not have the equity out there. headed down the line, i will start with you. >> traditionally those efforts

have been financed by friends, family, other outside people. beg, borrow, and steel to do -- probably the wrong words -- a [laughter] -- [laughter] but that is what they do with initial capital coming from what we call angel investors. someone who has a personal relationship with them. very difficult to get personal investors involved in these kinds of personal business type loans. the capital just comes from the effort, from the individual. seldom in my industry have i seen a startup that can go in like that, other than through a foundation, get that startup money.

normally they have to take the first step to get into business. which is one reason we love the franchise business. by accumulating this money, they can deposit from someone else to be successful going forward. >> i completely agree with mr. hall. as i have looked at this for years, when you look at projections in business plans do, we see lots of people and we suggest that they go back to the small business center is to work on their plans. but the initial equity, when you talk about that, it is the most difficult part of the loan, the startup capital. they go to friends and family, but we will not do that financing. often what we see is that these people of access money from credit cards.

often we see that that is how they start their businesses. if they do have this wonderful idea where they have already proven topline success and they have credit card that, we can refinance credit-card debt using sba because they have already proven that they can pay it on a small basis. but the initial capitalization, if you do not have it, you have to get a gift letter from fans and families. investors. partners and so forth. they have to have some percentage of money to do that. i have information on the percentage of start of loans to sba if you are interested. -- startup loans done a by the sba, if you would like to hear it. >> very much. when we passed the jobs creation

bill, it was with the purpose of providing affordable capital to those who were not able to get it through conventional financial institutions. what we have seen is that sba is guilty as charged. we have seen a concentration on big loans. those loans will increase from $2 million to $5 million. the percentage, defined as less than 150,000, have declined from 17% to 8%. the problem with this recession, compared to other recessions, is that people lost their jobs and they started up businesses. they created businesses. this time around, because credit

has tightened and sba has, basically, those guaranteed lenders are concentrated on making the big loans. debt financing does not create jobs start-ups. >> with all due respect, the 7 7a finance record as of this year to date as opposed the 2010. 29% of the number of loans to start out, the find as businesses open for two years or less, 474 were made for start- ups so far this year as opposed to 9856 last year. start up dollars are 3.2 $5 billion a year to date as opposed to more last year.

the thing that i have seen, just in my bank, is that there had been a lot of start-ups because there are a lot of people out of work. some of these people that are out of work actually do have money to start their businesses. they may have been older, more successful, having lost a job, and they can do capitalization. as far as small or falling off, many people are using these express loans less and are using the larger loans more. as companies grow, like mr. hall was saying, of these people get above $2 million in need to renovate their stores. >> i want to go back to my original question, which was talking about people doing start-ups that do not have the

equity of the -- equity of there. what can be done to help those individuals out? we hear about people having that money, but i am talking about the people that you not. what can be done, in your experience? >> it is an ongoing process. there is no single silver bullet. it is a combination of them finding personal funds for friends and family to get started. one of the most interesting things to me as customers that come in and have discussions about what they are thinking with their banker. long before they come in with the loan request.

and then making sure that they have programs with the score to help out. that banks that i worked for in the past we worked for first time business owners, similar with homeowner training. there are a whole bunch of different things that we just need to put together, as opposed to one big thing. >> anything to add? >> asking small business owners, from their experience, what they did right and wrong, one of the things they highlighted was not starting with enough capital. they tried to get in and did not have enough capital to make it.

in this environment some kind of availability of a minimum level of capital is even more necessary. they will not have immediate success. you need a capital foundation in this environment. >> who is next? you testified before that the issue is a coupling issue. or demand. for businesses without adequate demand to support pro forma, it allows them to come back and secure the loan. and that is inhibiting their ability, from a financial perspective, to, in and be

successful in the loan process, because they need to grow from the top line. is that a fair assembly of where you think businesses are at? >> i am saying that existing businesses right now, not start- ups, i am saying that what we are seeing is that the bottom line is profitable, but some of them have been experiencing downward trends in the top line so that for us to make a loan, we need to see that the bleeding has stopped and that they can still pay, or that it is back to increasing again. >> obviously that puts them in a position where there is not as much demand for bank loans. without growth in the top line, they do not need to increase their line of credit for resale.

>> well, they are still funding receivables and sometimes they need short-term capital to fund daily activities. even the level of business that they are doing, they still lead short-term credit lines in order to operate on the regular cash cycle. >> but i assume they are not increasing the level of bar wing? >> it all depends. many of them still need to maintain. >> i did not say maintain. i said increase. they are not increasing borrowing because they do not have additional sales product that they are purchasing. did you want to comment? >> let me put it in a dairy queen perspective. i will have to borrow money to

maintain by assisting business. you can be in business and not keep up with competition, you will slowly be going out of business. i would say to you, in my personal case, i will borrow money without the expectation. at the end of the day i will have a lesser bottom line, and it may not make much sense to you, but if you think about it, if i base goes away, where blood put my money? what i am also doing is growing jobs, keeping my system in place. >> is it more of a working capital loan? >> when i have to borrow that

money from construction, certainly it would be a capital loan. margins are so thin, there is literally no big cushion. giving this much return in a small business environment, it is partly about keeping these people employed and businesses going. >> something that mr. jacoby said before, focusing on housing would do a number of beneficial things.

what is the solution there? i am curious, the bankers that we have on the panel, do they have a lot of foreclosed properties on the balance sheets? or is that not an issue for your banks? let's for minded is not, but certainly for a number of banks, they have been working through those issues. starting with start-ups and other small businesses, once the bar were gets beyond personal credit-card savings, where they go to next, either as a personal business loan, equity values

have gone down, especially in certain parts of the country. it has taken away that source of collateral. m >> the real solution is to get a bottom in housing so that everyone can start improving from that point on. everyone is fearing the double that in housing. i think that traditionally some people seem to be moving away from that. but i think that the nation needs to value homeownership, doing whatever they can to borrow in a sitcom -- in a secure environment. if the price of the house you

are going to buy goes down by 5%, you can lose your down payment. i think that people underestimate how much housing yields. >> thank you. >> in my community, some of the smaller community banks were particularly hard hit. some of the big banks in the financial crisis for example, capital reserve added 20% increase. their market nietzsche seem to be, in terms of small business

access to capital -- could you comment, in relation to community banks? was he overreacting? anyone? >> we are a little bit larger than a community bank with $14 billion in assets. our commercial real estate division was most hard hit in the banks. as far as overreaction is concerned, the perception is that the amount of capital that you have on reserve now is going to be look that are around 10%. i do not think that they have -- well, are you saying that regulators have overreacted? >> i do none know if they

overreacted. >> but they did act appropriately in some cases. >> most bar were as i know what the smaller bank level, that was -- most of borrowers i know what that level, they were facing increased regulations. from a borrower's perspective, as a general comment, the regulators, in good times, it seems to me that they should be more conservative in trying to get you to put stuff back and in bad times should be trying to help the good borrowers get through the tough times. really because of something they have not had much control over. well, unfortunately, i think that community banks are in the

sec same positions. getting together for a supply and demand situation. >> i have had a number of bankers and for me that even if they had performing loans in commercial real estate, that those loans were downgraded. that maybe they should have had a walk to put on them. but with a pool of money for capital reserves. anyone else with comments them of one less related question -- anyone else with comments? one last related question about access to capital. i was a small business owner. the majority of small businesses are structured as such.

in terms of job creation, what would be the effect of increasing rates knowing that these corporations, essentially, that it is a tax rate that you pay? would anyone like to comment? please them >> -- please? >> i am a sucker for this. most of the money comes through the personal income tax return. no one will tell you that i want more taxes. i will tell you that i am not afraid to pay what is fair. we have been hit with the alternative minimum tax and a lot of people, their business income is flowing through to their personal income and

they're not getting any deductions. it sounds like a lot of money, but today's environment, you're trying to survive and capitalize your business out of your personal situation, which is what all small business people do, as a taxpayer, i don't have to -- i want to pay my fare share, but i also have to survive. if you start taxing, and i'm afraid with the same situation with health care, you're going to lose jobs. in the real world, you're going to lose jobs because we are squeeze so tight right now there is no place for it to go. >> thank you. >> thank you very much. i would like to thank the panel for their in siple testimony. we all understand when alternations small businesses are active participants in an economy that adds jobs.

will our nation fully recover from the downturn? following those regulatory environment to return to one that allows for the financial collapse in the first -- in the first place is irresponsible at best. illustratesimony the difficult task facing our nation with the consumer spending highlighted as the top concern for small business owners with regard to hiring. this fact feeds back into any make consumer spending. the fact that private lenders are not lending even to those who would be deemed creditworthy has led to that issue that was pointed out regarding the program approaching its ceiling later this year. given that there is a need and recognizing that returning to lax regulatory environment that

caused our current problem would be unwise, what else is needed to incentivize private lenders to free up the capital that allows small businesses to expand and hire which would turn around a weak consumer spending and get our economy back on track? >> that's a really tough question. there are a lot of things that could be done that would encourage local lenders to hold more loans. everybody who has tried to figure that out has had some difficulty in terms of how to do it effectively. you have tried with various kinds of programs. the big thing is to try to get consumers spending again and that's a larger issue. once that happens, everything turns positive. if you can figure out a way to

hold more loans themselves instead of government programs, but get more loans and some incentive, that would help out also. >> utilizing the government programs, even at that level, i agree that consumer confidence and consumer spending is hand in hand and that's all tied up with more jobs, more disposable income, and so forth. if we can continue to try to get the money out there to businesses that hire people, the outlook will go on, but it's a very difficult situation, and i tend to agree that until the home level and the values in their homes comeback and they have confidence they're not going to lose their homes,

that's the priority. that they have jobs and money to put on the table. i think the banks are doing everything they can with the tools they have to get money out there to small businesses. i know that in our bank, someone asked about the foreclosure rate. if the people are paying on the loans, we are working with them and even though they have been downgraded, because the regular surf forcing us to downgrade, if the loans are being paid, they are still in the bank. the banks are trying to work with the people they have lent money to to keep them employed, to keep people spending money and it's a cycle. >> you are a capital one, you have to have the answer.

it is -- >> is interesting when you watch borrowers. they come in and they want working capital lines of credit to fund new contracts and want to purchase new equipment which leads to more equipment for more jobs. coming out of the bottom of this recession, we started to see loan demand go up for things like i want to buy the building i'm in because i have been leasing it and it's worth less than i can get a deal on. i want to buy my competitor who is weekend. those kinds of bequests don't necessarily create jobs. as we get more consumer spending and more economic growth, we will start to see those loans from established businesses see the kind -- be a kind of loans there willing to expand.

we have seen less of that up to this point. third >> did you want to add anything at all? i yield back the balance of my time. >> i want to thank you for your time today. this committee is about small businesses. we're going to do everything we can to provide access to capital for other small businesses. the ranking member and i are wanting to help start-ups as much as we can. i would ask all members have 5 legislative days to submit material for the record. without objection, so ordered. the hearing is adjourned. thank you very much. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]

>> it today on "newsmakers" representative sander levin will talk about how to address debt and other economic issues. that's at 6:00 p.m. eastern, here on c-span. monday, our "road to the white house" coverage continues with former senator rick santorum as he makes his official presidential campaign announcement. that's live from somerset, pa., live here on c-span.

the center for a new american security held a series of panels earlier this week on military operations in afghanistan and pakistan. in this first panel, you will see lieutenant-general david rodriguez, the no. 2 in command of nato forces in afghanistan talking about the situation there and his outlook for future operations. later, the discussion broadens to include pakistan and al qaeda with a former assistant secretary of defense from the reagan administration. this is one hour and 45 minutes. between sessions and we appreciate by that standard this conference is so very successful but we your deeply honored to have with us today at least an avatar former lt. general david rot rodriguez as the speaker of our annual conference. general rodriguez assumes

command of the international security assistance for the joint command ijc in october 2009 and is joining today from fort lewis, washington, where he's a lieutenant general core get ready to assume operational responsibilities for the mission in afghanistan leader this year. .. he is going to address us on the subject of afghanistan 2011.

and, if the gods of the internet cooperate, he will take questions. over to you, sir. >> good morning, everybody. and john, thank you for the kind introduction and theeak before s distinguished audience. i apologize for not being there in person as you said it currently and that washington state enjoyed these clueless bookwork kentucky trading to prepare ichor and the afghan -- i'm sorry, the european rapid reaction corps for their upcoming deployment to afghanistan. and my friend, lieutenant general scott bradley will take my place. we have done this at brigade commands, division command, and i feel sorry, but he keeps getting stuck with the mess that

i leave but i know he'll do a great job. i'd also like to recognize members of the cf team. john kerry thank you for inviting me. you've been a practical server and commentator on this mission can see now cnas. afghanistan for pakistan in iraq for the marines and thanks to you also for your leadership. you clearly understand challenges we face in afghanistan. lieutenant general retired classmate and close friend, the first officer of the coalition command in afghanistan back in 2003. thank you for charging of course in afghanistan that has opened the door and courting myself.

the former army ranger search of both iraq and afghanistan. you know the ground situation, what goes on there. it is great year here and in short the cnas team is definitely afghanistan strong. okay, this path goes this morning. i will give you a short overview of the operational plan from now until 2014 and discuss in more detail where we are currently in that plan. i'll tell you what i think is going well and what worries me. i went with a brief comment on what they think the future is regard to transition, driving down 2014 and beyond. so first, what does the campaign the click? well, our object has remained the same. to deny al qaeda sanctuaries and prevent the taliban from retaking afghanistan. and by the way, the death of

osama bin laden has not changed that ashamed and we have not seen any effect to his death on the ground to date in afghanistan. next slide, please. the unique foundation of this plan is threefold. on key areas, prioritization of multiple lines of operation, an approach that very much assembles with the activity. with regard to the focus on critical terrain, the population centers, commerce was a matter of necessity an operation that had never been lavishly resourced. i remind everyone to peek at troop deployment in the p. cost of operations in afghanistan was two thirds of the troops deployed in iraq and 100 -- two

thirds the cost of iraq operations for a country 1.5 times the size of iraq. now the effect this focus has had on key terrain was that we are largely able to focus the majority of coalition and international efforts really need them and when we need them. and when we get this, our resources are sufficient and i can't over emphasize what a idea that the vent to our effort. since the peace operations decade of the 1990s, we have long talked about the importance of the idea for, where there is no form a unity command and the progress in this regard has exceeded expectations. we have managed to take the afghan security forces to focus in the right place and we have gained support of many of the civilian neck turns to direct their terrific people and

programs where they need to hold key terrain that has been cleared. by making a big deal about key terrain can we have given specifics to anchor on. in this focus, we have made explicit the building block of the district. this is where the people see their government, and action or not in action. they are important as they party said. this does not apply to the province or kabul are not important, but this is a row insert the good of the challenges lined the village and the first line of assistance for the villagers is the different government. now, there are those who think we do too much when we focus on defense. but there is no real alternative for the reason i just said. this key terrain construct is perfect? well, of course not, but nothing ever is.

with regard to sequencing and prioritizing length of operation, the plaintiff made very explicit plans and attempted to correct some challenges from the past. some practices actually made the situation worse. as you know, we have incredible developments all over the place and want more children out of school at more reasonable, the security situation declaimed. then we have more troops and resources and cleared areas much more days, only to have to clear over and over again. now we are much better off. we spend the bulk of our military effort on to creating or insurgent infrastructures to include the leadership, but we also ensure the planning for the security and good governance begins early enough to be inserted and follow on this unit conditions allow.

we have made real progress with their civilian counterparts, both in the afghan government and international community to sequence and synchronize these efforts. thanks a lot. finally, underpinning the execution of this plan is the recognition that absence of sweeping political settlement, the best chance of stabilizing afghanistan is to mobilize people to demand the fulfillment of their modest requirements. now this is dependent on the connection of the good government to the reliable security forces and to the people. and when all three legs of that school for the trinity work together, from the bottom, with a little help from the top, we will squeeze out enough of the enemy of the afghan people to build sufficient stability for afghanistan in the future. now you can see from the weight of the air is on the chart what people need from kabul is indeed

minimal. their destiny to be a small reliable steady flow of funding for national to local levels to fund operating costs and minimal basic services. what this also means and execution of the plan is there a young commanders on the ground have to make decisions every day about how to allocate their precious resources of time and effort. they must ensure the proper weighting between taking the fight to the enemy and strengthening communities by building capacity in connection of the good government reliable security forces and to the people. this trinity result in a spiral of popular mobilization and it works. so how has the campaign unfolded and how will it unfold? in a moment, i will highlight the gains we expect to achieve and i will tell you that unequivocally where we have

focused our efforts in accordance with our plan, we have achieved progress every time. so if you ask me if i am hopeful that we can achieve sufficient security across the country, i am indeed. of course operational and tactical successes will take us only so far given the time constraints we believe we will be under. i will talk about more of this later. i do believe that given enough time, the tactical and ground up approach will prevail, just as it did in iran country a couple hundred years ago. now these next three slides show you the expected results of executing the plan. in other words, expanding the areas should be stable by winters and 2014. and by 2014, we will have fully executed operational plan and

all the places that matter most. next slide. now you can see where we want to be by spring of 2012. it is important to understand what the spring brings to us because it is after a violent season in the stomach of these through the fall and in the wintertime there is a huge opportunity to continue to go the afghan capacity while the violence tapers off a little bit. and you can see they are what we want to do a six in that area down into the central helmand river valley in kandahar in the south and southwest and it continues to build a security zone outside kabul to the east and to the south. next slide. you can see on the next slide how that would expand over time. it is expanding everywhere

throughout the country, expanding more and more to mark the afghan population and needy production centers and commerce routes. next slide. you can see in 2014 how it really starts to expand to other places the half and and us believe will create enough stability to stabilize the entire country of afghanistan and it does not have to be everywhere as you can be. you can see we will fight on in the east and frankly the east will be the toughest part of the tough neighborhood that will be afghanistan for a long time. i won't go in detail in the plan of 2014 right now if this is the purview of furniture commanders and could change. as we are all fond of saying come in the has about and nowhere is that more true than in afghanistan, given the volatile region in which it resides.

i will talk about where we are in operation only. and by the way, let me know hope is not a vested, popped in to senator has been a setback. the name of the plan was hope and i assure you that the afghans have seen the plan not because it is dependent on the lettuce prayer and hope, although my experiences that never. but because the plan will result in greater hope in the heads and hearts of the afghan people, hope for a better future that is more akin to what they observe happening in the rest of the world. and believe me, they do know what is going on outside the boundaries of afghanistan. now we started in the central helmand river valley, number 100 as it was the nexus of the narcotics industry that feels insurgency and the insurgency is strongest hold. our pakistani part is called the

taliban central. that was last year. this year after a very successful when you campaign, we see the central river valley near stable but the insurgents ability and capability drastically reduced and pushed a small pocket on the edges of the central helmand river valley and in the northern helmand river valley. this year our main effort is in kandahar and connect in kandahar and it's a magnet to the central helmand river valley, which is linked between one and two. and i will talk about carbonara as an example of what is happening in around kandahar as well as the central helmand valley. it is outside of kandahar that has been a attack places the first in the coalition went in and state. in july 2009, are good and was a

taliban stronghold and people could not move around without fear. in early january 2011, the district governor was killed. the district police chief was wounded by an ied so he couldn't continue to serve in his payment. there were no government officials present except the district governor and a tea maker and the police were not present among the people. the district center was described by many as jesse combat out post because all it did was defend itself. i was just a recently and the change has been incredible. there were more than 16 government employees working within the district governor. there was a new police chief whose police force was visible, present among the people and

responsive to those people. and there is a local sheriff that represents the people and holds their governments accountable to those people. and the locals on a friday afternoon afghan family time i routes enabled to pick nick temirkanov river valley. a significant change from 18 months ago. now the activities occurring are examples of what are happening across the country where we are focusing our efforts. kabul city, number three on the mount, home to one fifth of the afghan population is one of the safest places in afghanistan. the afghan security forces are in the league for security throughout the city, proving their afghan security part cursor up to the challenge of increasing not only quantity, but quality.

now we are continuing to expand the kabul security zone for the east in the south and in the east we have seen gains in discrete areas in jalalabad, kandahar which is four on the map as well as send word back, just south of kabul city. these contain the most difficult human terrain and many of you know, gc cannot just transferred authority for the region that the first division. where jc was able to do what dan is the ipod is truly incredible. the afghans the same you can carry 200 notes in one hand. i believe we are attempting to do just that and it's pretty remarkable. still we have a way to go in the east and nowhere will the afghan security forces be challenged more. next slide. up in the north, just last week

we lost an influential afghan leader, regional police chief general david as well as the provincial chief of police in several coalition force members. esfnd ur thcrouoncommander, marcus tonight was wounded and is recovering at home in germany and will return soon. we expect this kind of attacks to continue. the taliban cannot expect to regain territory. so right now they are attempting to degrade to trust the coalition and afghan sending each other through insider attacks as well as to intimidate the people in hopes of making them believe that their government cannot detect them. but so far, the partnerships remain strong and in many

places, the people are eyeing the fact that the government cannot protect them. and regional command north, determined team was back very publicly coming meeting with general present another afghan security force leadership two days after the her thick attack. in kandahar several weeks ago, after the same type of horrific attack, the very next day after the simultaneous won't roll in effect to the tax. , the residents resumed their normal activity. next slide. now, our security activities in the north have focused on the kunduz carter, number five on your map. this area is an intensely populated section that includes

two main commerce routes. we have focused our efforts on expanding a secure area around the intersection and increasing the freedom of movement in that area. number six on the map is also very important because that is the last place to be completed on the ring road. as a result of regional command west, spring operations are making progress there. we have paid significant security gains enough area that will allow this to be completed in the future. arrived, number seven on the map as a city largely free and ready to initiate the transition process their afghan leadership this summer. yes, there was an attack thiseen security forces did not allow the enemy to reach their intended target and this is a trend that we are seeing more in

her across tree. the increasing desire and ability of the police and army to take their own security challenges, rendering the insurgent attacks increasingly enough that this. now last year was the implementation of a plan for synchronization and the neocons of understanding of the required approach. we have proven that where we, the coalition in the afghan, the coalition in the afghan, the coalition in the afghan, the coalition in the afghan. next slide. so where are we? progress in achieving our objectives, making afghanistan a place inhospitable to terrorists is indisputable there remains fragile. there is no doubt the afghan security forces have grown in quantity and quality. growth remains and a schedule

with more than 284,000 afghan security forces across the country. since 2009, there has been a 50% increase in the number of afghans security forces and today in key areas across the country, the vast majority of the afghan security forces are partnered closely with isaf and there is no doubt they can and will fight in their operational effectiveness and destroying the enemy and protect people. our partnership has given afghan leaders like general carini, chief of the general staff pictured on the mac side and his leaders at every level and his units at every level the courage to confidently use ghost beard he had been developed new ones. next slide.

that's general carini addressing some of his afghan soldiers. if you can see the look of confidence in his afghan soldiers icily tax across the country, you couldn't help but be impressed. and i always fan. next slide. there's also no doubt that the government presents physics and being. there is no doubt that afghanistan contains the required elements and irreversible progress. but if human capacity to meet the afghan needs, an immense source of income for natural resources in regional transit. afghan national security forces are on track to assume the lead and largely the right government initiatives in place. i want to return for a moment to me first point on the subject.

the single most encouraging factor throughout my time in afghanistan has been the human capacity of the afghan people. their resiliency after more than 30 years of conflict is remarkable. over the years, i have met many inspiring leaders in people. they are tough and determined and have a sense of humor and graciousness to those who respect them. i am not ashamed to say that i generally write and respect many afghan people. while we are not there to make friends, it's hard to believe the most important resources and a country, organization or nation had a sound in a country to which we have devoted many of our most precious resources. next slide. as is often the case, the greatest strengths can quickly turn to weaknesses in the resilience of the people more to

his survival attitude that is not healthy. the people have formed habits to keep them alive in the face of terror and this often means they won't stand against members of the taliban for whom they have very little affinity. now there were other things that worry me. i am concerned about a chart on that is not totally aligned with trying afghan capabilities. was so rapid can you please make mistakes or temporary relief caps. while not critical in and of themselves make the people's shaky confidence waver and their survival instincts rose to the forefront. now if this happens, the taliban can regain a foothold among a fearful population. i am also concerned about support for the insurgency that continues to flow mostly from the every species of pakistan. the worse the problem becomes fair, the stronger we have to build the afghan national security forces and the communities people living.

this may take more time than we have. finally, i am worried about the parochial interests of minority formally informed the leaders across afghanistan, whether they are representing their own families accumulation of wealth, there groups were in the morpheus ever shifting combination of interests have forsaken alienate the afghan citizen, this is unacceptable. the afghans together with the coalition have to start addressing these challenges were effectively. a corollary to that is we have not yet managed to strike the right balance between respecting afghan sovereignty and demanding adherence to the non-negotiable response abilities that company that poverty. essential among those responsibilities include factions to stop the leaders who steal money, opportunity and respect from the afghan citizens. in my mind, absolutely paramount

is the demand the afghan government stop formal and informal powerbrokers who were directly harming troopers. in further support of the enemy, they don't stop and we should do that through whatever means necessary. now i will talk recently about the major movements the future brings. no answers but a description of things were grappling with. transition. transition will be conditioned based progress with one caveat will recognize the court's afghan politics will sometimes put on the ground from time to time. the afghan leadership will have a need to balance across a victim powerbroker lines. the first tranche has been select it and these are the easy ones, promises and municipalities that have been in good shape for years. transition tougher areas will involve thinning out of coalition forces from secure

areas to be deployed. they started this top with operations to emphasize we will not choose transition. there is no faster way to dilute our efforts that we worked so hard to focus for the last several years and then do and continue to execute a plan that the afghans have developed with this is a natural outcome of the transition. the second tranche should be selected by afghan leadership in august and it is on track and it blew the plane to get the afghans in need for security by 2014 is achievable. i'm drawdown, jennifer truss calls himself a four-star action for this issue. therefore am not at liberty to discuss details and also they are not yet determined. at my level, i am emphasizing to the field commanders we've got

to push afghan partners to start reading more and more. we have to start taking more risks in this regard and have more than none. we know as the platoon and company level, the afghans are largely capable of conducting operations with the assistance could we will win out from the bottom-up, focusing on building headquarters and eventually leaving in place critical enablers such as medical evacuation, access to joint the facts and intelligence surveillance and reconnaissance assets. finally, 314 and beyond. i spoke briefly about how i see the campaign unfolded from now until 2014. before 2014, we should have a strategic agreement in place that will offer a sharing to vote the afghan people in the enemy. no other details need to be worked out, but it is critical

we transition our relationship from one of wartime, expedia footing to one of normalization. next slide. now this about wraps it up. i have not discussed reintegration at the afghan local police programs posed accelerants and a part of growing confidence on the part of the afghan will. and now i am happy take questions on these topics with others who are interested in. thank you for coming today in thank you for your interest in afghanistan. >> thank you richard burr rodriquez. i will take the liberty of asking the first question i'm going to pick up just for you left out. you describe the class take counterinsurgency necessary but insufficient. can you talk to the reconciliation reintegration efforts many people think are going to ultimately be decisive.

>> yeah, i really focus my answer on reintegration. and where we have had success and where the afghan security forces and the afghan government has continued to grow in their capacity to lead their nation, where the afghan people have become mobilized because of improving security and improving government capacity, the afghan people are ready to reintegrate and the afghan foot soldiers have been a big part are ready to reintegrate and become part of the communities. that has occurred across the areas we've been successful in just under 2004 what programs and the same number are on the verge of entering the program. so the success continues to grow in security and governance and develop it would have been more

and more. as we continue to reintegrate more and more these foot soldiers into society, it's going to put a lot more pressure on the reconciliation efforts and also give us a better position from which to negotiate room. now, it is interesting when this was mentioned to president karzai, he is convinced if we can reintegrate all the local people, we won't have to be worried about reconciliation. again, that is opinion and we'll have to see how it goes in the future. it is a huge accelerants. and i started and continues to grow every month and we believe it will be huge accelerants are building momentum here and we have to be able to do that based on the growing security and governance that keeps improving throughout the country. thank you. >> thank you, sir. other questions? writer in the blue shirt.

he sat up and identify yourself. >> i'm jake filiberto, marina 2001 and iraq 2003. thank you for your service. i am a freelance pundit in a spirit a coalition called veterans for rethinking afghanistan. so i may be a little bit different. the question is i was in afghanistan a little bit ago when i talk to minister asked graham who is in charge of the taliban and reintegration program from the afghan side and the yediot not spoken with military commanders are state department officials, which is critical. have we made appropriate steps in your opinion to connect with them, work with them and partner from the afghan side, not just the military insurgent type. >> in response to your question committee answer in the reintegration of the net is absolutely yes. we work every single day with the afghan reintegration

leadership in kabul. we also work every day with our military part errors and afghan security partners at the provincial level, where they have a provincial reintegration council and we absolutely do that although we have been down. on the reintegration issue, i am not in charge of the reconciliation effort. you have to ask the state department and other leadership level, definitely. thank you. >> i'm going to pass on a question that has been treated. last year general mike flynn wrote a paper called intel, which is very critical of the intelligence system in afghanistan. in particular, the afghan forces and the afghan people need a number of sessions in the paper. have any of those been implemented and are you seeing results from a different focus on intelligence clicks

>> absolutely i see great results in that area. we built the whole igc around organization called the information dominant center that caught information across a broad spec to the things that are important to a counterinsurgency strategy and information needed to be able to adapt plans and operations to conditions on the ground. the depth and breadth of what is understood in the information dominant center that supports on the fire after it is truly incredible and i think if we brought mike flynn back there to look at that, he would be astounded at the incredible difference the situation provides us and provides the afghan leadership that enables a more effective use of resources we have. thank you.

>> i can also let the enemy is no general is on the ground with all these efforts here. >> thank you for your service in afghanistan. i'm time i turn national emergency. the question going to your assessment of the enemies both this season, and the brutality and campaign right now appears to be focusing on as many writers have offered to us from inside afghanistan and the folk scene on the confidence of the afghan people in their security forces and police forces. as you alluded to since january, there've been three prominent police chief killed by afghan infiltrators. of course infiltration attack

that was her school students as well as a couple others on recruiting stations. it's a timeline or tactic for insurgents, but there's a number of writers that say this is undermining the coalition strategy and is causing afghan people to question whether the security services can protect themselves, much less the afghans. what do you in your camassia's trajectory of this campaign of the taliban and how do you account -- the forces to be to protect themselves? >> again, first of all, that is going to be the exact tax the enemy takes because again they can't control and regain control to people they had before. they will continue to attack and control the people, which is why they're going after leaders and national security forces and

after the elders who are leading communities to a better future. we will have to lead our way through some tough challenges. the afghan national security forces have done very, very well and many of the situations and in other situations of course they need to do better. that is going to be what we all have to do together daring. government better control their people. now on the other thing that is important about this is to actually watch and see what goes on for those attacks have occurred in the real important part is how fast or how far does the afghan community returned to the census normalcy. despite that has continued to respond that way.

we are going to have to really focus our efforts to prevent these horrific attacks from ever changing the confidence and trust the afghan people have increasingly thrown in areas. >> my question has to do with the way things are evolving and how things are going to be different going forward. what kinds of different skill sets or roles of the afghan security forces be taking non-and if there are new responsibilities and skill sets needed, what kind of training do you envision taking place?

>> yes, as we look forward, this goes double take the longest to the afghan national security forces to develop a sophisticated command and control requirements, the ability to integrate intelligence very broad range of intelligence system, the ability to bring joint effects to support efforts. -- too bad

those are the types of skills sets that will be observers that will be needed in the future. and again, that's why and how we will thin out our forces that will be taken away first to forces who were directly in the fight. temperature soldiers and police are directly in the fight will move this out first keep headquarters and skill sets i just discussed in the various little bit longer as we shall doubt or capacity of the national security forces to properly secure their country.

>> i've got one last question, which also was treated to us. general, can you talk to whether and how the taliban strategy is changed in the past year and whether you think those changes are permanent or temporary and reversible. >> the taliban strategy has changed for a couple reasons. one is they no longer control the support bases in the populations, the main one they had both an essential helmand river valley and kandahar city as well as many other examples. they are coming in without the huge support they had before. they have adjusted tactics like was mentioned earlier about focusing on things eliminating ability to control the afghan people. and those are the afghan national security forces, afghan government and afghan leadership that is not the focus of targets. so the way they are going to

purchase the shares just like we said thus far is going to go after sensational attacks and leadership in the half to go after the inside and the trust and confidence in the afghan national security forces and the isaf forces and they're going to try to shape the trust and confidence that i've been developing in the afghan people. >> sera, we're going to to lechee back for the responsibilities they are about to assume and were going to hand over your west point classmates comment dave barno who will talk more about the regional strategy. on behalf of everyone here for american security and frankly all of us in the united states, i'd like to thank you for the sacrifices they are making on our

this is the last event before lunch. this is a panel that needs no introduction. if you do not know who the four distinguished individuals are appear with me, perhaps you are in the wrong ball room this morning. to the far right, the senior adviser and senior fellow at cn as. he commanded 20,000 u.s. and nato forces in afghanistan and served as the director of this subject at nbu. his time at kabul is widely regarded as a gold standard in relations with afghanistan. to my immediate left is the president of the new america

foundation and former boss of mine. he spent 20 years as a foreign correspondent and senior editor at the "post." what is amazing is that he managed to write "ghost wars" well-being of the managing editor at "the post." to my right is ambassador and patterson who served as ambassador to as lot of odd from 2007-2010. she served as the assistant secretary for the inl bureau at the department of state. her tireless work burned her [unintelligible] she was nominated to be ambassador to egypt. to the far left is bing west. he is the author of seven other books, including "the village."

it has become a must read for soldiers and marines. he served as assistant secretary of defense in the reagan administration. but when he is in afghanistan, he is just one of the guys. he's right up there with the lance corporal, walking points. i asked one of the marines what was like having around. without a pause, he said that guy has brass balls. we're going to forgo the usual opening statements and get right to the conversation. i'm going to skip the bed set up. we all know the set up. -- i'm going to skip the set up. let's begin with the most significant development this year or perhaps for some years now in the broader fight against terrorism, the killing of a sop of london and its impact on the future of al qaeda.

particularly in yemen, where there is a danger of aqap expanding. i would like to focus on pakistan and to a lesser extent, afghanistan. with his recent replacement spending much of his time in custody, with the cia positron campaign eliminating numerous mid-level commanders and new efforts to restrict the cast -- the cash they need to operate, with the idea of peace talks with the government, is al qaeda a spent force at the moment? >> know, but they face a succession -- no, but they face a succession crisis. al qaeda is many things. it was a core organization that at 20 plus years of continuous

histories until may. it was a network of like-minded groups which occasionally collaborated, a series of franchises in diverse parts of the muslim world. it's also a brand, a fund- raising mechanism, a position and the winds of followers who may never be an al qaeda leader. in that light, what are the aspects that matter most? first is the succession. al qaeda was founded as an organization in a series of houses in the summer of 1988. it has had the same boss ever since. now it has to find a new one. in the circumstances, the succession will be very difficult. everyone who is a contender is in hiding. you cannot have a series of human-resources interviews at ride out a job description. it's going to have to be done under enormous pressure.

i don't think anyone on the horizon can replace the symbolic role that bin laden held. he narrated the war from a position of credibility among his followers. his credibility was rooted in 9/11 to some extent. then there is the question of why it is al qaeda now you will? it is a learning organization. it does a lot of things, but mainly it is useful because it helps raise funds and attract recruits. it attracts a certain kind of young person.

was it ever ran more like martha stewart or donald trump located in a single individual or more like nike, that " people wanted to be around it? we will be able to watch the value that al qaeda creates four others over the next couple of years and see if they adopt that terminology or if they run away from it because it is poisonous and might get you on the target list. i think you will see more disillusioned than not. al qaeda in south asia is blending with breakaway splintered sections of pakistan routed grooves from the punjab. individuals from those groups

are coming up to the frontiers and connecting with international trainers and volunteers, some of whom call themselves al qaeda and then waging violence against the state of pakistan and afghanistan. whether al qaeda continues to strengthen as an organization, that suit is going to continue to bubble and create a lot of violence in the region. there is an incipient process to determine whether sections of the taliban leadership might be willing to engage constructively in negotiations with the united states. other parties in the conflict were not. the u.s. has made it quite clear we would not consider such negotiations and a serious way. the taliban broke with al qaeda and of meaningful way.

secretary of defense gates said in an interview that moolah omar and -- it might create space for al qaeda to take decisions it did not take previously. there was a mosque built in downtown kandahar. when the taliban fell in 2001, there was a marketplace under construction in downtown, are that had a sign saying to the fact that coming soon, a shopping mall by osama bin laden and mullah omar.

omar has had plenty of opportunities to break with al qaeda. he has failed to do it at every intersection. by credible accounts, there are discussions about why the taliban has refused to break with al qaeda. the personal relationship with osama bin laden has occasionally surfaced as a factor out of omar scammed, but he has been exceeded resistance to such a break. >> i want to come back to a couple of these things, including those do of other like-minded groups. i will bring in ambassador patterson into the discussion and lean toward the impact of all this on u.s.-pakistan

relations. indeed beyond afghanistan report, let me quote a little bit from it. pakistan remains deeply conflicted internally and pervasively anti-american and will continue to behave in ways that are contrary to u.s. interests. recognition should heavily influence u.s. policy decisions. let the u.s. remain committed to the people in the state of pakistan for the long term. the most promising policy choice in a field littered with poor options. do you agree with that assessment? how should the obama administration pursue that commitment? what is the balance between embracing them as a strategic partner and demanding accountability? the pentagon brass have bragged about the close relationship.

is it masking fundamental differences that have not been addressed? the u.s. military have been a close relationship, more than what their relationship actually delivered. last week's visit did not bear all that well. admittedly, feelings are still raw, but what are the next steps that the administration should be taking? how should washington reset the relationship with pakistan? >> let me take a step back about the overall national interest that we have with pakistan. as steve pointed out, they have a raging domestic insurgency in what is a witch's brew of terrorist threats to the state.

they have enormous social and demographic challenges, perhaps more than any country on the planet. we need to reflect on the long- term view of our relationship with pakistan. i think the report was excellent and had a lot of good ideas. pakistan is a country rife with contradictions that drives americans to enormous frustration, but we had no choice but to continue on the path that we are on, which is to engage with pakistan to try and make the civilian government stronger. the obama administration has doubled down on most of the insistence -- most of the assistance between reimbursement and standard military assistance. it is running about $2.50 billion a year. in my view, we have no choice but to continue those projects and continue to engage with

pakistani leadership. i would take issue with your statement that the military relationship has not borne fruit. all pakistan is a country of immense frustration, they have also been our partner in the counter-terrorism war. i would like to make one final point about the way forward with pakistan. i think americans underestimate how much influence in the house on itsstan's psyche and relationship with us and with afghanistan. it is hard to underestimate how t andeconomic clou international prestige have affected pakistan. one reason our relationships are so complex right now is they see us as having thrown them over for the prettier girl next door. i would particularly endorse the last recommendation in the

report that we should broker confidence-building measures between pakistan and india. i think the benefits for the u.s.-pakistan relationship and benefits for the region as a whole would be enormous. >> how you get over the zero some elements of the view that a closer u.s. relationship with india is seen as a threat in islamabad and vice versa? >> because you have to start somewhere. the late richard holbrooke was eloquent when he would talk to leaders about this. you have to start with some of the smaller [unintelligible] there are a number of issues, the economic perspective and

prospects for the region are simply enormous. the business community in pakistan is a bright spot. they should engage more actively on that. it will take a lot of work. >> let's bring afghanistan into this. reconciliation between the taliban and afghan government has taken on new urgency since the death of bin laden. the administration has accelerated some of its direct talks with the taliban. there have been at least three meetings between afghan government officials and a taliban official close to mullah omar. it seems like the pact will have to go through islamabad. how can the u.s. bring the pakistanis on board with the peace process when significant elements still see extremist

groups in afghanistan as part of their nation's strategic that with regard to india? what role should other nations play in this process? >> that is a fundamental question. i spent a week in pakistan in january and interacted with senior military intelligence and governmental figures and went out to the tribal areas a little bit. i think one of the most important things the u.s. needs to do as soon as possible, and in president obama's speech next month there may be an opportunity for this, dispel some of the uncertainty about the future u.s. role in the

region. one of the great tragedies in the last two years in terms of understanding what the u.s. is planning to do was perhaps the misinterpreted one liner from president obama's west point speech that troops would begin withdrawing in 2011. the message in the region was, the americans are leaving, they are moving for the exit. everyone there is preloaded to expect that outcome anyway because that is what history has told them. we have still been very opaque about our long-term goals in the region. one thing we argued in this report is that the u.s. needs a long-term small military presence in this part of the world. that stands -- that sends an unmistakable message that we will remain committed.

the pakistanis are hedging their bets. history has told them they need to make sure that our best posture for the day after the americans are gone, because that is going to come at some point in time. they will always be neighbors of afghanistan and india and have to hedge against the prospect of us no longer being a player in that region. we need to dispel the notion that we do have an endgame that is departing the region wholesale. the other regional players are ambivalent on this. the lack of certainty from the u.s. causes them to have hedging plans that work around our interest. that is the most important thing. >> environment work troop levels will be heading down starting in july, how big of a u.s. presence does their need to be post 2014? what is the strategic framework

currently being negotiated? it needs to to create the necessary incentive to get various taliban actors as well as the pakistani government to see that a u.s. presence is significant and enduring enough? what does that level have to be? >> we argued that the number should be somewhere between 25,000 and 35,000 americans. they will have to continue to fight the terrorist battle against al qaeda. you would need some special operations capability to do that. it could be a smaller u.s. force. to have zero american troops is

not the right answer. the afghan government actually wants americans to remain in afghanistan. they are concerned about the impact if the u.s. doesn't leave. they very much want to state -- stay connected to some form of u.s. military presence. this is not about the island of afghanistan. it is about the region. the u.s. has long term vital, national security interests that require at least a small u.s. military presence to protect those. it is important to get that out there and negotiate some type of agreement with afghanistan to be able to do that. in my view that will have a calming effect on the region in general. >> there are some very tough to swallow statistics.

almost 1500 americans have died in afghanistan since the start of the war. the price tag this year that will exceed $113 billion, and plans to spend more than $100 billion next year on our presence in afghanistan. this has many people searching for a more sustainable mission with less cost. useppa we need to cut back on the unsuccessful mission the population protection and democratic nation building and be more focused on special operations and advising afghan security forces. you are skeptical of the process of a peace deal with the taliban. how do we get to that without seeing a hard-fought gains erode? let's be honest, for all the talk about a civilian search, there have not been that many civilians sent down to the district level in afghanistan. if the military is not doing it,

who is? if nobody is, if our soldiers are just focused on killing the bad guys, what keeps the country from slipping back into the old cycle that helped fuel the conflict in the first place? >> i like the fact that this conference is called risk- reward. when you are a country -- you have to consider risk vs. reward. the reason we tried nation- building in afghanistan was because of our hubris on one hand and because we thought we were so rich we could do anything. we spent 10 years with ninth century tribes on a bunch of rocks, trying to say a social contract is the way we will do business as a military. our u.s. military, years ago said they had a new doctrine. they said from now on, soldiers

and marines have to be nation builders as well as warriors. i think that is nuts. but we succeeded in doing in afghanistan, we have created a culture of entitlement. the general was saying that every one of our commanders has to balance what they do for governments with security. why does he have to do that? we have driven the afghans to expect, when you look at an american, you see a $. when we have $1.50 billion of what we call emergency response programs, that means every battalion commander is walking around with millions of dollars he has to spend. so we have trained just like lyndon johnson believed we could have a war on poverty and a great society and cause chaos by doing so, we have done the same

with the afghans. we have said we will do everything for you. the general was proposing that he has a plan for the next 3.5 years. 3.5 more years at $100 billion a year. can we do all that? sure, we can. the issue becomes a risk-reward. do we want to do that or are there other strategies? i think you will see an interesting month when the president travels with this reverses the amount of money we have a versus what we are spending. the alternative is quite clear. we go to a very heavy adviser force, which has been recommended. the taliban are not that great a threat. the idea we are trying to keep them from taking over the country, fine.

how do they take over the country? how did they do it in the mid- 1990's? they had a lot of help from pakistan in terms of logistics. to go into a big city, you do not do it on a few motorcycles. once you start moving, you have to mass. someone has to provide you with many vehicles and a logistic system. i guarantee you, the pakistanis are not going to do that. they are doing us a great favor because the arms that the taliban have our nickel-and- dimed. they do not have anything that is serious in the way of armament. i am convinced that is because the pakistanis have clamped down so they do not get them. we have 60 blimps now over our outpost, tethered there, watching the area 24 hours a day. not one of them can be touched

by any taliban because they do not have the logistics base. the other thing we have is remarkable aerial surveillance that i never believed that i would see in my lifetime. every patrol you are out with, there is somebody up there watching. we cannot then out our ranks dramatically and leave behind some people who are the advisor that have this kind of equipment, and let the afghans do their own fighting and their own civil war. are you taking more risk than us doing everything for them for the next report five years? yes, you are taking a risk. but i think that the state of our own economy, and having more and down our forests and the steady casualty's we take, i would argue for taking this risk and not going with us in the forefront for another 3.5 years of this war. i do not think the taliban would

end up in patrol in afghanistan, but it is a risk you are going to have to take. >> how messy can afghanistan get without it fundamentally compromising un -- u.s. national corp. interest? the in state is defined as [unintelligible] you heard a vision described by lieutenant general rodriguez that has also been embraced by ambassador eikenberry and others in u.s. government that calls for very active efforts down at the sub-national level for a delivery program, but getting

ministry represented down to district levels, what should that level of involvement be going forward, and how messy can we tolerate this? how messy can get while ensuring that al qaeda does not come back and that it does not destabilize pakistan? >> we were pushed out of some areas. can you have a mess and still continue on? yes. our issue should have been, do we want transnational terrorist to can strike from afghanistan

against other countries? i do not believe that will occur. i think you can have an absolute mess in the countryside. yemen is a mess. pakistan is a mess. let them kill each other forever, as far as i am concerned, as long as they are not killing us. i would restrict the mission to -- are you telling me there is a threat such as used to exist when mullah omar was living there and planning things? i would leave the rest of it being a mess. >> if and if you go down to where there are 20,000 u.s. forces, if the cost of doing business in afghanistan is greater than the pontotoc, they will not seek to come back in significant numbers -- greater

than the fatah. >> let me register my disagreements with some of what bing said. the size of american investments, the amount of money we have spent has had a distorting effect on every aspect of the afghan political economy. should be our goal to reduce the size of our presence in troops and the distorting effect we have on the political economy, but to do it in a responsible way. it would be unwise to have a policy goal of inducing a civil war. afghans deserve better than that from us and so do all the men and women who have sacrificed from the u.s. military today. we are in a transition. it should be our goal is to

manage that transition successfully. i think there are specific answers to your question. irregardless of whether we are successful in preventing a medium grade civil war or a large great civil war in afghanistan during this transition, what residual capacities would line up with u.s. interests? one is the capacity to carry out counter-terrorism actions against international terrorists, including the raids such as the one carried out against osama bin laden. a little more in direct, but easy for us to agree on,

something i hope the pakistan army increasingly is thinking about in managing its own place in the next transition. if afghanistan were to become a sanctuary for anti-pakistani islamic revolutionaries, that accelerated the potential of the pakistani taliban to metastasize into a force that threaten the pakistani state, that would be disastrous for the united states because of the strategic assets that the pakistanis whole. part of the problem is, you can imagine uncontested it rural territory in afghanistan becoming such a sanctuary even if the afghan government supported by the international community held on to cities that we used to visit in certain

areas. >> let me make a couple points. i disagree with mr. west. in 3.5 years in pakistan, i saw many threats less against us and our allies. there is no reason to believe that with messiness of varying degrees that that would not move right back into afghanistan. that would be the first issue. the second issue is the one that steep points out, that this would be inherently destabilizing. there is a misconception that want the taliban back in power. nothing could be further from the truth. these cross border raids are a two-way street.

they do not want to rely on india, either, so the have a very conflicted approach to afghanistan. if they seek a degree of messages or lack of american commitment in afghanistan, i think the pakistanis will hedge their bets to possibly a paralyzing extent. there are a lot of things that could go wrong with pakistan from a messy situation in afghanistan, given the strategic interest we have and pakistan. i think it would be a very high risk to run. >> is there a middle ground in terms of the afghan ends the state that is not total this engagement? is there something more sustainable than the scope of the effort that is being deployed in significant parts of the country right now?

>> that is going to be the challenge over the next 3.5 years, design and structure to get you to and afghanistan that is stable. each of the panelists have noted this in one way or another. afghanistan is the keystone to regional stability. it is the only place where we have two nuclear-armed countries facing off against each other. this is an extraordinarily dangerous part of the world. we are going to have to find a way in the next 3.5 years to take our aid and bring it down without collapsing the afghan economy in helping to design something that gets to a steady

state afghanistan that is stable. i hope it is seasoned by a small american military presence with a long-term commitment. i think that is achievable, but i am not sure we have crystallized the realization that we have to start designing for that outcome yet. >> as long as we do it for them, they are not going to do it for themselves. we could go for another three boys five years the way we are doing in iran. until we see the afghans fighting the afghans, standing up for themselves, we are just pushing back the tide. it is just a question of when that transition will start. i would just like to see it start earlier. i would define it as a civil war right now going on in pakistan and afghanistan. all those things are going to go on for the next 20 or 30 years.

>> i was having coffee yesterday with a state department representative who is back on home leave. he has been there for almost 20 months. he was noting that they are now in a position, after about three years of u.s. bulls' practice insurgency operations that began in the summer of 2008. they are getting more police now than they can take, but it has taken three years. he thinks it will take many more months of a continued international presence there. how do you bring that about in a world where the troop levels are going to be coming down? you want to continue on a path of reinforcing this stability, but in most of these areas where you have started to see some

positive developments, they all still seem to be fragile and reversible. it seems hard to imagine that you will be in a world at the end of this year where that commanders are going to be able to take significant numbers of troops from the south and move them to the east to deal with the very real issues taking place there. how do you square that? >> it is time to get the afghans deeper into this fight and get them in front with american advisers. you have an enormously large afghan security force that has been built over the last two years. they are an effective force by regional standards. one of my allied counterparts

said it is in their dna to be warriors. i have heard from a number of friends in the region that the afghans are ready to do more than they are doing. >> let's open it up to you guys. i will ask you to keep your questions short and you can address it to a specific member of the panel or to the panel as a whole. >> ambassador patterson, you are involved in what is probably the most successful counter insurgency effort down in colombia. there we have done it with no more than 800 guys on the ground and probably spent a total of about what one month costs in afghanistan. can you comment on the

similarities or differences and what we might learn from that? >> we had a more longstanding relationship with the colombians over many decades. one of the key differences is the engagement we had in pakistan. there has been a lost generation of military officers that had no contact with the united states and we will be paying that price for years to come. it is an entirely different kind of conflict. it was not filled by this religious veneer. in many cases in pakistan, it is a veneer. pakistan -- colombia was a country that had institutions that had been controlled by it civilians for decades and did not have the demographic and social problems that pakistan confront. it was an easier environment in

which to make progress. >> every time 2014 is mentioned in regard u.s. withdrawal, we all have forgotten there is a presidential election that year. how will nato ending a mission there affect the ability to ensure a fair and credible election? for those in favor of continued military presence, how will that not be a casualty to afghan politics? >> having been there for the first afghan political election in 2004, which was the best of the two we have had so far, the

constitution in afghanistan right now prevents the president from running for a third term. president karzai was first the interim president and then served a five-year term. there are indications he wants to serve a third five-year term. ambassador crocker is going to have to be involved in ensuring there is the prospect of a constitutional succession in afghanistan that starts in 2014. how emerging leaders come to the fore in a political environment where there are no political parties makes that very problematic. i do not think the nato transition that is scheduled to conclude at the end of 2014 in furs there will not be a military presence after that.

i don't think we should view it as a in in that game, full withdrawal. one of the key tasks that needs to occur before the transition is to help set conditions for successful presidential election in 2014. we have utterly failed to do that in the last presidential election. i hope we will not make that mistake again. >> it is a good question because the political side of the transition that is ahead, no matter what the evolution of a military strategy, is going to be vulnerable to capture by president karzai or his advisers. there is going to be a lot of

pressure to stand firm of around the principle that there should be a constitutional election. the embassy's in kabul did a great job of standing up to president karzai as efforts to keep parliament from being seated. i am not sure if anyone was paying much attention to that kind of struggle. it is often easier to stay with the incumbent and to take the hard risk of building a more sustainable afghan politics. there are enormously diverse numbers of credible afghan leaders who want to participate in peaceful, constructive politics. it ought to be a high priority in the transition to give them

the space to represent their communities. >> you made a comment that if we leave afghanistan or began troop withdrawals, that perhaps we may have the adverse effect of destabilizing pakistan. anymore than we are already doing now with the drone strikes? this month, a pakistan think tank released a report that there are 600 known al qaeda militants being released back into the population because they do not have the proper governance to keep them there. if you could help me understand some of that. >> generally speaking, -- our

first responsibility is protecting the united states. i think our intelligence programs have been enormously successful in that respect. i think the question was about the degree of messiness in afghanistan. the problem with pakistan is that they are going to hedge their bets until they have a better idea of what is going to happen in afghanistan. so the situation becomes a little more unstable every day in pakistan. that is the scary thing, the long-term prospects are frightening. what we have seen dramatically in the past 3.5 years is the scenario that steve outlined, which is a group coming together.

the attack in pakistan in late in 2009 -- until pakistani leaders have a better perspective, have more confidence in what is going to happen in afghanistan, i do not think they are going to take the steps the country needs to stabilize their own situation. >> when i was there in january, one of the things that surprised me was the degree of fear among the elite about the stability of the country. a leading beer was the economic sphere that our economy was going to get to the point of collapse. that is something the u.s. has to look at and do more than we have been doing there. somewhere down on the list was internal instability and extremism. about a fourth place was india, which was striking compared to

previous visits out there. there is internal recognition that have some very serious problems. i applaud the administration, and congress is moving in this direction as well, is to reinforce programs aimed at the civilian government of pakistan. the report suggests that the u.s. needs to continue to bolster those programs and make sure that money gets spent appropriately. it needs to be more transparent and accountable. >> with regard to pakistan and al qaeda, one of the most interesting things going on at the moment is this trial going on in chicago. the terrorist group responsible for the mumbai attack that

killed 166 people, they provided financial, military, and moral support. to what degree should -- are we taking a hard enough line against them? do we lose any degree of leverage over the other affiliated groups that are out there causing significant trouble? >> discusses complicated. it has been fragmenting over the last years in order to hold on it to its position as a ward of the pakistani state.

it is a complicated organization with a great degree of religious proselytizing and social work blended in with violent wings. there has been a pattern in which the number volunteers and more violent ones have been going out to participate in the al qaeda affiliated violence. some of it has expressed itself as international ambitions. it seems to serve as a partial proxy of those elements that want to weaken india. the question is, how far up the chain of command is the knowledge and planning of that attack?

they have had that question about a whole series of spectacular attacks. they cannot hold a state accountable for that activity. one reason like india and pakistan relations are frozen right now across the region, including in afghanistan is because the pakistani state is not accountable for what the indians regard as a pretty convincing body of evidence that they would like to see it carried through. these are serious problems. same true with us with the fact that there had to be some sort of collusion for a summit to be there, and many

other people who are in al qaeda -- for osama to be there? >> the organization was clearly set up by the pakistani intelligence agencies to engage in warfare against india. this has happened repeatedly with other groups since died of pakistan. they do not exercise in -- inside of pakistan. these groups are working with each other to threaten the pakistani state now. i do not think they are entirely in control. i think they still have contacts and the same is true with other groups. some have been out there for decades and are now more

radicalized by domestic events. >> we are seeing in these groups in some cases taking on trends national objectives which we have not seen until the last two or three years. it makes it a more complex problem than just al qaeda u version 1.0. we have to be cognizant of the threat of these other groups that are outside of the al qaeda logo that are becoming as dangerous to the nine states as al qaeda was in the past. that number appears to be growing, which is troubling. >> what shall we do with india to get them to help in afghanistan? is there anything we should be

doing with india to get them to pull back a little bit too diffuse concerns in islamabad? another question from twitter has to do with afghanistan. >> [unintelligible] >> it is a very good question. pakistan is incredibly sensitive about indian activity inside of pakistan. i think india has been very

helpful to the state of afghanistan and has done a considerable amount of nation building over the last 10 years, especially in the road network. the afghan and indian government have very good relationships. the u.s. just needs to maintain a quiet dialogue about its activities there. as we get into up phase of negotiating with the taliban and talking to pakistan about how to resolve this conflict, we have to keep the dialogue going quietly with india as well. >> [unintelligible] india has to be part of the solution. it is part of the regional context in which the war has been going on for 35 years.

very strong relations exist between president karzai and the indian government. they are probably stronger than u.s. relations in kabul in some respects. the indians can help construct the political transition we were talking about earlier. the pakistanis fears of the indian presence are not completely unjustified. in funding separatism and so forth, it is overdrawn. there are problems of international support for anti- pakistani groups that operate sometimes in sanctuary elsewhere, including in afghanistan. they are not of the scale to justify the paranoia and the arguments and that the pakistanis bring to bear.

>> the indians see a potential alternate route that connects the arabian sea to central asia. the washington view on iran is such that dealing with them at more than arm's length -- could they be brought in in a more constructive way to provide any sort of leverage for the pakistanis, or with regard to the afghans? >> as the u.s. talks to the afghan government about a long term, small u.s. troop footprint there, the u.s. needs to do that

with a view towards the sensitivities iran is going to have towards any americans in afghanistan at all, and surly in the western part of afghanistan. -- certainly in the western part of afghanistan. all of the trade that generates the economy comes from iran. they are closer in many ways to iran than they are to cobble -- kabul. the final point would be that one of the things we recommend and our report is that the u.s. work to open up trade and transit all across the region. the route you just described is an example of a success story there that the u.s. is very ambivalent about because it involves iran, who we have a mixed relationship with. that is an area where we can quietly do work to open up those

ties and use india's relations with iran while we figure out what the end at stake in afghanistan is going to look like. >> i agree with everything steve said about india's role in afghanistan. i think we have not talked enough about the way through this. it is ultimately a political settlement. everyone has been saying the only solution in afghanistan is some kind of political settlement. the other players will have to be brought in at some points. >> will take one last question. >> with respect to eastern

afghanistan and the militant groups that operate there in relation with al qaeda, how critical to the overall mission is it that the u.s. and coalition it out to these troops in the east? if we do not, what are the consequences in terms of president obama's objective stated specifically with respect to al qaeda? >> in terms of geography, they are just all mountains. if it is amount on the pakistani side or the afghan side, it is just another mountain. on the general starts, and noted he has no intent of going back up into those areas. they are up at 10,000 the, and

that is where they are -- they are up at 10,000 feet. we are fighting a war, a big war, and has to do with how big is the guy you are fighting against. in terms over war fighting versus anti-terrorist body, i do not see the taliban are any of the others receiving the kinds of materials to make them a material danger. they can be a pain in net -- a pain in the neck, but getting the momentum as far as raw materials, i do not see them getting that. that is separate from them remaining as terrorists. >> i don't think the connection you suggest between al qaeda and other networks is the primary

driver there. particularly in eastern afghanistan. the hakkani network is probably the most dangerous insurgent group the u.s. is dealing with. they will require pressure from inside pakistan to neutralize its capabilities more so than fighting in eastern afghanistan. i am moderately optimistic that in the next six months we will see some action but against that network. >> i would like to thank the panel for their fascinating remarks here. thank you very much for joining us today. [applause]

i am told that box lunches are served outside. please be back here at 2:15. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> today, u.s. defense secretary robert gates made an appearance in southern afghanistan to say goodbye to american troops. he stressed the need to afghan president hamid karzai that his government and security forces must that up and take more responsibility for defending their own territory if the withdrawal of u.s. forces is to be successful. he also said there could be peace talks with the taliban within a year.

monday, live on c-span3, lieutenant general william caldwell on training afghans. >> i want to express my deep appreciation to each and everyone of you for coming forward today and you are

prepared testimony. we are dealing with the realities of congress right now and the votes scheduled, so we will do our best to try to get in as much as we can in the former direct testimony. ideally, we will be able to see what it takes with regard to what should be a quick vote procession and then we will return. hopefully we can so i would like to welcome today's witnesses to discuss the future of the dhs intelligence enterprise. before we begin today, i would like to take a moment to send my heartfelt condolences to one of our subcommittee members. i know he is here today. i do not know if he is going to be able to make the hearing. bill long from missouri. representative longer represents joplin, missouri, and i know many of you who deal with

homeland security are very well aware of the devastation by that tornado last week. i know i speak for all members of the subcommittee when i say our thoughts and prayers are with billy and the people in his district and the great people throughout joplin in this difficult time. as we all know, the department was created in response to the 9/11 attacks and consisted in the merging of different agencies. there has been great progress in solidify our homeland, but more work remains. our personal experiences. this more united states attorney for the eastern district just days after 9/11, working on a variety of issues during my time in office. with four terrorist attacks against our homeland since 9/11, and dozens indicted, the threat to our homeland remains at all-

time high and is more diverse than ever, even with the death of osama bin laden. we continue to face serious threats from terrorist groups though are attempting to point foreigners can americans to conduct attacks. in addition, we face a severe than threat from radicalize individuals within the united states, including u.s. citizens who have lived here their entire lives and yet are still drawn to the ideology and conduct attacks. most notably, that includes the times square bomber and another. thisday's 112 congress, subcommittee has been threat focused. members have learned about the terrorist threat from yemen, pakistan, and counter-terrorism ramifications in the middle east and north africa.

both myself and another know the challenge facing aviation security. it as a responsible for assuring individuals remain in the country illegally are apprehensive, and because car is tasked with protecting ports and other critical infrastructure, including in my own area, the delaware river in my district. the boots on the ground rely heavily on intelligence to help them do their jobs, which

includes identify suspicious and vigils to trucking hundreds of thousands of shipping containers around the world. assuring a robust system of information sharing and analytic excellence across the department intelligence enterprise is critical. the dhs intelligence and a prize has developed and changed dramatically over the years, and we're here to hear where we should be going. my hope is that this will be an in-depth conversations with members leave with an understanding of the positive developments, of which there have been many, and a sense of the challenges which still remain. the information is being shared and used to create first homeland security intelligence, a first-rate homeland security

intelligence projects. and just on a last note, secretary wagoner, i know you are aware that i sent a letter to secretary nicole itano and general -- and another. i want to make sure this gets to the states and local among the set -- frontlines of dhs. ivan forward to receiving a written response to that letter, but please let me know how we can help in any way to move forward on this important issue. i look forward to hearing from today's witnesses. i would like to know recognize the gentlewoman from california for a statement she may have. >> thank you for holding this meeting today. i look forward to continue the

long history of oversight over the critical missions. this enterprise brings together the intelligence capabilities of the entire department, from the headquarters to the office of intelligence and analysis to analysts on the field working on various components. we are here to examine the progress made since its creation and to identify areas needing improvement. although we have, long way to shore up intelligence gaps, several incidents over the past few years have revealed a vulnerability. there is the importance of maturing intelligence enterprise. does dhs have the funding it needs to continue building its architecture?

i am pleased that the undersecretary is here today to discuss how enterprise is maturing. some challenges faced appear deceptively simple, like developing a lexicon for all to use department wide. once you do that, please share that with us, because i as one candidate to be challenged by many of the acronyms. other challenges seem more complex, like bringing to better competing priorities to serve the large customer base. how are we reducing redundancy and other agents? how much money should we be devoting to this, and can it be deep -- be done better and more efficiently?

this has underscored how critically important in this. . and we know that al qaeda was looking at our rail, aviation, and energy sectors. do we have the right policies in place while protecting be civil liberties of u.s. do we have the right technology to allow components to communicate with and their components within the dhs and within the intelligence community as well as state, love wrote -- local, and private partners? after this hearing, we expect to have a much better picture of the accomplishments and more

importantly, how we can help you address your critical needs and meet your goals in the future. i would like to thank all of the witnesses for being here today. although many of your accomplishments are designed to go unnoticed, know that we appreciate your tireless efforts to keep america secure. i yield back. >> i think you, and other -- i think you, and other members -- i thank you, and other members of the committee are reminded that opening statements may be submitted for the record. we are pleased to have five distinguished people before us on this important topic, so let me remind the witnesses that their entire written statement will appear in the record, and i hope that you will allow us to understand the most critical parts of your testimony and do your best to try to work with us on the time deadlines, as well. there is the undersecretary and chief intelligence officer from the department of homeland

security office of intelligence and analysis. the undersecretary -- i disney to make sure. -- i just need to make sure. she was confirmed in her present post by the senate in february 2010. before that, she led a storied and accomplished career, including as electronic warfare officer in the united states army and later as part of a select committee on intelligence dot the defense intelligence agency and the director of national intelligence. undersecretary wagner also wanted bachelor of arts degree from the college of william and mary and another degree from the university of southern california. secretary, you are now recognized to summarize your testimony.

>> thank you mr. chairman. co-chairman, ranking member, and distinguished members of the committee, i am honored to appear before you today to discuss the dhs intelligent enterprise in the company of some of my colleagues. i view this hearing as a valuable opportunity for us all to update you on how we increasingly work with a partnership to provide support to the department, the intelligence community, and are many and very external customers. i want to start with a few definitions, because this can get confusing, and the dhs intelligent enterprise consists of all elements of the department better engaged in directing, collecting, processing, analyzing, and disseminating intelligence information petricca in support of the tournament's many missions as outlined in the

department of homeland security review. the council is basically the board of directors of the intelligent enterprise, and is comprised of the heads and other key members of the intel its enterprise, such as the program director, which is responsible for infrastructure protection and cybersecurity. my role was created in 2005 and formalized in legislation in implementing recommendations from the 9/11 commission act of 2011. as chair, i am responsible for overseeing the intelligent enterprise and performing a few key functions. first, reviewing the budget to ensure that they are adequate. and advocating for needs within the larger department bill. secondly, they would benefit from standardized policies, practices, and procedures, and working with the members to

prevent -- to implement them. i am more he on crafting unresponsive and the input to the secretary for the allocation plan. i have the opportunity to weigh in as part of the budget bill, and as you know, these two portfolios are closely related. in the fiscal year, i put an initiative in there to provide additional personnel for u.s. citizenship and services, and a

member who is not with us today, to assist them with reviewing the voluminous holdings in response to a growing number of aquarius. we developed a phased approach while assuring all policies. improving production across the board is important, it is these are a primary method for getting the information that we gather in the course of performing many missions to our partners in the law enforcement and intelligence community. you may hear more about them

reporting, because ice is a best practice in terms of reporting. we have created a task group. in some cases, these of the first ever in their opponents -- components. another area where we are developing something is in production management. is, in fact, hard to have too much duplication, because the missions and the various components are very distinct.

we have produced are first analysis in 2010, which laid out the key plants, and they had response. the first one is to be a true document, developed completely. finally, a couple of examples on collaborative focus on intelligence issues. without going into details, we could teams together to focus on things like apprehension of specific groups along the border arriving without documentation to try to figure out why and how they arrived at the border. we have a very successful working group that focused on capabilities and gaps and discovering tunnels under the southwest border.

we also put together a team in cooperation with our enter agency partners as a way of ensuring that we and our state and local partners had the most protective measures. the hsic and dhs work together and are getting better at working together. we take it to the next level and work closely with our interagency parties. finally, if you forgive my analogy, homeland security is a team sport and i am proud to be here with my teammates to answer your questions. >> thank you, undersecretary wagner, for your testimony. our next witness is rear admiral thomas aken of the united states coastguard.

he has held the post of acting assistant commandant for marine safety, security, and stewardship. as an admiral in the coast guard, he served as special assistant to the president and senior director for better security on the national security staff. he was first commander of the coast guard deployable operations group. following a number of operations. he is a graduate of the united states coast guard academy with aged bachelor of science degree in mathematical -- with a bachelor of science degree in mathematical sciences. i also understand you may have a little interest in how the coast guard lacrosse program is doing this year. you are recognized to summarize your testimony for five minutes. >> good afternoon, chairman. thank you for the opportunity to provide testimony of the coast guard intelligent

enterprise and how we were closely with the vhs homeland security intelligence council partners. i am we admiral thomas atkin. in the, dodd for criminal investigation and intelligence. -- i am the assistant commandant for intelligence and criminal investigation. no other department has a jurisdiction likes our coast guard which allows us to test the maritime domain in every manner. we protect those on the sea, we protect america, and we protect the sea itself. the coast guard's persistence presence allows us to fill a unique in each within the intelligence committee. as a member of the armed forces, we are at the

intersection between homeland security and national defence. as a federal law enforcement agency, because god is also positioned between these two import -- the coast guard is also a position between these two important groups. we collect and report intelligence that not only supports our mission, but supports the national security objectives. in august 2010, eight 180 foot carrier crossed the pacific with a sri lankan migrants. the coast guard enabled tactical commanders to closely monitor the case, prepare contingency plans, and position response forces.

this vessel was of particular concern because the smugglers include members of the -- of a terrorist group. we monitor the vessel, especially as it approached u.s. territory. we leveraged our capabilities with our law enforcement counterparts. we may boarding team is aware of the positions and the responses they might encounter. we assessed the potential threat posed by the crew and passengers. at any time, this could have turned into a major search and rescue case where a significant interdiction is dead. the vessel was intercepted by the canadian forces. we provided effective, timely, and usable intelligence to make sure we were ready to take action. this example highlights our maritime expertise and allows us to leave our law enforcement to identify potential threats and to work towards a positive solution to protect our nation. the coast guard screens ships, crews, and passengers. in 2010, we screened more than 21 to 57,000 -- 257,000 ships. we use real-time data base checks that allow us to identify suspected entities. our collaboration has been so successful that earlier this

year we moved much of our screening effort to the national targeting center to better integrate our agents with personnel performing their duties. any info on persons found with possible terrorist links are shared with the department of justice and the intelligence community.

i have only scratched the surface describing the broad capabilities endeavors relationships that define the coast guard intelligence enterprise. our experiences result from our unique status is with law- enforcement agencies, a federal regulator, and the national intelligence committee member. our enterprise bring something different to the table. we have made great strides in our collaboration under the leadership of secretary wagner. we understand that we are strongest when standing together. we are working to make significant progress and align our capabilities with the strongest purpose. thank you for inviting me here to discuss the coast guard intelligence enterprise.

dhs and the scic -- hsic. i look forward to your questions. >> process, rather admiral, for your testimony. our next witness is mr. daniel johnson. mr. johnson began as an assistant administrator for intelligence earlier this year. prior to that, he served in the united states air force. with 26 years' experience at the air force intelligence, surveillance, and recalls its -- and recognizance efforts, he is a seasoned staff officer. he also worked at the pentagon on the joint chiefs of staff as deputy director for joint requirements. that must be quite a business card when you have something like that. in that role, he provided intelligence support to the chairman of the joint chiefs of staff as secretary of defense. mr. johnson graduated from the air war college at maxwell air

force base in alabama. he received a master of public administration from the university of oklahoma, a bachelor's degree in public administration from eastern connecticut state university. mr. johnson, you're recognized to summarize your testimony. thank you. chairman, thank you for allowing me to testify today. since coming on board this january i have had the opportunity to work closely with undersecretary wagner and my colleagues at the united states coastguard, immigration and customs enforcement. improving our internal and external collaboration in information sharing. as the assistant administrator for intelligence for the gsa, i oversee three primary missions.

in the case with a warning, predictive analysis, and response. the gsa office of intelligence can receive, assessed, and disseminate intelligence information for transportation security purposes that helps protect the 1.7 million passengers per day the u.s. civil aviation, the 47,000 miles of highway, the 147 million maritime passengers per year, the 29 million passengers per day to use mass transit, the 1.6 million tons per year travel by freight rail, and the over 2.5 million miles of natural gas and liquid pipeline. in my role, i am often asked what keeps me up at night. the answer is a global threat with a regional focus coming primarily from al qaeda and its affiliate groups. they are a threat to transportation security. they continue to threaten u.s. interests abroad.

in particular, a group that is fixated on aviation as a means to inspire fear and economically cripple the united states western efforts -- western answers. we rappers the october 2010 cargo blocked -- cargo block. in light of the successful assault bin laden roll out, we continue to track and monitor existing gestation threats from al qaeda. -- existing transportation threats from al qaeda. stakeholders include the passengers out there today, fuel operations, a key infrastructure operators. in order to do this, we must work clothes with the haleh security council -- must work closely with the homeland security council. of the past six months i have reached out to be intelligence and law-enforcement communities. along with reaching out

externally and leveraging existing analysis being done by partners, the government coordination councils, fusion centers, private trade associations, and national joint terrorism task forces. under the leadership of undersecretary wagner, we have worked closely with vhs in professional development and training. within my office we have created a development at that ranges from new hires to seasons analyst. on the ground floor, we're beefing up our intelligence section. we work closely with dhs on policies and procedures.

within tsa, -- thank you for this opportunity to address the subcommittee. i am happy to answer any questions. >> thank you, mr. johnson. i am grateful for your testimony. our next witness is the assistant director of intelligence for the united states intelligence and customs enforcement. his public service includes 20 years experience, most recently as deputy undersecretary for operations in the office of intelligence and analysis.

he has also served as the director for human smuggling and trafficking center. special agent in charge of the field office. before that time, he worked with the immigration and naturalization service as deputy assistant commissioner for investigations, director of anti smuggling, and assistant director for investigations and special agents. he also holds a bachelor's degree in political science from california state university at long beach. you are now recognized to summarize your testimony. thank you. >> thank you, mr. chairman. distinguished members of the subcommittee, on behalf of secretary napolitano i would like to thank you for the opportunity to discuss efforts in support of the dhs intelligence enterprise. i offer a unique perspective but because i have had the honor of serving in a leadership role in both i.n.a. and i.c.e. we do this to intelligence

production and that through law enforcement investigations focusing on terrorism, human smuggling, humans factoring, financial crime, weapons proliferation, drug-smuggling, and other activities. we had the most extensive investigative authority. we a people assigned in over 200 u.s. cities and in 48 countries around the world. ice is a vital contributor to the intelligence enterprise and a voracious consumer of its products and services. the ice intelligence program is structured along three major lines. we have field based intelligence teams that support our field

offices directly. we also have intelligence liaisons' which we have placed with enter agency partners in the intelligence community. this combined approach allows us to have people who will help serve and make sure we have the right information going to be right people at the right time. in your opening statement, undersecretary wagner provided an extensive overview. i would like to focus on how collaboration within the enterprise is projecting from ours perspective. the homeland security council, as previously mentioned, stars as an excellent venue to coordinate on a large, strategic initiatives as well as making sure we are working on common threats. for example, ice has advanced important initiatives in the

coordination of counter-tunnel investigations and operations. we'll work our collaborative capabilities to determine and identify illicit smuggling pathways, bringing people and goods into the u.s. illegally. ice facilitates a bi-directional and vote flow between our external partners, both domestic and overseas. is plays a critical role in support of the national intelligence committee as well. ice is the leading producer of homeland security reports, which provide valuable intelligence reporting from ice operations. we disseminate those externally to our partners. in the year 2011, ice as accounted for 58% of the department's production of h.i.r.s their value by customers as high value or major

significance. they are substantial in the intelligence world. the successful of our reporting is a commitment not only to the people producing them, but also a commitment to show that ice is committed to making sure we are putting out our most valuable information so others can use it to strengthen national security efforts. ice also has a leadership role in the e.t.t.f. this is an inner agency entity that sits in the office of intelligence analysis that work to ensure that dhs leadership maintains situational awareness on rapidly evolving terrorist threats. we do this through the enabling of counter-terrorism threat coordination and by producing

sensitive intelligence assessments. is's a participation also helps our needs. we are able to glean information held by other intelligence components and share that with our special agents on the ground to or working around the country to combat terrorist threats. ice also plays an important role in the information sharing with our federal, state, local, and international law enforcement orders. we do this primarily to the law-enforcement information sharing initiative. since its inception, we have entered into eight law- enforcement information sharing agreements on behalf of the department of homeland security. this is an agreement recently signed with the international justice and public safety network. this is an important point. this will enable us to share

information with 785,000 law enforcement officers around the country. this is something i am very proud of. this will help the boots on the ground in the state and local community. the importance of integrating intelligence into our investigations and operations cannot be overstated. since 2006, dhs has leveraged task forces which combined federal, state, tribal, and local law enforcement intelligence and law enforcement resources to synchronize efforts to combat existing threats. ice intelligence provides strategic and operational support. we are working with i.n.a. to increase overall support on the borders. ice serves an important role in

coordinating intelligence functions. we serve as the primary conduit for the d.h.s. intelligence from ice. in a rapidly changing environment, however, we cannot be complicit with our successes. we are moving forward by increasing our strategic intelligence. >> mr. chaparro, i am very focused on your testimony. i appreciate it. i would ask you to sum it up very quickly. we need to get to miss mitchell. we would do our votes and get back as quickly as we can. can you give us your concluding >> if we take great advantage of the services provided by our partners. we utilize information.

i look forward to answering any questions the committee members may have for me. >> thank you. we would like to identify our final witness, mrs. susan mitchell, the deputy assistant commissioner for the opposite intelligence. i hope you will allow me to -- allow me the privilege of not sharing the same introduction as i did before. let's get right to your testimony. >> good afternoon, chairman. it is a privilege and honor to appear before you with my colleagues and to discuss c.b.t. intelligence efforts and evolution. with all the 60,000 employees, cbp is the largest employer -- enforcement operation in the nation.

we protect the united states from terrorists, drug smugglers, agricultural disease, among other threats all while fostering our economic security and competitiveness. cbp provides a layered defense along 7,000 miles of land border and 95,000 miles of shoreline in partnership with the u.s. coast guard. we protect and deterred the -- detect and deter the movement of foreign terrorists. i would give you two examples of our efforts on this much -- on this front. cbp officers prevented the entry into the united states the so-called "millennium bomber." there were transforming explosive materials. it was identified by a behavioral analysis detection and the vehicle he was driving. more recently, on may 3, 2010, cbt worked with jfk airport to

-- cbp worked wiht jf -- with jfk airport to apprehend the times square bomber as he was attempting to flee the u.s. on a flight to the middle east. much earlier, and it really is the key, he changed drastically from his normal means of traveling with his family versus the documents detailing this trip -- which traveling alone and failing to return. we were the first to identify him as a certain level of concern and fully document his travel and his admission interview. after the attempted bombing, we provided to it -- provided the

fbi with the phone number from the person who sold the car to the actual suspect. we provided the fbi with his name, picture, and address. we then posted him in our system. sure enough, he hit are targeting system when he attempted to flee the country. we worked closely with our d h s partners and our local partners at jfk airport to stop that departure as he had already boarded the flight. in this case, every second mattered and highlighted the need for real time targeting and cooperation between federal, state, and local partners. in the interest of time, i would discuss more when you get back. i just wanted to get on our office of intelligence and operations was established in 2007, merging the former offices of anti-terrorism

intelligence as well as components of the field operations, border patrol, and infotechnology. we are the coordinating facilitator that integrates and leverage is all of our diverse intelligence capabilities into a single, cohesive intelligence enterprise. we support the agency's extended zone of security to the use of a multilayered approach to address our borders, consisting of collecting advanced traveler and target information, enhanced law-enforcement technical collection capabilities, and information sharing relationships with federal, state, and local agencies. i will talk about targeting when you get back. >> thank you timely for summarizing your testimony in that fashion. if we had a series of three votes on the floor. the subcommittee will stand in

recess for five minutes following the last vote in the series. [gavel] thank you. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]

>> the committee will come to order. i thank you for your patience and your testimony. at this point in time, what i would like to do is to begin the questioning. i hope we can do five minutes for each of us and then, at the conclusion, if we have remaining questions as well because there is an awful lot of material to go through. to begin the questioning -- undersecretary wagner, i am very grateful for you being here and for the role you have undertaken in an agency in which there has been a great deal of, not just collaboration, but, of

course, a role in which a number of agencies have been put together in an effort for us to effectively respond to the multiple challenges. that is difficult in any point in time. when you're talking about sharing intelligence across the agencies, i think we have done -- in the we have made a great deal of progress in terms of breaking through some of the old stove piping as well as some of the agency tendencies to what to hold onto their role in their information. i am greg will for the progress that has been made, but we are again a very active world again information flows. one of the challenges that each of us has is the prioritization. some elements of our infrastructure are defended against attack. others, not quite so much.

if we are always worried about the ability of terrorist to adapt to what we have to do as well. we are also quite aware that there were 12 homegrown inspired jihadist terrorist just in the last year. 10 attacks and 10 plots by american citizens who were permanent residents of the united states. they were included in that. by comparison, over seven years since the 911 attacks, there were only an average of two such plots per year. we are in a period of enhanced concern. you discussed the homeland security threat task force, which is being brought to bear against specific incidents or national security investigations. i really would like to know what role but -- what role that group is playing now in light of the information that we

purportedly received from overseas with specific threats against some of our infrastructure. >> thank you, mr. chairman. the name sometimes causes some confusion because it sounds like another. they really do different things. the dhs threat task force was created by my principal deputy in the wake of heavy cases. it was created largely as a way to pull together all the different pieces of information that were in the department at all the expertise in the department to make sure the department leadership was up to speed on the rapidly evolving threats. we have expanded the mission a little bit to be the focal point of falling emerging threats to the homeland and making sure we have pulled all the right

strings, touched all the right data sets, reached out to our partners at the fbi to make sure that we are all up to speed and are doing what we need to do and everyone is on the same page. it is staffed by a mixture of our main component people. it is currently headed by someone from ice. recently, we were the focal point for dealing with the information flowing from the exploitation of materials captured during a raid. we appreciate the fact that we got people from the components to help us deal with that. we are using it to be our focal point for revealing that information at determining whether we need to request more. we need to get information out to our state and local people. >> do you believe you have the capacity to make some discretionary calls and to be able distinguished from all along that trove of information and that there is a capacity to communicate that dell appropriately to the local

level? -- to communicate that down? >> absolutely. i have rarely seen such a good interagency effort on this. we have seven people participating to are linguists. they are helping with the translating. there are people from all over the community participating on that. we pull together a group to pull together -- we pull together a group to work on the issues. it has been going relatively smoothly considering the volume of information. we have been working jointly with the fbi to put out most of the information that we get put out. we have put out probably about 12 classification levels.

based on this information and in combination with information that is still coming in to our intelligence channels. >> my time has expired. i will turn to ranking member speirs. >> thank you, mr. chairman. thank you to all of you for your testimony. you really are the unsung heroes who do this work. you go unnoticed, but make sure our country is safe. let me start by asking you, the house is suddenly considering a $1 billion cut to the dhs budget. how will this affect your intelligence functions? >> i will start by saying that i think my office has fare reasonably well. we are appreciative of what we

received from the appropriators. i will defer to the others on any issues they may have. >> thank you. my understanding is that our budget faired fairly well as well. if we are not anticipating any major cuts at this time. major cuts would have a significant negative impact on our ability to collect and report information. >> the same period from the gsa -- tsa perspective, we are doing really well. >> from the ice perspective, i think we are doing well. i would want to make sure there are a couple of critical pieces that are in there. one is we had an and utilization for our southwest border. it was supplemental. the work we're doing on the southwest border is critical.

we would not want to see that falter. so far we are good. hopefully we can keep it that way. thank you. >> our intelligence capability also paired well. -- faired well. there was a small pop up for are targeting capability. one of the things you heard today is the cbp targeting capabilities reduce support all of our partnering agencies. >> if i could add one thing. it does not specifically an intelligence issue, but we are concerned about cuts to the grants because the grant program g -- from fema is a source of a lot of funding for state and local partners. while that is not specifically in my benefit, we are obviously benefit -- we're obviously interested in them retrieving enough funding to be active participants in the homeland security enterprise.

>> where any of your agency's involved in examining the bin laden drove? all of you had a role in reviewing the materials? ok. this is a diagram of this entity that you are part of. undersecretary wagner is in the middle. it is somewhat confusing because there are straight lines and then there are dotted lines. it is difficult to bring 22 agencies together in a group that had been independent and have everyone work well together. i am sure there are many challenges, some of which you may know what to discuss in public. as you move to a doubt, i want -- to adapt, i want to know

whether or not there are still areas that we should be aware of in terms of assisting you in unifying as a single agency. >> one of the areas that we, i think, still struggle with as a department is integrating our information systems. we came from a bunch of different places and we have a lot of different legacy systems. the department has a great deal of data -- travel data, integration data -- it is all in very different stovepipes. -- immigration data. we are working very diligently with the components and with the department's chief information officer to work through how to do a better job internally, ensuring we have appropriate access to our data and we are not having to redo pontians -- functions multiple times, check individuals multiple times against multiple databases. we have a way to go before we get to that goal. that is something we are still working on.

i would offer anyone else the opportunity to come if they are interested. -- to comment if your are interested. >> i agree with undersecretary wagner. was the biggest challenges we face is the vast volume of data we have to sift through. having the data tools and the connectivity to be able to look at tsa our intelligence community data and to be able to do that in an integrated fashion is a challenge that we all face day today. -- day-to-day. >> anyone else? >> there's a tremendous amount of collaboration that has to occur and you need the tools out there. there are documents we have to go through every day. there are tools out there that could help us put them together into an analytical pocket at the end of the day.

that could be very helpful. >> in the assets of time, i will -- in the essence of time, i will concur with my colleagues. >> ok. the only one point of light to have is we need the ability to go from the backside to the plus side. persistence need to be able to do that. >> thank you. all right. i yield back. >> thank you, ranking member speier. at this time of like to recognize the gentleman from minnesota. >> thank you for your service to the country. you are the unsung heroes. you're the guys that do not get the metals. the ribbons, butwe appreciate all the things that you'd do. thank you very much for that. my quick question is, admiral, could you tell me what keeps you up at night? where do you see -- what is the

main threat to the ability to do your job? >> as you know right now, we do not have an imminent threat in the maritime domain. being the new guy on the block, i am still learning a bit about what the intelligence committee is working on. i think my biggest concern is two-fold. one is safeguarding coast guard personnel themselves. shallhow do we provide the right force protection? the next piece would be those transnational threats, whether they be from middle -- criminal or terrorist organizations and how they are trying to get into the country and attack the american people. not having a specific threat right now, it is really trying to identify working with the colleagues on how they are coming into the country and have to stop them. >> thank you. i feel your pain when it comes to being the new guy on the

block. you kind of alluded to it in your opening testimony, can you expand on it a little bit? >> we had a closed-door session a couple of months ago. it continues to be a threat to aviation followed closely by mass transit a different dress that are out there -- different threats that are out there. our regional focus into the united states. >> thank you. could you look to it also, as well? >> the short answer is my blackberry keeps me up at night. [laughter] all kidding aside, ice has a wide breadth of things that we cover. it is the violence between drug cartels, it is the pedophiles, it is the transnational criminal organizations that we investigate, it is the threat in cyberworld. there are many things we ought

to focus on in order to make sure our citizens are safe. to be honest, i wish it were but only terrorism. unfortunately, it is much much more. >> thank you for that. i thank you for being by your blackberry. ms. mitchell, could you expound on that, as well? >> i think for cbp, the biggest thing we're concerned with is some of the unknowns. we have a good handle on identifying those we know are bad, but making sure our systems at that predictive modeling capability that allows us to pick up on those travel patterns that should be of concern. also, the impact of global security. we are partnering with a lot of foreign governments to ensure they are picking up on that same thought process for targeting as we have here. >> have you felt the at the national committee to be assisting you with that a

little bit? is it more of a challenge? >> as they are finding that they themselves are targets as well and we can show some success stories in are targeting methodology, they are becoming much more willing partners. . .

>> a lot of the genesis comes from, the boots on the ground level. i am from minnesota. and because of an alert pilot that was giving instruction to a guy that wanted to take off in a 747, not wanting to land but just fly the plane, and that's how it could affect the chain of command. can you update us on that progress? >> i think we have made progress in the last years building a network with those upwards and with national law enforcement communities and sideways with each other. that's another regional aspect of this. what we are trying to do in ina, and ina is leading the efforts of the department that includes the component participation, to include training and anything we

can help the fusion centers to achieve the level of ability to analyze their own information. report on it and understand what information is valuable to others to be effectively shared. we have ino's officers at the fusion centers, and we provide training courses in writing, reporting, protecting civil rights and civil liberties. and i think we are seeing from most of the fusion centers improved level of situational awareness and products. we are focusing on implementing with the department of justice, the national suspicious reporting initiative, and the fusion centers are a key element of that. and the secretaries have been out for the see something, say something campaign. and that's a way for the fusion

centers to leverage the american public for information behaviors that could allow us to disrupt activities. and between these campaigns and the initiative feeding both us and the f.b.i. guardian system, and the constant interaction we have, we are in a good position to use those guys in first-line of defense. >> thank you, ma'am, and i am over my time, i apologize, and i yield back. >> thank you mr. cravaack, and now the chair will recognize the gentleman from arizona as, mr. quayle. >> thank you, mr. chair, we hear about the information sharing between the various agencies.

but don't hear about how that is done in the each individual departments at dhs, and what are you doing for this sharing in the dhs enterprise? >> we are doing multiple things, there is not a single silver bullet for the information. we start with the association we talked about earlier, we meet on a regular basis in person. and we have weekly teleconferences to be sure we are on the same page and trying to address collaboratively. and we have daily interaction, these people have representatives on the task force that is keeping everyone up to speed on emerging threats.

our analysts work on joint products many that are shared with the secretary and various partners. it's multiple interactions across the board. and we work closely on collection requirements as well as on analysis and developing analytic tools. i can't even discuss all the levels of interaction. but we have been trying to significantly improve the cooperation and the communication. and i think we have made a lot of progress. >> thank you, and you said that the drug cartel activities have been keeping you up at night. what are we doing to apprehend and not see the drug cartels move across the border? >> as we have seen the threat

particularly in mexico and elsewhere as well. i have seen a higher level in place by the larger intelligence community. and i would say candidly they are responsive to our requests for information and support. and it's a strain, i know we have wars in afghanistan and this community is stretched thin. but it's a threat that is close to home and impacts our communities tremendously. we're doing what we can possible from a law enforcement perspective to bring the cartel members to justice. and to be sure that what is coming out of our operations as we understand the cartel structure, where they are operating and how they are operating and how they are communicating. we are making sure we pass that information to the intelligence community to better sharpen their focus as well. >> what is the ability to work with your counterparts on the

mexican side? has that been fruitful? have you been able to gleam a lot of information and have a fairly good working relationship with them. >> i have been in this business for a long time, and in all honesty, i think the cooperation has never been stronger. for example, when special agent was murdered last february, the support from the mexican government as well as the u.s. law enforcement community was unprecedented. the cooperation is good. you can always build and make things better. but i have never seen it as good as it is today. >> thank you, mr. chairman, i yield back. >> thank you, mr. quayle, i hope i may ask another round of questions myself. and the ranking member may have a few questions. mrs. wagner, one of the -- this

may seem sort of counterintuiti counterintuitive. because we spend a lot of time in the intelligence field trying to develop as much information as we can on emerging threats. which means we have a lot of information about a lot of things on a lot of people. you build a sophisticated network with a broad spectrum of agencies that are simultaneously participating. so within our treasure trove of information, there is information about a lot of people including american citizens among others. you know my own state of pennsylvania, i was aware of information developed by one of our entities that was let out into the mainstream for the benefit of really a private entity that took advantage of that intelligence information.

what are we doing to assure that the civil liberties and privacy protections are in place. so that we access information appropriately, but guard against inappropriate uses of that information. >> thank you for that question, because something that we have focus on a lot. and we have -- for all of us who are sort of intelligence activities, we have intelligence oversight that is embedded in our organizations. and it flows from the executive order 12333 and the guidelines in which we operate. we have well defined ways of training our people. and double-checking that we are following the rules and going through our reports and seeing how we are doing. for the network of infusion centers this is a new world. so we have focused a lot of

effort and resources to train them regarding the rules guarding privacy and protected activities. we have worked with them to ensure that every fusion center has a privacy policy in place. and we work with them and that those are adequate, and everyone in the fusion center is trained in those policies and they are followed. we work closely with our civil rights offices to provide training teams to ensure they are fully trained on all the same things. >> do they take that and reach out as well in their communities, local police and otherwise? >> yes, they do. i am confident that we are very much leaning forward to build privacy and protection at the front end of the fusion centers and in all the products that we

are putting out. >> thank you for that, and if your work on that. it's vitally important as part of our mission and often overlooked. and you touched on things as a private attorney, and i think if there are some things that we can do better. you touched on one area in which agencies like yours may be the only people that are an opportunity to reach out and be a lifeline to some victims that live a horrible existence. and these are human trafficking and others who are put down into this system. how are we doing in that battle? >> i think that human trafficking is an area where ice has really stepped out in front to take a leadership role in not only rescuing victims but going

after and prosecuting the horrific criminal that is commit the crimes. but equally important we have coordinators in the field offices to ensure that the victims get the help they need. and similarly we are working with the community organizations and the nongovernmental organizations and working domestically and overseas to combat human trafficking. >> how about with the local police department, and others, it was a concern that you would have someone come in and it's an immigration violation but not worth my making arrest for a purpose. but looking past signals that may indicate there is more going on. and we are training local police to identify the signs and ask

the appropriate questions and come back to experts like you or partners? >> absolutely, a big part of our effort citizen outreach that we do. including working in local human trafficking task forces throughout the country. and as authorities identify signs that may be an indicator. they know how to ask the questions and go that step farther. the outreach we have is training and as well as conferences and passing out brochures. and no substitute for working hand-in-hand on the task forces. and they can understand what they are facing, and oftentimes the signs are hard to detect. the victims are often scared to come forward, and it takes a lot of work to uncover these violations. >> thank you, my time is expired

and return to the ranking member, speier. >> thank you, i am too concerned with the human trafficking situation. and i convened a workforce locally and had the district attorneys and the u.s. attorney and f.b.i. and local police all part of a training. and we have met five or six times in training. but i tell you that we really have just scratched the surface. and while we make resources in your jurisdiction available, we need to do much more. in the short time we have worked on this issue, our local d.a. has gone back and recognized that two domestic violence complaint on the same person with different complaints turned out to be a sex trafficker. and it didn't dawn on him until he started and participated in

this program. i bring it up only because i think we need to do more. and i know you are already taxed but it's a horrific problem. and the sex trafficking of those under 18 is somewhere near 300,000 in this country alone. i hope we see new initiatives coming out in your agencies to help in that regard as well. i have one last question. it would appear based on what we have gleamed from the information that bin laden had in his location and vail was an interesting location and i traveled with my daughter by train. and i did it a lot, because i think that the trains are porous, and i don't know what we

have on the way to address that issue. but it's just ripe for some kind of attack that will come from a lone wolf who is home bound. right amongst ourselves. if any of you have thoughts what we can do or should be doing relative to rail, i would appreciate hearing it. >> i will say one thing and turn over to dan, because it's a psa issue. we have known looking at events overseas that rail is a target interest to terrorists and if we look at what happened in london, madrid and moscow. we have been publishing on the tactics and techniques used on attacks on rail to our law enforcement and public partners to help them think through the measures through some time.

but i will turn over to dan for any specifics. >> we have specific analysts that look at rail and passenger rail and they do annual assessments both at the classified and unclassified level. and probably would be better to have a closed-door session anda walk you through the findings in the rail that we have out there. especially in light of bin laden's roll up. >> i want you to be comfortable that we have looked at this for quite a while. >> absolutely. >> i want to express my appreciation to this panel. first for your patience and the excellent testimony. and lastly and most importantly for your service. i think all of us appreciate you on the front line, and on a front line in what is now a very

precarious time for our country. and yet at the same time, i don't like to be alarmist. because i think that the work you are doing is making a big difference. an increase in real threats to our nation, but simultaneously if you looked at this 10 years ago, from september 11, and there are few that would argue that we have not been vigilant and had some genuine successes. but not a one goes to sleep at night and says, ok, because tomorrow is another day. and i know it's not on my watch. so i want to thank you for your work but more important your service to our nation. so the members of the committee may have some additional questions. and i hope that if they do those, that you will do your

best to be responsive as you can, in writing. and the hearing record will be open for 10 days. without objection, the committee stands adjourned. >> next a discussion on american reaction in the middle eve. >> we want to welcome back to

c-span from the middle east, our guest. let's begin with the news this morning, a situation in yemen, where there is a power change and a power vacuum that could provide a resurgence for al-qaeda. guest: no fact there is a turning point there, and the president left yemen to get medical treatment in saudi arabia is important. while it's uncertain whether he will return to yemen or not, people see this as an opportunity for transition. a transition where you have a major vacuum of power and this struggle with uncertain ending. and there is a possibility that somehow people will go through the constitutional change with the vice president becoming president for two months. and having elections.

and following that, it may be possible to appease the demonstrators with that change. but no question it's a turning point and we have to make clear that we don't know if he returns or not. the fact that he went to saudi arabia with a large number of people around him, advisors and family members, and possibly his son, according to news reports. indicates it's more than just getting medical treatment. one thing that's remarkable in all of this, this is a president in yemen and been in power over two decades. and he gets winded, and we don't know the extent of it. he's to go to another country to get medical treatment. this is an indication why there is such frustration with the lack of development.

can you imagine with a president having to go to a country that had troubled relations. so that's a bit of indication of the kind of state that yemen is in now. host: the headlines, "the al qaeda brain is slain." one of t top al qaeda military commanders reportedly killed by a drum strike. what does his death mean for al qaeda leadership? guest: one of the thing that has not been reported as much is that the u.s. has killed many of the top leaders over the years. obviously it is the kind of event, like th killing of bin laden, that was huge. it amplifies everything that happens. the psychology is more important than the operational. >> where do things stand between the israelis and the palestinians democrats the

relations betwe the israeli prime minister and the white use of being described as cool and frosty, yet they continue to push to get an agreement between the palestinian people and the israelis. guest: this is a critical time. i just came from the strip. it is cle that the prospect it is cle that the prospect of any kind of political move in the short term is very small. heading into the fall, whether you are going to have the palestinians -- barring a change orenewal -- going to the un assembly to request that they recognize the palestinian state on the 1967 borders, they are likely to get a majority to support that. that is going to generate whole sets of events that are going to be troubling in many ways for

the israelis, troubling for the relationship. in the last couple of days the former head of the israeli mossad has been warning that he is worried about the intense pressure coming on israel in the fall. he has admitted that some israeli leaders mighte thinking about striking iran. all of these issues are connected. we are going to go through a very stormy summer. probably more stormy in the fl unless we have something going on in terms of an israeli issue. we have the most important case of revolutions, egypt, going through an election in the fall. the timing of the egyptian election and the general assembly meeting is critical. it is clear that this issue, which has not been a main issue

for revolution, will test the relation. whether it is an issue in front of demonstrators, jordan over the last couple of days, or caing for the report -- the end of the relationship with israel, it is likely the key that will be generated is likely to generate problems outside of the conflict itself. host: we learned that the trial for jose mubarak will get under way on august 3. how likely is that to stick? guest: keep in mind that the military rulers in egypt are his friends. the most powerful man in egypt right now was his close friend. he was the second mo important man in egypt during the regime. it is not an easy thing for them

to go through. public sentiment is such that it is sweeping through and worrisome. one of the powerful feelings about the egyptian revolution is that it has been largely peaceful. which is extradinary. the public had been sticking to that slogan, peaceful, peaceful,eaceful. capturing the imagination of the international community, even the american public. public opinion poll about how the american public sees egyptians in light of this, 70% of the american public has a favorable view of the egyptian public in light of this seemingly peaceful revolution calling for peace and not extremism. the trial of mubarak, going after people in the regime, who are in the thousands and maybe

more, invested in it, seems to go against that nature. people are worried about the revenge aspect and they want to see someone in political leadership saying they want to be the next mandela. let's go to the next level. i think that egypt is very hungry for a leader like that. it will be interesting to see whether the political campaigns will produce leaders who will restrain the reaction to members of the regime, particularly the muammar family. host: there are so many different historical moving parts in this, but one of them is clearly hamas. guest: much of it has to do with the fact that hamas and fatah have reached an agreement to

have a national unity government that would be technocratic. going to the next stage. that has not been sitting well with the u.s.. certainly not with the israelis. clearly, that is an issue. remember, today is june 5. the day when the 1967 arab- israeli war started. the simple six-day war. obviously that is an historical event as it is when israel came to occupy the west bank in syria. returning to sign from egypt, gaza still keeps the golan heights. still an issue for the negotiators today. now we have additional events of people trying to cross the border, with demonstrators, particularly from syria, trying

to cross the border into golan heights. there were reported shootings and at least a couple of dozen people wounded. all of these reports are too early to know, but it is expected and more of that is going to happen. how a groupike hamas will exploit it, they are caught between tworoblems. they see that the power is in the peaceful nature. even in yemen with all of the fighting that took place over the past few days. the demonstration is to stick to peaceful. there ithat part of it. of the other hand, there are sponsors in damascus that are in trouble with demonstrations, having to reassess. egypt has reqred more sway. they have to be responsive. hamas has more limited space to operate. one reason why they were anxious

to reach an agreement. the agreement that happened between fatah and hamas was more hamas making exceptions for what had been put before them the other way around. looking at the revolutions and strategic implications for all concerned. host: shibley telhami is the professor for peace and development at the university of maryland. he served as an adviser to the government and it is the author of a number of books, including mixed state. power and leadership in international bargaining with a decade of reflections on peace. we will get to your phone calls as we talk about the situation overall in the middle east. maxine is joining us from cleveland. maxine? a good morning? we will try it one more time.

caller:ith regards to the speech that president obama dave, he said that israel and palestine should agree upon the 1967 borders and mutually negotiate land swaps. most of the time when people speak on it, republicans especially, they leave that out the part about mutually agreed upon. why do you think they are doing that? ey are not quoting his entire statement. also, when benjamin netanyahu spoke, he pretty much said something identical to what president obama said. because he used a slightly different syntax. he got 29 ovations. i would like for you to comment more on whether or not israel is less safe with this arab spring. could they make some kind of

agreement right now with the palestinians that they have not been able to make them? -- been able to make? guest: i think that the president broke ground with that speech. it was not new language, to be sure, but frankly it is the kind of position that had been taken behind the scenes in negotiations between israelis and palestinians. he said based on the 1967 border understanding that there would be alterations, which is pretty much the american position. the president had been under pressure and many in the media were advising to take a different position, to be more forceful in putting forth an obama plan, like the clinton an, on major issues. in some ways this was actually a modest statement that he had to

make if he was going to sa anything about the issue. i was not as much surprise that the president said that as to why the prime minister of israel reacted the way that he did. when i heard the speech, analyzing it, i did not see it as a breakthrough speech. it is very interesting to know why that was the case. having heard what the prime minister said in congress, by sort of understand. he had aimed in some ways to connect what i think is a very important support base for his position in the american political spectrum, including the evangelical right, which has seen the conneion to israel through biblical terms, not un resolutions. if you listen to the prime minister's speech, he put forth a different paradigm. that we are not an occupier.

in some ways i think that the in his own blood was putting forth a different paradigm. -- in his own mind was putting forth a different paradigm. so, it is a different paradigm and it might explain why. nonetheless, there is no question in my line, as an analyst, that there would be a two-stage solution. it is the only viable solution in any foreseeable future. and it has to be based on the 1967orders. i do not think that that is just my own position. most people that look at this historic place see it that way. host: secretary gates is taking his final visit to the region as he wraps up h tenure as the

defense secretary in the administration. he is urging with this headline patients with the afghan war, essentially keeping troops in longer than anticipated. the same argument can be used in iraq. guest: it is a tough call for the president. when you look at it, this president understood that i am the hand, the intervention in iraq was troubling. iraq was troubling. in iraq it is hard for the president not to pullout. it does not mean that you cannot have an arrangement that will help the govnment. afghanistan is a different order of things. the president himself said that going there was a mistake because it took away from what wehould have done, finish the job in afghanistan. well, he did finish part of the job i am given -- i am getting

bin laden. looking at the war in afghanistan it is hard to see how there could be a successful military ending. at the same time, gates is talking about maintaining troops for a longer period of time and there is the issue of finding a way to negotiate with the taliban. everyone understands that it has to be some kind of political settlement, using the military is reported as a lever, is another question. i understand his realist position. he has been a realist in the bush and obama administration. he seized the u.s. military presence not as a means of ending the war successfully, but as a means of providing a negotiating lever to provide a political solution that might be more acceptable to the u.s..

host: pat is joining us on the phone. good morning. caller: you mentioned something about what the examiner said about what gates said in afghanistan. that is wrong. they said they would keep to the timetable of the withdrawal. the examiner goes to the extreme, so i hope that you will use the actual and correct paper rather than all of these right-wing paper is. i should point out -- host: i saw that interview that they conducted with diane sawyer, indicating that he wanted to give the president flexibility to make some decisions. the time line will be coming in early july as they reevaluate the presence of nato troops. indicating that patients could be keeping troops longer than

expected. ultimately it is the president's decision. caller: one question, for you, steve, did c-span -- i have watched for several years. i would like c-span to go bk to what it used to do. to bring facts out for us to make the decion. i do not like all of these christian group conservatives, all of these lies and what ever on c-span. i would just like the facts and i will make my own decision. i hope that in the future you will consider that. regarding the israeli, palestinian issue, the opposition party, which has more and more votes when netanyahu comes in because they have a parliamentary system when obama gave his speech, the opposition party and a lot of retired

generals in israel had a very different position than netanyahu. yes, the american leader, c-span especially, refused to bring any of those people on the television to let the people know what was going on. what is good for the usa? that is all that i care about. if we let people have the facts, because of the political issues in israel, we would be better served in this country been clinging to other people's political doings out there. th is all that i have. host: thank you for the call. if you have watched this program since we have been on the air, we have always presented different points of view and a variety of political spectrum in a chance for you to call in. we always allow you to make your own decision. guest: the element of where the

american public is on this issue, i do doolling of thamerican public and i ask quesons as to whether they want the government to lean towards one side, the other, or neither. the most recent was done in april. in that case almost every time that we ask that question,wo- thirds of the american people what the u.s. to lean towards either side. whatever information the u.s. gets, they are not swayed that they should take one side of the other. for those people that want the u.s. to take side, roughly by an issue of five-one, 5% want to be one way or the other, they happen to be the most determined segments.

people that typically write the issue higher. the two-thirds majority does not care as much about this issue su as to have its opinion weighed in in the polical process. we find that that constituency is largely in the republican party, by the way. there is a huge difference in the answer to that question between democrats, republicans, independents. clearly a large portion of that is the religious right. an ideological posion that is likely to be unaffected by what c-span broadcasts. most of the headline this morning from "the new york times" -- host: i think that the death toll is in excess of 650. >> if he cannot end the violence

against his own people and take meaningful steps to start a process of reform, then he needs to get out of the way. every day that he stays in office and the violence continues, basically he is making that choice by defaults. as i have said, the tragedy of the young boy symbolizes, for many people around the world, the total collapse of any effort by that government to work with it thr own people. the international community has to continue to make its strongest possible case and call for specific actions. not just amnesty, but a release of political prisoners. the end to unjust detention. allowing human rights monitors into the country.

everythg we can.rewe're doing those we are seeking to bring to our view of the situation, i think, will have to make their own judgment. we think there will be better off on the right side of history. host: it was friday on which a syrian troops gunned down 65 protesters. over the weekend, tens of thousands demonstrating in the city of hama, which has significant history in syria. years ago, an estimated 10,000 people were killed there. guest: it could have been significantly more. there was a major crackdown there. to this day, you can see that, while much of the direction -- destruction has been fixed, you can still see symbols -- of the

crackebuildings, some of the destruction dating back to 1982. i always think that is dated both -- that is intended to both say do not forget and we will not forget. it is happening again. wh large scale destruction could take place we do not know, but one of the things that is interesting is, backn 1982, of course, the media could not cover much at all. we did not have many pictures, we did not have live television shots. obviously, brutality is much easier to do when no one is looking. one power of the era resolution -- arab revolution is that things have been broadcast everywhere. whether or not this can be repeated -- in the dark -- is a darkmark -- in the dark -- is a

question mark. people are able to use phones and send them to al jazeera and put them on line. last week, i was in the al jazeera headquarters in doha, qatar. i asked him about covering the revolutions and what they do. he said, access is critical. in libya, even though it was closed, once there are areas that were frd from gaddafi's control, they were able to send three sets of equipment to cover places live. inahrain and syria, they have a problem, because they're prevented om going in to cover the story. they are relying mostly on these individualwho are taking -- using theirhones or local cameras and fiing a way to apply them or send them to al jazeera. i think the issue of how far can the regime did away with -- get away with brutality is going to

be a function of coverage. one other point i want to make is on syria. one thing that is interesting in these revolutions is that the public's in these regions a no longer differentiating between pro-u.s., anti-u.s., tough on israel, easy on israel -- they just feel these regimes need change. when i was in powerquare -- tahrir square, one of the signs tahrir square, one of the signs had a picture of every major power. they did not differentiate on the basis of ideology. syria had credentials in the country of holding talks with israel, but that does t seem to be protecting them, certainly with -- not with the public. it is. the interesting to watch next few weeks have the story and --

it is going to be interesting to watch in the next few wks how the story unfolds. the violence from the security services has been fascinating. a lot of people said, how much -- and the public have? we have seen it in libya, misrata, yemen. people are still standing firm. this is a fascinating wave that is sweeping our world. the barrier of fear has been broken. people have been prepared to pay a heavy price. how heavy? it will be an interesting story. host: 10,000 people killed and half this segment is about israel. the site of the 1982 killings -- sad'swas president as o father. jeff from boca raton, florida.

caller: you and i spoke on "washington journal" some years ago. i stated my concerns about egypt abrogating their treaty with israel. you assured me that this was a political thing. that the muslim brotherhood and and tribes, codes of th which arafat referred to -- which says, "no treaty with the unbeliever." when israel left southern lebanon, they got has a lot. when they left gaza, they got hamas. now we are supposed defined borders with the palestinian state -- supposed to fin

orders with the palestinian stat stat hussein the elder killed thou sands of plo members. we sit gunboats. -- see gunboats. we see hamas getting more military hardware than they already have. th regard to the earlier individual who called, this is international. the iranians boast that they have rockets that will reach europe. indeed, they have rockets that could indeed reach washington d.c. -- washington, d.c., and they are not above the calculus

-- if they destroy the united states and israel, they will be -- there will -- the retaliatory attack could kill 10 million to 20 million iranians, but it is worth it, because there are more muslims there than anywhere se. guest: on the risk israel would take if it were to withdraw -- it is obvious that israel is not in a position where peace is around. obviously, it is stable for now. everyone understands that the storm is around the corner. if you're looking at it in terms of the future, it is impossible to envision a peaceful settlement between the israel and arabs that will not be based on the two-state solution. if that is what you want and you want to take that risk, israel

will have to make that choice, but that is my assessment. on the egyptian side, i think you're correct to place the emphasis on egypt. i think egypt has been a very critical player, particularly for the israelis. it took them three decades, from 1948 until the camp david accords in 1978, for israel, essentially, to make this peace with egypt, which had been the most part what -- most powerful arab state. obviously, the israelis are worried that it might be challenged. for now, the egyptian military, which remains the anchor of the transitional government, most certainly is not interested in the abrogating that treaty. they do not want war. they're coordinating with the israelis. how this would unfold in the

political process is another story. my own worry is that, absent an israeli-palestinian, credible, peace process, which people can have confidence in, this issue of the israeli-palestinian conflict will resurface as one of the major issues in the egyptian internal debate leading to the elections. it will put a strain on the relationship between israel and egypt, not on the peace treaty necessarily the short term, but on the cooperative relationship. it already has, such as the egyptian opening to gaza, which had taken place recently, allowing people free movement intogypt. egypt is an anchor. the answer to tt is to address the israeli-palestinian issue. if you do not, it will ignite the debate in every single country where this has not been a central issue. it will make it a central issue.

it will test the relationship and create a strategic environment at will not be comfortable. host: let's get a comment from one of our viewers and a call from trenton, new jersey. guest: this is a very interesting comment. when the demonstration in egypt broke out, i wrote a piece for politico and said, don't bank is about the united states -- make this about the united states. one of the reasons this has captured the community is that this is indigenous. it is hard for the u.s. to say -- the government to say this is the u.s. meddlg. the public is not buying it. it is indigenous.

it is pervasive. it is important. i think the u.s. should, in principle, supports the aspirations of people. if we cannot stand for that, we stand for nothing. beyond that, we cannot make this about the united states. that is critical. in my public opinion polls here, among the american public in april, asking the public whether they want united states to take a position of either the public or the government in the arab world, in every single country, 2/3 want to stay out. of those who want the u.s. to intervene, again by a ratio of 5-to-1 or 2-to-1, depending on the country, the u.s. public wants the government to take the side of the peoe against the side of the government. that is true for every country from syria to saudi arabia. host: you have another comment among the 2/3 -- don't you think

we should worry about our own problems? you are on the phone with professor telhami. caller: good morning. what is the meaning of "peace"? how can we have peace when the politician and the christian are singing the same song? host: i didn't mean to cut you off. how do you define "peace"? guest: in terms of the israeli- palestinian conflict -- i am a professor of peace studies in some way -- i will just the finest in the context of the arab- -- define itn the context of the arab-israeli

conflict. you have relations that are secure. it is more than having a cease- fire. it is a state of mind of having "normalcy" between border states. host: whether it is uncertainty in yemen, the nato air strikes over libya, the democracy in egypt, the ongoing middle east peace process -- what worries you most? guest: there are two things i would like to say. egypt is, by far, the most important case. yemen is fascinating. libya is important. every country is important and its people are struggling to g freedom and dignity. it is really about dignity in the entire arab world. in some ways, there is a arab revolution, not just egyptian, libyan. it is a major awakening of peopleho want rights, dignity, freedom. egypt will be critical.

he did, in terms of its size and history -- egypt, in terms of its size and history, is an inspiring model. because it followed to the shot -- to any job -- tunisia, it is central. ere is an international interest in seeing the aspirations of people fulfilled, in seeing peaceful transformations take place. there is a stake in making egypt succeed, helping them succeed, not intervening, but -- they do need economic support in the transition. if we fail -- to think about this for a minute. if we fail, that energy of the public, this impairment that has come out of the infortion revolution -- it is going to --

this empowerment that has come informationinfrared imag revolution, it is going to stay with us. we have a stake in the making sure that succeeds. the cond issue is the israeli- palestinian conflict. do not underestimate how central that is, psychologically, for the region, even to the notion of dignity. the bigger sense of dignity that people are seeking in every arab country, it is freedom and foreign policy. the fact that these regimes have pursued policies that went against them. israel-palestine question has- symbol of a lot of humiliation -- has been a symbol of a lot of humiliation.

unless we move forward -- host: we will >> and later, pension benefit guarantee director, joshua gotbaum. that's live on c-span.