economy going do is get this economy going again. and allow the american people to know that the future will be brighter for them and for their kids. we have the president right now campaigning. in north carolina today. he is campaigning for his stimulus. someone needs to tell him that the stimulus is dead, gone, and visible. the emperor has no clothes. the stimulus bill was turned down by the democrats. his own leaders in the democratic party in the senate has said -- have said, no. what he needs to do is go back to washington and sat down with democrats and republicans and work on legislation that will get america working again.

[applause] leadership is hard. reaching across the aisle with people who disagree with you on issues and finding common ground is tough. he has not been able to do those things. he likes campaigning. that is what he is doing. we did not elect him to campaign. we elected him to leave. we need that leadership. i have laid out a series of things you have to do to make sure the foundations of our economy is so strong we start creating jobs again. i described them in four major categories. it is a much longer list than that. there are things you need to do to get the american economy going again. one, you have to make sure the tax rates with our employers are competitive with other nations. hours are the highest in the world along with japan. -- ours are the highest in the

world along with japan. number two, you have to have regulations. as republicans, we cannot pretend we want to get rid of regulations. you the regulations to make the free market work. regulations need to be modern, up-to-date, and streamlined. the regulations need to occur each the economy, not kill it. our regulatory burden is killing the timing. this president has added more regulation than the former president. you have to have trade policies that open markets for american goods. when people cheat, you have to hold their feet to the fire. this is an export state. iowa exports products around the world. i want to open more markets for american goods, for iowan goods.

right now, you have a president who has been in office three years. he stalled on trade agreements with panama. it has finally made its way through congress. during these last three years, while this president has negotiated no new deals, the chinese and the europeans have put together a 40 different deals. that means they are going to have trade relationships and distribution and brand awareness that will make it harder for us. you need a president that wants to open up markets. you have to have an energy policy that gets us on the track to being energy independent. that means, you do not say no to all of these sources of energy in this country. you develop our renewable resources, wind and solar. you use all of those and you would encourage efficiency in our use of energy.

number 5, you have to have the rule of law. you have to believe the laws are going to be followed. when the president stacks' been national labor relations board with people that -- stacks the national labor relations board with people that tell companies they cannot build factories -- you cannot do that. number 6, you have to have institutions that build human capital. what do i mean by that? we are in a capitalist system. sometimes people do not like that word. i like capitalism and free enterprise. they are the only antidote to poverty the world has ever seen. even china is copying a lot of what we have done in the free enterprise world. you have to have capitalism.

not just capital for finance or resources or capital for physical goods. you also -have to have him in capital. we have to have institutions that build human capital in an exceptional way. let's think about what they are. schools. k-12. treated to schools that are in the bottom of the world -- at the bottom. you also have immigration policies that opened the door to the best and the brightest and that wellcome legal immigration and stop illegal immigration. illegal -- welcome immigration and stop illegal immigration. illegal immigration stops legal immigration. [applause]

if you are thinking about investing your life savings in america or if there was some big company were asked to run, he would not put your money in a place where you did not know if there were going to have a meltdown or a place where the dollar would not be worth anything in the future. if you have a government that spends more than it takes in, you are going to worry about the future of that country. we cannot allow our nation to spend more than we take in. we have to cap how much the federal government is going to take out our economy and we have to have a balanced budget. those are the things that are essential to getting this economy going and that our right for america. [applause] i know this is a town meeting kind of format. this is not officially a town meeting, but kind of a town hall. you will get the chance to ask questions. i know there are friends in the

audience. i see some romney stickers. sometimes those are just camouflage. there are some obamas stickers in here. there are some folks who are voting for other people. that is what is fun about this nation. i love the fact that we can disagree. let's do it respectfully. let's turn to you for any questions you might have. >> you were on governor mike huckabee's show a few weeks ago. one of the things you talked about was that you would support a life begins at conception amendment. that would mean banning most forms of birth control. 98% of american women, including me, use birth control. could you help me understand why you oppose the use of birth control? >> i do not. i am sorry.

life begins at conception. birth control prevents conception. what i believe is the right course with regard to abortion and live. i would like to see the supreme court returned this right to the state and let states create their own legislation with regard to life. that is my view. states have made different decisions. that is their right to do so. i am not campaigning for an amendment of some kind. i am campaigning to see justices appointed to the supreme court who will follow the constitution and returned to the states this right to make the decision themselves. >> i do not know if you want to have some staff look into this monal forms ofhorma birth control do not prevent

conception. as someone who uses birth control, this is a terrifying prospect for me. i hope you can look into that. thank you. >> thank you. i appreciate that. yes? >> what you think about the fact that our democratic-run senate has not passed a budget since this president has been inaugurated? to me, that has caused most of this financial crisis and problems. we are running on resolution after resolution, which they created the crisis over. they wasted our time and nothing is getting done. what would you, as president, do it the senate is still in the hands of democrats to get an actual budget done? >> one of the responsibilities

of leadership is that you work within your own party and you work across the aisle to bring people together. had the president been spending the last 1000 days inviting people to the white house, go into congress, sitting down in rooms working with people back and forth, trying and listening to new ideas, i would say he has tried and they cannot get the other side to move. he has not been doing that. he is in north dakota campaigning. the job they elected him to do happens to be in washington. you have all these people out of work and the government spending more money that it should be spending. he is not leading. when he that into office, one of the things i found surprising was his decision to dedicate the -- delegate the stimulus to nancy pelosi and harry reid. they had about as much experience in the private sector

as he had. they crafted and $800 billion stimulus plan that protected government jobs and did not get the economy going. they want to do another one like that. shame on us if we fall for that twice. we have to insist on a president that is willing to lead. the idea of a budget process is to make the tough decisions that we need to make rather than kicking the can down the field. washington is broken. i said that four years ago. it is more true today than it was four years ago. washington is broken. is not doing its job. it is not because of the real estate or because of the 51 to 35 members of the senate and the house. -- because of the 535 members of the senate and the house. i like the president. he has never led before.

he did not lead in the legislature in illinois. he did not lead in the senate. he has not had that experience. i do not know the answers to all things. there are a lot of things i can be educated about and learn from. i learned to lead from different experiences doing that. i have five boys. i could come out and complain that the dinner table is not respectful and there is too much joking going on and that these boys should get there on time. but it would not be their fault. would be my fault if those things were going on. i learned leadership at my father and mother's it. -- feet. if i am the president of the united states, i will do everything in my power to get people to work together for the good of the american people. thank you. [applause] hi.

>> there is a huge appetite today for getting rid of the irs. this is a book of special favors for friends of legislators. there is about $800 billion in subsidies we could get rid of to balance our budget. i was wondering how you stand on those issues. >> there is a lot we can do to reform our tax code to make it work better. i would like to see a tax code that has lowered tax rates, a flatter tax rate, where a lot of the special deals are taken out of the tax code. let me tell you what we need to do right away. that process of going through a complete restructuring is going to take a long time. i have got some ideas and ways to do that. i would not go through all of them right now. what i want to do immediately is

healthy people who have been hurt most by the obama economy. that is the middle class. what i look to do is to provide an immediate tax relief package for the middle class. that can be passed pretty quickly if i am lucky enough to become president. perhaps in the first 100 days or so. i would say, for anyone making to $1,000 a year or less, we would eliminate the tax -- making $200,000 a year or less, we would eliminate the tax on your savings. you could save your money for college or a home or whatever you want without having to pay taxes on it. that lowers the burden on the middle class in america. that is a relatively simple change that can be carried out quickly. i would like to have our employers have their tax rate brought down to 25%, which is competitive with nations around

the world. we would get rid of some of these special breaks that have been put in the tax code by the lobbyists and industry groups. what other things could we do? what other tax ideas might work? one would be to go to something called the fair tax. that is to replace the income tax with a sales tax, a national sales tax, a consumption tax. there are a lot of positive features for that. we can look and see if we can make that work and what the pros and cons would be. there are problems that keep me from endorsing the beer tax proposal as it now stands. it raises the taxes on middle- class families. lowers its for the poor and the wealthy. -- it lowers it for the poor

and the wealthy. the concept of a consumption tax makes sense. the so-called flat tax that steve forbes championed. how many years ago with that -- was that? the flat tax has positive features. you have to look and make sure it does not raise taxes on middle income americans. one of the key criteria in looking at tax policy is to make sure we help the people who need the help most. in our country, the people who need the help most are not the poor or the rich, who are doing just fine. it is the middle class. i would look at tax policy that makes tax reporting and calculations easier, reduces the burden on the middle class, and causes the growth of our economy. the best way to balance our budget is to encourage growth. those are my principles.

pardon? the subsidies are deductions. you get the " rent subsidies. you have to take some of those out to -- you get the deductions.ich are people who bought homes and are deducting the interest on their taxes are going to find that that costs them money for something that was unexpected. it might not be helpful for the home industry. buying and selling homes is probably not something we want to hurt. people say get rid of the charitable contribution deduction and the mortgage deduction. those things would be pretty dramatic in the changes they would cause. before i propose that, we would have a carefully dilation on the impact they would have on middle

income americans -- careful evaluation on the impact they would have on middle income americans. >> thank you for being here. the first time i ever saw you was when you were the governor of massachusetts. i was impressed with how you talk about reaching across the aisle. when you were giving your introductory remarks, you talked about how you do not think obama is a bad guy and you think he is in over his head. there are a lot of people in iowa who agree with that. so far, your campaign has not been heavy in iowa. we have candidates who focus on the hyperbole. we have the candidate who once thought the greatest problem in the nation was the movie "a laddin."

we have a candidate whose only claim to fame is that he shot a coyote as governor. are you here in iowa today? is your campaign here in iowa today to finally give the people in the iowa and alternative to that? >> yes. [laughter] i want to get the support of iowans. this is not my first trip to iowa. i will be here again and again campaigning here. i want to get the support of the good people of iowa. i want to win in iowa. i intend to campaign in all of the early states and maybe all of the states some point. i want to become the president of the united states. i did not imagine that would be part of my life person -- life's

experience. had i known i would get involved in politics, i am not sure i would have chosen massachusetts as the place to do so as a republican. it is a little tough in massachusetts. having spent my life in the private-sector -- 25 years working in small business and big business, having started a business and run other enterprises -- i have the kinds of skills america needs right now to get our economy going again. i am running for president. that will take me around the country. you have a big say. i will comes first. you have an enormous say in who the next president will be. americans are increasingly aware that obama cannot get elected to a second term. president obama was on the today show a few weeks after his inauguration. he said, if i cannot get this

economy turned around in three years, i will be looking at a one term proposition. i am here to collect. he has not gotten the job done. [applause] here he is today, inexplicably campaigning and talking about a new stimulus. mr. president, we let you have your way with the nation for three years. he ignored the fact that his first two years he had a democratic house and senate. he put in place a $787 billion stimulus bill. he ignores the fact that he pushed through obamacare. another piece of legislation that the american people tried to stop every way they could, even erecting a republican senator in massachusetts -- electing a republican senator in massachusetts. he is trying to find someone to

blame. we have gone from hope and change to divide and blind. the american people have seen enough of tit. i will not agree with the democrats on all of their issues. i will not compromise my principles. i will look for common ground. i happen to believe there are democrats who love america just like there are republicans who love america. ronald reagan said, it is not bad liberals are in -. - it is not that liberals are ignorant, is that there the leaks are wrong. given the state of our budget deficit and the total debt that america has and the fact we are facing challenges around the world of an extraordinary nature, i think there are good

democrat who will go to the white house who will sit down with me and say, what can we do about this? where can we find some agreement? how about we say, let's make this change. let's find a way to work together based upon our principles. i think that can happen. i have seen happen in my state. i have seen it happen in this country under leaders. i intend to be one of those leaders. thank you. [applause] >> i have two questions. the easy one is, what are you willing to do about czars? are you going to get rid of them or are you going to keep them? the other question is, how are

you going to stop the influx of illegals. to me, you have to shut the spigot off and put defense up. -- the fence up. >> czars. i thought you were talking about sars. i hope i never get to the point when i have to appoint people called czars. there will certainly be on boys to go to different places and -- envoys who go to different places in the world. but czars managing cabinet posts does not make sense to me. the structure of our governmental organizations is kind of strange.

i was in the business world, as i have mentioned a couple of times. every now and then, businesses reorganize. they even consulted firms that said you have to change the way you are organized. people are reporting in the wrong order. businesses do that to be more each fission. we have not done that in this country for hundreds of years. we have the same structure that we had back in the days of george washington. there are probably some agencies and departments that should be combined. some can be eliminated. i would like to see if we can make our government more efficient and responsive to our people. i do not expect to appoint czars. i can tell you that. everything i am and focused upon

is getting america stronger and keeping america strong. i want strong values. i want a strong economy. i want a military that is second to none in the world. everything i do will be focused on making america stronger and keeping america the strongest nation on earth, the hope of the world. i want to keep us the shining city on the hill. i will do everything in my power to keep us strong. you have another question. what would you do about illegal immigration? the interesting thing about illegal immigration is that it is not that difficult to solve intellectually. it is the politics that are hard. some problems are hard intellectually. how are we going to stop the attacks that come from jihadists around the world? that is hard. how do we deal with the various nations where jihadists and various groups are trying to

overthrow governments or terrorize people? that is a tough one. it is going to take ongoing work. the illegal immigration is pretty straightforward. during my last campaign, i went to the border in san diego. i was there with some border patrol agents. we have a big fence there. they build ladders out of rebar and they will throw them over the first fence and climb up, grab the ladder and throw it over the fence. what can we do to stop the flow of illegal immigration? he said something i agree with. you have to have a fence. you have to have enough border patrol in agency-- agent -- border patrol agents to control

the fence. he said you have to stop the magnets. i did not understand that. you have to crack down on employers who hire people who are illegal. you have to have a system that identifies who is here illegally. you say to an employer, look at that card. you type in the number and it tells you whether they are legal or not. if they are legal, you can hire them. if you do not check that card and hire someone who is illegal, you will get sanctioned and find just like you do when you do not pay your taxes. there are other magnets. when i was governor of massachusetts, the legislature passed the dream act. it said, we should give tuition breaks to illegals living in our country. taxpayers should fund the college education of illegals

living in massachusetts. i vetoed that bill. the legislature of held my veto. you have to turn of the madness. build a fence. have enough people to patrol it. if we do those things, we will stop illegal immigration. not because we do not want immigrants. we want legal immigration. we have people waiting in line to come here illegally. we want to bring in people who speak english and have an education. welcome to the usa. we love legal immigration. we will stop illegal immigration to protect our system. [applause] yes, sir? >> a good leader knows his weaknesses and is willing to

bring them out and confront them to make them stronger. what are some things that you struggle with? that your party my struggle with -->> one of the things i no do better is make sure we communicate our message clearly. we do not do a good job of that. when i said jokingly the beginning if anyone's going to the college, he should not hope for a democrat, but i meant that jokingly. most college students did not vote for us. we're not getting our message out. ours is the party of protecting opportunity and making the economy so strong you get great jobs with the get out of school. theirs is the party of benefits

and handouts, and that does not create the opportunity you want in your life. the other day i was pointing out that my democratic friends want to get more benefits to people of my generation, and a lot of us say fine. but we are passing all the burden of that on to your generation. i'm going to be dead and gone before that $14 trillion is paid off. the interest on that, is going to be paid by your generation, and my party is going to try to way to find to stop doing that, by cutting back on spending, not by cutting care. we would like to buy stuff for everybody, but giving away free stuff is going to kill the next generation. we want america to be prosperous for you. i am almost 65.

i am in this race for my kids and my grandkids. if we do a better job communicating to our message, we will get the support of young people. i do not know how it works here at morningside. in communicating the kinds of forces we have, but i think we do an effective job communicating with young people, with hispanic voters. one of the issues, another with this, we're not doing very well with hispanic voters and other minorities. but the hispanic vote is a large portion of our national voting public, and ours is the party that wants to preserve the american opportunity that they or their ancestors came here for. this nation is all about freedom and opportunity, and that is what we are about.

number one, weakness, do a better job communicating our message, and if i am the nominee i will be able to post up on the fact that i am in favor of keeping america strong, creating good jobs, making sure the military is second to none. not for me, but for the coming generations of americans. this is an exceptional nation. there are some, and i think our president is among them, who think america is just another nation with a flag. he said american exceptional as an as like creek exceptional as some or -- greek exce;tionalis m. that idea swept the world, and

nation after nation adopted those principles to one degree or another. this is an exceptional nation with an exceptional mission, and a strong america as part of our exceptionalism. i want to do a better job at communicating that. one more question. >> on the super committee, how can you tell the cuts are that the budget needs and what type of cuts? >> there are a number of things that we can do right away that get us on the trajectory of balancing our budget. what is to take discretionary spending back to the 2008 levels. that is the paul ryan plan. number 2, to stop "obamacare." turn back to the states responsibility for their own uninsured and their own poor. number three, take medicaid, which is a huge federal spending

program, grows at very high rates, and send that back to the states and say you care for your report for the way you think best. we'll give you the money you got last year, and you live with that figure. number 4 would cut federal employment by about 10%, maybe more. [applause] we can do that through attrition because we have a lot of people who are retiring now, and finally, we set federal compensation equal to the compensation that exists in the private sector. yesterday, and i do not -- but i saw a me, report yesterday saying the average compensation of a federal employee is $125,000. that strikes me as higher than

what exists in the private sector. i think we should link federal employee compensation with that that exists in the private sector. if you do those five things, and you balance the budget. we also have to be honest to young people coming along, and we are talking about college kids and people in their 20's, 30's, 40's, 50's, about what we are trying to do with medicaid and medicare. i want to make sure we're not lay in on that a massive burden that they cannot possibly carry out and at the same time live in a country that has opportunity. i want to make social security and medicare sustainable. you do all those things and thank heavens you are going to be able to cut the spending of the federal government, cap it at 20% of the economy, and then

you have a balanced budget amendment. those are the steps. i did that, not at the federal, but at the state level, and the numbers were smaller. our budget gap was $3 billion. we made the tough decisions. cies andolidated agents put agencies together. we got rid of press secretaries and lawyers. some programs in my budget i actually eliminated. we found a way to balance our budget. that is what i will bring to washington because the idea of borrowing ly r. w hundreds of billions of dollars, $1.50 trillion, knowing

we cannot pay that back, and asking the next generation gets stuck with the interest and principal, i do not understand how that can go on. i think it is wrong and immoral. we have to stop that. i will make sure that happens. [applause] thanks so much for spending some time with me. i hope those of you who are going to college credit for this and get an hour's worth of credit, and for those who have come in from the community, thank you for spending your time. this is an important election. you know that. we're walking on an economic tightrope right now. on what side weekend slipped into a double-dipped recession, and with all their borrowing that has been done, the printing of money that has been done by the fed, it will be a tough time

to go into a double dip. the other side of the tight rope is a long slide like japan has experienced, and i do not want to see that happen. if we stay on our current course, one of the other two frightful scenarios will be realized. it is essential for us to restructure our economy to make sure we can be competitive with anybody in the world, opening up markets, getting regulation to work, getting energy policies on track to allow america to compete globally -- those are things i will do. i will make sure with every ounce of my energy that we keep our economy strong so we can with a strongughselves military, and the future will be brighter than the past. that is why i am running. i love this country. i hope i made that clear. i did not say that as directly

as i would like to. i love america. we are an exceptional nation. i love this country. i love the principles upon which it is founded. i believe in america. i believe in free enterprise. i believe in freedom. i believe in opportunity. i love america. i believe that we have a role to pass to the next generation in america that is strong and free, and i am not going to die without doing everything in my power to fulfill that responsibility, just like my parents fulfill their responsibility, to give us a land that was free of those who would impose their tyranny upon us. i do not want to go down in history as being part of the worst or mediocre generation. we will not catch up to the greatest generation, but we will be a great generation. i want you young people to say thank you that my mom and dad

went back to work to cut back the excess is of government to provide for the future. this is a great country with a great role and responsibility. the defense of liberty is not on delong and trusted in the nation that is weak or timid. it is our responsibility to give to the next generation of america just as bright and prosperous as the one we inherited. and appreciate your willingness to be here and i look forward to working with you as your president. thank you, guys. great to be with you. [captions copyright national cable satellite corp. 2011] [captioning performed by national captioning institute]

thank you. good to see. absolutely. [unintelligible] >> thanks for answering my question. >> thank you. appreciate your being here.

thank you. we got members of the media. i think you got it backwards. no, we are in the picture. can you make this thing work? diagnosed how to work most of these cameras. it is on video. that will be fine. all righty. there we go. it took a little time, but -- thanks so much. keep it up. need your help again. thank you. absolutely, happy to.

the you go to school here? -- do you go to school here? good to meet you. thank you. he is a good guy, isn't he? thank you. how are you, sir? good to see you. i will do that. what have we got here? touchstone energy. nice to meet you. thank you for being here today. hi, how are you. is this your daughter? just a student. are you a faculty member here? good. >> thank you so much. >> thank you. what are you studying? >> biology.

>> to become an md? to do research? that is what my son wanted to do, but he found himself getting attracted to radiology. good luck to you. >> thank you so much for coming. >> thank you. thanks for being here. they not want the think it is gone to -- going to happen after we repeal "obamacare"/ >> returning the care of the uninsured back to the states, let states tried different models. one thing i would do that you will find it relevant is i

think the discrimination that exists between individual participants should be eliminated. corporations buy insurance for their employees and get a tax advantage. when individual buys insurance, they do not get that. i would like individuals to get the same break. [unintelligible] >> what process do you think you will use to come up with these ideas? >> there is a process of gathering information, and what you do that through hearings are bringing in people from different backgrounds, and you like to experiment with them before you impose them -- >> how about the experts? >> everyone has to sit at the table and express their views. one is the idea of letting individuals purchased insurance

on a tax advantage bases just like companies. that means people can continue to get insurance, like most people will, but as small business -- an individual who is not working can buy insurance at a relatively fair price at a tax advantage basis. we will get more people in the insurance pool by letting individuals have that same treatment. thank you again. >> thank you. >> that's great. what are you studying? elementary education. there we go. thank you, guys. good to see.

thank you so much. thank you so much. all right. all right, i will sign that. do you want me to put your name on that? great, thank you. signed that? all right, i will do that. i have not got that one, but how about this one? all righty. thank you, good to see. hi, there. how are you? absolutely. you do that. say that louder. i wanted the media to hear that.

just kidding. we did that for years ago. don't you want to get in the picture? all right, the rego, all right. thank you. nice to see you. all right, we will be back. how are you? thank you. nice to see today. appreciate you being here. thank you. thanks for helping. got a pen? but it isdy signed, signed by machine.

look at that. thank you. you.to me you gaddafi, a terrible tyrant killed his people. the world as a better place with gaddafi gone. that works. thank you so much. thank you. >> come back to iowa.

>> i saw your dad. >> you have another chance to watch mitt romney's town meeting in iowa tonight at 8:30 eastern. more tomorrow with ron paul speaking at a youth for ron paul reilly at the university of iowa in iowa city. 9:00 p.m. eastern on friday, live on c-span2. >> this weekend, six candidates travel to des moines. watch our live coverage of herman cain, newt gingrich, rich santorum, rick perry, ron paul, and michele bachmann.

here is what i had coming up this evening. reaction to the death of muammar gaddafi. we will hear from president obama, ban ki moon, and a u.s. special representative to libya. on c-span2, some of the senate work on updating the no child left behind law. and then prime minister's questions from the australian parliament. the senate banking committee looked at the future of mortgage finance and whether the 30-year fixed mortgage should remain as the standard method to finance home purchases. tim johnson chaired the one hour, 20 minute hearing.

>> i called the hearing to order. i would like to thank our witnesses for being with us today. this will be the 11th housing and finance reform hearing held before the committee. before we begin our series of hearings, i will release my agenda for the committee, which included a priorities. maintaining the widely available 30-year-fixed rate mortgage was one of those priorities. i believe we need to reform our housing system, but i am concerned about the unintended consequences for our housing market that could result. a new system that eliminates the most popular and stable mortgage product in the country would be a step backwards, rather than an

improvement to our housing market. let me be clear. i am not advocating that the 30-year fixed rate mortgage be the only product available. short-term fixed rate loans like the 15-year or 20-year mortgage can be appropriate for certain borrowers. adjustable rate mortgages can also be appropriate for our workers who can afford them. however, any new housing finance system must ensure that the 30- year-fixed rate mortgage continues to be widely available to qualified are worse across the country. the pre payable long-term fixed rate mortgage allows households to do their finances better and establishes a stable housing cost, which is not always

available. home ownership is not always the right choice for everyone, but for those who choose to own a home, the 30-year-fixed rate mortgage is the most predictable option for financing their home. witness testimony during the last hearings stated that under some proposed systems the 30- year fixed-rate mortgage would likely require substantial down payments, higher incomes, and higher interest rates, restricting the network of borers to a substantially small number, compared to today. this is the last thing our housing recovery needs. our witnesses have extensive experience and knowledge about the impact the 30-year fixed- rate mortgages have on homeowners. the mortgage market and the economy. i look forward to hearing their

testimony as well as the options for congress who, if we are to continue what i believe is a necessary product, and with that i will turn to senator shelby. will it's hearing examine the pros and cons of the government subsidizing the 30- year fixed-rate mortgage. during the depression the federal government established direct and indirect subsidies for 30-year fixed-rate mortgages. for many americans, the 30- year-fixed rate mortgage has made it home ownership possible. the failure of fannie and freddie and the $169 billion bailout of those institutions demonstrate that the federal government cost support of the 30-year mortgage comes with a cost. accordingly, if this committee ever decides to undertake housing finance reform, it will

need to determine whether the benefits of the government support for the 30-year fixed mortgage outweighs the cost. in addition, if it decides to consider it to subsidize the 30- year fixed-rate mortgage, the committee will be to find a way to protect taxpayers from having to pay for bailouts in the future. today's hearing provide some insight into how the federal government support for the 30- year fixed-rate mortgage and tax consumers and taxpayers. for example, in the 30-year fixed-rate mortgage -- is the 30-year fixed-rate mortgage always the best option? it is the prepayment option included in these 30-year fixed- rate mortgages truly free? and what has the subsidy of this product already cost the american taxpayer, and can this product be offered without that subsidy? consumer choice is very important. consumers should be able to

purchase a 30-year fixed-rate mortgage at the appropriate market rate. if they determine that product is best for them. i think we must not treat incentives that could push people toward a 30-year fixed- rate mortgage even when it would be harmful to them. also i hope to learn from the date's hearing held subsidizing the 30-year fixed-rate mortgage impacts our financial system. for instance, is the claim that the financial crisis could have been averted if only more people possessed the 30-year fixed-rate mortgage a fact or fiction? what unintended consequences have been created by subsidizing the 30-year fixed-rate mortgage? these are all important questions, and there are many more that need to be answered as we go along. for many people, it is assumed the narrative surrounding the 30-year fixed-rate mortgage has always -- already been written

and there's no need to investigate the facts. as we proceed with the housing finance reform, i think we must seek a full understanding of the facts. hooker legislating by anecdote -- legislating by anecdote is not preferable. only by doing a fact-based announces can we statement? thank you, all. the record will be open for the next seven days for any other materials you would like to submit. i like to welcome the witnesses. our first witness is miss janis bowdler, the deputy director of

wealth building policy project. john fenton is the president of affinity federal credit union on behalf of the national unions. her hairdr. anthony sanders is a professor of finance from the george mason university school of management. dr. paul willen is a senior economist from the federal reserve bank of boston. and dr. susan woodward, a president with the sand hill econometrics. welcome all today.

with your testimony. >> thank you and good morning. my name is janis bowdler. my project promotes fair markets her her her hat were latino families can build wealth they can share with their children. ami hope today's hearing sheds light on the importance of the 30-year fixed mortgage. without this tool, home ownership would be a luxury reserved for the affluent. home ownership has been the long -- i will provide a brief overview of the 30-year fixed mortgage and share ideas. let me start with the benefits of the 30-year fixed mortgage. the long term makes the asset more affordable.

modest downpayments open the door with those who lack family wealth. the bar can predict the final payment -- the borrower can predict the final payment. there are two key reasons why supporting the 30-year fixed mortgage is good public policy. it makes homeownership possible for families who did not inherit wealth and provide stability to families who left the budget carefully. these teachers have helped create a stronger middle class. this is true for hispanic and black homeowners. the benefits of home ownership have not been equalled available. the unfair steering of borrowers of caller to toxic mortgages. the subprime loans are expensive and more likely to end

up in defaults. wealth held in white households exceeds that of latinos by 18 to 1. this gap is issued to the loss of homes through foreclosure. critics order of famines would be better off in adjustable mortgages. most people did not play the market and they do not hedge interest rates risks. the predictability and security of a 30-year fixed mortgage helps them meet their goals. we need a robust market for whom -- now is not the time to abandon our commitment --

several decades of affordable lending have taught us how to reduce the risk of lending to new buyers. in a recent comparison, the only difference was the kind of loan they received, the 30-year fixed mortgage outperformed the subprime loan. home ownership counselors have felt more than 25,000 moderate income families purchase a home with a prime mortgage. when families receive the right loan, they can be successful home owners and build wealth, even with modest incomes. tight credit standards and overlays on fha are limiting loans in the market today.

the threat to the future of affordable lending has as most concerned. the idea of a wealth standard. critics of fannie and freddie are pushing for a complete dismantling of our current secondary market system, even though lenders say they would not be able to offer fully amortizing loans in a completely private system. we should work together to preserve those aspects of our system that work well. i have attached to my statement something signed by 16 other civil-rights organizations. i offer three specific recommendations today. maintain this the secondary market liquidity for affordable

loans and made available to all qualified families. support pre purchased housing council. reduce barriers to purchasing a home by reducing -- thank you and i would be happy to answer any questions. >> thank you. mr. fenton, you can proceed. >> good morning. my name is john fenton. we appreciate the opportunity to share our views on housing finance reforms and the value of the 30-year fixed mortgage. credit unions were not because of the recent economic crisis. the credit union mortgage lending has outperformed banked mortgage lending. these are solid products that they could afford.

there is no evidence that the collapse of the housing market was due to 30-year fixed mortgage. congress began offering 30-year fixed mortgage back in 1977. this is straightforward and easy to understand and provides a predictable monthly payment schedule. the lending institution assumes the risk associated with interest rate risk increases. having too many mortgages in the portfolio can be cause for examiner concern. we mitigate risk of our portfolio by hedging with interest rate swaps, caps, and matched borrowing. the securitization activities of fannie and freddie help lower the relative cost.

the 30-year fixed mortgage may still exist. long-term fixed-rate mortgages will become riskier propositions for credit unions. consumers may face additional costs to mitigate risk. we believe that it would further limit the availability of long term fixed rate products and increased the cost of mortgages to consumers. fannie and freddie are a valuable partners to credit unions who seek to hedge. fannie and freddie will buy loans on the secondary market.

the liquidity created allows them to reinvest those funds into their membership or institutions by making new loans. without these new relationships, credit unions -- we like to stress the importance of maintaining this system. as you consider legislative proposals, we believe that there is a core set of principles that must be considered to make sure credit unions are treated fairly. there should be at least two entities to insure competition. the government should issue guarantees on payment of principal and interest for mortgage-backed securities. credit unions must have on

interrupted practice into the secondary market. credit unions is could support a model that is consistent with a cooperative entities model. a board of advisers should be formed. a central is a vital, the gsc should be self funded. it should reflect the quality difference. fannie and freddie should continue to function until such time as they begin to repay the government debts. take into account the consequences of the federal home loan banks. the 30-year fixed mortgage remains the most popular product to credit unions today.

it to remain a readily available products -- it should remain a readily available product. with ever to reform the housing finance system, it is important to consider the impact this behalf on credit unions and make sure they maintain access to a viable second market. i welcome any questions you have. >> thank you. >> mr. chairman, my name is dr. anthony sanders, i'm is professor of finance at the george mason university. the fixed rate mortgage occupies a central in the u.s. housing system. more than 90% of mortgage originations. the frm is a consumer-friendly

instruments. it offers payment stability. if rates rise, the bard benefits -- these consumer benefits have costs. the prepayment option creates significant costs. if rates rise -- to compensate for this risk, lenders in corporate a premium that all borrowers pay regardless about whether they benefit from might refinance or not -- from a refinance or not. the adjustable-rate mortgage

also has consumer friendly benefits. banks will originate and hold 30-year fixed mortgages even without the government guarantee, is like they have done in previous years. this baby a short-term effect because freddie mac, fannie mae fha have cornered the mortgage market. the only country in the world was subject high concentrate -- most countries have shorter maturity -- the u.s. home ownership rate is comparable to that of other countries with higher arm. there is nothing natural about the 30-year fixed mortgage and home ownership. arm rates are typically less expensive than fixed-rate mortgages.

all 30-year fixed mortgage pay for the prepay option even if they do not use it. 30-year fixed mortgage is risky for consumers since the principal pays down so slowly. small house price declines put the bars in a stressful negative equity position. sure it would be promoting -- should we be promoting 10- or 15-year mortgages instead? is that our objective, to put people in the biggest houses they can afford? arms are consumer friendly.

boris will be more careful on taking on -- borrowers will be more careful on taking on more debt. arms have lower default rates than fixed rate mortgages. homeowners lost $7.25 during the peak of the housing bubble. these are catastrophic to those households if the markets tanks again. i aniston how some people like the comfort of the payments -- i understand how some people like the comfort of the predictable payments.

thank you for the opportunity to testify. >> thank you. dr. willen, you may proceed. >> i thank you for the chance to testify today. i will take on today in my spoke remarks a conventional wisdom about the fixed-rate mortgage. it starts with the invention of the fixed-rate mortgage, which is widely attributed to fha. in the 1930's, prior to the depression, most american families had short-term rate

mortgages. these mortgages expose them to fall co-payments and caused massive disruptions during the depression. so the fha invented a new type of mortgage which was the long term fixed rate mortgage. the payment never changed until the loan was paid off. the borrower was never vulnerable to payment shock. it was like the safety elevator came along. before that, the passengers plunged to their death. there replaces was something that was inherently safe. lenders forgot the lessons of the 1930's and started issuing complex mortgages.

borrowers were hit with these payment shocks. i will take on this conventional wisdom and argued these basic premises do not fit the facts. the long term fixed rates were invented by building and loan societies. they were the single largest source of funding for the typical family when they got a mortgage. there were widely used in the year before the depression. 40% of the mortgages originated were originated by building and loan societies. 95% of those originations were long-term, fixed-rate, fully amortized mortgages. you can see this in table two of my testimony.

they were devastated by foreclosures. but what about the most recent crisis? in table one, i show some data that we put together. but those who've looked at the data, the proper level data has come to the same conclusion. our sample is of the foreclosures who have lost their homes. 80% of them suffered no payment shock prior to defaulting on their mortgage. the mortgage payment the made at the end of the loan was the same as their initial payment on the mortgage. 59% had a fixed rate mortgages. 1.6 million mortgages. it is a safe product.

when owning a home, a family financed by a mortgage faces many risk. there is jobless, ellis, business i a, divorce, and there is falling house prices. research has shown that compared to those risks, the funds rate mortgage payment presents a small problem. the benefits in terms of foreclosure prevention of ensuring the availability of a mortgage with a payment that can never go up, in my opinion is very small. i hope you find these finding add insight to work and i would be happy to address any questions. >> thank you. dr. woodward, you may proceed. >> thank you so much for

inviting me. i'm here representing myself. i'm an independent economists now but the lived for 10 years in washington and i spent a quarter years as the chief economist at the securities and exchange commission. the critics of the 30-year fixed mortgage claim it is unfair for homeowners to benefit from the rest avoid it while taxpayers benefit from the rest from it. taxpayers are homeowners, too. there is nothing unfair about this trade-off. i think it is an important piece of social policy. let me offer a few facts. home ownership is around 70%. the fraction of households to become homeowners is more like 85%.

household incomes rise over time and peak at around age 55. the people who benefit from the availability of the 30-year fixed mortgage are also the same people who pay taxes if and when problems arise. the benefits come when families are young. this is a fair trade-off. my guess is that they will say they want the 30-year fixed mortgage to be available. we should not forget the rest of adjustable-rate loans. i think there is some considerable risks. the arm design is basically flawed. these are numbers to are relevant to today. suppose the rate of inflation

went to 4%. the likely change in the home owner's income is the current inflation rate of about 4%. but the borrower's payment would rise about 25%. it was mostly affluent homes prior to its financial crisis that have the adjustable-rate loans. arms threaten the economy, too. there would have been more mortgage defaults if all borrowers have had arm loans then. there is some risk and potential cost to taxpayers. there's nothing unfair about this trade-off.

do we need government support for the 30-year fix? the tube's most important innovations in financial markets were undertaken by the federal government. the first was the support for long-term amortizing fixed-rate loans. we have discussed this before the hearing. it made the amortization more precise is scheduled and not tied to ownership of shares in building and loan societies. it pooled the default risk. so borrowers were better off and things were better off because they were much more comfortable making these loans. the second big innovation was

ginnie mae. this was an astounding success. when ginnie was introduced, there was a long time real mortgage rate of about 4%. this was all entirely already insured fha loans. this improved packaging of them. so at the end of the day, we're not going to rock institutions like fannie and freddie without some government push, especially now when the large banks have such better access to the capital markets than the smaller lenders do. there are many reasons that we should give smaller banks --

thank you. >> thank you. >> what elements in the market must be preserved to ensure the availability of the 30-year fixed mortgage where borrowers in rural areas like those in south dakota? >> entity like ginnie mae, i don't think there's any threat with the removal of ginnie mae. something like fannie and freddie and their successors for the conventional market. that is a substantial piece. to turn loans into liquid securities through an entity like them. >> dr. willen, we have seen the

credit markets dry up an increasing percentage of 30- year fixed rate products. how with the availability of credit to average americans change in times of economic turmoil? >> their two separate questions. -- i think we need to make sure no separate out what it is -- the 30-year fixed mortgage is the fixed-rate part of it. what happened over the past quarter years is that -- in the past four years, every part collapse, including fannie and freddie. if fannie and freddie have been

doing -- if the government was going to intervene to back up the market, they could have intervened to back up the adjustable-rate market. the portion of the market we intervened to help was the fixed-rate part of the market. that is why that is the part of the market that survived. the federal reserve indecent large-scale asset purchases. >> miss bowdler, i have a question for you. how would the absence of a government guarantee affect the availability of the 30-year fixed mortgage? how would this affect the average american borrower? >> our understanding after

talking to a lot of lenders is that without that guarantee, they would not offer 30-year fixed mortgages and they would not offer a long-term financing at rates that the average person can afford. yes, some financing can continue to exist without the next generation of fannie and freddie, but it would only be for families that have large amounts of inherited wealth that they can put towards down payments or to provide out in a shock. >> dr. woodward, what skills to boris need to have to develop what their risks of adjustable- rate mortgages are honest and how their interest rates which adjusts? >> they need at least an mba. it cannot be even 1% of

households that understand the interest rates that are behind arms. the london interbank borrowing rate -- i had a friend's panicked daughter come to me because she cannot refinance her arm. i got her loan documents. i know exactly where to look up this number. it's a fairly benign index. once i told what it would look like, she calmed down. but almost no household understand the interest rates to which their arms are linked. finance is hard. >> mr. fenton, what are the characteristics of the

borrowers that come to your institution and request 30-year fixed mortgages? why is that products so popular? >> the characteristics are very diverse. we have all different segments of the committee, and to borrow. the product itself is important at different times. you have to offer members a choice and they have all different levels of credit backgrounds and understanding of the product that are out there. the key to what is to understand that it in a time of low interest rates, you need to be able to support a product like the 30-year fixed mortgage and in times of rising aegis rates, you might look at a different type of product. we evaluate each member based on their needs and what is the best product for them. >> senator shelby. >> dr. sanders, a central

argument made by some advocates is that without this guarantee, the 30-year fixed mortgage would not be available to consumers. for the moment, if we could set aside the question of whether the 30-year fixed mortgage is always the best products for consumers and go to this. if a consumer desires this product, it would be available even if there is not a federal guarantee? i can go back to myself many years back. i bought a house. it was a conventional 30-year fixed mortgage from an insurance company. the federal government was not involved. we have to come up with a pretty healthy down payment, but that is what we wanted to do.

elaborate. >> i have had home loans, arms and fixed-rate mortgages and there were never touched by freddie and fannie. they will start making loans again. fannie and freddie and fha have such a dominant presence in the security markets. we have spelled out the 30-year fixed -- we have bailed out the 30-year fixed and not the arms. everyone is mentioning the fact that there is interest rates risks but they're more the well -- we should be forcing consumers to bear part of the

risk as opposed to someone in iowa hit with a higher tax bill. but it will come back. >> the prepayment option. you discuss how borrowers who of a fixed rate mortgage with a so-called free prepayment option are in fact paying fat option whether or not they realize it. explain what you mean. >> in other countries they have non-repairable mortgages -- non- prepayable mortgages. there is a substantial difference in interest rates. it can be anywhere from 30 to 70 basis points. we can help consumers out.

it would cut their expenses. arms are cheaper. 15-fixed are cheaper. >> i do agree with the economist. lot of consumers don't understand the adjustable-rate mortgage. what can we do to make them understand? can would be more explicit in the terms one day by house? "you are paying x today but my co-op or might go down, rather than just sign here, there." a lot of them did not understand. >> two issues. it was simple to have a simple cover sheet like we do in

securities or have a risk page saying that here is your current rate and it will be fixed for this amount of time and then it goes up to whatever level and some spread. i know susan will kick me after this is over. if a consumer sees something as something as libor in the contract, why would a sign that -- why would they sign it? is much more benign than we're making it sound. we can make it more clear. >> i want to direct this to you. dr. is easier to understand been any adjustable-rate mortgage. the average household will not understand what risk is undertaking with an arm. dr. woodward's approach is to success that people are not capable of making educated choices. i would think they could make their choices. have you seen any evidence that suggest consumers are not sophisticated enough to handle an adjustable-rate mortgage? i asked paul. other instances where the 30- year fixed mortgage could be more harmful to a borrower then an adjustable-rate mortgage? >> there are many things we deal with in life the way -- or we don't have as much understanding as we need. most people don't understand why transmission is but that doesn't stop them from driving cars. the risk in adjustable rate mortgages -- compared to implement risk, compared to the risk they face in their jobs is tiny. and no one understands employment rest. to understand the distribution of your labor income next year -- nobody understands that. but people live with income rest all the time. and that is most people and they deal with it. the mortgage payment is a third

of your payment and it goes up 10%, that is 3% of your income. people do with 25% income loss in a year and the do not end up in foreclosure and the do not end up bankrupt. on the benefits -- in this crisis, we have seen exactly how much damage the fixed-rate mortgage can do, so ever by a focus on the fact that adjustable rate mortgages can got a would dismiss the fact that they can go down. they go down when interest rates >> most people don't unded

what a transition is or how it works but that does not stop them from driving cars. if the risk embedded in an adjustable rate mortgages what i keep coming back to. compared to employment risk, compared to the risks they face in their jobs, the the risk they face at their job is tying. to understand the distribution of the labour income next year, nobody understands that, yet those people who don't work for the government live with income risk all the time. that is most people and day deal with that. if it goes up by 10%, that is 3% of your income.

people deal with 20% and don't end up in foreclosure or in bankrupt. that's the answer to your first question. it might be the second. in this crisis, we have seen exactly how much damage the fixed-rate mortgage can do, so everyone focuses on the fact that the rates on adjustable rate mortgages can't go up in completely dismissed the fact they can go down. they do not go down randomly. when do interest rates go down? they go down in recessions. libor has gone down by 500 basis points. we looked in the data. people who had fixed-rate mortgages, most of them are paying 5.5% or more on those mortgages. these are the people with

negative equity. the people who have adjustable- rate mortgages, their rates are under 4.5%. they do that without any assistance from anyone. they don't have to beg the lender or get a modification. the only people of fixed-rate mortgages were paying low interest rates are people who have bought -- who have fought bitterly to get a modification. the adjustable-rate mortgage has an automatic built-in stabilizer property that a fixed rate mortgage does not. prepayment is not free. you have to get an entirely new mortgage. >> its built-in to the price? >> the option is not free, but even -- wire we having this problem? why are we having this hearing about the fact people cannot refinance their mortgages, it's because between the closing costs, getting title insurance,

covering the transaction's cost to the lender, it costs two points. there is no free prepayment. forgetting the option price, that's why so few people are refinancing right now. >> in all fairness, an adjustable rate mortgage, you have to tell the consumer it can go down because of the price of money, but it can go up. oftentimes, i think a lot of people haven't realized that. they should. >> just going back to this. in massachusetts, there's a writer on adjustable-rate mortgage which every borrower signs and goes through exactly would you describe. this is your rate, this is where you can find out, this is what will happen if the rate goes down. >> in your testimony, you point out the adjustable rate

mortgages are defaulting more than fixed-rate mortgages -- in your words, [inaudible] so there is is automatic correction -- why are people with alternative mortgage rates defaulting more? >> let me be careful about this -- it is a relatively small difference. it's not anywhere of the order of magnitude of the increase of foreclosures we have seen. going from 1% or 2% or 5% of borrowers, that is not because of adjustable-rate mortgages, that is because of falling house prices. what i said in my written testimony is the people who take out adjustable-rate mortgages are people -- are different from people who take out fixed-rate mortgages. the assumption is if they took out fixed-rate mortgages, they would be more likely to default.

for people to keep properties for a short time, the fact the board did not intend to keep the property for a long time, that's why they went for an adjustable- rate mortgage. people like that are more likely to be speculating on property. that is what we think the difference is picking up, not anything about the product itself. in point of fact, the adjustable-rate has been a lower-than-expected partly because of the falling interest rates. the notorious option arms -- because interest rates have fallen a lot, those london that performing much better than we expected back in 2007.

the reason people default on their mortgage is some life event that hits them. that's why they default on their mortgage. that does not depend on a fixed or adjustable rate mortgage. there's nothing you can do about that. but since we spend time talking about how we can stimulate consumption by getting people into lower interest-rate products, the adjustable-rate product does it automatically. it is difficult to measure in the data, but assume -- we assume they have more with which to consume. that is the goal that we have. >> what is your issue of the differential between the adjustable-rate defaults? >> paul is right. the households signed up for arms are different than the ones that sign up for fixed. in terms of what when and how interest-rate change and how to fix households, we had an

episode of rising interest rates from 1970 to 1980. their loans outstanding then, but there were affluent households, not ordinary households. from 1980 until now, interest rates have come down, down, mostly down. so we have not really seen the full force of what happens when arms reset upward. today, we like the term structure of interest rates. pretty flat. but could they go up? yes. it's much more likely than they could go up a lot then it would go down because we're so close to zero they can't go down much. if the arms reset up 2 points, the payment will rise 25% and household increases is not going to be that big. so you want household good at managing their finances, not bad at managing finances taking that risk. what we can see in the data is

the default rates are higher. the same credit score, same debt to income ratio, the households that sign up are taking some risks somewhere else that we cannot observe. >> we had an experience in the 1980's where we had a significant increase in interest rates. >> we did. i am old enough to remember. >> my father told me about. [laughter] in canada, they had much less of a commitment and they sought turbulence and housing markets. that might be an example that influenced a lot of people to get into 30-year fixes. if you like i was, about 25 or 26 in the 1980's, having a fixed rate look really good.

we might be captives of our history. >> two things about the canadian market -- they did have a lot of defaults as arms race said. that's in a market in which the rate to which they reset is managed by the government. it is not a completely objective right like libor or one-year treasurys. there are pushing a get -- there is some pushing against it at the federal level. >> thank you. >> thank you, mr. chairman. e's and theat the gs loan guarantee rate charged and the fact that credit was available all boy through, it seems it had to affects -- we have an artificially low interest-rate, it actually drives up prices of housing because people are looking at

what their mortgage payments are. that is generally speaking what people are looking at -- what is their payment going to be color regardless of all the other issues. what we have had is a situation where our government guarantees, which artificially kept prices lower than they should have been has done the opposite thing for consumers would like to see happen, and that is it has driven up home prices. it has. there is no question. i'm not asking a question. stay fact it has. then you have a situation you don't have a price signals. we continue just, as we have this bubble, we had nothing in the market that was slowing that down. without this government guarantee, the private sector which we do have a 30-year mortgage market in the private sector without government

guarantees, and it is not as robust as it was because we had this housing crisis, but much of what has happened could have been avoided without the gse's playing the role they did. >> i would say yes, the gse's did help the under price of insurance they could charge lower rates to consumers. it sounds good, when you couple with lower down payment insurance and easing of credit standards over time, we got what austrian a economist call a credible. we have the house prices coming up and this is making housing affordable, which fannie and freddie no longer have as a slogan. we created a bubble and a burst. 7.25 trillion dollars of home-

equity is were lost which has been devastating particularly for lower and middle-income households. those guarantees are dangerous instruments and have to be pared back or taken away. >> there has been that a whole industry built around us and it's interesting to be here in washington and in various sectors. there's a whole infrastructure built around making money off what the government has put in place. i know we all thought fully want to move away from that. everyone wants to see us move away, regardless of where you sit today. i think it is universal. but let's move back to where the at this mellon. i don't understand why we don't have a built-in prepayment penalty. why is it in the psychology of what we have done a one-way

street? in commercial buildings, when you pay the loan off, you have to pay a penalty. if rates are lower than when you finance, you have to pay penalty. why have we not had that? it seems like that would solve a big part of the problem. >> i was going to put that into my testimony. on the commercial side, you have arms galore. they have lockouts, payment penalties or something saying if you're going to refinance, you pay a hefty price. one of the reasons we don't in the residential market as we've built a huge empire of mortgage- backed securities that our agencies, fanny, freddie and ginnie mae. you want to have liquid prepayments meaning the option to prepay is what everyone likes to speculate on. they avoid having prepayment penalties because there is not a lot of action in them. but that should not be driving

public policy, the fact mortgage-backed security traders like the option. >> any other comment regarding prepayment? >> it is my understanding the absence of prepayment penalties is mostly a matter of state law. all 50 states have a limit on the prepayment penalties that can be created. as far as the mortgage-backed securities markets go, what they want is not necessarily the absence of prepayment penalties, they want security where they are all the same so they can trade as liquid instruments. >> said the penalty is zero? >> it doesn't matter whether it's zero or $100 or thousand dollars. what they want is for all mortgages to have the same prepayment penalties so they can trade identically. >> my time is up.

>> i agree on that statement. if you look at the number of prepayment mortgages with huge prepayment penalties, you'll find a number close to its just not exist. >> what do you think would happen if fannie and freddie all of a sudden said we're going to continue doing what we're doing? what if they also said we have yield maintenance on these things. you want to refinance in seven years, if you want to have the opportunity for a low fixed-rate mortgage, you're going to pay maintenance on that. what would happen in the marketplace? >> mortgage rates would absolute -- would actually decline.

since you are sharing the risk, rates are declining because prepayment auctions raises mortgage rates which is one of my arguments -- why were we not refinancing -- why do we pick 30-year fixed? that's prevalent across the whole system. if we are interested in homeowners, we should lower their rates that we believe that theory. but we did not. >> thank you. >> i would like to disagree with that to some extent. i believe it is an affordability issue. if you add pay -- prepayment penalties, the shift the cost to the consumer and long-term, it's going to have a negative effect on the real estate markets as we go forward. you have to have a choice. there are members in every

lifestyle. depending where you are, there are options. adjustable rates may be one of those. we cannot just have one product. the consumer should not bear all of the cost on this nor should anyone segment. >> it seems to be the person taking a loan out should bear the cost of the loan. i don't understand what you are saying. that's a weird statement to me. if i'm borrowing money and i decide -- the cost to society of me taking certain action, it seems i should bear that cost. that is a strange statement. >> it is how you view cost. cost is an investment and it depends which angle you are looking at it from. from a public policy perspective, the cost is

returned and a vibrant -- in a vibrant economy. there's a return making the investment and it should not be borne by the consumer because the consumer does not understand it fully enough and it's going to affect their ability to go into it. they will rent a home as opposed to buying it. that has a negative impact on the economy. >> thank you. >> the fixed-rate mortgage has been criticized as problematic for homeowners on interest rates -- homeowners can take advantage of lower interest rates. do all arms allow for a drop in interest rates? >> yes.

virtually all arms allow you to refinance. but they refinance at the recess dates. -- the reset dates. >> can i finish my answer? one of my friends is a famous person locally in the mortgage market and he only uses arms. arms continue only with a couple of episodes have always been lower than fixed rates and he says i will roll them over if the rates stay low, if not, i will -- the reset has been trivial in comparison. other than one shock, we have not seen a problem with them. >> thank you, mr. chairman. i appreciate the witnesses being here, especially mr. fenton from the jersey, who is well-known as

an expert in the financial industry in our home state. i'm concerned there is a universe of borrowers who in fact can be responsible borrowers, but at the end of the day, with al -- without the guarantee of a 30-year fixed mortgage and that eliminating the opportunity for them being irresponsible bar or and prices them out of the market. -- being a responsible borrower and prices them out of the market. there are those who argue that the private sector alone will do this, but we are not seen much securitization of jumbo mortgages in this marketplace and the private sector has not

come in as of now. if we do not have an evidentiary set of circumstances under the most propitious opportunities for the private sector to come in and they have failed to come in to accomplish them, how is it we expect individuals to can be responsible borrowers under a long-term fixed-rate to be part of the marketplace? do any of you have a comment on that? >> i agree the securitization and jumbos is a great example where privatization has not entered the marketplace. you cannot rely solely on privatization to come in and bring capital in without some offset to the risk they're going to take. risk is offset by price and in this case, the price would negatively affect a different segment, which is the consumer

segment. we need to balance that and that's for the government has some role in coming in and trying to encourage the private sector to bring their capital to the table. >>while we have this issue, we have the same problem on the lower end of the market. this is essentially a middle market effluent best of the best. they're taking the cream of the crop. borrowers who are qualified by lead in neighborhood where they have the not desirable or lack the family well are getting left out of the market. those are the borrowers or they show right products at the right support. we do not see the private market stepping in.

>> welcome back. you are our subcommittee hearing. >> let me take a different spin on it. the guarantee, when you combine that, we have encourage households to take on more risk than the ordinary would have. a gives the illusion that everything will be fine. this is a mind-boggling number. we lost this in the housing market. we could figure out a way to pare back some of this.

we're not encouraging people to take this risk. housing was great for a while. it had a catastrophic collapse. >> as an enemy to interrupt you. regardless of when that happens, it is we have all of these instruments including a document loans and other circumstances. it is certainly not under those circumstances. that is part of creating a bubble. i do not know this is a reason to look at the mortgage. it seems there's long-term

stability for the individual to know what their responsibility is. not necessarily engaging on the market place. there is no down payment. i appreciate your comments. but i do not subscribe. i am increasingly concerned because my dear friend and colleague as someone that has been a real letter. he made a comment on the floor. it is not just the side of the loan. he commented that it has been so difficult the risk is

downside of. it is the least we can do in the difficult. there is this whole issue of what is the downside. it is not 20%. that will eliminate people who can be responsible borrowers. i look at the median single- family home that costs 170,000. and bank of bohol long it'll take for a family earning twice the median.

it seems to me that lending criteria is important. this criteria has 20% down. is that a fair statement? >> lending criteria is one in the tea's that is a major influence. there's a lot of lax credit standards. we ignored some of the rules. this had more of an effect than interest rates. they had set this standard. there are different components that are selling products. credit unions stood by.

they said let's figure out what was best for you. we try to look beyond this. i'm suggesting that was not done on all parts. my written statement i rode through some things that can make them very successful. this the better place to focus this. what makes borrowers really succeed? what makes them responsible? there other things you can do like housing counseling. we helped them get the budget right. there has been a dichotomy. people are getting 30-year

fixes. they do not understand interest- rate markets. people are making this choices -- these choices because the works for them. there should be choices. there is not a product for everyone. other advisers can help them is evaluate those options and make the choices that really fit for their long-term financial plans. >> i would like to thank all of our witnesses for being with us here today. this has been very useful. we continue to explore the system. this is adjourned. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]

>> carl levin in washington tomorrow of the u.s. challenges in afghanistan and pakistan. he can watch his remarks live on our companion network c-span2. tonight the debt and muammar al- gaddafi. weakening from president obama. some of the senate education committee's work on updating

the notion of what the crime law. >> my working relationship was positive. i thought he respected my work and that he trusted my judgment. >> it has been 20 years since she testified on capitol hill. this past weekend she spoke about what that testimony meant and the lasting effect it has had on our culture. >> when you return from a testimony that has become this event that you really had no idea was going to be what it was, i said i walk out on the street.

they did this immediately after the hearing. that 70 aids arm of the population thought i had perjured myself. in addition to the pressures, i had to go to the grocery store. seven out of the 10 people i would encounter thought that i have perjure myself. >> watcher remarks as well as the judiciary committee hearing. it is washington, your way. >> because i am a business. i am very proud.

they have attempted to picture me as an opponent of liberalism. i fought for the reforms of the elderly and woodrow wilson before another roosevelt. he was a member of the democratic party for over 20 years. he saw and won the republican nomination. he left his mark and in political history, speaking out for civil rights. he is one of the 14 men featured in the weekly series. it is friday at 8:00 p.m. eastern. >> the death of gaddafi in the

future of human rights in libya. than heather smith on motivating young people to vote in next year's of election. them what is ahead for the u.s. economy. our guest is kenneth simonson. "washington journal" is like every morning at 7:00 a.m. eastern. the discussion from this morning's "washington journal." >> cynosure charles grassley is on your -- and senator charles grassley is on your screen. what were some of the main points of the recommendations?

they recommended savings on other programs. in finance committee, we did not say you ought to cut money out of this program and that program. we started with eight themes that the committee had. we got to do those things that promote growth,. the whole project is to build confidence in the future. and it is to preserve programs. it can be older than 50. we told older than 55 because

you cannot give them a opportunity to adjust. anything you do with medicare is the same thing. we did not suggest like the house did. we suggested that you ought to have more state authorities so they can try different things to save money and eligibility. very basic principles like increasing the age. almost like everything is on the table. increasing age. we've got to preserve medicare and social security. it is part of the social fabric. when seniors get nervous about

this. they give the opinion that maybe they'll get away. at the same time, if anyone says leave my social security alone or my medicare alone, maybe they will not realize it. they're saying there will not be medicare and less to do something to preserve it. the young people today will only get seven% of benefits. these are the basic premises of what we suggested. it seems like we could not the culture committee has been a bipartisan.

the senate democrats on the finance committee. >> according to the senate finance committee, the recommendations include these. repeals the health care law and the tax increases full repeal of the alternative minimum tax. address the eligibility age and evaluate the supplemental coverage. with medicaid give states the budget and flexibility to modernize its and implement reimbursement systems. we have a caller earlier he

wanted to ask you the question why don't you open it up for younger and healthier people to be able to buy into medicare in order to help support the? it is funding. those people that say why can we have a program just like this. it will probably be a more viable program. it adjusts annually much more than you can suggest medicare. and they bought into medicare today to be the same. why is medicare in trouble today? the average age was about 74 years old.

now to 79 or 80. today we have to make up for the fact that they did not realize cboe would live longer. aeromedical public keep people alive longer. for those things now. but the important thing is that medicare has got to be preserved because it is part of the social fabric of america. host: before we go to calls -- and we have the numbers up there so we can get right to those -- i want to ask you take a separate questions. we talked earlier about rick perry's flat tax proposal, what your thoughts? caller: it is the second -- guest: it is the second-best proposal congress could consider if they want to throw out the existing code. 70 percent of the people -- most congress to not talk about this like the people do, but we all

realize it -- it has become -- and makes our economy very uncompetitive, it stifles individual on it -- initiative and it needs to be thrown out. i would prefer a flat rate income tax. but if you don't have a flat rate income tax i would support a national sales tax. the point is, don't have a sales tax on top of the income tax. it has to be one or the other. host: have you endorsed in the gop primary? guest: no, and i did announce today i am not going to endorse anybody. if your question is, if i will support the nominee, i sure hope i can and i intend to. the reason why i announced, that is, i believe we have some of the good candidates, and quite frankly, it is very difficult for me to choose among them. secondly, i think we have a system in iowa where we make presidents.

president obama would not be president of the united states if he had not beat clinton in iowa. president carter would not have been president had not come to live in iowa a couple of years before he was nominated. so, we make presidents. maybe you can say that about george bush as well because he did well in iowa. since we have a system where the cream tends to come to the top, i think i am going to rely on that system. host: is there any sense -- chance of the january 3 date could move now that nevada is looking to push back their caucus to february? guest: in that case, i don't believe so. because we have to do -- we had to do it because of florida, so let's blame florida first. but we had to move hours from february to january 3. then the question is, can new hampshire, and 10 days or so

after ross and then still time for nevada. if nevada is going to move later in january, i think we are pretty firm at january 3 in iowa. host: muammar gaddafi -- host: what are your thoughts that muammar gaddafi has been captured? guest: wonderful. it seems like is 10 or 15 years before they get convicted of anything. host: we invited senator grassley to talk about the proposals for deficit reduction and his own personal proposals for deficit reduction. we start our calls with john in pennsylvania. a democrat. caller: good morning. i would like to ask if you're still getting the government subsidy on your family farm? guest: yes, that's right. i feel like if i'm going to be a farmer from iowa, i should

participate in the farm program and not be an absentee land owner. i can't share -- i crop share. you pay for half the expenses -- fertilizer and everything that goes into the production of the farm. i get half the crops and so i get half the government payment. corn is $7. the only government payment has been the direct payment. we have very firm recommendations in the farm program for saving $23 billion that we're making recommendations to the debt reduction committee. one of those would be to do away with the $15 billion of direct

payments. if that goes into effect, then charles grassley as a farmer would not get a direct payment. host: silver spring, maryland, peggy. caller: thank you for taking my call. i am independent but i lean more towards the republican party because i am a conservative. i have a few comments and some questions. one is regarding -- farm subsidies. these are the problems. is the write offs that are the promise.

number two, the promise is not social security and medicare. the people who created the system are very smart. the problem is the congressman and senators who have been there forever who are corrupted and are not particularly smart. all they do is spend, spend, spend. host: we got your points. guest: where she suggested we do away with the mortgage deduction -- was she suggesting we do away with the mortgage deduction? that is what makes the tax code so complicated. she is right. with the flat tax, we would do away with all of those and end up with a flat tax. there's some suggestion that you have to have a higher rate. preserve the mortgage deduction and the charitable deduction. if her word of corruption is

violating laws, i hope she knows that i know that if you violate those laws, you're going to go to jail whether you are a congressman or not. host: a few more of the proposals from the senate finance committee. this is what the senate finance republicans have proposed. changes should apply to younger workers. host: senator, tubes conflicting newspaper reports this morning. "the washington post" sang the debt committee was going nowhere and politico said there

were making progress. guest: they have kind of taken a blood oath that they're not going to say too much about what goes in there because they do not want to be negotiating in the press and the do not want the lobbyists in town coming down on them when some rumor gets out. so even in our republican caucuses, it is difficult to get our three members that are on the committee to say exactly what is going on. but they do talk positively about getting a result. they talk positively from the standpoint -- they encourage us to not be -- how would you say it? -- and not accomplishing more than the $1.5 trillion which a diaz simon for right now. -- which has been assigned right now.

this is about 60% of what everybody knows it needs to be done. it put some off into next year. if you want to build confidence, and that is one of the goals of the super committee, then you want to do enough to build confidence, but if you try to do it all at once and don't get it done, then you could do more harm than good. host: we have a tweet from ronald. guest: the reason you would not take that -- we have had the highest tax rates of any country in the world if we were to do that. what does it accomplish if

you're going to have billionaires pay in on every penny they have and they draw out accordingly? then what you accomplish? on a ponzi scheme, in a sense, this is what it is legitimate to call it a ponzi scheme. but i did not use that word. i'm not going to complaint with anybody that does use that word. i drop 100% of benefits out of social security today. but my grandchildren will only draw 70% of benefits. the reason for that is that once the iou's are used up, the law says you cannot pay out what the cash flow is. it is a ponzi scheme when people that are paying in today are not going to get out according to what i get out, compared to what i paid it in my lifetime.

host: republican from iowa -- next call for senator grassley comes from a republican in vista, california, jules. caller: hi there. i'm from iowa originally. guest: when did you leave iowa? caller: 1956. guest: you need to go back to fairfield. caller: i went back about eight years ago. what i saw was it didn't look that prosperous to me. all the factories have closed down.

all the things that i knew as a youngster were pretty much gone. guest: you would be surprised a number of entrepreneurs -- caller: i have to argue with you about that. do you remember a college? do you know what it is now? it looks like a compound. it doesn't like a college anymore. host: what is your question? caller: social security depends on how many people you got paying into it, right? i come from a family of seven. i assume -- i hope there will all pay into social security. if you have one or two children, how do hope to collect? guest: he is bring up a key point.

today, dobie after 2036. today there are about three are-- today, that would be after 2036. it would be worse in the united states if we do not have the legal immigrants coming into this country. and if we did not have some illegal immigrants. i do not like illegal immigration. we're not as bad off as your europe. europe is about 1.3 per family. japan is even less.

china was a tremendous problem. we have people that want to come here and work and be productive and pay taxes, so it is not quite as bad. he brings up an important points. host: we have an e-mail from new jersey. guest: it is a simple matter. when people who of worked for 40 years pay into the system,

they don't have time to adjust. we suggest 55 or even 50, and any changes will start affecting them at that age or younger. if you were 66 today and tomorrow we would change the retirement age to 67, maybe you would quit your job. what are you going to do? you can get social security for another year -- you cannot get social security for another year. caller: i wonder if the senator has any economic predictions. i'm hearing the commercial budget office is predicting unemployment rate will remain 9% for another two years at

least and that economic growth will be anemic 1%, maybe 2%. is the sinner concerned about this -- is the senator concerned about this? guest: i am not an economist. there is some private economists that would say we will have unemployment getting below 8% in 2013, but it will still be relatively high. you have to create a least 150,000 jobs every month so does not get worse.

he says his question, am concerned? yes. that's why i concentrated at the beginning of the program at the what the super committee has to do and what we have to help them do, we have to promote economic growth and have tax policies and regulatory policies and fiscal policies and trade policies that promote economic growth. if this economy does not grow, you're not going to create these jobs. the caller calls and and lot of people are calling in and think, let's put people on the government payroll. hire more teachers. government consumes wealth. you are not going to get economic growth by putting more people on the government payrolls. you have to great private sector jobs. that is where the growth comes.

you have to have competitiveness to do that. that is the tax policies and spending policies that the debt commission is going through. all this build confidence in the future. so i would say to the caller from michigan, one quantitative measure of the fact that government has to create a better competitive environment is the fact that there are $2 trillions in corporate treasuries and they are not making any money on that. it is just sitting there. they want to hire people. they want to build plants and equipment. they're not spending it because

they do not know what government is going to do to them. we have the highest tax increase. we have -- we have 66,000 pages of new regulations out of the administration just this year. we have this big budget deficit that congress is responsible for. all of this overspending and all this consequences of the tax policy coming down the road and the big health-care reform bill, corporations are not hiring because they do not know what congress is going to do to them or what the president is going to do to them. we have to build confidence. we have to say that taxes cannot call when we have a recession. the president said that before he was sworn in. we are expanding our trade. that is a positive thing to do. host: muammar gaddafi dies of wounds in libya.

this is a story from reuters. he was wounded in both legs as he tried to flee in a convoy which nato airplanes attack. guest: is better than an arrest and trial -- it is better than an arrest and trial. this will keep libya from unifying. i believe this will bring about a stronger libya and hopefully a more democratic libya. they will not have him as a ruler for 42 years whether he is behind bars or in some foreign country. maybe we can go back to the pro- gaddafi years. that is what many people are hoping for. host: any thoughts if you were shot by nato airplanes? guest: nato is legally into it based on the u.n. regulations.

if there's any question about whether that's right or wrong, we were involved there under international law legally. france and italy. host: senator grassley is learning this as we're learning this. those are preliminary remarks. we don't want to force him to keep his remarks in case he has other ones later. please go ahead. caller: on social security, president obama this year it has cut fica tax for the employee by 50%. the jobs bill next year cuts the fica tax by 50%.

if you're out on the table bleeding out four pints of blood a minute and you're only in fusing two pints of blood a minute, how long do you think you have to survive? as far as job creation -- host: how was senator grassley killing off social security? caller: he is not. president obama is. you create jobs if you create a demand for the product. you spend all this money by giving tax breaks and anything else you want. until the company has a product to sell, they do not need to hire anybody else.

host: what about the remark that president obama is responsible for killing off social security? guest: i disagree with that. on demand, he is right on that point. president obama's plan and congress, if we go along with it, the amount of money that feet 2% reduction in the payroll tax for one year is going to be taking out of the general fund and put into the social security fund. the total amount of money will remain the same. host: next call, we have about 10 minutes left, elizabeth, new york, frank. caller: good morning. a pleasure to speak with you. there are incentives for large corporations to move jobs to foreign countries.

the reasons for that -- there should be a penalty of some sort for corporation that is doing well here and has built a reputation and made a lot of money in the united states shipping your job and my job to perot, canada, wherever -- to peru. social security under the new deal was never meant to be a primary retirement system. it was meant to be a base, a basic system where you had something when you retired. would you agree that maybe as families and as americans, we're not planning properly?

we're depending too much on what was meant to be a social safety net? we're depending on it to guide us through the long years of our life. guest: he is right on the last point, that people are not saving enough and social security was meant to be one part of a three-part savings plan. it was meant to dovetail in with the second leg for pensions. the third would be personal savings. the extent to which people are not involved in a retirement plan, he is right, they are not saving enough. there is more savings in the past six years than in the past three years before that, but it

is still probably not enough to supplement it. about a third of the people and retirement that get 100% of the retirement from social security. so they did not save beyond that. it is difficult to tell frank in new jersey that if caterpillar is moving eggplant overseas because labor is cheaper and they want to be able to manufacture a better product, that john deere could not do that. thisn't have laws in country that say that if peter, if you retired and you wanted to find a lower tax country to move there, will not pass a law saying you could not move to another country. that is not how we operate in

this country. we believe in political freedom and that is applicable to corporations as well. we could keep more of these corporations in this country if we take care of some problems that we have in this country of white people go overseas. we have the highest corporate tax rate in the world at 35%. even socialist countries are reducing their tax rate to corporations. we have a lawsuit regime in this country than most other countries do not have. manufacturers have to build that cost into the product. tort reform would help. the cost of health insurance programs are expensive. if we do something about that. all the government regulation we have makes it difficult for our manufacturers to be competitive sometimes. inre's a lot we could do this country to make our manufacturing more competitive.

i think you see that in agriculture. we have become competitive in agriculture and that is why our products -- we export about a third of our agricultural products and unfairly competitive basis. host: the deficit reduction committee is looking for $1.4 trillion. the committee must vote on a plan by the wednesday before thanksgiving. host: there are some schools of thought that perhaps it would be the easier way to allow the automatic cuts to take place. guest: it would devastate the defense operations. it would make the united states

very -- all we do through military and the protection it gives to the american people would be hurt if that happened. that is a big reason the committee will come to a recommendation, i believe. host: we have a tweet. guest: no. we're looking for a competitive environment. small business creates 70% of the new jobs in america. much of the people that make more than the $250,000 that the president proposes for a big tax increase at the end of next year are small business people.

small business people create 25% of the jobs in america. so why if you want to get unemployment down what you want a tax employment? that is what you would be doing in the case of small business. it is necessary to follow the rule if you tax something you get less of it. taxdon't want to employment. it is small business operates on cash flow. you increase taxes on small business and it takes money out of cash flow. there will be less money to hire people. corporations can borrow and

float more stock. small businesses don't have the leeway. host: ted in hammond, oregon. caller: this is mr. sweet spot, mr. plummer. we have talked before. let say congratulations to the nato air strike. i'm an old air force veteran. a remember when the f-111 flew to libya to drop bombs on gaddafi's tent. i understand that senator kyl and senator coburn, they are due to retire. when i was in the air force, i would not have to go 20 years for retirement. i guess the base wage of a senator is $175,000 and change a year. democrats and republicans are

due to retire. do you think a senator is worth that much money on a pension? guest: they would have to serve more than 20 years. so kyl and kay bailey hutchison would not qualify for the maximum. coburn was just reelected and he is not going to retire. i didn't know the maximum retirement is $139,000. some people get crazy information of the internet that says, if you served in the congress six years, one term as a senator and you're going to retire at full pay. that is absolutely wrong. should a retirement of

congressman and every federal employee be changed to some degree? everything should be on the table when it comes to deficit reduction. host: last call for senator grassley, from albany, new york. lynn. caller: good morning. i want to ask two questions. one is about the flat tax. my concern is that businesses take deductions for salaried employees. the ceo's making $30 million a year annually -- that is a business expense that is written off. is that adjusted or businesses going to continue to be allowed to deduct salaries that are outrageous?

guest: the flat tax is on personal sales at the retail level. so whenever the national sales tax is, that is -- no. she is talking about the income- tax. i'm sorry. the flat tax -- there would not be any deductions except for personal -- like for a family of four, the first $35,000 would be deductible. the flat tax applies to personal income. it would not affect the corporate tax. you could have a -- we're talking about individual tax. the corporate tax would not be affected if we have a flat tax individual.

you are wrong about the 13,000, if a ceo gets paid $13,000. the tax law allows $1.5 million to be deducted as a corporate expense. that was put in in 1993 with the idea that would limit corporations from paying their ceo's $30 million, as you suggested. it did not stop us because they found other ways of getting around it. -- of paying their ceo's $13 million. we will pay them a lot more even if we cannot deduct it. or we will give them the ability to buy stock at a low rate. it is impossible sometimes to

necessarily accomplish what you want to. we thought we were accomplishing no ceo getting paid more than $1.5 million. but sometimes they are worth more than $1.5 million and we have to happen to protect the work force we have and to protect the stockholders host:. senator chuck grassley was just reelected with 65% of the i will vote -- of the i will vote. -- of the iowa vote. guest: i have to move to the next committee i was most senior in. i am the first non lawyer to be ranking member of the do this year committee.

host: to seize personal proposal or the agriculture committee's proposals to the debt commission, you can go to is website, grassley.senate.gov. thank you for being on the "washington journal." guest: they will find more recommendations. there's a lot of ways we can save specific amounts of money. . >> then heather smith on motivating them people to vote and a discussion on major economic indicators of what is ahead for the u.s. economy. our guest is william caustic -- bostic. "washington journal" is live

every day on c-span at 7:00 a.m. eastern. >> my working relationship was positive. i have a good deal of responsibility and and attendance. i thought

look for the entire weekend schedule online at book tv.org >> senate armed services committee chairman carl levin speaks tomorrow about the challenges in afghanistan and pakistan. you can watch that live on our companion network, a c-