the agency can do the full panoply the panoply of responsibilities. instead, right now, the agency regulates traditional banks but not non-bank lenders. where many of the problems came from the home about. the minority's own witness said as much august 3. i hope my colleagues will consumers need these protection. the banking industry needs fair minded kind of comprehensive way of doing its job.

attorneys, ohio solicitor general, attorney-general, state legislator. it is time to put the consumer cop on the beat. >> thank you, senator brown. >> we all know the consumer financial protection bureau with a key component of the dodd- frank act and it took time to put a director in place so that will be sufficient. i appreciate your coming today and i appreciate your family being here with you. for too long, americans have fallen victim to financial abuses at the hands of predatory lenders that operate with impunity and outside of consumer finance laws and away from regulatory oversight. payday lenders to banish the people in north carolina for many years until after considerable legislation and

litigation, we put a stop to the practice. i am optimistic that with the confirmed director in place, we can start to rein in of predatory lenders in parts of the country where they continue to pray on american families outside the regulatory environment. offices within the bureau have already embarked on important work and once again to as a time to put a director in place to support these offices. the office of service members affairs was set up within the bureau to ensure that military personnel and their families are educated and empowered to make better informed decisions regarding financial product. the opposite is already doing tremendous work. in may of this year, i held a round table at fort bragg in north carolina holly petraeus, the director of that office. we heard directly from the men and women in uniform about the challenges that face and the lengths to which the officers

must go to actually protect the troops from financial abuses at the hands of predatory lenders. i think a strong director will be crucial to ensure that the momentum of the office continues and can be translated into meaningful financial protection to our men and women in uniform. i am aware that a number of concerns have been raised about the impact that the bureau will have. i will be interested in how mr. portrait, you intend to balance the needs of consumer protection with the need for community financial institutions to provide loans to homeowners and small businesses. i am hopeful that we can mitigate these concerns and move forward. his book time to put a director in place so that the bureau can get on with this important work. thank you, mr. chairman. >> senator menendez. >> first of all, i want to thank

you for moving forward with this hearing. i want to thank attorney general portray -- cordray for accepting the nomination. beautiful smile. consumer protection and the director of the consumer financial protection bureau are important topics. but unfortunately, progress had been bleeding. progress in holding wall street accountable and protecting -- protecting consumers. the consumer protection bureau financially open its doors in july. months before my colleagues on the other side of the aisle said they would be fighting with wall street and blocking any nominee. let me repeat that, any nominee from heading the consumer an

extra protection bureau. not only would they be blocking anyone, regardless of qualifications, and i think we might agree that we have an eminently qualified candidate here who not only received the approval and support of consumer groups throughout the country, but the regulated industries that they oversee a positive things to say about him as an individual. not only with a plot anyone, regardless of qualifications, they demand that will radically change the structure of this new consumer protection agency month before it had even opened its doors and many more months after this matter with legislatively settled. the last time i checked, in a democracy, when there is an election of the people, they choose their representatives. you have both both in committee

and on the floor, and then those votes ultimately pass into legislation signed by the president of the united states. it is the lot of the land, unless we want to change the dynamics of what democracy means in this country. in other words, before they even had a chance to objectively evaluate work and the effort of the consumer financial protection bureau, and despite the glowing reviews and that many industry members were already giving it, my colleague said no, shut it down before it had even begun its important work. mr. chairman, i am looking forward to this hearing, which is in the pursuit of confirming someone for the chairmanship subject to existing laws. americans may be freed and are free to disagree with the law, but they are not free to disobey it.

we in fact may be free to say we do not like a law that was passed, but that does not mean we should block it as a way in which we conduct its finger could be that minority rights are very important, but that not nullify majority right as selected by the people of this country, especially when that majority, particularly in passage of this law that is a lot the land what the majority not just of a think your party but a majority of both party. a minority has right, but it doesn't have the right to nullify the law by virtue of its actions of insisting that it will not approve a chair, regardless of that individual's capacity, regardless of that individual's intellect or ability. mr. chairman, i hope we will be

able to make some progress so that we can hold wall street accountable. i have to say, i have the greatest respect for my distinguished colleague and ranking republican on this committee, but i just take a different point of view because when we talk about what has happened in this economy, what has happened in this economy is that we had not a free market, which i support, but a free-for- all market. in that free-for-all market, where regulators were asleep at the switch and other entities were not in existence to protect the consumer, we ended up with not just the great recession, but on the verge of a new depression. and so we do not want to relive that history, so that we can, in fact, protect consumers and ensure that our economy can move forward and not run these risks again. the consumer financial protection bureau is an essential part of that, recognized by majority of both sides of the aisle.

that is why does a lot of the line -- that is why it is the law of the land. >> the center brown will introduce richard cordray. >> thank you again, mr. chairman. it is my honor to represent were the finest public servant i have ever met, richard cordray. his father has been legally blind. it is clear where he and his family learned about public service. he was a strong voice for ohio went to struggle to stay in their homes and consumers who faced unfair practices by deceptive lenders. targeted financial institutions including fannie mae that used accounting fraud to undermine investment that provides retirement security for teachers and janitors and secretary. he took on unscrupulous actors

and work closely with a high of banks to crap effective target legislation. as the treasurer at the county level in franklin county n.j. with banks to craft effective target legislation. throughout his career as solicitor of ohio, he has been a strong voice for his client and for consumers. the top executives of all high of fortune 500 country -- companies, from the north is nomination. they are here today in support of his confirmation. steve rasmussen of a fortune 500 company believes ridge will

embrace the partnerships he has built in the business community as leader of the cfpb. he has the bipartisan support of former ohio attorney general including the current one that he would win the praise of his own projects former opponent speaks of his integrity to it -- his integrity and professionalism. i have letters of like to submit for the record from the ohio bankers leak, one signed by steve rasmussen, one son by our former colleague and national hero, john glenn, all of whom are supporting this fine public servant. mr. chairman, if for no other reason we should confirm him, he was a 5 time jeopardy champion. i actually tried not predict

tried out for jeopardy once and i did not get through the first round. i was very excited about this appointment and very proud to address mike -- introduce my friend, a terrific public servant of ohio, mr. richard cordray. >> i am looking forward to hearing your testimony. will the nominee please rise and raise your right hand. do you swear or affirm that the testimony you are about to give is the truth, the whole truth, and nothing but the truth, so help you god? do you agree to appear and testify before any duly constituted committee of the senate? >> yes, i do. >> please be seated. please be assured that your written statement will be part of the record. please also note that the members of this committee may submit written questions to do

for the record, and you should respond to these questions properly in order for the committee to bet your nomination. mr. cordray, if you would like, please introduce your family and friends who are in attendance before beginning your statement. >> thank you, mr. chairman. i will take you up on that suggestion. i feel like i don't need to introduce them at this point. my wife peggy and my twins, danny and holly, who are excited to be here today, in part because they missed a day of school. i would echo senator brown in thanking the president of the bankers lead in the general counsel of credit union league who are in the hearing room today. thank them for their help and support. i want to acknowledge chairman

john leibowitz it was here earlier and had to leave. they have been tremendous partners to our bureau in helping us that up operation and in fourth collaborative enterprise for us that will mark the years ahead. there are other friends here but i am grateful for their presence. it is appropriate at this time, i do have an opening statement. thank you, chairman johnson, ranking member shelby, and members of the committee. i am honored to be here as a nominee. i appreciate the confidence the president has shown in me and i say thank you to elizabeth warren for turning the bureau into a tangible, liable agency. committeeul to the members for your courtesy to me and your advice which i have welcomed and will always welcome.

let me discuss how my background and experience might inform your consideration. my parents taught me the value of work that seeks to improve the value of others. my dad, frank, who is 93 years old, spent his career working with children and adults with developmental disabilities. my mother was a social worker who founded the first foster grandparent program for the developmentally disabled and ohio and was doing all the things on mother does to raise three rambunctious boys. through my work i became deeply engaged in consumer finance issues and the fall of a deep resolve to address these issues i have found to be basic to our community scared working with troubled taxpayers, i learned there is no one-size-fits-all solution.

on a variety of issues, i sought to find new partners, and we experimented with new procedures. we pushed legislature to pass a new law requiring high school students to receive personal finance education before graduating, income and to that law by developing a curriculum and training hundreds of teachers. as we saw the foreclosure crisis wreaking havoc in many neighborhoods, and this was early 2004, i saw subdivisions where 1000 foreclosures would wreck the dreams of every resident. we created a task force that brought together businesses, banks, nonprofits, and governments to combine perspectives to assist people who were frantic not to lose their homes. i continued to work on

financial literacy issues on a state level. i also noticed we had a neglected low-interest lending program to help small businesses create jobs and help farmers access affordable credit. we revived the program, sought to expand it, and reaching out to community banks to make the program accessible in his 04 them. over the time that i was treasurer we pumped hundreds of millions of dollars of low interest lending into our communities. all of this work reinforced for me how imaginative strategies can benefit both businesses and consumers, who have many interests in common. immediately, before coming to the bureau as chief of enforcement by served as the attorney general of ohio, working with law-enforcement throughout the state, representing pension systems in

the courts and in force in consumer protection laws. my main objectives were to help empower people to make better informed financial decisions for themselves and families, and to stop the scams and frauds that she consumers and undercut law-abiding businesses. at every stage of this work i believe that law enforcement that is even-handed, fair, and reasonable, not only protect consumers, but supports honest businesses in two ways. first, the businesses that cheat can gain a significant and unfair advantage. second, keeping the marketplace claim is crucial to give consumers the confidence they need to participate in that market. at the consumer bureau i found that congress has given us a broader range of tools to address these issues, including

research reports from our role making, marketing guidance, and consumer education. we also have the critical ability to examine large banks and nonbanks, so participants in the same market will be subject to the same roles and burdens, and to resolve compliance issues more quickly, without resorting to litigation. i am convinced we will find many opportunities to streamline regulations and disclosures. our project is working to combine disclosures overlapping mortgage laws in order to make the risks clear to consumers, and reducing the paperwork burden for lenders. it is a true win-win. i believe we will find the same sweet spot as we review the regulations we have inherited from other agencies. chairman johnson, ranking

member shall become and other members of the committee, i appreciate your consideration. i will always be keenly interested in your thoughts about our work. thank you again, and i appreciate the opportunity to answer any questions you may have. >> thank you. without a director in place, the bureau will not be able to exercise examination and enforcement powers over nonbank financial institutions like private student lenders and credit bureaus. did you agree that this authority is essential to level the playing field between responsible small community banks and their nonbank competitors?

>> i do, mr. chairman. i think it was one of the key principles embodied in this new law, and i remember a conversation i had with a committee banker in ohio around 2007 when i was state treasurer, talking about people seeking loans that were not feasible or sustainable. when he would tell the customers that, he would see them go down the street to on license, but regulated lenders who would make the loans, even though they are destined to fail. our good lenders were losing market share by upholding their standards. then, of course, it was that in balance and the mortgage lending that it led to that was so terrible people were often falsifying income and occupation that led to the financial crisis. now the community banks have suffered the second double

whammy, which is credit has dried up and it is difficult to maintain operations. one of the things we will not do at the bureau under my leadership is impose further burdens on the community banks and credit unions, who as i said in working with them, have different constraints and abilities to comply with excessive regulations, and that is something we will not do on my watch. we can exempt them, due to a below-tier regulation and listen closely to their concerns. >> one was home in south dakota this past month i heard concerns from small community banks and credit unions about the bureau adding to their regulatory burden. can you elaborate if you are confirmed, how do you address these concerns?

>> mr. chairman, we have heard the same concerns, and i've heard those concerns over and over again from those that taken the time to meet with me. it is impressed upon me how important this is to get this right. i'll refer to my own experience. i worked closely with community banks. the low-interest program, the easy way would be to pass money through the large banks. the harder way would be work with community banks understanding the need a form that could be filled out in 30 minutes or less. we give them a decision and promised that within 72 hours. that made it possible for them to work with us. they are of different character, thriving on customer relationships and their knowledge of the community. if they could have a level playing field to compete they

will do well. we do not examine institutions of $10 billion in assets or less. we do have regulatory power, but again, through exemptions and through listening closely to their concerns, which is something i did as treasurer and attorney general will be able to take account of those burdens and avoid heaping more difficulties on community banks. >> as we have discussed, there are a number of mechanisms in place to make the director and the bureau accountable. as director, what steps would you take to insure accountability? >> mr. chairman, it is a mosaic of interlocking pieces that create accountability. the most important thing in any federal independent agency is to follow the law carefully and closely, and that includes rulemaking, that we comply and

consider costs and burdens. it means we should be attentive to legislative oversight, which i have been at the state level and would be here, and that means we pay close attention to audits. i found that to be a useful tool. in each case we clean those up. at the cfpb, we will take those responsibilities seriously. >> senator shelby? >> i yield to senator corker. >> thank you, mr. chairman, and ranking member. i have been on recess, and want to 60 dense or so, and a little shocked coming back into the

banking committee, which has been very non-partisan, to hear the spewing i have heard from almost everyone on the other side. i'm a little shocked by that, and some of the half-truths that have been stated. the fact is the only two people that i am aware of on this bias that were directly involved in negotiations to create this consumer agency are sitting on this side of the diocese. it is an absolute fact. the only to people that i'm aware of the negotiated day after day to create this organization are sitting on this side. i'm a little shocked at some of the comments that have been made, and actually disappointed at their rancor in this meeting. the fact is that what we have talked about, and you and i

talked about this in the office, is the fact that the only way this oversight council can challenge something to the head of this agency puts in place is if it threatens the stability of the financial system, which is a pretty big hurdle. the chairman of this committee compared this to the sec, the fdic, and the fed, all of which are commissions or boards, therefore they have people who help the executive in prudent rulemaking. so, i am stunned at the untruths that have been stated, and the partisan nature. i'm sorry you are caught up in all of this. you and i talked about the fact that almost all of this would go away if the administration would sit down and put appropriate checks and balances in place.

i talked to mrs. warren about this, and i talked with you about this. thosendering how conversations went between you and the administration regarding the conversation we had, and the possibility of just having some degree of check and balance for this new position that you hope to hold. >> senator, i appreciate the opportunity to meet with you and to hear your concerns first hand. i conveyed the substance of those conversations back to the administration. i've not sought to inject myself in legislative discussions that might be between the congress and the president. my job at the bureau has been chief of enforcement, and our role is to take the laws that congress has enacted, wherever they may be, and to enforce them to the letter. that is what we are trying to do.

the consumer reports were good in that we did identify all of our mandates under the law and we have begun implementing those and communicating with other agencies, which goes into your question about the financial stability oversight council. we are required to communicate and consult with our agencies. we would be a poor example of government if we did not take that seriously. i hope the concerns they have and we have will be discussed regularly and we will work out those issues when we have disagreements, and it will never be necessary to invoke some super-process to override our roles. if they talk about their legitimate concerns that a rule might threaten the safety and soundness of the banking

system, we should take that to heart. i think that is what we will do. >> with the agency the not independent if it had a board? >> i think that different independent agencies are structured in different ways. the currency has set a single director for 100 years. other agencies do have the board. it could work both ways. congress created us and gave us a director. it is difficult not having a director in place. >> is the threshold pretty high? meaning, unless a rule you create threatens the stability of the entire financial system, it cannot be challenged. that is a pretty high

threshold, is it not? >> i do not know how to evaluate that in the abstract. >> did not do that in the abstract would you agree that unless you create a will that be stabilizes the entire financial system that that is a pretty big threshold for other regulators to challenge what ever you so we decided against? >> if it is a standard that does not apply to any other agency. is a high hurdle, but not inappropriate. we will be consulted regularly in the examination function. i think the two are largely and harmony. it will make sense for us to go together as we to our workers. that would be my intention if i were the director. >> i hope we continue to work on this. i do not understand why the administration will not work to

solve this nor why they allowed this to be the lightning rod that it did not have to be when there was support on both sides of the aisle for a consumer protection agency. let me move to you for one moment. i had a very pleasant meeting with you, and complimented you and your family. it is not typical to have a political activist in state party politics announced to be head of the national organization. typically, you pick people that i've had experiences in that regard. that is not the case with you. you seem like an outstanding individual in many ways. you had announced that you wanted to run for governor of ohio, which makes it even more odd. typically, we do not have regulators running agencies that can make rules over the

entire financial system that might be able to make a name for themselves in doing so when their goal is to go back to their home state and run for governor. you seem to indicate that was not the case, but i wonder if that could be spoken to, because as you cut a imagined in the way this has been set up that would create some questions. >> i trichet the attendees to address that issue. i did say that last year before i came to work at the new consumer bureau. i can tell you i have no plans to run for any political office. i am understanding that the work of a agency must be completely absolves of politics. the two do not mix, and that is all i have approached my job. >> how you feel about late fees on credit cards and mortgages? >> when i was the treasurer of ohio, the federal reserve was proposing rules and regulations

to curb some of the practices that had come up with late fees, and i supported the changes in the rules which eventually were adopted by congress in the card act, which i think was a good set of reforms. one of the jobs of the bureau will be to monitor compliance with those new laws, and we found that compliance was pretty good with the new laws, and it did not restrict credit nor raise the price of credit for people. they seem to be sound and sensible reforms. >> are you not concerned about people who pay their bills on time having sees higher because the people that do not pay their bills on time, and strategic default in general -- we are creating an environment it appears to me where we are encouraging people to default. we have agencies of government

that are now encouraging that. do any of those kind of things concern you, especially as someone who is going to be overseen big parts of this? >> they do, senator. that is part of the balance that needs to be drawn. i have credit cards, and try to pay the balance is diligently. i do not want to be billed for the problems of others. i also think that the practices as they were reform have been good reforms, and i think congress acted wisely there. we will be attempting to insure that that law is being followed as congress enacted it. i guess that is my attitude. >> the chairman has been generous, thank you, and i

might stay for a second round. if thank you for your testimony and for bringing your family. >> thank you, mr. chairman, and to your willingness to serve in a difficult time in a challenging office. you also served as the state treasurer in ohio. >> i did, yes. >> so, you come to this job with multiple skills -- one as an attorney general who had to go out and protect people, and two, as essential the chief financial manager for the state of ohio. suffice to say, and you can elaborate, you are certainly aware of, but not only aware of, but sensitive to some of the concerns of the banking industry about the predictability, the soundness of financial institutions, the needs they have. is that fair to say? >> i think i am, senator. i was both a state and a county treasurer.

was a aaa rated county, which is unusual in american local finances, but most notably during my tenure as treasurer was the time beating up to the financial crisis, 2007-2008, one of the most difficult times to manage and safeguard public funds that i think we have seen in my lifetime. we were careful and conservative about how we invest in the public money and suffered no losses when i was the treasurer. i'm very proud of that. i also think that work gave me a very close working relationship with banks in ohio because they have partnered with us in a lot of the work we did to manage finances as custodians of pension funds, in terms of debt issuance, both in large and small banks. it gave me a good working knowledge of their concerns.

i created an advisory council when i was state treasurer and brought forward the same approach. that is the accessibility i have tried to foster, and that would bring that to the bureau. i do have that background, and i think it is part of what would be kept in mind in assessing my qualifications. >> one office in your purview -- [unintelligible] many of us think it is critical because these are in place of a federal government, and they are usually far from their home, and their ability to connect with a local attorney general or a state's attorney is limited, and this goes back about 35 years.

i can recall how they were victims of many consumer frauds. now, i am hearing because of the internet it is even worse and even more difficult for local authorities. now we have a federal office. >> i have some awareness of these issues. when i was attorney general for ohio, we created a group that provided legal advice to soldiers being deployed. since coming to the bureau, i have learned a lot, and part of what i learned has been from mrs. petraeus. she has taught us all about the special needs of service members, how deployment and even forced transfers within this country create hardships for their families. she herself talks about how she and her husband have moved 23 times in 36 years.

also, the fact is there now finding that if you have consumer finance issues as a citizen, there are tough enough. as a service member, you could lose your security clearance. you might not be able to continue to do the job you are trained for. is not good for the military or the country. it is a serious issue. she continues to bring this to our attention. we met to begin addressing these needs. so, this is something we are excited about and we hope to be able to deliver for those service members. someone will stand on their side, and i hope i will be one of the marked successes of the new bureau. >> thank you very much. >> senator shelby.

>> i have no questions. i do have an observation. i'm sure you have a good background. you have a fine family. you are caught between eight substantive debate that you now will have to be resolved before we move this nomination further, and i discussed that with you in the office. i want to join senator corker, just for the record, mr. chairman, senator corker and i were very involved in the banking legislation. we had advocated a consumer agency, but we wanted accountability with it, and we still do. >> senator? >> thank you, mr. chairman. i appreciate senator shelby's comments, because that is really the point.

during this whole process that senator corker, senator shelby, senator dodd and others were in the midst of working out legislation. that is what we do around here. the many elements in the consumer part of the bill, that i know you worked with elizabeth warren on, senator corker, where done with major concessions on both sides. senator corkers supported an amendment i had about the six banks being too large. that is what happens here. you win some, you lose some, but i am puzzled by senator corker's comments about excessive partisanship here. we wrote this bill. it passed with some number of republican votes. there was consistent and frequent republican and put, much of which was accepted.

it passed by both houses. was signed by the president. i go back to what the senate historian told me. never have we seen in this senator a party saying no to putting people in place to run an agency because a large minority is opposed to parts of the law. i just do not understand that. in the end the question is is richard cordray qualified for this position, and no one has made the case that he is not, and most of us have made the case that he is. it is a pretty strong case. i hear the accountability question. i want to get your comments and i will speak for a couple of

minutes. what i think the bill does about the unaccountable rulemaking process -- a couple of examples. before proposing the law, if there is consumer disclosure involved, you are required to seek the clearance of 0 wendy, considering the potential benefits and costs to consumers, consulting with regulators and other agencies regarding the rules. this is all before proposing the rule. there is a significant economic impact did you must follow the small business regulatory enforcement act. you must prepare an initial regulatory flexibility analysis. when proposing the rule, you must give public notice, offered the public be attended to comment, consult with appropriate agencies, conduct a

final regulatory flexibility analysis. after the rule has been finalized, if any member of the financial stability oversight council objects to a regulation, they can petition to get it removed. they can set aside an issue. under dodd-frank, cfpb reviews each significant order within five years of enactment to address the rules effectiveness. is your understanding similar to the process of accountability and statutory requirements you would face as director? does the private party have an opportunity to challenge that one of your regulations in court? what recourse does the president have? can the president remove a

runaway director because he or she is not happy with the director's ideology, direction, or will making? are these checks similar to what applies to other agencies. i would like you to spell that out. >> i will do my best to address those questions. as with any independent agency, the leadership of the consumer bureau is not subject to direct removal by the president, as are cabinet departments. congress sets up agencies in that matter. our job is to carry out the laws enacted by congress, and we are subject to your oversight in doing so. the long list of restrictions and/or process guidance they you laid out in terms of rulemaking by the bureau i believe was pretty comprehensive. i was trying to take notes.

i would also said that one thing i want to emphasize is that think we have the real opportunity here, inherited many regulations we did not held to write, and that in the aggregate they have created undue burdens, particularly as there was a fever for disclosure over the last 30 years, and it got to the point where the disclosures were so long and confusing that they did not really help consumers. there is an opportunity to streamline and cut that back, and that will be a priority for reified and director. we are also subject to oversight by the courts. the d.c. circuit court of appeals recently rendered a pretty, i would say, tough decision on rulemaking by federal agencies in terms of making sure the agencies do a careful cost benefit assessment of any rule, and that they not simply reach a conclusion and rationalize it after the fact.

that is something we will take to heart. there are a number of checks that are similar to other agencies, and some that were imposed in a lot better in addition or new compared to other agencies, but we will live with the law. >> senator schumer. >> thank you, mr. chairman, and thank you, mr. richard cordray. my interest in the agency as one of the initial sponsors came after 10 years of trying to get simple credit card disclosure. i got the basic "they are busy with other things." none of the other agencies put

the consumer at the top of their mission. so, an independent agency had a great deal of appeal to me. it is an agency designed to finally put consumers first. it is under attack even before it is fully on its feet, and i do not want to go back to the old days where we go to the fed were some agency and say the consumer needs this reasonable protection, the simple adam smith disclosure. no one knew what interest rates were when they signed up for credit cards, and the fed interest rates were sporadic. i like the fed in general, but in this area they were not very good. so, in general, here we have an attack that is not in the ordinary. it is extraordinary.

two sides make arguments, and put it to a vote. we fought those battles last year. consumers one. now the consumer protection has become the law of the land with its own agency, some of our colleagues want to reopen last year's debate because they could not win it through the ordinary legislative process. there promised to block this nomination or any nomination until they get their way. is hijacking the legislative process. you have a legislative battle, you lose, and say i am not going to appoint anyone because we lost a legislative battle. it is not the way things work around here. if this nominee loses, who wins? many of the abuses will be allowed to continue, and the new cop on the beat for consumers will be forced to

stand down. seniors will remain vulnerable to predatory credit reverse mortgages, and the cfpb will have to fight with one hand tied behind its back to protect them. the service industry will not win. banks that play by the rules do not win. they will be forced to compete with unscrupulous lenders. a good part of this financial crisis will remain on regulated while many of the banking institutions that are regulated will still be abiding by the rules. no doubt, that is why the ohio bankers league supports your confirmation. in short, without a director, the cfpb has the least authority where it needs it the most. we should be here to debate the

qualifications of mr. richard cordray to lead the cfpb, question that would be answered easily in the affirmative. i will execute a few quick questions. senator shelby has met with you and that is to his credit, but how many of the other 43 that signed the letter actually met with you or as few questions before they signed the letter? >> senator, i was not a nominee at that time, so i do not know if they would have known to seek me out. >> how about subsequently? >> since i was nominated, we've made an effort to meet with each member of the banking committee. i've not reached out beyond the banking committee at this point. >> how many meetings did you get? >> i got a number of meetings. >> thank you. ok. i read a little bit about your background, learned you got your first job that mcdonald's. what did you do, and how much

did you earn? >> i was a hamburger flipper, although it always seemed like the managers nominated me to clean the parking lot whenever it rained. [laughter] >> i hope you use different rules for each job. [laughter] >> how does a kid who worked at mcdonald's earned scholarships in michigan state, oxford university, and the university of chicago law school? >> i worked hard in school, has a terrific teachers and was fortunate. >> what does it mean to you that mike dewine who defeated you in the attorney general election has supported your nomination? >> we have maintained a tough relationship, and i appreciate what he had to say about me very much.

>> it will be bad for consumers if his nomination is hijacked and his he is treated as a pawn, it will be bad for the country. i hope my colleagues will change their minds have been that you and seen the quality show as a candidate. >> senator mendez. >> you seem to have a strong record on consumer protection issues, and yet been endorsed by several consumer advocates, as well as ohio businesses and bankers as well. is that fair to say? >> i have been. in fact, the ceo of the ohio bankers leaked wrote a letter of endorsement on your behalf saint ", while i retain

reservations about the cfpb structure, i believe mr. cordray would be an able director. while he and i have differed on specific decisions, you should know that consistency to reach those decisions has welcomed competing ideas, and has systematically reached out to get better insight." in other words, while he may have reservations about the agency, and may even disagree with you on some policy matters, he still recognizes your qualifications to lead the cfpb. is that not correct? >> i do not want to speak for anyone else, but in my relationship with the ohio bankers lead, i've always been open to their concerns, and that made me do a better job. >> could you not deduct from that letter that there is an

endorsement of your capability to do the job, even if there may be disagreement about what the agency is about. >> i think they have come to respect my public service and understand that i've tried to be honest and straight forward to do the right thing, by getting broad it buys and input from a lot of sources, including the banks and businesses i've worked with. >> have any of my colleagues on the other side of the file called into question your qualifications for this position? >> i do not know of that, senator. >> in your meetings with my colleagues, has anyone called into question your qualifications? >> we of had good, a cordial meetings with a frank exchange

of views, and i have tried to listen carefully to what was said by all the senators, and i hope i will developed that reputation, and i hope it will make my job easier and better. >> let me try again. has anyone said to you, mr. cordray, i have problems with your qualifications to do this job? >> they have not. >> thank you. i understand my colleague senator brown has gone through the checks and balances that some believed not exist, but there is a large number of them. is it not true that without a director the consumer financial protection bureau does have a supervisory authority over large banks and the ability to enforce existing banking laws, but it will not have

supervisory authority for non- bank financial service providers, such as pay lenders? >> it is one of the unfortunate difficulties of the current situation that without a confirmed director, the bureau, it is widely agreed, has inherited full powers over the large banks, but there is considerable difficulty with the powers we have over the same bank entities competing in the same market. i am haunted by the conversation i mentioned earlier where a baker talked about how only part of the market was being regulated and they were talking about losing market share to the unscrupulous, on regulated. that is something i hope we would not repeat. >> in other words, there would be an uneven and on balance playing field for community banks have to abide by the rules, but their competitors will not have to? >> that is the unfortunate

difficulty of the current situation. >> it seems to me that community banks would think that is highly unfair. furthermore, without a director, the bureau cannot protect students from burdensome student loans, consumers from deceptive financial products, and protect our troops from deceptive products from nonbank lenders. how is that fair for those banks that played by the rules, yet could lose business to competitors who do not have to play by the same set of rules? >> i think it is not fair, and it is not wise as the regulatory approach. i spoke in my opening statement about law enforcement that is even-handed, fair, and reasonable. by putting people in the same rules, they could then compete, and the good businesses that base their business on customer service and delivery like our community banks, i think will prosper. >> thank you, mr. chairman.

>> thank you, mr. cordray, for your testimony, and your willingness to serve our nation. i ask that all members of the committee submit any questions for the record by the close of business on friday, september 9, and mr. cordray, please submit your answers to these questions to advance your nomination. this hearing is adjourned. [captions copyright national cable satellite corp. 2012] [captioning performed by national captioning institute]

president obama was talking about procurement reform. people about the wet bar that will make a difference, lawmakers. -- about the one thing that'll make a difference, lawmakers. ll provides members of military.com with information. >> after finishing six of the iowa caucuses, michele bachmann

called and into the presidential campaign. the news came in iowa. >> thank you for being here today. i am proud to announce to you a good friend of mine, michele bachmann. >> thank you for being here. my name is michele bachmann. intrinsic to every american is the responsibility to watch over our republic. you can look back to the time of the pilgrims, to the time of

our founding fathers. all we have to do is look around. very clearly, we are encompassed with a great cloud of witnesses that bear witness to the sacrifices that were made to establish the united states and the precious principles of freedom that make it the greatest force for good that is ever been seen on the planet. every generation has served as the next steppingstone down the path of our liberty, and every day i am reminded of that conviction. i have a painting that hangs in the united states capitol. it was made at the signing of the constitution of the united states. every schoolchild is familiar with this painting.

i am privileged to see it on a regular basis. never was the painting's poignant reminder more evident than on the evening of march 21, 2010, the evening that obamacare was passed. staring out from the paintings are the faces of the founders, and in particular the face of ben franklin. ben franklin served as a constant reminder of what he and the founders gave to us. they serve as the inspiration for my run for the presidency of the united states. i believe firmly that what the congress had done and what president obama has done in passing obamacare endangered the survival of the united states of america, our republic. i knew it was my obligation to ensure that president obama's program would be stopped before it became fully implemented.

my message has been the necessity for the complete repeal of obamacare in this once-in-a-lifetime campaign cycle for the presidency. obamacare represents the largest expansion of entitlement spending in our country's history. it has become the playground of social engineering, where the right always lose every battle and the left already has been given the formula for passing their agenda. it must be stopped. its repeal is more than just a cliche for me. obamacare violates our fundamental liberties as americans, including taxpayer- funded abortions. deeply troubled by the state of our country, i ran for the presidency as an american citizen who believes in the greatness of our american principles. our principles derive their meanings, which are seated in the truth of the holy scripture, the bible.

a politician i never have been -- nor will i ever hope to be, because i am not motivated in this quest for vainglory or the promise of political power. i have served one singular purpose in washington -- to lead an effort that was begun by the people of this country. that requires taking on the charge of repealing obamacare and dodd-frank, which mandated ensuring the election of 13 additional republican senators to guarantee that legislation's demise. these words of warning -- a turning point for our country and our economy. i worry what the future painting might depict, should obamacare

be placed into effect. would future generations ask of us, what did we do, what did we give, what did we sacrifice to ensure the survival of this incomparable republic? i realize that 2012 is our last chance and our only chance to repeal obamacare and dodd-frank. i knew how to get rid of both of them. i ran to elect 30 more republican united states senators who would help me repeal that legislation. i believed that the policies of barack obama are destructive to the very foundation of the republic. i wanted my children and all of the children to live free, and have even better opportunities than our parents gave to us. i ran to secure the promise of our children's future. i decided to stand up and fight for our freedom and for the survival of the nation.

i will continue fighting. i will continue to fight for you. to stop overspending in washington. to keep our country free, safe, and to fight against crony capitalism. fight against a tax code which is unfair, and it's killing american competitiveness. i will fight for american families. i will fight to protect life from conception. i will fight to secure our borders. i will fight for this country. i came here to this wonderful state of iowa, where i was born and raised, and i had just one message to tell you. i told you the truth -- that our country is in very serious trouble, and that this might be the last election to turn the nation around before we go down the road to socialism.

i did not tell you what the polls said you wanted to hear. i did not try to -- i listened to the people of iowa and all across america. they agree that president obama and his socialist policies must be stopped. the party of lincoln believes in the goodness of american people, and that america does remain the greatest force for good that the world has ever known. we don't believe that government has the answers.

government should respect the rights of the people. we believe government should do its job. it should do it without spending more than what it takes in. last night, the people of iowa spoke. if we're going to repeal obamacare and turn our country around, we must do so united. we must rally around the proposition that our country and our party and our people select, to be that standard bearer. i will continue to be a strong voice and to stand and fight for the country, and for our freedom.

mr. franklin and the founders, and the men and women who have given their last full measure of devotion in our military -- our veterans are watching us. they are expecting us to stand up and protect what they have fought to give us. we owe it to them and to the god that we serve, who gave us life to keep our republic free. i will be grateful to the state and to its people for launching us on the path with our victory in the iowa straw poll. my faith in the lord god almighty and this country and this republic is unshakable. i have seen the very best in the country and our people, and i will believe in the greatness of them, and of the god that i serve. i am grateful to our entire campaign team in iowa. i have no regrets. we never compromised our principles. we ran this race with the utmost integrity and made an important

contribution to this race. i thank my wonderful husband for 33 years, and my entire family -- my children, my mother, my stepfather, my beloved brothers who are here, and my brother david, and george, and our foster children. they have been my strength throughout the campaign. i look forward to the next chapter in god's plan, if we will only cooperate with him.

something greater around the corner. i have been blessed to live a wonderful life. i am grateful to have been a part of this presidential campaign. [applause] thank you. ♪

♪ ["soul sister" by train playing]

♪ hey soul sister ♪ ♪ >> we will bring you campaign events leading up to three primaries this month. new hampshire voters will go to the poll followed by south carolina and florida.

>> today the 2008 republican presidential candidate mccain endorsed amid romney. this is 50 minutes. >> what a welcome.

my goodness. it is nice to have a win. can we do better in new hampshire? let me see if i can get a microphone going again. let's try for more than eight- vote margin. i am proud to be here with senator john mccain and a great friend. i appreciate the center being here. i will say a few things, offer some thoughts. as you heard me last night, i was appreciative of the process that began last night. we are on track to retire a guide that is a nice guy, but over his head. it is time for barack obama to go home and time for someone who understands this economy to lead the country.

[applause] i happen to think that the gap between what candida obama promised and what he delivered is so extraordinary that the american people understand that they will do the right thing and, when we have to have somebody that can get this country going in the right track. it is a long list. his failure to put in place crippling sanctions, his failure to stand up for the people that went to the streets, those things that represent extraordinary risks in the future of our world and our own nation, it was the economy. he said he was going to borrow from your generation to pay back, and he was going to do that to hold unemployment below 8%. they're having trouble with the microphone, so i can still hear

myself. people are out of work, they are underemployed. these are real people having a tough time making ends meet. a lot of folks get depressed after a long time of unemployment, and this is a national tragedy. of course government itself. it spends too much money. spending more than a trillion dollars more than we take in, either of us will be alive to pay that back. i think it is immoral for us to spend every year that we take in. the president went out on the today show, and he said that if i can't turn this economy

around in three years, i will be looking at a one-term proposition. i am here to collect. we are going to take back the white house. [applause] just a couple of thoughts about how we are going to fix the country. one is the deficit and a massive spending in washington. i had the occasion as the governor of the state next door, and they allow me to come and. i took our budget, we found that we were $3 billion short in the first administration, the first year. let's divide all the things we

have in the budget between those things we have to do and those things we like doing. i will look at all of our programs and asked, is this program so critical that it makes sense to borrow money from china to pay for it? on that basis, we will get rid of a lot of programs. [applause] and i will go to work to make america a jobs-creating machine again. i know how that is done. i know how to compete with other countries. i know why jobs come here and why they leave here. my intent will make america -- got will be to make america a the most attractive place for innovators and on to open doors. when the head of coca-cola says the business environment is better in china that in the united states of america, you know something has gone very badly awry. i will get our tax rates competitive, regulations are up today, and i will make sure

that we open up new markets for american goods and crack down on cheaters like china. and we will take advantage of our oil, gas, we can't continue to rely on energy from others when we have energy from canada next door. let's get american in their -- energy secure again. this campaign is not just about dollars and cents. as important as that is, it is not just about jobs. it is also about the heart and soul of america. the question is whether we are going to remain a nation that our founders would recognize.

a nation founded on the principles of opportunity and freedom. when they drafted the declaration of independence, they said the creator had endowed us with certain inalienable rights. life, liberty, and the pursuit of happiness. that last phrase refers to the fact that in america, we can pursue our dreams as we choose. we are not limited by the circumstances of our birth. we are limited only by our dreaming, capacity, and willingness to work. the opportunity where education, hard work, risk-taking, and dreaming lifts individuals and our entire nation. it has been a source of prosperity for america. let it be a gdp per person or income per person 50% higher. these american principles are not temporary, but permanent,

enduring, to ensure they get the job-creating machine going again. the principles of hope and promise that we always love. i think he is inspired by the european-style social welfare states. and believe that the purpose in government is to take from some people and give the others. the methodology to pursue that strategy is to promote enfy as op -- envy as opposed to ambition. i want america to remain one nation under god. i want to bring us together and restore the principles -- i don't want to transform america into something we don't recognize. how want to restore america. i love this country, i love its future, i am an optimist about america. and about the potential that each of you young people has

about being prosperous and free. there is no model in the world had no principles in the world a more effective in creating jobs and peace and prosperity and hope and promise them the principles of the founding of the united states of america. i love this country, i love the principles upon which it was founded. i will restore them for the greatness of this great land. i am proud to introduce a friend, a person that has stood for america in far off places and here at home. senator john mccain. [applause] >> thank you very much, mitt. thank you. thank you. thank you. thank you very much.

i say thank you for that kind introduction, mitt. i say with some stocks a that i returned to this place that i love so well. -- nostalgia that i return to this place that i love so well. we should make mitt romney the united states of america, and new hampshire is the state that will catapult him to victory. that is why i am here. [applause] i would also like to thank all of you for your involvement in this political process. for your investigation and examination of the candidates. there are so many jokes. who are you gonna -- what do you think about him for president? i don't know, i only met him twice.

that is why they are funny, they are true. some of you have not committed yet. i hope if you watch this campaign throughout the state, we will get an overwhelming vote that will catapult this candidate to the white house. can i say, thank you, governor, for all you do? i can't help but see the governor without the old joke of the two inmates in the chow

line. one turned to the other and said, the food was better when you were governor. [light laughter] >> maybe the governor of illinois. >> some states, you can't tell the joke. can i say how proud i am of this rising star? this incredible united states senator -- [applause] many of you know her husband that has served in the national guard. i am glad to see you. say hi. [applause] there are some many friends that i would like to say hello to, but i would like to get right into it if i could with you. i am a big boxing fan, and i have always loved the sport. i think it is one of the most difficult and challenging that there is.

it is one of the great moments in sports, some of the great boxing matches. it has been called the sweet science or the red light district of sports. one of my favorite fighters of all time was a guy named joe lewis. he was the heavyweight champion of the world and he had a fight coming up with a guy that was light heavyweight champion of the world. he had a lot of style and elusiveness. joe said, how are you going to beat this guy? he said, he can run, but he can't hide. our message to president barack obama, you can run, but you can't hide from your record of making this country bankrupt from destroying our national security and making this nation and one that we have to restore with mitt romney as president of the united states of america.

[applause] now, all the media reports is that the president is going to attack congress, maybe that is not a bad idea. the approval rating is 9%. you are down to paid staffers and blood relatives. the democrats and president obama had both houses of congress, both majorities when we passed the bailout, obamacare, the stimulus package. it was going to bring unemployment down below 8%. he can run, but he can't hide. that is what this campaign is all about. i will remind you again. taxpayers were relieved. we passed a $991 billion

appropriations bill to make the government run. do you know how long we debated that bill? 15 minutes. i identified $3.50 billion in spending just in the defense part. it can't go on like this. check and see who is the majority of the united states senate. harry reid and the democrats. along with president mitt romney, and a majority in the united states senate, we will get things done. [applause] i know that jobs and the economy will be the dominant theme in this campaign.

in arizona, people are hurting very badly. houses in my state are under water, worth less than their mortgage. i guarantee one thing, no one will ever say that mitt romney will lead from behind. he will lead from the front like what ronald reagan did. we are believed to be weak, in decline, and that is not the case. mitt romney and i and you believe that america's greatest days are still ahead of us. it requires the kind of leadership to put us back in the position that made america the greatest and noblest experiment in the history of the world. that person is with you here today, president mitt romney. [applause]

by the way, we forgot to congratulate him on his landslide victory last night. [laughter] [applause] >> ok, we are going to take some questions from you. raise your hand. occupyare you, i'm from boston and new hampshire. congratulations on your victory. he said that corporations are people, but corporate profits have surged to record highs directly at the expense of wages in a jp morgan report. it seems the u.s. is a great place to be a corporation. but increasingly a desperate place to live and work, can you refine year earlier statement where corporations are people to

corporations are abusive people? would you reverse the policies of both the obama administration and his predecessors a route corporate center economic policies? record highs every year. people in this country are in permanent economic stagnation. >> what do you think corporations profit goes? >> it depends. if they retain it, they're not and distributing dividends and not using it for capital expenditures. they can hoard it. it goes to shareholders. the 1% of americans that own 90% of the stocks. >> lets get the facts. you've had your turn, it's my turn. you're right, it goes to dividends.

they are not only the 1%. it goes to the people that have pensions. are you in the 1%? no? they are the dividends that come out from corporations. they can go in to retained earnings that can use for capital expenditures are growing the business are hiring people or working capital. when a business has profit, it can do good things. it can grow the enterprise. the only way you can hire people is if it grows the enterprise. corporations are made up of people in the buildings that people were can. the buildings don't pay taxes. the only entities that pay taxes are people. corporations are collections of people that are trying to have good jobs for themselves and promote the future. corporations are made up of people have the money goes to people. somehow thinking that there is

something else out there that we can just grab money from and get taxes from doesn't involve people, and they are still people. i want to make america a place where those corporations decide to invest here. i was with a guy that runs a big chemical company and they announced a factories in saudi arabia. we wanted to build that in pennsylvania, but the regulators in this country are not willing to allow us to get a hold of the natural gas. tens of thousands of jobs lost not by the corporations, but by government not doing its job. i want to be the place where corporations and people want to invest, grow, their businesses. trying to make them better, that is how we get jobs.

the only places that we can get jobs as with government. if we see nations that have tried that and it hasn't worked out. the only system that has worked to lift people out of poverty is free enterprise. look at cuba, north korea, the soviet union, they are bankrupt. look at china, all these years under communism and socialism. poverty, impoverished, they adopt some form of free enterprise like we have, allowing corporations to exist and guess what happens? tens of millions of people a year come out of poverty. if you can come up with one that is better, brought forward by john adams at george washington and thomas jefferson, i am all ears. until then, i am in favor of the one presented by the founders of this country. [applause] we will give you a microphone.

>> in 2006, mandates are to ensure responsibility. passing the cost of health care to everyone else. why did you want to hold people that can afford health insurance accountable in massachusetts? >> i'm not sure about the last part, but the increasing cost, what is that? >> it refers to health care. excuse me. hello. on the issues, healthcare. >> i know the topic, but i don't understand the last part. i don't think anyone is in

favor of rising health-care costs. i think it is probably the most important issue we face in this country today, how to get costs down and keep the quality of. -- up. i'm an old business guide, numbers are something not familiar with -- i am familiar with and kind of like. 18%, the next highest nation in the world spends about 12%. that is six points of difference in spent on health care. and you know how big your department of defense budget is? 3.8%. even less than the next highest country. we have got to find a way to get the health care costs competitive. one is to have the government put in place a price control. and have what some have called rationing.

that is one way to hold it down. i believe that letting consumers act more like for buyers is a better approach. i would let states experiment with that idea. i, as one person, am going to come in and impose on the whole nation, my plan for health care. the right course is to let the constitution do what it was intended to do. the constitution said that those powers not specifically granted to the federal government are reserved by the states and the people. i crafted what i thought that was good for our state, not perfect, by the way. i would not impose that on the nation, but those states can craft what is best for them. what works in massachusetts won't work in mississippi or

texas. we had a% uninsured. texas has 25% of insured. -- uninsured. >> the only thing i would add to that is that with presidentromney -- president romney, we would put in place a repeat o all ofbama -- a repeal of obamacare. if we save health care, obama care must be repealed and replaced. it will be replaced with medical malpractice reform.

giving people a larger responsibility for their own health care at a larger choice for what they choose for themselves and their families. that is how we get down the cost of health care and make it available and affordable to all americans. obama care is going to bankrupt this nation. >> hugh you have a question for the center? -- do you have a question for the senator? senator, you stay there. >> can i ask you one afterwards? >> we must never fight another conventional war against an unconventional and a maid. -- unconventional enemy. you agree? shouldn't we be building a state of the arts refinery rather than shipping 30 oil to houston where it will only be shipped to some other place in the world? thank you.

>> mike is here with us today. they lost their son in iraq. thank you for being here. [applause] everybody involved in the one organization, thank you for all you do. the town hall meeting in 2006, matthew's mother -- matthew was killed. he asked me to wear his bracelets, and i have been wearing it ever since. now i am very pleased they have named a bridge after him. that is one way to recognize his sacrifice. every time of war has been over we have made predictions about the next conflict.

after world war ii we were never going to have another conflict on the ground. all of a sudden, we found ourselves embroiled in korea. i think the chinese are a great challenge. many of the things they are doing is not in keeping with the maturity of a world power. there will be tensions in the region, and whether those lead to conflict or not, i do not believe so, but we have to be prepared. i would point out i don't think this issue of radical islamic extremism is going to go away in our lifetime. i think we will always be contacting people who want to destroy everything we stand for and believe in. i think we have made progress, but i think we are a long way

from winning this conflict, up because of long as there are places in the world for these kinds of ideologies are embraced and practice, you are going to have people who want to attack and destroy a america, so i am very worried about our cut some in spending, and i am worried about the impact of encouraging our adversaries, but i am also worried about american leadership. the world expects us to leave. in the arab spring there was not a single sign of the burning of the american flag. there was a commitment that they could be like us, democracy, freedom, human rights, individual rights, so i believe there are tectonics' changes taking place in the world, and the arab spring is not just in the arab world. i believe vladimir putin is

being touched by it. vlad and i have been exchanging thoughts, in case you missed it, but i really believe a lot of changes are taking place, and this universal yearning of freedom and god-given rights is going to cause changes around the world but we cannot predict. all of these dictators are not now in power. get a couple months ago nobody believed there would be massive demonstrations in moscow, so we had to be prepared, and i am sorry for the long answer. >> i want to add something to the same topic before i answer your question. i believe in having extraordinarily substantial and superior military might. i believe in having an -- right now we have 280 ships, and the

navy said we needed at least 313 to meet our missions around the world. i want to raise it to 15 ships around the world. we have fewer ships in the navy then we have ever had. i want to make sure we have 11 aircraft carrier task forces, not just because we need to win wars, but we need to prevent wars. ronald reagan used to say four wars began in his lifetime and not one of them was because america is too strong. in the defense department i am going to use those savings to make sure we rebuild our armaments and also to make sure we can care for the veterans.

good whole lot of them are coming home mentally and physically damage, and i would like to add to our troops. i will not shrink our military. with regards to where we put our refineries and how they work, if we have of risk of our hurricane-type crisis but would put america's economy at risk, and we are going to have to find ways to solve that by having the backup systems elsewhere. if that is the case, we are going to have to make the investment to put those backup facilities in place, but i can also tell you it is massively expensive in some places. there is not only the cost of getting the will to the facility but the cost of transporting that into the marketplace -- getting the oil to the facility but also the cost of transporting it to the marketplace. if you have ushered in -- have a shirt on, it shocked me to know what the cost of manufacture was compared with a cost of getting it into your home, and

distribution is a huge cost in our society, so as we change places for our refineries, we change our distribution, but is it puts us at risk, i will take care to make sure we provide for the american people in some of the end of the weather catastrophe. -- in an event of whether catastrophe. >> i am chinese, and i am american, and i love this country. i heard all this degrading stuff about china, and it does not make me feel good. i love my country. i have three children.

i work, i pay my taxes, and i vote. i have a question for you. to continue with the young man's question, it sounds like an big corporations have standard tax cuts to. new you know how many jobs they created after the tax cuts -- do you know how many jobs they created after the tax cuts, after 20 years of economic trickle-down theory, it did not help me. my tin can is still empty empty. >> can you tell me where it is better to live than america of? can you tell me anywhere in the world where the income is better than america wrote? >> i love this country. good >> so do i. >> [inaudible]

>> she said she loves this country and do not put any asians down. i hope i did not put any asians down. i welcome people from all over the world. we are a nation of immigrants, and i welcome people who come here from other lands. i love legal immigration, and if i am president, and we will have more of it. the income per person in america is 50% greater than europe, and if you look around the world and other societies, why their income per person is far less than ours, so hours may be far less than perfect, but it is a lot better than anything else the world has seen, so i think we should find ways to improve the system and we have than to find something better, because i think the principles on which

this nation was founded are the principles that have the best prospect of putting all of our citizens with greater prosperity and greater peace. >> i admire china across economic success. it is literally a mere cog, and the fact they have become a world power, but i have to tell you when you take people using the internet and throw them in jail, when you imprison nobel prize winners, when you take away the ability to elect their own leadership, when you carry out a totalitarian form of government, i cannot and mire that, and i expect progress on the part of the chinese towards democracy. [applause]

>> now that the troops are out of iraq, and do you plan to form a military alliance with iraq to avoid further conflict in the area? >> i will let you start with that one. >> i will be as brief as possible. we started the conflict in iraq because we believed saddam hussein had weapons of mass destruction. history will show whether that was the right thing to do or not, but at the time there was a belief at saddam hussein have weapons of mass destruction, and he was removed. and the conflict was ms. handled badly, and casualties started to mouth every day and was handled badly, and casualty started to mount. -- the conflict was handled badly and casualty started to mount. we succeeded in a surgeon and basically bringing under control. -- and we succeeded in the surge and basically it under

control. this president said he was going to get out of iraq. he fulfilled his campaign promise, and of course things are a serious situation in iraq as most of us predicted if we left her without leaving behind a residual force. iraq is unraveling, and the tragedy is it did not have to unravel, and 4474 brave young americans gave their lives. >> thank you, senator. those of you who followed my

comments about iraq know that i was very critical of the president's failure to establish an agreement that would have allowed our forces to remain behind to transition to the iraqi military. the secretary of defense said we would put something of that nature in place to keep troops in place, and the president failed to exert his own leadership to do so, and the consequence of that is unknown at this stage, but the danger to the success of our mission and the sacrifice made there is great. by virtue of your president following some agenda hard to understand in a setting like this. it is hard to understand, the deficit, the economy. there is no question there is going to be every effort on the part of the president to distract the american people from the president's record, and we are going to have to be bringing it back day in and day out.

he is going to attack on every basis he can find, but he will not want to talk about his record, and i believe we can bring it home, and we will allow him to return to the private sector, which i think he will enjoy enormously. [applause] he is going to take your microphone. he is going to run away from it. >> i am a student, and one of my main concerns are the paths that unemployment is taking right now, so i am wondering if you were elected president what would be your plan to a limit the amount of welfare and unemployment a tendency our nation is trapped in? >> i would like to see an unemployment system where people had an unemployment account, where they are putting money

into and on insurance -- and unemployed insurance account and they could take that money out. they could use it for job training or unemployment benefits, and that would give them incentives to move back into the workforce. i liked the idea that people receiving welfare assistance have the option of working. we made great progress, but when i was governor, a 80% of the people on welfare assistance in my state had no work requirement, and i wanted to increase the work requirement. i said even if you have a child two years of age you have to go to work. people said that is heartless. i am willing to spend more giving take care to allow those parents to go back to work. it will cost the states more, but i want those individuals to have the dignity of work and get people back in the workforce.

[applause] i will mention one more thing that is raised by your question, and that is in this country, let's say you are as young woman. you become pregnant. if you marry the father, the benefits you are entitled to will go down substantially. your qualifications for medicaid is not likely to be there because they will combine your income in calculating eligibility, so we encourage people not to get married. that makes no sense to me. i want to encourage people to get married because i think the ideal system is aware of mom and dad are able to devote themselves to caring for the child. [applause] front row. we decided to save a little money on microphones here. >> my name is roxy. my mom is here from tucson, ariz., visiting.

our question is we are very concerned about and border control. i grew up in tucson, and i know giffords is very passionate about the border control. senator mccain, we would love a personal response from you, and we would love to see you on the ticket with mitt romney. will you be on his ticket? >> thank you, and the temperature in tucson is 75 degrees today. >> we will check back in the summer and see how it is. >> our borders are not secure. they are more secure than they were some time ago. we need to do a better job to get our borders more secure. the issue is not just people who come across our border illegally. this issue is that we now have a problem with drug smuggling,

which is a threat to the existence of the government of mexico, atrocities and murders being committed in such an outrageous and incredible scale that it defies the imagination. children and women all fall victims to these ruthless people, drug dealers, and they are smuggling those drugs through mexico, arizona, through phoenix, where it is distributed throughout the country.

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>> to find out more about the president of three reset -- recess appointments, we spoke to a reporter. >> steven dennis, the white house correspondent from "roll call," joins us. the house and senate have been meeting in pro-forma sessions every two or three days to prevent the president from making a recess appointment. but he went ahead with it. why did he do it? >> sort of a kick in the eye to republicans and red meat to his base. a lot have been calling for the president to do this for months. it is interesting that he did it today, when there is some constitutional question about the legality of the appointment today, instead of yesterday, when there was a general sense he could have done it, once last year's legislative session ended and the next one started.

but i don't think the white house cares about that. i think they are happy to see republicans fighting this issue on a process basis, whether or not he has the authority to do this -- or they get to go to ohio and have a big campaign- style rally and make it an issue about who is standing up for the little guy. so, i think the white house was more than happy to make this fight and have the republicans talking. >> what have you heard from republican leaders so far after the announcement? >> mitch mcconnell was sharply critical. he said that the senate is not in recess. we are having these pro-forma sessions. he says this is legally questionable. speaker boehner went a step further and says he expects the

court to rule that this appointment was illegitimate. other republicans expecting court challenges, expecting the nomination to be thrown out. but in the meantime, you know, there is a question of whether this sort of hurts obama's ability to get things done with the republicans, because they are clearly incensed by it. but if you are the white house, you are not really expecting that much cooperation. you do not feel you've gotten that much from republicans anyway. in the meantime, this is something that shows your base that you are fighting and that you are taking action. where there is so much frustration that so little is getting done, the president is sort of putting a capstone on his "we can't wait" campaign on executive actions while he waits for congress to do

something significant on the economy. he has a big jobs package he proposed last year, and all they got in the end was a two- month extension of existing policies. he did not get really anything he talked about today, like construction workers, road projects, teachers. he mentioned all of those things today. those are all of the things he proposed a month ago that have gone nowhere. you know, there really does not seem to be much downside for the president here, in that he was not getting what he wanted from congress anyway -- so why not take the step? the other thing is republicans really picked the fight. they are the ones who said, "we do not care how qualified the guy is for the job," that unless you changed the job and basically turned it into a much weaker position -- >> you mentioned a possible court fight, but what about the

news report that says he may take the office as early as friday? are republicans likely to try to prevent that, and how could they do that? >> i do not think they will try to prevent it. there is also a question of who will have standing to go to court. it could be a situation where he would have to take some administrative action against payday lenders, forcing them to comply with regulations, and then the payday lenders could go to court to say that this nomination was not kosher. and so it might be a very long, drawn-out process before you can get to that point. and, you know, in the meantime, i think the white house thinks this is going to be a political win for them. and the more the republicans fight it -- i think the white house is happy to have that fight and have it over whether or not we should be having tighter regulations of wall street and the financial

industry. that is a fight they feel confident -- even more confident on this than, say, health care reform, which is much less popular in the polls. >> stephen dennis ross covered the white house for a roll-call. >> you can read more at rollcall.com. >> on this morning what to do journal, the latest on the president or race all year in new hampshire. mitt romney supporter, congressman charles bass. also, a result of a poll on younger voters with the director of the harvard institute on politics. washington journal begins live at 7:00 a.m. eastern on c-span. >> i know president obama came in office. everybody les on the defense and military. people lean on the one part that

will make a difference -- lawmakers. lose the jobs in your district. that is where that falls. >> as -- ward carol provides 10 million members with news, information, and support. sunday, will discuss american tax dollars and how they are spent on the department at 8:00 a.m. -- 8:00 p.m. eastern and pacific on "q&a". >> the rick santorum campaign has moved on to new hampshire. the former senator held a town hall meeting last night at a nursing home in brentwood, new hampshire. this is one hour 45 minutes. [applause]

thank you for being here. it is really great. it is great to be back here in the granite state. i cannot thank you enough for this great turnout. people ask me repeatedly -- europe done well in iowa, but new hampshire is a different place. it is nothing like iowa. i say we are all americans. we all have the same fundamental values that our founders put in place. we hold these truths to be self- evident that all men are created equal. endowed by our creator with certain unalienable rights.

that is what makes america america. a country that believes in americans having rights individually. that person goes out to work to provide for themselves. government would be limited so they could provide for themselves and their families and raise that family in a way that is consistent with their moral beliefs. it is what made america the greatest country in the world. right? you believe in new hampshire what they believe in iowa and south carolina. i bet you also believe that this government under barack obama is undermining that basic principle of what america is all about.

he has systematically destroyed the work ethic. how? by the narcotics of government behavior. -- government dependents. systematically going out and ever expanding the reach of the federal government. why? he believes you are incapable of freedom. let me say that in simple terms. he believes you are incapable of freedom. he believes you cannot provide for yourself, and that the government has to dictate to you all of the basic needs. all of the basic wants of society have to be organized and orchestrated by the federal government. that is why we have obamacare, because you are simply not capable of going out and working, providing, buying food, being able to provide for your transportation and housing. they would provide for your recreation. you are not capable of being

free enough to go out and contract and provide for yourself, with your employer or individually, to provide for your own health care. you need the federal government to tell any employer and individual how much to spend, what plan to have, what access to care, and how much to spend on it. that is because the president who believes that you need him. remember? he went around in new hampshire and talked about hope and change. "believe in me. just believe in me. i can go to washington, d.c. and solve the problems." remember all the town hall meetings? people would get up and say, "you are going to help me and take care of this for me." remember that? he convinced you back in 2008. he did not snow the people of new hampshire, did he? he convinced the country. he almost won here in new

hampshire. he actually won in the general election here in new hampshire. he convinced the american public that you needed a president that you could believe in. i am here to tell you that what i hear from the american people today is that you want a president that believes in you. [applause] so i have gone out and traveled the state. people say, "how are you going to do it in new hampshire? you have not been here." they forget. you might say they have not been paying a lot of attention to me for quite some time. they forget this is my 31st trip into new hampshire. we have done well over 100 town hall meetings. we have been traveling all over this state for over a year, talking to the people of new hampshire just like we did in south carolina.

according to "the washington post," governor huntsman has done more town hall meetings and i have in new hampshire, but he is cheating -- he lives here. he is just campaigning here. i did 381 town hall meetings in iowa. we will do a bunch of them this week. we have more events in south carolina than any other candidate in this race. i believe if you're going to ask the people of new hampshire, iowa, south carolina, and florida to support you, you have to show you can win in every area of the country. we are going to show, in a short time here in new hampshire, that we have what it takes to get the momentum and raise our numbers, and to say we are the kind of candidate the people of new hampshire can rally behind. because we are the kind of candidate that is going to go -- we will take questions in

the second. we will go and do this as president -- stand up and tell you the truth. [applause] tell you what the problem is. the very specific about it. i know you will be pulling up my sweater, saying "who are giving too much of an answer, giving too much detail." she has been chiding me about it for a year. but i believe the american public can be trusted with more, not less, information. right? [applause] people ask me, "how are you going to get america together?" how about starting with a common understanding of the problem? you have to be honest with the american people about what is the problem. maybe, once you do that, you would be amazed, based on the

values of this country, how we can work together to solve this. i am anxious to take your questions. i am going to go out there and be honest about what the problem is, tell you what i believe is the solution to this problem, and more important -- and it is important -- why i believe it is the right thing to do. it is not just what is up here, but what is here and here. it is important to understand this is what new hampshire does better. it is why you are here. how many of you have been to see other candidates in this go around? i am not surprised. this is what you do. this is your time, the first in the nation primary. you have a huge burden. everybody says this race is over. one candidate is way ahead and is going to win. not a vote has been cast. a lot of folks are trying to tell you, "here is the guy going to win." you fight.

i know bill gardner. you fight to be first. you have a responsibility that comes with it, and that is to lead. do not pay attention to what the polls say. do not pay attention to what the pundits say. how many pundits were right over the last six months about what was going to happen in this race? none. zero. they are worse than weathermen. so do not trust them. trust yourself. look at these candidates. look at them all. go to their web sites. come to town hall meetings. i am talking to the choir, here. do your homework. do the second thing you have to do in new hampshire. vote for someone who would do what america needs at a time when america needs a fundamental change in the direction of our government.

[applause] do not settle for a pyrrhic victory. do not settle for someone who can win, but then cannot do, will not do, and has no track record of doing the big things that are necessary to change this country, both from a standpoint of our economy, the standpoint of our culture, and the standpoint of our national security. that is what i ask you to do. that is what i asked iowa what to do. lead and be bold. this is not a time for us to shrink. this is a time like 1981, a time to have a bold colors, not pale pastels. the contrast between different visions. so, when you are attacked, as i have been throughout my political career, from the

left, stand up and say, "i did say this. this is why i believe what i said." yes, i do believe. here is why. you may not agree with me on every issue. i suspect you do not. but what you know is i agree with me on every issue. [laughter] [applause] people have said, how did you win in the state of pennsylvania? i hear it all the time.

i do not always agree with you how could you? there are only a few candidates. we cannot all run. right? they would say to me repeatedly, we know that we can trust you. we know that you are out there and doing it because you believe it is in the best interest of america. if that is what you are looking for when you turn the debates on in the fall and you are not afraid to turn your head and say, "oh, wow. he did not stand up for what we believe in. he did not stand up for the basic principle of american exceptionalism." you do not have to worry about that. it will be bold colors and a big contract. that is exactly what america needs. i believe it and i hope the people in america believe it, too. i will be happy to take your questions. [applause]

>> senator, santorum -- i am curious as to what your take is on the rulers -- i think it was lindsey graham or some senator -- who said he believed with confiscation of our 401k and individual retirement accounts. >> i would be stunned if lindsey graham said that. i would be disappointed if he did. [applause] i have heard this before. i know this has been proposed in the past as a way of financing things. let me assure you, there will be no confiscation of private property under this administration. in fact, one of the most reprehensible of decisions in the recent years with the taking of private property for commercial purposes by the

government. [applause] while i disagree with newt gingrich on some of his proposals with respect on how to deal with the court, they do go one step too far in separation of powers. i do believe we have to have a president whom when he stands up and takes the oath of office -- that is right. you have to say "i will defend the constitution of the united states." i will do that. if the court does not, then the president has to push back. this is one of the things i talked about. you have a lot of folks who say i believe this, i believe that, i believe this. that is wonderful. most of the people running here in new hampshire are running as conservatives. not all, but most. the question is -- what does the record say when the rubber hits the road where they are going to do that?

i would make the argument there is one person in this race who actually -- i actually talk about my record. last week, the pundits said i talk about my record too much. people do not want to hear about your record. they want to hear about what you are going to do. all of the other candidates are talking about what they are going to do my answer was if i have the record, that is all i would talk about. [laughter] i have a record i am proud of. those talking about the record and what they are going to do, when people look at the record and get the moment -- guess what happens? they do not hold up. when i say i am going to do something as president of the united states to push back on the supreme court when it goes against the constitution in and agree this way, i did. when i was in the united states senate, the court struck down the partial birth abortion ban act.

it was a nebraska statute that passed overwhelmingly in the house and the senate. when i had the opportunity when president bush came into office, i work with the house judiciary committee. we wrote a bill and said "you are wrong. this is not unconstitutional. we sat out two broad sections of the bill detailing to the court why we believed the court was wrong in their interpretation of the constitution. president bush reversed the decision. this is not an olive garden where the supreme court gets to make decisions and all of us have to bile. it is three equal branches of government -- [applause] -- we all are sworn to uphold the constitution, and i will. yes, sir. >> we hear about social security being broke.

i wonder if it would be very difficult to have a public assistance program and only pay social security to only those people who have contributed. >> social security is only for people who contribute to it. she asked if we should have a separate fund and only contribute social security dollars to those who have contributed to the system. a lot of you get confused with the welfare program ssi. it is not a social security program. it sounds like social security. it is not. it is supplemental security income. it is a general welfare program. it is a general fund program. it is a program for people who are, in most cases, disabled or claim to be disabled. social security is a separate, supposedly, a trust fund and a

separate revenue stream. your social security taxes, 12.4%, 6.2% side that the employer pays and 6.2% you are supposed to play, but only president obama are only paying 4.2%. you are paying less. that money goes into an account and is used to pay benefits. right now there is not enough money coming into the social security system to pay benefits, which go primarily to seniors who reached the eligibility age, which is roughly 66 right now. as you know, most seniors take social security at 62. right? so you have a social security old age and survivor benefits. that is someone who is a minor

and a parent dies. they get a benefit out of social security. the third area is social security disability. that gets confused with ssi because if you are disabled and have paid into it long enough, you are eligible for social security disability. it has different criteria than ssi. the problem with social security is that we do not have enough money coming in to pay the benefits. even if that 2% tax, which has been cut and extended for a couple of months -- you saw the big hubub about that -- there still would not be enough money coming in. you would get upset with me, but i would take you on a walk to the days of yesteryear everyone now understands that the retirement age is 66.

it is moving back to -- does anybody know? 67. ok? 67. when did that happen? i heard one right answer. the politicians who did this were absolutely brilliant. they passed a bill that did not take effect for 20 years, so nobody blames them. [laughter] it was brilliant. they increased the eligibility age by two years back in 1983. it does not phase in for almost 40 years. ronald reagan did that. most people had no idea. people do not associate ronald reagan with raising the retirement age because they did not know about it.

this is one of the beautiful things you see about congress. they have learned their lesson. right? all of the medicare changes, when did they take place? 10, 15, 20 years from now. we can do that under reagan when we're running $80 billion deficit and $100 billion deficit. now we are running $1.20 trillion deficit. $15 trillion and counting. we will have another debt ceiling increase. we are emerging in america. 42 cents of every dollar is being borrowed to fund the government. think about that. look at the young people here. we are saying to them, "this generation of people deserve to borrow 40 cents on the dollar and foot the bill to you." you are not going to get any benefit from it, you'll simply

just pay the bill. that is a pretty heavy burden put on the next generation. $15 trillion. you look at it now. we are managing it, but when the economy starts percolating, and it will under my administration, guess what else will start going up? interest rates. why? we have so much money out there. we will have to rein that in. how you rate it in? increased rates. right? you are going to reign it in and as a result, borrowing costs are going to go up. now you are talking real money. if we do not do something now -- rick santorum gets affected and we do what i say we need to do -- deal with the entitlement programs now, not 10 and 20 years from now -- you will know, unlike ronald reagan who may be was a better politician

than me, you will know it was rick santorum who got the american public together to fix this problem. why? because it's our problem. the problem with. obama is he does not want to gather you all together to fix this problem. he would rather divide and conquer. he would rather pit one group against the other. those who have purchased those who do not. in order for him to win the election and have no chance of getting anything done and passed the problem onto the next generation. we can no longer afford that. we need real leadership. [applause] yes, ma'am? >> my concern is about social security. i was amazed when i found out years ago that congress was allowed to dip into social security. now they want to raise the retirement age to 70, i have

heard. we earned that money. we worked hard for our social security. i hold congress responsible. why does the united states not hold themselves responsible for allowing democrats and republicans, whoever was in power, to get away with that? why is there no penalty? >> well, i love ronald reagan, but if i would point to one thing during his administration that he did seriously wrong, it was this social security fix. he bought the idea of increasing taxes now and reduce benefits later. that is exactly what the bill did. he increased taxes on workers in 1983 going forward and reduced benefits later. by increasing taxes as

dramatically as they did, what did they create? the social security surplus. the social security surplus was not a little bit of money. it was a lot of money. it was a 12.4% tax and -- employee and employer combined. they needed about 9% or less. they had a huge shock of it, 25% of the overall tax was in excess of what was needed to pay benefits. why did they do that? why did they not just match the payment to the benefit? well, they were going to build up a surplus. they convinced ronald reagan sadly enough. they convinced the american public they could build up a surplus. let's look at what they did with the money. the money came in -- 9% of the 2.4% payroll tax was paid out to the beneficiaries.

what happened to the 3.4% side? let's take $100 billion as a nominal figure. what happened to the surplus? what did they do with it? what did they actually do with that money? what was the transaction they conducted? they invested it in treasury bills -- special interest treasury bills. ok. they take the $100 million, take it out of the trust fund -- this is actually $20, but $100 million. [laughter] they gave it to the federal

government. this is a treasury bond. they gave them a treasury bond. what did the federal government do with the money? gone. what is over here? it is a piece of paper that says "the federal government owes the federal government $100 billion." so, they took more money from you in 1983 said they could create this piece of paper, spend more money in 1983, did you this piece of paper, and some day in the future -- now, because we do not have enough money to pay benefits -- we are going to take this piece of paper and do what? get another piece of paper, this time from the chinese, and replace it. i do not believe social security is a ponzi scheme, but this was a bad deal.

all we did was finance a bigger government in the 80s, 90s, and the last decade, and hide the real deficit that was going on. now we are paying the price because we have a huge government spending. it did not look as though we were in as huge a deficit. look at what happened. one of the reasons we have seen the deficit explode is because of obama policies. there is no doubt about it. the social security trust bond was in a positive position because we spent everything else. i have taken the position, not a popular one, i know -- what are we doing cutting social security taxes? we need that money to pay benefits or this is a big charade. there really is not a social security trust fund.

change is the way we want. increase taxes more, cut benefits more. i will take this one step closer -- i have been a supporter 15 years ago of personal retirement accounts for social security. i was a big advocate of that. [applause] when i was an advocate of that in 1987 or 1988, my only trip with bill clinton on air force one was 1997. i was a freshman senator. it was actually my second. i went out with bill clinton in kansas city to talk about how to reform social security. we had a great talk on that plane. we talked about how we would take the surplus at 3% and use

it, instead of creating this, which was phony, and larry summers and bill clinton knew it was phony, let's create a real asset that will actually pay benefits. bill clinton, to his credit, wanted to create an asset, but have the government hold the assets. in other words, corporate bonds and even some safe stop. the private-sector would have to pay it would be a real asset as opposed to this, which is simply a promise from the government to pay. i want it to be individually held, he wanted it to be government held. we were working on something, and monica lewinsky's dress fell off. [laughter] here is the problem now. that 3% we were going to use to create this real asset does not exist anymore. some people have suggested we

need to go to another system. who is going to finance it? who is one to give younger workers -- i am all for younger workers and a retirement account instead of social security -- but where will we get the money? we have $1.20 trillion in deposits. are we going to increase the deficit even more so we can borrow more money? you cannot be for that right now. we have to get our fiscal house in order. we have to adjust taxes and benefits on social security. how do we do this? this is my last point. how do we do this? other countries have done this. they create a formula, one that has to be on the benefit side. the formula has to affect benefits.

i believe we should curb benefits for higher income seniors. step back again. 1937. social security is put in place. what was the poorest age group in america in 1937? people over the age of 65. what is the wealthiest age group in america today? >> politicians? [laughter] [applause] >> ok, politicians over the age of 65. i will cede to that. the bottom line is, seniors are not the poorest people in america today. it is, in fact, younger workers. here is our conundrum. we have to fix it. what do we do? we say to younger workers we are going to tax you more and

give benefits to high income seniors who have paid into social security, or are we going to make you pay more, slow down the economy, hurt the economy, and take more resources out of you? i have a hard time seeing how that is fair. franklin roosevelt would not have seen that as fair. we need to look at changing that. there is a whole bunch of ways to do that. there are a lot of ways you can structure it so higher income seniors -- another thing -- dependent benefits. we have benefits that go to children of parents who die. absolutely legitimate. a lot of those children, though, also get benefits if the mother or father -- in both cases the father -- turn 65. the child of a 65-year-old gets

benefits. most of the 65-year-old dads i know usually are not hurting for cash. there are some things we can do. some little things and some big things. i do believe, and i know this is not popular, but after 67 goes we need to continue to move it forward. why? back in 1937 what was the retirement age? was the life expectancy of an american? 61. the eligibility age was set at 55. -- 65. social security was put in place for people so old they could not work. it was a program for people who

could not provide for themselves. today, the eligibility age is 66, average life expectancy is almost 80. at a time when seniors collect social security, 70% of seniors take benefits at 62. what is life expectancy at age 62? 85. you are going to be on social security benefits under the current system for the vast majority of people who reached the age of 62, they will be on social security benefits for 23 years. i am just saying that we are running a at $1.20 trillion deficit. this is not the only way we are going to solve this deficit. it is a piece of it. but the idea that we are not going to be honest enough with the american public and have this discussion to understand the problem -- here is what i will say to you -- let's solve it together.

you can decide as a society what we are going to do. are we going to curb of benefits are higher income seniors? are we going to tax and number workers? we can raise the social security taxes. we can tax younger workers more. we can do a combination of those things, i believe, based on the demographics. there is a preferential way. you may disagree. yes, sir. in the back. either one of you. you fight it out. >> if you should become president, what in the hell will you do to clean up washington so all of you politicians down there are not able to make use of insider trading? this is it legal according to

all of your rules or regulations. if anyone of us in this group did that, they would hang us by our funds. -- thumbs. the other part of it is cronyism, nepotism, and on and on. >> the insider-trading members of congress are being accused of is specific to members of congress. they are covered by the same rules as far as having knowledge of what a corporation knows. if they acknowledge and they trade on that, they are as guilty as anybody else. the unique thing is something we should not have a lot for. people should behave well. members of congress should be ethical. should they not? of course they should behave ethically. here is the problem -- when people do not behave as they should, we have to pass laws.

they are going to pass one, and i support it. then we have to enforce the law. then we have to have staff you are going to pay for to enforce the law. we are going to have all sorts of expenses? why? because people do not lead good, moral lies. all people care about is cutting taxes and cutting government. everything will be fine. if people do not make good decent, moral laws -- families and faith is an important part of the foundation of economic limited government. this is a classic example where everybody in this room is one to pay more taxes or your tax dollars are going to go to enforce a law there should not be a need for. why? because people should not do it. what they do is get inside information about a bill that

would affect a particular company and then go out and trade on it. you know that is wrong. i know that would be wrong. everybody should know -- guess what? well, a lot of people maybe do not have those values. yes. go ahead. >> getting back to what you are talking about, there are many social ills within this country that have absolutely no part of the dialogue. from wall street up to social security. ssi, what it is, who it really affects, and how you are destroying the moral fabric. what we have done to the minority community is a sham and an atrocity. what can you do to change that? >> it is not just the minority community. it is everybody affected by this culture of entitlement. the reason i am in this race -- the principal reason -- is

because of obamacare. i think obamacare will turn every american into a dependent american. someone who will be reliant on the federal government. [applause] right? just remember a few months ago when president obama was fighting with congress about the debt ceiling. what did he do to get his way? do you remember? he did a press conference. he looked into the camera and said, "if congress does not pass this debt ceiling and you do not call them right now, you are not going to get your social security check. you will not have your medicare bill paid. you, the spouses of our men and women overseas, are not going to get your check." you are dependent upon the federal government for your life. the more dependent he can make you, the more power he has over

you. this is a tipping point. obamacare is the tipping point in our country. right now, we have talked about -- legitimately so -- there are a lot of people on the margins of life. some who are fall gently, -- fraudulently and illegitimately getting some of these resources for being disabled. ssi is historically are rife with problems. particularly children getting ssi. i dealt with this when i worked on the welfare reform bill. if you want someone who as a long, storied track record, and a good one, of dealing with these issues -- when i was on the ways and means committee, i repeat reform bill. i was a ranking member on that subcommittee. when i came to the senate, i ended up managing the bill and working with president clinton

and getting a bill signed after he vetoed it twice to end welfare. he bought read the programs, got rid of the federal entitlements. i was the principal author of it in the united states senate, managed the bill on the floor. we stopped the entitlements. we capped the funding. we would not allow any increase in funding. did the responsibility back to the states and set two requirements. there were two things i root refused to compromise on. work requirements and entitlements. poverty is not a disability. it is a temporary condition. the expectation is the government will give you a temporary hand and give you the assistance to turn your life around, but you will do so or you will stop receiving benefits. guess what happened? the welfare rolls were cut in half in america in places like

wisconsin. it was cut by 92%. employment went up among the very people who the left contended would be standing in bread lines. no, they were selling bread. it was a fundamental change in america. guess what happened? poverty levels went down to the lowest levels ever for one of the areas that have the highest levels of poverty is starkly, which is african-american children. the idea that republicans do not care about those on the margins of life because we do not vote for these programs to provide for them, it is just the opposite. we do care and that is why we want to stop these programs from providing and creating that dependence. you've already asked a question. let's go to someone way in the back. yes, sir? yes, sir?