the numbers, some po lls show up to 70% of the public is aghast at what is going on. the flip side of that is this is why we currently have a very cheap internet that is very accessible. the public outrage kind of surprised me. host: matt laso, thank you for sharing your expertise. we're back tomorrow morning with c-span's "washington journal." 7:00 a.m. eastern time. we will continue our conversation about the issue of religion and politics. next week, we will be live all week from iowa as we get ready for the iowa caucuses on tuesday, january 3, the new hampshire for the new hampshire primary -- then new hampshire for the new hampshire

primary. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] the clerk: the speaker's rooms, washington, d.c. december 21, 2011. i hereby appoint the honorable michael g. fitzpatrick to act as speaker pro tempore on this day. signed, john a. boehner, speaker of the house of representatives. the speaker pro tempore: the prayer will be offered by the guest chaplain, reverend michael wilker, lutheran church of the reformation, washington, d.c. the chaplain: let us pray. gracious god, you give us light in the darkness. we praise you for the galaxies, stars, planets, and moon that shine in the night. we bless you for lamps and candles that ill lieu min our communities. we thank you for the fires that warm our homes and energize our work.

we repent for the ways we pollute the beauty of the night, the ways we extinguish the light of companionship, the ways we fail to share your warmth. enlighten our darkness. be the day spring for those suffering from addiction and illness. be the bright morning star for those who are grieving. be the sun of justice for those living under oppression and in poverty. be the cleansing fire for those who survive violence and warfare. traveling send us with your light to share with friends and strangers. welcoming light our gatherings with your love. searching for justice and peace , light our way. amen. the speaker pro tempore: pursuant to section 3-a of house resolution 493, the journal of the last day's proceedings is approved.

the pledge of allegiance will be led by the gentleman from maryland, mr. van hollen. mr. van hollen: thank you, mr. speaker. i pledge allegiance to the flag of the united states of america and to the republic for which it stands, one nation under god, indivisible, with liberty and justice for all. the speaker pro tempore: pursuant to section 3-b of house resolution 493, the house stands adjourned until 10:00 a.m. on friday -- >> mr. speaker. mr. speaker -- mr. speaker, we would like to ask unanimous consent that we bring up the bill to extend the tax cut for 160 million americans as you walk off the floor, mr. speaker. you're walking out. you're walking away just as so many republicans have walked away from middle class taxpayers. the unemployed. and very frankly as well from those who will be seeking medical assistance from their doctors, 48 million senior

citizens. we regret, mr. speaker, that you have walked off the platform without addressing the issue of critical importance to this country. and that is the continuation of the middle class tax cut, the continuation of unemployment benefits for those that risk of losing them, and the continuation of access to doctors for all those 48 million seniors who rely on them daily for their health. and i am pleased to yield to my friend, mr. van hollen.

>> john boehner named conferees should perry decide to call the senate back for more work on the measure. he said he will not do that. congressional lawmakers have left washington for the winter holiday and the white house will not say whether president obama will join his family in hawaii for the holidays. we are live for the carnegie endowment for international peace in washington where they are holding a discussion on the global economic outlook and we will hear from several economists about the u.s. economic recovery, the european debt crisis, and the chinese recovery. >> the singer a service id at the carnegie endowment -- the

senior associate in the carnegie endowment. he was also the director for russia which is an unimportant world bank quiet. to my left, yet another world bank veteran, peter botilia who is a professor and an associate of the carnegie endowment and also in the beijing office of the world bank. let me kick this session off with some brief remarks on the 2011 record. particularly on the crisis of the which is so central. -- euro zone which is so central. 2011 was a disappointment from

the slowing of the fast pace of 2010 and because it leaves the advanced countries well below the pre-recession trend. 2011 was not a disaster either. growth in the world was in line with the 10-year pre-crisis average because emerging markets continue to power ahead. they slowed around midyear. moreover, although the u.s. economy grew at half the rate of 2010, in 2011, it has recovered and read gathered some steam. after the summer lull. the u.s. corporate sector is in good financial shape and judging by the events of the last 24 hours, in much better shape than

the u.s. political system. however, 2011 is also the year that the bureau crisis became deeper and deeper. with its early now engulfed in it, it represents a qualitatively different level of risk in the global economy. greece, ireland, portugal, and spain sought gdp decline in the third quarter. their combined debt, government debt that is, is $4.60 trillion. that is three times the entire subprime mortgage market in the united states at the peak. the italian bond yield, the 10- year bond yield, is at 6.8%, an entirely unsustainable level.

most economists agree that the crisis will be with us for many years and also agree on the shape of the long term solutions that we must have. these include a fiscal union which should include jointly issued bonds, eurobonds, it must include tight fiscal discipline and austerity and structural reforms that make the periphery more competitive. most economists also agreed that these reforms will take years. you need a bazooka to help the periphery defend itself from markets in the meanwhile. this bazooka can take the form of a combination of a bigger

european financial stability fund, imf and large and, and the ecb support for the banks which it is now doing big time and to sovereign's in trouble when necessary. the essence of the current stalemate in europe and its inadequate policy response is that there is no agreement either on how the burden of adjustment will be shared in the short term nor is there trust that in the long term, a fiscal union will not turn into a transfer union from the north to the south. on the other hand, everyone is aware that we all lose a lot if no solution is found. the big losers will include of course the periphery of europe but also germany, the u.k.,

which is in the eu but not in the euro zone, including the united states which is europe's biggest external creditor and with home europe is the largest export market and for similar reasons it will include china. even in good circumstances, europe is likely to see a shallow recession, indeed one that has probably already begun. this is in fact the baseline that most people are working off of. however, in the worst circumstances, a breakup of the euro will slow the continent and possibly the whole world into a multi-year depression. i personally am not at all sure that the europeans can handle the problem on their own not just because of their political divisions but because economically the problem has

become too big for the healthy core of europe to handle. for that reason, i have argued for imf enlargement supported by all its members beginning with the united states and china has a badly needed insurance policy. that is my introduction on the 2011 and euro crisis. now would like to kick off a conversation in the panel and i have encouraged them to disagree with each other, disagree with ourselves, among ourselves. and to comment as we go along. i will direct the first question hans stimmer and ask him how he sees the outlook for the advanced countries in 2012

and how what might affect emerging markets. i will then move on to talk more specifically about china. hans -- >> first of all, thank you for inviting me. it is always nice to have the opportunity to exchange views and i hope we can disagree. you said that 2011 was not a disaster but indeed it was very disappointing. we are preparing at the moment our global economic prospects that we will publish four weeks from now. almost without exception, the growth rate this year are lower for countries. it will be a lower growth into 2013. it has a lot to do with what happened in europe and the crisis which i see as the second phase of the financial crisis of 2008.

many european countries have entered recession. that is spreading to other countries but also there are other disappointments. first of all, the disruption of the global production network after the tsunami and earthquake in japan was much better than earlier anticipated. you see that very much in japan but also in the united states. secondly, in some of the emerging economies you see the impact of the tightening of the policy that was necessary because several of those countries were close to overheating and the tightening has slowed those economies like brazil, india, and turkey to some extent and perhaps china in the coming months more than earlier anticipated. it is very difficult to interpret the short term dynamics. you mentioned good news but i

would not be too optimistic about that sometimes you see the rebound from a disappointment earlier. you had the sharp decline in production in japan and the united states in the spring after the tsunami and earthquake, disruption in the car industry and you saw a rebound and in august, the rebound stopped because of the downgrade of the u.s. and now it is coming back again a little bit. if you take the year as a whole, it is not that good and not as good as we anticipated. if you look at the forecast, that has really deteriorated given what is happening in europe at the moment. >> do you want to say something, hans, about emerging markets, defects in particular about the european and american uncertain says on the emerging markets? >> there are three defects

already observable, i would argue, coming out of europe. first of all, the infrastructure in europe has collapsed and that has an impact on exports including china. numerically it is not the most important one anymore. it used to be very important but it is a observable. the second channel that you already can see in the data is that capital flows to developing countries have slowed down and to some extent you see a reversal of capital flows as a result of deleveraging in the european banking system. especially the eastern european countries are vulnerable to that. you also see an impact of the general spread of uncertainty especially intensified after august across the emerging countries.

you see stockmarkets coming down, you see weakness in currencies, and that has an impact on the sentiment in those countries. because of what you said at the beginning, it is the emerging markets that are driving the global economy, we are very much focused on what is happening in the domestic markets of the emerging economies and you see weakness there. >> let me pick that up on the domestic situation let me begin by asking you how you see the challenges in china domestically and how it affects the international situation in china. >> it is very easy to disagree about china. i find it very easy to disagree with myself at times. i want to begin by giving a couple of quotations because everyone is talking about whether we will hit a soft or hard landing.

"there is no easy way to avoid the bus that is coming in china. "the new york times" -- the china story sounds too much like the crack of we have seen elsewhere. here is "bloomberg" two weeks ago surveying its commercial banks -- 60% of them foresee a financial crisis coming in china in the next few years. there is a lot of rebel sources who believe that china is in for a hard landing. look at the statistics which have come out in the last week or two. industrial production grew at 12.4% in november. that was pretty good but then that was 1% below october. invest and grow by 21% in november but that is the lowest rate since january.

exports grew at 13.8% in november and that was 2% lower than last month. the china trade surplus was $14.5 billion in november, a very large amount but that was only half of what it was in july. depending upon whether you read the positive or negative number, you would think the chinese are doing pretty well are pretty poorly. most estimates are that the chinese court this year will be somewhere between 9.1% and 9.3% and next year it will gravitate to something like 8.5%. that is a common projection. that is a soft landing. it is actually a good growth rate which is more sustainable and a rate that china should gravitate towards over the next few years. they are actually above their

potential in the past. it declined at 1.5% in chinese gross of that is a good thing although many people write about it as a bad thing. that is a soft landing. what is a hard landing? that might be a growth rate that goes to 5% or 6%. what is a collapse? a collapse is not a negative rate. might be 2-3%. what is the potential for a collapse or a hard landing? most people see it in the property market. let me talk about why there is a huge variation in terms of how people look at the property market in china. investment in property have soared to 12% of gdp.

the presumption is that this must be a sign of a bubble or collapse. it is comparable to the fact that the chinese investment rate went from 30% to 45% over 10 years. people think this is not sustainable, evidence of a collapse. the number of units which are vacant in china, 16-64 million vacant units in china, makes people think there is a bubble out there. if you look at those numbers, you think there is a bubble. there is a problem in evaluating the demand in china. it is 50% urban, 50% rural in china but is much less urbanized than you would expect. there is a potential of 200 million families moving to the urban areas in the next 5-10 years. 60% of the chinese housing stock is sub standard, too small.

there is also a huge lake and potential demand coming up. they want to build 800,000 affordable housing units over the next three years. it has the financing and will go ahead. we don't know how much of this is affordable housing in how that will compensate for the potential reduction in commercial housing. what is the likely property bubble in china? the property bubble in china is not the normal property bubble we see elsewhere. it will be a property bubble with chinese characteristics. [applause] [laughter] this is not a sector that is highly leveraged. households have strong balance sheet. property investments and all the associated investment is very expensive. there's construction, decoration, insurance and all sorts of activity associated with the 12% property development.

a slowdown and the property sector will lead to a slowdown in a growth rate in china and that will have an impact next year of going to 8%. how will it go lower? supposed trade in the bureau's own really collapses -- eurozone really collapses? it could fall by 1% by itself because of a deterioration in the european situation and that would bring it down to 7%. if the property bubble got more expensive and pervasive in the economy and affordable housing dries up, maybe down to 6%. the elements of a hard landing are possible in the coming years but probably unlikely. the collapse scenario i would say is highly unlikely that is because you have very strong balance sheets and the fact that you have low performing loan

ratios. the government stepped in with state bank city will not see the kind of financial collapse you might see elsewhere. reserve levels are very high. the budget is running a significant amount of surplus with revenues pouring into china. all this means that the government has flexibility in dealing with a potential downhill slide. >> thanks a lot. that is a fairly reassuring picture. do you agree about the domestic challenges of china? >> the most important domestic challenges i see and i agree with most of what was said, are to deal with the fairly drastic slowdown in overall economic growth.

the different perspective on the chinese situation -- one camp interprets this slowdown as the beginning of the end. china will now run out of rope and unavoidably run into a hard landing. that is the view expressed by "the wall street journal." another view which is more my view is that it is a challenging and difficult situation. you have a fairly competent group managing the situation in beijing that are not panicking. they feel they can keep this monster under control. they can use it to their advantage to promote these economic changes that are at the center of their current five- year development plan. the economic rebalancing has moved more sensibly on the policy agenda because they have

no choice. the slowdown which is a broad based slowdown is hardly in -- domestically engineer. the government was concerned about the property baubles in 2009-2010 and set out to deliberately killed up bubble by managing it. they try to do what alan greenspan said. you cannot control a bubble but the attendees have completely -- but the chinese have a completely different perspective. since they began to introduce all sorts of administrative restrictions on the ability of households and companies to buy apartments since april of last year, this is showing off the property market. it has cooled down. the difficulty is to know by how much and what prices are really doing.

the worst that could happen is a precipitous price climb across the board in our urban china. if that happens, over a relatively short period, you will see a lot of bankruptcy's with developers and they will pull the bankruptcy is in the construction industry and the thousands of supplier industries of the construction materials. that has not happened so far. it could happen and if that happens it will be bad because that would be hard to stop. my sense is that beijing feels comfortable that they can keep this under control. their first line of defense would not be to be open the monetary spigots as they did in 2009. their first line of defense, if they fear a precipitous price decline in the property sector would be to undo some of the administrative restrictions on how purchasing was introduced.

the two largest cities have decided that they will not do that, they will keep these administrative restrictions in place. that suggests that they are not worried about a price decline. , at least not yet. since that is the most important domestically- engineered source of the slowdown, i feel that china going into a hard landing is -- has a limited chance. look at the external side, mostly european and american demand for chinese exports. european demand has dropped sharply but exports are still growing on the whole. they still have a large trade surplus, smaller than a few months ago, but still large.

for 2011, they expect a trade surplus of $150 billion compared to $185 billion last year. they will have deferred a much stronger export picture than they are confronting now but, again, i don't see any panic. they allow companies that are affected by the slowdown in exports to go bankrupt. there are hundreds of bankruptcies and beijing has allowed that to happen. there is a strong sense that there's an opportunity to push industrial restructuring to higher value added production which is in the long term interest. they are allowing this to happen and allowing the growth to come down and the economic committee

in beijing concluded that the main priority remains domestic stability and that can be achieved by a proven monetary policy and a corrective fiscal policy. if they are going to prevent the growth rate from falling too far, they will use fiscal means which is a very important policy difference from what they did in 2009 when the emphasis was strongly on monetary expansion. on that score, without being totally confident in my own predictions, i am inclined to think that those who feel beijing will be able to keep this under control and present a hard landing, they are likely to be right. >>hans, you obviously followed

china among others. i am interested in your reactions to this but also your quantitative idea -- how serious would a big slowdown in china before asia and the rest of the world -- a domestically induced slowdown? >> the question is not so much whether china will collapse. for me the more important question is whether the situation and the world economy deteriorates, china can play the same positive role as it did after 2008. you have to think through a more negative scenario. you cannot exclude a deeper crisis. then we are empty-handed many countries. in rich countries, you don't have fiscal space anymore and you hardly have monetary space. many of the other developing

countries, the fiscal situation has deteriorated. after 2008, china put a floor in the free fall of the of world production by stimulating their economy. they cannot do that in the same way they did in 2000 a precise the because of what peter said. at that time it was done through the banking sector by creating a lot of credit and liquidity. you cannot replicate that. that is very dangerous because it creates a lot of liquidity in chattel banking. they don't want to do that. the alternative is that you have real fiscal stimulus which is indeed a better way to do it. can that be as effective and as large as what we are seeing in 2008. that is where i am not completely sure. i see china as more like other countries, reaching some of the limits of counter acting

possible downside scenarios that you have to think through. the issue is not so much that china will likely achieve negative growth rates because you can have a real crisis in china with small positive growth rates. it is quite possible that a lot of the financial stability would be based on growth rates of 9% and if you create non-performing loans and inadequacy in the capital base of banks, then you are right -- the government can step down. you can have financial tensions in china with low growth rate. >> just like everywhere else, the message is that the safety net, so to speak, of policy in china has also eroded.

that makes containing the euro crisis even more important. my question may be -- how does china of view the european crisis now? should china help europe? will it help europe? >> let me make one comment first. if you look at china, suppose its growth goes from 8% and goes down to five or six or seven. in some ways, it is a big domestic economy. it is not trade depended as other countries are. people think it is an export- driven economy but it is not.

similar countries like south korea and taiwan and the philippines and malaysia and singapore have been expecting to get 40% increases in exports to china in the last few years. they are quite trade and export dependant, more than people realize. if there is a dramatic decline in china and growth slows down to 6 or 7% and they have these financial problems, it can properly manage it. there is a ripple effect on other neighboring countries in east asia. that as a secondary a fact. we don't know with the totality of the effect will be on the world. that is worth pondering. in the euro is done, europe is extremely important to china.

europe is china's largest trading partner, $480 billion in trade last year. europe is china's largest export debt nation, more than the united states. china gets a tremendous a priority in europe because it sees it as a hedge. the success cannot just depend on the united states of china is interested in a strong europe and will try to help, in my view. the statements coming out of- region, china or negative or tentative. the average person in beijing, one guy said he does not understand. why should china use its hard- earned savings to help lazy people in europe whose incomes are 10 times mine.

that is the dominant view in china. the government is hard pressed to explain to people what it means to help europe and why is it -- is -- it is in china's interest to help. under the right conditions, like a friend or where the europeans are taking the bulk of the responsibility and helping themselves, a framework which is globally agreed upon, a framework in which the u.s. is involved either an explicitly or implicitly which is not discussed too much publicly today -- china will participate. the imf vehicle is the most logical one for them. it gives a greater assurance and spread the burden around. it gives you a multilateral voice which is what they want. under the right circumstances, china will help out and cannot afford not to. europe is too big to fail. >> peter, what do you think?

>> i agree with much of that. i think china would wish to assist in the rescue for the euro situation if they knew how. after the last summit in brussels, mr. klaus regling was sent to asia to explore the potential relationship of beijing and tokyo in particular and explore how they might support it. the first port of call was basing any was received very well by the minister of finance. he left for tokyo without a press release. evidently, the objective of these discussions was to see how

willing the chinese would be to support the leveraging of the european stability fund from 440 billion euro to 1 trillion euro. the chinese or realized that bureau problem is not a financial problem. it is a political problem between north and south. by making available hundreds of billions of dollars, china cannot solve the political dimensions of these problems. nonetheless, my sense is that under the right circumstances, the chinese would race to support your because europe is important to china. in our u.s.-centered world, we don't realize. europe is a more intricate -- important trading partner than the u.s. and is an important source for technical assistance

which almost all the member countries in the european union have technical assistance programs which is not possible on the congressional side of the u.s.. the mosts also important source for new technologies to china. that may surprise many in the audience. all the matters is the reason to the u.s. -- to china as the u.s. relationship. that is not true. ultimately they realize it is a regional political problem. they have the financial means to come in in a big way. if there were to come in which is highly uncertain, most probably they would do it through the imf. i think everybody is encouraging the chinese to think in those terms. if in addition the chinese would wish to purchase equity and

european banks or direct investment in european companies, they would do get directly. they could use a two-pronged approach guest: . >> when your found itself in terrible trouble after the summit of october 27, president sarkozy of france picked up the phone to president hu jintao of china to ask for financial support. he did not call president obama. he called president hu jintao. and my reading too much into this? does this market change -- marked a change in global international relations? is this the beginning of a new

era? would any of you want to pick this up? hans? >> i think we are already in a new era. to go back to the slowdown in china, you should not think lightly about the impact of a slowdown in china. it is not so much because of the domestic health of countries but because of the effect on the rest of the world. the role depends on the chinese investor. when gdp slows down a couple percentage points, that investment will slow down more. it has enormous consequences for the rest of the world and a high income countries. economic importance of china is already very significant. to your question on china and europe, there are three reasons for china to support europe.

first of all, they are a big economic player. they will help to prevent a collapse of the rule of the economy. if that is needed to prevent the collapse of europe, that is one reason for them to help. they want a broader international financial system and one that is just based on the dollar. over the last five years, they have diversified away from the dollar into the bureau. it makes a lot of sense to support the euro but have a more balanced system in the international financial markets. thirdly, it is a way to get a seat at the table for them. that is indeed what i agree about. they want to see something back for playing this through the imf. i think that is very helpful

that this enormous economic power will have a bigger seats. as for the progress is slow. the established high-income countries are not bad willing to give them a little more space. >> good. >> i think china is in an awkward position. the sarkozy phone call recognizes that china is becoming a global financial power and should be involved in these financial issues. from the chinese perspective, it is kind of embarrassing that they are being placed in such a focal point and do not like to be drawn into a role where they are playing a role. they really want to be part of the group. there would like to play a more active role they have not sorted out the way to do that and the way the system would support their political philosophies. i think the sarkozy appealed generated negative feelings

across europe. it gave a sense that china might want conditionality and what the form of condition would be? the form of this would not be in the same form as we know. they feel when they provide assistance is between friends and friends basically help friends. they are looking for something from europe in a way that would help them in terms of their standing in the global community. >> zpeter? >> the global shift is happening in as a result of the current situation. china is at the center of the east. it is by far the largest

economy that will become increasingly prominent in the global economy. this is a painful shift for the western countries because it is happening today. legendaryr. sarkozy's phone call is an illustration of the reality of the power shifts of the financials. if you look at it from a global perspective, you might call the current situation the first crisis of globalization. in terms of production, there has been a significant shift from the west to the east. the east now accounts for 55% of cost total global output which is still not accounted for more than 44% of global consumption. most of the consumption is still

in the west and the production has shifted to the east. that is according to gordon brown. sorting out these production imbalances globally is the challenge facing the global economy. >> before i open it up for questions from the audience, i have one last question. it is about china-u.s. relations. we have this turning of europe to what is china, we also have the pivot of the united states announcing that theapec meeting in hawaii. it seems like everybody is pivoting. [laughter] towards asia. -- towards china to a degree.

how do you read the state of u.s.-china relations? there is a tired dispute and a debate about automotive imports. what are the risks for china coming from the u.s.-china international political and economic aspects. >> let me start with your pettitte. the european pet is a broadly welcomed the bite china. they see giving europe more n as a positive thing. tensions have arisen between the u.s. and china.

they are not quite sure what that means that a military says. this has a different perception within china. this is an election year here coming up. there is the transfer of power in china to the next generation of leadership next year. these political events will complicate what i would call the financial-economic discussion. it starts with the anti-currency bills which china feels negative about it and it shows up in trade beset -- trade protectionist action on both sides. the terrace on thev-8 engines going into china is being looked at negatively on the hill. china sees this as a tit-for- tat. it's the same thing with jenna

bush exporting tires to the u.s.. -- is the same thing with china exporting tires to the u.s. chicken feed to account for $300 million of exports to china. they are useless in the united states. china is trying to restrict those. john is looking for examples of things -- china is looking for things to hi cant at but not big issues. they are concerned that many negative things which emerged during this heated political process in china and the united states will cloud what i would call the natural trade relations between the two countries. where trade is a big issue today, the technology transfer,

the tensions which are showing up in that area are more important in the future. the solyndra solar panel case and to what extent is being subsidized and what extent is china subsidizing the development of green technology in china? the fall out i think will be a big issue. not only are many u.s. companies suffering but you will probably see 60% of the capacity of charm of being wiped out this coming year. it is a problem that aggravates producers and governments of both sides. they will say is a problem shared rather than one side or the other. >> china-u.s. relations? >> i think both sides realize

how incredibly important these but -- this financial relationship is. it is not a subject on which a claim to have a lot of expertise. it is obvious that the relationship is not only extremely important but extremely stressful. it is stressful because there is a bakes' -- basic lack of trust between the two giants. one of the biggest victims of the 2008 financial crisis i fear, is chinese respect for the american economic system and in particular the financial system. that is hard to measure. it is important because there has been a subtle shift in chinese perceptions of the united states prior to the crisis. that was never explosively expressed.

the american economic model was the chinese model. china feels their model is not so bad after all. maybe they have already done enough in terms of economic reforms. that is a very dangerous conclusion if it persists and takes hold of the decision- making process of the top leadership. i am still hopeful that is not the case. during my recent visit to beijing last week, i was actually a pleasantly surprised by how many people kept stressing the need for further financial sector reforms. that was a surprise to me. another encouraging element is that prior to my visit, you have fairly high level discussions in beijing. add to the american announcement that they would go forward with arms deliveries to tie one in

the beginning of the year, the chinese reaction was to let's cool it on the relationship. i believe that has to be a physical part of the relationship. fortunately, for reasons i don't understand, the situation moves in a positive direction and were helpful in beijing prior to my visit last week. >> i don't have anything to add? >> the trade frictions with disgust and the discussion on the currency illustrate that the rise of china is not smooth. the fact that the united states has to give up some of its dominance is not the smoothest of processes. looking forward, that can become worse. it can go into more areas with

more and more chinese companies wanting to invest in the united states which would be very natural process. there are other potential sources for disputes. if the chinese are competing more directly with u.s. companies, you have more friction. if china becomes more dominant in the financial markets, you have more conflict. at the same time, we should not overemphasize the importance of the bilateral relationship between china and u.s.. sometimes we think that is the only thing that matters. that is not true. we're moving towards a multi- country level. the importance of developing countries outside china is more important than all -- and

looking it all counties together. it is important for china not to kids into focus on only as relations with the united states. they have to think about the relation with the other emerging countries. >> excellent, i would like to open it up to the audience, please. introduce yourselves, affiliation, name, before you ask the question. the gentleman there in the middle. - >> thank you. >> please stand up and tell us who you are. >> thank you for organizing this time the event. i am with the chinese news agency. recently, if britain is reluctant to give its share to

the 200 bureaus, european countries have not got the $200 billion euros for that prized. in china, a step in our step out for this particular time -- as for the united states, due to the strong opposition from republican senators, the have not given the 108 billion euros. for countries like mexico and china, they have their cost and benefit analysis. is not related to the voting share. this is my first question and secondly, there are differences among the important players for countries like germany going to

to the general resources. for countries like the united states, they want money going to special accounts to reduce the contagion across the imf membership. how should countries seldom given problems. >> good questions. let me take a couple more and we will come back. after that, the gentleman who just stood up. >> thank you, with the the world affairs council. the panel basically things that a hard landing is unlikely in china but if there is a hard landing what would be the political impact on china? you already talked a bit about a lot of bankruptcies and with

bankers is would come a lot of this is ad people, as time about heavy-handed activities in china of various kinds. would we see some political ferment in china? >> and then the gentleman who had stood up before? >> i am retired. when i see the topic you have chosen, global economic outlook, a wonder whether you can really? clued countries like brazil and india. you mentioned the multi-global development. i am wondering whether you can ignore them. i was also surprised that you did not at all, not once, mention employment.

in the united states, there is no doubt that the next election will be heavily influenced by the quite significant unemployment. how come you did not mention employment patterns and changes because they are so important? >> let's take these three questions in reverse order. i will ask hans to answer the gentleman and pieter will talk about politics and i will give a stab at the euro question. >> i could not agree more with the last question. we were able to discuss -- and mentioned the slowdown in brazil and india.

is an important phenomenon in both countries for the global economy. we see a sharp slowdown in the past four months due to a large extent to domestic policies and their reaction to a very sharp increase in domestic demand in the period before. those are independent developments that interact with the rest of the world economy but should be considered when we're doing our global economic prospects. the unemployment issue is also important. even broader. we're talking about the high- income countries. we're not talking about a normal downturn or recession. there is a fundamental problem in the problems of a lack of growth.

it you need fundamental changes to come out of this situation. we're talking about the fact that it will take many years before you undo the damage that was done in 2008. by itself it was a problem. it takes many years and it takes reforms. the political system is not ready to take those steps. that is a difficult problem. if you look at the middle east, you have your link with unemployment and a link with structural changes also. there's a lot that should be thought about. >> economics and politics in china. >> the papers are full of discussion of this issue. a fishing village where 13,000

residents are protesting and the top leadership is trying to negotiate a fair outcome. this is indicative of a large increase of social unrest in china. it would make things worse if there was a hard landing. if you ask about the economic factories which are likely to impinge upon politically related sensitivities, i would cite a couple. there is an example of the battle over land rights and how land is used and developed and tax and who owns it. a major issue and they have not been able to deal with this. this is a source of tension in china. what would happen if we had a collapse over disparities?

the disparities in china are spatial in nature. it is not like what it is in the united states, singapore, and malaysia. the urban and rural -- 3.5%, the highest in the world. that is how you deal with this. the third issue has to deal with the social protection programs in china. are they going to be strong enough? the social protection programs in china are not as strong as they should be. if you have a collapse, you have to ask whether it will increase the tension. the answer is it will. if incomes collapse, you'll have some problems with locality and

with everyone. it depends on who will be hit most by that. i think the social programs are in a state of development there. >> thank you. pieter? >> on the question of social unrest becoming more political and in response to it hard landing, it is important to realize there is social unrest in china today. it is rising. how much of that social unrest is political in nature is hard to ascertain. my sense is that most social unrest is focused on local grievances. local pollution programs and things like that. if the rate were to drop to a

hard landing situation, 5% or so, it is likely that social unrest would intensify in china and it would assume a more political nature. i do not know what happened after that. this government has been able to maintain high growth. social unrest is on the rise. the microblogging is surely on one hand a source of greater grievances because they can be more easily share. but it is also a safety valve on the system. people can now express themselves more safely through the internet. it is hard to say. my sense is that china is politically stable, much more

stable than most people's realize. >> let me take a stab at the euro question. i think it is good news is that they have committed to wonder million dollars -- $200 million to increase imf general resources. i think that's the good news. the u.k. has not set that they will not contribute. they have said they will consider a contribution early in the new year and they would prefer to do that in the context of a broader g-20 initiative. the u.k. is a little bit the odd man out at the moment in europe for all the reasons that you have been falling.

indeed, the u.s. congress is undergoing difficulty -- difficult debate on the previous expansion of imf resources. i am among the very small number of people who are daring to propose that in the event of an escalation of the european crisis that would set the stability of the system -- increased imf resources should be directed to europe and that requires a u.s. contribution as well as chinese contribution. there are very few takers on this view, but i guess that is

why i work in a think-tank. [laughter] i am paid to think. if italy cannot repay the debt, that is the united states' problem as well as germany's problem. that is the view that i maintain. i think the chinese will be following the same logic. there was a big coordination problem. but in the end, you cannot say we will -- that just does not make any sense. >> i work for the state department. i would like to ask a geopolitical question that connects with everything you have been talking about.

china has looked internally for enemies or potential problems. with the recent death of kim jong il, the huge energy resources pouring into asia which they see as some of it was the threat -- as a quasi-threat. how is china going to react? they have a huge domestic problems. we're kind of shaking them with what they see as a potential circumvented, but it does appear that we have to circumvent policy. how do think the chinese leadership when the deal with this and the military says come the americans are redesigning the security architect in the region. how are you going to respond to that?

i think a huge battle will take place. the chinese will go through the leadership change as well. i think it is extremely sensitive. >> we will come back to that and take a couple more. the lady in the back and i will come to you, as well. >> thank you. i'm with a newspaper in china. you said china should provide financial assistance if the conditions are right. one of the conditions should be that the u.s. should also contribute. the u.s. government is reluctant to even talk about the possibility of providing resources. a few members raised their

eyebrows even before this issue becomes a fully engaging issue in the congress. do you think now is the time for the u.s. to consider providing financial assistance to european countries? thank you. >> the answer is yes. allegis said -- i just said it. >> molly williamson. thank you for this viable presentation. u.s. china-relationship around two vehicles -- thank you for this valuable presentation. energy and the environment. the united states and china are the number one and number two producers of energy. can we work together in the

disposition to see things in more competitive rather than cooperative terms of the other other ways to work together? >> maybe we will take one more and come back to the panel. there is a hand in the back. yeah. >> thank you very much. i'm wondering if the panel could comment on chinese bilateral engagement with individual european countries, specific lead on the peripheral -- specifically on the periphery. how'd you see this affect the overall eu policy towards china, maybe in the areas of human rights?

how d.c. european high- technology transfers -- how do you see european high-technology transfers? is it too early to see them at jumping the gun? i think this was an issue with chinese-eu relations in the past. thank you very much. >> maybe pieter, you want to start us off on the geopolitical situation, u.s.- china, the pivot, etc. how do you see that? >> it is an area of great concern to the united states and the whole world. the global shifts about which we are speaking are also reflected

in strategic changes in the strategic equations. you mentioned some of them. i'm not so sure that the chinese know exactly where they are heading them sales. i think they'll put claims at have expressed deep worries about the american presence in dublin. whether they are as worried about that seem to suggest i do not know. only 30 years ago, these questions were outside the radar screen of even the most senior chinese. nobody gave it any thought. we should be careful not to jump to conclusions about china's attitudes on these changing patterns. my sense is that's they wish to

become a global power and they wish to be not only a global economic power but also eight military power, at least a strong regional military power. that poses a challenge for the u.s. it will take a lot of wisdom to deal with these challenges. channeling these energies in a stable direction. these challenges are facing china as they are facing the u.s. >> i would add a few things. this is a tough issue for china. they see the pivot as increasing tensions in the region. they see the privet is something they inadvertently encouraged, because they took it hard line over the past several years. i figure the government is

realizing that the best way to deal with this in the military security issues is to try to soften their image in the region. otherwise there would encourage more of these tensions. particularly in a year when china is going through a leadership change, they do not want to see more stress. the longer term depends on what the u.s. reaction is and the priorities of the chinese government. on climate change, to make it is interesting. we have a a heated debate about climate change in the united states. there is not a heated debate in china on this. there state council is 95% technocrats.

they don't have a personal opinion. the united states, the leadership is not a scientists. they'd like to debate a lot of things. they are hung up on these issues of whether targets should be treated the same as developed countries. there is a course of strong commitment in the united states. there should be ways to collaborate. the technology aspect is likely to continue to be developed here. the broad based manufacturing aspect are likely to be done in china. is there a potential for a relationship? yes, there is. apple. everythingchnology --

is developed in this country. apple products are manufactured in china. that is a win-win. that is the same issue as climate change technology. both sides feel like they are gaining something out of this. the u.s. does not feel they are gaining the necessary share to make this a true partnership. >> i would like to follow up on the climate change issue and help you achieve more cooperation to solve the global problems and to provide the the gogoods. or cooperation between the high-

income countries. i think what is needed is that there will be a fundamental change in the dynamic of the process. the process has always been that the high-income countries, they come up with a global solution and they give it to developing countries and they say, that has too much or the characteristics of this is of interest to high- income countries. i'm not interested and it is your problem, so thank you very much. you have the same kind of a dynamics. countries are thinking globally and then trying to push a in three other countries. what has to change is the countries have to start thinking globally, think about the global problem from a vested interest of developing

countries, which have to grow, and put that on the table. the high-income countries should start reacting to that. what you saw in durban was a small step in that direction. china was much more committed than before, and so the developing countries are able to think through as part of the global solution and then you change the dynamics. but we're not there yet. many developing countries did not have -- have not found their voice yet to think globally, and the high-income countries are not ready to be on the receiving end. >> does anybody want to pick up on the european investments,

what the europeans want? >> what is the chinese relationship to individual european countries, in addition to their relationship with brussels. my sense is that the chinese are playing both sides and they have active relationships with the major european countries. and with the european institutions in brussels, there is it high-level strategic dialogue between brussels and beijing which precedes the strategic dialogue between the nine states and china by quite a long time -- between the united states and china. the dialogue was started at a high level by secretary paulson

in the w. bush administration. europe is very important from china's perspective and an important source of new technologies. that comes from brussels, which is a large program for china and also from the individual member countries. >> other questions. this gentleman in the middle. >> i just got back from two weeks in beijing. i had a lot to do with younger people. i heard dissent. they were expressing irritation on the controls put on them on internet and news and various things. i wonder if the panel has a view if that is an exception or

something new happening in the country. >> the lady there. melissa. >> thank you very much. i have a comment. we have seen a tremendous shift of power is how will the government has been able to deal with some money issues. we see the risks of trade increasing. to what extent do thing the coming elections will spill into protectionist reaction. the success of the system that people did nothing would perform so well. we've seen a tremendous crisis in the mockeries -- in

democracies dealing with the big structural change because of a population and the fiscal crisis. when do you think the west will get real about dealing with these things? the focus has been on the short term, two to four years. what is going to take before this happens? >> the last question was related to china, right -- or was it more broadly? >> we have china doing very well. we're seeing democracies having lots of trouble with things that have to be done to deal with the fall of the financial crisis in a much more competitive economy. we see a lack of reality in

washington and europe in dealing with this issue. what is going to take for this to sink in? >> good. there was a lady there. > i'm market pearson -- margaret pearson from the university of maryland. your assertion about a coronation problem. we have heard a tremendous evidence that there seems to be a coordination problem. everybody thinks that the europeans and the banks and there is a major source of solutions. at the same time, the u.s. needs to step been, the chinese need to step in. imf seems to be sitting back and

waiting for europe to be the central motivator for this as well. looking for a sliver of hope about how these coordination problems can get solved. if europeans go to great extent then they have so far to solve the problem -- where is this initiative going to come from beyond the europeans doing what they need to do to get the multi lateral and the great power cord nation in as well? it is a process question. >> we have a question on protests and on the internet, and we have a question about protectionism in china. we have other questions. yukon, you want to -- >> on the use issue and the

concerns about the restrictions on the internet and the individual rights. we have to realize this is the generation has no direct contact -- contact or context of the cultural revolution and the aftermath in terms of -- basically saying excesses' have to be dealt with very hard because of the promise. they do not see that as a necessary aspect of their country. so the government coming down much harder it will increase. it will increase because the employment opportunities are getting more serious in upcoming years. i would say the university crowd

is getting restless. >> good. protectionism, the risk of protectionism under the new government. pieter? would make a difference -- will and make a difference? -- will ence?make a differ >> how the government will change and the policies on trade. it is hard to predict at this time. you'll have a wholesale change at the politburo level at the opening of the congress sometime in the fall of 2012. if anybody feels confident predicting what impact it'll have, i am not one of those. i came away from my most recent visit, and the people i talk to

are keenly aware of the open trade channels in china. they would like to have -- we saw the duties on certain vehicles, trucks and issue tsuv's. i'm inclined to think that is not so important. to go for an open trading system as much as they can and from wto membership and any other country. few people are engaging that question that. yes, there will be trade frictions, particularly with the united states. i would expect china to open up even further. >> hans, do you want to take a

stab at the second question, the reforms that are needed to reflect this big global change and why they are not happening? ink it to some of the other questions. to some extent, there are structural changes also. it would be important -- it is a coordination problem. not everybody agrees with that. some say the problem with europe is too much coordination and you don't have the flexibility to do your own stuff and to react in your own weight to your own problems -- in your own way. i believe it is a fundamental

problem. there to integrated -- they are too integrated to deal with the problems. you have to rescue banks and you have to supervise banks, and that is still done at an individual country level and that creates fiscal problems in many problems that then have to be solved and goes back to the banking sector. it is difficult to get court nation because there are different interests in different countries. -- it is difficult to get coordination. ultimately the european parliament understands that the only solution is to have certain issues more organized. europe is now ahead of the united states because in europe, at least both for the european

union, steps are taken to solve those longer-term issues. if you look at individual companies like italy and portugal, if you look at the reforms they are implementing at the moment, you have these long term elements in there, and that its ultimate what is needed. the discussion is about now an it is map based on a vision of where you want to bay -- and it is and not based on a vision where you want to be. the inability of governments to deal with that. i think pieter said it already. that is not just a problem when there are adversities. in china, you have the educated

people that now are in a different way educated than even 10 years ago. in china you have the emerging middle class that wants to have a say. in the middle east, it was not just poverty. people came out of college but could not get a job. it is difficult to do what the consequences of progress. the ultimate example you see in the high-income countries where you have a lot of progress but the politics is no longer able to take the next step and so your stuck. >> good. on the euro question, the process, as you asked -- i think the first step of the process

has made progress in the last week for two. the first step of the process is the europeans have put in a significant additional chunk of change. the european central bank has stepped up its support to the banking system, issuing three- year loans. it is less demanding collateral requirements. this is part of the safety net. everybody knows that the european central bank is acting at the moment to stabilize the bond market, and for good reasons. there is no explicit policy on that in order to maintain

pressure on the country's in the prairie. so i think the first step is there -- to maintain pressure on countries on the periphery. there was a serious discussion that took place. the message from the last meeting of the g-20 was that the europeans have to get their house in order. they have to come up with a credible plan and they have to put money on the table. i don't think they have done that to the extent that they should. to be frank, i doubt whenever things you put in place that you'll get a large involvement outside of europe, unless the

united states is in the lead. so, you place your bets. how might it happen/ ? unfortunately, in my happen under dress -- it might happen under duress. there was a financial panic and it was accepted by the congress a week later. that kind of circumstance may develop. then the treasury's around the world will be on the phone to each other and the key senators will be called, etc. then the situation might change. i do not know. i do believe it is unlikely that large package will be negotiated without the u.s.

involved. i think we will take one more round. the lady there. >> thank you. i am with china central television washington bureau. in recent months, we see the economic indicators -- housing data and also the gdp figure that is prone to be released tomorrow will probably be a positive. can we take these as signs of economic recovery? you mentioned the upcoming presidential campaign next year.

what should the government make the most in order to prop the economy? >> we will take one more and turned over to the panel. i'll ask them to make any final 30-second interventions. >> i fall op with her question and would like to link some other points. we talk about global. the test on the europe, asia market -- you touched on the euro, asian markets. will you touched on the issue -- the approach of the -- how china will react to that? it is related to energy and jobs and employment and the question about the economy.

how you see the future investment of china in the u.s. at manufacturers and creating jobs in this country? >> that is a large number of questions. i will ask you to pick a couple of them, yukon and pieter. do youst, hans, want to comment on the united states and give us your 30- second parting message? >> the positive news in recent days in the united states is good news because it shows that the u.s. is not sliding into recession. it is not good news because now all the problems are over. this is kind of a rebound that comes after a weak first half year. you should look at it in

cyclical terms and almost the technical changes, but not as an administration where problems have been solved. the investment in the housing sector is still 1 divided by stories below where was before the crash -- is still 1/3. you get a recovery from restructuring the economy and we are far from that. i'm seeing it in a positive way, but i'm still worried about the other countries including the united states -- high-income countries. my last 30 seconds is very much in line with the question about all the other events in the world. i'm surprised that in these discussions, we never touched on africa. if you look ahead, then there

are fascinating developments in africa. many countries are growing 6% a year. many countries have seen the fundamental reforms in their economy. it is a continent that is rich in resources and can benefit from the chinese interest. 10 years from now, we will look back and say, something happened in africa. we did not talk about latin america at the moment. the situation is fundamentally different from what it was 10 years ago and they play a different role in the global economy. that means for me that in these discussions we are still too much focus on what is happening in the high-income countries. but the world is getting bigger and bigger. >> thank you, hans. >> a quick comment about these regional agreements.

whether it is east asia or whatever as you go -- it is getting confusion. they have overlapping responsibilities whether on trade or financial responsibility. i think there will be some shaking out over how much is overlap or increases the focus. they have some views -- some of these things are not working out the way they would like. the objectives i think are sensible ones. i find it hard to see how you can go at those objectives without china's precipitation -- participation. what is not a grouping that we are not asked to be encouraged.

the security issues of that region. the last comment i would make -- china's links are important to china. it is very much in favor of an open economy. it wants to increase the capital flow. the big issue for china is how to increase the flow out to establish a more direct relationships. you have to encourage more money to flow out of china, and it should. look at the former soviet union. he saw the soviet currency collapsed -- you saw the soviet

currency collapsed. they realize it made sense to diversify their holdings. eight reshaping the portfolios which changed the value in the future -- a reshaping of the portfolios. >> 30 seconds. answer to those questions. take your pick. >> the global economic outlook is extraordinarily concerned and complex at this point. the three major economic pillars -- the united states, europe, and china are all facing very difficult conditions. if the u.s. is unable to come to terms with the fiscal issues facing this country, it is hard to be optimistic about the

longer-term outlook. if europeans cannot come up with a plausible solution, to the heart to be optimistic about europe -- it is hard to be optimistic. china is the least troublesome of the three. the economy is still growing very fast. all the layoffs in the manufacturing sector we are observing don't translate into higher levels of unemployment. china's real wages in manufacturing are still rising. this is still like fast-growing economy despite the slowdown, which is broad based and has been going on for the last 12 months and will continue for the next 12 months. i don't want to discount the risks. i cannot assess the political risks. i think china will be able to

manage a slowdown in such a way that they will benefit in economically structuring -- we see the imbalance is coming down. the surplus is unlikely to be higher than about 3% this year. the domestic consumption growth rate -- the data suggests that the extreme imbalance between china's share of consumption in gdp of the lowest in the world -- household consumption has been growing faster than gdp. that is what is needed to bring about some restoration. the big concern is that the leadership change that is coming

a new teamnth' months -- will make big mistakes. if china begins to make big mistakes in their policy framework, then all bets are off. nothing guarantees china's success. >> my 30 seconds is to resonate with hans. this is to a washington audience now. hans said the world is getting bigger. so this is one message. the world is getting bigger with china, with the multiplicity in emerging markets. that is a huge opportunity for the united states.

in many ways, the united states is the economy best positioned to capitalize on these plans. its openness to foreign cultures, its establishment of the rules under which the global economy operates. but there are big risks in the world. the world is getting bigger. some of the foreign risks are getting bigger. none arbiter in my view -- 9 are bigger in my view -- none are bigger in my view. politicians need to be aware of the risks coming from overseas. it is remarkable to me just how insular the policy debates and

how concentrated on the micro questions the policy debate has become in the city and how little awareness there is. this is from the global superpower of the risks that are out there and the opportunities. so i will leave it at that. i would like to think on behalf of carnegie and on behalf of all of you, the panel i think today terrific job. to a very much -- grass just very muthank you very much. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]

>> the congressional battle over the payroll tax cut continues today. the house is not in session. today's session took a turn as steny hoyer came to the floor requesting a unanimous consent agreement with republicans to bring up the payroll tax bill. here's what happened this morning when he was asked to be recognized by the chair. the clerk: the speaker's rooms, washington, d.c. december 21, 2011.

i hereby appoint the honorable michael g. fitzpatrick to act as speaker pro tempore on this day. signed, john a. boehner, speaker of the house of representatives. the speaker pro tempore: the prayer will be offered by the guest chaplain, reverend michael wilker, lutheran church of the reformation, washington, d.c. the chaplain: let us pray. gracious god, you give us light in the darkness. we praise you for the galaxies, stars, planets, and moon that shine in the night. we bless you for lamps and candles that ill lieu min our communities. we thank you for the fires that warm our homes and energize our work. we repent for the ways we pollute the beauty of the night, the ways we extinguish the light of companionship, the ways we fail to share your warmth. enlighten our darkness.

be the day spring for those suffering from addiction and illness. be the brightorning star for the who are grieving. be the sun of justice for those living under oppression and in poverty. be the cleansing fire for those who survive vience and warfare. traveling send us with your light to share with friends and strangers. welcoming light our gatherings with your love. searching for justice and peace , light our way. amen. the speaker pro tempore: pursuant to section 3-a of house resolution 493, the journal of the last day's proceedings is approved. the pledge of allegiance will be led by the gentleman from maryland, mr. van hollen. mr. van hollen: thank you, mr. speaker. i pledge allegiance to the flag of the united states of america and to the republic for which it stands, one nation under god, indivisible, with liberty and justice for all.

the speaker pro tempore: pursuant to section 3-b of house resolution 493, the house stands adjourned until0:00 a.m. on friday -- >> mr. speaker. mr. speaker -- mr. speaker, we would like to ask unanimous consent that we bring up the bill to extend the tax cut for 160 million americans as you walk off the floor, mr. speaker. you're walking out. you're walking away just as so many republicans have walked away from middle class taxpayers. the unemployed. and very frankly as well from those who will be seeking medical assistance from their doctors, 48 million senior citizens. we regret, mr. speaker, that you have walked off the platform witho addressing the issuof critical importance to this country. and that is the continuation of the middle class tax cut, the continuation of unemployment

benefits for those that risk of losing them, and the continuation of access to doctors for all those 48 million seniors who rely on them daily for their health. and i am pleased to yield to my friend, mr. van hollen. >> something rarely seen in the house session. even a member to speak on recognize on the floor. the house is out of session. the tv calorie and the video and audio feed on the floor -- the tv feed and video and audio -- he spoke for another 23 minutes. the next pro forma session is this coming friday and we will have live coverage for your here on c-span.

congressman steny hoyer held a briefing with reporters in the capital to talk about what happened. this is about 50 minutes. -- this is about 15 minutes. >> we participated on the floor of the house to place on the floor and to pass legislation which would give certainty and assurance to seniors, to the unemployed, and to 160 million americans who are at risk of losing their tax cut on january 1, the ability to of that confidence and not just on this holiday pudu but in january and february.

try to come to an agreement on the extension that we want. unfortunately, as has happened so often, the acting speaker, republican presiding officer, walked out. he walked out and would not render recognition and would not allow mr. van hollen and i to make that request and to move forward. this is unfortunate. the speaker has indicated that he is ready to go to conference. he appointed five conferees, all of whom have said that they are opposed to a one-year extension of the middle class tax cut. he made comments similar to the speakers that the tax cut is a gimmick. the middle class does not believe that. they don't believe it it is a

gimmick to reject having the wealthiest in america paid additional increment so that this bill could have passed in the senate months ago. i regret that the republicans who say they are here to work -- we're on the floor to do our work, and they walked out. no one to yield to mr. van hollen, the ranking member of the budget committee. >> thank you, mr. hoyer. as you saw, the presiding officer brought the house of representatives into session and gaveled it to a close before giving us an opportunity to ask for unanimous consent to take up a bill that is identical to the senate bipartisan compromise bill to extend the payroll tax cuts. the speaker of the house and the

republican leadership were awo l. i didn't see any of them. the speaker can walk down this hall and we can enter into it unanimous consent agreement to take up the republican compromise bill. it is right here. we can vote on this today. we would get the same bipartisan result that they receive in the senate the other day. by the end of today, we could have a bill on the president's desk that would make sure that 160 million americans would receive a tax cut and that millions of americans looking for a job but cannot find one have unemployment insurance, and we can make sure that millions of americans will still be assured that their doctors will be paid. these are medicare patients. there will make sure their

doctors will be available because they will be receiving payments under the medicare system, full payment. it is a tragedy that the house republican leadership did not show up today on the floor of the house of representatives. we could've gotten this bill passed. they may be on the floor of the capital. we'll be here every day waiting for them to come to the floor of the house to take up this legislation so we can get it done. >> there were here every single day on the floor, but they are there.

>> your premise that our democrats would not be here is wrong. we were there to ask that the house take up a unanimous consent request. they walked out on us. the acting speaker walked out. they walked out yesterday when we were all here. senator mccain, "the wall street snow, l" -- senators senator lugar have all said to pass this bill.

a clear lesson of the financial crisis with the need to bolster and the quantity of financial systems, harmonizing dogdd- frank is one of the principal challenges face -- we face. since the july hearing we have issued a number of proposed rules required under the dog- franc act on credit risk retention, margin and capital for covered swap incentives. staff is carefully evaluating the thousands of comments

received on these proposed rule making and are now actively engaged in considering the many issues raised. more recently and after months of intensive study and analysis the sec jointly publish the volcker rule. in some recent months, much has been accomplished. we will continue to move forward to complete the many projects under way. i am happy to reenter your questions. thank you. i would like to thank all of the witnesses for their testimony. as we begin questions, i would ask the clerk to put five minutes on the clock for each member. secretary lull, how would you

describe the european crisis. as the situation in europe regrate -- . the core elements of dog frank were designed to build a stronger, more resilient financial system, one that is less prone to crisis was the hon. to stress. in europe underscores the importance of moving for with more documentation to make sure appropriate capital cushions and other financial standards

because we thought the country was in crisis. we acted, and as a result of that action, in my opinion, we avoided a depression. unfortunately we still had a deep recession, which we're still suffering from. we're still pulling ourselves out of that. the fact of the matter is we have been their time and time again to act in a biased make sureassifashion to this government and country remained stable and successful. >> the other point is there were not divided in the senate. there were not divided. you had 80% of the republican senators' support this payroll tax cut, so the real question is, why is it the house

republicans are so divided from the senate republicans and the senate democrats and house democrats in terms of getting something done? that is the question facing the house of representatives. any answer is any clear from the past couple of days, which is you have an extreme right-wing element that has hijacked the process, and that is why they refuse to even bring up the bipartisan senate bill for an up or down vote, because they were afraid they would get the same bipartisan result of the house as they got in the senate. they are afraid of bipartisanship, and the reason is they have this very right- wing elements. let's also remember the house republican leadership was supposed to apparel tax cut. two months, three months, one year. the record is full of statements where they were opposed to it. their action the other day by

refusing to take up the senate compromise bill and sending this bill off the dock was intended to accomplish what they wanted to accomplish in the beginning, which was to have no payroll tax cut. the reason we went to the floor today is to give them another opportunity to do that. it is absolutely the case that the speaker of the house and republican leadership could have come down to the floor today. they could have entered into unanimous agreement to take up this bill, which is identical to the senate compromise bill, and we could have gone this done today, and the american people could go to sleep tonight knowing that she refers they would have a payroll tax cut, and unemployed americans know they could still put food on the table, and doctors would know they would continue to be paid. let me just add to what mr.

van hollins said. nhollan said. >> there is a bipartisan agreement. it was voted on overwhelmingly. it was the republican leadership in the senate that blocked a vote on the house republican bill in the senate. and >> levy adds, if i can to your question -- >> let me add, if i can come to your question. not only is there an agreement by the overwhelming majority of the united states senate, the american public overwhelmingly agrees. poll after poll shows they think we should get this done. it is not simply the tea party controls conference over here disagrees with the united states senate, they are not representing the views of the american people.

the compromises that have been appointed of all oppose that one point or another the extension of the tax cut. this is a device, a gimmick, a political trade to pretend support for something that they have historically over the past year opposed. >> following up from a while ago, you said democrats want politics to end here. republicans have said the same. with all respect, this is the second conference we have attended in the past hour, so why is it your still pulling partisan gimmicks? with all respect. >> with all respect, this is democracy. we are saying that we believe very important we should pass

what the senate, no dog and pony show, overwhelming bipartisan support. let me answer the question. >> they know there will not be a conference committee. all of this seems like game playing at a time when both sides are calling for the games to end. >> we're not playing a game. we're prepared to have this bill come back and pass it. we can do it today. that is not a game. none of the 48 million americans that are concerned about continuing access to their doctors think it is a game. none of the folks that are on unemployment that are relying on the employment to feed themselves think this is a game. this is not a game. why are you all here? why are we able now to communicate with the american public?

because we went to the floor. we went to the floor to speak to the american people and to the members of the house of representatives. unfortunately the speaker walked off -- the speaker pro temp walk . alked off we are here on very serious business. no games. that is what senator mccain was talking about. that is what senator brown is talking about here again that is what senator olympia snowe is talking about. they are talking about get this work done. unfortunately i can name you 12 instances that i have on a list here where the republicans have walked away from solving serious problems. this is not a game. thank you.

>> that briefing from about 10:30 this morning. not long before this, but the house speaker held a meeting with republican leaders to discuss the full-year tax cut they're calling for. we caught them before the meeting. >> good morning, everyone. yesterday the house voted to reject the senate bill come and ask for a conference with the senate where we could resolve differences i have appointed the eight men and women sitting here. we're ready to go to work. we're hoping that senate democrats will appoint negotiators to come to the table and resolve differences. and i think it is important to note that the president, a bipartisan leaders in the house and in the senate, have all

really ask for the same thing over the course of the past several months. let's extend the pay roll tax cut, and all we're asking for is to get the senate members over here to work with us to resolve our differences so we can do what everybody wants to do, extend the payroll tax credit for the next year. >> good morning. the speaker said we're here in washington working today because we want to mixture and the working class families have some certainty that their taxes will not go up for the entirety of next year. that is the house position. frankly that is only issue with which we differ with the senate. we're asking for the senate majority leaders to a point people to come join us to try to finish the work for the american people before the end of the year.

, people are sitting there across america scratching their heads wondering what washington is doing. by the very back of the president said -- it's probably a mile away from here. we're sitting here. people are wondering why they just can't get together and work this out. the differences between us are not very great. all of this indicates is that people want to have a tax certainty for the year. we can do this. we have time, let's get to work. >> we just want the president to ask them to come to the table to work out the tax relief they need. we will deal with the unemployment issue as well. and we do not need to take this

down and then come right back to the same place and at the same argument. we would like to get together and work these things out in the senate and move forward with something that has lasting certainty for the marketplace, workers from a position. >> , from georgia. georgia.rom >> we call on senator reid to appoint conferees said we can get together and work out the differences. i can tell you know medical practice works in two-month blocks. they plan surgical procedures out months in advance. unless we get along for amount of time extended, as well as the position payment, patients will not be able to see their

doctors. we have to get back to work. >> there is enough time to get this thing done, that is for sure. coming from a state that have had 38 months of double-digit unemployment, it is more than just extended unemployment benefits, it is about jobs. take a look at spectrum. could have hundreds of thousands of jobs created with a spectrum policy that i think is bipartisan on both sides of capitol hill. the last thing that is important is to mixture positions are compensated for treating medicare eligible individuals. there is enough time to get this done between now and the first of the year. >> a thank you. -- thank you.

as a nurse i am concerned about the dock experience i know how important it is that doctors have the certainty, but also our seniors sunday know they can continue to get good medicare benefits. we have to do that. as a mom i care about the single moms that are going to be depending on this tax extension we cannot take money out of their pockets right now, especially around the holidays. let's give them certainty as well. take a day camp from michigan. -- >> dave camp from michigan. i think we should call this the matter and ask them to appoint conferees so we can get to work so we do not we people who were

depending on these important things in the air. >> i am a doctor and daughter of elderly parents who depend on medicare benefits. i have been a small employer. i was on the radio this morning in the hudson valley, and one of them was pointed out to me that it would be very difficult to manage the payroll with the two- month extension. so keep fighting. this is why we're there. and we're determined to do the right thing for the american people. this is about doing what is right. no one thinks that two months is enough time to get the extension. we're here to make that happen. >> i think the american public is tired of business as usual in washington.

we are willing to work through the holidays to make sure that happens. mr. president, senate democrats, second. do your job first. >> , read from new york. i have an 11 and 13-year-old for that home and would love to be with them for the holidays. -- tom reid. this bill is just that, reckless policy. and the american people deserve as to be at the table getting our work done. that is what we're going to do. that is why our colleagues are here. we will stand strong until the end of the year to get this done

for the american people. >> you were talking about the importance of the conference committee. i have often heard here in washington that the process is part of the argument. >> we are here and ready to work. we are ready for our counterparts to sit down with us so we can do whatever one wants, and that is to it than the payroll tax cuts. browno what about scott his as you are playing politics? -- >> what about scott brown and others who say you are playing politics? >> the senate only produced a two-month bill. the process is to sit down and work out differences. >> [inaudible]

>> we are the party to lower taxes for the american people. we have fought for lower taxes for the 21 years i have been in the senate. we will continue to be the party of low or taxes. the fact is we can resolve these differences between the parties. and give the american people are real christmas present. -- a real christmas present. it would be helpful if them members of the senate, both parties were here to sit down and resolve differences as quickly as possible. >> are you open to the idea of a two-month extension if you had a guaranteed vote on -- >> we are here to do the work. it is time for our senate counterparts to do the same.

we're here ready to do our work. >> [inaudible] >> i do not think that is in the best interest of the country. we have ample time to get this done. thank you. >> we will get more on that tax cut extension still made during this afternoon's white house briefing that is expected to get under way shortly. we will have a life for you when it starts here on c-span. until then, your phone calls from this morning's "washington journal" on congress's approval rating, which is right around 11%.

i think the house needs to vote on the senate bill. it was the overwhelming majority of republicans and democrat to extend it so they can iron out differences. i am tired of the stalling tactics of the republican party. >> tom on the republican line. what is your take? >> yesterday i was a little upset about speaker banoehner

stalling, but now it makes sense. the president needs to call harry reid back to washington and tell them to do their job. no wonder congress as a low approval rating. they need to stop fighting and get something done for the people. he and the present are trying to get political capital out of this, and i think it will backfire. >> jackie from dallas, texas, on the republican line. >> i think the senate should do what they are doing. the senate originally wanted the one-year tax cut extended. the republicans did not want that. everything the republicans asked for, the senate gave it to them. now all of a sudden the speaker and republicans are saying we need you to come back and do our

job. what good is it going to be for a committee? they have the super a committee and nothing could get resolved. they have the debt ceiling and nothing could get resolved. -- they had the super 8 committee, and nothing could get resolved. i think sometimes the democrats are standing up. they have tried to work with republicans and work with republicans, but now they are in hot water behind this, and now they want to blame it on the democrats. >> headlines from "the washington times." the house voted to enter negotiations over the payroll tax cut. the top democrat refused to bring back the senate before the new year. phil joining us on the republican line from boston. >> party republicans are doing exactly what they are elected to

do. they are the 11% approved in congress. they are the 89% of the old boys' club are the ones that have to change. we need term limits. since the mid-1960s and the advent of the great society, our debt limit is 70 + times. the money is all gone, folks. things have to change, and the tea party is leading the way. >> obama blaming the gop, and the speaker says the president must help out. a lot to share with you from the floor of the house yesterday, including this exchange from the leaders of the house. stanley a lawyer and erick kanter from virginia. -- steny hoyer, and eric cantor. >> , mr. speaker, i respond to

the gentleman, we sent out a note to all members. our intention is for the conferees to do their work. we have requested the senate do the same so we can iron out differences so we can afford a year-long tax relief for the working people of this country. [applause] >> i understand the majority leader's position, but did not answer my question as to whether his members intend to go home this afternoon. >> i will say to the gentleman it is very clear. i know he will the same piece of paper i am, and it reflects the electronic message that went out to all members. the gorgeous some of the exchanges of the parliamentary process back and forth. -- >> just some of the exchanges

of the parliamentary process back and forth. meanwhile, from the editorial pages, there is this -- the senate silent night. harry reid is on vacation instead of negotiating the apparel tax holiday period. all is dark on the senate side. the house voted simultaneously on tuesday to disagree with the senate two-month extension legislation for the payroll tax holiday.

he went on to say -- apparently plenty of others felt the same way, sappers emerged at 6:45 on monday to say the meeting would break up in five minutes, but the republicans impromptu movie night did not end until 8:17 p.m. when the was orange.ce host: cathy joins us from harbor springs, michigan. welcome to the conversation. acaller: i do not know if i

heard you right, but here we read has left town. the case, that is completely unacceptable. -- i do not know if i heard you're right, but harry reid has left town, it that is the case, that is completely unacceptable. this will propel people to get the job done. it should be, because most americans do. and get the american people a stronger voice, because as it is working right now, it seems like we're grinding through the same thing day after day year after year. i live next door to a single parents. she is the primary caregiver. she is working christmas eve and christmas day at walgreen's. that is pretty tough work.

i expect congress to do the right thing by the american people and do not go home until something is passed. host: thank you for the conversation. you can also join us online at c-span.org. viewer saying from a yes, it is that an all-time low because they do not care. frank joins us from germantown, maryland. good morning. er: the way i see this as the democrat-controlled senate and republican-controlled house. both parties are trying to get the best deal they can. the senate will not vote on the house bill, and the senate bill -- in the house will not vote on

the senate bill. the senate bill is really not bipartisan, because senators cannot vote against a tax decrease, so they have to vote for it, but they know house republicans will turn the bill down and force them to go into mediation. having the senate to say you have to take on, except the senate proposal, and now we are in a deadlock or harry reid -- where harry reid says i am not going to come to the table. i think harry reid has back and sell into the corner because he says he will not negotiate. either he has to go back against his word or we're stuck in a catch-22. host: thank you for the call. all of this dating back to last year when the president will

work the payroll tax from 6.2 b to 4.2. this is the money to fund at social security. the issue is whether the cable tax will increase on june reversed. jen says the larger issue is whether it the social security rate will ever be returned to 6.2%. major garrett has a piece available online at the nationaljournal.com. he summarizes it this way. here is what he says could have been -- falling prey to the temptation to use savings from overseas

contingency operations. or number four, senate democrats get in and house republicans stick to their guns and harry reid relents, or #five the house backs down as house republicans gave entirely in past the two-month tax cut extension next week. the probability of that is 5%. you can read more from his piece on line at nationa ljournal.com. richard joins us from maryland. caller: i have a couple of questions about the e-mail you just read about there being a funded program. i want to reiterate it is not a funding program, it is the spending program. also i have a question about congress with the legislation they have been passing with the patriot act that takes away all of our freedoms. that is probably why congress

approval rating is so low. thank you. host: thank you. more from the house yesterday and john was from the atlanta, ga. area. -- john lewis. >> what is happening here today is simple, a disgrace, and real, it is unbelievable. we could do better. -- unreal. if we fail today, how will you faced or neighbor, family who are suffering? is your compassion? where is your heart? where is your soul? host: family motion on the house floor yesterday whether you want to describe it as limbo or standoff or stalemate, it continues on this wednesday, a couple of days before christmas. many of the waning and on the facebook page.

a couple of you were saying can we fire them all? another viewer writes who is the 11% side anyway? that is referring to the gallup poll indicating only 11% of those questioned approved the job congress is doing. and he joins us and the and diego. independent line. good morning. caller: actually i am a republican. i think if you include the senate as part of the 11%, it is probably that low. i would remind listeners that the last election republicans won big-time in every area, primarily because president obama was on the ticket with them. and i have some money thoughts about this, it is hard to put into words.

i like the debate in like that there are two parties in this country. -- and like that there are two parties in this country. i hope the democrats state in the senate. just like the president is a weak leader, so is harry reid. i think the senate is primarily at fault. we won the election, president obama said elections have consequences. this is one. i like the debate actually. thank you. host: thank you from the call. from stephen boyd, this, an comment -- democrats line, great on the phone from denver. good morning. caller: i thought basically is that the republican party has

offered the pipeline. they have that in there. now that they have went out and killed the legislation, how will they get back the pipeline in there if they're not going to take care of the middle class? i think they overshot the target and are looking for someone to blame. as herman cain says, blame yourself. host: there is a story in "the politico." there is a photograph of daryl hannah as she was arrested on this issue. her role in drawing media attention to what was then a little-known proposed 70 mile oil pipeline also help republicans focus on a single energy issue to use against the president as he shifted it to reelection mode, culminated with the inclusion this month at the controversial rider in the house senate-passed bill to extend the payroll tax cut. more on this story at

politico.com. steve on the independent line. caller: if you get a chance, can you pull up the wall street atll street journal" about what republicans are up to. by the way, i cannot think congress seen up for the best reality show on tv that i saw it yesterday. it was just amazing. it was a gift that i really wanted. the real problem is the gerrymandered district. the guy standing behind john boehner is the benefactor. a they redrew the districts, and they are worse than they were before. that is a huge problem. we do not respect the

communities. they created a commission here in california because of the census, and we are worse off now. jim costas has a solid district and kevin mccarthy gets a solid district, and the people who want real representation have a community dissected. if you look at bakersfield, there is a huge alleyway cut of the middle of it. i think one thing that needs to happen is to look in which the way these districts are drawn, if they were drawn up to respect communities like here in the central valley and reasonably drawn. bakersfield has democratic stronghold and republican strongholds. "washington journal" every morning at 7:00 a.m.

eastern. here is the white house briefing. >> good morning. before i get started, i would like to read to you -- here we go, a readout of the president's calls with the house speaker and majority leader. today the president made a separate phone calls to speaker and majority leader harry reid. reinforce his commitment to extend the payroll tax cut, and the fact of the bipartisan compromise that has the entire senate is the only option to ensure middle-class families are not hit with a tax hike in 10 in gives both sides the time needed.

the president also spoke with leader reid and applauded him the work he did to have a bipartisan compromise that passed the senate overwhelmingly on sunday and secured a commitment to have a year-long tax that after the house passes the two-month extension. the president urged the speaker to allow a vote on the one compromise -- >> did you mean the senate? to go the president urged the speaker to allow a vote on the one that -- compromise that democrats and republicans passed together to be -- give the american people the assurance they need that they will not see a significant tax hike in just 10 days. this call took place within the last half hour. >> did you get an answer from either one?

>> that is the extent of what i have. >> [inaudible] >> the compromise exists. it is embodied in the senate bill that was supported by 90 percent said of the united states senate, republicans and democrats alike. it is available, even now, for the house to vote on. unfortunately so far house leadership has refused to allow the house of representatives to vote on that measure, which has overwhelming bipartisan support. we urge the house leadership to reconsider that position to allow the senate bill to come up coming to allow the house of representatives to vote on it, because we're confident that it would pass with democratic and

republican support. and i know you all are aware, because many of you have been reporting on the growing chorus of republicans who are calling on the speaker, and house leadership to do the right thing and passed a bipartisan compromise so americans do not have their taxes go up in 10 days, 11 hours. that is the result in failing to act, taxes go up. the bipartisan compromise exists. it was worked out by the democratic leader and republican leader. the process that was agreed upon with the speaker of the house that produced a result of the speaker of the house pulled his own membership he supported and recommended they support. they should just get it done, and then we can all come a senate, and house and

administration work on extending the payroll tax cut for the entire year, a commitment the president has made from the beginning when he was the first to put on the table a payroll tax cut extension for 2012. but we have to get the two-month extension done or taxes will go up on the american people. it really is not that difficult. the house has the ability to call up the senate for and moveon, passed it it on. taxes will not go up. the average american family will not have to worry about how to make ends meet with $1,000 less next year. that is what the president urged the senate to do just moments ago. >> would white house and congressional democrats be willing to give some ironclad commitment to pass the full

year tax extension by a certain date early in 2012 in exchange for passing this? >> the president is committed to a one-year tax cut. that is what he has been pushing, but here in washington and around the country, some timber as part of the american jobs act, and then when it was separated out from the american stop act. -- american jobs act. it can be done. it would require finishing the work that senators mcconnell and started as they tried to reach a year-long commitment, which is why they did to the two-year extension to insure americans did not have taxes go up. that is the sensible thing to

do, past the two-month extension and return to work on the year- long expansion, or else explain to the american people why congress would not listen to them, when not listen to the house republicans, senate colleagues, not listen to republican older statesmen and states women all around the country and city telling them to do the right thing. it is bad for the country, and bad for the economy and the american people not to pass this bill. we feel very strongly about it as you can tell. >> does the president expect to hear back from the speaker on whether this might be an option? >> i think it is pretty clear, not because i say it, that the ball is in the house's court. there is a compromise available, and ave. out of this blind alley that they have driven

themselves into, and it is the senate bill. vote on it, pass it, and we can move on to discussing in figuring out a solution for the year-long expansion. -- extension. senator coorker, i know what is clear to happen in agree with the editorial, probably the best thing to do at this point is get this behind us and move on. urging the leadership to change course and endorsed the compromise reached in the senate but got the support of 90% of those members, democrats and senato republicans alike. so do the right thing. past apparel tax cuts. -- pass the payroll tax cuts.

yes, alex. >> staying with this theme, specifically what person are they offering in return? to go you misunderstand. this is not the games of high- stakes poker. -- >> you misunderstand. we're talking about 160 americans -- 160 million americans in their paychecks. there was a bipartisan agreement reached with overwhelming support in the senate at the direction of the leader in the house that initially garnered the support of the republican leader in the house. let's review history here. the president and democrats initially supported and put forward the american jobs act, which was paid for entirely.

the president very firmly believe he could have his way entirely was the way it should be done. and when republicans block that, and the senate democrats crafted a separate parallel tax that the extension with extensions and other measures and tried to move it and have it paid for by asking 300,000 wealthiest americans to pay a little extra, republicans blocked that. so we compromised. the president on the senate compromise. -- the president and senate compromised. the deal that was passed by the senate by a vote of 89-10 did not have the pay-fors that the president and democrats wanted, but i have a compromise that won the agreement of 89 senators, including 39 republicans.

that is the essence of compromise. the bill even included an extraneous political victory that republicans insisted on. >> when will the president signed [inaudible] >> when he gets here. i am not sure it is physically here yet. that is a process and that'in institution which involves a process for him to sign. >> what are the additional steps? what are you talking about specifically? >> the fact of the matter is that we have throughout the process worked unilaterally and

collectively to increase pressure and isolation on the regime. what you have seen is a continuation of horrific acts of violence against the syrian people. it shows every method is moving against assad. diplomats have been leaving their posts and coming out in support of the opposition. the regime has been cut off by the arab league, traditional allies and neighbors like turkey come in the regime is under increasing financial depressed due to weak domestic economic international sanctions. only fear is holding it together. governing based on fear is always doomed to fail. >> [inaudible] >> i do not have details to provide to you about additional measures we will take, but we

will continue to pressure working with our international partners, the regime, and the writing is on the wall. the isolation increases. more and more members of the national community of nations are joining the call for syria to stop this atrocious behavior. >> clearly the president will state in town to sign, but said it is up to the speaker to make the next move. what is the president's next move? will he join his family in hawaii? >> i do not have any updates to give you. he made clear in his call to the speaker earlier today that that action that must be taken is the house needs to take up the

senate bill that was supported by an overwhelming support of senate the democrats and pass it to make sure taxes do not go up. the negotiating has happened already. as i just explained, it is not at all the case that this is simply the president saying here is what i want and do it. this is a compromise worked out by the republican leader in the senate with the democratic leader in the senate, with the approval and instigation of the leader of the house. >> "the wall street journal" opines that the president has won this battle. if the payroll tax cut is not extended, the economy most economists able supper. how concerned is the white house that it does not get extended

and the economy will take a big hit? >> we are very concerned of the micro and macro. the macro economic affect on growth that not extending the tax cut and unemployment insurance would have. outside independent economists, not the ones who seem to disagree with basic economic fact, say it could have a negative impact of up to 0.5% of gdp. we firmly believe in the end, because there is such an overwhelming support for the payroll tax cut and extending it for a year, that this will get done. we believe eventually the house leadership, house republicans, will understand that this is not about giving president obama a victory. this is about exercising their

authority on behalf and demand of the american people. a bipartisan consensus of the american people as represented by the enormous bipartisan vote in the senate. it is the right thing to do. at the micro economic level we're worried about individual families who need extra money. in an average of $40 per paycheck. as you know on tuesday the white house called on americans to add their voice to the conversation in washington about why we need to extend the payroll tax cut. if congress fails, if the house fails to act, the typical family making $50,000 per year will have $40 less to spend or save with each paycheck. that of up to $1,000 for the year. -- that adds up to $1,000 for the year. over the -- over 7000 submissions is the last number i

got. someone contacting us from connecticut says i can buy lunch from the cafeteria for almost a whole month for my twins. i can save it for my daughter's prescription deductible. to some people $40 is nothing, but that is big money for us. in west virginia someone wrote in saying after everything that comes out, my take-home pay is $150 every two weeks. -$40 would be $110. i can barely get by now. taking $40 away from my pay would just about put me under. this matters. this is real stuff. this is not about high-stakes poker, it is about 160 million americans and their families and that impact of the failure to act would have on them.

the voices are growing louder from average americans, republicans and the senate and even in the house now. from respected commentators in the conservative arena. the house needs to act. they are not behaving in the interest of the country. we want to do this to get there with them. we want to work with the congress, with republicans and democrats alike. that is how we achieve the compromise in the senate that was offered -- co-authored by senator mcconnell. it is time to get this done for the american people. hey, mr. knoller. nice to have you in the front row. >> is the white house at odds with the speaker when he said earlier today rather than to a two-month bill now there is plenty of time left to be here for the senate to come back and choose negotiators and work out

of year-long expansion of the petrol tax cut bill? >> we disagree with that proposition, because we need the assurance that taxes will not go up on january 1. that insurance is the compromise two-month extension that was voted on by republicans and democrats alike in the senate. we are absolutely committed in working with congress for a year-long expansion. the president was out there without any republican support in the beginning in the fall pushing this. republicans have gone from opposing it, tepid support, and now insisting it would cause -- that we would rather have taxes go up on the american people wanted to reverse been create the uncertainty of a two-month extension. let's take you back to that