work. commissioner alluded to this with respect to licensing issues. one example is the tax passed in 2003. fair and accurate credit transactions tax, and he came out of the financial services committee, and required be ftc to conduct 30 separate some of those obligations made sense. at one point in 2005 and shortly after i came to the commission, about a third to half of our financial practices staff, and these are the folks who go after mortgage fraud were spending time writing reports because they were obligated and we do what congress tells us to do. we have been reporting reports since 1914. we are very good at it. but in fact, our staff should have been spending more time going after the bad guys who were preying on american homeowners. so consistent with the goal of reducing unnecessary burdens, commission staff has now worked to identify reports required by statute and i think statutes themselves that divert

businesses or commission resources from more pressing work. and the staff has identified sort of two such reports at least preliminarily. so year after year, the mandated ethanol industry report has shown that there is almost no concentration in the ethanol fuel market. the report doesn't appear to provide significant value to the public but it does impose burdens on small businesses because they have to respond to inquiries from the f.t.c. and so our staff is proposing that the report be eliminated or at the very least the frequency be reduced to every three years. additionally, while the f.t.c., d.o.j., department of education are very involved in fighting scholarship scams and for the f.t.c.'s part we compile complaints, the annual report that -- about scholarship scams, the annual report that the three agencies must jointly produce each year on the topic which is required by statute doesn't appear to f.t.c. staff

to advance any real or significant goals. so mr. chairman, through these four initiatives, we are working to improve the f.t.c.'s review program. we will do our best going forward. and working with this committee to ensure that all of our regulations protect american consumers while minimizing burdens on businesses. thank you. and happy to answer questions. >> mr. kovaci crifment, anything to add to what mr. leibowitz -- >> no. >> i'll start with opening questions. before i start i would like to put on the record mr. castine's memorandum of february 2, 2011. without objection, so ordered. and i understand the ranking gentlelady has a document, an evaluation of the consumer product safety database that she would like to put in. without objection, so ordered. chairman leibowitz, before i start my question, i think myself and staff are a little struck that you have voluntarily stepped up to the plate and sort of followed the spirit of this letter right

there. and i think it's interesting when you look at the letter i just put on the record, he said in particular, such agencies talked about the independent agencies, are encouraged to consider undertaking retrospective analysis of the existing rules. you have stepped up to the plate to do it. not all the independent agencies have done it. you have actually identified some areas that you think -- you have to do what you don't think you should be doing it. the question for members of congress is what would you like to do to help you? >> well, i think having oversight hearings like this is -- shines the public light on regulations that do work. because of course regulations are very important and ones that need to be modified. you know, look, we're a very bipartisan consensus-driven agency. we work together. we try to do regulatory reviews because we know they're really, really important. >> you've identified some things that you would like some legislation to -- >> yes. and we've identified.

>> we'll follow up on that. >> that would be terrific, mr. chairman. >> commissioner mcdowell, i couldn't help but take your comments, sober and clear manner, when you talked about over 50 years regulations have gone up 800%. is that true? that's 16% a year in the law of 1972 every 4 1/2 years these regulations are doubling. that is really staggering to think that that's occurring. is that an accurate explanation of what you said, that regulations could possibly be doubling every 4 1/2 years based upon 800% increase for 50 years? >> that would appear to be the case, yes. >> let me move based upon what i just put a letter in from cast hs sunstein where he said independent agencies should step up and be voluntary. thales the spirit of what he was talking about. president obama has indicated he wants that done. and he didn't include the independent agencies but i would like if you would just to answer some questions yes or no. just for the limited amount of time, so commissioner adler. and yes and no, did the cpse

submit a regulatory review plan to o.m.b., yes or no? >> no. >> ok. >> no, it didn't. >> yes or no, has the c.p.s. publicly committed to conduct a review of all existing regulations in accordance with the executive order, yes or no? >> as far as i'm concerned, yes. >> no, i've not been informed that we're doing anything. having any review. >> ok. mr. adler, if you answer yes, as you did, why hasn't there been a notice so that commissioner northrop would know about it if you answered yes? >> well, first of all, with respect to submitting a formal plan to cass sunstein a. hero of mine as a former academic, in order to preserve independence -- >> you said you have issued a public notice or -- >> what i said was we had begun a retrospective review beginning -- >> but you haven't issued a public -- >> that was temporarily suspended in 2007. and as soon as chairman tannenbaum gets back i will anticipate we will resume that.

>> you believe the cpse should conduct a review? >> oh, yes, sir. >> c.p.s. used to conduct regulatory reviews but has stopped in recent years. is that a fair statement? >> they stopped in 2007 under then acting chairman nord and i believe it was because of passage of the consumer product safety improvement act. and that -- competition for resources within a very tiny agency. >> ok. commissioner mcdowell, do you believe the reviews, the f.c.c. conducts under the communication, telecommunication act, take the place of the kind of lookback the president and this committee has simply asked for? >> no. >> you say net neutrality is the first rule you would discard upon the agency review of its regulation. is that true? >> yes. >> i agree with you. chairman janikowski hails the net neutrality rule making proceedings as a test case for openness. however, i believe there were some bad precedents set in this proceeding.

commissioner mcdowell, you do believe you were able to review the record in the net neutrality docket or items placed late into the docket that made it very difficult to review before the vote? >> there were about 3,000 pages of documentation placed into the record in the final two or three days or four days. >> and you had no opportunity to review those? >> well, there's opportunity. but there wasn't enough time. >> not enough time. >> as commissioner when was the first time you saw the net knew trailt order that you voted against and was it the same rules proposed in october of 2009? >> there were several drafts. of course the first in october of 2009. but we got the final draft about a quarter to midnight the night before the vote. >> ok. i understand although the agency passed its net neutrality rules in december, the docket to reclassify broadband services under title two remains open. i think this is surprising as chairman janikowski has made efforts to close other dockets open at the f.c.c.

do you believe this docket should be closed? >> yes. >> are you aware of any reason why this docket remains open? >> only speculation. i have no first hand knowledge. >> chairman wellinghof, in your testimony you said you support the goals of the executive order and have directed commission staff to conduct a review of existing regulations with the goals of the executive order in mind. why didn't you submit a regulatory review plan to o.m.b.? >> because i believe that we weren't subject to the executive order under o.m.b. >> notwithstanding what cass sunstein has directly -- the spirit of the law was for you to comply? >> i believe in fact we are complying with the spirit of the law by directing the regulatory review that i've directed staff to do. >> have you submitted a notice for public comment on this review? >> my general counsel has indicated that's not necessary to staff review. >> well, let me ask you personally, do you believe ferc should conduct a retrospective review in the spirit of the executive order? >> i've directed my staff to do

that. >> my time's expired. >> thank you, mr. chairman. mr. chairman, my recollection of what cass sunstein said is the independent agency should comply with the spirit of the law, not the specific legal requirements. and i guess i'll ask you, chairman leibowitz, since your agency is supposed to be the paragon of virtue today, have you submitted a plan to o.m.b.? has your agency submit add plan to o.m.b.? >> we have not snitted a plan to o.m.b. >> that's because you aren't legally required to. >> because we are not legally required to do. >> it doesn't mean you aren't doing regulatory form. >> we are doing regulatory reform. >> and although your agency has not submitted a plan to o.m.b. you are doing regulatory review. >> that's correct. >> chairman leibowitz, something you said was very interesting to me. you talked about how a lot of

the regulations that you do is a result of statutes passed by congress directing you to do regulations. correct? >> that's correct. >> and you gave several examples of that, right? >> yes. >> now, commissioner northrop, you talked about a lot of the regulations that the cpse is promulgating as a result of the statute that congress passed, correct? like the lead standards and other regulations. >> exactly. >> so mr. chairman, one thing i'm concerned about is you can't really talk about regulatory reform in a vackyume without looking at the stat -- in a vacuum without looking at the statutes that was passed that ask these agencies. so i think there's two levels here. there's the regulations themselves which may be overburdensome but there's also statutes that i think we should look at. and i know chairman leibowitz, you had actually come up with a list of some statutes that you think could be streamlined so that the agencies, whether they're the independent

agencies or not, could also streamline their regulations, correct? >> that is correct. >> you would be willing to submit a copy of those statutes to this committee so that we could then look at those statutes within the purview of this committee and think about ways to fix them so that we could reduce the burden of regulations? >> it sounds like very much a bipartisan effort on this subcommittee. and we would be glad to do that. >> ok. for the rest of the commissioners, who are here, i would just ask for a yes or no answer. would you be willing to also submit a similar list of statutes that your arings deals with that you think could be streamlined so the regulatory process could be streamlined, commissioner adler? >> yes. >> commissioner northrop? >> i have. >> great. i would love to get a copy of that. mr. mcdowell? >> yes. >> chairman? >> yes. >> commissioner. >> my list is the same as john's. >> ok. great. this is a good effort down here at the end of this table. so -- and i wanted to ask you,

commissioner mcdowell, because you had listed off a number of regulations -- numbers of regulations. i don't think that you think that -- first of all, are all those regulations that you listed, i don't know them by heart, are they all duplicative or unnecessary regulations, the ones you listed? >> the number of pages i cited? >> you lessed some different sections. you threw out a whole bunch of regulations. >> the sections i cited were statutory sections that gave us the power to deregulate on our own. then i also listed a form -- >> oh, the form. >> the form. >> just because there's a form doesn't mean that it's per se unnecessary, correct? >> no. and i didn't imply that. >> the numbers of the forms that you listed, are those particular forms unnecessary in your view? >> not all of them necessarily. that's what i said in my testimony. >> that was just a figure of speech that you were talking about, a lot of forms, right? >> i think my testimony speaks for itself. a lot of forms that could be

simplified or eliminated. >> have you compiled a list of regulations for your agency that you think are duplicative or overly burdensome? >> yes, ma'am, it's in my testimony. >> that's the comprehensive list. and has everybody else -- >> not the complete list. >> could you get us your complete list? >> if you would like. >> and we're -- along with our brand new member from colorado, mr. gardner, my neighbor to the north, and others, we're trying to develop bipartisan lergs. and to be honest, as you see from these folks down here, regulatory reform is not a partisan issue. i mean, nobody wants to have overly burdensome regulations. and so i guess what i would ask everybody here from all of these agencies and a list of statutes that you think lead to overly burdensome regulations, if you can give us a list of regulations that your agencies that you think are overly burdensome, that would be helpful, too. commissioner adler, would you be willing to do that? >> i'm speaking only for

myself. but for myself, yes. >> ok. commissioner northrop, i believe you probably have already done it. >> i have. it's part of my testimony but i've also previously sent to the schill a list of changes. >> if you could get that to our staff, that would be great and commissioner mcdowell. >> absolutely. >> mr. chairman. >> yes. >> and commissioner -- >> yes. >> and we certainly will. although we have eliminated a lot of regulations. ongoing regulatory reviews pretty rigorously. >> thank you very much. >> gentlemen from texas, mr. barton, is recognized for five minutes. >> well, thank you. i would stipulate that all the individuals before us are paragons of virtue today. because they're subject to the energy and commerce committee. and that admission makes you a paragon. i think we need to repeat this is kind of a hearing that's unusual in that this executive order that we're asking you folks to comment on explicitly

excludes you. and as we all know in washington, not too many commissioners and chairmen voluntarily comply with things they don't have to. so we're -- those of us that have been around a little bit understand that. so my first question is what should this committee do in the absence of statutory language that would force compliance with something similar to the executive order, should we pass some sort of a statutory requirement that you all do similar things that the president says in his executive order? or should we let the sleeping dog lie? let's try chairman wellinghof. he doesn't come before us too often. >> thank you, mr. barton. i don't have any specific recommendation for you, sir. i think in fact, as i've indicated in my testimony, we

are going to comply with the spirit of it. and in fact have a staff review. and i think our agency certainly has an economic regulatory agency in each and every regulation that we institute, do, in fact, take into account whether rates are just and reasonable and services are and we also provide the industry with an opportunity to fully comment on those regulations. and determine ultimately whether the regulations are burdensome based upon those comments and information that we gather. so i don't have any specific recommendation for you. >> mr. leibowitz. >> i would say this. we comply with the spirit of the executive order. i think it's a terrific executive order. we go beyond it because i think only four of our rules would be sort of within regular flex and we do -- reg flex and we do regular review. i also think it's important to

preserve the independence of agencies, too. and as you can see, you know, agencies provide, by having members not of the president's party, agencies as a sort of institutionalized matter provide checks and balances. and they are independent voices. so i understand what you're saying. because i think you believe that the executive order has a lot of good things in it. and we agree. >> the republicans think what the president says he's doing, we're not sure he's doing it. but what he says he wants to do, we think is a good thing. and so you folks -- say the right words. you're going to comply with the spirit and you agree in general. but the truth is you're not going to do anything unless you absolutely have to. the question is should i get with ms. degette and mr. stearns and put together a bipartisan bill that would make it a requirement? >> well, let me defer to commissioner kavacic because i

know he wants to add something here. >> congressman barton, i quarrel with your suggestion that we do only what the gun at the head compels us to do. i was a junior case handler at the f.t.c. for the first time in 1979. and i think it's been in the d.n.a. of the agency internally, partly because of our structure, partly because we have a large team of economists to do this kind of introspective work. as long as i've known the agency. and i would emphasize that i think what would be very constructive would be two things. first is for us to have perhaps a more frequent conversation in settings like this with your staff about what we do. in 2008 and 2009, we did a comprehensive self-study of our agency. we benchmarked ourselves with 40 of our counterparts overseas. we talked extensively with our counterparts at the federal and state government and we did a substantial publicly available assessment of how we're doing. i think it would be helpful on

one front to have a more extensive continuing conversation with the committee about the measures we do take that aren't obliged. and the second is to go back to something that several of you had mentioned. >> you're going -- i've got 20 seconds and i got one more question. >> the other thing is to -- the design in the legislation itself about what burdens it will impose. >> i want to ask commissioner mcdowell -- i can't let him sit here and not ask him some question. the -- not the hearing but the pending regulation regulating the internet under title two is still pending at the f.c.c., do you have any information for us what chairman janikowski intends to do with that? is he going to withdraw it or push forward with it, what's your view on that? >> sir, just to be clear, the open proceeding to regulate the internet or title two, i don't have any information as to whether or not he's going to withdraw it or what the

reasoning might be for keeping it open. >> don't you think he should withdraw it? >> i do. >> that's the right answer. thank you, mr. chairman. >> i thank the gentleman. the next speaker on this side is mr. green. is recognized for five minutes. >> thank you, mr. chairman. first, i want to take the opportunity to thank all our commissioners for being here. those of us who have been on this committee a number of years realize and welcome back our colleague from kentucky. what you do every day is important. and ensuring the safety suspect health of our sit -- and health of our citizens. particularly consumer protection and everything, ferc, from texas, ferc is very important to what we do in the f.c.c. and of course f.t.c. mr. leibowitz, in your testimony, you discussed the children's online privacy protection rule. regulation or agency promulgated that helps protect privacy of children online.

can you please tell us more about this rule and does it ensure that children are protected while using the internet? >> well, it -- it was a bipartisan piece of piece of legislation passed out of this committee. but we also understand that the internet has changed and technology's changed the way children use the internet dramatically in the last few years. and that's why we actually moved up our regulatory review of copa by five years. and so we're working with stakeholders. we put out a sort of notice of inquiry and we will have proposed copa improvements, draft legislation, we always -- draft rule, we put that out, we take comments again. hopefully within the next few weeks by the end of the summer. >> and i know for all the agencies, it's just an example, there's a lot of concern about agency regulation. but so much of what you do is in response to legislation.

>> sure. >> whether it's new legislation or previous legislation or anything amended. and this is a good example of a rule that frankly is a -- as a father or grandfather now, i can't possibly monitor what my grandchildren may be doing on the internet. but we do need to have some protection from an anti-ity other than just a family. >> -- from an entity other than just a family. >> copa, if you're 12 or younger, you shouldn't be able to give consent to have your personal information go to companies on the internet. you need to have parental consent is a really good one. and that's the bedrock of copa, the law you passed. >> some of us might move that age a little higher. but i appreciate it. >> some of us might encourage you to do that. >> beyond issuing standards required safety such as that, you've done children's cribs, consumer product safety work on manufacturers, organized recalls or moved dangerous products from the market. mr. adler, a recall authority has the potential to save lives, doesn't it?

>> it certainly does, and i believe we've saved many lives. >> in other agency, tools to help consumers, too. for example, the f.t.c. has taken steps against consumer fraud and deceptive practices through its enforcement powers. >> all the time. >> ms. leibowitz, in your understanding that the f.y. 2010, your agency initiated 66 court cases to protect the rights of consumers. how valuable is that enforcement action? >> we think -- we are principally an enforcement agency. we do rules, mostly when you tell us to, but what we really do on both the antitrust and the consumer protection side is go to court to stop unfair deceptive acts or practices. and to stop people who engage in unfair methods of competition. and we have brought a variety of cases protecting privacy, stopping mortgage scams, that's what we do. >> the lawsuits you filed can have real impact on individual lives. is that correct? >> yes. and often in getting redress if we win a case. or if we settle one for injured victims, yes. >> so there is a a positive byproduct of agencies issuing

regulations and enforcing regulations that are based on what congress passes and the president signs? >> absolutely. >> ok. mr. mcdowell, i was pleased that the chairman of the f.c.c. announced that the commission complied with the president's executive order on regulatory review, it's important that review is comprehensive as possible. i'm looking forward to seeing the streamlining of the f.c.c. which i'm sure as commissioners would love to have. given the constant change and the growing competition in the communications market, do you agree that the f.c.c. should be diligent in reviewing potentially eliminating regulations that no longer protect the public interest? >> absolutely. in a comprehensive way. >> the bicentennial -- the biennial review to make sure this is accomplished, correct? >> not for information service providers, etc. >> over the past 10 years the commission has complied with its statutory duty to prepare and submit a by annual review.

-- a biannual review. >> yes, sir. >> do you believe the biannual review requirement should be amended to include other entities? >> i do. >> and would you submit your recommendations for the record? >> it's in my testimony but i'll reiterate it. >> i yield back my time. >> the gentleman yields back his time and the gentleman from nebraska is recognized for five minutes. >> thank you, mr. chairman. let me start by thanking john leibowitz. first of all, i like the little play between the two of you because it signals that you work with the -- both sides and work together and mr. kovacic in the way that you've answered questions, you're telegraphing or telling us that you two actually work together. and i really appreciate that. i think that's the way america expects our agencies to work. so i want to thank you for that. and jon, you're doing a good job. so i like that you're actually -- >> is this a setup?

>> no. there's no comma, but coming here. i like that you're already attacking the issue of finding the regulations that are not very useful anymore. and don't serve the purpose. so good job. that's exactly what my bill that's in a different committee wants every agency, independent agency, to do. and it's not -- it's to provide the flexibility and i want to talk to you, sorry, commissioner northrop. >> ann is fine. >> because we can sit here and say good job on cribs. but it's amazing to me that we're sitting here talking about bicycles and a.t.v.'s and large cars and trucks that, 6,

7, 8-year-olds play with but yet we're regulating them. so you have to admit, mr. adler, there's some absurdity to the law. do you agree with the rules and regulations -- >> i think that congress basically got the law right. and what you're talking about is a mandate that congress impose, not that the commission imposed. but there are always some portions of the law that need to be re-examined. and the issue you raised with bicycles and a.t.v.'s is one of those that we are actually taking a look at. >> in regard to the absurdity of congress' mandate, and by the way, i list this as one of those votes that i thought if i had to take back, we should have really fought harder on this one to make it a better law. so -- so ann, do you have specific requests for us of where we should change that, the consumer protection saist improvement act -- safety improvement act? >> if i was there and i wasn't i would have voted for the law. i expect i would have. when i was being confirmed by senate i read the law.

it seems like such a good law. i was supportive. so many of the senators that the confirmation hearing said we want you to use all the flexibility we gave you to rationalize this law. we believe that bicycles and a.t.v.'s and scooters, it goes way beyond those two. carving them out may make some people happy. but like you say, trucks could play with the axles in those trucks, if they bend, what good are they? but the problem is when you try to -- when we've tried to find flexibility, there just hasn't been three out of five votes for that. so it's going to take a change in the law. the discouraging part is that even the commissioners can't seem to agree how sweeping a change they would support. but we desperately need -- >> do you have flexibility, for example, third party testing? i think there was an incident when this bill was being developed by a toy manufacturer

that manufactured in china that perhaps there was accusations that their data in house was not correct, so if you're a large international company mandating third party testing when you found out your in-house testing was inaccurate, but do it on a 10-person company in omaha, nebraska, on t-shirts where -- on every size and every color, doesn't make sense to me. do you have the flexibility -- >> no, we don't have that flexibility. >> is that an area we should look at? >> it is an area. and today, vast new ways to enforce the law. we track things coming in from overseas. tools that we didn't have in 2008. and i would give the commission the ability, the flexibility to require third party testing where they think there is risk and they think it will be effective to enforce it. it's one of the proposals i have made. it would make a huge difference in the cost of this.

because as you say, every small business is telling us when they have the third party test every single component individually for lead, when they have to then do -- or thiolates or do it to the toy standard, it's extremely expensive. >> on that -- do you guys tried to obtain data, for example, when the third party testers are telling a small company that prints motorcycles on t-shirts that asking that they test the cumulative effects of 10 t- shirts of the same color and size -- produce one piece of evidence that a child has eaten 10 t-shirts. >> the problem is if there is a

daughter of blue paint on that, they need enough blue paint to test to have a quantity of blue paint. i will tell you i have pushed for a component part testing, allowing somebody to -- and i think we are going to pass this, and this is the flexibility that i think is probably the most flexible regulations we have where you can take your blue paint and tested, and then you can put it on every teacher, and you do not have to tear it up. but when you talk about bicycles, for example, that have 141 parts to them, and every time you change the shipment of spokes, the shipment of pedals, you have to have a new test for that, then you have to change the label so it reflects the component test that was used, it is very complicated. >> time has expired. the gentle lady is recognized for five minutes.

>> thank you. i think we all here agree that it is important for regulatory -- regulation to be efficient, and we have to be mindful of the impact on businesses. we all agree that i helped negotiate the bill. very proud of the legislation, but henry waxman introduced legislation that would deal with some of the unintended consequences. i think maybe we as a committee ought to take another look at that legislation, and i know the commission would be willing, as i understand it. i think we ought to look at that. but let me just say, to go back to risk-based assessment, that is what we had before. i think that what we have found is that -- why we regulate, and that is because time and time

again, industry has shown that they are going to police themselves. one of the issues is the industry standard, and we had a press conference with the attorney general in illinois on june 28 when the crib standard went into effect, and i congratulate all of you on that, although i have to say i was disappointed to see the press release that went out that we did not give people enough time when, you had said earlier that you wished it had gone into effect the next day, so that parents could be sure when we put our kids to bed or our grandchildren, that they are going to be safe. so let me ask you -- do you consider the standard to be an example of a victory for the consumer protection improvement act? >> i think it is one of the

finest things that has been done under the consumer product safety improvement act. it is taking children who are our most vulnerable involuntary risk takers because they are there with long periods of time with no supervision, is saying that we have the most stringent safety standards in the world. i think it is a man of this achievement, and i commend congress for directing us to -- in fact, i in your regulation, you did give some places that might have cribs some time to comply. is that not true? >> we did, and i am delighted to respond to the issue that commissioner northrop and i disagree on with respect to independent retailers. we had a group that said we need more time, but we had a group that said, "please do not give more time." we had complying cribs, and we are prepared to sell them now. >> great. i want to mention on the

database -- i had and all that from the german in new jersey whose daughter was injured by a crib in 2007, call the manufacturer and ask if they had any other complaints and was told that there were not any, but actually found out that there were 84 reports to similar problems. fortunately, his daughter was not hurt very bad. the public information database was created by -- because previously manufacturers would not, and they could not share live-saving information with consumers. is that correct? >> that is correct. i think the database is one of the finest pieces that comes from the consumer product safety improvement act. >> do you think that it serves the function of making consumers more aware? >> it is, and i might quickly point out that it is modeled after a similar database at the national highway traffic safety

administration. cars actually have more traffic safety rights, and i think it is a very balanced piece that provides the proper attention to disclosure to protect consumers with the rights of manufacturers to make sure that the information is correct. >> do you think that congress should force the consumer product safety commission to do a full cost benefit analysis every time it takes steps to protect children from harmful products, no matter how dangerous those products are? >> i actually think congress got it right. they did not say regulate with no attention to the economic impact. congress said that when we regulate with respect to children, that we need to follow the dictates of the regulatory flexibility act. one of the things i like about that is it is focused on small businesses. that is the group that we are supposed to make specific economic findings with respect to when we are trying to protect our most vulnerable consumers.

>> i will yield back the two seconds that i have. thank you. >> thank the gentle lady. gentleman from texas, you are recognized for five minutes. >> thanks, mr. chairman. commissioner, it is good to see you here. it is amazing you got confirmed by the senate, so congratulations on that. quite an accomplishment. i apologize for being late. can you give us an idea of the scope of the effect on the retail industry on this crib ban that has now gone into effect? i realize -- i know the commissioner said a cost-benefit analysis was not necessary, but still. >> first of all, the regulatory flux analysis we do -- it is like checking a box. sometimes it is a paragraph. sometimes it is a page. there are small businesses that

will be affected. we will put some out of business, but we go right ahead and regulate. there is no requirement that it be cost effective. what happened with the current standard was that we issued this, and we considered at the request to manufacturers how long it would take for them to get the new qualifying crib's tested, third-party tested, and into the market. six months was decided. we did not think about retailers. one service said they think six months is enough for retailers as well. unfortunately, it took longer to get them developed. it took longer to get them tested. by the time they got them to the retail stores, retail stores -- some of the orders they had placed last november are arrived a week before the new standard took effect. they were not third-party tested. so they were junk to them. how many? when no one group of retailers

that did a survey had 17,000 of them. we know that we call 5 -- not our biggest source, but five major retailers. they had 100,000 as of the first of june. that comes to about $32 million worth of materials that will have to be thrown away, and these are not drop site cribs. these are not even cribs that are not -- they are not identical to the standard. they have not been there-party tested or standardized. the new standards that went in in 2009 was the basis of our crude standard. let me just say, if those are unsafe, why would we have allowed day care centers, the motel/hotel industry leaders -- it is because we did not believe they were unsafe. >> winter of 2000 it was kind of a bleak time on capitol hill.

with no thought to my personal safety, i took a trip to the cpsc and look at the testing facility. it is remarkable in that it is very spartan. >> we have a new one now. three weeks ago. >> an old missile base, as i recall, when i went out there. i was struck by -- the folks there were working diligently and work quite invented and innovative. i actually took a great deal of confidence away from that, but at the same time, i will never forget sitting in a press conference that the people on the youth motorcycle thing put together a few years ago. beautiful little boy in full motocross regalia standing who said, "mr. congressman, if you let me ride my bike, i promise i will not bleed the battery when i am finished." that is the level of absurdity we have reached. >> the testimony is fascinating. during the agency talk about the

dna. the dna of the cpsc is fabulous, but that has all changed because of the cpsia and the rule making we have done in compliance with levels and requirements that are unrelated to this. for years, this agency was risc- based. it worked for the voluntary standards committee, which is very important because products emerge. they evolve. these voluntary standards keep up with these evolutions. any time we did not think they were strong enough, we had the right to intervene, and we did, as my colleagues pointed out. >> briefly, i do need to ask our friends from the federal trade commission the question. if you read the federal register, you maybe aware that there was a health care law signed last year that has caused some of us agree. did you guys participate in the riding of that regulation? >> we participated -- it is

principally itcms, as you know -- principally from cms, as you know. we wrote it with the department of justice. we did the antitrust component, and they are trapped us. we were taking, is. we believe that competition is critically important to health care, not regulation, so what we're trying to do, and we will see. aco's are a brave new world and very uncertain. we are trying to make sure that competition principles remain. >> you give the exemption to major league baseball, national football league, but here's the deal -- the 21st century health care model has been continued, and now, we have a rule that does not work in actuality. the rule -- something that was

working in practice and rendered invaluable in theory, and that is the problem. >> we have certainly -- one of the reasons why we put out track guidance, and again, we have a small component of it. one of the reasons we put the draft guidance and while we are meeting feverishly with stakeholders is we want to make sure that to the extent that there is an uptick, is the notion that you pick up very little efficiencies by putting together, as you know, doctor practices, lab testing facilities, and a hospital. is not a bad one. we want to make sure you do not have one dominant provider so that's it soaks up all the efficiencies. >> what about karen ferguson? >> we just point out that we cannot review the insurance industry. we are exempted from that, but i hear what you're saying. >> the gentle lady is recognized for five minutes. >> thank you, mr. chairman. i want to also add my thanks to

other commissioners for being here. as i listen to the testimony, it seems that all of the independent agencies you represent have been undergoing some regulatory reform, and even though you are not under the executive order, that you have really gone beyond what you had been doing to keep in spirit with the executive order, and i commend you for that. i sat on the small business committee for about 10 years. each of you are coming by the regulatory flexibility act, and so you are required to look at how the impact of your regulations on small business our view. i was going to ask commissioner northrop, my classmate, about the effectiveness, but you have already kind of said that it is not effective. is it the experience of the other commissioners that the regulatory flexibility act does not do enough to protect small

businesses? >> i do not agree with my colleague about the. especially with regard to the impact of the regulatory flexibility act on our agency. i think it has been a good provision. i was just reviewing the regulatory flexibility act, and to me, it is a smaller but focused cost-benefit analysis, and it is something i think the commission has done very conscientiously. >> it is often just a paragraph in a long rule. even if we found that it will impact small businesses, it does not require us to decide it is still with going forward to make any changes to our rules. it had no impact on the rules. one or two maybe, but very few that i can remember ever.

>> there is nothing really the court can do to make agencies change their rules. >> that will be very disappointing. seems as though most agencies -- most of the commissions have had good experience. >> i think that it has some limited effect in focusing our attention on things that are important, but i think there are a number of other things we have done that have tended to be more significant that have come from within, and we would be glad to share those with you at your pleasure. >> thank you. what i have been hearing is that most of the commissions have gone beyond what has been required, and i appreciate that. on july 20, you wrote a letter to the chairman offering several recommendations on how the fcc should be more transparent and fiscally responsible.

and from prior testimony today, we have learned that the chairman has proactively implemented some of the changes to facilitate your suggested reforms. fcc has improved communications by implementing a more user- friendly web site by providing blood stream. you think the website has enhance public participation? >> the website right now is a bit controversial theory depends on the segment of the audience that uses it. >> in general, i think the chairman is taking some discreet steps, but i would like to see more comprehensive reform done. >> the fcc has made efforts to collect broader input from the public, including having more than 85 staff-led public forums and reinvigorating the public advisor committees. do you think these efforts have allowed for an increase in public participation? >> absolutely.

that you have had several workshops on the national board plan to discuss potential reforms to the universal service fund. do you think those workshops have been helpful? >> they have, certainly. >> although the fcc is not subject to the executive order and regulatory reform, they implemented their own look back, which is also included in this statute. this effort has resulted in the agencies eliminated and/or revise and 49 regulations and identifying more than 20 cents a unnecessary data collection requirements for possible elimination. is that correct? >> i do not know. i've not seen the list. i did not know if some were mainly data collection. was focused primarily on data collection, although it has general collection.

but it was the focus of the data collection, not just a comprehensive review of all of our rules. >> our information is that according to regulations, i did a fine may be 20 sets of the necessary data, so it seems to me that the sec cozy current leadership has been successful in implementing new ideas on how to improve current regulations, and i look forward to working with regulation and a continued focus on ensuring public participation and open exchange of ideas that improve the work of our government, and my time is up. >> thank the gentle lady and the gentleman from california. >> mr. adler, you brought up the issue of trying to make sure that we have the safest cribs in the world, as you say. what percentage of the kurds on the market in the united states have elevated platforms or are made of a hard material would/plastic seal? >> i do not know the answer to that. >> would it be fair to say the overwhelming majority have elevated platforms or are made

of hard materials? >> i think that makes sense. >> would you agree that any elevated platform or material that when you have a child, you have the potential for injury because of dropping off the platform or because of some activity that may end up meeting impact with the hard material, so there is a visit with both of those design materials? >> that is an excellent point, in the commission standard is addressed to what we consider unreasonable risks, but i did not think we did make that a fatality-free zone. >> that is the point. what is reasonable level. you could sit and say that because we do not require all troops to be on the ground, we do not require them to be -- we do not require all cribs to be on the ground or require them to be made of soft material, it is not the safest it could be. >> i would agree with that, but what we have done is make the

crib's produced in the united states the safest within the types of technologies that we think that are reasonable -- >> i just think that -- i appreciate that. we make these claims and statements as elected officials or public officials, but it is reasonable guess that is the determining factor, and that is where the judgment issue had to come down. let's talk reasonableness. you recently discovered that the so-called fairness doctrine was still on your books. almost a quarter of a century after it was abandoned. do you think it is reasonable that a federal agency has basically misinformation, if not -- some people may say it is a lingering light of the fairness doctrine. do you think it is reasonable that almost a quarter-century after regulation is not there, it still is being stated as being part of the process? >> i do not think it is reasonable that the language remains on the books of that is

your question. >> what are we doing to make sure that the mistake is not in your regulatory guidelines? where the public and business community can read something and find out -- is it or is it not? >> exactly. the commission opted not to enforce a rule, the rule should disappear from the books. >> let's get back to the fact that the sec has taken nearly 12 months -- i will say this -- i spent decades in regulatory agencies -- regulatoryfcc -- the fcc. i understand when you are trying to take a period of regulation and make it a practical application, but when you have decision making that is delayed for over 12 months, and there's nothing on the books that require us -- or require you to make a decision within a reasonable time, don't you think -- is there anything to make you make a decision in less than 12 months? >> certainly, statutory language helps, but even that sometimes

is not observed. for instance, the video competition we are required to produce every year, the last time i think i voted on one was in 2007. >> in other words, we need to basically tighten it up and also have some enforcement on that. i will just tell you, somebody that builds the light rail system in san diego, we abandoned any federal funding just so we could avoid regulatory oversight, and we build the system under budget and on time because we did not take federal funding. i think that is one of the things we do not talk enough about. people want transit. they want this. they want that. sometimes the most important component to get the public the services you claim you care about is getting the federal regulatory agencies out of the way so you can get the job done. that is why i would just like to stay down the line -- you were talking about hydroelectric. when you are reviewing hydroelectric, are you required

to consider the new project option and the environmental damage done if you do not approve it? things like climate change emissions, pollution, and that kind of thing? are you required to basically look at this and understand that if you do not approve it, it will have an adverse impact because the alternative energy capabilities are going to cause pollution where the hydroelectric is not? >> typically, i think if the no action alternative is truly no action as opposed to perhaps modifying or taking out, and the consequence being that it would be a result of more generation that would be less environmentally friendly, but typically, i think it essentially does not get to that. it is a long settlement process where -- >> but you do not have a specific requirement that you have to consider offsets for shutting down a plant? >> not that i'm aware of. >> that is one of those things

that i think we need to talk about more. when you do not approve of road improvement, you should have to offset the pollution caused by the congestion, rather than always -- we look at the emissions for constructing, but the no project option and the environmental and economic social impact of that needs to be considered, but the environmental impact is one that i find of real hypocrisy. nobody's stopping the project has to account for the environmental pollution caused by not finishing the project. i yield back. >> thank you. i appreciate you holding the hearing. i appreciate the commissioners who have come here to bring this debate and talk about the cost of regulation, especially how it impacts people. when you look at a lot of the intent and what is usually set about regulations that come out, they all sound really good and usually the name of a bill,

you can tell how bad it is by how good the name sounds. it is usually in inverse proportion. as i talk to people -- and our economy is still very sluggish. in many cases, when you talk to small business owners or american job creators, as many of us do, the first thing they will tell you that is the biggest impediment to job creation in america -- federal regulation. all the other things that given the way they can manage, seems like the federal regulations have become the biggest burden to creating jobs in america today. when you look at some of these regulations, you definitely want to see the real impact that they are even achieving some of the results they were intended to appear in many cases, you find out they are not. you look at some of these agencies, and we have had a number of hearings, and i appreciate the chairman having the hearings we have had, and we have seen this pointed out by some of the people implementing

it, the shortcomings of the president's executive order, how it does not really get at the cost of regulation. there was a report that was recently done by the small business administration. it is titled "the impact of regulatory costs on small firms." this really look at how it impacted our small businesses. the people that create the bulk of our jobs in our economy. i guess it is not surprising to those of us who have been to some of these hearings, but they talk about the cost of regulations as a whole to small businesses is over $1.70 trillion. how does that break down? i broke it down for families. over $15,000 per family is the cost to small businesses of these regulations. when you look at the regulations and you look at the impact and how it is not only affecting jobs, it is a major impact costing us jobs, but it costs every family over $15,000, you say, where is the bank for the buck?

i want to ask commissioner northrop. you talk about some of the things you have seen. you have seen businesses actually go bankrupt because of some of these regulations. in many cases, bills that were sold and regulations sold helping the health of children that actually had nothing to do with health and just had to do with some kind of radical policy that somebody had that just made a company go fake rock. can you expand on some of the things you have seen in terms of how these regulations not only impact businesses you have talked about, but how in many cases, there is not even a relationship. >> i will give you two quickly. in the bill that you pass, you have exclusions with the lead limit for electrical products. we have a hole cut out for that. you had an exclusion for and accessible parts, and we have addressed that. you also had an exclusion for

lead where not any could be uxor. i assume you meant for some things to be included in that. i think we discussed nuts and bolts holding the could together. maybe the handlebars of the bike. lead in the handlebars, if you suck on it, and light -- unlike paint, it is trapped in the metal. you cannot suck out the lead. our agency, where if you read the handlebars and less than a molecule, it could not possibly change your blood-lead content. that exclusion that you wrote in the bill -- i the rest of the commissioners decided no. so basically they have found that even though you wrote in the non-absorb ability

exclusion that it applies to nothing. that there's not one material that it applies to. if we had nuts, skews, bolts, things that can't be swallowed, that have small amounts in them that have lead -- excuse me, trapped in steel that those things would have been excluded from this law. it would have made a huge difference. >> i want to ask by a show of hands how many people actually read this report that came out on the impact to small business on regulations. can i get a show of hands? not one person read this on the panel. if i could ask unanimous consent to submit this into the record. >> before we put it -- the minority would like to look at it. >> sure. i'll be happy to. it was a report published in september of 2010 it cites a number of sources but he goes into good detail on sector of breakdowns, also differential between large businesses and small. how they differentially fall

higher even on our small businesses. commissioner mcdonald, can you give us an assessment on the things the f.c.c. did to take into consideration? did they look into and do proper market analysis in your fon look at the impact how that would be on our job creators? >> there was no proper market analysis, no finding of market power. in fact, the order, the neutrality order, says as much, that there was no market analysis conducted. >> see, that's the problem. a lot of these regulations that come down, they have dramatic impacts on job creators. they cost us jobs. yet it seems like the regulators go into their own shell and are oblivious to the actual impact. so hopefully we can shift that course. i appreciate the chairman for having us here and more like it to get our economy on track. thank you. >> and the gentleman, the minority has looked at this. by unanimous consent this will be part of the record. i thank you for bringing this.

the gentle lady from tennessee is recognized for five minutes. >> thank you all for your patience in being here. commissioner mcdowell, i want to stay with you. on that net knew ralt -- neutrality order no market analysis done no look ahead and what the cost benefit analysis was going to be. if there had been that analysis done, do you believe the commission would have gone ahead and issued that order? >> i think so. i think that whole proceeding was outcome based, outcome driven. >> ok. chairman leibowitz, i want to come to you. i'm concerned with the f.t.c.'s food marketing guidelines. i have two grandchildren age 3d and 2. -- 3 and 2. so things of this nature i pay a lot of attention to. you think about the unintended consequences that are going to come forward with this. i think that what you may see

is that an unintended consequence can be seen as hampering free speech, the having a obesity. and one of the things that i have found recently is that the food currently sold through the designed by usda a healthy diet for young children, could no longer be marketed under this proposal. so you claim these proposed marketing -- food marketing restrictions are voluntary, but aren't these government standards going to form the basis for n.g.o. attacks? also talk about what you think -- i think that you could see there should be concern about shareholder actions. quickly, please. >> thank you. well, first, as you know, this was an obligated requirement. we're not the only agency. we do the marketing side. we don't do the science side. that's the agriculture department, the c.d.c. and the

f.d.a. but it was a sam brownback, tom harkin obligation in our appropriations bill. we are obligated to do what congress tells us to do. it's voluntary. there's no we're taking comments from stakeholders. and you recognize as we all do there's an obesity crisis. and there are twice as many generation ago. only for myself, i try to take a sort of pragmatic approach here. if my kids eat special k with yogurt in the morning which wouldn't quite meet the nutrition guidelines, i'm pretty happy. because you know what? i think that's better than what else they might eat or better than them not eating anything at all. understanding is that within the next week -- first of all, we'll be getting comments, reviewing those comments seriously from stakeholders. understanding is that the food will come

up with some proposed standardized or uniformed guidelines. guidelines that are good, and i think they then we ought to take that into account going forward, members of the working group. and we will. >> let me shift gears with you. i want to go to the privacy issues that are out in. -- there. and we know that the internet, online advertising is really an economic engine in this country. and the industry is beginning to voluntary -- voluntarily enter into some self-regulatory structures. do you believe the f.t.c. should impose a top-down technology mandate on the internet governing the privacy issue? last thing we want to do. no. thank you for that. i appreciate that. i think that just as i said with chairman mcdowell, if you were to look at the net neutrality issue, if there had been a robust review of cost benefit analysis, i think it would have been determined that the net neutrality order,

especially paragraph 84, was going to be debtry meantal to our -- detrimental to our economy and i think a heavy hand on the issue like wise. i have less than a minute. i want to ask a show of hands, how many of you have read executive order that we are discussing and have been through the process of reviewing that? a show of hands. ok. so all of you have. all right. how many of you disagree with any part of that order? is there any part of that order that you have disagreed with? yes, sir? go ahead. >> i think a number of the provisions aren't very well specified. think it could have benefited from a much polar discussion about how it intended specific tradeoffs that are implicit in the order were to be made. there's been subsequent guidance, subsequent

commentary. >> anyone else? commissioner? >> i agree. i think it could be broader and more comprehensive and more aggressive. >> ok. any other addition to that? patience. know we've been morning. we appreciate it. yield back. >> gentle lady's time has expired. mr. griffith? recognized for five minutes. >> thank you, mr. chairman. so i can see everybody better. commissioner mcdowell, it's nice to be able to say that in a formal setting, in my new role. look at the merger review process under republican and democrat administrations, i see a process that appears to be broken. x.m. and sirius merger took too long, the comcast merger took too long. there's too much discretion for the commission to halt the timeline for the review of the transfer of control of licenses in an expeditious manner. is there something we can do to

provide applicants with certaintyity regarding the timing of the review process? >> and congressman griffith it feels good to say that as well. my first time saying that publicly. so congratulations. yes, the f.c.c. has -- f.t.c. -- f.c.c. has a clock get mergers done. i read yesterday that the assistant attorney general for antitrust is stepping down. there's a big merger of the at&t mobile merger that needs a fair, thorough and expeditious review. and i would hope that her stepping down doesn't delay that. i think we could get that done by the end of the year. in a fair, thorough manner. but i've been in a dialogue with chirm general kowske about making sure with chairman

genowokowski. both republicans and democrats, the way they've conducted themselves in taking too long or position that have nothing to do with the substance of the merger itself. so congress could look at that, there could be a statutory provision, certainly. but the best thing to do would be for the f.c.c. to honor its own 180-day shot clock. >> we do from time to time work with the f.c.c. on merger reviews. think from our perspective, you don't deserve a particular outcome but you do deserve a sort of speedy resolution. sometimes it takes a little longer with documents. but that's what you deserve. so i think that's a reasonable point. >> i agree. >> i think most of us would agree with that as well. >> commissioner, do you think congressman waxman's proposed legislation will actually ease any burdens under the consumer product safety improvement act? >> no. i don't think it he goes nearly far enough. in fact, he has proposed previously a functional purpose

exemption which i have to say is like picking winners and losers. if you think -- first of all, it says it can't be harmful to children. then it says if it serves the function, for example on the bicycle is necessary, then we can exempt it. well if it doesn't harm a child, why do we have to then exempt it in part by part? it means that big company that have lots of product or big, expensive products can afford to get a functional exemption because it's a very complicated petition would you have to file with us. they can afford to file the petition, all the supporting work and everything. and then we can exempt them. but for small needs, for these same exact materials that do not harm a child, i don't think , you know that they probably would be able to afford either the weight for us to act on it or the cost to put the petition together.

so that in particular to me, you know, is not a good way to go about easing this. making the observing ability a useful exception would make a huge difference. >> did you want to add on to that. i wanted to disagree. >> somebody else may give time to do that. i've got one more thing to say because i'm running out of time. i did hear from several of you as i was lessening to this testimony that you all, at least a couple of you, made mention that perhaps the legislation created more of the problem than i think both you and you, commissioner. the legislation created more of the problem than the agency created, and that we should be careful when we craft legislation that that may be costing jobs as well as the regulations cost jobs that are ultimately awarded.

while in some cases it may be an agency that's pushing the envelope in some cases it's just the agency following exactly what congress told them to do. i do appreciate that. i yield back my time. >> the gentleman yields back the balance of his time. gentleman is recognized for five minutes. >> thank you, mr. chairman. thank you for your time and testimony today. chairman, in developing energy policies such as policies to support the integration of renewables, demand response, or the deployment of smart grid technologies, does ferc evaluate the impact of that increased energy price resulting from the implementation of these policies having on jobs? >> the policy that we implement aren't directed to specific technologies but rather are directed to the integration of all technologies into competitive marketplace. we believe, and i think my

colleague would agree, we believe that competition is good for consumers. so to the extent that we can maximize competition, we can increase the types of resources that are available in the market whether they be coal, or nuclear, or natural gas, or solar, geo thermal, hydroelectric, or anything of these resources. and also to the extent that we can do things like incorporate in demand response and energy efficiency which are usually the lowest cost resources. the whole mix of those resources in a competitive environment allowed to compete fairly in that competitive environment will, in fact, produce the lowest cost for consumers. >> so do you do an analysis that these policies, the impact they will have on jobs? >> we don't do a specific

impact. >> so you don't do a jobs analysis then? >> we don't do a specific analysis >> a specific analysis on jobs. you do not do a specific analysis on jobs. >> we don't. but we do believe -- excuse me. if i could finish. >> actually, i'm reclaiming my time. in terms of the executive order . so you do not believe that the executive order, which i think you said you believe in the spirit of, you do not believe that it requires you to look at jobs. i understand that you're exempted from it. but you said -- you want to follow the spirit of it. do you think you ought to be concerned about jobs and looking at the job impact? >> i think we are always concerned about jobs to the extent that we can drive down prices in a competitive atmosphere and allow nor -- for the economy to have access to low-cost power. to the extent that we can provide low-cost competitive power within the economy we are going to create jobs and maintain jobs. >> but you don't do an analysis to know that or not.

>> my basic economics is what i know of basic economics, tells me if we can lower costs for electricity, we're going to have the ability to increase jobs. >> did they start beginning jobs analysis when you make decisions? >> i certainly have no problem looking at jobs. i believe, for example -- >> but shouldn't we -- shouldn't that be our intent? >> the colleague from louisiana, for example, was talking about this issue with respect to jobs. and regarding that, intergi, one of the utilities in atlanta, has chosen to join a competitive market. an analysis was done that by joining that competitive market something over $700 million could be saved. i think there's a lot of money. if you can take that money and of is it for louisiana consumers and others throughout the region -- it wasn't just louisiana. but spread throughout the region that additional money in the pockets of consumers is

going to help them create jobs and invest back in the economy in the ways that more jobs will be created. so i think that's a very valid example of the types of things that ferk is doing to the regular -- ferc is doing to the regulations and the competitive structures that we're putting in place to ensure that, in fact, we can create more jobs. >> and then so what you're telling the committee -- i believe what you just said, though, when it comes to developing energy policies like integration of renewables, demand response for the deployment of smart grid technologies, then you are saying today that you will do a jobs analysis on these decisions. >> i'm saying to the extent that it's possible to do so we certainly will in fact, look at the impact on jobs. >> i think we ought to be looking at the impact on jobs no matter what we do so that we have an idea. >> i absolutely agree. >> so commissioner, do you care to comment on this? >> generally i want to associate my remarks with the

chairman because we're believers in competitive wholesale markets and that those are ultimately what benefit consumers the most and allowed more resources. i think we should always be cognizant of the employment impact we have on rising energy prices. because it can be substantial. >> thank you, commissioner mueller. see my time has expired. i yield back. >> i thank you the gentleman for his questions. i think we're completed with round. the chairman, chair lady and i have talked. we're going to ask a few more questions and then wrap up. i don't think ever in my experience has there ever been such a distinguished group of people that could make an impact on deregulation in america as you folks today. so we are here with a certain humility and asking you, what is the best way for us to move forward. is pointed out with the small business administration report, had every u.s. household paid an equal share of the federal

regulatory burden, each household would pay $15,, 586. that was in 2008. when you compare that with what we spent for health care costs in 2008, the federal regulatory burden exceeded by 50% the private spending on health care which equaled 10,500. so it's within your power to deregulate and to get rid of burdensome regulations which would spur the economy. so we're not talking about something insignificant. so i guess the larger question is, we passed in 1980 the regulatory flexibility act. obviously that's not applicable today. and it's not working. so the question is for you, sort of a wrap-up understanding , the president reached out with his executive order, did not apply to the independent agencies in some of your opinions. we don't seem to have you jumping to the forefront to try to deregulate.

should congress through either statutes or legislation provide, one, either more flexibility to you? or should we update the regulatory flexibility act 1980 so we're reaching out for you to tell us, one, should we do some of the things i mentioned? and secondly, would you be willing to help us in terms of provide -- or providing us documentation in what we should do? i'll start with my last. >> mr. chairman, the devil is always in the details. i would be delighted to look at anything you drafted and to respond to it. >> so you think we should take the regulatory flexibility act of 1980 and update it in congress? >> actually, i'm probably a bigger fan of the act than some folks here. as a read it, i think it's a fairly useful tool. especially in terms of what we do. and wheer trying to regulate. and we're looking in particular the impact on small business. that is actually something that both commissioner northrop and i agree on, that we do have to worry about the impact on small

business. >> and commissioner northrop? >> yes, but unfortunately it has no teeth in it. no matter what the regulatory analysis is, if you decide in our agency that you should go heed and regulate -- go ahead and regulate, it almost has no impact in what we do so unless we're required to justify the costs with the benefit, adding that to it, i think that would be an important improvement. but other than that, it's a box we check. it doesn't have an effect. >> just for your information, i checked the consumer product safety. everybody in congress voted for it under the bush administration except one. that was ron paul. so you probably would have been like most people. >> i'm sure i would have. you know, like i said when i first read it, before my confirmation, i was really very excited about it. >> sure. commissioner mcdowell? >> i think statutory action is the best way to cut through

this cord and not regulation and statutory provision that have built up through the years. i would be happy to work with you through something like that. >> chairman stearns, as a indicated to congressman, i don't have a specific recommendation for you. however, certainly anything that the committee decided to draft, weed be happy to work with new any way. >> commissioner mueller? >> mr. chairman, i jernly -- generally think the government of legislative and regulatory body should periodically review legislation and regulation. so if that's in order, i certainly endorse that. and as our chairman said, i had a specific example about hydropower relicensing. i'd be happy to provide it to you. it would be quite complicated given the number of federal laws involved. but any help that we can provide, i'd be happy to do so. >> also happy to work with you. though as pointed out, i think only four rules that we have actually are within reg flex.

but we do, do, you know, reg reviews and rule reviews. in fact, we're in the middle of 23 of them now. so i'll refer to my colleague. >> mr. chairman, if i could underscore a couple of themes. one, the enormous value of having committees in the congress as a whole assessed before the fact, the likely impact and regulation writing of legislative -- legislation adopted second. the custom you're developing in this hearing, making a regular question for all of us, how much are you spending in each budget cycle to look at evaluation and the assessment of effect? not just to measure accomplishment by activity itself, but look at actual impacts then to press us by asking how much are you set ago side in each budget cycle to do this? and last, we do an enormous amount of work as advocates for competition and better consumer protection tech fleeks, before the government agencies before state governments. this, perhaps, provides specific suggestions that we'd

be happy to share with you about how adjustments and national and state legislation could improve productivity, improve economic performance. >> i'm going to let the ranking member. but i think each of you have indicated you will help us. are you saying something should be done? so i'm going pre-suppose that all of you will submit to us some specifics that we can incorporate and start working as the energy and commerce towards this. the gentle lady from colorado. >> thank you, mr. chairman. i agree. i had asked for that information earlier. i really look forward to working with all of you. as we all said, you know -- actually, it was one of you said the devil is in the details of these regulations. you can say we're all for regulatory reform. we also probably need to streamline some of the statutes. a lot of the regulations fall from the statutes. i think we need to look at all of those. i've been sitting up here

thinking about this standard with the cpsia. i was on the conference committee with chairman barton and others. mr. chairman, you're exactly right. there was only one no vote on that bill in the house. and chairman barton and ranking member waxman and a bunch of us , even the other bodies sat around for a long time trying to figure out what to do with this standard. i remember it so clearly. when we drafted the new standards what we decided was that determining total lead content was preferable to risk assessment. because what happened with risk assessment is it was dependent on a product by product determination which you couldn't do because of the large number of children's products in the marketplace. and so in addition, although with most chemicals, a traditional risk-base model can work. if you have persistent,

accumulative talks, like lead, science demonstrated traditional models are inappropriate and exposures inevitable. and we spent a lot of time in that conference committee talking about what we do about bikes and a.t.v.'s and things like that. so it's not like congress never talked about these things. i think what we need to do now that we've passed -- and it wasn't one of these provisions slipped in in the middle of the night either. we really, really hammered this out on a biparticipate -- by partisan basis. so now given the experience that the cpsc has had in trying to draft the regulations is sit down and figure out what about that new lead standard might work, what might not work. and this is what lead to this effort by then chairman waxman last year to develop this legislation everybody's been talking about. the staff undertook a consul

take thive shareholder process with small business and others to try to figure out what we do about the a.t.v.'s, the bicycles, the t-shirts with the blue ink and things like that. he did release a consensus discussion draft of a document to try to figure out how to address these concerns because we need to do it. but unfortunately, your side of the aisle, mr. chairman, rejected that. and so, you know, we can sit down and talk about it. we did do that. we did that when the republicans were in the majority in the congress and when we had president bush and the white house. but we can't divulge to the stage where we say, ok, we're the majority, we're going do it our way and to heck with you and vice versa. we really need to work together on how to make this work for small businesses and most importantly for consumers. so that would just be -- as someone who has fortunately or unfortunately been in those trenches, sometimes these

regulations actually came from some scientific basis. and it's going to take some really hard work to fix it. i think every witness here would agree with that on some of these harder regulation that might be more burdensome. and just one last thing, mr. chairman. ms. christianson was asking a question about the chairman's efforts to eliminate outdated and unnecessary regulations at the f.c.c. and he had sent a letter to the subcommittee to you and to me outlining the efforts which noted that they eliminated 50 outdated regulations and identified 25 sets of data collection that are no longer necessary. so, chairman, i'd like to ask unanimous consent to put that letter into the record. >> the gentle lady, let's take a few moments to review it. >> sure. >> what is the date of this? i don't see the date on this.

>> it's today. >> it was today's date. ok. >> i would say at this point there's some concern that is really perhaps -- some of it is applicable. but to others, there's concern on this committee, as we talked about earlier, the fact that the chairman was invited to come here. he said he could not come so it's customary if he doesn't come, we do not respectfully take his statement opening and put it as part of the record since he didn't show. we're a little concerned that this might, in fact, be part and parcel of his opening statement. so i think -- >> mr. chairman, i i would just point out it's not an opening statement. it's a letter to us that we

generally -- >> i think the staff is interpreting as an opening statement. so i'm just saying at this >> [inaudible] >> at this point we're not able to rule in favor of that. so i think we're just going to hold off and not put it part of the record. at any rate, i'll close by saying that civilizations rise and fall because of burdensome regulation. it's in your hands, you people, to do as much as you can to make the small businessperson succeed so that we can have the innovation in this country. i thank you for your time. the subcommittee is adjourned. [captions copyright national cable satellite corp. 2011]

>> the president and congressional leaders discuss the latest unemployment figures and negotiations over the federal budget. a house hearing examines potential changes to social security. and british prime minister david cameron holds a news briefing to address the news of the world phone hacking scandal. >> according to the labor department's monthly jobs report released today, the unemployment rate rows to 9.2% and the economy added 18,000 jobs in june. at the white house president

obama addressed the unemployment numbers and the economy and discussed negotiations over raising the federal debt limit. >> good morning. the debate in washington has been dominated by the issues of debt limit. but what matters most to americans and what matters most to me as president in the wake of the worst downturn in our lifetimes is getting our economy on a sounder footing more broadly. so the american people can have the security they deserve. that means getting back to a place where businesses consistly grow and are hiring, where new jobs and new opportunity are within reach, where middle class families once again know the security and peace of mind they felt

slipping away for years now. today's job report confirms what most americans already know. we still have a long way to go and a lot of work to do to give people the security and opportunity that they deserve. we've added more than two million new private sector jobs over the past 16 months. but the recession costs us more than eight million. and that means that we still have a big hole to fill. each new job that was created last month is good news for the people who are back at work. and for the family that they take care of. and for the communities that they're a part of. but our economy as a whole just isn't producing nearly enough jobs for everybody who's looking. we've always known that we'd have ups and downs on our way back from this recession. over the past few months the economy is experienced some tough headwins from natural

disasters to spikes in gas prices to state and local budget cuts that have costs tens of thousands of cops and firefighters and feachers their jobs. the problems in greece and in europe along with uncertainty over weather the debt limit here in the united states will be raised have also made businesses hesitant to invest more aggressively. the economic challenges that we face weren't created overnight, and they're not going to be solved overnight. but the american people expect us to act on every single good idea that's out there. i read letter after letter from folks hit hard by this economy. none of them ask for much. some of them pour their guts out in these letters. and they want me to know that what they're looking for is that we have done everything we can to make sure that they are

rewarded when they're living up to the responsibilities, when they're doing right by their communities when they're playing by the rules. that's what they're looking for. and they feel like the rules have changed. they feel that leaders on wall excrete and in washington -- and believe me no party is exempt -- can let them down. and they wonder if their efforts will ever be reciprocated by their leaders. they also make sure to point out how much pride and faith they have in this country, that as hard as things might be today, they are positive that things can get better. and i believe that we can make things better. how we respond is up to us. there are a few things that we can and should do right now to redouble our efforts on behalf of the american people. let me give you some examples. right now there are over a

million construction workers out of work after the housing boom went bust. just as a lot of america needs rebuilding. we connect the two by investing in rebuilding our roads and our bridges and our railways and our infrastructure. and we could put back to work right now some of those construction workers that lost their jobs when the housing market went bust. right now we can give our entrepreneurs the chance to let their job saving ideas move to market faster by streamlining our patent process. that's pending before congress right now. that should pass. today congress can advance trade agreements that will help businesses sell more american-made goods and services to asia and south america. supporting thousands of jobs here at home. that could be done right now. right now there are a lot of middle class families who sure

could use the security of knowing that the tax cut that i signed in december to help boost the economy and put 1,000 in the pockets of american families, that that's still going to be around next year. that's a change that we could make right now. there are bills and trade agreements before congress right now that could get all of these ideas moving. all of them have bipartisan support. all of them could pass immediately. and i urge congress not to wait. the american people need to us do everything we can to help strengthen this economy and make sure that we are producing more jobs. also to put our economy on a stronger and sounder footing for the future, we've got to rein in our deficits and get the government to live within its means while still making the investments that help put people to work right now and make us more competitive in the future. as i mentioned, we've had some

good meetings. we had a good meeting here yesterday with leaders of both martz in congress -- parties in congress. and while real differences remain, we agreed to work through the weekend and meet back here on sunday. the sooner we get this done, the sooner that the markets know that the debt limit ceiling will have been raised, and that we have a serious plan to deal with our debt and deficit, the sooner we give our bidses the certainty they will need in order to make additional investments to grow and hire, and we'll provide more confidence to the rest of the world as well so that they are committed to investing in america. the american people sent us here to do the right things not for party but for country. so we're going to work together to get things done on their behalf. that's the least that they should expect of us. not the most that they should expect of us. i'm ready to roll up my sleeves over the next several weeks and

next several months >> know that people in both parties are ready to do that as well. we will keep you updated on the progress that we're making on these debt limit talks over the next several days thank you. >> how was the meeting with mrs. pelosi? >> it was good. >> are you on the same page? [captions copyright national cable satellite corp. 2011] >> at the capitol house republican leaders also discussed the economy and the unemployment. this 15-minute press briefing begins with house speaker john boehner. >> after hearing this morning's jobs report, i'm sure the american people are still asking the questions where are the jobs? the stimulus spending bing, excessive government regulations, and our overwhelming debt continue to hold back a job -- job creators

around our country. tax hikes on families and job creators would only make things worse. and to help our economy get back on track, the house has passed several bills that would remove government barriers to private sector job growth. we're going to vote on two more bills in the weeks to come. and we hope the senate will take those bills up. we also need to stop washington from spending money that it doesn't have. we need serious reform that restrain future spending. you've heard me say before a debt limit increase that raises taxes or fails to make serious spending cuts won't pass the house. we hope our democrat counterparts will join us and seize this opportunity to do something big for our economy, and, frankly, for our future and to help get americans back to work. >> good morning. there's a lot of talk about progress that we are having and hope to have around these

negotiations at the white house. and i know a lot of questions that were asked about why did the biden talks end. if you look at the jobs report, and the results of current policies and where we are in this economy, that's why the biden talks had to end. the discussion in those talks turned to the other side insisting that we raise taxes. now, it just does not make sense for americans to suffer under higher taxes in an economy like this. as the speaker said, there is no way that the house of representatives will support a tax increase. >> good morning. a city of history. a lot of history is being made unfortunately as the unacceptable history to this country. today marks 800 days since the senate even planned a budget,

passed a budget. if you look at the numbers today, unacceptable. as a small business owner, this started when he was 20 years old, you look at the country today and i wonder if i would have made that same decision today if i was 20 years old. this is a time to change. the policies of this administration has to change. the policies of this democrat-controlled senate. you have nine bills that have passed the house. estimated more than millions of jobs. you're talking 15,000 in the last month. america deserves better. we deserve a change to go forward. this is not a time to talk about raising taxes. it's a time to talk about reforming taxes. lowering them. creating an incentive where people want to invest in this country again. not only do we have the jobs number. you have in the last 12 months the lowest number of start-ups in a decade.

i hope the president reads these numbers, looks at what he said in 2009, that he would look to the future of the next three years of where jobs would be. his policies have failed. it's time for a change. and the rhetoric of where he's going on the debt limit needs to change as well. >> another month and another disappointing jobs report. 29 straight months of 8% plus unemployment when the president told us we'd pass his stimulus plan, we would never have unemployment above 8%. the president always tells us he inherited a bad situation. i can see the point. but he has made it worse. and after 2 1/2 years it is time for him to take responsibility and to answer the question, where are the jobs? the president's stimulus

programs, tax increases, and class warfare rhetoric created jobs in america, then we'd be the most highly employed society in the history of civilization. clearly we are not. house republicans have passed jobs bill after jobs bill after jobs bill that would help create the confidence necessary for job creators to create jobs, and yet they languish in the united states senate, a body that is very good at meeting. a body not so good at acting. house republicans plan for america's job creators. it is all about ending the era of trillion dollar deficits. it's all about making the tax code fairer, flatter, and simpler. killing off job-killing regulations and ensuring that we can have american energy made in america for americans. >> this administration has this

economy in an idealogical headlock. and the economy is begging for mercy. 9.2% unemployment based on 29 months of consecutive failure is completely unacceptable. what's got to happen to turn this around is the white house has to reflect on its failure, has to acknowledge its failure, and ultimately say, look, there has to be a better way forward. the better pathway forward is the nine bills that the house passed. the better way forward is to seriously take up a budget. the better way forward is to end the nonsense conversations about raising taxes on american job creators. >> the jobs numbers that were given this morning punctuate the lack of focus by this administration on truly giving america what it needs. when i go home on the weekends and i talk to those job creators what they're reel from and suffer from is this lack of

focus. if you look at several of these bill that are up here, they're energy bills. in a state like south dakota where it's a long ways to get anywhere, energy is extremely important. now, we have pushed these bills recognizing the fact that a job creator's need to have affordable energy, they have to be able to utilize low costs in order to put people back to work. and they need the certainty that these bills would deliver and provide jobs to americans as we do it. they have gone to the senate and have done nothing. this administration, this president is still defending a failed stimulus package while he talks about raising taxes. if you talk to anybody who has common sense, if you talk to anybody who's run a business before, they recognize the fact that you cannot raise taxes in a time of uncertainty because it takes more money out of your pocket that you need to go out in and reinvest in your business and put people back to work. our jobs creators absolutely need to know that they have a certainty going forward, that we're not going to raise their taxes. we're going to give them

freedom from some of the burdensome regulation that this administration has given them. and we're going to give them the ability and the tools to go forward to put people back to work. >> the house continues to build on its record of job creation while the senate continues to do nothing. late last month we passed the jobs and energy permitting act to build to design to help unleash american energy creation. the purpose of the bill? energy security and job creation. 54,000 jobs would be created by h.r. 21, the energy and jobs permitting act. 54,000 jobs. as much as one million barrels of oil a gay -- day could be accessed. that's enough oil to replace our imports from saudi arabia. 54,000 jobs. and yet the senate does nothing. i've held over 36 town meetings since being elected on november 2. people continue to talk at every single one of them about the harm that high gas prices are doinging to their families. what it's costing their businesses.

and how this economy's stagnation is continuing to prevent them from hiring new people and creating expansion opportunities for their businesses. it is time that this country start drilling for american energy and stop drilling the american economy. >> good morning. one of those bills that's holding up job creation on the regulatory side is h.r. 872, the reducing regulatory burdens act of 2011. it fix as a bad court decision. without 872 businesses and municipalities would be crippled with unnecessary red tape and higher costs that provide no additional health or environmental benefits. these are higher costs equaling less jobs. additionally, the e.p.a. will be overwhelmed with redundant and dupe la cative permit applications from hundreds of thousands of farmers, public health officials, and everyday citizens. with the unemployment rate at 9.2%, apparently still going up, we cannot afford to make an

already slow permitting process that stifles economic growth and job creation even slower. we are sent here to do the people's work. our plan to restore jobs, restore the confidence in the private sectors, create economy and create those jobs to make those investments. as a freshman congressman it's been frustrating to me that we have a plan for jobs, and passed job creating bills, passed h.r. 872, passed a budget, and we got more in the pipeline to send over to the senate, and the senate has failed to acted. the senate needs to depo its -- do its work and restore the confidence and make those investments, and get the economy going, get people back to work. thank you. >> how does this job report change the equation of getting a debt deal done? does it add to the urgency of coming to an agreement or does it make it more difficult to get people onboard for an agreement? >> i think the situation we face is pretty urgent. i think would describe it as dire.

we have three really big problems. we have a spending problem. we have a debt problem. and we have a jobs problem. that's why i believe that it's important for us to fundamentally fix our spending problem and our debt problem and to help get our economy moving again. >> when you talk about what's going happen in the senate, do you anticipate coming back and saying we have framework for something? that can you present to your conference, democrats to their caucus? >> there is no agreement in private or in public. and as the president said yesterday, we are this far apart. it's not like there's some imminent gsh a deal -- a deal about to happen. now, there are serious disagreements about how to deal with this very serious problem. >> speaker, there have been talks of a big deal package, $4 trillion, $2.5 trillion

package, or a $1 trillion. what do you think the goal should be at this point when you're coming so close to the august 2 deadline? >> i have wanted all through this pross yes, sir -- process to do what i describe as the big deal. that would fundamentally solve our spending problem and debt problem in the near to medium term. but at the end of the day we've got to have a bill that we can pass through the house and the senate. this is a rue by cube that we haven't -- rubix cube that we haven't worked out yet. >> on the pending free trade agreement, do you expect the administration will send out the trade deals in a package with the trade adjustments or it will back down and send only the f.t.a.'s as you all said you preferred? >> i have made it clear to the president and the white house that -- [inaudible] should move on its own. we expect to move four separate

bills. i hope they heed our advice. >> would you combine them after for fast track? >> no decisions. >> mr. speaker -- >> the constitutional lous for the house to make the first move on appropriation and taxes. so if there's no deal, how about moving forward with a plan b, your own plan, sending that over to the senate? >> very nice. very wise of you, allen. [laughter] it is an option. [laughter] we appreciate your advice. want to come up here? >> to get to $4 trillion, you'd have to take some big waks at benefits, social security, medicare, and democrats would have a real problem with this. what can you offer them that would reveal that would allow them to vote for something that would make it very difficult for them? >> do you have any ideas? you can pass them on. >> mr. speaker -- >> how about $1 trillion in

closing loopholes? >> we've got a serious challenge facing the country. in addition to the three challenges i outlined, we're up against the debt limit. and while some think that we can go passed august 2, i frankly think it puts us in an awful lot of jeopardy. and puts our economy in jeopardy, risking even more jobs. so i believe it's important we come to an agreement. but it has to be an agreement that really does fundamentally change our spending and our debt situation. >> last question? >> given how far apart you describe yourself as being, what do you hope will come out of the meeting on sunday? >> i don't know. there are a lot of conversations continuing. but in all honestly, i don't think things have narrowed. i don't think this problem has narrowed at all in the last several days. thanks.

[captions copyright national cable satellite corp. 2011] >> house minority leader nancy pelosi met with the president to discuss ongoing debt and budget talks. after their meeting she spoke to capitol hill reporters at her weekly briefing. this is 20 minutes. >> good morning. welcome to our regularly scheduled thursday morning press conference -- press availability. it's, what, day 185 of the republican majority in the congress and we still have not seen one jobs bill come to the floor. this is obviously reflected in the jobs number this morning. we must -- we have put probably -- i don't know, 20 job initiatives on the floor. and the republicans have rejected every one of them. 10.

10 votes on job creation measures. and they voted no each time. some of those on more than one occasion. that's really unfortunate. i'm so pleased that this morning the president talked about infrastructure. it's something that starting with the recovery two and a half years ago that democrats have been pushing. and now more needs to be done. the president referenced some bipartisan legislation to that end. i hope that our republican colleagues will consider that. people are crying out there, literally crying out there, for jobs. i also want to point to some of the austerity measure that are real or imagined that may come from this -- are we calling it a grand bargain? perhaps a grand bargain. the debt talks. and that we can't do harm with that.

whatever cuts we need to make, we have to do so in a way that does not harm our economic growth. you see with some of the austerity measures already done in the laying off of public employees across the country. that will only get worse. if we continue down the path that is insensitive to the impact of cost shifting to the states in order to reduce the federal budget. so whether it's authorizing job creation, especially through infrastructure and infrastructure bank. whether it is how we budget, sensitive to job creation. growth. we all agree it's essential to bringing revenue to the treasury. where do we stand on all of this? as you know, we had a meeting at the white house yesterday. bipartisan. we have talked since then about some level of optimism that

emerged from that meeting to enable at least to schedule -- the president to schedule a meeting on sunday late in the day to see where we are on something that would have the elements of in their words, grand bargain. i wish we could be thinking about a grand vision. but whatever you want to call it, how we go forward to not harm the economy, to reduce the deficit, to create jobs, to educate our children, and to have a decent retirement for our seniors. this morning i had the privilege of meeting with the president and the vice president on this subject so that we have a clear understanding as the president has met with all of the leaders , a clear understanding of what our terms of how we go forward. and some of this will come forward on sunday evening. but the questions that i have

relate to the baseline, the length of time, the firewalls. some of the technicalities of the discussion so that we're not changing the rules in the middle of the discussion. and so with that i just came. and my apologies for running even later than late. from the usual lively discussion in our caucus where our members were very definite. let me say their enthusiasm was such that many of them stayed around after votes to participate in this caucus, almost unheard of. but they did on a friday afternoon. they're as firm as ever on what it been saying, which is we want to, of course, reduce the deficit as we grow the economy. we are not going to reduce the deficit or subsidize tax cuts for the rich on the backs of

american seniors and working families. no benefit cuts in medicare and social security. we have serious concerns also about what is happening with medicaid as well. so though i think talking it through and people understanding more about what the possibilities are has been constructive. and i'm still optimistic that we can find a place where we can come together. i don't like to have a situation where we're saying, well, you need our votes so you better have this in the bill. no. this is a big deal. this is 10 years. this isn't a six-month c.r. it's a 10-year bill. we want to work together to have something that has biparticipate -- bipartisanship, balance, consensus, broader than enough democratic votes to put something over the top that most people don't want to vote

for. it has to be reflective of our values. because 10 years in a budget makes a very serious imprint on the future. the decisions that will be made in the next few days up until august 2 will determine what the future will look like depending on decision that we make. about, again, taking it to a higher plain of the dignity of the retirement of our seniors, the opportunity for jobs, for our working families, the education of our children as we reduce the deficit. yes, sir? >> just came from a lively discussion in the caucus here what are you hearing from your members when you talk about, say, preserving these values with these entitlement programs but at the same token making alterations to them that may be part of the brand bargain? changed c.p.i. which was quoted in meeting. are members getting it or are they drawing a line in the sand

saying this is a fancy word for cutting benefits? >> no. cutting benefits is exactly cuty that, cutting benefits. we try to affect it in the health care bill. not to get too technical about it, but giving the secretary ability to negotiate for lower prices. if that is part of a global brand plan, we want assurances that the money will be put back into medicare. members can make distinctions, obviously. we don't want anybody to think

that because the pharmaceutical companies got off easy in the health care bill, it is opening the door of weakening medicare. it is opening the door of strengthening medicare. >> how much resistance from some of your progress as did you get in the caucus for uttering the words "cuts to medicare." >> i never uttered those words. [laughter] no cuts to medicare benefits. in our caucus is the verse in many respects. philosophically, generation away, i said that when i went to the table yesterday morning at the white house, i come here and a very special way because i represent a caucus that 100

members are either women or minorities. that is more than 50%, and so we know firsthand the impact of changes in any of these initiatives to communities, individuals, people that depend on social security, medicare, and medicaid. women overwhelmingly dependent on social security and they live longer. women are also caregivers in their own families and health providers across the board so they know the impact of this. our members are men, women, minority or not, close to the constituents. we are right there on the front lines. so when somebody talks about something, we want to know the

ramifications of that. we want to make sure that people are making policy decisions to understand how that translates. very unformed intellectually and by personal experience, caucus. the high tension wires go up when you talk about making changes unless you can justify what the purpose of this is. for example, if you talk about the pharmaceuticals, the purpose is to strengthen medicare. let's make sure it goes to medicare and not deficit reduction. it has a positive impact on the fiscal soundness of our country. but it is not in the accounting that this pharmaceutical money, we will use it to offset tax cuts at the high end and say that we are reducing the deficit. i only have two more, i have to make every minute count.

>> this morning, republicans were out here talking about the bills that they passed through the house. you talked about the bills that the democrats have brought forward that have had no action on the floor, and we saw the president calling for action on infrastructure, extending middle-class tax cuts and all of these different things. people want to know, this idea that they can create jobs, as if a broken process? why hasn't congress to send these bills to the president? >> you will have to ask the majority. they control the floor and the legislation. but i would say that there are bills we could pass immediately that would give confidence. i have spoken to many captains

of industry. is that term a still applying? ceos. they have told me, they will create jobs when they have customers. if people are buying their products, we create jobs. when you fire a public employee because of austerity programs, you are not only hurting the safety of the neighborhoods and education of your children, you're reducing the number of consumers. so we have to understand, again, the impact of all of these actions. and that is why all of the take no prisoners, that mentality, it lowers revenue coming in to the treasury. there are some suggestions that

are good there. i myself will reject a patent bill. i think it was the wrong bill, but it was something that past. for six months, how many bill signings have you witnessed at the white house? think back. how many bill signings, celebratory bill signings have you attend? it is something quite different. not that this isn't very useful, but i have internal work to do. >> i am going to get to end. has the government moved to change the measure and represent a cut? you hear anything at the white house yesterday from republicans to indicate flexibility?

>> the speaker said -- and the press told me that the speaker said there is a 50-50 chance that something could happen. i heard that from you, not from him. enough was said at the white house to set up another meeting on sunday. i obviously can't speak for the republicans, but we are having the next meeting. what was your first question? cpi? cpi spent a lot of time talking about the fourteenth amendment. why are we talking about something that is not going to happen? if it were to be something that were put on the table, it would have to be something put on the table, if it is to address

social security, if the money went to address social security. this money would have to go to the trust fund. they use it as the excuse, that it should go to that. the gang of six -- i have no idea what is public about the game of six. is it all public? it is now? [laughter] i have been told, this is true. i have been told that as they consider a change, they talk about phasing in and protection for the poor. those kind of things, the funds going directly to the social

security trust fund, some things like that. that maycussing things or may not happens. let's see what happens on sunday in a deal with what emerges there. there is concern about what would happen. i think it is a bit of that cut, but others do not. again, this falls into the category of hypothetical. say anythingcan't more, i don't know any more. the dirty rotten devil is in the dirty rotten details. we have not seen what that is, and when we have seen it, we can speak better to its.

>> also today, the house democratic caucus met to outline their position on talks with the republicans. and those talks are scheduled to continue on sunday. after their meeting, and john larsen -- larson and javier beccera talked. >> i know the speaker, the leader had a press conference. he legist concluded our caucus, and the suffice it to say, our caucus remains united in the ongoing concern of the preservation of medicare and social security ha. and it was very clear. we directed our leaders the understand and carry that message throughout these

negotiations. it is our sincere hope, of course, that the leadership on the other side comes to their senses. far too many people back home are concerned about how these ongoing discussions, and the flirtation with the debt limit impact them personally. including their mortgages, their pensions, and they have seen this story before. it is our sincere hope that these meetings over the weekend and on sunday are productive. and that there is a resolution that people are able to come to. that that clear resolution in no shape, manner, or form is going to impact the benefits of medicare and social

security. >> it was impressive to see the number of members who did not take the first flight home the way that we typically do to attend this meeting to get the latest word from the leader on where these discussions stood. it was overwhelming. the support for the position the leader has articulated to the president, publicly, that social security that had done nothing to contribute one penny to these deficits and to the national that should not be used to pay for reckless spending that led to the massive deficits. medicare, medicaid, the same thing. tremendous support and the leader says she continues to articulate that we should go.

it doesn't seem out of the latest report on employment, and the economy continuing to struggle to create jobs. foreclosures still running at a high pace, and with more and more economists on the conservative side saying, what are these crazies doing putting the full faith and credit of the united states on the line? and the mortgage interest rates of some of the american families on the line a vote that republicans over the years including seven times under george bush were willing to take so that we will not default on our payments. it seems that more and more, you have to ask the question, are republicans in denial? are they not willing to face the

facts before us that even conservative commentators are saying that you are ready to play russian roulette and pull the trigger on the american people. thee hoping and clearly caucus said to the leader, we're hoping that these sunday afternoon or evening discussions lead to something because this is becoming a little too scary the way the republicans are willing to bring america to its knees. >> not one jobs bill. and yet everybody does, that we could reduce the deficit by 30% just by having unemployment ago from 9% to 7%. we get the politics of this and why someone like to see that number stay high. for god's sake, for the sake of

the nation, for their pensions, this makes no sense at all. it is known longer a matter of playing chicken between democrats and republicans -- this is all too familiar a scene for americans or they have seen this picture before, and what happened? we will take a few questions and then we have to catch a plane as well. thank you. >> regarding the jobs numbers, hughes think the recovery might alter the perception of how many cuts are needed? >> that makes absolutely no sense. where are the jobs coming in the private sector? we keep on hearing from the

other side, we are going to cut our way to prosperity. how does that help the economy and unemployment as we see what is going on in the state's already with people being laid off? how have those jobs numbers increased because of that? the more we have to tighten our belts, where have the jobs come from? you can't cut your way to prosperity. >> how he felt that there was lots of distance between where he is and where the president is. i almost called her speaker, too. what did the democratic leader say? >> with the leaders said is that she was very firm about the notion and the commitment of this caucus to medicare and social security.

and it may be. in fact, i ducked out -- holly have long stated, we don't think that they are capable of delivering the time of day in a watch factory. we just recently saw that in a cr bill. in 2008, with their own president, and with the commitment to deliver votes that never materialized. and it was a far different crowd then, i might add. >> there is an interesting twist on developing here on this play. will republicans be able to do what they are supposed to do as

the majority? deliver the votes to do what they are supposed to do given that they had control of the house? as we continue to proceed down this path, it seems like the speaker is telegraphing that he doesn't have the votes and he will need the votes of the democrats in the minority to deliver on what he wants to do. that is where the leader has been very strong in saying, please don't expect democrats will deliver votes to the majority said that it can do its responsibility of running the house unless it recognizes the priorities, to strengthen social security, medicare, medicaid. don't expect the democrats will support balancing a budget on the backs of seniors and children and the disabled.

>> your level of frustration, you talk about a democratic president. how does the caucus insist that the democratic president not lower benefits? >> i don't think that is necessarily the president's intent. let's be clear about that. not being privy to all the discussions, i think you have to take these in the context in which they are presented. in terms of a larger plan that in no way, shape, or form will impact social security or medicare benefits, you know, in the context in which the other side is offering nothing and can deliver any votes and feels that cutting their way to the bottom or letting the nation the fault is fine. they have got to hear from their

constituents. our caucus wants to make it clear to everyone, including our constituents, where we stand with respect to social security and medicare. >> the president has been very clear. he is willing to put everything on the table. i think he is right. everything must be on the table and including vital programs. though we are saying is, the transparent and show why you want to keep something on the table. if you want to do something with social security, it is to strengthen its. not to use it to cover deficits. our message is not to the president, it is to republicans that have made it very clear that they want to use medicare to cover the deficits. they have introduced legislation.

and other house leaders on the privatisation bill. where they would take the money out of social security and make it more difficult for today's seniors. have also shown that they want to make deep cuts to medicaid, 2/3 of the money goes to seniors. the message that we are sending is to our colleagues on the republican side that this is where house democrats have said they stand. we believe the president is right in saying that everyone has to hang their ego at the door. most of us believe that the end of the day, we will keep on the table the things that really drove these deficits and not with the burden on seniors, disabled, and children cover deficits caused by the bush tax

cuts and the war in iraq. >> thank you very much. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> i want to pursue what i presume is the reason for not having the recess, the district work. that was successful. s that we are concerned about the impending arrival of the august 2 date on whicthe -- on which america would be put in position of defaulting on its obligations. i presume that's the reason that we want to make sure that we are here to work on that

issue. am i correct on that? mr. cantor: the gentleman is correct. it is my hope we can have some deliberative processes and open discussions so that we can arrive at an appropriate conclusion of the challenges surrounding the issue of the debt limit expiration. that is correct. i yield back. mr. hoyer: i thank the gentleman for that observation. i know the gentleman has said in the past that he belies it would be a very bad situation for r economy and for our country if we did not extend the debt limit. am i correct that the gentleman still shares that view? mr. cantor: the gentleman -- i'll say to the gentleman, mr. speaker, that i have said before that america pays its bills. just like the american people arexpected to pay the bills, to pay their bills at home and in their small and large

businesses. but the fact is, i think that the american people are expecting us to live up to the promise that we are not going to let spending get out of control again. and so the purpose of the deliberations that are ongoing throughout this capitol, at the white house, etc.,re focused and should be on ming sure we change the system, making sure we accomplish the necessary cuts which would exceed the amount that would raise the debt limit as well as to signal to the american people that we have changed the system. that this -- that this kind of unbridled spending ceases an we begin to live within our means, get the fiscal house in order, so that we can focus on the overriding need for this country right now which is to create an environment where jobs return. another gentleman -- i know the gentleman has seen today's jobs report. disappointing is an

understatement. i make the point again, as the gentleman knows, mr. speaker, he and i were at a meeting at the white house yesterday with the president in which i said again the import of our need to act an act responsibly and not, not to raise taxes on the american people and the small businesseshat we need so desperately to begin to crte jobs again. i yield back. mr. hoyer: i thank the gentleman for yielding. i'm pleased, as the gentleman knows, to hear that you want to stop the spiraling deficits that confront ourountry. i will repeat again, because the gentleman keeps mentioning this and i have enough experience to know what's happened and in the 30 years i've been here, of course we've had some few years of the obama administration but we had mr. reagan's administration, mr. bush first administration, mr. bush second admistration and we ran up over- i want the gentleman, i

know he knows this, over $6 trillion of deficiduring that period of time. however, in the eight years that . clinton was president of the unitedtates we had a 62 -- $62.9 billion surplus. now the gentleman makes the point that spending is out of control. the fact is, as the gentleman clearly knows, that when you were in charge of the house and the presidency and the senate you increased spending by more than was increased during the clinton administration by a percentage on an annual basis. so that i'm glad to hear that ur side now, without fail, talks about spending being out of control. as a matter of fact, i have a feeling if your side was spending five cents would you think that we would need to cut an additional five cents in revenues so that we could not pay the bills. because that's why we ran up $6 trillion in deficits you did not pay for what you

bought. i'm with those who strongly believe we ought to pay for what we buy. but i also believe that we ought not to put this country on the brink of financial chaos and bring us down in the eyes of the world because we don't extend our debt. now very frankly i think we'll pay for what we bu we call that taxes. whether it's defending america, paying our f.b.i., paying people who are researching cancer, heart, lung, diates issues, those are federal expenditures for which the american people pay through taxes. and very frankly if we're going to be responsible we make a very simple judgment. if we want to buy it, we ought to pay for it. that $6 trillion of deficit that was incurred during the presidencies and the president is the only person in america can stop spending.

only one. you can't do, it i can't do it. we need 217 other votes in our house, or there they need at least 60 votes to do anything. the president can do it himsel ronald reagan never had a veto overridden of a bill that said we spent too much money, george bush i never had a veto over overriden in which he see ared to a -- overriden in which he see are toad a bill saying we spent too much money and george bush ii never once had a vo overrid son that we spent money that he did not sanction. so i say to my friend, we did meet at the white house and the president of the united states, the leader of our party and i and mr. reid and mr. durbin all said yes, we need to get a handle on this spending. yes, we need to get a handle on the deficit. and, yes, we need to bring down the debt. and we need to come to the table

together with everything on the table. and we need to pay for what we thinwe ought to buy and frankly we ought to ensure that the united states of america for the first time in history doesn't pay its bills. ani tell my friend that we've had a lot of commentary over t last few day people on wall street, people in business, large, medium and small and i will tell you if the united states doesn't by august 2 agree to pay that which it owes, that which it has incurred, not what we're going to incur in the past, those debts we've incurred in the past, everybody in america is going to be hurt. everybody -- every economist that i've talked to says that interest rates are going to spike, stock markets are going

to be at risk and millions people who have pension funds and who have interest in their pensions are going to be adversely affected. the housing market which is struggling is going to be hurt. the economy that is struggle something going to be hurt. so i would hope that my friend and i will go to the white house on sunday where we'll sit with the president of the united states and we will be for a large deal that is referredo as a comprehensive solution so that we can in fact not in the short-term, not temporarily, but a long-term bring fiscal discipline to the operations of our country. our country needs that, i think the international community expects that of us and if we don't do that, i tell my friend, i think we will not have

fulfilled our oath of office. to protect and defend the constitution of the united states and serve the general welfare of our country and our people. now, some in your party of course have suggested there's no need to raise the debt. does the gentleman agree with that proposition? i'm not going to go through the quotes but as know one of your candidates for president has indicated there's no need to worry about raising the debt. she serves in this body, as a matter of fact. mr. cantor: mr. speaker, i'll respond to the gentleman as he knows, he and i have had plenty of discussions about this, so assume we're just on for show here that he wants me to say yes, i believe it would be a grave consequence if we did not reach the point at which we could arrive at a solution and put a bill forward that would permit an increase in the credit limit of this country with an

associated cut in spending and move to get our fiscal house in order. and as the gentleman correctly pointed out, the reason why now we will not be in our districts the week of the 18th is to ensure that we do get it right and that we recognize that the markets, the investors around the world are smarter than expecting us to just go and check the box to meet the date. at the end of the day what the markets and investors and more importantly the american people are looking for is thate act responsibly, that we begino manage down the debt and deficit . that means trillions of dollars of cuts necessary because i think most americans are looking at wasngton in disbelief, that somehow we think there's not enough money coming into the federal government. i mean, just look at the jobs

report today. i cannot fathom how anybody, how anyone thinks right now is a good time to raise taxes. who thinks that raising taxes on individuals and small businesses can help create jobs? we are in a crisis. people in this country need to get back to work. let me just, mr. speer, for the point of explanation, because the gentleman insists on going back deces to recount the past, and as the gentleman knows, i'm the first one to say that we came to this majority with some con trigs, that, no, -- con trigs, that, no, we weren't always acting in the fiscal health of this country and that's why we have taken the job at hand anact responsibly and passed a budget that actually put a plan in place to

manage down the debt and deficit, unlike the other body, unlike this president. and that's why we come to the table right now, as we approach this debt ceiling vote with a well thought out, deliberative plan to get people back to work while we get the fiscal house in order. but let's just review some of the statistics, mr. speaker. there have been 2 1/2 million jobs lost since this president took office. mr. hoyer: will the gentleman yield on that? mr. cantor: no, i will not. 13.9 milon americans unemployed right now. gallon of gas is significantly higher, well into the $3.50, $3.60 a gallon in places in this country. up from $1.85 when this president took office. $14.3 trillion in current national debt. up from $10.6 trillion when this president took office. if you worked -- if you work that out, $$46,000 -- $46,042 debt per person up from $43,371

when this president took office. so you can go through line by line of how things have gotten worse for the american people. now, we can t here and blame and point fings all day long. but i would suggest, mr. speaker, the american people are tired of the bickering, th want to see some solution they want to see us come together. that's exactly why we have altered the schedule, so we can begin to actually deliver on the promise. so i agree with the gentleman from maryland, the democratic whip, we've got a serious challenge ahead ofs. we on this side of the aisle have been consistent in our efforts to meet that challenge in a responsible way, but i would underscore again, now is not the time to raise taxes, now is not the time to say that washington needs more money because that money comes off the hard work and backs of the american people.

and i yield back. mr. hoyer: i thank the gentleman for yielding back. very interesting comments he makes, of course he leaves out some things. he talks about the jobs that were lost. those jobs were lost of course as this administration took fice. this administration has gained back two million of the eight million jobs that were lost during the economic program that my friend from virginia voted for the most part. eight million jobs were lost and the month that this administration took office in january, 780,000 jobs in one month were lost the last month of the bush administration. that's not very distant past but let me tell you, i heard the same rhetoric, you said it changed, i heard the same

rhetoric in 1993, the same etoric when we adopted a program that we said would balance the budget, bring the economy back and create jobs. the same rhetoric, oh, no u won't do it. e program that you're going to adt, none of which -- none of you voted for, you weren't here, i understand that, but the same rhetoric applied, you thought we were going to tank the economy, kill jobs, explode the deficit and have high unemployment. in fact, as my friend well knows, he didn't read those statistics because he thinks they're ancient history because you opposed that poly. but that policy created 22 million jobs. that's a 30 million-job difference between the bush administration that was the follow-on administration and the clinton administration. 30 million-job difference, i tell my iend, under the policies that you adopted and

you supported in the 2000's. so i would hope that my friend's comments are correct, that you have decided to change. in point of fact we need change. and in point of fact the american public, which is divided itself, but would like us to come tether, i a hopeful that we do that and my friend and i he had the opportunity to talk about this. we do have significant diffences but none of us can put something on the table and say, if you don't agree i'm going to take the -- i'm going to tank the economy, i'm going to have america default for the first time in its 200-plus years of history. if you don't agree and do it my way. i have said, the leader has said on this side, everything's on the table. we understand that you got to pay for what you buy and we also understand we got to buy less.

and we're prepared to do both and in fact we have agreed to do both in the biden talks. now, my friend knows, he talks about economists. the most successful investor in america, i think most people would agree, is warren buffet. warren buffet said we raise the debt ceiling seven times during the bush administration and now in this congress, under the republicans, they're using it as a hostage and you rp really don't have any business -- and you really don't have any business playing russian roulette to get your way in some manner. we should, he said, be more grown up on. that to that extent he echoed the comments of our speaker who is trying, in my opinion, to get to a place where we can come together, compromise as is critical under democracy, pay our bills and reduce our obligations and reduce snding.

buffett went on to say, we should be more grown up on that. if we don't meet the august 2 deadline, he observed, you're playing with fire when you don't need to play with fire and we don't need to tell the rest of the world that any time people in congress start throwing a tantrum that we're not going to pay our bills. that is not responsible havior. it's not adult behavior. it's not good for anybody in the united states america. and it's not good for the international community. in fact, senator simpson, who was referring to tom coburn, has saidlook, you've got to have everything on the table, including, yes, revenues, yes, taxes. some bard has said that taxes are the price we pay for democracy. they should not be any higher than they need to be but we ought to pay for what we -- for what we buy.

if people n't want to pay for it, we ought not to buy it. unfortunately, the reason we racked up $6 trillion in deficits in the reagan and both bush administrations is because we bought things and didn't pay for them. as you heard me say at the white house, we, beth parties, voted for some things and didn't pay for them. we've got to stop that. that's why we put in ace statutory pay-go. you say, well, we've changed. you passed a budget that doesn't balance the budget for the next 27 years. you passed a budget you voted for that. i didn't vote for that budt. doesn't balance the budget for 27 years. alst three decades. very frankly, i don't think that does it. that's why we went down to the white house yesterday and almost everybody in the room said, we immediate to do a comprehensive, disciplined,

courageous, honest, pncipled resolution of doing what you say you want to do, that your party wants to do, and what i'm telling you, my friend, we want to do, because there is no option. we must bring this defit down. we must -- the debt we have confronting us is not sustainable. i would urge my friend, and i want to congratulate speaker boehner who at the white house said, look, we need to do this, we need to have a comprehensive agreement. that's what democracy demands. i'm not going to agree with some of the things in that bill. you're not going to agree with some of the things in that bill. if in fact we passhe bill. but if we come together, if we act as adults, if we do what

every responsible financial economist and advisor has told us we must do then america will be pleased with us. i tell my friend from virginia if we don't do that, if we continue to buthings we don't pay for and we continue to ask the people to get it for free, then frankly, your children and my grandchildren and children and great grandchildren will not be happy with us. so i urge my friend, he and i will be going to the white house on sunday. i urge him to come to the table, as i will come to the table, i tell him, with the understanding that compromise is essential. that the pry crisis that confronts us is real. and that america expects us to act in their best interests and have the colonel, not the

politics, not the ego, not the view of the next election, but the view of the long-term as we come together and try to confront this issue for which all of us are responsible, no one party, no one member, all of us. are responsible. but then again if that is the case, we are all responsible for its resolution. and i yield back -- i yield to the gentleman. mr. cantor: i thank the gentleman. i would just try and keep my remarks short and that is to say, you know, listen, it's about jobs right now. an the gentleman correctly points out, we have a real spending problem here. and the question is, how do we address the first priority to get americans back to work, and address that spending problem we got? now if the gentleman says we have to pay for what we buy, i certainly agree with that.

we ought to just be buying less. as a government. because the money doesn't belong to the government, it belongs to the people and if we want more people to get back to work, we should allow them to keep more of their money so that they can create jobs. and that's really where the fundamental disagreement has been over the last couple of weeks. it certainly was what put the biden talks into abence because there's a lot of good work that was done by both sides of the aisle in that talk. and i still believe that the product of those talks will prove to be the basis upon which we can arrive at an appropriate resolution of the challenge before us around the debt ceiling. but why these talks ended was that your side insisted that we raise taxes. and i would say to the gentleman, raising taxes is, as he would put it, paying for

what we buy. i'm saying, let's stop buying so much. and let the ople decide what it is they want to do with their money. mr. hoyer: reclaiming my time -- mr. cantor: if i could finish, i'll yield back. mr. hoyer: i'll continue to yield. mr. cantor: i know the gentleman likes to focus on the hstry before, but ever time the gentleman says, job lost here, jobs lost there, to posit again, there have been 1.7 million jobs lost since the stimul bill we feel didn't need to do the stimulus bill because now we are stuck with over $800 billion in additional debt with now unemployment today at 9.2%. so again, question whether we're on the right policies

here and we're spending the dollars we need to be spending. maybe we shouldn't spend it. maybe we should let it be invested in the private sector. i would end by saying again, the deficit is a real problem. we got a $1.6 trillion deficit this queer, largest in the history, and third consecutive year of trillion-dollars of deficit. i say to the gentleman, mr. speaker, we can't tolerate that. the president shouldn't tolerate that. the american people have no patience anymore. that's why we need to get to work trying -- try to lower the hyperbole and get the job done. i yield back. mr. hoyer: i thank the gentleman for his comments. the gentleman, i understand, does not like me to look back. but the problem with being around for some time, you hear people say things that this isn't going to work or that is going to work and you know what? hopefully that ought to be

instructive as to whether it did work or didn't work. the problem i have, which apparently, i know you don't appreciate, is that i've heard the rhetoric before that you just used today and i heard it in 1993 on a program which had revenues in it, or as you like to say, taxes, obviously those are revenues. and it was gng to destroy the economy. who said so? phil gramm, economist on your side. said we would deficit -- devastate the economy. he was dead, flat, wrong. 180 degrees wrong. we had the best economy in your lifetime. now furthermore, and let me instruct the gentleman, i don't know what u're reading from but your figures are wrong. over the last 20 months, we have gained two million jobs, two million jobs. now, did we lose a lot of jobs

in the first six months? we did. now, there is no doubt in my mind for one second that if it had been a republican president and democratic administration, there is no president who wouldn't have blamed that on their predecessor because they couldn't turn it around. so when the stimulus took effect, we gained two million jobs. have we duaned enough? no. we lost eight million jobs under the bush administration. we've only filled 25% of the hole. i don't know what paper you're looking at, but check your figures. this past month was disappointing. but some people are doing pretty well in america. stock market closed at about 12.7 plus yesterday. one thing i think people are worried about is making sure we act as adults, act responsibly, pay our bills and ensure that

america does not default. all i'm going to say, and then i'll close, is that i hope the gentleman and i join together on sunday and everday thereafter between now and when we can resolve this issue is so that we can pay our bills, stabilize our economy, and give what the gentleman talked a lot about in our colloquies when our positions were reversed, i remember those days, talked a lot about,and that was competence. that was stability. the failure for us to act. as we acted seven times in the bush administration to raise the debt limit and i don't have the specific number but more than thain the reagan administration. and by the way, in the last fouriers of the clinton administration, does the gentleman remember how many times we raised the debt limit? zero. zero. why?

because for every up with of those four years we had a surplus. not a deficit. a rplus. mr. greenspan was worried at the enof the clinton administration we were going to pay off the debt too quickly. and president bush projected a $5.6 trillion surplus. so i tell my friend that the reason i look back is to not repeat theistakes of the past. we didn't pay our bills. we paid our bills in the 1990's, we started not paying our bills again, you jettisonned the statutory pay-, jettisonned it again, essentially, not the statutory part but the rule part. i would hope, again, i don't enjoy going back and forth on this but i am concerned for my country. the speaker said he wanted to solve this problem by june 30. it's now jewel 7.

-- july . we haven't resolved it. the country is waiting for us. let us hope that all of us will not say, can't do this, can't do that, can't dthe other. let's go down to the white house on sunday, with the president, with the senate, with the leaders of this house, and say, yes we can. we can be responsible, we >> british prime minister david cameron hold a news briefing. later, the president and congressional leaders discussed the latest unemployment leaders -- in numbers. >> we will discuss the british phone hacking scandal with

ansrew dedgecliff-johnson. "washington journal" begins lead at 7: the space 45 eastern time. >> who is really going to get fired up over nancy pelosi and john boehner on the other? >> in the declaration of he takes on the problems of the two party system. a sunday night on the c-span "c &a." >> in side, new and returning house and senate members with contact affirmation including twitter addresses, maps, and

assignments, and information on the white house, the governors. order online at cspan.org/shop. >> the house ways and means subcommittee held a hearing today on proposed changes to social security. proposals included raising the retirement age and increasing social security taxes. witnesses included former social security advisory board chairman and a member of the social security medicare board of trustees. the said committee was chaired by texas republican, sam johnson.

>> republicans and democrats agree of this much -- current benefits should not change for those in or near retirement. all of our lives, they work hard and play by the rules. they deserve the peace of mind knowing social security will be there for them. young people deserve peace of mind as well. at our last hearing, the subcommittee looked at our options to address these challenges and heard that these options do not reward hard work or fix the social security shortfall. with unemployment, shortfalls, and so many people unable to how -- unable to find work, nothing should make it harder for young people to find jobs. we will hear more about changes to benefits and their impact on

future beneficiaries, workers, finances, and economic growth. since the beginning of the program, benefits and work -- based on lifetime earnings. the formula that determines benefits is designed it to -- social security first paid monthly benefits in 1942 a lady who worked for just three years under social security. her first monthly check was $22.54. her check was not for inflation and her lifetime benefits for her and her age group were supported by a surge of young workers. during her lifetime she collected nearly $23,000 in social security benefits. today, 55 million americans

receive benefits averaging over $1,000 per month. by 2035, over 90 million will receive benefits. benefits are more generous, but the number of beneficiaries that will rise much more rapidly than the number of workers now struggling in today's economy who will need to support that. the reality is there are not enough young workers to support the baby boomers who are retiring at the rate of 10,000 a day. social security also provide essential income to worker's families, spouses, children, and survivors are all eligible for benefits. one out of 13 beneficiaries receive family benefits. many of our witnesses will review how american social security has changed over 76 years. today, people are just living longer. that is nice, is it not? when social security was

created, american slipped on average to 64 and in the retirement age was 65. according to the actuaries, congress tied the aid from increases and less expectancies from the beginning. however, i know that life insurance guys tell you that you are going to live to be 100 nowadays. no wonder members on both sides of the aisle expressed support for raising the retirement age. in 1935, social security was born admits a great economic crisis -- the great depression. franklin roosevelt said that social security can furnish only a base upon which each one of our citizens can build a security through his own individual efforts. in other words, social security benefits or intended to provide a modest safety net. in these challenging economic

times, franklin roosevelt's statement still rings true. while everybody should receive a benefit, not everybody relies on social security. what ever solutions congress may consider, we must protect those who depend on social security the most. in the meantime, until congress acts, workers and their families are a challenge to plan for their retirement. an important tool in their planning is a social security statement which includes the earnings history and estimated social security benefit. is the main document that social security uses to communicate with over 150 million workers and their future benefits. today, we will hear from the results of the review done earlier this year. americans want and deserve the certainty that social security will be there for them. i am confident by working together we can provide that

certainty. i think all of our witnesses for joining us today, and i look forward to hearing their advice on ways to move forward. we are expecting boats around 10:00 or 10:15 this morning. we will try to work you all in. i will implore all of our members to >> social security has never contributed a dial in to the nation's debt, not a penny to our federal deficit this year, or in the year of our nation's history, yet some in this town insist we should cut social security benefits for seniors today for these deficits, deficits run over the last 10 years as a consequence of

fighting to unpaged four wars and giving unpaid for tax cuts to millionaires. most americans would say it is immoral and un-american for this country to tax peter to pay paul, to make retirees, disabled workers and children pay for the bush debt. how can that be right? here is the simple truth. today, social security has over 2.6 trillion dollars in its trust fund, generated by work force contributions. social security has ordered 41 $6 trillion and only spend $12 trillion. do the math. as a result, social security has an up incoming reserves to pay full benefits for the next quarter-century at about reports of benefits after that. social security is not broke and it will not go bankrupt. that is because i like the federal operating budget, social security cannot deficit spend,

or whatever base its own debt ceiling crisis. our challenge is to address a manageable shortfall in social security after 2036. the size of that shortfall is about the same size as the cost of keeping in place the bush tax cuts or just the wealthiest 2 percent of american taxpayers. preserving social security is simply a matter of priority, a matter of right and wrong. what is wrong is cutting social security benefits for people who work part of their lives to earn benefits for themselves and their families. it is wrong in cutting social security to pay for tax cuts for millionaires. most seniors have limited incomes. the average benefit for a retiree is $14,000 a year. six out of 10 singers rely on social security for more than half of their income, and nearly a third have virtually nothing else to carry on. as people get older and began to

out of their other retirement savings, they began to rely increasingly on their social security pay check. the benefit cuts republicans have put on the table this year will have devastating consequences for today's seniors and for the 155 million future beneficiaries who are paying into social security today. in our last. we learned that under the social security privatisation bill introduced by congressman pete sessions and others, social security's ability to pay benefits would be severely compromised. if we enacted the republican bill, current seniors might not get the monthly checks that earned through a lifetime of work. in addition, republican paul ryan has a plan to privatize social security to raise the retirement age, and to cut benefits for the middle class. house republicans recently voted to create as back -- special and

-- republican committee including majority leader erich cantor has proposed raising the retirement age at a time when socials record will have $3 trillion in its trust fund. the plan would cut benefits for middle-income workers and could easily cost about $34 a year when they retire. i am grateful that we are holding a hearing on social security benefits. we need to have a comprehensive discussion on all the options available to us to strengthen social security. where you stand on social security and were you fall on the ways to strengthen it will speak volumes about your priorities for our country and for the generation that build the america we so love. with that, i look forward to the testimony of our witnesses. >> $3 trillion is a lot of

money. you cannot pay benefits in bonds. social security needs cash, and i do not know where treasury gets the cash to redeem the bonds. treasury has to roxburgh. today the u.s. borrows 40 cents for every dollar it spends. much of it from the chinese, and sends the bill to our children and grandchildren. >> may i comment on that? >> this is a piece of paper like the treasury certificate that social security has. it is simply a piece of paper that says $20 on it. it is worth $20 only if the full faith and credit of the united states backs it up. this is a savings bond and treasury certificate my daughter got when she was born. it is supposed to be worth $50 when she -- she cashes again when she turns 18.

it is worth money versus this envelope or this piece of paper, simply because we say we have the full faith and credit of the united states to back it up. whether it is this or this or the social security treasury certificates or the ones that china has or japan has, we either are going to live up to our obligations and our debts are we are not, but to say that the trust funds $3 trillion are mere paper, that this paper is worth money, and china's paper is worth money, is an egregious way to tell seniors that they paid into a system and to make them believe is not there for them, and for our kids as well. my daughter relies on this $50 savings bond the weight seniors rely on social security. >> i want to remind our witnesses to limit their statements to 5 minutes, and be advised that without objection from this gentleman during your

statements in writing, it will be entered into the record. we have an independent consultant from maryland. thank you for coming to washington. we have a ph.d. and senior fellow at the urban institute's, vice-president for finally economic security, national women's law center, a ph.d. research fellow at the hoover institution, and a ph.d. director for educational work force and income security act the government accountability of this. thank you all for being here.

>> good morning, mr. chairman. thank you very much for inviting me here today, members of the subcommittee. my remarks today will focus on the need to modernize social security's benefit portfolio, to improve the effectiveness with which the program meets one of its long-term specified goals, one of the ones you mentioned in your opening remarks, mr. chairman, the reduced to believe character of the program. -- redistributed character. i show how the retirement system has got more costly overtime. an individual return today will have worn payroll taxes relative to lifetime earnings more than six times those of a worker retiring in 1955. in your opening remarks you mentioned getting the first social security benefit. when she retired, she had paid $25 in lifetime taxes into

social security. she did fairly well under the program. today, participants are not doing quite as well. if you add in the supplemental cost of setting for an adequate retirement income, the cost of retirement today has tripled over what it was in 1955. these costs will automatically continued to climb under current law for at least another decade. at in health costs in today's workers are facing claims exceeding one third of their lifetime pay, just to cover retirement and health costs. that is before we address the underfunding of social security and medicare that i know you are all aware of. retirement security is important. we should not lose sight of the need to preserve the prospect of some prosperity game for workers and the pitcher. we cannot address our financing issues by borrowing more cross that workers. some of the four files can be addressed by making social security more assistant -- more

consistent with stated goals and modernizing it to correspond with 20% three realities. the benefit formula established in 1935 was established -- intended to provide higher benefits compared to those with higher earnings. at least a dozen different time since 1935, congress has reaffirmed that commitment. table 2 shows estimates on what is called a systems money's worth. the calculations are for persons born in 1949 and compare the value of their respective lifetime social security benefits at age 65 to the accumulated value payroll tax collection on lifetime earnings. numbers in the table that are greater than one suggests some segment will receive more expected lifetime benefits than the value of their contributions. those numbers less than once a just the opposite.

if you look at the values for 100 couples, you can see that they expect to do much better at every earnings level on average than their single counterparts or married individuals and to order couples. the system provides higher benefits for low earners single workers then couples. in a program that is expected to pay higher benefits for low earners, that is inconsistent with the stated goal. in the third table, i factor in supplemental savings, the tax benefits for employer sponsored savings, and the result carries through the whole system. in a formal statement, i site to studies that have documented that the spousal benefit feature is essentially defeating the redistributed feature embedded in the benefit formula. the reason these results have arisen is because the spousal benefit tends to be concentrated

among higher earners. families with low earnings levels often have little choice but to send all members of a couple to work in order to make ends meet. partly this is so today to a greater extent than in the past because many modern workers have to surrender so much more of their earnings to cover social security and their own retirement savings in health insurance costs that economic circumstances leave them no choice but that both spouses have to work to cover family needs. for most workers today, this also benefit has little or no economic value but renders their treatment unfair relative to those who benefit from it and pay nothing extra for it. either we should quit the pretense that social security is resistivity of, -- redistributive, or we should make it fit the stated intent. the introduction of a true joint

and survivor benefit for married couples. the operation of the spousal benefit partially covers this void now, but by perpetuating its existence in mitigating the need for joint writer benefits, existing policy propagates another inequity. the longest living spouse today receive little or no benefit in consideration of the deceased spouse's income and participation in social security. this makes an even more glaring problem. the retirement equity act of 1983 record their private employer sponsored pension offer joint and survivor benefits and the only way it can be waived is by boat persons actuating the benefit. it can be financed within the structure of the benefit itself. it does not have to add expense to social security's cost. it would modernize the system and make it more equitable and would be more efficient. >> thank you, sir.

>> i am glad to be here this morning. i am here representing the american academy of actuaries. we have roughly 17,000 members, whose mission is to serve the public on behalf of the u.s. actuarial profession. i want to talk about two things. i want to talk about actuaries and the role of actuaries in assessing the solvency and sustainability of financial systems, and i would like to talk about a position we have advocated, that the social security retirement age be increased. actuaries go about the business of evaluating complex financial systems, and we did that by constructed models. these models are designed to gauge the long-term solvency and sustainability of these financial systems.

we go about that by looking at the system from the standpoint of the principles that seem to be functioning within that system and the assumptions that support that. the reason we do that is because we then turn around and project those principles into the future, based on a certain set of assumptions. as you know, there is talk about actuarial imbalances in the social security system. those calculations are not here and now assessments, because there is a $2.60 trillion trust fund. this is a long-term imbalance that we talk about. it is actuarial principles and assumptions that give transparency into that sort of imbalance, so therefore what we do as actuaries is examined those principles and test those assumptions. one of the key principles that

the social security system operates on is that the current cohort of walker's what -- of workers will support the current cohort of retirees. that is one of the principles on which the system has been built. one of the assumptions is that right from the start, that longevity was a relatively fixed notion back in 1937, when longevity was what it was, and for people at birth at that age, life expectancy was 64. for those that reached age 65, their life expectancy is that point was 12 years. fast forward to today, and life expectancy for 65-year-old is roughly 18 years. that brings us to my second point, which is the american academy of actuaries and our position around retirement age.

we at the academy had examined and explored all sorts of suggestions, options, and alternatives for closing that imbalance, closing that long- term, 75-year imbalance. one of the topics that has risen to the top of the list is increasing retirement age. the reason is because we believe it was an assumption that was a fixed assumption back in 1937 that deserves re-evaluation today. every actuarial perfection -- projection that has been done since then has updated and anticipated increased longevity including those done in the current time frame that takes into account this bid to% improvement in longevity. to restore balance to the system and maintain that balance between the working years and the retirement years, the academy believe it is paramount

that at the top of any list of reform items, increasing the retirement age has to appear on that list. we are mindful of the fact that any change to the system has to be done with respect to what objectives we are trying to achieve, the impact on near-term and long-term retirees. we are mindful of the fact there will always be consequences to any change, and those consequences may need to be mitigated. we are well aware of that and we stand ready to help evaluate any sort of proposals that may come forward that appear in any sort of reform package. those are my remarks, mr. chairman. >> thank you very much. >> it is an honor to be before you again today. as was committed by several people, social security was first enacted and since then

vast changes have occurred in the economy and life expectancy, health care, and the labor force participation of women. we simply cannot design a system for 28 by what were the need for society in 1930. at the margin it is not serving us as well as it could. consider the following. if account lifetime benefits and social security, taking into account retirement age issues, social security provides about $555,000 worth of lifetime benefits to the average retiree today. if we count medicare, it is over $1 million. what we are really talking about is the growth to the benefit that we are trying to figure out how to constrain, not cutting back on existing levels.

the younger and younger people are essentially getting -- it is made modest progress in dealing with poverty. it discourages work among older individuals when we need them to be in the labor force. it is a threat to the it denies equal justice in all sorts of ways. it discriminates against single head of household, which is largely women. none of these features derive from any conservative or liberal principle. they are just badly designed features that do not meet the needs of today and are not well targeted. in my testimony i talk about four different types of reforms that are important to what we are considering. one is to figure out ways to restrict the growth in benefits and number of years of benefits.

it is not necessarily cutting back on years, but clementine that growth of the system is out of balance. we need to think about ways of increasing labor supply. we need workers in the economy that brings revenues to income tax. there is discrimination largely in single heads of households, working women or abandoned mothers. i would like to encourage you to think about latching on some private pension reform as part of a broader set of programs for the elderly. i talk about restricting growth in the system is out of balance. if congress would simply put on a rule that says while social security and medicare are out of balance, we will cap the total amount of benefits to $1 million per couple. it is the growth in benefits

beyond the package of benefits for couple that is causing the imbalances. another issue of redress is i would just retirement age to account for the back -- the fact that people are living longer and longer. more and more benefits are going to people further and further from debt. it is not concentrated where needs of the greatest. i favor a strong minimum benefit so we provide an even salary base of protection for the bottom third of the income distribution. i mentioned in the testimony that would try to encourage greater labor force participation. that is where increasing the retirement age is important. that includes the early retirement age. it does a lot for income tax revenues. it helps us deal with the demographic issue of going who threw world where we are encouraging one-third of adults

to be on social security. i also suggest all sorts of ways of improving the equity and efficiency of the system, including designing a strong minimum benefit to help lower- income people. i would move towards actuarial neutrality because it is a major cause of the problem of discrimination against single heads of households. i would try to add on some private pension reform on to social security so we get some saving for the broad mass of middle-class people who do not have much savings and retirement. the definition of a pessimist is someone, when he smells the scent of flowers, looks around for a casket. what you are going through politically these days, on social security, taxes, and the debt, is very difficult. you are having to identify who is paying for government. the promises we made in the past cannot be met, but if we take

off the straight jacket, we are freeing ourselves and congress to put resources towards those needs that we consider to be the most important in society. thank you. >> thank you, chairman and members of the subcommittee for giving me the opportunity to testify on behalf of the national women's law center. i am going to shift focus to what social security means to the budget of the americans who rely on social security. two out of three beneficiaries 65 and older get most of their income from social security and for one out of three, it is virtually their only source of income. that is striking when you realize the average social security benefit is just $14,000 a year for older americans and just $12,000 a year for older women. as a result, even with social

security at its current levels, economic insecurity among the elderly persists, especially among women, and their incomes are meted -- are modest. genet in oregon is a widow, 84 years old, living alone. she worked until late '73, but her only income now, apart from a little help from her children it, is her social security check. her benefit is about $20,000 a year, so it is actually higher than average, but it is tillis trouble for her to make ends meet. forget cable-tv or new clothes. what about food? she explains, i cannot afford meat anymore but every once in awhile if i see a great bargain i will splurge on a piece of meat. how may very thin slices of cheese.

in does not cover health care. she told us, a couple of months ago, my dentist tell me i needed a root canal. i have had to put it off because it is $800 and i cannot take that on now. i am taking a chance with my help, but i don't know what else i can do. not a lot of room to cut their. social security benefits are already scheduled to decline. the retirement age is going up right now. and has increased from 65 to 66 and is rising to 67. every year's increase in the retirement age is an across-the- board benefit cut of about 7% at whatever age people take their benefits. rising medicare premiums will consume a greater portion of retiree's social security income. on top of that, other sources of security -- secure retirement are declining and the recession has made things worse.

this adds up to a compelling case for protecting and strengthening social security benefits, yet there are a number of proposals out there that would cut social security benefits, even for current retirees. i was pleased to hear your statement about the bipartisan support for protecting those people. for example, switching to the change cpi for calculating cost- of-living adjustment in social security would cut benefits for current beneficiaries and produce bigger cuts with every year of benefit receipt. this change would particularly hit women, because they live longer than men, are more reliant on social security, and already it much greater risk of poverty as they age. those who say that cut will not hurt or not trying to live on social security. a cut of $56 a month represents the loss of a week of food every month.

the bowles-simpson plan relies on 4/5 of savings in the 7 digit year. restoring solvency to the social security program by slashing the benefits people need to live is like fixing a stubbed toe by cutting off a foot. some proposals would cut benefits more quickly and more deeply. for example, the republican study committee proposal to speed up the increase in the retirement age and bills that are pending depending on the senate side to accelerate that increase would cut benefits for people currently between the ages of 55 and 60. in addition, the act introduced by representative sessions would

simultaneously worsen trust fund's solvency and jeopardize benefits for current retirees, as the chief actuary testified at the last hearing, and jeopardize not only the retirement benefit for workers to choose accounts, but disability and life protections for their family. i recognize it is important to make adjustments sooner than later, but this committee has the time to make those adjustments right so that people do not get hurt. thank you. >> thank you, mr. chairman and the subcommittee for the honor of testifying today. owing to the time constraints, we will bypass most of the background information and just offer nine suggested rules of thumb for you to consider as to contemplate changes in social security benefits. first is very simple, act soon.

the balance of any benefit for tax changes is an important guy you judgment, but whatever is chosen, will be better off with that solution is in acted sooner. the longer you delay action, the more changes will be concentrated on a small number of courts and that will increase aspects on vulnerable members of those cohorts. to do otherwise means younger generations will face higher social security tax burdens than any previous generation has tolerated. program costs were about 11.5% of worker wages in 2008 before the baby boomers begin to retire. under the current formula, that would rise to over 17% by 2030. we would be trying to pay benefits that are rising dramatically in per-capita terms relative to inflation. today typical retiree gets the

benefit of about $18,000 a year at the normal retirement age. if we just the rate of growth now, benefits and still rise in real terms and do not have to be cut from today's level. believe the current formula in place, we are on the risk of future benefit declined as voters rebel against the hon tax rate required to sustain current tax rates. our population is aging rapidly and we have enacted various increases over the years and established early retirement. people are retiring earlier and getting a higher benefits and living longer. something there has to give. we have to raise both the early and normal retirement ages three years just to get back to the starting point.

the fourth rule of thumb, the asean any changes you want to make as rapidly as you can to be effective before 2035. 2035 is when we hit that 27% cost rate and after that, cost or relatively flat. any benefit changes you postponed to occur after 2035 will not do much to address the looming tax burdens facing yogurt workers. the current system is designed to drive seniors out of the work force, which may have been attractive in 1935, but now we have the opposite problem. we have a future economic growth jeopardize what -- i would draw up millions of baby boomers from the work force. we should increase the reward for delay plans an offer a lump- sum option to make their delayed for current credit more attractive. we should redesign the benefit

formula. right now, the longer you work and the more your average earnings rise, the lower incremental returns on social security contributions. we should redesign of formula to deliver proportional benefits for every year worked by seniors. protect the vulnerable by restraint benefit growth. the less is left over for vulnerable populations within a given level of tax revenue. it is inefficient to have higher tax burdens driven by benefit growth beyond inflation for workers. there is an important conceptual distinction between -- 1 requires no new administrative capabilities and does not penalize individuals for the savings they do outside of social security.

maintain the link between retirement and disability benefits. the formula is based on the determined formula and that is important. limits gaming of the system and allows for a smooth transition once a disabled individual reaches retirement age. avoid unnecessary complexity pecan. not every part of the formula can do everything. you'll have goals for targeting benefits, but you cannot ask the retirement age to handle that. my recommendation would be set to return age for the general case that reflects the population aging and did your benefit harding through the basic benefit program. rejiggered benefit targeting through the basic benefit program. >> we can tell people to stop getting older. [laughter]

>> thank you for inviting me today. you have heard others speak about ways to stabilize social security's financial future. one of the most important vehicles for explaining social security programs is the individual must security statement. the statement is the federal government's main document for communicating with more than 150 million workers about their social security benefits. it also serves as a key financial literacy tool to educate the public about social security as mandated by law. it changes take place, the statement would take on added importance as it needs to explain them. my testimony will address the current status of the statement and plans to improve its usefulness. my remarks are based on interviews conducted in the last month with officials, documents that provide, and prior work on the statements understand ability. with regard to status, the

statement is not currently being distributed. ssa used to mail a statement to workers annually but the but -- ssa is instead preparing to make the statement available on line and has begun developing a new web portal for this purpose. both the portal and the online version of the statement are currently in the initial phases of development, and will need to be fully tested. as a result, ssa officials are uncertain when the statement will be available to the public. there are hoping for early next year. in the meantime, copies of the statement are not available and request for star directed to the ssa retirement estimator. although useful, it does not feel the same function as the statement. the focus on getting the statement on line and securing

the personal information it contains is important, but these elements should not be the only concern for the agency. ssa woolwich plans in place for the ability of the statement on line. the have not developed a plan for carrying it out. they will need to consider how best to provide this information to people without internet access. even the relatively few computers available in selected field offices will not necessarily permit access to the online statement itself create in individuals without computers would even note to go there to look for it. agency officials would like to make the statement available in spanish, but the initial version will be available in english only. ssa officials have said they believe the electronic format has advantages for individuals

including immediate access when needed and not simply when it arrives in the mail. officials note that with an electronic statement they can provide links to related documents, thereby providing complete information but minimizing the lindsey description in the statement itself. ssa plans to draw an industry best practices to make the system more user-friendly. although they are planning such changes, the first publicly released version of the statement is set for next year and it will be nearly identical to the current print version. it means sticking with the limited graphics and layout that should have been modernized years ago. officials said they do not plan to change the content of the statement because so much of it is statutory required. we noted in our 2000 report that the statement contains descriptions and concepts that are confusing. this is the same content they

plan to roll out online. role wasear what played in the design or content of the on statement thus far. in conclusion, the ssa decision to suspend mailings this year may negatively affect millions of americans and could openly have a positive result of modernizing delivery of this important inspiration. because this decision was made so abruptly, ssa faces pressure to take quick action to restore the availability of the statement, which means there is little or no time to redesign the statement. that is not our greatest concern. the lack of preparation for providing all american workers, including those without computer resources and those without english proficiency, with an understandable version of the statement risks leaving a significant portion of our population without information about social security at a time

when such information is more crucial than ever. we recommend that the commissioner take steps immediately to address these access issues and ensure that the statement remains an important tool for communicating with all workers. that concludes my statement. >> thank you very much. we are struggling to meet a vote deadline here this morning, so i would like everyone to have a chance to ask questions. i will limit my time to 5 minutes and asked the ranking member to do the same. >> mr. terry, your testimony makes a clear and compelling case for raising in the interpreted the retirement age. -- for raising the retirement

age. everyone ought to be listening carefully to what you and the experts have to say on this issue. we cannot force people to work longer, but we can encourage them that it makes no sense to attack someone who wants to work and who we as a nation need to have worked. we may not want to tax them as they get past a certain age. why not encourage older workers by freeing them of their social security payroll tax that tax is the very first dollar of income? it must make sense to you because you mentioned it in your remarks. how much would this boost older worker's willingness to work, and do you think it would encourage or we should encourage employers to create jobs for them, and finally, how would this benefit our country? >> i like the way you posed the

question because i think you are suggesting that it is not simply a matter of forcing people to do something they do not want to do, that we may have impediments inadvertently set up to prevent people from working longer. if work is thought of as drudgery from which people must escape and social security is the savior for that escape, then i think that is probably a flawed premise and the premise your questioning is that in fact there may well be removal of disincentives to work that could very well and courage this sort of increase in productivity from the work force that we all could benefit from. the academy does not have a position around the elimination of payroll taxes or the cutting

back of payroll taxes for older workers. that should be something that is on the table, and we would be happy to take a look at that and examine it from an actuarial perspective. we have not done that yet, but we would be pleased to do that. >> the social security statements, one of the few government publications that reaches nearly every working age american, reminds workers how much of their wages they pay in taxes for the promise of future social security benefits and give that al -- gives an estimate of what those benefits might be. >> the law says that the social security administration must provide a social security statement to individuals aged 25 and older. how the statement is provided and whether it is mailed, online, is something that social

security is considering right now. >> so you do not think they violated the law when they did not send one in the mail? >> we do not have an opinion on whether they violated the law. we prefer to let the court make those decisions. we do think it is very important that people get the statement, and when the decision was made back in the spring not to mail the statement anymore, to cancel the contract, it was made for budgetary reasons, but it did not consider the fact that there could be a full calendar year in which statements are not going out. >> what does the law require social security to include in that statement? did they do it online? >> we have not seen what they are putting on line yet. they show what you are earning

record is, that estimate your future benefits, and talk about the offsets that apply to public employees and some in the railroad industry. there are many things that social security must include their, and we do not dispute that. we are concerned about how those things are explained. >> thank you very much. >> thank you all for you testimony. i suspect we will be calling on all of you for your ideas in the future because i believe there is an appetite to discuss how we get to a solution on social security, so thank you very much. the story you recounted of the woman in oregon sounds familiar to the story i hear from to many seniors in my congressional district in los angeles, where the costs are probably even

higher than the one you mentioned. if you look over the lifetime, if someone lives into their 80's or 90's, that is quite a few years of collecting about $14,000 on average for year. >> 12,000 for women. >> we do have to address that imbalance for women. when you put medicare in there, is a good chunk of money, but at the same time, we are finding that health care costs are eclipsing any cost of living that seniors are getting. $14,000 is not much to start with. how do you see this going? if we get to the point of trying to deal with making social security stronger into the future, so that my kids and their kids know it will be there the way it is for today's seniors and for me as well, what

should we be doing to try to make sure that we can tell the woman in oregon or my constituent in los angeles that social security will be a strong tomorrow as it is today? >> i think there are two separate problems that need to be looked at separately, although they are often talked about together, social security and medicare and medicaid. health care costs are on a trajectory of increase that is unsustainable. it is not just the federal health programs. health care costs from the federal programs are rising more slowly than health care costs in the private sector. there is a real need to control the growth of health care costs to see where we can find real efficiencies without impeding benefits in the quality of care. i think my expertise is not in health care reform, but clearly that is an area where we do see costs continuing to escalate.

if you look at the growth curve for social security benefits, the chairman pointed out in his announcement of this hearing, they will increase to about 6.2% of gdp in 2035, but after that, that actually declined slightly and stayed stable for the next 75 years. when it comes to social security, we are dealing with the back of an aging population, but it is more that there are not as many young people as there used to be. so how do we deal with that? i think there are solutions on the revenue side. the wage base for social security is very low. we tax a much smaller percentage of wages than we have taxed in the last several decades. a lot of compensation now is outside of social security taxes

altogether, and we are taxing only a small portion of gdp. there are revenue solutions and there was testimony about it a couple of weeks ago. there are other ways of raising revenue for social security. it is striking, and i mentioned some of the public polling that across the political spectrum, including people who support the tea party, support raising revenue to finance social security and close the deficit. they also support revenue increases to strengthen the program. i would suggest that is a place to look. >> mr. chairman, you are a number sky. we have to look at these numbers. you mentioned the $2.60 million

trust fund and how we address the long-term ally of social security. i pulled out the $20 bill, i pulled out the savings bond, and i guess i could have pulled out the treasury certificate that the social security system has. what is your sense of how we deal with this is insisting be existing debt ceiling crisis, and what is the impact on the $20 bill, the savings want my daughter has, or the treasury certificate for social security? >> we actuaries are focused on the social security system itself. our realm of focus is the system itself. we are in the midst of preparing a detailed discussion

breed of the very question you asked about the trust funds, is the money real or not real? what are the attributes of it that can inform some of our thinking about the importance of that $2.60 trillion? we are close to putting the finishing touches on that. >> mr. chairman, thank you. are really do not know where to start. i am extremely frustrated with the rhetoric on this issue. we heard three accusations of republican plans that are going to ruin social security. none of those proposals -- we have a lot of attention today because the president has recognized this is an issue that and should be talked about and debated. everyone i talked to back in north dakota is concerned about social security. it has been used as a political football by different people with different interest all along. i sit here today and hear people

say we have 2.6 start chewing, nothing to worry about. the reality -- $2.60 trillion. to redeem that comes from the general fund. why are we in this debt crisis today? we have $14.30 billion in debt, and we do not have any more money. the money has to come from the general fund. it is crazy to say that we should ignore this problem. i am not here to say we want to use social security to fund our deficit. i did not create this problem, but are frankly, it has got to be fixed. we are spending more in the general fund and we are taking in. i came here to honor that promise to our seniors. i am very frustrated when i sit here and say do not worry, we are good for 25 years, and at the end of 25 years, it is only going to go up 25%.

25% goes from 20,000 to 15,000. i appreciate everyone's perspective. the point is, they quit doing the statements. why? they are saying for budget reasons. everyone i talk to that has looked at this says there is a problem. my question is pretty simple. i would like each of you to say what is the facts? why should we look at this? give me a fact that is not disputable on why we should spend our time fixing social security or making insolvent long term. >> absolutely. >> the time perspective in which the system will run out of money if we don't do anything is within the life expectancy,

roughly, of people who are returned today. so is an issue that is going to affect almost everyone who is stepping into retirement today. it is also within the life expectancy of everybody who is working, over the -- or the overwhelming majority of people who were working. the trust fund will be depleted under the projection. there will still be tax revenues coming in. the trust funds will run out of money. it is within the people today who are here participating in the program. we ought to fix it before we get to the cliff. you do not put the brakes on at the clef, you put the brakes on as you are coming to the cliff. >> i would echo that, and what i think other panelists have said this morning about the need to address it now rather than

later. to suggest there is not an issue is to suggest there is nothing to address right now. the academy believes action should be taken now to address the long-range deficit. >> there are a lot of features of social security that are badly targeted. a lot of low income women really suffered discrimination in the system. there are fixes like that that we need to make, regardless of imbalance or not. so much money is concentrated so much earlier in life, so typical couple getting benefits now for close to 27 years, going on three decades. that is not a good system. they need more concentration of been a bit later in life. what happened in the trust funds is that while the baby boomers were in the work force, they were paying about $1 for every

90 cents that was being paid out. today, basically for every dollar coming in, $1 is going out. as you move toward the future, it moves toward $1.25 going out for every dollar coming in. that is the simple math we are dealing with in terms up this pay-as-you-go system. the trust fund is going in the opposite direction. that is what is driving the system, largely because of the decline of the birth rate. the only way to do we did address the decline in the new fisheries is to tax workers more or take something away from the beneficiaries. that is the simple math. >> i will let each of you make a short statement if you desire. >> one of the most popular options for strengthening social security, and i agree that action should be taken, in 1983

congress waited until social security was in of the months of exhausting the trust fund, and that is not an experience anyone wants to repeat. right now, people pay social security taxes only on their first $106,800 of income. when you explain that to people, the vast majority are shocked. people say people should pay social security taxes on more of their income, and that would go a long way to strengthening the trust fund and making sure we continue to pay benefits that are so important in north dakota. >> apart from anything happened -- happening -- there is an imbalance of the social security

system picks you get the least fair and outcomes if you wait until later. i would make one final point on this. if we do wait until we are close to a trust fund depletion, there is no historical precedent for closing a shortfall of that magnitude. in 1983, incumbent outflow were still pretty close together. we are rapidly getting to a point where they will be much further apart. there is no historical precedent for closing a shortfall of the size it will be by the time the trust fund has run down. >> social security touches the lives of nearly every american. it is a crucially important program. yet for 15 years, gao has been talking about the structural imbalance in the system and that it will be really important to act as early as possible to avoid really horrible choices later on that will really hurt people very dramatically.

we have been arguing that having this discussion, and i congratulate the subcommittee for having this hearing and raising some of these issues, is really important, but we do need to make decisions, and everything should be on the table. >> good testimony. >> you started to touch on private pension reform toward the end of your remarks. could you elaborate on that? >> in great britain a few years ago, they undertook a social security reform and they actually had a white paper study on what they should do. they concluded that it would be useful to try to increase private savings at the same time as they did social security reform. it increased benefits in the public system, but even there, they decided that was not enough.

to really help people, we really needed to build the private pension savings. if you look at the private pension system, it covers fairly poorly most of the population. i have not quite updated it, but it says that for 75% of people that retire, social security and medicare is in excess of all of their private assets. we have a larger extent of the population dependent upon social security and medicare. how do we deal with it? one way we do what it is be tried to increase some of those cash benefits for lower and moderate income people. from the middle-income people, i do not think we can get thereby adding to a system that is out of balance. we need to recognize that

private retirement system is not doing a good job of covering the vast majority of people. it is almost beside the question we need to figure out ways of enhancing the savings of middle income people as they move towards retirement. >> thank you. you mentioned that there is public support for revenue increases to social security. could you elaborate on that? >> the raising the cap on taxable wages is certainly one option that is very popular. there are also at some polls that to people say, i would pay more in social security taxes to strengthen the benefits that people rely on. this is one area of tax for people say, i do not mind paying social security taxes

because i know what i in bidding for it and i would pay more to protect social security. in the past, in terms of automatically legislating for need and the future, there has been scheduled small increases in the payroll tax to make sure that social security stayed in the balance. this is something the public says they support some of the proposals for improving and strengthening social security were part of the discussion. again, i am not saying wait until the last minute. i agree with chuck. it would be very bad to wait. if there was a process of public education about how we are strengthening the program, making it better, making it more adequate, everyone is going to be chipping in a little more. people who are very wealthy will be chipping in a little more. i do not know whether it can be done without increases far in the future, but this is what the

american people said they want. they want a stronger social security system and they're willing to pay for it. >> what would determine the very wealthy? >> at this point, everyone of of about $107,000 is not contributing to social security. >> contributing to social security? >> you're quite right. it is the end, above that amount plus other forms of compensation that are not part of the social security base. >> ok, thank you. i yelled back. >> -- i yield back. >> thank you, mr. chairman. in the last 24 hours, we have begun to hear about the concept of cpi instead of the

traditional method. could each of the panelists talked a little bit about that concept? maybe describe to the public that is watching this hearing, described to them this concept. why it might be an important part of the solution to this problem. >> there is been debate about the cpi. what is the appropriate cpi? there is concern about what is in the market basket to value what is happening to the price of the goods we consume. the argument basically between the chain cpi and the current cpi, in the current, many people did not believe that we consider when the price of goods -- let's

pick out a car. if the price of a mercedes goes up, maybe you do not buy the mercedes. you bite and -- you buy an audi. the current does not take that substitution into account. it extends to things beyond too expensive cars. the argument is that this new cpi more adequately reflects or more closely reflects the cost of what living is over time. the problem with any market basket is that you pick any specific individual and they probably did not exactly consume that particular market basket. it is an estimation to try and get as close as we can to a reasonable rate of increase in the cost of living for people.

the argument is being made on technical grounds that we should move from the current system to an alternative system. >> the question about what the proper mix that goes into a basket of consumer goods to accurately measure inflation and its impact on indices, i will say that we have -- are aware that a change c.p.i. would likely produce a lower measure of inflation will work to the point where if it were to be implemented and used to inform the cost of living adjustments, it could close as much of a quarter of a long-term deficit. >> i tend to favor coming up with a good measure of c.p.i.. i think it causes problems and

social security. that is because for people who have not retire debt, the adjustment does not affect their growth and benefit. your benefits keep growing by 10,000. that does not go down. the cpi gets people once they retire. when the first year of retirement, and if you have an adjustment it might be one-third of one%. that compounds. the person who is 85 or 90 has a 10% cat. you end up with a much bigger cut on the older elderly. i want to make the system built in the opposite direction grade i want to increase benefits at older ages. i want to cut back on the benefits at early ages. my problem with doing acp i only without worrying about that issue is that i want to backhoe

the benefits. i want to protect the really old, for whom there is not much incentive to work because they cannot bear it that is -- because they cannot. >> the problem with switching its -- for social security is that it is a program that serves people who are elderly and people with disabilities. it also serves them children, but the vast majority of beneficiaries are elderly or people with disabilities. what is different about them from other consumers is that they spend twice as much of their budget on health care. that is for all people 65 and older. for people 75 and older, and they spent 2.5 as much as consumers generally on health care. the reason that matters when you're trying to figure out what the fair cost of living adjustment is that health care

costs rising much faster than everything else. a few are already spending a much bigger share of your budget of something that is rising much more quickly, a cost-of-living adjustment that might be fear for other purposes or for other people is really systematically on fair to the elderly. in fact, the euro of labor statistics -- >> your time has expired. >> finish your statement. but the euro of labor statistics hide a special c.p.i. for the elderly. by that measure, our current cost of living index underestimates the cost of living increases that elderly people experience. >> you are recognized. >> thank you, mr. chairman. thank you for hosting this important hearing on a very important topic. it appears that there are some

in this room that believed in a policy of the ostrich. did your head in the sand along enough and it will go away. the reality is that we have a problem. i think he might be best to answer this, doctor. we hear about the fund eventually running out. remind me again how many years is that estimated to be? but the latest estimate is 2036. about 25 years. of 25 years. you said earlier that that is likely to be -- >> 25 years. >> you will be around 50 bad. >> board willing. -- lord willing. in 2036, we deplete the assets. in 2037, if you are a recipient

of benefits, and you are to get $1,000 a month, what happens? >> the next month, you'll get $750. >> $750. that goes for a year? >> you get a monthly check. >> the first year after the year in which we deplete the assets, we go down to 77% of being able to meet liabilities. the second year, what happens? we have accrued 23% of last year's liabilities that we have not been able to pay, so now the second year, what happens? bucks under current law, social security cannot borrow money. social security would be making payments at that juncture. at the rate at which money would be coming in. the rates are projected to be relatively constant. it would govern -- it would

governed along somewhere along 75% or 78%. of course, if we have one of the happy experiences which we may have some time in the future like the one we have been for the last couple of years, and revenues drop significantly, it might not be 75%. it might be 60%. no guarantees. >> what i am having a hard time understanding, why do we continue to send statements to people who might be around 50 years from now to tell them to expect a certain benefits when we know today at the truth to be that under the current system, they cannot -- they should not base their retirement on the current expectation. >> the statement has included generally a comment to the

effect that the system is underfunded. congress is either going to have to do something or benefits could be reduced in the future. but the reason they cannot send out a state mental to people who are 50 years old or 40 years old and sick, by the way, here is one calculation. your benefit is only going to be 70% of that. because of the letters that those of you sitting at this table when it did in response. >> isn't that the truth? it isn't current law said that based on the current assets and 2036, they will only get 77%? >> the revenue aspect defining how much is going to be collected and there is a benefit formula aspect to it. a lot says something right now

that is inconsistent in these two segments of its corpus. the general public does not have a complete appreciation of what is going on. generally, they know something is wrong. we go off and we propose to them that there is some magical solution. we hear all the time about these surveys. the public would like to pay more for social security rather than having benefits. how would you like that done? tax people who are earning more than $106,000. that is not the american people, not the american workers bang for the. if you look at table to in my presentation, the people they want to raise taxes are already getting back less than 50 cents on the dollar for what they are contributing fdr thought this was wrong. the early architects thought this was wrong. robert ball repeatedly said that these low rates of return are

wrong. what they are talking about doing is exacerbating it because the american people are willing to pay more taxes. >> i see my time has expired. it seems to me to send out a statement which we know to be false under current law -- when i retire, 40 years from now, i should plan based on my current income to receive $3,000 a month. it says, is social security in trouble? no. it went on to say that under current law, it is required to meet the obligations. all i am suggesting is that for someone who was not in congress, who was not privy to this information, but only privy to the statement by which they are sent from the social security administration, i

think it is disingenuous and it is misinformation bread it is similar to a ponzi scheme that we send people to jail for. i appreciate the chairman's continuation on this subject and then look forward to working with him. our ranking member when he realizes we have a problem and tries to help us fix it. >> i realize the problem, but it is not social security. that seems like all of our witnesses think our social security is the problem. thank you for your comments. i think this has been beneficial to all of us. thank you for being here today. in 2036, according to you, 75%, i am told 77%. congress and the president need to find common sense solutions to make social security secure,

sustainable. the sooner we do so, the sooner we can protect those who are most vulnerable. thank you for being here. the committee stands adjourned. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] what's this weekend, it is everything you know about the ok corral wrong?

he tells a different story. former mexican foreign minister talks about the challenges facing our southern neighbor. look for the complete schedule at booktv.org. >> c-span has launched a new website for politics and the 2012 presidential race. visit us at c-span that auric -- c-span.org/campaign2012.

>> betty ford died this evening at the age of 93. she talked about her time in the white house. this event last 25 minutes. and i enjoyed a longstanding relationships, one that goes back as far as january 1949. being here today in this magnificent building that pays tribute to our wonderful good friend is a very good -- a special honor. it is also a very touching moment for me because we have been here on many occasions that

were not quite so happy. on january 3 of that year, 1949, my husband took his first oath of office in the house of representatives. i sat in the gallery and we were just newly married at that time. i was very proud as he raised his hand and swore to serve this country. interesting enough, what i remember so vividly that date is watching another young man, young congressman, approached jerry to congratulate and welcome them as a new member of congress. that young man was richard nixon. that moment began a friendship that has been treasured for many long years. as i think back about the years

that were so political iraq -- politically active, i realize that the event that had the biggest impact on my life was the day my husband took the oath of office as president of the united states. nothing can compare to that moment. i did write about it in my book. i wrote about it as the saddest day of my life. president nixon had resigned and the first family were leaving the lot -- the white house. it is a day that i will never forget. today has provided me an opportunity to reflect on our many years in washington and all the wonderful times we experienced which led to the privilege of are serving in the white house. before my husband and i ever started our journey to that wonderful a historic house, everything was quite different. : congress was always to

become speaker of the house of representatives. in 1973, jerry began talking about serving one more term and then retiring. that sounded like the most wonderful idea to me. [laughter] as we began our planning, it never dawned on us that outside influences might rearrange our plans, and not just slightly. when president nixon was considering his selection for a new vice president following mr. resignation, i was very aware that my husband was on the list for consideration. i did not give it any serious

thought. i was sure his position at the republican leader was much too valuable to president nixon for him to be a contender. the ford family, we went about business as usual correct -- as usual. everybody but our daughter susan. she was totally convinced that he was going to be packed. we humored her. your father is certainly the best man for the job. we were very sure that he was wrong. we had some bets on its bright president nixon had announced that he would make his selection -- we have some balance on it. both houses of congress were to meet there at 8:00 to hear the announcement.

we had the usual quiet family dinner so that he could get through early and be in place in the white house with his colleagues at that appointed time. but during dinner, the phone rang. it was president nixon. just as susan knew it would be great the call came from the white house. the call came in on our private childproof line, which had no extension. by talf prue, i mean that it came with a death threat to any child who dared to use it. under the circumstances, citizen sprinted of stairs to the phone and called her father. and then things began to get really confused great president nixon told jerry that he wanted to speak to both of us. he asked my husband to have me

pick up the extension. that is the non existent extension. attempting to remain in control, he explained the problem. can you call back, giving him our phone number? [laughter] then he hung up. [laughter] he came back down downstairs and said, president nixon was going to call back. he also wants to have you on the phone when he speaks to me. we waited for what seemed to be an eternity. i wonder what we had to have done if the other phone -- i often wondered what what had happened. that called not only changed my life from being a typical suburban wife of a member of

congress into the vice- president's wife designee. within half an hour, i was supposed to be ready to be at the white house to appear on national television with my husband. guess what. i had nothing to wear. [laughter] i went upstairs and we went through my closet and i threw on i trust that i thought was suitable for television. -- threw on a dress. it happened to be green. i did make it to the white house in time to slip quietly in my chair. it was half a chair with pat

because someone forgot that i was coming. everybody had to slide over a little bit. in my excitement, i hardly noticed. i was so excited to be there. after weeks of endless investigations and hearings before the senate and house committees, jerry was finally confirmed as vice-president. once he was sworn in, i start i fixing up -- it was recently designated as the official residence of the vice-president. the vice president had never had an official residence of to that point. they had never talked about it, -- they had talked about it several times, but they had never been able to come up with something.

it needed everything from new wiring to a leaky roof and silver, everything. as usual, that involved a great deal of detail. but it was a lot of fun to do and i had a lot of guidance from people from the state department. things did move so quickly that i never got to live in that house. before it was ever ready for occupancy, we were living at 1600 pennsylvania avenue. in a very lovely historical home, the home of first families. as the incoming first lady, i was quite fortunate. i was not a stranger in town and

i had many good friends on both sides of the political aisle. i knew most of the members of the press corps. the only change, i had to become accustomed to my important new job and i had a new mailing address. that was pretty exciting. suddenly, i had graduated to the highest notch on the washington totem pole. first family's of our country -- first families of our country are only temporary residence of the white house. the white house is the house of the american people. the professional staff, many have been their most of their adult lives, served from one of administration to the next. giving each