>> you have some grumbling. i have rules, too. item 56 town hall meetings. we have all the same rules, wait for the microphone. to say who you are. we have a role that is really important in in new jersey. even though i am on foreign soil, i will enforce this rule. there could be people who do not like one of my answers that would disagree. we walk and then to stand up. if you express said in a reasonable and respectful manner, you get a reasonable disagreement in return. however, if this is the day that you decide you want to impress your friends on television and you decide you want to take the

governor out for a walk, i will give you the role i given new jersey. we are all from new jersey. if you give that, you are getting it back. >> never mind. >> if you are running the country, what would you do to win people -- wean people off entitlement stacks what would you -- entitlements? would you do to turn around the country? >> we have examples of what we have done in new jersey. equivalent on the federal level is medicare, public sector

pensions, and health benefits provided. i mention that those items where underfunded when i took office. $121 billion underfunded. that is four times our annual state budget. what did we do? i went out september 2010. i put out a specific plan. not a plan that says all of light to rein in these expenses. if i can come to agreement with the other side of will tell you what they are. no. that is not leadership. [cheers and applause] i set some very specific things. i said you have to contribute more to pensions.

we're not going to pay coal as any longer until your funds reach eighties thermos solvency. we will make sure that only full time people get into the system. on the health insurance side, when i came into office many were paying nothing for their health insurance. the drop in to every collective bargaining agreement from the school board all the way of to the state vessel. i make people unhappy. i honor them for what they do. i went to the firefighters' convention after our proposal.

i went to new jersey. about four dozen firefighters were at in room. nots just say that i did get their reception gave me tonight. they continued to boo. when they saw me they really started dbooing. i said you can do better than that. and they did. do not skip ahead to the next jury. [laughter] you're killing me. this is in essence what i said. i said i understand your scared. i understand you're angry. i understand you feel betrayed. for 20 years, governments have

been coming to this convention telling you they will be the more than a band and a bigger pension and do not have to pay for it. every year they voted for increase benefits. they never gave you money. now you sit here and agree -- angry and scared. i understand why. why are you booing the first guy who told you the truth is that there's no political upside for me doing that. [applause] 19 i told them you may hate me now and you may vote me out, but if we do what i'm saying we should do 10 years from now, you will be looking for my address to send me a thank you notes. you will be collecting a pension. that is what we need to do on the federal level. we need to tell people the

truth. medicare, medicaid, and social security are eating away at every dollar we raise and in taxation. we need to get to a common sense approach to reduce the benefits, to test some of this stuff and to get people who do not need it to stop taking it so we can give it to the people at an affordable price to people who do need it. that is common sense. i am no genius, clearly. why can we do that? every time someone says it, every time someone goes near it, it gets vilified. they read the polls. they say, ok. real leaders to not read polls. they change polls. [cheers and applause]

>> i've been there for 2.5 years. you make is so proud to be from new jersey and be americans. and my italian mother told me to tell you they have to run for president. >> and led to press my luck and respond to that. press my lucko and respond to that. if you're italian mother wanted to run for president, what redoing in california? come home.

what are you doing? i have a plane. you can come back if you want. we will take you home. >> get team more taxpayers one at a time. >> i have been listening to your very powerful and eloquent speeches. aquino had to tell the american people what they need to hear. i say this from the bottom of my heart from my grandchildren who are at home, i know new jersey needs you. i really implore you -- i really do, this is not funny reject we urnnot wait another fo u years.

i implore you as a citizen of this country to please reconsider -- do not even say anything tonight. of course you would not. go home and think about it. [laughter] do for my daughter and grandchildren. we need you. your country needs you. >> let me just say this.

there are a lot of people who have asked me about this over the course of the last number of weeks and months. that is all i will say about this tonight, i hear exactly what you are saying. i feel the passion with which you say it. it touches me. i can tell you. i'm just a kid from new jersey who feels like i'm the luckiest guy in the world to have the opportunity that i have to be the governor of my state. people say to me all the time now -- and folks like you say those kind of things for as many months as it is being said -- why don't they to leave you alone? your party given your answer. isn't is a burden? what i say to you and everyone was nice enough is that it is not a burden.

anyone who has an ego large enough to say please stop asking me to be leader of the free world -- [laughter] it is such a burden. if you could please just stop. what kind of crazy ego maniac would you have to be to say "just please stop." it is extraordinarily flattering. by the same token, that heartfelt messages you gave me is also not a reason for me to do it. that reason has to reside inside me. i know, without ever having met president reagan, he must've felt that he was called to that moment to leader country.

my answer -- to lead our country. i thank you for what you are saying. i am listening to every word of it and feeling it, too. please do not ever think for a second that i feel like i am important enough that somehow, what you are saying is a problem for me. it is a great honor. this country is a great place because the folks like you. thank you very much. [applause] >> thank you so much, governor. on that night, if i could ask everyone to remain in their seats. governor, we cannot thank you enough for gracing us with your presence. [applause]

[captioning performed by national captioning institute] [captions copyrigh [captions copyright national cable satellite corp. 2011] >> james chessen, chief economist at of the u.s. bankers association, talks about the u.s. and global economy. and in speeches at the u.n. general assembly, chromium and's foreign minister, followed by a foreign minister of pakistan. united nations security council meets tomorrow morning to consider the palestinian request for statehood and full membership in the land. a number of countries have

expressed their support for the measure carried off for more vote is not expected for several weeks. the u.s. has said it will veto the request. all live coverage at 9:30 a.m. eastern on c-span to. last weekend, vladimir putin said that he would run for the russian presidency after the current president announced he would not seek reelection. later in the day here on c- span, followed give what the move means for u.s.-russia relations. live coverage gets started at 12:20 p.m. eastern at the center for the national interest. >> to chief economist for the american bankers association, james chessen, said earlier that the u.s. economy is stronger than in 2008 but still faces problems. he discusses the global economy and how what is happening in europe could affect the u.s. recovered his remarks about 50 minutes.

>> thank you very much, paul. can everybody hear me? it is a pleasure to be back here when paul and valerie asked me to come once again. i did not think i had anything to say. but apparently, we do. you will notice the theme of the talk today is actually a song by green day. how many people know green day as a group? i am really stunned. you must have kids that are teenagers or young adults here. these are some lyrics out of that. we were really struggling and britney came up with the title. we were trying to think about the dean's and britney and ryan and morgan and others put these wonderful and slides together. this sort of captures the teams --feelings that we had. think back three years ago and

lehman brothers failed. two years ago, we at the peak of -- we hit the peak of unemployment in september. we tried to think about bad things that happen last september and we just did not find any. i'm sure there were some. and now we are back in the mess. and the other thing that always happens in september is the imf always meets -- and with their big planning meeting, of course, we know what the outcome of that has been in the last several years. and of course, we have our congress that continues to create problems and after the latest round of the fights in shutting down the government, let's just all go to sleep. perhaps in october since the continuing resolution is going to kick again. here are the key themes that i want to talk about today. the first is, it is not 2008. although, it feels that way. second, if your time frame is one or two years, you are way too short. we have talked a bit about that. i do have some of my favorite

slides and i would like to update you where we are with that. the third one is, it is a small world. meaning, everything we do in the u.s. is affected by what happens in the rest of the world, and we cannot escape that. we will talk a bit about the sovereign debt crisis and greece. and the last is, self-inflicted head wounds. we manage to do this all the time. let's jump in. it is not 2008. it feels that way. i understand. in washington, it does not feel that bad, but i know that most of you are not from washington and i know you feel the impact in other parts of the world.  oddly, if you have been to a mall lately it does not feel like a recession. many are commenting that if people spend, it makes them feel better. this is the measure of market volatility. you can see what happened.

i have a laser pointer, which is always exciting, as you know. do any of you have cats? laser pointers are the greatest things on earth, right? [laughter] it is a reason to get a cat, frankly. [laughter] anyway, this is what happened we have the crisis. there is still a lot of volatility in the markets. it is still a big problem. but it is not rising to the level that we saw before. there is volatility in the markets, but risk spread remains very low. and we have shown you some of the events that occurred before. in contrast to before, we're almost at abnormally low levels. but even the debate that we had over the deficit, i did not create risk spread. that is a good sign. there are still liquidity

issues. we can talk about that. but the markets are not in the state they were three years ago. consumers are adjusting to -- this is a cole porter song, as you know. it is really one of my favorite lyrics and it kind of sums up all the things that were going on with consumers spending with great abandon. i want to tell you a story. you probably do not know that there is a self storage association. and you should, because they have the greatest fact sheet on earth. one of the things that happened, of course, was that people were spending a huge amount of money and they had to do something with that money. let me give you a sense of how much they were spending. between 2003 and 2007, cash out refinancing -- of the cash out

part was $870 billion. if you add the cash out and home-equity lines for refinancing in that five-year time frame, $1.3 trillion. a huge amount of money was pulled out of inflated house prices. and done what? put into things that people now have to store. [laughter] right? there is 2.2 billion square feet of storage space. washington, d.c. is about 10 square miles. that is the equivalent of 78 square miles of covered, self storage space. i want to ask how many of you

have self storage. you know who you are. [laughter] you wonder each month why you are writing that check. brian and i were talking about this. he told me a story about a friend who is destroying things -- who is storing furniture for marriage and paying $200 per month for that. i said, wow, that is a lot. and he said, i gather, and she does not even have a boyfriend yet. that is an extreme. $200 a month for furniture once you are married. consumers have to adjust. we had a huge amount of spending. and they have started that adjustment. this is a financial obligation

ratio with the fed. it is the old debt service ratio. you will notice by the trends that is down to what it was back in 1994. some of that is the interest rates are low. that helps on the debt service interest repayments. but there has been a conscious effort to bring debt ratio down. some of that is with lenders because of his credit. you can also see the personal income growth is rising. in 6 consequence of the recession here. -- you can see what the consequence of the recession has been here. in contrast with what the growth in personal income has been over the big expansion period. personal income growth is growing. it has made up the losses incurred in the recession. it is not enormous, but it is certainly positive. we tend to forget that when we we get all of the bad news.

look at household net worth. this is financial and real property. you can see a huge decline. trillions and trillions of dollars in decline, that is the green bars there. it has slowed down some because of the stock market. the first net worth increase was the inflated values of home prices, which were not sustainable. they were artificial. the other thing that happened was that savings rates have been much higher as a consequence. and just to put that in perspective, this drop, even if you assume it is less, still requires a savings rate of about 10% to make up for the losses in wealth that occurred. even though the savings rates are up around 6%, they should still be higher to make up for a loss of that wealth that

happen. but the good news is, net worth is recovering. it is a slow process. consumers are saving more. they are borrowing less. they are making the effort to get their balance sheets back in order. that is an important change that is occurring. it is a slow change, of course. businesses are doing better as well. one of the most interesting charts is this one, corporate cash levels. you can see it is up around $1 trillion in corporate cash. if you add other liquid assets, money market funds, mutual funds that businesses hold, you are up around $2 trillion. businesses are sitting on a lot of cash now. it is that uncertainty that exists that they are not willing to deploy the cash now. that is the biggest concern now. there is a huge amount of uncertainty. it is freezing business

decisions. it is putting all of this cash vitally on the sidelines. but the point is, businesses are doing the right things to prepare themselves as things turn around and uncertainty disappears. banks, too, are improving, as hopefully you are all aware. this is the level of capital. the level of their for the industry, the capital to assets ratio is highest it has been in years. all of the assets, total risk- based, they're all at record levels in the united states since we have been collecting this info. very strong improvements, and sometimes we forget all the things that have happened. there are still challenges, and this is the asset quality is side. you can see charge-offs are

nonperforming. they are still high relative to historic trends. but look at the trends now, very sharply downward here in the changes of that. in fact, we have had many quarters over the year in improvement in the non-current loans. we are past the home. -- past the hump. it still struggles for many institutions, but capital is at record high and assets are improving. same thing with the profitability of banks. you can see the profitability is at a low for a number of the institutions that were profitable. the recovery has been slow. we are now getting back to historical standards with a high percentage of the industry being profitable. the banking industry is certainly improving and that is very good news for the u.s. and the u.s. economy. this is jobs.

that picture, while we know it is still struggling, it is certainly better than the job losses that were experienced in the recession. you can just see that visually. it is just a stunning chart when you look at the magnitude of those losses. 8.5 million jobs were lost during that time. and you can see, there are still struggles. it look at the pattern before the big crisis. not too far out of line with that. but again, it is not 2008. we haven't moved through all lot of that. -- we have moved through all lot of that. you always hear about high prices and liquidity. but another good news piece is that we are back in a better equilibrium. is it enough to get the economy going?

not so much. you need to hundred jobs on average -- 200 jobs on average per month and about a 4% gdp to get the economy on a trajectory that moves us back to normal levels in five or six years. and i will show you that, but think of that magnitude. whenever you think of new job figures, if they are short of 200,000 jobs created, we are not moving fast enough to significantly reduce unemployment. i will have a chart on that in a moment. here's a look at payroll. let's back up for a second. if you look over here, we will break that down for you just over the course of the last year. the thing to recognize here is what is happening on the private sector verses the public sector. the interesting thing that is obvious from this chart is that

you see that the private sector has been adding jobs for 18 months straight. it is not a huge increase. it is not the kind of thing that grabs headlines, but it has been a fairly consistent pattern. of course, things have slowed down. and this month, the latest month, was at zero. but that was not because the private sector was not adding jobs. look up what is happening on the public sector side. they have been reducing jobs. that has been a drag. we could have more private sector jobs, of course. the drag is coming from the public sector, both on the federal level and certainly on the state and local level. again, the point is, it is not what it was before. it is not great, but let's not relive 2008.

the time line is five or six years. that is the key message i want to leave you with. and it goes back to my chart. this is the unemployment rate. i think i showed you this before where these are the trends in the previous recessions and all we have done is a straight line that out in the peak of that with others. this is a glass-is-half-full chart. and we are not generating enough jobs to really get down to that 2017 level. we picked an artificial 5% there. what is really disturbing, though, is that we have had some of our economists on some of our guys 3 committee who are not even convinced that the 9.1 is going to hold. paul is one of the outsiders who says, i do not believe any of this stuff.

he has the unemployment rate next year at 9.5%. he is not confident we will follow any of this path. and again, it takes 200,000 jobs, on average, each month, and a strong gdp to drive that rate down. we are not there yet, and i will show you some things to convince you. how did it start is another -- housing starts is another enormous issue. this is another of my favorite charts. you can visually see the contrast here with other recessions across the same time frame. you can see how sharply other recessions redounded. -- rebounded. housing is such an important part of the u.s. economy. look at what is happening. we are barely treading water. this is the average rate across

that time frame, 1.5 million housing starts. typically, the 1.5 million is in enough to handle the increase in population, the structural rebuilding of houses that have deteriorated. we are nowhere close to that at all. and the obvious reason, of course, is we have a huge overhang of existing properties that are outstanding. there is no reason to build new houses. the other thing that is disturbing -- now, the housing starts include multifamily and single. you have to keep that in mind. but you may have noticed this week that new home sales were at $295,000. we are producing -- and this includes multi family -- we are producing at $571,000 -- we are producing at 571,000 and is

still low because we have a huge overhang of existing houses. million there's 1.7 houses in that shadow inventory, the ones in the process of being sold. whether they are in the process of foreclosure or serious the linwood. -- more serious delinquent. there are one in 10 properties that are nonperforming. it is still a huge overhang and that alone will take three months to wind down the current sales rates. -- 30 months to wind down the current sales rate. the shuttle inventories lower than it was a year ago. that is a good thing. it is down about 18%, in fact. but we still have this enormous overhang, this pipeline of houses that are in the process of being sold. babel be a drag on this economy. that will be a drag on this economy. if your time on this one or two years, you will be short.

you could look at this picture a year ago and there would be no difference because we have not made any significant improvement on this. all of this if you wrap all of this up, is what one economist coined as a confidence recession. there is no confidence, and you can see that particularly on the consumer side. consumers are really depressed. businesses are kind of hanging in there. they are wondering what is going on and they are building their balance sheet, so it is not quite as bad. but it is a recession based on a lack of confidence that we have in this country. the next game is "its a small world."

and i know some of youre singing the song, as painful it is for you. [laughter] but it did kind of capture what is happening around the world. and the first thing is, looking at a comparison of what the other countries around the world are doing. one positive thing when you look at the united states and say, what state is still in a recession, the only state that is still in a recession is nevada. which is interesting. a couple of years ago, every state was in recession. but in the united states you think more globally. what is the nation's gdp? we know that some states to perform better than other states. you have movements -- you have movement of population and all

kinds of things balance that out. take the view that we often have of the united states and blow it up to the world and ask yourself, is 4% world gdp all that bad? and you might say, well, no, it is not, really. there are parts of the world that are doing better than others, and that is what happens in economies and resources flow to those places that are doing better. the interesting thing is, the emerging countries, the developing countries used to be at about 24% investment. they are now up to 40% or more investment. money is flowing to the places where big changes are taking place. look at the strong growth. these are the bric's. and they are not even too great for 2012, but look at the strong performance in these

countries. and others worry about those economies, but those countries are driving resources. china is absorbing half of the cement in the world. almost half of the final hour and steel produced in the world. -- iron ore and steel produced in the world. it is the biggest purchaser of aluminum and copper and other materials that often get exported back to us. and this is great, china consumed half of the pigs consumed in the world, and one- third of the eggs produced in the world. it is a very quickly growing economy that is sucking, a lot of the resources and is not far behind india and other countries. with all of the problems in europe, it is still projected to be doing better than the u.s. we should be careful not to be too critical. japan is still struggling, and they had that tsunami and other problems that have added to that.

for the u.s., let's look at some of the risks for some of the things that make things work. and we have looked at this with our advisory committee about what would make the u.s. economy go slower. they were doing this back in january before we met with the federal reserve. look at all these things. decline in equity values, yes. weaker external demand, yes, because those countries are slowing down. downturn in business confidence, oil prices, just go down that list. it is everything that could happen drive the economy's slower has happened this year. we had some momentum coming into 2011. the tsunami and other shops slow that down. and we have a self-inflicted head wounds, which we have not talked about yet. these are all pressures that are

keeping things slow. one of the things in thinking about china, and what of the things that struck me is that we're always looking at tons of data and charts. this is commodity prices and indexes that start at the same level in 2003. you get a sense of how quickly they are growing, and growing relative to one another. look at all the changes that are occurring. you have doubling and tripling. the whole index, if you take that all together, is doubled or tripled with all of those things. think about what that means for the u.s. economy. we have had a strong increase in all of these commodity prices. it is because of these developing countries of or been a lot of these increases in demand. what does that mean in the u.s.? here's what happens to the price of a gallon of gasoline. it is back toward levels that we have seen.

and to put this in perspective for the u.s. economy, a 1 cent increase in gasoline is $1 billion worth of added expenses. it is a huge impact on what happens with the u.s. economy. whether you get high ones or low ones, you know do free up a lot of money when gas prices fall. we are back up absorbing a lot of spending that consumers would otherwise have. let's talk a little bit about what is happening in europe and the debt. this is a bit more complicated slide. we always try to keep it simple, but we are trying to show you is the different countries and focus, really, on this light blue line all the way across. that is the 2010 increase in

debt that has occurred in every case. debt has been rising across europe and in the u.s. no surprise. the only country, you may notice, where that line is down is sweden. good things, of course, often happen in sweden, i am sure. but sweden, 10 years ago, put in place changes to bring their debt levels back in place. i had the pleasure of listening to one of there of their elected officials at aei. and he said the thing in sweden is, we know what to do to get elected as a politician. if we just did not know what to do when we do it. -- we do not know how to get reelected when we do it. what they learned is that if they do the right thing, they

did in fact get reelected. they took the hard decisions, cut back, and of all the countries that are out there, they have the best fiscal position among all the countries that you see there. they took the hard things fast. we will come back to some of the factors that build upon that and what makes a credible plan, and some is based on the sweden experience. but we believe that for a little bit. this is a measure of portugal, ireland, greece. italy would also be in there, and is often added as a second "i" in there. you can see their relative risk here of what happens. the problem is that we continue to let this thing continue to grow. greece is way up here. to-year greek bonds are trading at 70%. that is the interest rate. 70% interest rate, which has

got to frighten you on this. the one thing we were looking at is that there was an agreement on july 21 to try to move and reduce some of the debt, help fill holes in the stabilization fund that they had. and that would involve a 20% reduction in the outstanding debt. it was called a debt swap. and it had a tiny affect that this little downturn may have been responsible for that. but in the meantime, reece's debt because the economy is a week is almost up to 20% of gdp. -- 200% of gdp. it is almost at depression levels. it is also true of ireland and portugal. what i am told is that portugal and ireland have at least implemented systems that seem to be credible and seem to be

working because they have the political will to do that. there does not seem to be the political will increase. -- in greece. the situation has gotten worse as debt has built up. there are losses there that have to be written down. again, july 21, that 20% haircut on those losses, that has not been adopted by any of the 17 countries. there are some people saying that the losses really -- you know, the reduction, the year cut on that should be 50% now. but the key thing is, there are losses that have to be recognized and we have not recognize them yet. you've got to get to levels down to sustainable levels and the issue is, someone has to pay for that. a 20% reduction would be severe, particularly to greek banks and others. that may be doable.

a 50% hair cut, then you have solvency and capital problems with capital at all the major banks. this is the chart that i asked morgan on my staff to put together because when the united states got downgraded, we said promote weight, what is happening with the defaults and risk? and we still have the lowest credit rating of all of the other countries. this is for my own amusement. it was driving me crazy. it really bugs me that the s&p did that because it was not recognizing the overall strength of the u.s. specifically, one of the questions that we were trying to answer, which may have been of interest to you, is what the direct exposure is on on

greece's debt. we looked at the sovereign debt, which is in yellow, but we also looked at the bank and private debt. if bad things happen in greece, what does that mean for the rest of the country? you can see what the political issues are. france and germany obviously have big exposures to greece. they're worried about that and it gives them incentives to do things. look at the u.s., and it is a very low levels, particularly to the sovereign debt. even if you add up the private and bank sector debt, it is low exposure compared to the europeans. if you look at this as a share of gdp, you can see that the u.s. is very low.

the direct consequence from greek debt to the u.s. is small. and even on the interbank transactions, that is declining as banks are positioning themselves to deal with the counterparty risk. lowe direct exposure to greece. what is a good relative measure to capture the direct exposure to greece, both the public with the banks and on the private side. we compared the industry in 2010 -- sort of, stunningly, i guess -- charged off over $200 billion. that was a shocking year, of course. this year, it looks like it's going to be about $140 billion. still a lot of losses and the banking industry is working through that. the exposure to greece is tiny compared to what is relative to what the industry has charged off in the past. look at the gap between the two.

there's plenty of capacity, assuming there is the capacity to be able to charge this off. the banking industry's direct exposure to greece is very small, very manageable, not really an issue. the exposure changes, though, as we look to what happened with other countries and other countries exposure. we have greece along the bottom here. and then we have the exposure for other countries, and you can see france and germany again, very large exposures, particularly when you hear talks of italy. there are big issues for those countries, particularly spain. there are derivative the facts

as they move through the system. -- to riveted effects as they move through the system. exposure is more on the indirect nature of what happened. this was at a recent imf report that just talks about if you narrow down the greek diet. -- the greek debt. well, that is one thing. but then you get this exposure that spread across europe as you include all of the exposures, the counterparty exposures between them. the imf's conclusion is you have about 200 billion euro exposure just in the name countries at risk. and it is 300 billion euro if you spread that out across the high risk countries across europe. it gives you a feel for the magnitude. it is not small. and it has implications for the u.s. because 20% of our exports go to europe. if there is a problem created in europe, it directly affects u.s.

exports. and i will remind you, u.s. exports have been a shining star throughout the recession that have kept gdp moving forward. that has been a huge benefit to the u.s. and think about exports across the rest of the country and the rest of the world, including china and india. the point is, this has an impact because of the secondary effects that occur, not necessarily the direct effects. self-inflicted head wounds. there is a picture of our congress. they continue to do this. winston churchill reportedly said something like this and i've been unable to confirm it, but i like it. so i will say it. [laughter] winston churchill reportedly said, "americans can always be counted on to do the right thing after exhausting all other options." [laughter] and that seems to be our congress, right?

we lived through the biggest self-inflicted head wound, which was the debt ceiling debate. we're going to the continuing resolution. god help us when the super committee comes up. it is just a horrible situation. in my opinion, and i think this is shared more broadly, again, it is back to the confidence recession. we have no confidence that our government can take the steps to do the right things to get us back on track. they have done these last- minute uncertainty in the markets. i do not know how i'm doing with time. we will talk a little bit about what this means. i think it shows you something like the federal deficit last year. i may not have done this, but i think i asked you all to get out your checkbooks -- did i ask you to do this? and write a check for $4,000 for you and every person in your family.

how many of you did that? a show of hands. and you wonder why we have a problem. just to put a fine point on that, it takes about $4,000 per person in this country to eliminate that debt for one year. you have obviously not stepped up and met your obligations. this is cbo's baseline estimates of what they think is a reasonable assumption of the government does certain things. this includes things like continuing the tax breaks for everybody except those -- couples over $250,000, individuals over $200,000. it also includes the act fakes -- amt fix and the fix on

medicare. this is not very good at all. and it includes others, like the concorde resolution, who believe it will not be -- and it does not include others, like the concorde resolution, who believe the deficit could be as much as $2 trillion at the end of this time frame. this is just their baseline of what might happen. we want to contrast this between what the administration has proposed to give you a sense of the impact of what is being proposed. here is the obama jobs plan. you can see where it is front loaded. you know, you need spending. you have small tax cuts for small businesses. that is extended not only for individuals, but businesses as an incentive to hire. that is a big portion of that. we're continuing long-term unemployment relief, which we

could probably debate about. and tax breaks for families as a payroll deduction. some of these, like the tax breaks, are a continuation of what we had. it is probably not a bad thing if you think that without that, we have a contraction in spending. it will have the impact of increasing taxes. and at the end of the day, some things are paid back as it goes on. here is the obama deficit plan. you can see the components. you get savings if you change things. you get savings every year and it continues to compound. you can see the different elements of what is involved. the tax revenue comes from redefining things. some of the war spending was built in. let's combine these two things. to give you a feel of the jobs plan and the deficit-reduction.

because they have to work together if you are going to do a stimulus to try to keep the economy going. it is an interesting pattern. look at the deficit reduction under the plan for 2012. it is tiny. it gets back to whether we are taking action quickly enough to encourage investors are run the world to put capital in the u.s. all of these are back loaded things. remember, congress can do anything they want at any point in time, so this does not lock them into these changes. if you wrap all of that together, you get this blue line here. it improves the picture. notice how the deficit gets worse because you are doing all that spending to begin with. then you get the savings as it

starts to kick in and then things go back on track. again, look at the position at the end. you are still adding to the overall debt. you have not totally change that curve. understand what that means. to give you a better sense of the context, this is what omb's baseline adds up to a cross that time frame, 2012-2021. this is what the president has proposed. it does not come close to closing the gap that has been created. and this is what the super committee has to come up with, otherwise, you get the sequestration of spending cuts. as good as those savings are, it still does not change the fact that the debt is rising.

the issue is dealing with the entitlements. what we have done is you can see the path of the entitlements. this is the cbo's alternative scenario. there is the general assumption that revenue, if you even take it back in history, does not change back even with tax rates. it stays fairly consistent at about 18%. it is hard to influence tax revenue. if you go to an implication of the tax system, maybe you can improve some of that. i think that is a good idea. but look at this right here at about 2024. if revenue stays about the same there, we would only have enough money to pay for social security and medicare on the interest on our debt.

we would have no other money left over for any other spending -- defense, social programs, things like that. no money left over. if you have got to deal with medicare and social security. social security is not growing very quickly. that is one of the easier ones to deal with, particularly if you deal with that and say that it only applies to people under 40, or some level like that. here is the issue with the social security. look at the workers and the beneficiaries. the path is that we have less than -- what is it now? almost less than two people working for every retired person out there. you have got to deal with it, and with medicare and medicaid. to just kind of conclude this and then we will tie things up in a bow in a second, the states also have an issue. this is the state cumulative

budget deficit. there are two interesting things to think about. if you look at the total bars, the state deficits are closing and they are doing a better job of closing that deficit. that is a good thing. but the yellow component here is the part that was filled by the stimulus package. you can see the stimulus package is going away. that is why in the president's proposal, he got more money back to states because the burden, the red burden, even though the total deficit is declining, the portion that has to be handled by the state alone is bigger than it was in previous years because you do not have that federal contribution. all lot of pressure back on states to close that gap, a lot of the states is spending for --

in the obama plan -- teachers, police, first responders, that sort of thing. that is an issue that he is trying to address. these are just some high-level principles. we have given us a lot of thought. and my own personal thoughts. you have to have a you have to have a investors if you like you're dealing with this problem. i would be in favor of more upfront things produce up to address it comprehensively, which means medicare, medicaid, social security on the table. you have to talk about tax simplification and reform. you have to change the structure of that.

you can preserve spending that does the right things you want, the infrastructure spending. the original stimulus is that it did not have much money for infrastructure spending. those are investments in things that make a difference. we are having the same argument today. when they say infrastructure spending, the response is, there are no shovel-ready programs. that is the high-level principles that i thought of. we have some things that i hope that you are looking at.

one is the dodd-frank tracker. every day, we produced the banks in the economy so we are updating things, including the things that happened today. there was a lot of economic news coming out today. i do not know if i have totally exhausted my time. i'm certainly happy to entertain your comments and questions. i do have this effect of stunning audiences into silence. i have done that once again. >> [inaudible] >> the question was, when will congress wake up and do the right thing? there was an interesting comment recently.

i was at the international institute of finance weekend -- meeting this past weekend. you have to get the pain threshold high enough for congress to take action. it obviously is not there. one of the interesting things -- the turkish finance minister was there. they have taken a lot of steps to do things. they have put in place a 6.5% surplus targets and his comment was, if you would ask anybody on the street, what is the target for the surplus, they knew it. they would have 6.5%. if you walk out on the street in washington, no one knows. having a consistent message that everybody understands. i do not have a lot of faith that the super committee is going to come up with something great. i wish they would, it gives them an opportunity to back out of

all of the politics. the past history is everything goes down to the brinksmanship. i do not have a lot of confidence. everything is being pushed to be a debate after the election. i think we will struggle through, most likely we will get the sequestration result. i may be surprised by that. it does not come into effect until after the election. then we will deal with it. it is still partisan politics. i do not think congress believes that it is an issue that they have to come together. and i do not believe the general public believes there is an issue that really is worth coming together. some of the advice is, getting

the media to focus on that, you have to make a convincing argument that people are going to totally lose something you are going to lose this unless we take some change, and then you change the public sentiment. i do not have a lot of great hope that we will do anything over the next year. we know what the right thing to do is, but we do not know how to get reelected. i think that is the attitude. >> [inaudible] >> what is the likelihood of another credit downgrade by one of the agencies? you know, that is a possibility. i was disappointed that s&p did it, partly because they did it because of the lack of political will. i understand that. when he made a $2 trillion

mistake, it still a little odd. when you do a downgrade, the banks also get downgraded. we're starting to see that in the the united states and europe. there are implications. >> [inaudible]

what are the odds that we will slip back into another recession? >> a few months ago, i had the odds being better than 30%. i think the odds have gone up to about 50% right now. it is sort of a tossup. we are in a painfully slow growth period. there will be growth, i think it will feel like it is a recession. it is not 2008, but it feels that way. if you do not have enough momentum, you end up stalling and declining. that is where the fear is coming in. to me, it is all about uncertainty. coming back to some of the things that i described, banks are better, businesses are stronger. consumers are doing better in this country. there is a right kind of base for that. there's plenty of money to be lent, there is to stop a desire to borrow the money.

there is uncertainty about what the prospects are. most businesses and individuals are now worried about what is my tax burden going to be? what am i going to do as a business? are there more regulations? what are my health care costs going to be? i am not want to do anything because i do not have the certainty that things will change. probably 50-50 now that we would get that. it is going to be an ever so slow increase. maybe it is not a technical recession, but it is going to feel painful. it is a pleasure to be back here. [applause] >> on tomorrows "washington journal," a conversation on the health of u.s. cities. thomas friedman, they take your calls. after that, at a look at the railroad industry.

"washington journal," each morning at 7:00. later in the morning, michele bachmann will be at liberty university in lynchburg, virginia. we will have her remarks live here on c-span. >> he found several labor unions his remarks at the un general assembly. he asked them all to move toward a traditional government and put an end to the violence.

>> your excellencies, may godspeed and blessings be upon you. allow me to congratulate our assembly. i'm fully confident that given his renowned experience and wisdom, he will ably conduct the business of his position. i wish him every success in his endeavors. i wish to express thanks for his constructive efforts in presiding over the 65th session of the general assembly. our thanks also go to mr. ban ki-moon on his reelection as secretary-general of the united nations.

we express thanks and appreciation to him, and the general secretariat staff for their efforts over the past year. in particular, his following up of the situation in our country. excellencies, ladies and gentlemen, we wish to congratulate the people of south sudan on the assumption of their place in the . united nations. we wish to congratulate the transitional council in libya. my country has been witnessing since last january a huge political crisis. the political opposition that has been one of the main components of our system since

the establishment of a state of unity in yemen in may 1990. it decided to relinquish and rejected the principle of consensus. refusing to implement the agreement that we have had since 2006. following its failure in the elections. these parties -- they will not allow them to seize power. therefore there has been violence which threatens the outbreak of civil war and devastating conflicts in yemen.

that may undermine all the achievements made by our yemeni people in our modern era. as well as a struggle to have a democratic political system and the protection of its national identity, social fabric, and its unique human fabric -- and a system that we have.

at the beginning of the 1990's, the national movement in yemen accomplish a great achievement. it established a unified state in yemen. pluralistic, democratic foundations coupled with several institutions promoting human rights. however, those who made narrow, individual, and partisans interest prevail did not approve historic achievements. therefore they started commotions. in addition to the challenges of development, the unbridled

of human resources, the drought, the main sources of income -- all of these factors have made it impossible to find employment for thousands of university graduates. however, all of the national powers and all the opposition power is use this tidal wave of change being witnessed by arab countries in order to prevent yemen to achieve the democratic thing through elections. however we have listened to the demands of youth. we started a dialogue with them in order to respond to their requests. we have created tens of

thousands of jobs in order to aid employment. however the opposition party is abused and misused the youth in order to seize power. some of their elements use subversive actions to sabotage the movement of the youth. in the the project is the democratic elections and conducted under international supervision -- it is the democratic elections conducted under international supervision and several international organizations so that these elections were fair, democratic, and transparent. our government is meeting the request of our youth.

and they want to build a better future for ourselves and prosperity. a future that is hindered by the limited resources of my country and the prominence of poverty in addition to terrorism and the global financial crisis. our governments kept calling on our development partners to provide financial and economic support in order to achieve comprehensive development in yemen that will guarantee

security, stability, and in our country. the upheaval that is taking place in yemen is a dissatisfaction of the opposition and its refusal to place in 2006, where our people entrusted the president of the republic and chose him as our president. that has led to the conflict you are witnessing nowadays it and the economic development, security, and other levels. despite the intransigence of the opposition, the president of the republic offered compromise in order to reconcile between the opposition and the government. this has led to the postponement of the parliamentary elections for two years. however, resistance to the president continues. he is assuring that he has had no intention to run for presidential elections, and he accepts the election of law. in addition to a full package of reforms.

our country has incurred heavy losses, estimated at more than $2 billion, as a result of the chaos. caused by the opposition parties, who explode oil pipes and possibly electricity lines. especially in our capital. however, the government continues to abide by the peaceful solutions and continues to call on the opposition to come to the table and start dialogue. we're confident in yemen that the division -- being witnessed will only be overcome by the return to the legality of prosecution and by the providing remedy to the shortcomings.

the government offered a new opportunity for dialogue. his excellency decided to entrust to conduct all the prosecution powers to an interstate dialogue with the signatories of the initiative, and to achieve in order to guarantee a democratic transition of power. this will lead to reconstruction in yemen without a violation of the constitution or the democratic principles.

this is why we see that yemen will provide a model for change, where all parties will be winners. and where the status of women will be enhanced as a country that opted for dialogue and the means to overcome a crisis. the president offered his return in no ambiguous terms that that he adhered to decency. and he was reaching compromise to implement it. my country continues to make every effort in order to capture al qaeda with its limited resources. what we need at the international level is a comprehensive global strategy in order to enhance our national capacities to fight extremism and terrorist ideology.

they opted for dialogue. returned. they said in no ambiguous chairman said he did hear the -- adhered to this. this is true for all parties to initiate dialogue and compromise. my can treat continues to make every effort.

despite the limited resources. what we need is a comprehensive global strategy in order to enhance our national capacity to fight extremism and terrorist iowa as did -- and ideology. the republic of yemen attaches primary importance to human rights which are the main pillars of the united nations. since the return of the unity to yemen in 1990, my country has

made great strides in this field. we have established a ministry on human rights, and yemen has been a signatory and party to many international instruments on human rights. we provide support on our implementation on these instruments. we have also provided and offered our national report within the comprehensive review to the human rights council. and we welcome the results of the review conducted by the council in new york, where we actively participated. in the political crisis, there have been many violations of human rights by all parties.

nevertheless, the government is conducting independent national investigations to bring perpetrators to justice. the government opened our doors wide open to the fact-finding mission sent by the human rights council.

in response to an invitation by our government, the fact finding mission visited yemen in july and presented its report to the council on the 19th of september. the government of yemen during the presidency of the group of 77 in china continues to actively work in order to achieve consensus and unity within the group. it led to a consensus on many issues of interest to that group. namely, the agreement on the review conference on the npt, as well as a reform of the united nations. we wish every success to the republic of argentina. we wish success to the republic of algeria who will preside over th group in the year 2012. an objective understanding of the a conflict shows the intransigents and the policies being pursued by the government

of israel to establish settlements and its rejection of the legitimate and inalienable rights of the palestinian people, and its refusal to abide by international legalities. it is the refusal also of the peace initiative. we call upon the peace sponsors, namely the united states of america, to continue its efforts in order to achieve a universal resolution of the state of palestine, allowing it to join as a member of this organization. i wish to renew my thanks to the secretary general for his efforts following the crisis in yemen, and i like to thank all the united nations agencies for their efforts. i thank you for your kind attention. >> more now from the united nations.

we will hear from the foreign minister of pakistan who discusses her country's average to support security in the region. she also talks about the monsoon rains that have caused widespread flooding in pakistan. from the un general assembly in new york, this is about 25 minutes.

ladies and gentlemen. i begin in the name of god, the most beneficent, the most merciful. i am honored to be here today, and to represent the brave and before you. as you may know, the prime minister of pakistan, syed yusuf raza gilani was due to visit new york and address this august house. unfortunately, the prime minister could not come, owing to the humanitarian disaster caused by the floods in pakistan. once again i feel privileged to be able to deliver the remarks of the prime minister to the

general assembly. i bring to you mr. president and all the nations of the world assembled here, salaam, peace, and the greetings and good wishes of the people of pakistan. we are delighted mr. president, to be able to address the general assembly under your leadership. this is an important session of the general assembly, the state of qatar is a truly deserving and able country for this occasion. the pakistani people have intimate brotherly relations with your great country, and i speak for my people in welcoming your presidential term. your election to this high office is as much a tribute to your outstanding qualities as it is to the high esteem that your country is held in the comity of nations. why are we here, mr. president? other than the allure of new york city, why have we converged at the un general assembly?

pakistan is here because it believes in multilateralism. each september we return to this great city, and this grand stage so that we can restate and reaffirm the principles and values of multilateralism. it is and has been one of the abiding central tenets of our foreign policy. very idea of the united nations. to us, this idea is simple. we can do more together than we can apart. we can solve complex problems by consensus rather than by unilateralism. multilateral cooperation can help us deal with the spectrum of global challenges, old and new, in our interdependent world. as we grow more and more dependent on each other, the space for unilateralism and uni- dimensional answers to the most difficult questions shrinks. those who are skeptical of the future of multilateralism are living in the past. the future, our collective global future, inshaallah, is bright.

it is the united nations and multilateralism that will safeguard this future. mr. president, pakistan believes in the promise of the united nations - a world free from the scourge of war, a world governed by rules and norms of civility, of decency, of good will, creating a better future for the peoples of the world, interstate conduct premised on the respect for the immutable principles of the united nations. we must ensure that our united nations is the best representation of the aspirations of our peoples.

mr. president, we must do better. there is far too much distance between these aspirations, and the sometimes dark realities of our times. we are constantly struggling with difficult choices and cycles -- expediency versus values, interests versus ideals, there is conflict, discord and death. natural and man-made calamities spread fear and destitution among millions, and often exacerbate and expose already unacceptable levels of poverty and deprivation. we face these challenges in every country. we cannot afford to face them alone. the importance of togetherness and of our faith and collective commitment to the ideals, principles and values of the united nations cannot be overstated. togetherness, or multilateralism of course, does not mean uniformity or conformity. it does not mean falling in line. instead, it means harmony, tolerance, respect for diversity and a pragmatic cognitive realization that no one system, no single prescription, no one raah, or path works for all. each society, every culture offers a raah, a path for the march of mankind.

preconceived assumptions about the superiority of one way or the other must not be allowed to contaminate the spirit of the un. pakistan's oldest spiritual traditions and most beloved poets and peers have taught us there can be no progress where the mind is divorced from the heart. faith in the united nations is a manifestation of the best rational traditions, and the most cherished traditions of idealism and believing in something. we believe in the un system. the spirit of the united nations must permeate all our endeavors. the peoples of the world await the advent of the true age of the united nations. we must reassert our promise to deliver it. mr. president, i would like to compliment our secretary general mr. ban ki-moon, for his tireless efforts in bringing to bear the vast reservoir of good will, compassion and common humanity of member states in successfully addressing a wide array of challenges. on behalf of the people of pakistan, i wish to convey our grateful thanks to the secretary general and the international community for their support and solidarity expressed so generously in the wake of devastating floods last year.

this year again, heavy monsoon rains has caused widespread flooding. millions have been affected. around 5.4 million people rendered homeless. human and economic losses as well as the pressing requirements of relief and rehabilitation obliged us to seek international assistance. we again thank you for your support and solidarity. the pakistani people continue to consistently demonstrate their immense reservoir of courage, forbearance and generosity. inshaallah, we shall overcome this misfortune through the same fortitude and resilience that our people have been blessed with. mr. president, at this session of the general assembly, pakistan is seeking election to a seat on the security council. in soliciting your support, i wish to assure you that we would discharge our responsibilities with utmost dedication to the high ideals and principles of the united nations.

pakistan attaches the highest importance to promoting the goals of peace, security and stability in the world. in our own region we have relentlessly endeavored towards creating an environment of shared prosperity and peace. a democratic, progressive and prosperous pakistan embedded in a stable, secure and prosperous region guides the framework of our foreign policy and could yield enormous benefits to not only the peoples of our region but of the world. we have reached out to our immediate neighbors with a sincere desire to join hands in bringing about durable peace and development, by a win- win approach. situated as we are on the cross roads of central, south and west asia, we realize the enormous

opportunities that ensue from pursuing with diligence the vision of common development and cooperation. i am happy to note that both pakistan and india are now engaged in a substantive dialogue process. a dialogue process that we in pakistan hope will be uninterrupted and uninterruptible. we certainly intend to make this engagement fruitful and premise it on the promise of a mutually rewarding enterprise that would enable us to optimally avail the complementarities that exist. we look forward to resolving all outstanding issues including the jammu and kashmir dispute, which is among the oldest on the agenda of the united nations and the subject of several security council resolutions. a peaceful resolution that accords fully with the aspirations of the kashmiris, is indispensable for durable stability. as is the need for safeguarding of their fundamental human rights. the reality of a nuclearized south asia, imposes on both pakistan and india, the onerous

responsibility to work together for creating mutual confidence, avoiding an arms race, and enhancing strategic stability. we look forward to moving in this direction in the dialogue process. pakistan is also firmly committed to promoting stability and peace in afghanistan. we respect and support the efforts of the government of afghanistan under the leadership of president karzai for reconciliation and peace. we strongly condemn the recent terror attacks in kabul in which many precious lives were lost. we also express our sympathy with our brothers and sisters and the leadership of afghanistan on the tragic assassination of professor burhanuddin rabbani, former president and chairman of the afghan high peace council. such cowardly attacks will never succeed in deterring our proud afghan brothers and sisters from realizing the noble goal of reconciliation and peace. pakistan fully supports an afghan-led and afghan-owned inclusive process of reconciliation and peace in

afghanistan. we want to see afghanistan as a united, independent and sovereign state. we urge all concerned to join the reconciliation process. we also call for a de- escalation and cessation of violence. the road ahead for peace in afghanistan and our region as a whole is full of challenges. the complexity of the situation and the ground dynamics need to be analyzed objectively and carefully. clarity and strategic coherence, especially among afghanistan, united states and pakistan is of utmost importance. it is for this reason that we attach importance to the work of the trilateral core group. we also attach considerable importance to the afghanistan- pakistan joint commission for peace and reconciliation.

it is only by charting a clear roadmap that we would be able to bring about necessary operational policy coordination to achieve shared goals and objectives. given the volatility of the situation, it is perhaps understandable that there is a high level of anxiety and emotions. but we must not lose sight of the goals. we must work closely and as responsible partners together in a cooperative manner and not rush to judgments or question each other's intentions. a cooperative endeavor, in full solidarity with the people of afghanistan, is the only sure way of ensuring peace, stability and prosperity in the region. pakistan is willing to do its best with the international partners and, most notably, the governments of afghanistan and the united states, to acquit itself of this high responsibility, at this defining moment in one of the most important struggles of our times. mr. president, pakistan has always upheld the realization of the inalienable rights of the palestinian people, including their right to an independent homeland with al quds al sharif as its capital. i would like to reaffirm our

principled position. president mahmoud abbas made an historic and memorable case for his people. we stand by him and the palestinian people. we stand by our brothers and sisters. and we agree -- this really is not, sustainable, anymore. we support the quest of the state of palestine for membership in the united nations. in north africa and the middle east, we have witnessed important developments. pakistan believes that the aspirations of the people must be accommodated peacefully, without external interference and in a manner consistent with the principle of sovereignty, unity and territorial integrity of states. mr. president, very few countries have been ravaged by the monster of terrorism as brutally as pakistan has. we are keenly aware about the threat terrorism poses to pakistan, to pakistan neighbors, or to the rest of the world. 30,000 innocent pakistanis have been killed-men, women and children. the ever valiant pakistani armed forces have defended pakistan,

and the rest of the world at the highest cost. our troops have laid down 6,532 shuhada, or martyrs. 19,190 of our strongest, bravest and most honor-worthy boys have suffered injuries. and it does not stop there. we have seen 3,629 of our police and paramilitary personnel embrace shahadat, or martyrdom. 10,720 of these men and women of the police and paramilitary services have been injured, since 2002. the grieving mothers, daughters, sisters and wives of these brave men and women are a constant reminder of our need to be vigilant and to fight the menace of terrorism. pakistan's most popular leader, shaheed mohatarma benazir bhutto, was assassinated in 2007. numerous politicians have lost sons and brothers and fathers at

the hands of terrorists. our streets are filled with armed police posts. we cannot enter our parks, or shopping centers, or churches or mosques without being searched and frisked. terrorists have attacked our military installations, attacked the gravesites of our spiritual elders, attacked our minorities and attacked the very idea of pakistan. if i began recounting pakistan's sacrifices and pakistan's suffering, i would keep you here till next september. we do not take terrorism lightly. we cannot. we have suffered far too much. our nation is united in its determination to eliminate the specter of terrorism from our soil, from our region and the world. it is important to enhance international cooperation to totally obliterate terrorism in all its forms and manifestations. our resolve is inspired by allama mohammed iqbal, the legendary poet-philosopher to whom pakistan owes a debt of gratitude. iqbal said -- [speaking urdu]

and i translate -- its soaring height if you have the will, there is nothing to fear from adversity" pakistan has the will. we do not fear adversity. it is pakistan's firm determination not to allow any space on its territory for militants and terrorists. at the regional plane, we must all pledge that our respective territories will not be allowed to be used against others by terrorists. the issue of organizing, financing, arming, supporting and abetting terrorist violence needs to be addressed seriously and effectively. notable success against al qaeda and its affiliates has been registered in recent years. it is well known that following the tora bora bombing and consequent dispersal of al

qaeda, it was pakistan's intelligence and security agencies that interdicted a large number of al qaeda operatives. very recently, yousuf al mauritani, the chief operative of al qaeda was arrested in a joint isi and cia operation. we must demonstrate complete unity in ranks, avoid any recrimination, build greater trust and more importantly bring about the requisite operational coordination in combating this menace. otherwise, only the terrorists will gain. eliminating terrorism is in our national interest. we believe that our success is critical to regional and global peace and security. despite our limited capacity and other constraints, we have done all we can for the sake of realizing the vision of a bright future for our people and the peoples of afghanistan and of the region. we have actively advocated and worked for closer regional economic integration.

we believe that without prioritizing development and creating win-win scenarios in terms of mutually beneficial joint ventures in connectivity, infrastructure, energy and trade, we cannot succeed in changing the picture. we need to give hope and provide a silver lining to those who have not seen peace for three generations, and have only taken mercenarism and guns as a means of livelihood. pakistan's commitment to eliminating terror and militancy is irrevocable. we believe that this warrants a

comprehensive approach not only to deal with violence but also its root causes. this requires enhancing international cooperation in multiple domains. pakistan has reached out to all countries of the world to establish mechanisms and arrangements ranging from intelligence cooperation, mutual assistance in legal and criminal matters, as well as joint operations, where required. we believe that this is a global issue and needs to be addressed effectively. mr. president, pakistan supports initiatives to strengthen the united nations. however it is important not to start anything that proves divisive or has the potential unravel the essential pillars of the un. the process of security council reforms must be worked in a manner that will reinforce the confidence of the peoples of the world in this body and enhance its credibility and effectiveness. the reforms must enjoy full consensus of the international community and accord with the fundamental principle of sovereign equality. i remain committed to the vision of pakistan's martyred leader, shaheed mohtarma benazir bhutto, who reminded us time and again that selective morality by definition is immoral, and that fundamental human values alone must guide our actions.

pakistan attaches high importance to un peacekeeping functions and is a major troop contributor to the un peacekeeping. pakistan has consistently been among the top un peacekeeping contributors for many years. we have over 10,000 troops in the un blue helmets. we also attach importance to the united nations work in the field of disarmament and non proliferation. our collective endeavors in these fields could best be effective if we could enhance security, for all, and pursue approaches that are not selective or discriminatory. normative work must be premised on principles. mr. president, we applaud the work of the united nations in multiple domains. the specialized organizations, bodies and institutions are veritable examples of accomplishing shared goals and broadening vistas of

cooperation. pakistan played a leadership role in conceiving and piloting the un's delivering as one agenda. this is a potentially vital informant to global development, and to the aid effectiveness. despite the paris declaration and its reaffirmation at accra, we have a long way to go. the one un pilot exercise in pakistan has struggled to achieve the lofty goals it set for itself, but we continue to invest hope in its eventual success. of course, the most important kind of harmonization is the one that takes place between people, between hearts and minds, between nations. we place immense importance on our ability to promote harmony and tolerance among and between societies, cultures, faiths and nations. we know the price to be paid when these values are breached, having lost the governor of our most populous province, salmaan taseer, and our valiant minister for minority affairs, shahbaz bhatti to acts of violence perpetrated by extremists. for us, the process of harmony and tolerance begins at home,

we take it very seriously. we are committed and our resolve is strong. at the international level, we are confident that un provides the best global forum, that is fully equipped to enhance understanding and good will between all members of the international community. respect for beliefs, cultures and traditions are the hallmark of civilized conduct. we are particularly concerned over campaigns that tend to stigmatize islam and muslims. islam is a religion of peace. it is important that the international community celebrate our common humanity and unity in diversity. mr. president, the systemic fault lines in the global economic landscape have surfaced lately and remain a source of immense concern. the debt and financial crises adds another worrying dimension to the existing disparity between developed and developing countries and the need to promote holistic development and economic growth. this requires re-visiting the fundamentals and readiness to equitably address the underlying issues.

mr. president, as a democratic country, committed firmly to the ideals, values, and principles of the united nations, pakistan will continue to do its best for the cause of global peace and prosperity. under the leadership of president asif ali zardari and prime minister syed yusuf raza gilani, the pakistani nation is moving ahead confident of itself and its enormous capabilities. as a vibrant democracy, we are in the process of accomplishing a historic societal transformation. the challenges our people have dealt with empower and embolden us. we will remain unflinchingly democratic. we will defeat those that seek to terrorize us. we will empower women. we will protect the weak and the vulnerable in our midst, especially minorities. we will stand up for the weak and vulnerable abroad. we will support the human rights of kashmiris. we will speak in support of the palestinians.

we will educate our children. we will protect our children. we will face any and all challenges with determination and faith. most of all, we will be a peaceful and prosperous society. there will be challenges, but inshaallah, we will overcome them. we don't anticipate doing any of these things alone. with our neighbors and our friends, we will do all this in the spirit of togetherness. in the spirit of harmony, we will forge ahead despite the darkness of our times in the spirit that helped build this great institution. that spirit, a spirit that speaks to the very heart of pakistani identity, is the spirit of the un. let us join hands and marching forward! for the good of the peoples of our countries and for the good of the world. mr. president, with your permission, i will conclude my statement with the words of pakistan's founding father qauid-e-azam mohammad ali jinnah which is the quintessential expression of pakistan's foreign policy.

mr. jinnah in a radio broadcast quote "our foreign policy is one of friendliness and goodwill towards the nations of the world. we do not cherish aggressive designs against any country or nation. we believe in the principle of honesty and fair play in national and international dealings and are prepared to make our utmost contribution to the promotion of peace and prosperity among the nations of the world. pakistan will never be found lacking in extending its material and moral support to the oppressed and suppressed peoples of the world, and in upholding the principles of the united nations charter." with this, mr. president, i thank you. [applause]

besides the united nations security -- a number of countries have expressed their support for the measure ca. the u.s. has said it will be to appear in -- later in the day, a look at what the move means for u.s. relations. >> what more invidious of the candidates. c-span's website for campaign

2012. it helps you navigate the political and landscape with facebook update from the campaign. candidates bios and the latest polling data. then links to the caucus state. >> the broadband has been a bright spot in the slow economy. will the fed job growth. this is a little more than half an hour. >> thank you very much for all of joining here to hear his speech about broadband and

innovation. i like to say thank you for allowing us to put on event here. push forward. us i'm excited about the initiative. he is the owner and founder of a washington, d.c. area business. they have seven locations. a are a great example how we can spur growth from the online world into the on-line world. thank you for those who are watching from a black cast -- webcast on television.

i like to speak about living social. the company has been around for over four years. we start every business as a small business. we have been able to grow to nearly employees worldwide. it'll really helped to drive local commerce on a global and international scale. hire continuing to go and between 150-200 employees per month. we think we have a model that will continue to grow and thrive. what we do is to help small businesses attract and retain customers. the number one problem for many small businesses, how do i get new customers.

this evolution of local commerce being fueled by innovation and broadband growth is really what it is striving for. we think that we have the capability to allow a lot spall businesses to grow in conjunction with us. i'm excited for everything will be able to do. it will provide this for a local businesses and jobs that are out there. with that, i like to introduce warren brown to talk about it.

>> good morning. thank you for having me. thank you very much. it is a presell for us. take love is my bakery founded in 2002. it has different locations. we bake on site. people come into and place orders. we get a lot of our sales online 3 online stores. we do a lot of our education. it does is to run low cost of broadband services.

it did so much time to get everything done. they have like 13 or 40 people.

. .

it gave them to them openhanded. the interest was to prevent violence. they understood that violence would not work. i guess it would continue. if things deteriorate, it could have a negative impact on the relationship between israel and the palestinian authority. >> one thing that could undermine the situation -- i agree with what prof. perry just said. is a congress cut off aid. to be a serious mistake. this is a young man going to

work, they will have other things to do. they could provoke reactions. then you could see a downward spiral. i know how strongly people on the hill fill -- feel about what the palestinians are doing in the u.n. if they were to react in a knee-jerk way, reactions to be very severe. >> in narrow situation, i would suggest the key would be the israeli reaction. what we diplomats called the shake of the table of credentials. they say colonel so and so, republic of palestine. they could rejected. it would be up to the israelis

to continue by excepting the credentials of someone who pretends to be the representative of the established date. -- established state. >> i am the advisor to apec. he said that for them to go to the icj it to be counterproductive the fed -- counterproductive. the other side is the new york times. he said they can go to the icj. >> they do not need to be a state.

the assembly also sent the legality of building a war. -- wall. we all know what has happened. 14-1 the decision was in favor of the palestinians. it undermines the determination. they do not really need that. with regards to the icc, this is a complicated matter. it is not straight forward. they have to decide on this matter. i was on the matters before.

it is intended to protect the rights of people. this is one of the purposes of that. you have one from his or her state. a person goes unpunished. it is regard to that. it takes into account. it is a matter for them to decide. thank you. >> there are very many opinions on every issue in issue. -- in israel. on some issues, there's almost anonymity. one is the anti-israel bias. you mentioned this before.

if there be a motion to be u.n., there would be 90 boats going forward. -- votes going forward. the same applies to this. i do not see it as an objective and more of the institution. there are very many cases where they felt were it had proven itself. the mayor pronunciations of this is being seen by israel. it is a hand that we will not negotiate. will you did we do we will use

it in fields where you are very -- we will use it in fields or you are very weak. >> you hear that this is the last chance for a two-stage solution. what does that mean? isn't the only alternative in the long run? what does that mean? >> it is a wonderful question. it looks into the the question of when does a state withdraw from other territories that it is occupying? it took some cases for ireland and the west bank. it is an interesting theoretical model to say when you reach the stage rican not

withdraw any more. is becoming an integral part of the metropolitan. you sure that israel would be able to withdraw. after 15 or 17 years, he believes it will be much more difficult. he has reached the stage and no return. i beg to differ. i use it for the political will. they can be achieved. we know the power we have put on the table by president clinton. they have almost agreed about the territorial issue.

the question is whether it would be to% -- 2% here or there. it is the political will. >> despite what i said about the essential revlon's historical a, -- irrelevance historically, i suggested given the question that this situation offered an opportunity for an outsider. never should a good crisis good to waste. we have missed the chance here. once the announcer situation, and the united states tabled a resolution of the security council, calling for palestinian statehood on the basis of the details of the last accord. what if a putt that resolution

on the table? >> i also see it as an opportunity. until the security council passed to vote, the opportunity is there. some said the real mistake the israelis made was when he put his proposal forward. they should have said great we support you. then they would have withdrawn it. the opportunity says in terms of, the more settlements have become cities. that is what most of them really are. there's big as american small towns. the longer it goes on the more difficult to get. a still pretty much holds a.

they're still focusing on the wrong thing. by focusing on every bit of construction, which the administration open the door for them to do, they have wondered -- rendered it impossible for netanyahu to follow up that way. but someone has a baby, they want to build a bedroom. they're creating new settlements. if they were to say we want a commitment for the top post at all, no expansion, that is a different story. the goes and verse -- a disciplined exchanges. >> this number has quadrupled.

without territorial continuity. if cassie's elements. -- it has the capabilities. it is a one state resolution. asia has to decide. they would not take more refugees in total. the number -- water we going to do? -- what are we going to do? then israel has to decide, what kind of state to we have? but what happens then? you have the number of historic

in palestine will be the same? what are you going to do? are a kind of a jewish states? four democratic state? that is the question. time is not on israel's side. >> last week they did the interviews with charlie rose. he did an interview.

he said he has maps. i assume it is the basis for the palestinians. he needs to hear a number of israel before he can do it. he said i just want to hear one sentence. it is to states for two people. is this a bluff to? is this real? of this for show? when the palestinians want this, they use this historical rate. they have to have this. did they or didn't they? >> i am not sure about this. again, they have very similar to that. i do not think it will change much.

if i delay, the negotiations will mean more. he will not be sorry to say that. you will be shooting yourself in a flood. >> anyone else? >> is regarding the whole process. you are talking about security and territory. the general understanding i have is them being included in the palestinian state.

they are into separate governments. how will that were? -- work? due to make to palestinian states or one palestinian state in no one really knows how true sovereignty? how does that work? >> that is another thing. it was taken with them at that time. this is a big problem. this is a big problem. since he took over, it is the thorniest issue.

that does not mean it cannot be negotiated. has already been created. then you worry about gaza. let's see burst of we can have some framework for an agreement that we can work on. without giving too much details, it would be not a problem if we have the frame work. >> one has to look at the negotiations already since 1980. they're starting to negotiate. fascine them to put forward their positions.

we know what they are. we were negotiating. there were close to an agreement. it is irrelevant. we know israel will give back. we know that most of the settlements remain debt to% or 3%. -- at 2% or 3%. without that there would be no agreement. i believe the politicians know the answer as well. israel will have to give up demands.

there be no capital in jerusalem. this is the position of government. beanot that, they're a government. there the security issues. israel asked to present the demands. with the changes, what is the future? in the past, they were more lenient. if there were be a change in jordan are the american influence will diminish, it is much more likely today that was 10 years ago. it still demand a permanent position. there are some other new

elements that will be discussed. the others are unknown. we're wasting our time talking about it. >> please. >> i have a question for professor carey. you say the issue is political will. the political will of the netanyahus a demonstration. i would be curious what that will is. others have said that the united states should have welcome this opportunity for the security council and not be automatically-to the palestinian situation. you think that is realistic given the issue of political will? >> i will follow you.

>> i am proposing we should use the opportunity under specific conditions. i'm not just talking about a resolution. putting forward one that encapsulates the last negotiated agreement. there were still a couple of points. they were not accepted. so what? let negotiate with the united states still holding the veto. then you forced the two parties to negotiate that little bit of difference. you would put on the question of statehood. do you guys wanted?

-- want it? negotiated. -- negotiate it. >> this is one of the most difficult questions for any israeli analyst. what does not now who feel deeply in his heart? that is because his political makeup is complicated. on one hand, he is the son of his father. all three would never give back the west bank to the palestinians to make peace. on the other hand, it is a very clever politician who understands the world reality. he understands the gap between the belief in dreams and reality. which part of his personality will be stronger depends on the political game.

this is the reason why president perry changed his position in last two years. whatever president netanyahu met with them, he said he will make peace. you will be suppressed, i am -- surprised, i am willing to compromise. other times, he said he was not willing to do so. it will not be what is in his heart but in his mind. the way he reads the situation and forces within israel -- let me give you one example. the labor party won a victory last week when the new -- with the new leader. the republican poll gave the party 22 seats. if there will be a change, it will not be a major change.

you only need three foresees to move from the right to the left. he will probably be reelected. if he has a difficult one, and no one can give you an answer. there is no answer. it depends on what is the nature of the game and the future. -- in the future. >> i know nothing nothing about netanyahu and what he is like. there are two things that have been in in israel. he is an elected leader. and both of these developments

illustrate that the primal of the universe still worse, the role of unintended consequences. the engagement and israel of the community welcomes the population. it has helped push the politics more to the right. the arrival in israel of a million russian citizens are allegedly jewish to of turned out to be soviet aggression types in terms of their political views. these have shifted and the public position here. >> do not forget the million young voters.

they gave obama and the victory. the reason is very simple. they were socialize political during the 10 years. they cannot go to the pubs to dream. there will continue to share this. when they saw him withdraw from gaza they continued. >> to this million people moved to dramatically to the right. it would be a miracle had they not done so, watching what happened in is 0.

>> we have time for one quick question and a quicker answer. right back here. >> my question is this, given that the balance in security and with the spirit of the arab spring, do you think that is it still your of this recent attempt by about this time -- by palestine to become a state e? >> it is not about the issue of failure. the council is seeking full membership, there are many other alternatives. they might eventually get it. there is a resolution were they

can go to the general assembly on this or they can be like the vatican. a member state. that might happen. i think that it depends on the israelis and palestinians and how much they tried to cooperate and try to diffuse any tension that will ensue in this regard. the security corp. has been going well. that is why there have not been any major incidents from the west bank. that is very important. basically, that is the point. that is the short answer. >> on behalf of everyone i want to thank our panel for a super, super series of presentations and responses to the questions. i will wrap it up.

i will tell you a story that has nothing to do with israel or palestine but it has to do with negotiations. when we were discussing things with the former soviet union and the warsaw pact and what led to the end of the so-called cold war, i remember we hosted the chairman of the joint chiefs of staff for the soviet union and the most influential military person in the soviet union. when he threw his weight behind mr. gorbachev, that made the difference. we were hosting him and among other things he said, he asked one of our corporals. he said, what do you think about russians being here? what do think? why do you think we're here?

the corporal looked him in the eye and said, i do not know why you're here but it sounds like a good idea. what's the corporal meant was that it is a far better to talk and negotiate then run around saying you're going to do this and do that. you will never get anywhere with the latter. you may not be successful with the former but it is worth a hell of a tribe. it is obvious this is a complex issue as we all know. i personally think that it hasted the soft through -- has to be solved through the palestinians to work. the worst thing would have third and fourth parties. thank you very much.

>> the united nations security council meets this morning to consider the palestinian statehood and full membership in the u.n. a number of countries have expressed support for the measure. a formal vote is not expected for several weeks and the u.s. has said it will veto the request. we will have live coverage and 9:30 a.m. eastern on c-span to. last weekend, appear putin said he would run. later, a look dead what the move means for u.s.-russia relations. coverage is started at 12:00 eastern from the center for the national interest.

president obama's senior campaign strategist david axelrod was in new hampshire yesterday discussing the 2012 race. his remarks are next on c-span. then, new jersey governor chris christie in california. topics on washington journal include the financial health of cities and competition in the freight rail industry. that is at 7:00 eastern. >> irregulars updates of what is on the season and networks with c-span now on twittered. . and links to help you watch. it is easy to sign up. just go to twitter.com. the latest information on what to watch now. >> later the senate passed a

resolution to form a government for one week the house is expected to clear later this week. the senate passed a measure that would fund the government through november 18 but eliminated disaster aid and energy tax. this house tilly's to vote on the measure. here is senator majority leader harry reid and other senate democrats talking to reporters. [applause] >> thank you so much. i grimace when people start reading. every year in gets longer and longer. i feel older and older. i want to thank neil and father and the entire institute family for inviting me here today. i am so impressed with this

program. i cannot think of a higher calling than to expose young people to politics, to public life, about the issues in public-service. hopefully it will spawn a new generation of leaders. we need that. places like this are a wellspring. i know some of the young people that i shook hands with this morning -- we are all going to be working for them sunday. i am sure of that. i congratulate you on your work. there you are. thank you for your long association with this event and putting it together. though he could not be here this morning, i want to send my bus to the governor and thank him for his years of the public

service as he completes his term. i am happy to be here. i understand you had a few republicans. i'm glad to integrate the festivities. i am happy to be back in new hampshire. tim tries to blunt the truth but my reporting days went back to 1976. as part of that, -- as part of that reporting, i was through new hampshire quite a bit as a young reporter covering the new hampshire primary. i remember i was assigned in 1984 to do a profile governor askew of florida when he was running for president. this is what happens when you are a young reporter. you are asked to do profiles of governor askew. he was a splendid man, but not likely to become president of the united states. i went to a high school here in manchester, and he spoke. i did reporters to end i grab a

couple of kids after. i said, what did you think? one man said, it was very impressive. i said if he would vote, would you vote for him? this kid was very offended preset, "i have not heard from all the candidates yet. " i think in these early stage -- states i have to throw iowa in. these early states are the only states were candidates come face-to-face with citizens on a regular basis. people in new hampshire take the responsibility very seriously and put these candidates through their paces. they are a test for the most difficult assignment in the world. it begins here with very good questions from citizens who take the responsibility seriously.

i know there is always a controversy about that. why should these early states have so much influence? i really think the people in new hampshire take their responsibility well. even though i do not always agree with their verdict, i respect the role that they play and how seriously they take it. one of the characteristics of new hampshire voters that i have been aware of over the years is their sense of independence. generally, they are people who are less interested in party labels and more interested in the quality of ideas, the vision, a character, and candidates who come before them. i think that is one reason president obama won new hampshire in 2008. the president's view then is the same is now.

he said then and believes now that we have to rise above wintering partisanship, rigid ideology, the effect that part of some people have too often on our nation to face the challenges we meet as a country. there is no more pressing challenge and the challenge of the economy. people in new hampshire live with that every day. i do not have to tell you how important it is. the immediate challenge of accelerating jobs and growth. particularly in light of the strong headwinds we face this year from all it around the globe that have made a recovery that much more difficult. that is what the president is fighting right now for the american jobs act which would put teachers back in the classroom, veterans back to work, construction workers back to work rebuilding our crumbling bridges, roads, and highways.

and schools. it would open the door for people who are currently receiving unemployment to get valuable on-the-job training and skills as a look for employment. it would put additional money in the pockets of 160 million americans and in the pockets of small business people who are trying to make it in this economy. but let's acknowledge that beyond this immediate crisis, there is a long-term trend that we have seen for decades that we also have to focus on. that is the hollowing out of the middle class in this country that threatens to change the character of our country and the basic assumptions that we

have about our country. for the 35 years after world war ii, incomes grew, wages grew in tandem with the economy. all books truly were lifted when the economy grew. for the last three decades or so, that has not been the case. wages have essentially flat lined for 80% or more of the american people and real terms. and, of course, prices have not. there was a census report just a couple of weeks ago. what it said is the average white male worker in this country is making in real terms what he was making in 1973. in total, the average worker is making what they were making in 1996. we know that prices have not gone a long accordingly. one example -- and i am here at

a school of higher education. the cost of college education has increased by 429% since 1985. that is just one of the things people are struggling with that are very much part of a middle- class life. whether it is health care, housing, all of these things have put enormous pressure on families who grappled with it by becoming double income families and by putting things on their credit cards, and acting out their credit cards, borrowing against the value of their home -- that was fine as long as the value of their homes was escalating. we know what happened in 2008. that whole house of cards came crumbling down. so our task is not just to rebuild our economy in the short run and create more jobs.

it is also to make sure that hard work is rewarded. that responsibility is rewarded. if you work hard, you can get a head. everybody gets a fair shake, and everybody does their fair share. we are working on two projects at once. we honestly thought what we got to washington, we would get some cooperation from folks across the aisle. after all, we were in the midst of the biggest economic crisis since the great depression. but they had a different plan. senator mcconnell, the majority leader -- the minority leader in the senate did an interview in 2010 that was really revealing. he said that we made a decision from the beginning that we were not going to give the president support of any major initiative.

to do that would be to confer a sense of bipartisanship. we did not want to do that. in the midst of this tremendous challenge, essentially, the judgment was to let the president and the democratic party grapple with that on their own. now, you can question the appropriateness of that decision, i certainly do. it was diabolically clever. what happened was, the republican party was able to force the president to take a series of very difficult decisions, many that were as necessary as they were unpopular. the recovery act, the intervention to save the auto industry, to shore up the financial industry. then they were able to go to voters in 2010 and say that we did all this on a partisan basis. he is being ideologue's rigid ideology call.

in new hampshire and elsewhere, people wanted less partisanship. it wanted more cooperation in washington. the thought if we elected a republican congress, somehow, that would force a greater sense of cooperation and washington. that is the great paradox of 2010. instead of forcing greater cooperation, what these independent voters did with the best of intentions was sweet indeed most ideologies all group of republicans in my lifetime. the consequences of that have been felt all throughout this year and culminated in the debt ceiling debacle. the same forces that are very much in control of the congress

now -- of the republican side of the congress and the majority in the house are very much a force in the republican nominating process. ec republican candidates. many of them come through here. we all saw last week in the last republican debate when a young soldier appeared on the screen from iraq to happen to be a gay american and asked a question related to that and was booed from the crowd. not one person on that platform, not one person was willing to say, "do not do that. it is inappropriate to do -- boo

somebody who is risking their life for this country and is serving honorably. do not do that." nobody did that because they feared it defined the crowd in that room. that is extended to economics as well. they have all sworn oaths of obedience to his basic constructs that we never again should ask -- not $1 more from any america, for many corporate -- corp., from anyone to help solve our problems. they have laid out a familiar prescription for america, one that we have seen very recently. that is to continue to cut taxes at the very top to maintain tax loopholes for corporations, to roll back all the wall street reforms that

promote transparency and accountability on wall street. it is the same for below we -- formula we heard 10 years ago which helped lead to this crisis. yet this is what you probably hear from this podium and he will appear in the debate in a couple of weeks when the republicans gather in new hampshire. this is an old line -- this is old line in old bottles. i believe it is ultimately not going to sell. as i said, what americans want is an economy where everybody gets a fair shake and where responsibility is broadly shared so we will meet our responsibilities -- meet the challenges that we face together. let me say, one of those

challenges absolutely is dealing with our fiscal mess. we have a budget surplus in 2001. we squandered that surplus, and now we have a fiscal crisis. it is a big dark cloud over our future. there is no doubt about that. the question is, what is the best way to go about solving that? are we going to do it in a way that is balanced? are we going to do it by cutting the things that will make our country stronger and our economy stronger in the future? you hear a lot, and you probably heard a lot in this room from people who say, we cannot mortgage the future by failing to deal with our fiscal challenges. that is absolutely right. that is why the president went to such lengths over the summer to try to reach a major

agreement that would solve this problem for decades to come. let's acknowledge there are other ways to mortgage the future. we have to be cognizant of that. if you cut education by 25%, which has been proposed on the other side, you are mortgaging the future. we know the countries that out educate us in out compete us tomorrow, and d.c. our students aren't sliding relative to students in other countries, this is a prescription for disaster. one of the candidates that i covered when i was a reporter in 1984 here in new hampshire was gary hart. he always said, if you think education is expensive, wait until you find out how much ignorance costs. that is a profound statement. i think we as a country need to

recognize that. if you cut research and development by 70% as has been proposed, you are mortgaging the future. if the government had not done the things in terms of funding research, there would be no internet. there would be no google. there would be no gps. this is how progress happens. when the government takes on basic science that corporations cannot afford to do and provide the seeds for progress. we know all around the world other countries are investing in that kind of research. we see it in china, india, and brazil. we have to compete if we are going to maintain and develop and encourage the kind of economy which good middle-class jobs are available, we have to educate our workforce and make sure we are commanding height

and jobs, it chance manufacturing jobs and other jobs that will pay the kind of salary that will allow people to live lives they want to live. if you walk away from our commitment to infrastructure, to rebuilding, the basic physical plant of our country and making sure it is competitive and that it is functional, then you are mortgaging the future. in one of the early debates, speaker newt gingrich wound himself up into a state of high dudgeon, which is not an unusual event, and said we did not need a department of railroads to build the transcontinental railroad. that is true. but what we did need was abraham lincoln in the midst of the civil war making a decision that once the war was over we better have a transcontinental railroad or we would not grow. he also made the decision to

move forward on land grant colleges. in the midst of the civil war when i think you can argue the demands on the government were greater than the ones we face today. because he had the vision, even as he was trying to save the union, to do those types of things to set up a patent system and do other things that were going to be the foundation for growth, we became who we are work. -- we became who we were. that is a lot about what this election is it out. -- is about. it is about what we do in the short term to spur jobs and growth. it is what we do in the long term to lay the foundation for the kind of economy that is one to provide real opportunity to the broadest number of americans and reverse the trends that we have seen over the last 30 years that culminated in this

collapse in 2008. i do not want to leave you with a sense that i am pollyannas about the challenges. we had the wind in her back in 2008. president obama got 53% of the vote. that means 47% of america voted against him. we do not have the winds and our backs in this election. we have the wind in our face because the american people have the wind in their faces. this will be a struggle. i firmly believe we are on the right side of the struggle. this is a tough time for our country, and is a tough time per the american people. the president will take responsibility for everything he has done, as he should. it will not be enough to simply point fingers of blame and try

to lay on him the responsibility for all of america's ls without -- ills without providing credible prescriptions for how to solve them. it will not be enough to offer back to the future proven failures. the american people want the president to point to the future and offer a plan for how to get there. through this process that you guys are so much a part of, they will evaluate all of the candidates. they will evaluate their ideas. they will evaluate their record. they will evaluate their character. then they will make a judgment about who they can count on to fight for them and the values and vision that are so essential to who we are as a country and hold out the greatest hope for the embattled middle-class. i very much look forward to that debate because i am very

confident it is one we are going to win. i know by stating that he year in history of very sophisticated room of -- in this room of very sophisticated political observers, i will be held to it. we are a better country for what you do here. as i said, i look forward to the leadership that a lot of the young people who are here this morning and who participated in this program will provide in the years to come. thank you. [applause]

>> will you take a couple of questions? >> as many as you want. >> thank you. thank you for being here. thank you for your kind words about our primary. i would like to ask you to put your political strategists had -- hat on for a minute. we have a primary early next went to trade we are not sure when yet. unlike quite a few of the states before us and several after, we allowed independence -- which is the loudest -- which is the largest group in our state. after the results are in, i would be interested to hear, and i bet a lot of students would as well, how will you and the president's campaign analyze those results? what will you take from them that you will not get from iowa and south carolina? >> it is interesting. we will look hard at that and held those independent voters

behave in this primary. obviously, there are elements of this primary that are not evident in iowa. you have people competing in this primary who are not competing in iowa. they are making explicit appeals to independent votes. we will look hard at that. we will look hard at the level of participation in that primary. most of all, what we will be looking at is the quality of the debate and exactly what assertions are made during this process. we are going to ask questions. the questions are going to be if the representations are consistent with what people have said and done before? are their ideas credible? are they simply tailored for

specific constituencies to get through the nominating process? that is really what i look forward to. i can tell you there is a lot of criticism about our nominating process. it is pretty barbaric at times, having participated in and i can tell you it is hard. there are a lot of the veterans of the process in this room. what it does do, as i said in my remarks, it tests you. it tests your ideas. tests your character. it puts your record up. i think people in new hampshire do a good job thrashing that out. i can tell you i remember in 2008, we won a big victory in iowa. several days later we came here to new hampshire for the primary. we spent five days effectively

taking victory laps around the state of new hampshire and while senator clinton campaigned very close to the ground and made a very compelling case. we lost. it was a great lesson for us. i think it will be interesting to see how these candidates -- i know there are certain assumptions about the state and how it will go. there is a home court advantage for a candid. but kantor is always a test, and i think it will be again. i cannot believe you did not get the first question as big as you are. [laughter] >> hello. i am a politician major. my name is zach greggor. with the economy clearly been the thing that is the thing to focus on, how do you feel about the amount of money that is being asked on both sides to raise in terms of campaigning? do you think that amount of

money is justified? what are your thoughts on that? >> you raise a very concerning question, and that is, what is the effect of all this money in the process? we have a new and kind of menacing dimension this year because of the citizens united ruling over the supreme court. now, third-party groups can raise unlimited amounts of money and undisclosed contributions. there was over $200 million spent in the last election in the midterm election. i expect that number is going to be between half of half a million dollars and half

a billion dollars. that has never happened before. it is going to force us to raise more money. we put restrictions on ourselves that other candidates have not placed on themselves in terms of taking money from registered federal lobbyists, in terms of taking money from pacs. i do not regret that. i think it is the right thing to do. it is an unknown question as to what the impact of all this will be. you are about to become our test cases on this. i suggest these so-called super pacs will begin to mobilize in the republican primaries. you are going to see candidates attacked from these sort of stalled the operations. -- stealthy operations. governor.

house 1,as one, governor romney has won, -- governor perry has one, governor romney has one. you guys are going to see it close up. the answer to your question is, i have been concerned about money in politics for a very long time. we have tried to come back to -- combat that to some degree by raising as much lower dollar money as we can. our contributions tend to be on the average lower. we will see when we file our reports. we had over one half million contributors as far as the last report. it is not enough. the question we all have to ask ourselves as a country is, what if anything we can do about this, especially given the supreme court ruling. what we risk is returning the in many different ways, kind of a gilded age where infrastructures can simply by a congress or even a es