>> if they do not, people things into their own hands. >> anybody else? yes, you, madam? you would like to use the microphone. . find now one single sectarian by syrian activists. you to parts equally. it is a regime empowered by extreme fcend civilians fighting against it. reform coming from within the regime -- >> what is your update, what is

happening? is it three weeks to decide be syrian uprising? >> no one can know what the future wl happen will t. think that is realistic. on the now? how is e situation right now on the ground? media, we don't know. we don't kw what is going on. slogans of werthere from day one. many. een them, we have heard them, and if they are not reported to you, i don't know who your sources are.

second, a lebanese colleague of hamas and he said is the kind of part of syria. the media is not reporting. >> how can we if we are not invited in? >> look, some bbc journalists did. >> not buy a vacation. invitation. views. thank you for giving yours. it is largely your fault. that is not true. with sectarian slogans. the people he is referring to honest, going to the sunni majority, that is simply not true.

1971, when the hamas, they about 30 sheet for the president. but put that to one side. >> the protesters have been keen not to do anything that might be interpreted as sectarian. calling sectarian languish describe the population that way. bombarded the bombarding the hamas. update of

situation on the ground, but panel wants any part of that? we want to know your updates. have you missed an important point? sue? you mentioned one. of secrianism and the country. i have heard sectarian slogans demonstrations, anti-regime demonstrations. they are perhaps maybe one person and the crowd shout something, everybody else says, not what we are about. are here as one people against the regime, and this is feeling. >> when we talk about the vision to look at the various divisions. of them are economic as ll as sectarian.

i was speaking with various people, and it was interesting, but sectarian violence that took place took place in the poor neighborhoods, a recent economic to the city involved. it is not the establishment that had been a longtime, the class, it was a small segment of an economic strata of society. is often missed by the media. that there war blooming or under are casualties in the city, but you don't want change, the rest of you want change. we will come to the regime in a moment, but for now we'll talk about the protestors. you have been living in damascus, daniel, as a westerne who do you think the protesters are? has the right to tell us who they are? the second part, i think the only people who have the right determine who they are are

the protesters themselves. as i mentioned before, it is a disorganized movement, and different actors, different people involved. are exiled groups to have with networks within syria. there are also local coordination committees who over become organized but began as a groups of mostly men. there is a women's movement. it is an entire spectrum of people's movements. sue? a movement of discontent. make a basic point, forget the of syria and indeed much of the middle east. 60 percent of the population are under 30. the perception i got from some to in syria

frustration status quo, corruption, the inability to get jobs without bribes or knowing the right people. they get very impatient with the government's paranoia of always outside forces. i was told time and again, the discontent, the humdrum of every day. >> how these disparate groups communicate? social netwks, al-jazeera english was an influence in egypt at the time. how are the groups in syria communicing? facebook, social twitter, and also of communications, arranging and coffee shops. , there is not a coherent organization.

>> how would you answer the question, who wore the protesters? top-down revolution at all. embryonic stage, civil in syria. have emerged syria, first at a level, the which now they are organizing on a city wide or level and now a national level. the young people in syria, but also women's groups. been very active in revolution. acte figureheads in syria at the met are women.

-- at the moment are women. a very diverse mix, but i comes under the of civil society vs. the the regime. describe the battle in syria at the moment. >> free people against militarized society? >> absolutely. , said, who for dignity reasons they did not policeman anymore. equal opportunity in on, so you have these factions. faction that is think, from the outside. with regards to this particular certain on the

presence. example, when i was in damascus and a couple weeks driver said -- we restaurant, and therwas a demonstration, pro-government demonstration at time. the taxi driver said, don't you think this is provocative? some people are dying and the people saw the burning in the streets? said, yes, well, some of those out on the time seeking to much. at the end, we may not get a democracy at all. .

dignity. but there is the economic problems. a lot of people cannot find a job. that does i will have an opportunity to express my skills. i will have to be friends with someone. >> are you saying people are because they want to be engineers? >> no. they're frustrated. >> wire they putting their lives line? >> they want a regime change. >> that is their right. is feared how the change regime, from the inside? -- it is. how do you change the regime,

insectinside? you know? i know what people tell me. houses that be ended very soon. what you said. in syria, the biggest and most force is the regime. they have used the different sections. there is always one person from here. they use a very cleverly.

beirut. >> pointed at your mouth. some interesting with close leadership. what i heard gave me the impression of what is going on in syria. contained. it'll stretch out to lebanon and turkey on the side of the turks in the north of syria. from the protection to come in.

i read the slogan. thought it was important. the have fled to beirut having an uncomfortable time. were knocks on the door.

>>hat do you think they what? there be a very clever in the they use it themselves. change the regime. we have to keep the existing power structure. we may be need to curb some of the become part of the government. this is the road map. this is the idea that they can stay in place.

lives can go on. judd a madinajad. a people have their rights for the assets. it is natural for there to be a reaction. it is illegitimacy. there once call on these

external forces. they're saving give for the syrian people. they will be fighting it. the existence is impressed. >> some people have suggested this. i wanted private regime. >> the question to you is, what do they want? in highlighting this. they initially just wanted to

reform the regime. a key point is being missed. it is not necessarily about two is on the street but who is not the street. there are a key geographical regions. the uprising. is the question. they uprising, it cannot possibly proceed. >> why are they not joining inde in? they s they do not like the regime. we did not like them in power. we will not there out are lost opposition and so we convinced where it will go. is whether

the military and forces will stay there. three options will happ now. e crack down. it'll terrify pple into submission. the third option is that they refuse. biggest is the appeal in egypt. yemen or libya. there's something from turkey. there are embassies about not that is there. >> can you give this a briefing? after it came out

of syria. this. has been the senior officers. this was quite close to this. there were towns that were hits. about one month ago. there's a parallel army. who knows if this will go away. >> the problem with the milary is that the machine has a bill. it was designed there. they separated the powers.

they're all spying on one another. the high positions. that means the chances of it affecting it is far more diminished than the bottom level. is far they using the for the republican guard. be fiercely loyal. fight tthe death. they are largely being used in widespread ones. what is interesting is whether not you get mulple urces uprisings. >> thank you.

in terms of internatnal reaction, these are the things that could happen. it. it is the sense that people may ken be held to responsible. this is what they're picking up. made no difference whatsoever.

g at them. . do you think they're right to do that? the army and the security at each other. on with an ambush in the army on the way to beirut. tt at

all. there's overwhelming video evidence for t deliberate people, women, and children. a 10-year- girl who was shot. there's a very graphic video. we showed it anyway. the reality of what is happening in syria. it is very difficult.

with cannot always hear you. did you want to answer his aspect? >> i will not suggest the revolution that started five been 100% peaceful. said it is 95% peaceful. >> is this is a small question. can give you an update. this was reported the bbc. they have not been shown. we will move on to the regime of. it is common to talk about this.

down to a family. >> they are quick to answer th. really have confidence. they have huge optimism. think this is a new one.

this has accelerated the process. we believe that you can reform. show us. when he did not, it reaches i. have pointed there. question about doing this. akin to a family. nobody really kns. nobody knows if they're calling shots are these are among the small group. about the regime.

prisoner in his father's prison. i wonder if we did talk about whether that is right. link was there. brother that was not supposed to takeover. family? >> it is interesting. make it there. it is the different.

security army forces together. dependent on the various clans surrounding it. is one more thing about the reformer. it is quite possible that he be overwhelmed. he is not a politician. goes

there the process. and he learns how to role in many ways. that he is a weak demand. the army? the army supporters as 1975. he is calling the shots. he came to power.

he made the change. still in power. listen to it anymore. is very hard to do change. there is a mass of people. top prime minister position. >> he was a prisoner. >> and he is planning this. reason. >> can give the 10,000. >> it is made up to scare people.

they had taken to the streets. the end products. is about freedom, democracy. these are very simple questions.

i think the way things are. >> would you like to comment deck'? >> was the most popular is this. people are actually cursing. it is the first wheone that they have. it is the system. he decided to live with a continue. this is the system.

they explained why there through this. anyone that was a loyal, is there. did the minister of defense. he has been t into the government. there will never lose their jobs. they're quiet comfortable. there is aemocracy. they're completely ineffectual.

there are these militiamen. another extreme, you had a scholar. he said it iok to about down. there's a wide spectrum of people that have been coopted. >> there's a widespread ceiling. there was a plan. they have this.

they are unified. this is not a process. there was a process that should fall they're being justified. that backing that follows is dangerous. >> would you comment on the what else is there a? one of the things they have base themselves on is a they have grown its roots. nothing goes on in syria without touching the regime.

most of us have had enough. they do not have time to think about this. they will keep this for another 40 years. >> i've been impressed by the democracy. they're quite proud about what they achieved. the message was sent out.

they d not have much experience. it can be a bottom up process. >> what happens next? >> until you action find out how it falls, one thing tt is difficult is what is it about? they say they are trying hard to separate the army from the security forces. they're trying to stage a coup the problem get a situation where they go beyond the armed forces. probablyy, they're trying to protect as many assets as possible. if that does not hapn, but there's some sort of violent confrontation.

do not underestimate the ability for a conflict to change the objectives of people. >> we have that from pro- democracy people in egypt. it is another army person. what about the deaths >> it had a democracy for a while. >> what could replace their aging? let's there is the type of that we have. it should be game on. the re-emergence of civil society has an alliance between businessmen and clerics. >> who could believe?

>> i could name me some names. we will be free of elections. >> we're very much occupied with three or four people at the top of the regime. they are not the regime. the regime as hundreds of thousands of people. if you kill the president and his brother, that is not changing the regime. >> to you think it has the capability to that minister a whole approach that is it too late? -- to administer a whole approach? is that too late? >> several top members of the government are backing off from

what has been done. they were tricked. since then, if they have had to live in exile. this is highly unlikely. >> they were misinformed. he was not sit on a mission before. he only did it after the assassination. perhaps i got the name wrong. so far, the response has been mixed. what do you expect? is most afraid?

is the regime was fearful of? would you like to tackle this tax quite sick and ask a not at this moment. there's nothing worth fighting for. they're most afraid of turkey. this 10 years ago. factories and employ others. s we invested in me.

>> we demonstrated this. tackle that is about engagement. it is not that they did not have is another element in deed. it may be fair to mess up.

>> israel is not the enemy. they are a great friend for the regime. this is the excuse for everything. the march into the west bank. it is really a huge benefit to have israel there. of yes, i deal with turkey.

essential damascus. they're not able to contain it. plexus the second time you attention to this. you're saying this undecided middle is it. >> you have very small protests. that is your tipping point. about for the armed forces to contain it. that is too great a number to impress. >> i keep hearing over and over again. lot of demonstrations about it. to go to those areas.

-- there was relief in there. because the private sector is considerably larger other problems are cities in syria. have been if it did. -- benefited. losingheir jobs. there on thursday, there was a shutdown. they would have the area itself.

it is in order to defend what best. -- it is to demonstrate. >> syria is a part of a chain goes there. another important link in the chain was libya. if no one said anything about that might impact syria. will lose some support? there is a three legged stool. could this affect the regime? this to be something by the opposition.

>> how was the economy doing? was the economy supply, they're about the regime. you keep mentioning the economy. to give this a briefing? not in good shape at the moment. bad as making out. they like to get a narrative with all the money running out. the currency will devalue. you're seeing a decline in economic ability.

consumption is down. all this was through the roof. a bad couple of years. there's still trading with turkey. 25% goes the. this latin thousand barrels a discounts. while the economy is looking bad as it is. many new about ?

>> their 9 million people demonstrating. it, you would see a lot more people. in terms of linking it, there rumors about this. ? >> we are with you. is

people will be thinking it. they probably do not want it to fall. >> we will go talk about possible outmes. if you are missing things became into a room hoping, but do that now. then we will go to possible outcomes.

>> i have a question that relates to the future. single day there women the first time. there this kind of movements in syria? much too difficult for them fact? >> it is far too difficult. the it is very difficult. this is the strength of the

movement. although there is a lack of education of how to do things. there is not a need for educational programs. reporting this that they were being focused on people inside.

besides they said they cannot do anything. >> if you protested out, what happens to them? >> people told me they were protesting. people then received enormous phone calls. they said their relatives. they're telling them they have to get your people in london to lay off. it has to stop people from doing that. >> we did a report. it has serious repercussions.

what about scholarships and travel bans sex with you just answer this question that we're moving on steel in a moment. >> i think this was exaggerated. the problem is that you're not hearing it. they were outside the embassy. this is always the subject of intimition. they were threatened in front of the embassy.

>> perhaps. when those people visited, it was interpreted by threatening. they're calling things down. they know people personally. >> we heard you. i think he is a diplomatic one. that happen. >> it is someone who s that wh he does not go around intimidating. i don't think he ever stepped out of it. >> there's one very d tel acquisition about the behavior.

we're moving around the audience. the do not need to be disappointed. >> the action is sold the regime. what support do the protesters have? >> there the king to make it about a fifth of all employees. there is a war that th will run out of money in it thathey do they have to pay the security forces that do. i do not know what they were to do.

>> i would delegate that. i would not want to come in on the deficit. >> this is something i heard from proteers when i asked the question that journalists always do. i heard me and time again that is playing into their hands. this is our problem. they have intended the recent protests. others say no. it allowed them to go by former

lonial power. >> can anybody comment on how the rest of the economy is being affected by a reduction there is a complete collapse in tourism. can anybody comment on the position? >> i just wanted other times. they're running out of money. after the 21st of june, there were demonstrations. they are refusing to go to the city.

they are ccking everybody. people are trying to take their exam. inside the selling city. >> when you said they have not seen anythg dx tt brought to mind this. this is what you're referring to? they have much better intelligence on the ground.

>> that cannot comment on it. what don't you want to comment on? >> they were not on this. their outside shooting in. it seems pretty unpleasant. do you think that the government could go further? you have to be brief. >> as winning if the government could do more. >> do you think it is a surgical military response? >> they have not the least the full potential. they do a lot more damage. i think they're willing to fight to the debt.

-- death. they know if the regime falls, its the mother of all revolutions. there is a morally corrupt system. many more people will die. i am sure. >> for people who want to share solidarities some how, there is the embassy. >> thank you for your question.

let's seek the audience reaction. is there anyone on the panel that wishes to disagree with that statement? keebler saying that there will not be any. it will appear to dig people are saying that there will not be any -- people are saying that there will not be any. >> turkey might bring it to a bubble on the northern part. >> i'm not being rude. what do you know about it? is it because of the refugees stopping there that they have to make some kind of response? >> is a not be entirely for the befit of the syrian people.

we do have the issue of a lot of refugees. turkey does not what trouble to spillover. we're coming to the conclusion. would you like to give as an outcome? >> i am depressed. people talking that they did not want outside intervention. we have seen a largely ill- equipped protest movement. government has prepared to put it down. they have nothing to fight ba on. and did not think it be the outcome for most of them. >> do you think there are more

skirmishes in which they are killed by this tax we're not going back. you have a microphone. there's some pretty bad news. there were a thousand strong executives. it is a weakling.

i can see two possible outcomes. they hit a deal with certain elements. if you continue protesting, this was the war and everyone would be a boozer. we know there are opposition leaders. this is a different issue. the other scenario is a low- level civil war. i think it would be similar to

what happens there. these attacks were isolated. the debate should be difficult for the army. it is hard them to remain there. >> do you reflect what we have heard decks t? do you think that might have been? >> if a suddeassad is not emerge winner, and do not see how it would be strengthened.

i owed reminded that there is historical flavor. >> your zero possible outcomes it is sooner rather than later. civil war is unlikely. anything can happen fairly soon. the current situation could continue for some time.

>> i am pessimistic on th. and of the underground movement is well developed. what people feel as if the government will do some of the political situation. >> i would forecast the situation. they have a lot further to go. this is what they can stomach.

i think it will grow. they will not reach the critical mass. there will be some kind of internal tcoup the problem with the opposition is about that there leadless. local committees, basedn region, will have to solve the deal. that will be difficult. >> wha heard all ideas members did not respond well to. a daily limit would be your word. >> the regime are not as stupid

as a lot of people make up. they are aware of international opinion. ey're also aware of how many gaddafi killed, and feel that after a certain number international opini turned quickly. there is an issue with the number of people who are seen. >> you do not have a micropho. we're going to giveou one. yes you do. there are people watching all over the world. >> i have a question. who supports these armies? how are they employed? how'they control the demonstration? how many%, after five months,

are in it? how many have accounted? >> it is quite a lot to get through. you're saying there are many military but not many protesters. would you like to follow that? >> the last five days, estimates of about 3 million protests, 24 million who risked their lives to demonstrate. the answer would be to hold a free and fair election. i think that is the best thing to do. >> and said you could ask this lady a question. you can after the panel. there will be time. we have heard a great deal from the panel tonight. iraq is selling discounted oil. turkey may cross the border.

the protesters are desperate but determined. we have heard predictions of status quo. i hope we have had a full airing of views. i would like to thank the panel for ging us a briefing, f helping us an inch further from understanding the situation. thank you very much. >> tonight at 8:15 tomorrow we will be live as the young america's foundation national conservative student conference. some day, it is the chairman of the house foreign affairs africa subcommittee chris smith who will discuss how the u.s. is addressing the famine in somalia and aid to african

nations during a time of tightening budgets. that is sunday here on c-span. monday, "washington journal" begins a look at the week-long vision of the workforce in the u.s.. wednesday, a private public partnerships, thursday, federal job programs. that is all next week beginning at 9:15 eastern. >> this weekend on c-span2, the life and times of an attorney for the damned. live, sunday at noon eastern, three hours of your calls and questions. ann coulter. look for the complete schedule at booktv.org.

>> every weekend, american history tv on c-span3 highlights the anniversary of the civil war. this week, one of the most important documents, the and emancipation proclamation. is professor on abraham lincoln and of the proclamation's constitutionality. >> italian prime minister so for your polis' county address the parliament this week on the state of the countries -- italian prime minister silvio berlusconi addressed the parliament this week on the state of the country despite global concerns over the eurozone markets. it is about a half hour.

>> we will be resuming the meeting now. on the agenda is the informational speech by the prime minister on the economic situation of the country. following the speech by the president, the representatives of the political groups will intervene, front largest to the smallest, for 10 minutes each. to the floor is yours, mr. silvio berlusconi. >> mr. president, honorable congressmen and women, i am here to give you the status of the

italian economic situation. of the consequences of the international crisis and the decision of the government. everybody sees a that the problems of the emergency in these last few weeks are a direct consequence of a confidence crisis that shakes the markets all over the world. it continues because of the euro and the push of speculation. we need to confront this crisis firmly without chasing the anxieties of the market's because it feels them. r. country -- it fuels them. our country demonstrated that it was able with the opposition's

support to approve in only 38 days and economic maneuver of almost 80 billion euros, heeding the invitation by the president. we have solid fundamentals. our banks are liquid, solvent, and it easily passed the stress tests in europe. we also registered significant signs of recovery. in july, we have registered a significant decrease of the hours claimed for unemployment. compared to the same time last year, 28.8%. so, we still have the desire to invest, to do business, and to solve problems in our country. the government, the majority,

has approved on july 6 and economic maneuver that will in short through provisions in the short term the objective to balance the budget by 2014. this is a condition that will stabilize the debt and will progressively decrease intensity compared to the gnp. this is in line with the objectives set by the european union. eight was deemed adequate by the -- it was deemed adequate by the international observers. the chair of the euro group and also the european commissioner for economic affairs -- the

appreciation for this maneuver and i also had a long telephone call with the european minister who called me after the meeting. therefore, i would like to further analyze the situation for which we are here, starting with the trends of the planet to market. everywhere, uncertainty on the intensity of the growth in the world has increased specifically in the united states and in japan. even the strong productivity of the emerging countries is slowing down. in the u.s., in reaching its consensus on increasing the public debt ceiling and avoiding the faults, it has induced a reshuffling of the investors' portfolios in favor of short- term investments.

the bipartisan agreement [no audio]has eased international tensions. turbulences on financial markets have been fueld by the perception of an excess of slowness and the reaction of european authorities of the sovereign debt crisis. on july 21, the european council has approved a new program for greece which is aimed at insuring that it will meet its financial needs and improve lower interest rates, due dates, and with the involvement that triggered a lively debate of the private sector. the council also expanded the capability of the fund for financial stability to intervene

and manage crises with more flexibility and economic strength. these are decisions that are important. also, if the markets [no audio] on the importance of these deliberations. so it is essential to deal of uncertainty to market. we need to clearly define the time friends, instruments, and resources. there is a contagion influencing the choice is of institutional investors pointing them towards activity that is it deemed less risky. first of all, to the detriment of the other countries bonds. the tensions have extended to our country but not only our country. the same problems are felt in

many other countries of the eurozone. these tensions have increased the differential between the 10- year treasury bonds and those of the corresponding german bonds. in the recent issue of public bonds, the deals have increased by one percentage point as it often happens during crises, the market's overall are not evaluating correctly the merits of credit. investors evaluations of our bonds do not take into proper account the solidity of our banking system, the halsey asset base of our families and businesses, indeed contained foreign debts, the lack of imbalances in the real-estate sector, and the prudent followed

in budgetary policies during the crisis. these are strengths that have induced authorities to consider italy in the condition of total security. recently, this was recognized by the president of the commission whoasaid " i considered unjustified the pressures on our markets [no audio]the financial crisis. they endured large losses on credit. they resulted in a timely fashion to the capital markets. equipping themselves with resources they needed to confront difficult situations. they passed it in europe. also, the collection in the

european markets in the early 2011 was sufficient to address a stocks forin the whole year. today, the italian banks are well capitalized. they are able to satisfy the needs for loans of italian families. the deep rooted system in the country has allowed them to increase collections for families for deposits and obligations. relativity [no audio] by the expansion of loans by the improvement of the quality of

credit. the decrease in value of our bank stocks that are being registered right now are absolutely excessive. for the large institutions, the market value is today much lower than the budget value. and alos, the of the italian prime sector, the families, the businesses are collected by solid financial situations. families have the least indebtedness compared to the gnp among the large countries. these values are less than half that of great britain and the united states. their wealth is particularly high compared to the international situation. the debts of our businesses are

contained compared to their profits. today, if we add to our public debt the system of savings of italian families, we would go up to the second place in europe right after germany and before the sweden, great britain, and france, but let's talk about public debt. after the explosion of the our public account, it was more favorable compared to other advanced countries. in the 2009, the deficit was over 5% of gnp . that value was still lower than other countries in the area of. with of the recovery of the economy and thanks to the

accounts, they have approved -- improve typing in 2010, the public debt decreased by about one percentage point. the primary deficits were annulled. the budget deficit was lower than what we had envisioned as our budget which was our objective which was 5%. that was around 6.3%. the path of debt reduction agreed at the european level is going faster. that is what is what is requested, and that is what we are going to do. the u.s., u.k., and japan had deficits between 9% and 11% of

gdp. in may, we have defined a budget maneuver for 2010 -- 2012 that will take the deficit to 3.9% of gdp this year and 2.7% next year. in line with what had been said at the european level. the data on government needs for the first seven months of this year are in line with the objectives that we have set . the cabinet has set a path that will lead to balancing the budget by 2014. of the provisions were further strengthened in the parliamentary conversion into law. these interventions will allow us a rapid reduction of the debt

right under 113% in 2014. by linking by 2013 of the pension age with the measures in terms of social security, we further strengthened the solidity of the public accounts for the future. the reforms of the last few years set italy among the other countries where the pressure of social security will be the most contained. our pension system was appreciated and judged as an example for the reformation of other systems in europe. we know that there is much more to do. the effort to limit spending

needs to be rooted into measures. we need to have an immediate action plan that responds to the development of the market's. we need to consider measures that will bring to zero -- the financial needs in the latter part of the year. we need to improve the quality of the public services for regulation that affect our competitiveness. we also need to use our resources for investments, calling for the collaboration of the private investors, so it is essential that the government and the parliament and to amend -- parliament implement fiscal

mandates and modernize the fiscal structure of italy. but it is certainly -- it is a growth, the essential objective. the economic program in committee this morning implemented the plan for the south, giving 7.4 billion 130eau's to realize interventions that will launch the economy of the south. [applause] >> this morning, i also signed two decrees. the first one creates a government committee that will provide the necessary information to reach the slaraly

leveling of elected officials and officers. [applause] the second decree [no audio] -- and the limit of usage of the blue cars so as to reduce their number and their costs bank in order to reach the objectives that we have set in the meeting that we will have tomorrow with unions, the government will propose a collaboration for stability, growth, and social cohesion that will have to be in line with the program presented in brussels in may. the growth of the economy is the consequence of positive convergence of the responsible

behavior is of political and social actors striving to reach an agreement between the government and representatives of businesses and labor on the ways to realize a common purpose. this meeting will focus on four points. managing the economic maneuver and provisions for development, investment for infrastructure, financing to businesses, and industrial relations in the private and public sector. this situation imposes to us that we have to give a strong response on the commitment to grow that will make the stabilization plan credible. for this, i would like to anticipate the subject of our discussion with the unions.

the management of the maneuver will focus on measures that have been tested in to be tested. the joint monitoring of investment in infrastructure will allow us to have an oversight on the transfer of public resources. it will give us the possibility to have an oversight on the effectiveness of the execution and will allow us to verify the effectiveness of the measures on the execution and will remove the chokcees on teh system works for banks. financing is even more important in this long term difficulty. in addition, to the agreement

between banks and business associations to guarantee liquidity, the government and these associations determined the time and modalities to offer sustainment to businesses. industrial relations are a fundamental instrument to attract investment when they hearantee productivity for thewe full use of equipment. the government has offered the unions to see a draft of the reform of workers. we need to verify the level of consensus that this has. the development of a territorial or business marketing is sustained by the

extension of taxation, the profit increases that it generates also. the government also for next year an adequate resources for social safety nets to link with the activities of the redeployment of workers. the new public sector will require [no audio] -- the public administration guaranteeing salaries connected to individual and collective productivity. i will also talk about the cost of politics which is the subject of many discussions. based on the economic maneuver, the government will act to contain all of the sotheby's of

public officers -- all of the salaries of public officers. based on the reorganization of provinces which is based on the decree of municipal federalism will contain a containment of pressure and higher efficiency of services. you all know that cabinet has approved the reform that will half the parliamentary members and limit the cost of activities. a reform which is really needed right now is parliamentary regulation. we will be able to jointly verify the purpose of

businesses and the agency of the government with the objectives to either cancel or merge them. my honorable -- before concluding, i would like to remind you that the economic crisis caught us at a time when we were adapting to new technologies and to globalization. the growth was affected which has been more slow. and because of structural issues that slow down our development. first, with the decree on development and then a three- year budget, the government, in line with what we have done since 2008, has attributed 27

concrete measures to sustain the country's economic growth. relative to the fiscal structure. five, regarding simplification and liberalization. to increase efficiency of the judicial system. to give incentives to the production system. human, to give value to th capital. i would like to highlight the fiscal the attraction that we are giving to organizations who do scientific research and pay a 5% tax which is the least in the year before business is managed by individuals under 35 years of age. [applause] of the government -- of the government -- the government is

strongly committed to a solution of business crises. in the last eight months, we saw disputes thanks to government action and the desire to react to the business community and thanks to the collaboration with unions. we have been able to guarantee a future for a lot of businesses and families, being at the side of those who work and produce is one of the best ways to confront the crisis. they will -- we will continue to work on this front. we are aware that the defense and innovation of our production it is a fundamental to the economy of our country. our economy is energetic and strong with the innovative capacity of businessmen in the responsibility of unions which

was reflected in the recent statement on the need to accelerate relaunching growth. i want to remind us that the country is solid financially and economically. in difficult moment, it knows how to stay together. the government and parliament will act, i hope, with a political consensus to fight every threat through our financial stability. today, we need to act altogether. a wise warning that i make my own. all have the duty to roll up their sleeves. our duty whatever our political

affiliation is to operate for the good of italy and to recreate the development of the economy, doing our part. political stability is the winning weapon against speculation. as i am concluding, no one is denying the prices [no audio] [applause] you are listening to an entrepreneur who has three businesses listed in the stock market. therefore, he is in the financial trenches aware everyday of what happens in the market. [applause] we each have to do our part.

believethink -- i don't -- i am not asking for the opposition to support our program, but i really hope they can contribute with their ideas put in places to have of the country needs. i am asking that the oppositions do what they have been called to do without losing sight of the common objective, because i know we have the same objective -- to bring italy out of this crisis. this crisis is not an italian, but it is a planetary. i in sure you that the government will not be deaf to your proposals and ideas. of the government will have to do its duty, -- the government

will have to do its duty and complete its assignments. v i italian people have called us in 2008, and we will complete it in 2013. we will have an awareness of doing all that we could for our country in such difficult times. in the 20 months still before the appointment, it will complete the path of reform that we have already submitted to the parliament which are all very important for the country's modernization. it will strengthen even more the relations with unions and will propose interventions to sustain the growth of italy. to the italians, we are saying that the government is ready to do its part.

we have determination. we are aware of our responsibilities. and we have the profound desire to give to italians a strong and more self aware country. it is a difficult challenge, but the italians and need to know that we are all together. we will meet this challenge altogether. thank you. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> tonight, live coverage of a standing conference. rich lowry talks to students about the republican party. cyberth-long at us.s.

security. of the series continues next week with two members of congress. the third week of august, we talk to interest groups bank banque the last week, technical experts. saturdays at 6:30 eastern. on monday, a week-long look at the jobs situation in the u.s. tuesday, technical education. wednesday, private public partnerships. thursday, federal job programs. friday, women in the workforce. that is every day next week. >> the house of representatives has been off eight weeks already this year. >> on her nightly tv show, she tries to take a slightly different tubes.

>> we are willing to figure out how to make tv news exciting and entertaining and informative again rather than the garbage that it has dwindled down to beat. >> she will talk about her network anchor show sunday night. >> 6, 7, 8, 9 -- >> 5, 4, 3, 2, 1, 0. these are the stakes, to make a world in which all of god's children can live, or to go in the dark. we must either love each other, or we must die. >> vote for president johnson. >> this weekend, we will look at

the history of political campaign ads with a professor. a former homicide professor on the day that jack ruby killed lee harvey oswald. "american history tv," on c- span3. >> we think good things come in twos. >> live coverage of the senate on c-span2. >> you can watch events live on c-span.org. >> c-span2 has nonfiction books every weekend on "book tv." >> listen to us on your iphone or your blackberry, follow us on twitter -- >> and join us on facebook.

>> created by cable and provided as a public-service. >> deputy assistant treasury secretary for retirement mark iwry. the obama administration is once again pushing congress to make enrollment automatic. he spoke yesterday at a conference. it is about an hour. >> i am honored to introduce mark iwry. i have had the pleasure of knowing mark for a very long time very his influence on public policy calls to mind the

quote by harry truman," it is amazing what you can accomplish if you do not care who gets the credit." that is marked. -- mark. in an understated way, he has been a major force behind improvements in pension and health care policy for decades. chief among his accomplishments is the auto escalation default rates which is the biggest positive developments since 401k's were developed. he is an architect of the faovrs credit and co-authored the obama proposal to expand coverage through auto ira's. i don't have time to list all his accomplishments but i want to stress that mark is sought out by decision makers of all political persuasions in the public and private sector for his expertise, his insight, and his skill at making things happen.

he is truly an on son here in the retirement policy community for his ability to develop and implement sensible policies for pressing problems. if you have not already guessed my feelings, mark is simply a terrific human being. we're lucky to have him here today. please join me in welcoming mark iwry. [applause] >> alisa, thank you for the gracious act of perjury on my behalf. [laughter] i am delighted to be here. this is a fantastic collection of brains and talent. i would like to thank mike astrew, dave rust, david weaver, and everyone who put this conference together.

the consortium is a wonderful effort. it has been productive. it has added great value to the thinking about policy in this area and the three retirement research centers do an extraordinary job. i have a strong sense that being with such a distinguished and thoughtful group, the best use of my time right now probably would be to close my remarks and go around the room and solicit ideas. i'd like to collect your best thoughts and suggestions but i have been asked to talk a bit first.

i will dutifully comply. the theme of the conference -- innovations in retirement security -- is highly appropriate and timely. within the private pension system and the retirement savings system which supplements the fundamental bedrock protection that the social security system provides to the american workforce. within the private pension system, our second tier of retirement security in this country, the market is in no wading in a variety of important ways. it has to do with breaking down

the traditional barriers between the traditional benefits that promises a particular dollar amount, typically per month, for life in the traditional format as opposed to the defined contribution plan which puts a particular amount of input into the plan, a $1 contribution that grows with investment and is designed to produce an output that is not necessarily determine that the outset. breaking the barriers between those classic formats is something innovative that the market has done and it's on. -- on its own. policy makers have not taken the initiative to do that. the creativity and the market

has done that and has gotten beyond the labels and focused on the realities, this does of the attributes of these programs and vehicles, what characteristics they should have in order to best help people get retirement security and provide for their retirement security. our private pension system right now is in a state that one might fairly characterized as glass half full/glass half empty. the half full part is obvious and salian. -- salient. 65 or more million american workers are covered by private pension and retirement programs. millions of middle income and lower income families have been receiving benefits for decades

now from defined benefit pensions and from the fine contribution 401k and other plans. the ira's have supplemented the settings opportunity on a tax- favored this is for folks who do not have an employer plan available to them. we have accumulated the largest pool of investment capital, perhaps in the world. the latest results from the last quarter of 2011 suggests there is $11 trillion in the combination of defined benefit/to find contribution to ira with something like $2.30 trillion in the defined benefit pensions. something like $4 trillion in

the 401k and defined contribution and $4.70 trillion in the ira's. as we know, the ira's have been taking roll overs from the other two types of plants of that much of the ira money is attributable to these employer- sponsored plans that have had the benefits rolled over to the individual retirement account while other portions of the irs sets are attributable to continuing contributions by millions of americans, in particular, people who don't have access to an employer plan. the employer-sponsored system covers about half the work

force, perhaps a little more. those are key features of the glass being half full. the glass is half empty and the sense that the employer- sponsored system covers about half the workforce. perhaps a little bit more but the rest are disproportionately minorities, lower income people, women who are not in the work force steadily for 40 years on end, the folks who are left out, who are in some cases contributed and to these individual retirement accounts but only something like one out of 10 of the people who have no employer plan and are eligible to contribute on a tax-favored basis to an ira would actually

be contributing in an average year. the rate at which people use these tax-favored savings opportunities is not where it could be. the system is also driven by tax designed to encourage the private sector to supplement social security as it has done such a formidable way. but those tax preferences are designed in a way that may not be ideal when it comes to how best to address the needs of the majority of american workers. the system of tax preference is deduction-based. by that i mean, as most of you know, when you contribute a

dollar to a 401-k account, for example, or a similar kind of pension, or when an employer contributes a dollar on your behalf to a retirement program, it does not appear on the w2. it doesn't get included in your taxable income until years later, typically, when the dollar has grown and exits your plan as a withdrawal when you're ready to take it as benefits. typically, when it goes into the plan, it disappears from your tax base. it doesn't appear on your w2 which is of value to you in proportion to how high your tax bracket is. if you're in the federal plus state 40% or so tax bracket, saving $1 generates 40 cents of tax savings because that dollar would have been taxed to the tune of 40 cents.

so, to you, the after-tax cost, the cost to you of putting the dollar in the plan after taking into account your tax savings is the dollar minus the 40 cents you saved, or 60 cents. if, however, your tax bracket is 10%, you're getting a dime worth of tax benefits for the dollar worth of saving that you or your employer did on your behalf. so, the net after-tax cost to you in the 10% bracket of saving a dollar is 90 cents rather than 60 cents. you got a dime's worth of tax benefit for saving a dollar. many in the economics profession have referred to this as an upside down kind of incentive in the sense that the people who need the help the most to encourage them to save are given the least incentive.

and as a result, the congress in 2001 passed a saver's credit, a tax credit designed to level the playing field on behalf of a majority of the american work force. majority of our work force are in the lower tax brackets. many are working hard, paying their payroll taxes and not owing any income tax, rather, paying their payroll taxes which are a substantial amount, substantial percentage of their income. for these people, the income tax saving when they contribute is zero. they may have a fica tax break when the employer contributes.

this situation can be remedied by expanding this tax credit which congress enacted, the saver's credit, that gives people an additional financial incentive for saving when their tax bracket is not the highest. if you save a dollar in a retirement program, you could get 50 cents back as a tax benefit. the current saver's credit unfortunately, because of revenue constraints, gives most people who qualify for it 10 cents on the dollar back or some 20 cents on the dollar. very few get 50 cents on the dollar but it could be expanded in order to give more people a more substantial financial reward for savings that would level the playing field in favor

of those who are in the lowest tax brackets. it could also be made refundable, meaning that folks who pay their payroll taxes but don't owe income tax would get a deposit, a refund in the form of dollars contributed to their plan, 401-k, the i.r.a., whatever plan they contributed to voluntarily as an incentive to contribute. another shortcoming of the current system is that even of the people who do have an opportunity to save in the workplace, through an employer plan, many don't. one of the key innovations in the private sector that has addressed that shortcoming to a considerable and increasing extent and this is something

that alicia munnell has written on brilliantly, is the automatic 401-k. the notion here has been that one reason people don't participate as much in retirement savings opportunities that they have is that it takes initiative. it takes getting up off the couch, deciding where to contribute if you have an employer plan, it's clear where you contribute. but it may not be clear to you to contribute, how much to contribute, how to invest it, and the choices can, as behavioral economics have demonstrated, be daunting. they can keep people in a state of inertia where they don't get around to making the decisions and closing the deal and actually saving. we've had traditionally in the

401-k space something like a 70%, 75% take-up rate. somewhere between 2/3 and 3/4 of the folks who are eligible to save take advantage of it and all the rest don't. the rest, in fact, typically leave money on the table, as the expression goes, because the employer often matches what the employee contributes, perhaps at a rate of 50 cents to the dollar and so there's that employer matching contribution that the non-participant is leaving on table that they could get by putting in some of their own money. the employer plan is a powerful vehicle. it makes saving pretty easy. but traditionally not easy enough. the need to take the initiative to sign up for the 401-k, to make the decisions, how much to put in, how to invest, has deterred a lot of people. you may take the form home after

you're hired and tell h.r. you'll get it back to them after this weekend when you're going to sit down with your spouse or partner or whoever and think about it and make the decisions and then you'll bring it back week. if you're like me, by the time the weekend is over, you can't find the form. you haven't had a chance to discuss this with your spouse or whoever else, wraps an adviser, and pretty soon time starts to go by and inertia takes its toll. back in the 1990's, one of my staff came to me when i was at treasury back then and said there's an obscure legal question that we've been asked to consider. suppose a 401-k plan puts someone in the plan, enrolled them, and didn't make them sign up, but let them sign out, if you will, opt out of the plan,

would that be legal under the 401-k rules? should we spend time taking that question on? my job involved hundreds of legal and policy issues and my staff and i were swamped with things to do and i remember saying that we've got all these major policy concerns trying to encourage saving, trying to promote a more secure system, promote retirement security in various ways and we've got so many obtruse legal issues on our plate already, i don't think we have time to deal with this, let's put it off. the light bulb did not go off until a little later. i'll confess, it was probably a couple of months, and then all of a sudden it became clear that putting somebody in a 401-k plan but giving them the choice to

step out of it might actually overcome the inertia that keeps a third or a quarter of the eligible folks out of the plan. it was framed as a negative election. that was how the question arose, could we, instead of having people elect to participate in the plan and submit an election form, could we have an election form where the election is only if they want out of the plan. so we then realized that actually when it came tone couraging saving, when it came to good policy, to promoting retirement security, this was a very good idea that we ought to focus on immediately and if it wasn't legal, make it legal and promote it. we proceeded to do that. the few plans that had been thinking about this or trying this were given reassurance that consistent with all

the rules, 401-k rules, et cetera, and in 1998, we issued a ruling defining this practice and naming it, approving it, promoting it. negative election didn't seem like a great name. this is washington, after all. and we wanted people to understand that this is a positive, constructive idea, consistent with individual choice, but helping people find it easier to save, facilitating savings so that inertia, perhaps the most powerful force in human affairs, would be on the side of saving rather than on the side of not saving. no we called it -- and i must say when i say "we called it," i'll confess also that my staff and i gathered over lunch one

day and spent a half an hour discussing the name, what should we call it. automatic enrollment, just because that is descriptive of what it is. in the sense that as an employee, you're in the plan automatically even if you do nothing but it's not automatic in the sense that you have to stay in. that's just the default, the presumptive thing that happens, you can opt out. we called it that because we wanted to also plant the seed that maybe all phases of saving be automated in that sense, made easier. if you have enrollment made automatic so people are in unless they opt out, what about investment? why not make investment that way, too, give people the choice, let them decide what they want, but make an automatic option available so that if people can't decide or want to procrastinate, decide later

after they get more financially literate, then they can do that. so automate all phases, enrollment, contributions, investment and what about payouts from the plan. lots of the funds that are accumulated in our private pension system leak out of the system in the form of that may not be for an emergency, may not be to feed the family while someone's unemployed, may not be for a long-term investment in security, like maybe purchase of a home or education for oneself or one's kids. it may be to buy the bass boat or take a vacation or what have you. i don't think -- i'm not one that thinks the government ought to tell people what they ought

to do or whether they ought to buy the bass boat or use savings for retirement or college tuition but we are providing tax preferences for these savings. the taxpayers are paying more in order to direct tax preferences to this particular public policy purpose, so we have some stake in encouraging people in a certain direction, the purpose for the tax preference being, of course, supplementing social providing more retirement benefits and retirement security. so automatic rollover, that is, transferring the money when it comes out of the plan if you're not ready to retire, if you're in your 20's, 30's, 50's, whatever, and you're not ready to retire, transferring it to your new employer's plan, or transferring it to your individual retirement account to continue to grow and accumulate

on a tax favored basis. that so-called portability, tax-free rollover from an employer plan to a new employer plan or to an i.r.a. is something that we also could perhaps make more automatic, and indeed the system has moved in that direction. if the employee who leaves a job doesn't ask for their money, the money stays in the plan. if the employee has less than 5,000 in dollars in the plan, it used to be the employer could cash the person out involuntarily, write them a check, it appears in your mailbox and it tends to be spent. once people get their hands on the money, especially the smaller the amount, it's harder to visualize this is really going to make a difference to your ultimate security in old age, it's more likely to be spent. certainly that's true in my family. so what we did, congress and the

executive branch, was develop a way to automate these payouts to some degree. we provided that no longer would employers involuntarily cash out small distributions, $5,000 or less if that was the account balance in the plan, that they would instead keep the money in the plan unless the individual asked for it. if the person wants it, affirmatively says, giveit to me, great. they've got it. but if the person is silent, as people often are, they're distracted, they've changed their address, what have you, the money either stays in the plan to continue to accumulate on a tax favored basis, or gets rolled over to an i.r.a. in that person's name even if they didn't sign up for it. automatic rollover to an i.r.a. either way, it stays in the tax favored retirement system.

so the phases of saving in the 401-k world have been automated increasingly. plans have gone to automatic enrollment to an appreciable extent. large plans, roughly half have now converted from the traditional way of telling people if you want to be in, you have to sign up, to telling people, you're in at a particular contribution rate it. might be 3%, it might be 6% of pay. it certainly doesn't have to be a particularly low rate. it's whatever the plan sponsor decides, and by the way, in the obama administration, we've been at pains to emphasize that the rate does not have to be the 3% that a lot of plans use, which was the rate we used in our 1998 ruling approving automatic enrollment merely as an example and as a very initial toe in the water for this whole concept of automatic enrollment. so plans are increasingly auto

enrolling people. not so much the small, but the larger plans, and employees area participating no longer in these auto enrollment plans at a 2/3 rate or 75% rate but much more typically, 90%, 95% of the eligible employees. the take-up rate has been dramatically increased and who has benefited most from it? lower income people, minorities, folks who were not signing up for the plan at their own initiative often enough and are now doing so. those who don't want to save are free to opt out and consistently a significant number of people, whether it's 5% or 10% of those who are eligible, assert that choice.

these automatic 401-k's represent a kind of first generation of making savings easier. there's a second generation that's coming on that a lot of creativity in the market is spurring and fostering. by that, i mean, taking that contribution that might be 3% of pay for people who are newly hired and hiking it to 5% to 6% of pay unless they choose otherwise. they can choose to go down to zero or 1% or up to 15%, whatever the maximum is that's permitted in their plan, but when you use 5% or 6% as a default, the anecdotal evidence suggests that you don't get a lot more people opting out, maybe a few, but not a lot more. second, the contribution can ratchet up over time automatically.

the employer can say, we started everyone at 5% but in their second year at the firm, they're going off at 6% and the third year, 7%. you can get off the escalator any time you want but it's a default, if you do nothing, your saving level will go up in pursuit of greater adequacy of retirement savings. that step-up technique has been spreading steadily in the 401-k universe. the investments likewise have been automated so there's a default investment and the labor department has issued guidance some years ago, qdia's, qualified default investment alternatives, that has been used to a great extent in the private sector. and this success story in the 401-k world is one that has helped, i think, millions of people get into savings who were

not saving before, but what about the other portion of the population that doesn't have access to a 401-k? you can't enroll someone automatically in something they don't have. the idea has taken hold and my colleague, david john, senior fellow at the heritage foundation with bill gail, senior fellow at the brookings institution and formerly peter orzack, when he was at brookings, we, as part of the retirement security project, a non-profit venture some years ago, worked on these approaches and david john and i put forward a way to automate enrollment for people who don't have an employer plan. we have a voluntary pension system.

employers are not required to sponsor plans, as we all know, and many employers feel they're not ready to. they, however, have an asset that their employees could use to make saving easier which is their payroll system. one of the great strength of our private pension system is that it is employer-based, using that payroll system to make saving easier. rather than having to amass a certain amount of liquidity, a few thousand dollars worth of cash in order to contribute to an i.r.a., for example, although you can contribute smaller amounts subject to the i.r.a. trustee's rules, but rather than having to think about where am i going to get a lot of money in order to make a meaningful contribution, the employee, with payroll deduction, can of about from the slow, graduate allocation of a few percentage points of their pay every pay

pardon into tax favored saving. drip, drip, drip, over time. it's pretty painless but it adds up. and that payroll based saving mechanism which is are the hearf the 401-k and how it works, can be replicated for the millions of folks who don't have access to a 401-k or defined benefit pension or anything else by way of saving plan. we can extend automatic enrollment to them by asking their employers to let the individual salary reduce, that is, elect to have part of their salary go into the individual's own tax favored saving account, an individual retirement account, without the employer having to sponsor a plan, without the employer having to contribute from its own funds, matching or otherwise, or having to comply with the erisa labor

lay rules or the tax code plan qualification rules that apply to 401-k's or other plans. as a matter of policy, the administration and i think most people here want employers to want to sponsor the plans. we encourage employers to sponsor defined benefit pensions, defined contribution plans, whatever form of plan they're willing to adopt for their employees. but those who are not ready to do that could at least let their employees use the payroll system as a conduit, as the delivery mechanism to get the money from the employee's own paycheck, if the employee wants to, if the employee wants to, to a tax favored account like an i.r.a. in which the employee could save. that we call the automatic i.r.a. it's like automatic enrollment in a 401-k. and we proposed -- heritage

foundation has been very supportive of this, many other organizations, aarp has been tremendously supportive, members of congress on both sides of the aisle. the concept which the retirement security project launched some years ago was then adopted by the candidates, then senator and senator mccain, both of them indicated support for it and senator obama put it in his platform, his retirement program, as a central component and as president has continued to propose this in his budget proposals. a tax credit would go to the employers that do this that, let their employees use their payroll system and no employer that has a plan would be asked

to do this. it would be employers that don't sponsor a plan and that have more than 10 employees and have been around for at least a couple of years. the idea is, it should be as easy as possible for the employer, minimum of hassle or burden for the employer and no outlay. is notloyer contributing. there's no out-of-pocket cost. it has another item on its to-do list together with things like income tax withholding or fica or withholding it has to do for its employees already at the federal or state level. our hope is that something along these lines, the automatic i.r.a. proposal, which members of congress, congress neil, and others in the house, senator kerry and others have proposed

and which has attracted support from a variety of the quarters over time. hour -- our hope is that this will help address the people that are not in the system now and make it easy for them to save. there are many other potential innovations and constructive ideas that would be desirable to pursue and that i'd love to discuss with all of you. but we undertook to save some time for q&a exchange so, if you'd like to begin that. >> i would love to. if you have questions, write it down on a piece of paper. there are people all over who collect them. andy gave me some. one is, i think your baby was attacked by the "wall street journal."

there was a rehabilitate article recent article that the p.p.a. may have unattended effects on 401-k savings. >> for those who aren't familiar with the acronym, or the initials, pension protection act of 2006 was one of the things that after initial rulings from treasury and i.r.s. promoted automatic enrollment, alicia is referring to a opponent of view that very validly points out that if you automatically enroll people in a plan, some of them might go along with inertia even if instead of not participating otherwise they would have participating otherwise at a higher level than the default contribution. maybe i would have contributed 6% but the plan's default is 5%. that is a phenomenon that some

people called anchoring, anchoring people at a lower level and as bridgette would enthusiastically agree, you can address this readily by escalating the contribution level from year to year. you can, as dick thaler has suggested, every time someone gets a raise, you can increase their contribution automatically unless they want to do otherwise so they don't see their take-home pay going down. or as many companies do, even without regard to the timing of the raise, you can increase the contribution level automatically every year unless the employee opts otherwise. apart from that, it is so significant to have people who are not contributing at all

enter the plan for the first time and become savers by reason of automatic enrollment, that that tends to swamp the effect of people who might otherwise have contributed a little more, but who, by inertia, might be drawn down to the default level of contribution. take a zero contributor and bring them up to 5%, i would argue is more of a social benefit for all of us than to take a 10% contributor and have them contribute at 5% because they go along with inertia. you've created a new saver, you've encouraged someone to come into the system and if you increase the 5% gradually over time, you'll take care of the problem entirely. >> people write really fast here. there are a couple of that are related. one is that you've talked a lot about the accumulation phase of the 401-k plan.

should there be greater emphasis on people getting a lifetime income out of a 401-k plan. you made this point yourself, all the money is moving from 401-k's to i.r.a.'s so even if we did something for 401-k's, that's not where the money is these days. >> the contributions are being generated far more in employer-based plans like 401-k's than they are in i.r.a.'s, even though there are lots of contributions to i.r.a.'s, fortunately, as well. so focusing our policy on how to get people into 401-k's and how to contribute more, as you've said, very often is well worth it. the problem you're alluding to, alicia, i think is another one of the shortcomings of our system. that, over time, as we've shifted famously from defined of about plans to 401-k plans in

particular, employer-funded, employer-initiated, employer-directed, employer-investment-directed, to do-it-yourself plans that people direct on their own, that shift has been associated with a decline in lifetime income, a decline in retirement income payments as opposed to single cash payments. are taking money out of their plans in a cash payment and investing it on their own than might traditionally have been the case when plans were more prevalent that paid out lifetime income and annuity. a monthly check that you got for your entire life and the life of your surviving spouse, typically, that guaranteed that you would not run out of assets

during retirement, at least to the extent of that monthly check, in addition to social security. these traditional pension plans that paid annuities were, in a sense, similar to or mimicking some aspects of social security, paying a lifetime income. most of them don't have a kola, but in earlier times some of them did. that lifetime income has been declining. even defined benefit pensions are paying more -- people will elect against the default sometimes. our behavioral strategies need to be more sophisticated than simply relying on a default. and therefore, what the market has been doing by way of innovation and what the treasury

and labor departments have been doing has been focusing on how we can encourage more restoration of lifetime income to our system for people who want it, more substantial options, options that are easier for employers to choose to put in their plans, easier for individuals to take seriously as an alternative that they might want to use for their retirement security, and that lifetime income protection or retirement income, whether it's guaranteed for life or whether it's a long stream of payments for decades, that may or may not be technically an annuity, that's guaranteed for life, that is something that is coming back to our system slowly and we are labor -- labor and treasury -- encouraging a national conversation about this. we've gotten many comments at

our request and we're about to come out with administrative guidance designed to encourage people to consider options for income in various formats, whether commercial annuities, defined benefit plan annuities, individual retirement accounts, ways to help people manage their assets in retirement. accumulating the assets in the first place is critical and we're far from having reached our goals there, but happily, many middle income people are reaching retirement now with some more accumulation of assets in addition to whatever guaranteed income they have from social security and from any defined benefit pension and those people need help simply in deciding how do i make this money last and how do i assure that i won't run out in old age.

and that's the issue that is being addressed and we very much invite all of you to counsel with us on how best to promote that. we used to have something we called a private pension system. we still call it a private pension system, but the term "pension" traditionally has connoted lifetime income, a stream of payments that's guaranteed for life, the way social security is, the way many defined benefit plans still provide income, and returning to that as a viable option, not necessarily as something everyone should do, not necessarily something that people should do with all of their retirement savings. you need flexible assets, many people feel, for emergencies, medical shocks, but to at least put this option more solidly

back on the table. >> so you're going to have a truck or wheelbarrow when you leave here because there are so many questions. one person asked, do you have any thoughts about limiting the number of investment options in a 401-k? your whole deal is to make these easy and automatic. a lot of investment options are confusing. is there any thought about limiting the number? >> you're right, alicia, that in a sense our whole deal has been to make saving easier and much of it to make it more automatic. but part of that whole deal has also been to recognize the voluntary nature of our private pension system and recognize that the market and the private sector is in the driver's seat and that that's appropriate. what we're trying to do is encourage, make it easier rather than require. 401-k plans i think are finding that they can make the choices

easier. in some cases, not by reducing the number of options, alicia, but as you know and as you've written on this, by having one be the default. if you've got one automatic investment option, then it's easy for people who would otherwise be paralyzed by the range of choices, to go along with that and think over time about whether to diversify into other choices. >> so this one, i have no idea the answer is. could an investment company such as vanguard or a single state implement an auto i.r.a. if congress doesn't enact such legislation? >> that's a creative thought. >> these are creative people. >> that's why we're here. there is, i think, room for all sorts of innovation along those lines. employers now can voluntarily

adopt a payroll deduction i.r.a. that is, if they're not ready to have a plan and we'd hope, by the way, that automatic i.r.a.'s, if enacted, would encourage more employers to adopt 401-k's, to adopt plans, when they see how effective payroll based saving is and how their employees appreciate it. but employers that don't have a plan can have a payroll deposit, just the way they send direct deposits of paychecks to people's financial accounts instead of writing a paper paycheck out and handing it to folks on friday afternoons. that direct deposit of paychecks is a model for taking perhaps 5% of that paycheck at the employee's behest and sending it to wherever the employee wants to send it, like an i.r.a. >> but is not defaulted in? >> you could do automatically enroll employees and the automatic ira would

automatically enroll employees in these i.r.a.'s and let employees opt out. you could do something like that in another context but employers right now haven't taken up the payroll deposit i.r.a. either they've adopted a 401-k or so-called simple i.r.a. plan for small businesses, or typically, they haven't had a plan -- obviously, employers have adopted more elaborate plans like defined benefit, but the small businesses typically are not doing this voluntarily, the payroll deposit i.r.a. and that's why the automatic i.r.a. proposal would call for employers who are large enough to at least make their payroll system available to their employees with a tax credit for the employer that would defray whatever small administrative cost might be entailed. >> one last one and then we'll let you go because you're one

day from vacation. given the emphasis on automatic features, is there still a roll for financial education? >> that is something i'm very glad has been raised. financial education, i would argue, is crucial, and even more so with automatic features. the fact that financial education by itself is not sufficient to generate a breakthrough in saving in the united states does not mean that it isn't necessary or tremendously important. i think that it is. if you're going to automatically enroll people in saving at a certain level with a certain investment, you want them to their choice. the best thing is for the individual to decide exactly what they want. the auto features are just to help people get off the couch

and start saving, to help people get into the system. once they're in the system, if haven't already asserted their choice, they ought to have the opportunity to learn enough about these choices in order to make the choice that's best for them and i think that is -- it is critical that we promote the financial capability and financial literacy efforts. i know that you, anna maria lasardy, olivia mitchell have been leaders, the social security administration has been a leader in that, the treasury and the obama administration are strongly supportive of it and have also been trying to snrans and let me add, to connect these themes in closing, lifetime income, the idea that people need help, advice, other types of assistance in figuring out how to make their savings last and how to make sure they

neither run out during retirement nor hoard their savings in a way that means they're not living up to the standard of living they could have had because they're overly fearful, helping people with those issues is so education intensive a project. it's not only giving them easier mechanisms and methods like lifetime income arrangements but it's also helping them understand how it all works, how an account balance translates into a stream of income, and framing that issue so people will become used to thinking in terms of a retirement or pension paycheck that they need to provide for themselves rather than just a sum of money whose duration is uncertain. so this has been great. i very much hope that we can continue as we've been doing, the dialogue with all of you

here. we very much welcome -- i say "we," the administration, the treasury department included, welcome your continued ideas, input and collaboration on what needs to be a thoroughly bipartisan, nonideological effort, to promote retirement security for all americans. >> mark, thank you so much. [applause] >> john, you should come up and take over. captioned by the national captioning institute ---www.ncicap.org--- >> later tonight, rich lowrey will talk with students about

the republican party. and on sunday, on "newsmakers," chairman of the house foreign affairs africa subcommittee, chris smith, addressing how the united states is helping the famine in somalia and aid to african nations in a time of tightening budgets, that's sunday at 10:00 a.m. and 6:00 p.m. eastern. >> every weekend, american history t.v. highlights the 100th anniversary of the civil war. this week, the emancipation proclamation. albany law school professional, paul finkleman, on abraham lincoln and the proclamation. >> today, president obama visited the navy yard in washington, d.c. to announce an

initiative to help unemployed veterans to find jobs. the unemployment rate among veterans is 4% higher than the national average. the president spoke as the latest jobs report was released showing unemployment at 9.1%. >> ladies and gentlemen, please welcome the chair of the joint chiefs of staff, admiral mike mullen. [applause] >> mr. president, distinguished guests, good morning. on behalf of our men and women in uniform and their families, some of whom join us here today, thank you for being here. and welcome to the washington navy yard, our navy's oldest shore establishment. for those of you who don't know, this is a special place in american history. through war and through peace,

sailors, civilians, naval architects and business men came together at the navy yard to build and repair america's fleet. here, opportunity was created and innovation rewarded. here was spent the great sweat and muscle and sinew of our overseas security. not far from where we gather, u.s.s. constitution was brought in for repairs during the war of 1812. the navy yard manufactured the mammoth 16-inch guns that bristled atop the decks of our world war ii battle ships and here scientists and engineers fashioned the optical components that made possible the great accuracy of those guns. so it is fitting, indeed, that here today the president announces a new initiative to put the muscle and sinew and intellect of a new generation of

veterans to work again. many of these young people have served five and six and even seven tours in combat. some of them suffer from serious wounds, seen and unseen. all of them want the chance to pursue the same dreams every other american pursues. i think back to a young man i met in los angeles a couple of years ago. he fought in afghanistan, was fresh out of the army, and homeless. he told me, i gave my country 100%, all i ask for is 100% in return. that doesn't seem like too much to ask, a job, an education, a roof over your head, food on the table. what our troops need when they come home is more than yellow ribbons, parades, and an open heart. they need an open hand. one of the best ways to extend that hand to truly honor a

veteran is to hire one. with the right support, the right opportunities, our veterans and their families will not only make incredible to the workplace, but also to their communities, as well. they're smart, tech savvy, wired to serve and great leaders. they will make terrific employees and they darn sure know how to show up on time. the problem is that once they leave the service, they can be hard to find and tough to identify. i'm convinced there is a sea of goodwill out there of people and organizations eager to help but there's no easy way to connect our young vets with the employers and community leaders and community organizers who remain so critical to making and sustaining those relationships so i'm pleased and extremely grateful that president obama

has focused all of us on doing just that, finding ways to make sure our veterans have the tools they need for success after service and the jobs they need to continue their lives after they have done and given so much for us. he and the first lady have devoted an extraordinary amount of time and personal leadership to this endeavor. through programs like this one and their wider joining forces initiative, our first family is doing everything they can to put our military family first. they're doing everything they to give back that 100%. the president has made our troops and their families his top priority. and he's backed that up day in and day out with real and changes, and the resources to make those changes work. i've seen him labor hard over these initiatives and worry about them and drive us all to

better measures of success. he is nothing if not passionate and yet somehow he doesn't look a day over 50. ladies and gentlemen, it is my honor to introduce our commander and chief, president barack obama. you can go ahead and cheer, too. [cheers and applause]

>> i'm just waiting, here.

thank you very much, everybody, good morning. i'm glad somebody told me that was the lost one because i had lost count. it is great to be here at the navy yard and first of all, i want to thank admiral mullen for being here and for his four decades of extraordinary service to this country. and i want to thank him for

saying that -- for an old guy i look o.k. i appreciate this. this may be one of the oldest in the united states. but today, it's used to develop some of the most advanced technology in the military. although i hear your engineers are still working on a solution to the traffic when the nationals are playing. that's not ready yet. let me start by saying a few words about our economy. there is no doubt this has been a tumultuous year. we've weathered the arab spring's effect on oil and gas prices, the japanese earthquake and tsunami's effect on supply chains, the extraordinary economic uncertainty in europe, and recently, markets around the globe have taken a bumpy ride.

our focus is rebuilding a sense of security for the middle class that has been slipping away for years and helping them recover fully as families from the worst recession any of us have ever seen. today, we know our economy created 154,000 new private sector jobs in july. that's the strongest pace since april. the unemployment rate went down, not up, but while this marks the 17th month in a row of job growth in the private sector, nearly 2.5 million jobs in the private sector in all, we have to create more jobs than that

each month to make up for the more than eight million jobs that the recession claimed. we need to create a self-sustaining cycle where people are spending and companies are hiring and our economy is growing and we've known that will take some time. what i want the american people and our partners to know around the world is this. if we want our businesses to have confidence, they need to cash off the sidelines and invest and hire and we have to do better than that. we have to work together to grow the economy right now and strengthen our long-term finances. that's what the american people expect of us, leaders that can

put aside our differences to meet our challenges. so when congress gets back in september, i want to move quickly on things that will help the economy create jobs right now. extending the payroll tax credit to put $1,000 in the pocket of the average worker, extending the unemployment benefits to-people get back on their feet, putting construction workers to work to help rebuild america. there's no contradiction in us taking steps to put people to work right now and getting our long-term fiscal house in order. the more we grow, the easier it will be to reduce our deficits. both parties share power. both parties share responsibility for our progress. moving our economy and our country forward is not a democrat or a republican

asponsibility, it's not public or a private responsibility, it is the responsibility of all americans. it's in our nature to do the tough things when necessary, to do the right things when called. that's the spirit that washington needs right now. it's also the kind of spirit found in the men and women who proudly serve in our country's uniform. it's the spirit that endures long after they take those uniforms off. today's veterans are americans who have done their duty. they have fought our wars with valor in the jungles of vietnam to the deserts of iraq to the mountains of afghanistan and they include the members of today's military, the 9/11 generation, some of whom are here today, who volunteered to serve at a time of war knowing they would be sent into harm's way. to these men and women, i want to say that all of you have

served our country with honor. in the last decade, you have performed heroically and done everything we've asked of you in some of the most dangerous places on the planet. your generation has earned a special place in american history. today, more than three million extraordinary service members like you have completed their service and made the transition back to civilian life. they've taken their leadership experience, their mastery of cutting edge technology, their ability to adapt to changing circumstances and they've become leaders here at home. just think about how many veterans have led their comrades on life-and-death missions by the time they were 25 years old. that's the kind of responsibility and experience that any business in america should want to take advantage of. these veterans are already making an impact, making

companies and communities stronger but for every success story there are also stories of veterans who come home and struggle to find a job worthy of their experience and worthy of their talent. veterans like nick colgan. when nick was in afghanistan, he served as a combat metic -- medic with the 82nd airborne. he saved the life of a french soldier shot in the head and helped 42 people escape from a flooding river. he earned a bronze star for his actions. but when nick returned home to wyoming, he couldn't get a job as a first responder, so he ended up having to take classes through the post-9/11 g.i. bill, classes he could have easily taught, just so he could qualify for the same duties at home that he was doing every single day in afghanistan. there are veterans like maria

k.. when she got home she finished earning her degree in business management but even with her education and her experience in the army, maria still couldn't find a steady working job in accounting or finance. that isn't right and it doesn't make any sense, not for our veterans, not for the strength of our country. if you can save a life in afghanistan, you can save a life in an ambulance in wyoming. you can oversee millions of dollars in assets in iraq, you can help a business balance its books here at home. our incredible service men and women need to know that america values them not simply for what they can do in uniform but what i that -- they can do when they

come home. we need them to keep making america strong. our companies need skilled workers like our veterans to grow. there's no reason why we can't connect the two. keeping our commitments to our veterans has been one of my top commitments, including helping them make the transition back to civilian life. that's why we're fully funding the post-9/11 g.i. bill, helping more than 500,000 veterans and family members pursue a college education. that's why we supported extending the bill to include non-college degrees and on-the-job and apprenticeship training, that's why i directed the federal government to be a model employer and hire more veterans, including more than 100,000 in the past year and a half alone. so today we're taking it a step further. first, we need to do more to

make the transition from military to civilian life easier for our veterans. that's why i'm directing the departments of defense and veterans affairs to design what we're calling a reverse boot camp. the problem is that right now we spend months preparing our men and women for life in the military but we spend much less time preparing them for life after they get out. so we'll devote more time on the back end to help our veterans about everything from benefits to how they can translate their military training into an industry accepted an industry- accepted credential. in addition we will make it easier for veterans to go to their career center and get help for pursuing a career that will suit them best. these steps will help bridge part of the gatt between veterans looking for work and companies looking to hire. that is only part of the

question. the other half is about encouraging companies to do their part. that is why i am proposing a tax credit for companies to hire unemployed the utterance. i propose an increase in the existing tax credit for companies who hire unemployed veterans with disabilities. finally we are challenging the private sector to hire and train 100,000 veterans or their spouses by the end of 2013. this bill is part of the joining forces campaigned championed by my wife and joe biden. emens recently met their goal. today groups from the united

states chamber of commerce, accenture, have done their part to get veterans back in the work force. the bottom line is this -- we have a long way to go and a lot of work to do to get folks the economic security and opportunity they deserve. begins with connecting americans looking for, including our veterans with employers looking to hire. of the last few years another generation of young veterans has learned the challenges cannot and in can the hearth or baghdad. the continued here at home. today we say to our veterans, you fought for us, and now we are fighting for you. for the jobs and opportunities that you need to keep your family strong and keep america competitive in the 21st century. at a time when there is so much work to be done in this country,

we need everyone's help to do it. thank you, god bless you, god bless all our services, and god bless the and i did states of america. -- god bless the united states of america. ♪

♪ >> tonight we will bring live coverage as the young america's foundation continues its conference. the republican party. that begins at endicott 15 eastern on c-span. "the communicators" begins saturday evening with the white house cyber coordinator and the series continues next week with two members of congress. the last week of august, technical experts. this series starts saturday at 6:30 eastern.

two public trustees for social security and medicare talk about the solvency of the entitlement programs. according to a report on the financial health of the services, the programs' financial future is not sustainable. this discussion runs about an hour. >> today we are extremely fortunate to have the current public trustees of the social security and medicare systems.

for almost three years, these important spot remains vacant, and fortunately, bop and schock have been selected. bob has a long career in public policy. he was the director of the congressional budget office, and is now president of the urban institute. chuck star did in a strange direction. he was on the hill and was on the economic council, and now is a research fellow at the hoover institution. they were chosen for their high- level experience, they're accused in sight and their talents, not the least of which is a rare ability to command wide respect across policy spectrum. chuck will talk about social

security. bob has a harder job of talking about medicare. they will take questions at the end of their remarks, so let's welcome them here today. [applause] >> thank you for the very kind introduction, and i thank you for inviting me to participate here. i have been looking through some of the papers in the book lists, i wished i had shown up for more of the proceedings. as always, fascinating presentations. i spoke to this conference a couple of years ago, and back then i was a social security, retirement security adviser to president george bush, and when the second term ended, you thought you were rid of me, but alas, president obama and the senate have ruined that hope.

i am now back as a public trustee for social security and medicare, kind of like a song you are really sick of get remade by somebody else. sorry about that. it is great to be here because we have the timely and important things to talk about in this setting. for the last several weeks, if not months, washington has been of your with the debt ceiling crisis, and now that that temporarily is past us, we are able to turn to other very pressing economic policy concerns. first and foremost among these are reviews of the public trustees on the actuarial sign, but a lot of them material that is covered in this event is going to be important to policy- makers in the months ahead. most of you know about the

trustees process, and you know about what we'd do, but for those of you who are not familiar with it, let me say a little bit about who the trustees are and the functions we perform. there are six trustees. four of them are government trustees, secretary of treasury, labor, hhs, and the social security commissioner. there are two public trustees, one democrat and one republican, and these positions were formed in the 1983 social security amendments, and the idea was there would be two external pairs of eyes looking at the projections on a bipartisan basis and substantiating public confidence that they were put together in a most of jessica -- most objective possible way. i have been a longtime fan of

this process, the center of this process, and even before i was a trustee, i would be in the debate over the significance and accuracy of their projections. that is an appropriate thing to occur each year. the projections should be debated and approved for one year to the next, but i have always been in the position of saying i thought process was serving the public well, and i thought projections were released in a qualitative sense reasonable. now i have a high honor of serving as a trusty, that long time confidence and support i have had for the process, i found it only further substantiated by my experience over the last year. i have had the opportunity to participate from inhofe in the inside, and the clear commitment, object of the, freedom from agendas, ideological or otherwise, and it

has been a gratifying thing to be a part of. i will talk about social security. ball will talk about medicare. medicare is the difficult one. let me begin with what the trustees report projects. before i say how we as public trustees interact with these projections, and seems worthwhile to know what they are. this chart, if you were to pick a single graphic in the whole report that expresses the projections of the trustees in a nutshell, this is the one. you can see a tremendous amount of information on this graphic. you see a couple of lines here. everything is expressed as a percentage of the programs taxable wage base. you can see the ball line representing the expenditures, and you can see how they're projected to grow dramatically

over the next quarter century as the baby boomers leave the ranks of the work force and enter the ranks of the beneficiaries. in some respects the latest versions of this graph decides this democratic phenomenon. if you look at 2008, you see a son spike in costs. -- a sudden spike in costs. we also have a difficult spike in disability claims and some increases in early retirement benefit claims and other things you see as a consequence of that recession. if it were not for that spike around 2008, what you would see on this graph is a pretty steady an uninterrupted and sharp increase in program costs relative to that tax base, stressing from about 2008 to 2035, directly as a consequence

of demographic change. what this chart shows even though it is focused on annual system operations, you also get information about trust fund financing. if you look at 2036, you see the bolt line coming down, and that is the point of trust fund depletion, where you see this hippocrene the benefits and the resources it will have on hand. this graphic presents the information that combines trust fund depletion as projected for 2006. you can see clearly that this is a situation where democratic change is causing house to rise lot of income. this phenomenon crests in the 30's.

it is the increase in costs that treats the imbalance between income and outflow. the graph also shows the percentage of benefits that can be financed from revenue once the trust funds are depleted, and that percentage in 200036 and graduate declines in years afterwards. there are a few key summary measures in statistics that appear in the report each year. this year we project the combined social security trust fund will be exhausted in 2006, but the trust funds, there are more than one. there's the old age and survivors insurance trust fund. there is that disabilities trust fund. the disability insurance trust fund is projected to be depleted in 2018. the report also contains

projections for what i would call the nightmare scenario. what if we do not do anything until 2006? if we fail to act to correct program finances, we will face terrible choices. it is not possible to leave -- to believe that our system when annette austerity measures required in 2006. you have to reduce benefits across the board by 23%, and people already those in retirement, and you would have to hike the tax rate up to 16.4%. one of the things, you do not tend to see qualitative changes in the social security protections. the projections tend to be stable because most of the factors, unlike the medicare projections, that bear upon the

projections in a qualitative way are well-known relatively easy to estimate. if you go back and look at every trustees' report over the decades, you see 0 again the same general cost curve. you might see the imbalance move around a little bit, but the qualitative shape does not vary that much. this year we find that the 75- year actuarial and balance is 2.2% of taxable payroll. that is not a qualitative change. that is a .03% is a bigger deterioration of the scene in a report since 1994. it is not a qualitative change, but by standards, it is a pretty big one.

the reasons for the large single year deterioration this year are presented in the pie chart. the vast majority of -- about half of it arises from changes in longevity, updated mortality figures. we are living longer than previously projected. that is good news, but it is not great news for social security finances. the vast majority of the part of the pie chart that refers to demographic changes -- functions, a portion our updated projections also appear in the methods and other day that slice because as we extrapolate in the immediate future, we do it at the rate of change of recent years. there is a little bit of that longevity change in those slices of the pipe. roughly half of the worsening in this report is because of

longevity changes. there is also some worsening because of the sluggish economy and spillover defects reducing immigration, but longevity is the biggest piece of its. -- it. i would say first and foremost that our primary responsibility as trustees is to vet assumptions that go into the projections and sign off on them as being reasonable and objective. reasonable does not need right, but we can make a determination whether or not we think we are using the most reasonable assumptions. basically, what happens is the economic and demographic variables that bear on projections are basically developed by the office of the social security actuary.

those recommendations are before us, and we reviewed them, edit them if they require editing, or accept them here the same economic variables are used for medicare reports and social security reports. there are other durables the other developed by the medicare actuary's office, but these come out of their shop. they present us with recommendations for an intermediate assumptions for each variable, and also a low cost for a high-cost carrier of all that represents what would happen if that particular variable broke in the direction that either increase or decrease system cost. the first two items you see, fertility and longevity, they are very important to the long term sheet of social security finances. a couple of notes i would make.

net immigration, it has been my experience when people look at the trustees reports, the immigration numbers often strike them as looking small. i think that is because they are presented as net immigration figures. tial. is a difference s that accounts for part of the reason why they tend to appear smaller than many people expect. spurred activity is an assumption that is fly-specked a lot each year. future productivity will be roughly consistent with what has been the average over the last few business cycles. you do not fund the system with productivity. an important component of this is what is the share of productivity growth that is expressed as real wage growth.

this is important because compensation that is expressed as real wage growth is taxable by social skirting, where compensation that comes in forms that are not taxable like other benefits, do not result in additional revenue for social security. there is the wage differential that is relevant to social security finances. we are projecting a slight increase in real wage growth: ford, based on projections that the share of worker productivity growth going forward expressed as rising real wages will be slightly higher than in the past due to in the past having an extremely high rapid growth in benefits not subject to taxes such as health benefits. a very important additional matter that the trustees have to

speak to his not only what the assumption and the projections are, but we have to tell policy makers how much confidence they should have in these projections. a lot of different ways that the trustees' report speaks to projection uncertainty or certainty, and one of the tasks we have is how we should talk about it and how much emphasis the trustees' report should place on different forms of uncertainty. as i indicated previously, there is a sort of low cost and high- cost scenario built around illustrated assumptions. if you took every variable and as soon their broken in the direction that decreases system costs, then you get a low-cost scenario. if it breaks in a way that increases costs, that is a high scenario.

there is sometimes a tendency to colm to the report and say here's a projection in which the social security trust fund does not become insolvent. op ed writers will occasionally do that. i will say that is the wrong way to think about the trustees scenarios. they are illustrative. did not appear within a broad range of possibilities for program finances. this is an analysis that appears in the report, and it allows the difference rebels to fluctuate and shows the wide range of scenarios that can result from these fluctuations. i have shown one graph resulting from analysis here, and you can see with respect to the long term direction of the trust

funds, qualitatively you do not see that much change even under a pretty wide variations in the economic and demographic assumptions. under the medium scenario, that combined trust funds become butolvent in mid 2030's, d.c. that date fluctuate only in a few years. you will see several years of movement in the insolvency date, but you do not see a qualitative change in the direction or the health of social security. the scenarios are outside the bounds of even that 95% scenario intervals. there is not much basis when you look at the trustees analysis of uncertainty for adopting a wait- and-see attitude towards program finances. under all these plausible scenarios, we will be much better off if we correct the program finances today than if

we waited to a future date. the last thing i would say before turning it over his that the trustees always have an issue of deciding what to emphasize. what is important? the trustees reports last several hundred pages and very few people read them all the way through. i suffer from this melody when i was congressional staffer. there is a lot in there, and policy makers did not have time to wade all through them. we have to choose what to emphasize. that is an important role of the trustees. it is expressed in different ways. when we go to testify before congress and we have a five- minute statement to make, we have to choose what to put in that statement. when we talk to the press, when we talk like this, we have to talk about what to put in our statement. in the summary and in the

message specifically by the two public trustees, we have to make choices about what to put in those messages. i thought i would review a couple of the things that we as trustees or the trustees as a group chose to emphasize this year. one is that we would be much better off if legislative corrections are enacted soon. you're probably tired of hearing this. this has been said in almost every report stretching back for decades. it is important. it is important that policy makers understand it. there are adverse consequences, especially for potentially for all beneficiaries the longer we put off dealing with this problem. certainly in social security, but also to a larger extent with medicare, the vast majority of the cost growth of these

programs taken together occurs before 2035. on the social security side, it is almost always by 2035. before that, the primary factor in driving the increase is demographic change. this is not to say that inflation is not a significant problem. it grows more significant the further out in time one looks. we have an immediate problem affecting our ability to get federal finances under control and to get these programs finances under control, and it is coming out very rapidly and plays out in the next quarter- century. it is important to understand how wonderful opportunity is in many ways the find by the way in which demographic factors drive the program cost growth and are doing it not only the very long- term, but from now until the mid 2030's.

the certainty is different with respect to the two programs, and the degree is different with programs, the to pewo but the fact of the uncertainty is for sure. another item we chose to emphasize, and i will say having appeared with the doctor had a couple of hearings are ready, i am not sure how we're doing it at this point, but it is easy to get distracted by a lot of other debates people 1/2, and people want to debate the trust fund, is it real, is not real? people want to debate such as dirty and medicare's relationship to the larger federal budget. these are important things to discuss. you can get sucked into an angels on the head of the can

discussion that can distract you from the reality that regardless of we come out, we have to deal with social security and medicare. i compared this to the blind man feeling the different parts of the elephant. they can all be right, and they all want to emphasize different aspects of the trust fund, and you can choose to emphasize different sides of this the and on what would want to make. as soon as he stepped back from the arcane discussion, step back from discussion about how big a problem is social security rights respect to the larger federal deficit, the bottom line is you come around to the same conclusion. you have to deal with these programs. a you are better dealing with it sooner than later.

another point we make is important, difficult to quantify, but we make it in the report, we can show you technically how the costs of repair rises over time. in many ways, we are understating the actual cost delay because of practical political constraints, practical policy constraints. 36 yould show you in 200 would have to cut benefits across the board. going to want to do that. if you want to get a realistic assessment of how the cost delay plays out, you have to factor in things like we did not want to

cut benefits from people already in retirement, we do not want have a sudden reduction in benefits for low-income people, that sort of thing. you put those factors together and explain to policymakers how is the window of options become more narrow with time, the it is the window to solve these problems is closing much more rapidly than he would ever know from these various across the board illustration's we do. we make that point in words and the report and i tried it to stress it when i testify, but the bottom line is that when we talk about the costly and look at that lands, it is bigger than it first appears. with that, i will turn it over to my learned colleague to talk about the more complex of the two programs. thank you. [applause] >> thank you. it is a pleasure to be here. i have attended a number of

these conferences over the years, and have always been interested in what is being transmitted. i want to start by acknowledging the tremendous contribution of the return -- retirement research consortium and all the folks who have worked with them have made over the last 13 years to our understanding of retirement policy and our knowledge of the behavior of those approaching retirement and in retirement. i also want to congratulate the consortium on producing papers that by and large have been accessible to the non academic, and had been policy relevant. this has been over these 13 years a tremendous investment

that will pay even greater dividends in the future as we get around to reforming the nation's's retirement programs in ways that reflect the change in social and demographic and varmints, as well as physical realities we face. we were asked to say a few words about the responsibilities of the public trustees as well as the challenges that the trustees face in making long-run projections. with respect to the first of these topics, as you might have suspected, no training manual for a briefing in which to roles and responsibilities of the public trust these are laid out excess. when i was first called and asked what i have an interest in being nominated for this position kamakura i asked the individual who called as loss of his colleagues in the white house what the expectations were

and what responsibilities were, there was silence at the end of the phone. [laughter] been a researcher at heart, i went next to the statutes and the language and discovered that there were four tds and rated for the trustees -- four duties enumerated. the first of this is to hold the trust funds, the legislative language. do we go out to western kenya and open the file cabinet -- west virginia and open the file cabinet to is that a heavy lift or a light left? do we do this every year to judge the situation of the trust fund? i have been disappointed to find out that is not the case.

no trips. second is to report to congress each year on the past and future status of the funds, is what the reports do. third, report to the contras immediately if the amount in in the trust fund is too small, which i guess -- [laughter] maybe you have to go to parkersburg and check it out. finally to review policies followed in managing the trust funds and recommend changes. there is no separate distinct roles for the public trust fees from those of the ax of his to trustees. as you all know, public trust these positions are not particularly visible ones, so you cannot look at the behavior of incumbents and the -- and get an idea of what to expect from

an observational standpoint. it would not have helped us because as pointed out, there were no incumbents to observe, and neither can you call up those who will be your fellow trustees, they been cabinet secretaries who have more important things to do than answer questions like this. in any case, none of them nor any of the political appointees in the department who served as their representatives on the working group would have been able to say too much because, for all the time they served, there was no public trust the. one can consult with those who held positions in in the past, what those discussions revealed was that at different times, the

public trust these roles have been quite different and there was nothing to generalize about, except there was one common message that i heard from all of them, and that was to be most useful to this process and most effective, the public trustees should collaborate and develop common positions wherever possible, and chuck and i, with one glaring reception, have followed this advice, and the glaring exception is that every time we are in a room with more than two people, i have been come dr. richauer, and he re mains chuck. then used me for a little while, this wasi realllized his way of saying i am a lot younger than you are. here we are again.

i did not go through this investigation. i did not have to go through this to know what the primary responsibility of the public trustees was, and that is to ensure to the public both the integrity of the reports and the object of the and high quality of the analysis that underlies them. notwithstanding the independence of the actuaries and the social security administration, it is possible that political pressures could make incentives to massage the projections in optimistic projections. those of you who are older than hchuck remember that during the nixon administration some people in the white house had obsessions with certain data series and tried to tinker with them. it is not totally fanciful,

neither would it be surprising the any of you that while in theory this is a danger that exists today, and practice it is not something anyone should lose even a minute's worth of sleep over. the offices of the actuaries are probably independent and committed to preserving their reputations that have been burned over the years for developing sophisticated methods and producing objective analyses. the department will staffs that support the trustees are highly skilled professionals who take their mission of the object of the very seriously, as does the staff ssa. is also clear from having gone through one cycle and watching the give and take that occurs when the reports are to gather that there is no administration position. each department and agency has its own perspectives and its own reviews, and as far as i can tell, feels free to express

them, even when it is a minority view, even when steve goss is frowning or rick squirming in his chair, in their displeasure. it is an extremely open and funded process, and to be part of the back and forth of the emails, 2:00 a.m. when the final pieces are put together, is quite interesting. the technical panels are another bulwark here that we have, and they are convened periodically. there are two now in process, and they help to ensure the integrity and quality of these reports trickled as you all know, and some of you may be in

the room, these are the most knowledgeable among the most knowledgeable analysts and practitioners on social security and medicare, and what they do is review the assumptions and methods used in past reports and make recommendations about how they might be improved in the future. while this point in our history, the trustees responsibility for ensuring the objective of the and quality of the trustees' report is not a huge issue that requires constant vigilance, there are other roles that we play, and i will talk about them in respect to medicare. the most important of these in a fresh sets to be of eyes looking at the report and asking what changes should

and could be made that would improve their usefulness. only the public trust these are likely to raise such questions. as you undoubtedly noticed, the structure and content of the trustees reports change as little from year to year. if one is familiar with the previous report, one can open a new report and find the same analysis using a fresh set of assumptions and a new base-year that in the same place with the same charts, with the same supporting analysis. there are many reasons why maintaining such continuity makes a great deal of sense, but at the same time someone should be asking from time to time, whether the reports could be shortened, restructured, or simplified in ways that would better serve the needs of those to whom the reports are directed, maybe even there would be more people who read the retire reports having heard the confession as a staff person and

nod she wink and does not read them from cover to cover. even the summary document are not very user friendly, they are not the time reading unless you desire to fall as it quickly. to some extent, this is unavoidable, because social security and medicare are large and complex programs, and explaining how their funding mechanisms work and the financial such reasons are likely to change over the next 75 years is no easy task. the use of jargon and technical terms is probably unavoidable. over the years, the trustees and the actuaries have added more and more information, offering new and useful perspectives and more detailed explanations and

analysis. the bill has been dropped. as a result, the reports have become longer and there is a growing danger that the reports could become confusing and hard to follow for those who have not earned a black belt in entitlement analysis, and half of those are in this room right now. it is also worth noting that communication technology has changed dramatically in the last couple of decades, and i suspect most users now access the reports online. one has to ask whether the core of the report could be convinced with much of that the logical discussion and explanatory material related to web-based dependencies that would be accessible through links the may report. by law, the reports are directed to the congress, whose members have knowledgeable staff to help them convince, summerize, and i

just the reports' conclusions, but information in the report is also of great interest to the public and to various interest groups representing current and future retirees, providers, and other groups, and the dependent by and large on the media to translate the reports for them. this raises a second question worth reviewing, which is, to the reports do enough to ensure that the key findings will not be this characterize, exaggerated, or minimized? in general, the media wants to tell a dramatic story, a simple one, and the more crisis areas, where he lee, the better. he better. teh

the projections in the most recent medicare report provided a lot of food for crisis talks. first, it revealed that contrary to previous addresses, spending would exceed income for the indefinite future rather than returning to a surplus, which is what the previous report had shown th, after the economy begn to recover. we have a great headline -- "h.i. underwater and sinking." report also projected that the date at which the trust fund would be exhausted had advanced by some five years from 2029 to 2024, and finally for those who get into the more sophisticated

measures of the trust funds' health, the actuarial balance had to serrated by .13% between the 2010 and 2011 report. these bits of bad news and were widely reported. you focused on the reasons, leaving an impression among some that policy changes and a big- spending government may have contributed to the worsening outlook. in fact, as you can see from this chart, all of the deterioration in the 75-year actuarial balance and most of the bad news in the shorter term was attributable to the fact that the economy in base year 2010 proved to be weaker than was projected in the previous report, and recovery was now expected to be less robust. for example, h.i. taxable

earnings were considerably them lower in 2010 than in the previous report, and notwithstanding the real earnings in the last and most recent report were sent to grow faster over the 2011 to 2024 . ,-- period, the revenues are expected to be 1.3% less than in the previous record. nor did the press report the news in its proper context. for example, while the date of the trust fund exhaustion moved to 2024, between the two reports, it was rarely pointed out that this was seven years later than was projected in 2009, which was the last report that was issued before the

affordable care act was enacted. currently, the trustees reports due in my opinion an excellent job of providing detailed, balanced explanations of why metrics change from when you to vex, but the story is rarely as simple one. the changes in the assumptions are listed in the analysis is laid out, but often readers are left to develop their own summary explanation. in an era when many americans get their affirmation from sound bites from politicians or from screaming, ill-informed posts on cable television, one wonders whether greater efforts should not be made in the trustees reports highlight short, summary exhalations of the changes that take place from year to year and the metrics that receive the most attention by the press. let me conclude by saying a few words about a third question, which is how the inherent

uncertainty of projections can be incorporated into these reports can be conveyed without undermining confidence in projections for this year's list of the problems that we face in the future. there is an issue that medicare has two dimensions, one, all of healthcare, and the other is one procurer to medicare. aldrich as of health care are inherently uncertain the -- as new interventions, procedures, devices, online, and as the delivery systems change. as result, no one really knows with a great deal of confidence what health care will look like in 50 or 75 years or what it will cost. this problem is compounded by the -- with respect to medicare because it is a program in which

the payment schedules that are settled law, and a charge given to the trustees is to protect the costs of that program under current law. however, we can be sure that certain aspects of current law will not be adhered to. the obvious example here is the sgr, the systems will -- the sustainable growth rate mechanisms. for the last nine years along these accounts have been problems all, but congress and the president have waived the discipline of the sgr, and it is almost certain that that will happen again. this is a situation that is not unlike the dilemma that the congressional budget office faces that did projections for

many years on the basis of current law. but current law at the expiration at various points of the 2000 and 2003 tax cuts and non-indexing of parameters of the alternative minimum taxes and other changes that everybody knew would not be was happening. there is a search for an upturn of the baseline that is credible kamakura but-- there was a search for a base line that is credible. we faced a same situation, and what the trustees reports due his estimate current law. when you open the trustees' report, although there are

warnings every 15 pages, staring at you, these are numbers for part b assume there is a 29% cut that is going to be extracted. and if that were not the case, the part b spending in 2012 would be 12.6 percentage points higher, and by 2080, it would be 97% higher. we're not talking chump change here. these are very, very significant differences. if one provides two sets of projections in the reports, will that be confusing? if one provides a second set, assuming that the sgr is not

adhered to, there's the question of what should you use in its place? should you use the underlined law which suggests the medical economic index would be used to update the physician fee schedule, even though over the course of the last nine years that congress and the president have on average selected updates that were knocked as high as the nei? this is a huge challenge that we face, to present information that is useful, that it here said the requirements and allow all, and does not confuse the readers. let me stop there and just say that while i have raised issues with respect to the trustees

reports, when in no way do i have the answers to these questions. was part of the discussion waved these issues and continues to wave these issues. as chuck has said many times, i just do not know where to come out. there is no good solution. as a final picture for you, you know the chief actuary at the cms has raised concerns, not just about the sgi, but also about the ability of the nation to adhere to the constraints that are part of the affordable care act and has provided in supplementary material an

alternative projection that has replaced by the medical economic index and has the medical adjustments to the provider payments, as included to the affordable care act. the results of that is backed there is a substantial difference in medicare if we are not able to adhere to these fiscal discipline that the congress has enacted over the course of the past few years. on that happy note, i will step down.

>> thank you very much. [applause] we are almost out of time, but why don't we take a few questions for dr. reischaur and track. -- chuck. i just want you to know how valuable that document is that is put out with the trustee's report. >> i am a consulting actuary. i have a specific question for the doctor. why do you think the media suppress the name of mr. foster during the health-care debate? he was hardly heard from a lot

-- at all. >> i think chuck wants to answer that question. [laughter] >> we have another question. >> i am seeing medicare advantage be more and more popular with middle income people. some reports are that they're happy with it. and yet, it appears that these plans are trying to exert managed health-care on this population and are being subject to additional scrutiny. the funding support seems to be questionable from year to year. can you comment? >> that is the kind of question that we tapeke.

our public trustees often set aside that and will put that cash bond. it is still true -- put that cap on. it is still true that medicare advantage plans are being paid more than what it would cost the government if their members were participating in traditional fee-for-service medicare. i think a level playing field is the right way to go. unless you can show convincing evidence that the outcomes with medicare advantage plans are superior.

we would probably have debate on additional bonuses for which there are now for those that come out of lower performing fee-for-service services. >> in the last panel there was a question about social security and the point was made at the current generation of people approaching retirement or already retired have got away with not having their taxes raised as would have been appropriate in the 1990's. but of course, they're still around.

you stated that it is very difficult to make chang -- changes in funding for retirees. >> first, i agree with your analytical point, which is that the way things look now, we are not heading toward a future of equitable treatment with social security. if you look at a relationship between contributions and benefits for different generations, we have already postponed to the point where younger generations are going to be treated in much worse than the generations before them. that is one of the consequences of delight. as to the question of how long we can maintain this idea that

people who have previously retired should be held harmless, my views on this are evolving. if you would ask me six months ago, i would have given you, and did give the view that it is going to be a political ethic. and as time goes on, the balance of any ultimate changes to assure security are trying to fall more and more to the tax increase side because of this desire on both sides of the aisle, not just affecting people already in retirement. but if we continue to delay fiscal repairs, i am not sure that holds true forever. we may ultimately get to a place -- we are rapidly approaching a place where it is simply too heavy a left to repair within a financing structure. we have already passed the point where we have a 75-year shortfall that is bigger than we have seen before.

if we were to delay 10 years more, we would be at a point where the changes you have to make in the short term are already several times larger than anything you have done before with this program. if that happens, then you risk not having a stable financial system. you have subsidized to the point where it becomes a political barrier to changes in benefits, even though that already on the rolls it disappears. >> can i just add a footnote? >> yes. >> the exception to affecting people who had already retired, of course, was the subject in of benefits and come to taxation. -- the benefit income to taxation. the cracks and the six-month

delay in the cola -- >> and the six-month delay in the cola in 1916 -- 1982. thank you. [applause] will the people who are on the next panel come up? [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> later tonight, live coverage at the young america's foundation continues its national student conference. richard lowry talks with students about the republican party. that begins at 8:15 p.m. eastern shore on c-span. sunday on newsmakers, chairman of the house foreign affairs africa subcommittee, chris smith. the new jersey republican will address how the u.s. is addressing the famine in

somalia, tensions between sudan and south sudan, and a between african 8 nations any time of tight budgets. -- between african nations in a time of tight budgets. >> on her nightly tv show, former russia today, now the party network -- now the rt lessrk, takes a slightly traditional view. >> we are trying to figure out how to be entertaining and informative again, rather than the garbage that it has dwindled down to be. >> she will talk about her network and her show sunday night on c-span's q&a. >> next, a look at collective bargaining rights in sports. the nba locked its players out on july 1st after their labor

deal expired and filed a claim against the national swap players union for unfair labor practices. and last month, the nfl and a and a lockout. igh this is about 90 minutes. >> before we get started, i want everyone to know that initially, myself, mr. hunter, we are going to stand because they will be speaking to you initially. and then we will be up there in comfort on the chairs. on behalf of the national guard association, i want to welcome everyone -- welcome everyone to the executive directors form. we all look forward to sunday during the football season and we look forward to during the week and on the weekends.

the sports industry has naturally developed into a multibillion-dollar industry. two of the biggest sports of all professional sports are football and basketball. and the two attorneys who happen to hold those players together are two african-american attorneys, mr. william hunter, and mr. morris smith, of the nba and nfl respectively. today, we have mr. william hunter. he took the helm of the nba association in 1996 and was named the director of the national basketball players association. the union of current professional basketball players

in the national basketball association. his personal duty is to enhance the financial and emotional well-being of the nba players. mr. hunter continues to line his efforts with the nbapa's mission to ensure the rights of the and to are protectived assist in their abilities on and off the court. what a lot of people do not also understand is that mr. hunter is also the head of the w. nba players association for the

women. is an organization he created and they also serve the women nba players. mr. hunter arrived well-prepared for the high-visibility role of the renowned sports union. his background includes a stint as a professional football player with the nfl's washington redskins and miami dolphins. and he is a former u.s. attorney in the northern district of california in san francisco. mr. hunter graduated from syracuse university, where he was captain of the football team, and received his doctorate from howard university. he was also a local prosecutor in alameda county and with the san pritzker district attorney's office. he was appointed as u.s. attorney by jimmy carter in

1977. after serving as u.s. attorney, he developed a private practice representing white collar clients and has represented such individuals as and c. hammer, deion sanders, rickey henderson, and a host of athletes and entertainers. with that, when you join me in welcoming billy hunter? -- would you join me in welcoming billy hunter? [applause] >> i put mr. smith bio of a bigger strike would wear my glasses. mr. smith was elected a director of the national football league's player association on march 15th, 2009. he replaced the legendary gene upshaw, who passed away on august 20, 2008. his election -- prior to his

election, he was a trial lawyer and the litigating partner. the is a native of washington d.c.. mr. smith served from 1991 through 2000 as assistant u.s. attorney and ditch attorney at the u.s. attorney's office in the district of columbia. -- district attorney at the u.s. attorney's office in the district of columbia. mr. smith served as counsel to the deputy attorney general eric holder. he was also the u.s. attorney's office lead rep to the law- enforcement inaugural committee and served as the u.s. secret service's multi agency command center during 2001 presidential inauguration. during that time the focus primarily on white-collar offenses and tort trials, and also chaired the government investigations in the white- collar practice group.

mr. smith argued numerous cases before the u.s. court of appeals and the district of columbia circuit, and the district of columbia court of appeals where he defended individuals in high- profile cases and congressional investigations as well as fortune 500 cases -- companies. he just recently concluded the nfl agreement so we can have football on sunday. [applause] i will have mr. smith's are off by saying a few words. >> first, thank you for the round of applause. it is a pleasure to be here. it was billy's idea to stand up throughout this whole thing. [laughter] fine, fine. i will not take a lot of time.

i know a lot of you have questions and we will have a vibrant discussion. when you said i was elected in march of 2009, my first thought was, that is not right. that was actually 10 years ago. when i was 6 ft. tall. [laughter] it has been a very long and extremely public fight over the last two and a half years. i am most proud of our young men and their families because at a time when people were very quick to make a judgment about their resolve, there ability to stay together, their commitment to fairness, when many people doubted that they were capable of that, our young men demonstrated a tremendous amount of resolve. and that was really the only thing that got us through. when billy and bair together in the back, we tell stories about how it was not -- when billy and

i are together in the back, we tell stories about how it was not all about us. it was tied to the strength of the men and the families they represent. billy is where i was two years ago. the last thing i will say is that in a few minutes, your point to hear from one of my best friends. -- you are going to share from one of my best friends. barely remembers this, but in november of 2008 when i was being -- barely remembers this, but in november of 2008 when i was being considered for the post, he came to me with the idea of talking about his job, the job i wanted to have. three and a half hours later he walked out saying, i will continue to pray for you and you will be the right man for the job. he is an incredible man.

i have the pleasure to call him my friend. that is all i'm going to say. and i will concede to the gray- haired gentleman. [applause] >> if we sat down, i may have a hard time getting up. as i look around, this is an historical moment. i cannot think of another time in history where you have two african-americans heading up premier organizations. and also, to be part of an operation that generates billions of dollars a year. i have enjoyed the relationship. i actually served eight times as gene upshaw's lawyer -- served

for a time as gene upshaw's lawyer. it has been a long ride. when i look back, it seems time has gone by pretty quickly. it seems like only yesterday when i got here. there have been some interesting moments. we probably have two of the best jobs. i cannot think of a better job in the country that one can have, one, that you get a handsome salary, you get to hang with all of the celebrities, and you have all kinds of other perks. you get to travel the world and meet famous, important people. which is great, but the real pride is getting to work with these young brothers. in my situation, i head up an organization in which is predominantly african-american males. from my the vantage point, these are some great kids.

they're growing into men and that is where we are trying to help them to become in the process of all the attention that they get. been vindicated is not possible without them. the first walkout lasted about seven months. the players lost about $500 million. the owners lost over a $1 billion. since then, the amount of money that our players have turned has increased exponentially. in this past season, the players earned about $two 0.3 -- earned about $2.3 trillion. we are now in the throes of probably one of the most vicious battles i have been

engaged in. this is my third collective bargaining agreement i have negotiated. in 2005, we did not have an issue. we were able to reach an agreement in a matter of weeks. it did not take long at all. but this time around, i think it is going to be down and dirty, unfortunately. i was hoping we could avoid throwing this thing to the courts. but as you are aware yesterday, the commissioner and elected to bring suits against a young group of players. we are now engaged and responding to that suit. but we are still in the course of negotiating. i was surprised when he filed suit because on monday at negotiations, everything was cool. then he walks out and says in front of the cameras that the players are not negotiating in good faith, that the union is not negotiating in good faith. then he calls me the next morning and says we are going to file suit against you at 9:00

a.m. today. it is that it's -- if that is the way you want to do it, then so be it. what i did was called the labor relations board before hand and said it cannot this is how we are one to do this. we had meetings coming out and i thought it might be kind of embarrassing. but that is just the way it is. i think this is going to be a good, lively session. do not hold back any questions. it cannot be afraid to ask them. there may be some that i may not be able to answer because of the current status of my situation because we are still engaged in negotiations. and i cannot promise you that we will get an agreement before the season. i'm hoping that we will. the reality is that if we do not

get one collectively -- if we do not get one, collectively, the owners and players stand to lose about $5 billion. any questions you have, feel free to ask. [applause] >> the "don't hold back" was for billy. [laughter]

>> i have known believe for almost 20 years. when i was a young -- i have known billy for almost 20 years. when i was a young lawyer in the courtroom he walked in and i said, who is that guy right there? i will start with you, billy. as you said, the coming in -- becoming the executive director of the nba players association is probably one of the greatest jobs anyone could have. and i think when you go through law school, that is not really a position people think about how did you land that position? >> i had not thought about it either. ironically, i had gone back to syracuse after about 25 years and they had a coming together for the athletes. dave was a guy that i had helped recruit to the school. he was about two years behind me. we had gone back together.

i had gone into private practice from the u.s. attorney's office a few years before. about a month later he calls me and said, are you familiar with the nba players association? and i said, what is that? and he said, they represent the back of players, the union for the players. they're moving on an executive director and i think you're the guy for the job. i cannot promise it to you, but i would like to submit your resume. that is how it started. i got the interview and from there, i was interviewed by a group of players, michael jordan included. we had a three-day process where there were about 15 or 16 candidates from corporate america and private practice.

every day they would cut somebody. it was almost like playing football. you get cut and you turn in your book and you were gone. by the third day there were only three of us left. those three were myself, the man who is now the president of the dallas mavericks, and bill strickland, who was an agent from washington d.c. i was elected from the three. i was the guy that was chosen to become head of the union. that is how i did that. >> both of us have similar backgrounds -- prosecutors, u.s. attorney's office, private practice. in october of 2008, i got a call at the office from a search committee. they left a message and said, are you interested in a new job career? and to be dead honest with you caught -- with you, i told my

secretary, no, i'm not because in 2008 we were headed to an historic election and we all thought we would be able to select our first black president. i had been involved in the campaign and, really, on my rights and was potentially going back into government. -- on my horizon was potentially going back into government. a week later somebody called back and said, well, we are calling about the executive director job for the nfl players association. very similar to billy, it's are off as a process with a lot of candidates. -- it started off as a process with a lot of candidates. neither one of us started out in our careers saying, one day, i'll be sitting in this job. we would probably tell the person who said it to stop

drinking. it is not a traditional career path. but i think the gifts, or the things that you are able to learn in a job like being a prosecutor or of representing people in a very high-stakes situation, running a firm, being in a management position, all of those things are things i do every day to do my job. and to be blunt, i could not imagine a better training for what i went through and what billy went through. >> let me follow-up with you. you replaced gene upshaw, who from all i read had a very relationship with the owners. when they had to do a collective bargaining agreement, did

seem to go through pretty smoothly. -- it went through pretty smoothly. how much pressure did that put on you, seeing as how he worked for replacing -- as you work replacing jean upshot? >> we both have jobs where we would be lying to you if we said we did not work in high- pressure, high-profile, win/lose paradigms'. that is not much different from standing up in a homicide case, or a large scale corporate negotiation. it is all pressure. what i have always told people about the comparison that people want to make between gene and paul and roger and me is that, everybody tends to look at where those relationships and did rather than where they started. most people do not know that paul cross-examined gene upshaw

during the reggie white trial. early on in their relationship, i can promise you that from everything i have from everythinggene -- i have read about gene, there was not a day that did not start off were one of them was trying to tear the head of the other. did that relationship evolves? yes. i am not sure there are two other people that have been dressed in a more high-profile, high stakes relationships that roger and me. you try to move that relationship to a point where there is trust and mutuality and what you want to achieve. it does not mean that every moment is skipping down the lane holding hands.

but the most important thing you can do is to never take anything personally, make sure you understand your business objectives, and perform your duties at the highest level. that is how a deal is going to get done. illy, this is a good follow- up to not taking anything personally. how do you feel about making $320 million a year? >> i think it is ironic because in the negotiations, they said they were losing about $300 million per year collectively. and just recently been laid off about 120 people in the big office. they have about 20 or so teams that they contend are losing money, which we obviously

refused. there was a report in the paper that someone was earning $23 million. i cannot merge the two. it sounds like corporate america where you are cutting salaries and the head of the corporation continues to grow. we said, somebody needs to go back and reexamine things. the cracks at least, from my vantage point, every -- >> at least, from my vantage point, every time the nfl has renegotiated a television contract, the figure has gone up. i do not think i have ever seen the figure go lower. why do you sync with new contracts being negotiated at higher amounts -- why do you think with new contracts being negotiated higher amounts, the nba is coming up the latest?

>> because the issue is revenue sharing. unlike the revenue -- unlike the nfl, we do not have revenue sharing in the nba. his starkly -- historically, we have what is called an escrow where we have limited capital over the last five years. they hold back aid to 10% -- 8% to 10% of the player's salary. they were able to keep that 8% to 10% and use that money to distribute to those teams that were beneath the cap. it was a way of paying them to stay under. i kind of lost the question. >> my question was, you said the negotiations this time around seemed to be really tough. and everything i have read is that the owners are saying that everyone is losing money. but your contract negotiating for more money.

>> what has happened is that it is making it easier on the players. owners tend to react. they think the players should give back. i am not only during my tenure, but over the last four years or so they agreed to the imposition of a salary cap. and there were other restrictions that were imposed. they're constantly negotiating, trying to create the perfect system. in our situation, it is saying that what they want is a guaranteed profit after expenses for each team above $20 million or $30 million per year. all of these teams are looking for a guaranteed profit. but what i'm saying is that in l.a. or chicago or some of the big market teams, they need to kick back. that is part of the internal

problem. clearly, in that group there is a lot of fighting going on. it is much easier to approach and demand it from the players by locking them out than it is to resolve it within your own group. they may not own up to it, but i know that is a reality. that is what a problem is. he has promised them that they are going to have a deal structured similarly to the one that was imposed on the nhl in 2005, where they broke the union. we are not the nhl. the reality is that he made the promise that he made and it is not one that he gets to keep. i told him before that the only way he could get what he is looking for is if he endive bloody each other up for a while and we will see. -- if he and i bloodied each

other up for a while and we will see. >> the nfl has signed a 10-year agreement. the renegotiate television contracts and tend to get more money each time. did you ever think about signing a five-year or seven-year as opposed to 10-year? >> i think the ride up analysis for any deal is not the length, but the mutual part of the contract that benefits both you and everybody else. if two people get together and decide they want to do a business deal and the first thing you are talking about is when it ends, that is not the most conducive atmosphere for getting a deal because at that point, your internal discussion will naturally turn to, and i going to be better off after five years than he is. and if i am not better off after five, do i have an advantage to break the deal? it seems to me the right way to

look at any deal is to structure it in a way that provides for stability, a definite share of revenue, and in our case where we have the shortest career path, how to create a business model where we can try to make our players work longer in the system. if you end up in a situation where you have to trade the length of that deal in order to try to ensure that career years or longer, that is what you want. -- that carriers are longer, that is what you want. -- that careers are longer, that is what you want. we are looking at what is in the best interest of these young men who on average play 3.5 years. and every career ends on an injury, not by retirement.

if you start to decrease the amount of injuries, but also take steps to ensure that you will be compensated some way if you have an injury, those things become the drivers of a fair deal. >> can i piggyback on that? in our case, unlike the nfl, we have indicated to the nba that we are not prepared to do a 10- year deal. the longest we've ever done is a six-year deal with a one-year option. this past one expired on june 30th. the reason being, if they contend that they're losing money, then we are saying, why don't we do a shorter, five-year deal and to take another look at this thing five years from now? and the reason we are saying five years is because you mentioned the notion of the tv contracts and the rights that are being paid. the reality is, that is where

the revenue generators are. and they are extremely lucrative for professional sports. we know right now, the nba probably has one of the lowest rights to a tv contract. they did a 16-year deal about six or seven years ago and is due to expire in 2016. they are projecting over the next 10 years that they are proposing a four or five-year increase in revenues. they are projecting a 7% to 9% increase in revenue. that is conservative. they are projecting that this past year , total revenues past year $4.2 billion dollars.

with those kinds of numbers, we are saying, there is no way to have a 10-year deal. what you're proposing is that the players' salaries be frozen for the next 10 years and then they do not participate in any of that growth we are saying that the numbers are gargantuan and there is no way that we are going to have our players playing, providing the services and have people show up in an arena and not share in some level of the growth. that is why we are at an impasse. >> everybody takes a look at what we do on the outside and things they understand what it is. but both of us spend a tremendous amount of time in regular economic theory. it and in trying to figure out what the trends are going to be, what the growth rates are going to be, and those things become

significant drivers of what is good for your players at that time. our systems are similar in some respects, dissimilar in others. one significant issue for us is, you know, we are taking 55% of the television money going forward, which is a change over time. when those economic drivers and your respective analysis of those things -- those economic drivers and your respective analysis of those things become very important is going to be -- become very important. it is going to be x plus. >> right. >> the people in hockey in the nfl. it is the elephant in the room. it generates more money than

basketball, hockey, baseball. they just do not begin to compare. it generates about $10 million per year. >> i am not getting paid $10 million per year. you make it sound like it. [laughter] >> billy, i know the last nba collective bargaining agreement is when they implemented a decal on rookie salaries -- the cap on rookie salaries. what i noticed in the new collective bargaining agreement, i noticed in past years there were new rounds of draft picks. i saw that one player signed for

about $50 million less than the year's previous first-round draft. >> correct. >> is there now a salary cap for rookies and? >> know, what we did in our system is to look at -- and no, what we did in our system is to look at the top 10 to 12 dropped and that impacted the overall rookie pool. -- 10 to 12 in the draft and that impact the overall rookie pool. what we ended up doing is basically freezing their rookie pool for 2011 at virtually the same amount that it was in 2009. we do not have a cap system, but a pool of money available. the other issue came back to our

fundamental principles. those top 10 dies, there is no other way of looking at it. guys, there is0 die no other way of looking at it. they were able to make an increase in the system. but we were able to push down 613-32, and remember, we have grounds -- we were able to push down picks 13-32, and remember, we have other routes. most of the gunmen who come and play football for us have annual thanies that are lasless $600,000. we pushed money down, but then we also pushed all lot of that money into proven veterans in

the locker room. because you do have a number of veterans of black proven themselves in years two, three, -- of the veterans who have proven themselves in years to, 3, 4, 5, and six. the idea was to push down in spring. >> that makes sense. these and gentleman in the audience, i have a few more questions i'm going to ask. if you have questions, you can start approaching the microphone. billy, do you think we are going to have an nba season? >> if i had -- >> if i had to bet on it at this moment, i would probably say no. and the simple reason is, because i have not seen any indication at all -- and i have been dealing with david now for 15 years, david stern's.

this is the first time where i am somewhat befuddled because i have not been able to read him. i think he can read me in the sense that we are both dead in -- dug in. the constituency has changed in the sense of owners. in the past he has pretty much had carte blanche. but in the past six or seven years there is a new group of owners who have come in and pay premiums for their franchises. they're kind of holding his feet to the fire, so even if he wants to negotiate with me and make a compromise, he cannot listen. we are $800 million apart per year, not for the total deal, per year.

the owners started out in august, 2009, demanding that we give them back $1 billion per year. then they came down to $900 million. a month and a half ago we made a proposal that would give them back $100 million per year and we would do a five-year deal. it was $550 million over five years. they said that was a nonstarter. they said no way. they needed $900 million and unless we were willing to give them that, then we were just not negotiating. we said we repaired to talk about other things, tweaking the system -- were prepared to talk about other things, to begin the system. we can make adjustments that you need and help those teams that you contend are struggling to revenue sharing. revenue-sharing has been raised in the meeting, but it always

send a detour. the only way there will be a season is if something -- i will not take catastrophic, but something has to happen that both of us can use as leverage to save face. i cannot move to him. do you know what i am saying? >> right. >> and he has taken it so far away -- on our proposal, we have a guaranteed 57% with this last deal. when we agreed to give back the $100 million per year, that takes our percentage down to 54%. but where they want me to go down to is at 47% and that is just ludicrous. it cannot be. there has to be another way to

resolve this. something has to happen in order to convince those groups -- that group of owners who are preventing him from being reasonable to allow him to act. >> what if kobe bryant, kevin durant, derrick rose, lebron james, dwyane wade, for example, signed with european teams while the lockout goes on? >> they have extended contracts, meaning, that contracts that extend beyond the current season. if at any given moment there is a resolution, then they have to have an out in their contracts. but i can assure you that every marquee player who ends up signing to go to europe or asia, it is opening highs. i know it has got to be causing

some stress within the ownership community. them that weref able to get $3 million in the philippines for two exhibition games. it was kobe, the rose, kevin durant, and eric fisher. he reached out to derek and he put the plan together and told them what they needed and they made the plan. a kind of opened their eyes and they begin to open -- understand more about the business. they clearly know what their own personal worth is on the international and global market. i do not think there are any players in the world who are better known globally that nba basketball players. i think it clearly had an impact. i do not encourage them to go,

but by the same token, we are not quite to stand in their way. >> at this point, i will open it up for the audience. we have been going for a while. can i give one caveat to the audience, particularly as it pertains to billy hunter, when we were attorneys and if someone asked what his strategy was, he would not tell them. you may want to avoid asking him what his negotiating strategy will be. >> i am a retired judge from cleveland, ohio, howard law class of 1970 along with billy hunter. my question is this, we had a sports seminar on monday and in that seminar there were a lot of questions, or comments about the

difficulty of african-americans being able to become agents for the professional players. i wonder from both mr. smith and mr. hunter, if you have any suggestions for those persons that might want to get into that area. >> let me acknowledge who judge collins is. she and i were part of a group in 1968 that went to howard law school. [applause] and what makes it so unique is that i think she was the valedictorian of our class. [applause] when we convinced daisy to stand with us, we felt we had accomplished something. becoming an agent is not

difficult at all. all one has to do is get an application. you file it and you ultimately have to take a test. we do a background check and if you have a college degree, you can become an agent. what most people are alluding to is how to become a successful agent. i cannot tell you how to go out and get the players. because that is the key. when you break into this business, it is a high-volume investment. because most of the major agents -- let's be straight. they have runners and they identify kids on these teams. and they take care of somebody along the way because they have these relationships. and that is how it is. if you look at the blacks and

the economic stress that we are suffering, if you're a kid with any kind of talent and people come around and tell you what they can do for you and they offer you $50,000, then you might be inclined to take it. it is not lawful, but we know that happens. that is what we are competing with. if you know the kid and you have a relationship with him or her aunt their parents, that i -- and their parents, then i suggest to cultivate that relationship. they may look back and taking with them. -- take you with them. >> when the owners talk about

losing money, they always talk about from the revenue side, never the equity side. for instance, jerry jones bought the cowboys for $1.2 billion? >> no. >> what did he buy that for? >> $400 million and some change. >> what are they valued at? rex the average team has increased in value by about five and a% in the last 10 years. -- about 500% in the last 10 years. if the only reason that teams increase in value are primarily the driver of the tv contracts that drive overall revenue, then you see revenue in our sport go from $4 billion to nearly $10 billion in as many years.

do the players read a benefit of the tv contracts? yes. do the tv contracts bump up the price of the teams it? absolutely. the more nuanced question, i think, is, when a team cells, does the player gets a portion of that selling price? know. i think that is what you mean. >> right, and these injured -- these individuals are producers. they are not employees. they're the ones that produce all of the revenue. the top earners at goldmansachs, they make more than the chairman, and they get stock options and what have you. basketball players cannot own basketball teams. football players cannot own football teams. these football players and

basketball players are precluded from the equity side of whenever we get on tv. and this is not to knock you guys. but whenever you hear on tv about them losing money, but you never -- i mean, the value of the team never goes down. >> correct. >> why is that not brought out? if you want to preclude the franchise player from moving, why can't he get a piece of the franchise? >> nothing would make me happier. and nothing would make billy happier. i think the executive director should get a piece of those teams. [laughter] you are preaching to the choir. we are in the church. there is not a time that billy would not want that for his players or that i would not want that for my players. that becomes the holy grail of

where the line in the sand is between the owners and players. i feel you. nothing would make me happier. at a time when we were in our battle, one of the proposals we had was, fine, if you want money back, give us a share of the national football league. that did not go anywhere. [laughter] i thought it was brilliant. that is because, for any number of reasons. i believe you and think that one of the more creative models going forward in sports could be something like that. >> i want to end by saying, we have advanced to the point with these individuals were one day, when they start getting equity

in what they are building. jones goes to see jefrry catch a football. no one cares who the owners are. we care who the players are. it might be because we are black. the majority of them are black. we need to move to the point where we open the public's eyes not only to the income side, but to the equity side. if you were a ceo of ibm, you get a salary and he gets stock. 10 years from now when you sell your stock, you sell it at capital gains. you do not pay the income tax. you pay 10%. you get a break there also. when they are saying that, a lot of people do not realize. the owners are making out like bandits and robbing the players. what do these players have once

they are finished? thank you. [applause] >> i appreciate the brother's question. we have a lot of people in line. if you can ask the question -- >> good afternoon. i am an attorney. >> can you speak up a little bit? >> i am an attorney in new york. my question is short. with revenue sharing been a crucial component in negotiations and being a benefit to the players, how do you navigate through the process of making sure you are being the best at the kit and there are not terms that are at first with interest being -- best advo

cate and there are not terms that are at first pertaining to their interests? >> one facet of this deal was the players on the national football league created 8 $1 billion benefit to the former players out of this new team year deal. -- ten year deal. that was an important and significant issue for me when i took the job. we stand on the shoulders of others. we were able to get the owners for the first time in history. it is 2011. it is the first time in history that teams have contributed to the pensions of former players. [applause] to your other question, that is

what our job is. we sued the owners over the tv contracts they negotiated in the past. we believed they were structured in a way that hurts the players. in this deal, we actually increased the language on revenue maximize asian -- maximization so that the lawyers have more tools to make sure that when the contracts are negotiated, they are negotiated in a way that the owners are putting on two hats, representing the interests of the players and the owners. >> thank you for the question. can everyone speak up? it is kind of hard hearing you from here. >> i am an attorney in texas. we have seen on both sides of lots of strong leadership from the players, a strong group of

players coming out and speaking out. i have also are heard bus from players and about in leadership who have their own -- buzz from players who are not in leadership about their own positions. what role do you think leadership plays in the cohesiveness of the team and the players? does that issue come up in negotiations? the longer this goes out, the more frustrated everyone is going to be, particularly if you are looking toward having a season at the end. >> player solidarity and cohesion is the single most important factor. in our history, strikes in the '80s had significant high- profile players to cross -- 1980's had to death in high- profile players will cross over. -- had several high-profile

players who crossed over. i did not have any problem calling them out by name. they heard their fellow players. one year ago, we started the season in minnesota on that thursday night with drew and new orleans saints walking the midfield and hold the one thing you are up to represent the solidarity between each other and our fans. that is the way we started. that is the way we finished. i do not care how good we are in negotiations. your opponent is always sitting there thinking that your players are not going to stand together. until they become convinced that that is not going to happen, that is when things change.

>> in 1998, when we went to the lockout, we started two years before meeting with the players. we were prepared -- we were not as prepared in 1998 as we are today. we were able to hold it together for several months. the commissioner thought he would be forced to cancel the season. this time around we went the same amount of time. we better prepared our players. if our players are locked up for the year, they can withstand the lockout. i think the owners know that. they are prepared. we have to be prepared to hang it they are shutting down for a year. that what we have to do. one of the problems you run into is the length of the career of a

professional athlete. they are short. the average basketball career is four years. the average fixed -- average football career is 3 or four years as well. what year is significant. if he is going to earned 5 million this year and 5 million next year, he is going to lose that time, particularly at the end of his career. that is a hit he is taking. that issue came up in 1998. at that time patrick ewing was the president of the union. he announced he was prepared to blow his entire salary for that year. because of the position that he took and the respect other players have for him, we were able to hold everybody together. he was prepared to sacrifice $20 million. some players were saying, he is already getting $100 million. for him to lose $20 billion, is no big deal. but $20 million is $20 billion.

-- but $20 million is $20 million. when i let it barry fisher, i know that he is at the end of his career. he has -- derek fisher, i know that he is at the end of his career. he has been pretty strident. he has dug in the same way that to you in dug in. it all comes down to, we can have all the negotiations in the world. it is power versus power. as long as the players are prepared to stay, we will get where we need to go. >> good afternoon. i am from west palm beach, florida. my question is for mr. smith. i read that you got the players to buy into an insurance policy that would cover them if the

lockout went beyond what was originally anticipated. can you talk about what impact that had on the negotiations? >> yes. [laughter] >> i will claim privilege on that one. >> why my question? >> later, we will talk. >> i am an attorney in boston. i will not ask you about performance enhancing drugs. i have a more narrow question. in our communities, our players and celebrities, our leaders in the philanthropic efforts that benefit our communities -- can you give us insight into their thinking and their advisers in setting up their own individual charitable foundations for every kind of issue that has impacted their lives rather than just

partnering with well-established existing charities that are also addressing those needs? i have seen, over and over, a lot of these foundations are utilized for marketing purposes. they do not comply with the law. players like ray allen did not go set up his own diabetes foundation. he partnered with a diabetes foundation, a well-established foundation. it has been effected. the majority of them are advice to the contrary. >> on the football side, i disagree with you. if you look back larry fitzgerald on our side -- the last time we took a look at players set their own foundations and gardening with others -- that is what we encourage. i want our young men to be managed businessmen in the business up with ball.

when you have your own sense of worth more about you or assets, go out and try to do something that is good on the basis of your own value and asset. we spend a lot of time in our office advising those folks on how to set up their own charities. there is nothing wrong, obviously. there is nothing wrong with partnering with well established charities. i love the fact that you have guys like o.c. who are building villages in his homeland of kenya. i kind of thdig it. he can step out in the new york community and demands that kind of step from others to become evolves -- become involved. >> some of them are not getting good advice. >> this is the range. i did not answer the question

about the question of becoming an agent. how you become a good one? i have been aggressive about our agents. i am sure that if any of you know them, they will tell you what they think of me at times. [laughter] it seems to me that they have an obligation in the same way that we, as lawyers, have a myopic relationship to the person you are representing. at the end of the day, the issue comes down to how good of a representative you want to be. your question is, if they are doing their job, they are telling these people that there are all sorts of things they can do in their communities to make their communities better. the focus has to be not on how i get into it, but what is going to be devalued when i do?

>> i cannot think of any bigger group of philanthropic professional athletes that exists in the nba. 90% of our players have foundations. they set them up not under our direction or advice but under their money managers. there were issues in the foundation and they thought it was a way to employ their family. we had to dilude them of that notion. they could not do with that way. we have assessed our players a certain sum of money. that years ago, we shipped 10,000 tons of rice to kenya. i took a group of players over there. we fed 120,000 kids a day for over one year. he never read about that or had any idea that it occurred. after pretoria, we were the

first was on the ground after -- after hurricane katrina, we were the first ones on the ground. we sent items to new orleans and baton rouge. after the world trade center, we get $2.5 million to be victims of the world trade center. we wanted our players to be more involved and more charitable. we are always encouraging our players to do it. we have a litany of things like that that have occurred. most recently, last summer, ron artest was one of the players who went to kenya. he gave $100,000 to have the kid operated on. it was a successful operation. we do not advertise these things. i can give you a list of things in the players historically did.

they cannot go around announcing it. the need is so great that you are praying to crack the door. if you crack the door, the next thing you know, you will be inundated with people from around the country who want us to make a contribution. we are not a charity that way. we have a limited pool of revenue that we are able to access. we have to be pretty spartan about how we use it. >> we are on the same page. we just need them to be more responsible. >> i am a lawyer from chicago. i am wondering if either one of you could react to the book, " $40 million late." could you give us some insights -- "$40 million slave."

can you give us some insight into becoming an owner. a few african americans have tried to get into owning teams with limited success. i would love to hear what you think about that as well. >> i can reference michael jordan and bob johnson. when bob johnson decided to bid for the charlotte bobcats, it cost him $300 million. he not only had to pay $300 million for the franchise, you do not just by in and it is off and running. when you look around, i do not know how many people we have in our community who can step up with those kinds of numbers. you have to put together some

groups. i assume that if you have a group of people that you think are prepared to buy an nba franchise, give me a call. [laughter] >> give me a call and i will see to it that you get the kind of introduction you need. >> would you say that is important in terms of a group of lawyers getting together and having those kinds of conversations? >> it is definitely important. we need to elevate our game. i come out of oakland. i am important and less to be sitting here. when i go back and talk to my colleagues that i practice law with, a lot of them are struggling. they rely on the black community for their business. we are the most stressed group in the country.

our people need all kinds of legal services, but they do not have the wherewithal to pay for them. i think we need to have these discussions. we have enough ball players in the nba to buy 18. they are barred from doing that. they do not allow players to invest in franchises. maybe we have to change the thinking of that. it is great. i said to the nba owners i am dealing with, if they get the deal they are proposing, that would guarantee them $20 million or $30 billion per team profit. the reality is, the value of the franchise will go through the roof. coupled with the fact that you have this guaranteed income coming in, that is something that we all should be looking at. >> hello.

good afternoon. thank you for joining us and thank you for speaking. as a recent graduate from law school, it is great to hear african americans speaking. my question is about civic engagement. you often see teacher's unions and police unions affecting the political process and donating to campaigns. is there any room for the nfl or the nba player association's to affect the political process? can they make a political action committee? can we see them advocate on capitol hill or in state houses? >> i may know a secret coming out of the box. we spend a lot of time on capitol hill and in statehouses all but the country talking about the economic impact of the lockout. everybody focuses on the limited pool of athletes that are going to be affected.

down the street at federal express, they have 8000 workers at that stadium who would lose their jobs if there were no games. countrywide, there were 550,000 people who would be impacted from the lack of games just in the stadiums alone. forget the bars, restaurants, collateral services. one of the things that came out of it was, our young men got a different perspective of life outside the bubble of football. the way you build on that going forward and the way we will build on it going forward is that, now that we do have labor peace for a little while, take that spirit and understanding that you can impact the lives of everyday people and move it into another direction. they have to do that. it is the only way to take advantage of the gift god has

given you. >> when you look around and talk about role models, professional athletes and entertainers in our communities are the individuals who have the greatest ability to impact young folks. we need to become politically active. bookne's reference the "$40 million slave." the problem is, you get a player who has a brief career in the nba. he has struggled all his life to get there. he gets there and he is looking at all kinds of marketing opportunities and he is going to make millions of dollars per year. the people around him, they advise him that he should not. there are certain things he should and should not do. we are thinking about creating a political action committee in

nbpa. we are going to check with the teachers in wisconsin who are having a problem. we said, we should have a political action committee so we can be more involved. we have been working on that. >> thank you very much. >> i have a question about your everyday lives we are not negotiating a contract. you have a 10 year deal. what the do now? [laughter] >> sleep. >> you know. being careful. i have not talked to my wife. i am afraid of her. the challenge is always about

whether there is stuff that you can put on a mountaintop and try to climb to get it and whether or not that is enough to keep you going every day. i have not given a lot of thought to what happens in the next two years. we have begun to map out where the players need to be over the next 10 year span. that is what i will work on going forward. i have had come stations with the executive committee. they want me to stay. i want to stay. we are going to end up working it out. all of the things you have heard people talking about are things for us to work on in the next two years. we supervise our agents in the national football league. how do we do a better job of making them better stewards for the man they serve? how do we make the game set for -- say far -- safer for our

players. we treated concussions in a way that nobody treat concussions anymore. the concussion issue is still there. long-term care needs to be better. there is plenty to do after i have a vacation. that is the thought. >> enjoy your vacation. >> i am monty cooper. i have a question about concussions. for the long term growth of the league, is also a curious of how it will go. i imagine it will lessen the length of players in their careers 0.4. just your thoughts on that -- i imagine it will lessen the length of players in their careers going forward.

>> we took an aggressive position on what we thought needed to occur to make the game safer. as medical studies improve, we are going to continue to take tough stands. one of the things i will leave here and try to finalize negotiating is a medical accountability standards that, for the first time, we will put in the collective bargaining agreement. we had a medical director for about 10 years on our side. his obligations, the league's obligations to him or her have never been defined in the cba. i want to set a position where the document that govern our business is also a document that gives us tools to address our safety. yes, there will be continuing

issues. i got a report on the way in about a player in philadelphia who collapsed under the heat. one of the things i will be jumping on quickly is but that situation is. in this new deal, we eliminated two a day practices for the first time in history. [applause] >> i was not playing. that was a huge deal for our players. in fact that that culture of hitting twice a day during training camp -- that is gone. we have limited the number of practices for the entire season. we have lengthened the term of the off season. i created something called a spring semester. most of our teams are done playing in january. the idea was to push the off- season to late april or early

may so that those young guys who dropped out of school to play football can try to avail themselves of this semester in college. [laughter] [applause] there is stuff to do. >> oma isr tayler -- omar taylor. given the fact that you are representatives and advocates for the rights of players and you have ideas on revenue sharing and profit sharing, my question is what are your thoughts on revenue sharing. these players are making millions of dollars, especially in basketball and the ball, especially for these institutions, and receiving nothing in return. [laughter] >> we have had this discussion many times in our office. as it relates to our

negotiations, one of the things that the n.c.a.a. is pushing for in conjunction with the commission is they want to extend the age limit. it wants to make sure players stay in college through their junior year until they are allowed -- before they are allowed to come into the nba. we have worked out our agreement with the exception of the part about age. to bring closure, i agree to give up a year. the kid could not directly come from high school. he would have to spend one year out of high school and he could come into the nba. from my perspective, there is a lot of money being generated for these colleges by these kids who are playing. in our case, we found that it was something like 70% of the kids who go to college on basketball scholarships ever graduate. that is for those who actually

stay in. that is something we have to visit. going forward, there should be a process put in place, some structure that allows those athletes to be paid. the n.c.a.a. end up negotiating a deal of $9 billion over 11 years for march madness. why shouldn't the players participate? why should a coach be played $2 million a year and you played for a meal ticket and he determines what kind of shoes you are wearing because he has a contract with nike. you are doing all of this stuff to promote his quality of life. the players should be impacted likewise. these universities benefit tremendously. we should try to run some of them to historically black colleges. [applause] >> we are at the end of the

program so i will only take one more question. >> my name is robert louis. and i am a bankruptcy attorney. for the first time, a major league team declared bankruptcy. how would that be in -- the league if 18 declared bankruptcy? >> we had the case of the new orleans cornets -- hornets. in our negotiations, the issue of contraction has come up. they have said, if you have to contract, so be it. it impact the number of jobs. there were countervailing arguments for someone said, if you reduce the number of teams,

you will affect the quality of play. i do not see in the nba teams on the horizon that are on the verge of bankruptcy. in the case of the sacramento kings, there were representations made about how they were having difficulty. nine years ago, they were my of the -- one of the pivotal teams in the league. if you have a product that is good, people will come to see. if you have been incompetent -- incompetent management, people will not come. i am not concerned about any teams going bankrupt. we have people lined up. when they say they are losing money, i cannot understand why people are lining up to buy the

franchise. it does not make sense. why would someone come to play or hundred $50 million to buy the golden state warriors. -- or hundred $50 million to buy the gold is state warriors-- $450 million dollars to buy the golden state warriors. the contracts would have to be liquidated some kind of play. i do not think those contracts can get bankrupted out. the obligation would fall on the remainder of the league. >> is that something you have in your collective bargaining agreement? >> no, we don't. >> the viability of different clubs -- we spent a tremendous amount of time on the macro economics of the national

football league's. on the economics of team transition and whether teams are maximizing revenue, some teams do a tremendous job of driving revenue and some teams down. now -- and some teams do not. now is the time 14 to become involved in the economics of their game. there could be this mentality that, what we do on our side -- let's just talk about the players' money. we are partners in this business. if you do not take an aggressive approach on the macroeconomics of your business, you are not serving the players well. >> thank you. >> on behalf of the national bar association, i would like to

thank everybody in the audience for attending this program. i want to thankbilly and demaurice. i know for a fact that on monday, i turn on my television and i see billy on television. i do not know if billy is going to make it. they did a lot to be here on this panel. we appreciate you guys. you are a great role models for us as attorneys and as african- americans. we are proud of the work you do. [applause] >> thank you very much. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] >> as a point of personal privilege, as president of the

national bar association, i would like to thank the panel, billy hunter and demaurice smith for bringing this subject to the national bar association. i want the record to reflect that they approached me for the plans -- with the plans for this forum. they took their time to give back and be with us today. we should give them a standing ovation. [applause]

>> tonight, we will be bringing you live coverage as the young america's foundation continues its national conservative student conference. will talk about the republican party. that begins at 8:15 p.m. eastern on c-span. >> did you get 8 weeks of vacation so far this year? >> alyona minkovski takes a slightly irreverent view of washington. >> we are willing to try something different to make television news exciting and entertaining and informative again rather than the garbage

that it has dwindled down to. >> she will talk about her that work at her show sunday night on c-span 's "q & a." >> 8, 9, 9, -- >> 7, 6, 5, 4, 3, 2, 1, 0. >> these are the stakes. to make a world in which all of god's children can live. we must either love each other or we must die. >> vote for president johnson on november 3. >> we will look at the history of political campaign advertisements. and former homicide detectives

on the day jack ruby killed the man under his protection, lee harvey a lot. and how lee harvey oswald's messages were crafted and communicated. american history television. >> next, a discussion on the history of debt reduction commissions. a political science professor at george washington university examines the joint committee on deficit-reduction and gives a historic context of presidentially appointed committees. this runs about 40 minutes. host: let me introduce you to sarah binder, a political science professor in washington, d.c., at george washington university. she is also at the brookings institution, a fellow in governance studies. our topic is to learn more about the experience this country has had with special committees and

commissions, such as the want it has now created for handling the data and deficit -- handling the debt and deficit. i was struck by a headline in this morning's "washington times." "politics in every choice facing deficit panel." my reaction was, as in every committee -- hasn't ever committee at truces to make? committee haty choices to make? guest: absolutely. just because the committee is treated as not make the work any easier. host: they have been around for a very long time. even in the 1800's, congress was creating a special committees. do you have a sense of in the modern age how often at they have been successful? guest: if we had a comprehensive list and were able to figure out which ones work and which ones did not, the larger history is that they tend not to work could

having said that, if we really had this list, they would be apples and oranges. some have the statutory authority. congress creates them. some of the president creates througexecutive orders. obviously, this cannot have much authority. some are members, some are private citizens, some are mixed, some equally split between bodies, some of the role of entitlement. in the end, we he a couple of successes and we can learn from the examples where they did succeed. but by and large, just creating a committee es not lead to success. host: your writings suggest that every decision about how congress sets it up as an indicator of what its likelihood of success might be. to construct a statutory -- the concept of the statutory is important. is this considered a statutory committee? guest: absolutely.

it is written in statute. congress passed a law. it establishes the committee, and many democratshere will be, how many republicans there will be. there are deadlines set into law. it is not say much about the jurisdiction break and be pretty wide-ranging trade taxes, spending cuts, entitlements. everything is fair game. if it gets a bipartisan vote, then the house and senate really are forced to vote up or down on the package. it is an event that most of the committees and commissions will never have -- it is an advantage that most of these committees and commissions will never have a. host: you suggest that most of these are anbvious effort to kick the can down the road, structured in way that nothing is likely to happen. but this one, because it is written in statute and has a trigger mechanism, what does that suggest that congress' intent is?

guest: keep in mind that there are all eyes on congress in reaching this deal. if you don't come up with a credible commitment that we trust you are going to addrs these deficits, we are going to downgrade the debt. in creating this committee, kicking the can down the road is prettyusual. but if they fail to reach a decision, there will be these triggers with automatic cuts in defense spending and entitlement spending. that is what is different here. meers fought down the road that there could be a lot of deadlock. there could be deadlock in this committee. these members an incentive not eo deadlock -- let's giv these numbers an incentive not to deadlock. host: what we are focusing on is the construct of the special committee congress is setting up where all members of congress

-- the appointments have to be made, report back and it has the trigger mechanism. if you have questions about it, if you laugh, it's about it, if you watched other committees and commissions -- if you have comments about it, if you watched other committees and commissions createin the past, we have the addresses on the screen. you mentioned others we can look to as good examples. what are they? guest: by most accounts, brac, base closing realignment commission, established by law in the 1980's and 1990's, set up the process of closing military bases that were obsolete, or whose purposes could be moved to other installations. congress authorized an external commission to come up with a list of bases, run it by the president. if the president signs off -- he

cannot pick or choose -- those go into effect, unless congress chooses to reject the entire list. getting their hands on it, picking it apart -- is a pretty big commitment if there ever was one. there were two or three rounds of a very successful base closings, because congress tie its hands so tightly guarde. host: my memory of the brac hearings -- we cover all of them -- was the date of the final decision, how communities were covering it, because of the effect on their own community. do you expect that this commission -- that was not televised, so let me use that as a segue -- thawas all

televised, so let me use that as a segue. how often do it all-member committee's work at a public? guest: we have sunshe laws where we have to do the business in public where it is typical to close the doors. there is a lot pressure for memberto open the doors of this committee. coursethe more transparent and the more sunshine offered, the harder it is to reach compromise, because everybody stake out positions, and i would actually hope that this summit -- that there's some degree of closing the doors to make this process work. host: let me move to the members. how many lawmakers will be on the panel? guest: committee of 12, six democrats, six republicans. host: is a majority vote or unanimous vote? guest: the requirement of the law is a majority vote. host: 7 members have a lot of power. guest: they do.

of course, their decisions are subject to an up or down vote on the chamber floor. host: how the members selected? guest: they tell the speaker of the house, the majority leader and minority leader of the senate, each of you choose 3. host: let me go back to the article started with. "within two weeks, the leaders of the house and senate will name lawmakers for the committee. no leader can afford to appoint a wild card might stray." guest: absolutely. this has been out of discussion, other ways in which it they might and the appointments year. -- it had a discussion, otherwise i which they might have done the appointments here. they want some certainty, greater certainty about what the committee is going to do. host: montana, first up, jack, a

democrat. caller: my concern is that lots of members of the republican party in congress have taken this grover norquist pledged not to raise taxes under any circumstances. don't you think that is an inherent conflict of interest for someone to serve on the commission? guest: well, it's certainly complicate the work of the committee if there are members who, in with clearly stated -- who come in with clearly stated public positions to not raise taxes. having seen at the negotiations between john boehner and obama, the gang of six in the senate, there are lots of ways in which the committee might comep with the revenues to reduce the deficit that don't explicitly in l -- involve interest rates themselves or individual tax

rates. there mighbe more room for compromise than mes the eye, but i think you are tapping the concern here that we don't want the cake baked before you put it in the oven. host: going back to not appointing a wild-card -- "the leaderhave an incentive to name loyalists who follow party orthodoxy -- self preservation. no one wants to lose seats in the next election or as a rebellion by rank-and-file lawmakers that might cost them their leadership posts." the tea party. guest: absolutely, and it points to another element, the diffulty reaching decisions in the committee, not just policy differences. not just differences about how much to cut or where to cut. those you can find compromises over. i want $100 billion, you want to hundred billion dollars, we compromised at 150 billion --

you want to hundred billion dollars, we compromise at $150 billion. it is really hot, given the control of the housend senate and control the white house up for grabs and others come up for election. host: a tweet -- guest: well, ihink there is some hope by legislators and lawmakers who set this up that perhaps there could be an alliance in this group. selecting the members really makes us scratch our heads about how much room for coromise there really is. host: connecticut, or republican gues. caller: the question i have for the professor -- hello?

host: willis 9. calle -- we are listening. caer: she mentioned that once they send the report, the congress cannot do anything but an up or down vote. i don't understand that, because i believe congress can amend anything they want. i don't ite understand that. guest: it is a very good question, the authority congress has to delegate and make choices. of course, the constitution says, article one, that the houswill each have their own right to set their own rules. the framers did not want to micromanage how congress is going to do its business. the house and senate want to create a role and our committee, constrain the right to amend a bill, that is really within the bounds of their authority, and that is precisely what is going on here. justice that the senate -- jt as if the senate has a rule that u need 60 votes.

host: tyrone is wating us in pensacola, florida, an independent. caller: it is interesting, and i don't know if we can characterize them as an in- group, because it seems to me that they will take people or like-minded. the republicans will have like- minded people, and the democrats. all we really just taking this fight, taking the ire the public is directed towards the speaker and the president and democrats and republicans and fusing it on to all people on 12 people and we will have the same kinds of results and bickering and in fighting the experience in the republic debates we have seen thus far? guest: again, i think that is a very reasonabl concern. the politics that lead to deadlock or deficit reduction deferred to these committees and the firs place in. of the conflict we see in the

chambers. having said that, this is a little different. this as it triggers of automatic spending cuts if the committee fails to act. those triggers are supposed to be draconian and half that it induces compromise and an agreement in it -- draconian enough that it induces a compromise and an agreemenin the committee. it gets much, much harder for them to throw up their hands and say we cannosolve the problem. vivian, an -- charleston, south carolina. are you there? caller: yes, good morning. thank you for taking my call. my question is regarding the trigger, with regard to making a decision as to if that they don't come up with an agreement, regarding the entitlement, that there would be a reduction in

entitlements, as well as defense spending. est: yes? caller: is that going to work? it are they going to be forced to do that? how is that going to help revenues? i know that is not a part of it, but how is it going to increase revenues? gut: well, clearly, by cutting spending, that helps to reduce that deficit. is the trigger going to work? that really gets to the heart of the problem here at the challenge here for this committee brought some people speculate, is it possible that some, for instance, republicans on the committee, is it possible that some of them mightrefer these very, very steep cuts in defense department budget to a package that actually includes the closing loopholes? is that possible? is it possible that democrats would prefer draconian at medicare cuts, given the alternative of what could come up in a grand bargain?

of course, the cuts -- if the trigger were to come down, those don't go into effect until 201 there is the possibility that congress could revisit the cisions to avoid the cuts. it is a little harder for them to undo the package here, but it is always, of course, within the realm of possibility. host: within -- when they get to the annual appropriations process, could they make different suggestions that what the committee suggest? guest: they at contrib -- they could. the law sets caps for the first two years, but the decision on which programs get cut, which ox gets gored -- there is a lot of politics still to come over the shape of these spending bills. on the alanet

simpson and bowles commission. are they likely to provide a framework? guest: that is definitely at the hope of economists and others who have been looking at what is going on here, and it turns of the likelihood -- in terms of the likelihood coming out of a good deal, grand bargain. the bulls since then commission -- the bowles-simpson commission laid out a plan, and there was the rivlin-domenici commission and others. they are not starting from a blank slate here. the work of these commissions could be quite valuable. host: let me ask about one commission fm a generation ago that dealt with that social security. in 1983, alan greenspan was asked to chair a social security commission appointed by congress and the president looking at options for the viability of the social security, which led to

the social security reform act of 1983. house that lood on in history? the suess or not a success? guest: there was the thought that it saved social security from the brink of collapse. the social security commissioner early on said that the commission pretty much in deadlocked. they had findings and and they knew there was a crisis brewing. president reagan stepped in, tip o'neill, the speaker, stepped in. they brought it to the commission and the commission agreed. would give the commission cut it with working. it is part of -- the story -- we give the commission credit with working trade is part of the store, but it took political intervention to make it work. host: what are the lessons?

guest: there is something with the committee by giving it a statutory authority, by treating triggers -- creating triggers. it stacks the deck in favor of the committee. but it's a guess that in the end, given -- it suggests that in the end, given that the parties are polarized, it is hard to see a grand bargain without the president and the speaker and the majority leader in theoom to hammer it out. host: sour reminder political scientists and has the -- expertise s -- sarah binder is a political scientist and has expertise in the structure of government. we're talking about special committees and the want congress has created for the debt. eric on the republican line. caller: thank you for taking my call. i have one question and one

comment. under the constitution, it is mandatory that all revenue bills originate in the people's house, the lower house, the house of representatives. in as much as there will be senators involved in this bill, on which you must vote up or down, i do not understand how such a hybrid bill would conform with the mandatory requirements of the constitution. the comments i have stems one of frustration i have 1 people say that the rich should pay their fair share. the most recent 2010 irs table indicates that the top 10% of all taxpayers by 70% of the total tax bills -- pay 70% of the total tax bills. i do not see how that is unfair . host: the second is a politics qu