nothing. now you have kids with their pants off their hips and they are committing crimes. guest: cartoons are so popular for children and adults. it is really the parents' responsibility to ensure that their kids are not -- may be their kids should not be seen. maybe they should be watching a sprout. other channels that are really geared towards children. one of the main arguments for the broadcasters is more personal responsibility on the part of the parents. host: when might we see a ruling on this? guest: we are expecting something in july. host: thank you for your time

this morning. as always, we will see you back here tomorrow at 7:00. every day at 7:00 for "washington journal." we take you live to the center for american progress in dc. it is a conversation with alan krueger. talking about issues involving inequality as some folks say it about the middle class, the economy, at large. it should be maybe one hour or so. live coverage here on c-span. hope you enjoy the rest of your day. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012]

once again, we are live this morning at the center for american products in washington. a discussion of the dangers of inequality and how it threatens the middle class. hear, the chair of the president's economic advisers, dr. alan krueger this morning. talks about why a payroll tax cut is of vital to the economy. some economic news out this morning. congress reported that retail sales pulled a record for $0.70 trillion. -- $4.70 trillion. another report said that new applications for unemployment benefits jumped almost 400,000 last week. from the associated press this morning, nato and afghanistan

calling a video of u.s. soldiers urinating on what appears to be a dead -- on a dead caliban fighters -- a pile of dead fighters.ghtertaliban the video is being called in humane. nato says the soldiers who appear in the video appear not to be in afghanistan any longer.

>> good morning. welcome to the center for american progress. my name is neera tanden. i want to thank you you for joining us. i want to welcome alan krueger to the center. he wants to discuss how rising inequality in the united states is a threat to our middle class. he has been engaging in a broad body of work around this. we are excited to kick off the discussions this year. we are very lucky to have him here at this point in time when

the nation is really engaged in a debate about american's growth and how much and how important a thriving middle class is to that growth. i think on a regular basis, we talk about a strong american -- a strong middle class. these ideas have become, in some ways, almost a cliche. i think it is important for us to remember that the actual notion of a strong and vibrant middle class is the most important ingredient to a strong economy. a growing economy. a point that is uniquely american. the united states model that was developed in the 21st century of a series of proposals in the public and private sector and

insuring that growth is scared has -- is shared has been fundamental to american strength. while we debate it back and forth, it is particularly important as progress is that we recognize how -- as progressives is that we recognize how important it has been. a thriving middle-class is under attack. we have been going through economic change and dislocation that has made people very wary of the economic challenges we face. we would like to focus the conversation of economics on where we are today. i think from the perspective of the center, we have to be reminded of how much the roles have really changed. how conservative economic

policies have really hindered growth for the middle class. just a few statistics i would like to cite. in 1966, the richest americans held just 9% of all income. today, they take home almost 24% and control 40% of the nation's total wealth. they have seen their share of the national income fall. a child born into poverty after world war ii -- only one in three would get that kind of shot today. when we think about that promise of the american dream and we think of ensuring that we have opportunities for all americans, we have to recognize that is a real question today. some of the stuff we have seen in the political debates

challenge that. at its core, our country is wrestling with how do we ensure our children have that same opportunity and fairness that generations previously had. this is why i think the president's speech last month in kansas was so important. he really located this debate in terms of the long-term struggles we have had in wrestling with those policy and economic issues about how we have to ensure that the middle class received that sense of fairness. that wariness that the american dream is no longer alive for everyone is really in our politics today. one quote i would like to read from the president's speech is, "what this -- what made this country great has eroded.

he went on to say, "our success has not just been about -- it has been about building a nation where we are all better off." that is why we are so excited to have alan krueger here today. there is no one i know in the field of economic policy who has dived deeper into that question of ensuring how we can have policies that ensure we are all better off. i meant him two years ago. we worked together on health care reform. he was a star in the field of economics. he combines an economics rigour with a warm heart. he really has spent his career diving in to these important issues around policies.

which is, why do people do what they do? how can we ensure a public and private sector -- that we are making policies that work for everyone? that we focus on at -- that we focus on economic opportunity for all americans and ensure that we are doing the right things by all americans. that is the set of values and approaches that he brought every day to our discussions of health care reform. and what he does every day. now as chairman of the economic advisers. i cannot think of a better person when struggling with these questions about inequality and shared values to have here with us then alan krueger. alan? [applause] >> that was a more dramatic

transition then i was expecting. thank you everyone for inviting me here today. i want to congratulate you for becoming the president of cap. i know it is not easy to follow in your predecessors of footsteps, but i am sure you can. as you mentioned, we worked closely together on health care reform. what i remember most about you from those days was how cheerful you were at every meeting and have dedicated you were to the goal of expanding health insurance to all those who could not afford coverage or who had been denied coverage for reasons of previous health conditions. will return to this issue at the end of my remarks. the topic i will address is an apology. as you know, in a labor economist. labor economics is studying work and pay.

it occurred to me that labor economics can also be described as an attempt to understand inequalities' related to the job market. although i have done much research in my career on inequality, i used to have an aversion to using the word "inequality." in fact, the wall street journal once run -- ran an article in the mid-90s that preferred use the word dispersion. but the rise in income dispersion along so many dimensions has gotten to be so great, that i now think inequality is a more important -- appropriate term. the rise of inequality in the u.s. over the last three decades has reached the point that inequality in income is causing an unhealthy division in

opportunities. and it is a threat to our economic growth. restoring a greater degree of fairness to the u.s. job market would be good for business, good for the economy, and the good for the country. president obama summarized the rise of inequality very successfully in his kansas speech when he said, "over the last few decades, the runs of the ladder of opportunity have grown farther and farther a part. the middle class has shrunk." these trends are well documented, but worth reviewing to understand the implications. if you indulge me, i will show you some charts. the first chart shows the annual growth rate of real income for families in each 1/5 of the

income distribution over two periods. the figure shows that all 1/5's put together from the end of world war ii to the late 1970's, but since the 1970's, income has grown more for families at the top of the income distribution then in the middle. it has shrunk for those at the bottom. we were growing together for the first three decades after world war ii. but for the last three decades, we have been growing further a part. here at cap, i should point out that the pattern during the post-1970. is not monolithic. the next chart shows the period from 1992 to 2000. this period was an exception. strong economic growth and the

policies of the clinton administration led all segments of the income distribution to grow together again. indeed, all income groups experienced an increase in income for years in the spirit from 1992 to 2000. i can also note that parenthetically, there is no sign in this data that the tax increases of the early 1990's had an adverse affect on income growth. the next chart shows the level of income earned by the median household each year after adjusting for inflation. half of households burn less in the meeting, have earned more. the median is right in the middle. you concede that the median household saw a decline in real income in the year 2000. it is the first decade of the 2000's -- if the first decade of

the 2000's had sought the growth of the 1990's, middle-class families would have an extra -- to spend on their mortgages, rent, food, or to add to their savings. the next chart shows how much after-tax income has grown for parts of the income distribution since 1979. again, after adjusting for inflation. this is based on a different source of data from income tax returns. the numbers are from the nonpartisan congressional budget office. the congressional budget office noted in a recent report that the top 1% of families sought a 278% increase in their real, after-tax income from 1979 to 2007. the middle 60% had an increase

of less than 40% in this period. because of these trends, the very top income earners have pulled much further ahead of everyone else. the following chart shows the share of all national income by the top 1% and 0.1% of households. not since the roaring 1920's has the share of income going to the very top had such high levels. the magnitude of these ships is mind boggling. the share of all income growing to the top 1% increase by 13.5 percentage points. that was from 1979 to 2017. this is the equivalent of giving -- to the top 1%.

put it another way, the increase of the share of income over this. it exceeds the total amount received by the entire bottom of 44% of households. as a consequence of the momentous shift in the income distribution that i have just described, the middle-class has shrunk. the next chart illustrates this development by showing a percentage of households whose income falls within 50% of the median. that is, we placed a -- around the middle, plus or minus 50%. we calculated households that fell within this band. we found that just over half of all households with income of

50% of the median in 1970 to -- the middle class has been shrinking for some time. my friend from harvard used the term "polarization close " to describe what is going on in the income distribution. we have more fat -- we have more families falling into the extreme end and far fewer in the middle. the statistical work for this i should note is cretaceous .erio i can see why polarization has caught on. higher income inequality would be less of a concern if low income earners became high income earners at some point in their career or if children of

low income parents had a good chance of climbing up the income scales when they grow up. in other words, if we had a high degree of income mobility, we would be less concerned about the degree of inequality in any given year. but we do not. moreover, as inequality has increased, evidence suggests that year to year, generation to generation, economic mobility has decrease. recent work finds that a worker's initial position in the distribution is highly predictive of how much he or she their career.er in studying takes -- studying tax data, for example, find that

income mobility over the career has been stable since the 1970's when all workers are considered as a whole. for men, however, there has been a decline in income mobility over their career since the 1970's. this decline has been offset by an increase of four women, but a different pattern for women is probably a result of changing the labor force attachment over their career rather than an increase in career mobility due to a fundamental change in the operation of the labor market. more research has been done on the question of intered generational income mobility. -- inter-generational income mobility. studies that followed data over long periods of time between

parents and children find correlations between parental and child incomes. a reasonable summary is that the correlation between parents and their children's income is around 0.5%. this is remarkably similar to the correlation that was found between parents height and their children's height over 100 years ago. this fact helps a correlation income between parents' and children's income in perspective. a child born to a family in the bottom 10% of the income distribution rising to the top 10% as an adult is about the same chance as a dad who is 5'6" tall having a son who grows up to be over 6'1". this happens, but not that

often. another statistic between parents and children as income is called the inter-generational income elasticity. this means that if someone's parents earned 50% more than the average, their child can be expected to earn about 20% more than the average in their generation. as was recently highlighted in "the new york times," parental matters more for success in the u.s. than a dozen other economic countries. new research from the university of ottawa finds intriguing links between inter-generational

inequality and income inequality at a point in time. countries that have a high degree of inequality also tend to have less economic mobility across generations. we have extended his work using after tax and income inequality data. i can assure you this in the next figure. this figure shows a scatter diagram. it is the relationship between income mobility across generation, that is on the vertical access. -- vertical axis. thatality in the 1980's, is on the horizontal axis. each point here represents a country.

higher values along the horizontal axis represent greater inequality in family resources, roughly around the time that the children represented in the vertical axis were growing up. higher values on the vertical axis indicate less economic mobility across generations. i have called this curve "the great gatsby curve." this indicates that countries that have more inequality across households also had more persistence in income from one generation to the next. but documented at the beginning of my talk that the u.s. has seen a very sharp rise in inequality since the 1980's. if this relationship across

countries holds in the future, we would expect to see a rise in the persistence in in come across the generations in the u.s. as well. that is, we would expect to see mobility decline because of the trends that have taken place over the past few decades. while we will not know for sure whether and how much income mobility across generations has been exasperated -- i should say in come in mobility across generations has been exasperated in the u.s., we will not know this until today's children have grown up and completed their careers. we can use the great gatsby curve to make a rough for test. the next figure displays this forecast.

what we have done is to take this relationship and say, we know that since the 1980's it has increased in the u.s., but plug in that increase and make a projection using this line to project how intergenerational mobility will change in the future. if you want to see this again, we can probably go to instant replay. each point shows five years. this is a sobering prediction. that is an excellent question. this is not quite in a steady state because the way to read this is -- this is for roughly

today's children and when today's children have grown up. i will be happy to take questions afterward. so, how we interpret this? what the figure shows is that this intergenerational ls the city is expected to rise from 0.47% to 0.56%. in other words, be in advantages -- the disadvantages of income is expected to rise about one quarter from the next generation as a result of the rise of inequality that the u.s. has seen in the past quarter of a century. it is hard to look at these figures and not be concerned that rising inequality is jeopardizing our tradition of equality of opportunity. the fortune of one parents seem

to matter increasingly in our society. children of wealthy parents already have much more access to opportunities to succeed then to parents of poor families. this is likely to be the case in the future unless we take steps to ensure that all children have access to quality education, health care, a safe environment, and other opportunities that are essentials to having a fair shot at economic success. next, i will describe and discuss some of the causes of the trends we have seen. as a labor economist, i feel compelled to talk about causality. in a mechanical sense, much of the rise of household income and equality in the u.s. have been traced to arise in the average earnings. other factors, such as the

number of workers per family and family labor supply decisions, also matter. but understanding why the dispersion in wages has changed is key to understanding inequality in america. there is considerable professional disagreement about the causes of income disbursements -- of income dispersion in the u.s.. in the mid 1990's, i did a poll of eight non-random group of professional economists attending a conference at the federal reserve. i asked them to the extent to which various factors contributed to the rise of inequality. this survey, which was meant to give me a rough idea, took on a life of its own. it was reprinted in the economic report of the president in 1997. then it was reprinted in "the

new yorker" magazine. this is clearly a complicated dynamic that has changed the u.s. labor market. nonetheless, it gives a rough sense of the way economists think about these issues. the most important factor, according to respondents, was still biased technical change. a lot of activities that people do at work have become automated as a result of computers and information technology. much of this automation has favored people with the analytical skills to get the most out of the technology. i like to say, we have got from to "the jetsones" since." -- to "the jetson's."

attributing so much of the rise to shifts in demand across skill groups as a result of technological change can be a little bit misleading because there has also been a slowdown in the growth of the supply of relatively high educated workers in the u.s. during this period. while the economy has continued to demand a more highly skilled workers because of technological change over the last three decades, we have not increased our supply of highly educated workers as the same rate we have done previously. if you return to this poll, it shows the humility of economists. the second most common fact recited was under an unknown.

-- utter and unknown. i think we have come to know -- other and unknown. i think we've come to know more about this since then. the proportionate people in the top 1% who were from the finance or real estate industry nearly doubled from 1979 to 2005. in 2005, executives from the financial and real estate sector made one quarter of all the income of the top 1/10 of 1%. another factor in my palm a matter now more than it did before -- that is, increased globalization. the number of workers against to the american labor force

competes has jumped. some have benefited as demand for the goods and services they provide have risen. but other workers have been left behind by globalization. the 2000 saw the worst record of job creating in 50 years. that was the case before the recession that started at the end of 2007. recent research suggests that china's very rapid adoption of cutting edge technology in many industries has had an even more profound affect on labor demand in the u.s. in 2000 than it did in the 1990's. there have also been important institutional changes that have contributed to the rise of income inequality in the u.s.. union membership declined from 20% of employees in 1983 to 12%

to today. this is important because unions a fact the wage structure primarily by lifting the wages of lower and middle class workers into the middle class. in addition, the decline and real value of minimum-wage in the 1980's contributed to the rise of inequality as david lee and others have pointed out. lastly, i want to know that tax policy has played a role in rising inequality. although our tax code is still progressive, tax changes in the early 2000's favored wealthy people much more than other taxpayers. that compounded the widening gap in pre-tax incomes.

as a result of reduced progressivity, the wealthy are now paying some of the lowest tax rates in the history of the united states. average tax rates for the wealthiest 1/10 of 1% have been in decline for five decades. it should also be noted that our tax system is less progressive than that of other countries. this chart shows other countries. the blue bars indicate inequality in before-tax income. the red tax shows inequality in after-tax income. the difference and height between bars is a measure of how much the tax code reduces inequality. of all of the oecd countries, only chile, korea, and switzerland have tax systems that produce inequality less

than the u.s. now, i can see why someone could support tax cuts to the top income earners if they had materially benefited the u.s. economy. but the macro evidence is clear that the economy did not perform any better after last decades of tax cuts than it did after taxes were increased on top earners in the early 1990's. i already showed you evidence that income growth is stronger for lower income families in the 1990's than it was in the last 40 years overall. this next chart shows that there was more job growth in start ups in the 1990's than in the 2001 to 2007 period. across all businesses, job growth was much smaller in the

2007 than in the 1990's. there is little support for the claim that reducing the progressivity of the tax code has spurred income growth, business formation, or job growth. next, i will discuss three potential consequences of rising inequality for the economy. i have already presented evidence suggesting that as inequality rises, the prospects for intergenerational mobility fall. support for inequality opportunity should be a non- partisan issue. it is hard not to bemoan the fact that because of rising inequality, the happenstance of having been born to poor parents makes it harder to climb the ladder of economic success. there is a cost to the economy

and society when children from low income families do not have anything close to the opportunities to develop and use their talents as the more fortunate can from better off families who can't attend better schools, receive college prep tutoring, and draw on a network of family connections. one would think it inexcusable that public policy has exasperated this trend, but that is exactly what has happened over the last decade. as i mentioned, income-tax changes has made the distribution of after-tax income more unequal -- not less. moreover, the drastic cut in the estate tax will produce economic mobility in the u.s. going forward. as the tremendous resources accrued by the wealthy can now be transferred to their heirs at much lower tax costs.

two men have suggested a second way in which rising inequality and slow income growth for the vast middle class have harmed the u.s. economy. namely, by encouraging many families to borrow beyond their means to try to maintain their consumption and by reducing aggregate demand. in his book, "fault lines," he goes so far as to argue that this over leveraging as a result of increased inequality was a significant cause of the financial crisis in 2008. in the spirit of a man from the earlier era, he argues that an increase in inequality has reduced aggregate demand because the well off have a lower

professional propensity to consume than everyone else. while one could reasonably expect all families consume their permanent income, or lifetime income, over the course of their lifetimes, studies have found that the marginal propensity to consume is lower at higher income levels in the short run. and, one might expect that the reduction in the estate kass to -- one might expect that the reduction in the estate tax would be reduced since inheritance is would be taxed at a lower rate. while the potential drag on aggregate demand from the income distribution is hard to document, the following calculation makes it clear that it could be substantial.

as i mentioned earlier, the shared income going to the top 1% increase by 13.5% points from -- that is equivalent of about $1.10 trillion per year. families at the top of the income is distribution is scarce. according to research, the top 1% of households saves about half of the increases in their wealth while the population at large has a general savings rate of about 10%. this implies that if another $1.10 trillion had been earned by the bottom 99% instead of the top 10%, it would be about $44 billion higher. this would be a 5% boost to consumption.

there are many caveat its attached to this calculation. -- caveats attached to this calculation. particularly does the propensity to consume are not well known in the upper end of the income distribution. and this does not say that the rise of inequality -- because households could have, and many probably did, borrow to make up for weak income growth. but the scope for such a borrowing has clearly come to an end. this calculation indicates the kinds -- the kind of latent pressure that could be placed on aggregate demand as a result of the changes we have seen in the income distribution. now that we are in a period of excess capacity, i think these calculations make clear that the economy would be in much better

shape and demand would be stronger if the size of the middle class had not dwindled as a result of rising inequality over the past decade. -- over the past decades. president obama made this point very clear in his kansas speech. "when middle-class families can no longer afford to buy the businesses and services that are being sold, it is a drag on the entire economy from top to bottom." the third line of research on the consequence of rising inequality that i want to mention is that there has been an active force examining the connection between inequality and longer-term economic growth. in a paper it was argued that in a society where inequality is greater, off political decisions are likely to result in policies

that lead to let's -- to less growth. a new paper from the imf also finds that more equality in the income distribution is associated with more stable economic growth. less equality is associated with more in stable economic growth. more fluctuations. historically, the growing middle class has led to new markets, supported economic growth, and build stronger communities. the studies on inequality and growth may have found an inverse relationship between those two variables for that reasons that were pointed out two decades ago. because the top has to save rather than spend their incomes. or for other reasons that were

emphasized about excess borrowing. while research on the economic consequences of inequality is controversial, there is a much -- there is microeconomic evidence that in my view convincingly finds that wage discrepancies can be bad for employee morale and productivity. in one recent, randomized failed experiment, it was found that raising pay for workers who felt that they were underpaid substantially increased their productivity. but raising pay for those who did not feel underpaid had no effect on productivity. in another experiment, it was found that increasing the disparity in pay between pairs of workers decrease the productivity of both workers combined. these studies and others suggest

a more fair distribution of wages would be good for business because it would raise morale and productivity. this is in addition to any of fact that the increase in size of the middle class would have on the demand of the business's products. my theme that rising inequality has been bad for the u.s. economy was nicely anticipated. heather recently wrote, what we now know is that a strong middle class creates stable markets for businesses to invest. the decline of america's middle class creates real hardships for families and limits opportunity. but it also appears that the demise of our middle-class is a part of what ails our economy overall.

end quote. the next question to raise is what should be done to bring back more fairness to the u.s. economy. to ensure that hard work and responsibility are rewarded by a good shot at making it into the middle class regardless of where someone starts out. while this could be the subject of another lecture, let me highlight a few specific areas of public policy to include. first, i promise to return to the affordable care act. it is already helping middle- class families. it has been well publicized that an estimated $2.5 million -- an estimate to 0.5 million young people -- an estimated 2.5 million young people have been able to get more health care because they stay on their parents plans.

health insurance coverage did not rise for full-time students because they already had access to health insurance coverage. but it did rise for young adults who were not enrolled in school and to have parents with health insurance coverage. these are overwhelmingly responsible families who are working to maintain their position in the economy despite economic forces that have been working against them for decades. furthermore, when it is fully implemented, the affordable care act will help the middle class and those struggling to get into the middle class by lowering the growth of health care costs by preventing those with pre- existing conditions from being denied health insurance coverage by creating exchanges for small businesses and lower income families to obtain health insurance at competitive rates and by providing tax subsidies to small businesses with lower income workers to purchase

insurance. second, it is critical to take the steps necessary to ensure that the current economic recovery continues. -- continues to rebuild the middle class. although the economy has been expanding for 10 straight quarters, the right policy actions would strengthen economic growth. president obama proposed the american jobs at in september to strengthen the recovery and the job growth. among many measures to support the economy, the american jobs at included an extension of the payroll tax cuts through the rest of this year. it would put an extra $1,000 in the hands of a typical middle- class family. he also proposed continuing the extension of unemployment

insurance benefits. although congress has extended both of these measures until the end of next month, it is critical for the recovery that they are extended through the rest of the year. the american jobs act also called for expanded reemployment services and a pathways' back to work fund that states could use to help less skilled job workers find jobs. creating these opportunities for less skilled workers would get them back to work faster and help expand their opportunities in the future. third, i think it is clear that we cannot go back to the types of policies that exasperated the rise of inequality and threatened economic mobility in the first place if we want an economy that builds the middle class. this means that we must

adequately regulate excess risk taking and correct corrupt practices in the financial markets. it also means that we cannot go back to tax policies that did not generate faster economic growth for jobs, but rather increased inequality. instead of going backwards, we should adhere to principles like the buffet rule which states that those making more than $1 million per year should not pay a lower share of their income in taxes than middle-class families. we should also end unnecessary tax cuts for the wealthy and return the estate tax to what it was in 2009. we should ensure that all children have adequate nutrition, access to health care, a secure in cut -- a secure environment, and a fair shot at education regardless of their parents' background.

lastly, i want to emphasize that restoring more fairness to the economy would be good for all parts of american society. this is not a zero sum game. the evidence suggests that a growing middle class is good for the economy. and that a more fair distribution of income would hasten economic growth. businesses would benefit from restoring more fairness to the economy by having more middle- class customers -- more stable markets. it would improve employee morale and productivity. president obama put it much better than i ever could. i will quote him. "this is not about class warfare. this is about the nation's wealth -- welfare. it is about making choices that

does not punish people who have done well, but benefits the middle class and those fighting to get to the middle class and the economy as a whole." thank you very much. [applause] >> hello. thank you so much. this has been a fantastic speech. it is my honor to get a take on all of you for questions. in a senior economist here at the center for american progress. i would like to take the privilege of asking the first question this morning. witches, do you think that we can -- which is, do think we can pull this economy out and move into a full-fledged recovery without focusing on rebuilding the middle class? >> well, i think the two are united as i emphasized.

continuing to strengthen the recovery is extremely important to building a brighter future. we know from much evidence that downturns are likely to hit the lower and middle class people struggling to get to the middle class the hardest. an essential step is to ensure that the recovery continues. the economy is slowly healing. i think people understand that we're not going to solve them all overnight, but we are making progress. as we make that progress, we need a foundation for an economy that is built to last. that has more shared growth as the economy expands. that means investing more in

education. that means making sure that those who have access to higher education. it means investing in our infrastructure. i think it requires many steps, but in the near term staying focused on that recovery continuing is essential. >> i would like to open it up first to the questions from the press. >> [inaudible] my question is, do you believe the recent statistics on housing, auto sales, and a labor on unemployment suggest that there will be more economic

growth in 2012? >> that is a bit of a trick question because the council of economic and visors make the forecasts. we produce forecasts twice a year. the last one was over the summer. we will release our next forecast together with budgets. i do not want to get ahead of the budget process. if you look at the statistics that are coming in, it is clear that we are painting a picture of an economy that is slowly recovering. it is extremely important that we keep that momentum going forward. steps that i would highlight most importantly are extending the payroll tax cuts through the end of the year. extending unemployment insurance. the congressional budget office

concluded that out of all the measures it looked at, extending unemployment benefits have the most bang for the buck in terms of supporting demand, raising economic growth, and creating jobs. >> the trend of income equality was apparent. up with a tax policy, specific answer at all? >> we were in a different policy environment that we were today. the tax rates increase in nearly 1990's.ly we saw in a quality continue to rise in 2000. i would add tax policy for

causing a tremendous widening the we have seen in after-tax incomes. i have no idea. from my own perspective, tax policy, the tax-cut for the very wealthy -- i alluded to the large reduction in the stat estate tax -- has expanded in the u.s. >> yes. >> given that whaone in four home loans is underwater andone are 90 days past due, or will be to do anything until we address the differences

in mortgage values and home values? that has typically been the way people build wealth in the united states. >> thanks, mike. the housing market poses challenges going forward. we're a long -- the problems are long time in the making. one problem was the housing bubble that burst in 2006. prices came down considerably. saw a class families tremendous loss of wealth. that legacy has been it had when for the economy going forward. households are trying to pay down their debt. you mentioned household under water.

the economy has been recovering in spite of those problems. the recovery would be more robust if we did not have those problems. we overbuilt so much housing. residential construction has been very flat. in a typical recovery, residential construction is very strong. that is another drag on the economy. this came to a boil in the recession -- overboiled in the recession and we're digging a way past those. it is important that we take these steps that we can to keep the recovery going and the confidence comes back and that we get into more of it

virtuous cycle were more people are going back to work and feeling more comfortable and they are spending more and a stronger economy will help the housing market. but that's not enough. a tremendous amount of effort has gone into trying to assist the housing market in the sense of help homeowners modify their mortgages and refinance their mortgages, to take prudent steps so that they can take the advantage of the low interest rate that we now have and will help the recovery going forward. >> last question. >> and economists said international trade was a major reason for income and equality.

do you agree? >> we live in a global world, and the world is more integrated today that was back in the 1990's. we have had periods of strong growth when we were -- we saw all segments of society grow at that time. we are any more globalized economy today and we are competing with lower-paid workers in other countries, it is possible to thrive in this kind of environment. this will make this increase in globalization an advantage for the u.s. the president held an event yesterday on insourcing.

the company's kind of go through their cost, their enterprise cost or total cost went to think about transportation. they are beginning to make decisions to bring work back to the united states. that is a trend that we will see continue. we to look at ways where we can speed up that trend. another area i would highlight is the advantage in more production in the u.s. and hire skilled type work. we need to invest more in education of the future american workforce so that we can continue to thrive in this kind of environment. this is the second speech i've given as chairman of the council. i gave a speech in december about what kinds of things we

expect to continue in the united states. jeff diseuse told me something bezos sting -- jeff di told me something interesting. we have the best universities in the world. we have the most daring entrepreneurs. we have a system that brings all that together. we need to take in vanished of these advantages because the world is moving more in this direction. we do have the resources to match this moment and take advantage of the opportunities to produce better products and to take evanish of larger markets abroad -- to take advantage of larger markets abroad.

>> thank you. [applause] we are done. >> we have more live coverage on the way today of the c-span networks. tavis smiley will lead a forum

looking at poverty. among the speakers will be cornel west, suze orman, michael moore. that is live here on c-span beginning at 6:30 eastern today. we will have jody cantor on her new book, "the obamas" -- jody kantor. live coverage begins on 7:00 p.m. eastern on c-span2. to mark, the supreme court or zero arguments on the fcc -- moreau. the court will decide if the -- on broadcast television and radio. we will bring that to marmite at 8 eastern here on c-span -- tomorrow night.

supreme court decided lost not -- the case was in a church versus the eeoc against a former minister that tried to return to work. the supreme court heard the case last october. >> mr. laycock. >> the church is to not set the criteria for selecting the offices of government. that is a bedrock principle and these respondents would repudiate it.

they do not argue that she was not a minister. her job performance and the rules of ministry. >> as i understand the facts, she was never a decommissioned as a minister. she would not have been recommended by the officials, two other parishes to be a commissioned minister. it is odd to say any interference is with who is qualified to be minister.

>> she was removed from our ministry at hosanna-tabor. they don't have to involve any vendetta. there's not much of a recommendation there is proficient qualities and choose proficient. 5-3 is not very good. they were not pursuing formal charges against her. the problems they had were most severe at hosanna-tabor and another conversation. that was for them to decide. she was removed at hosanna- tabor, jews were the problem was -- which was where the problem was. >> most of the circuits have

recognized exceptions, but in one form or another created a pretext exception. the reason for that is the situation that troubles may how about a teacher who reports sexual abuse to the government and is fired because of that reporting? we know from the news that there was a church whose religious beliefs centering around sexually exploiting women and i believe regardless of whether it was a religious belief or not. dozens aside have a right --

once we say that is unacceptable, why shouldn't we protect the people who are doing with the law requires, i.e., reporting it. how to deal with that situation under your theory? under your theory, nothing survives. s. private claim >> the case your present is a difficult case. we think the proper role should be the government can do many things to penalize people who do not report, but a discharge claim by a minister and the courts should stay out of that. >> it does not take account of

the societal interest in encouraging the reporting. if we define the exception in the way you want, you take away the incentive for reporting and we do the opposite of what society needs. >> if you want to carve out an exception for cases like child abuse not an interest in protecting the minister, we think you can carve out that exception. >> how? >> first have to identify the government's interest in regulation. we're squarely within the heart of the exception. if the government's interest is quite different than that, you can access if it is -- but the

government is at its nadir when the claim is we want to protect these ministers as such and to tell the churches which criteria they should apply for selecting or moving ministers. >> the exception is not something new. it has been widely recognized by the courts of appeal going back 40 years. we can see how the recognition of this exception within certain contours' has worked out. have there been a great many cases involving the kinds of things that justice sotomayor is concerned about in which ministers have been fired for

reporting from violations and that sort of thing? >> i am not aware of any such case. a priest accused of abusing children who was fired sued to get his job back. they were able to get rid of him. a teacher with a long series of problems in her school called the police about an allegation of sexual abuse that did not happen at the school and called the police and have an interview a student without any communication with her principal. they tried it spin not but looked the case and to to quite different. those are the only cases that approach touching on -- >> a claim of retaliation so

that she cannot get a hearing. we can look at the various tests that are proposed here. this cannot even be litigated because there is a retaliation for asking for a hearing were these tests could be applied. >> she cannot get a hearing in the civil court. this court has said churches can create tribunals for the governance of their officers. >> that can be an argument you can make in the pretext here. >> an argument we make in whether the exception applies.

>> you are asking for an exemption. >> we're asking to apply the exemption. >> like a summary judgment. >> it was a judgment for summary judgment. >> it basically gave me summary judgment and not allow me to go to the agency and a proper test was not applied. >> the summary judgment was just an analogy. >> i am not sure i understand the question. she could have gone to the senate. >> if there's a substantial interest that the church has that can be litigated in the eeoc hearing. she was fired simply for asking for a hearing. >> i understand that.

once you start to litigate these cases -- >> it is none of the business of the government to decide the substantial interest of the church. >> that is one of my points. these decisions are committed by separation of church and state. once this process -- we can decide some issues in this case. that requires more and more distinctions that great entitlement. >> you refer to the ministerial exception. your position extends beyond ministers. how we decide who is covered or not?

>> she holds ecclesiastical office. she teaches the religion class. >> let's say she leads the class in grace before lunch. is a somebody who would be covered by the ministerial exception? >> the lower courts said they would not be covered and we are not challenging that role. >> i thought your position would be if she's a commissioned minister, as distinguished from a teacher who conducts grace or takes the class to chapel. i take it the chief is asking -- to characterize her as a minister. the extent of for religious duties to not matter if she is

commissioned as a minister. >> we think that makes her a minister. a jesuit -- the jets wou >> can we try whether it's a sham? >> is a sham different from a pretext? >> a sham is more extreme. you can decide if she is a minister. a person doing nothing -- we have a church who tries to say everyone who worked is a minister. >> you would allow the government court to probe behind

the churches assertion that this person is a minister -- you would allow that, right? you would not allow the government to decide if the fire was a pretext. >> that is right. the churches have a different idea about who is a minister. does that mean everybody who is a member of that church qualifies as a minister because that's part of the church boss belief? >> i think courts have some capacity to see with this employee is doing. she is teaching the faith -- >> a witness to our beliefs.

not every church is hierarchical in terms of different offices. >> i understand that. lay people in many churches are expected to be witnesses. lay people have to be witnesses. minister. make you a >> it seems to me this case. thisn't know about minister capacity in this church. many churches -- some churches did not have we think of as a full-time ministers at all. they are all ministers. that can be investigated.

>> how many religious functions you perform can be explored. we think she clearly is a minister. constitutes a minister is decided by the law. >> that is correct. >> we think there should be different to good faith understandings. we're not arguing for a rule that would enable an organization to declare that everyone is a minister when it is not true. decided a case 20 years ago and we're not defending that. >> what is the legal definition of "minister"?

that you have to lead the conversation in religious services? >> if you teach the doctrine of the faith, think you are a minister. >> so any religious teacher is a minister under your theory? there may be teachers who teach religious subjects and not mathematics but are not ordained in any way as ministers. are they ministers? >> if you teach the religious class, we think you ought to be within this. >> i thought it was agreed that there was no back dispute, that what she did at the school did not change from when she is a contract teacher and therefore

not a minister, and then she takes courses and is qualified to become a minister. what she's doing it at the school is the same thing. i thought that was the basis for the decision that we are reviewing, that there was no difference at all in what she did before she was commissioned and after she was commissioned. >> that is what the sixth circuit said. i did nothing that changes the nature of the functions being performed. these noncommissioned -- the lay and contract teachers were fill- ins when know whether a teacher was available. >> there was something in one of these briefs that said the

majority of the teachers in the lutheran schools -- i think it was -- >> i have the same impression. whether your commission or not commission does not mean you cannot teach a religious class. >> that is something that can be heard. >> it is not on a common among protestants -- it is not uncommon -- when they cannot find a minister to cover a class and hire a christian from another denomination, they say, the teacher and you are required to teach lutheran doctrine. >> if one of these protestant teachers that is not lutheran

led the cafeteria prayer, you are now saying the law must recognize that lay teacher as a minister and apply the ministerial exception? >> i did not say that. >> if she taught a religious class -- what is your definition of "minister"? so it is not a title. >> i think if you teach the religious class, you're a minister. if you hold and ecclesiastical office, that makes this easy. >> basically you would be here anyway even if she had not been ordained. >> that is correct. >> what is your reaction to it

less dramatic kind of holding? a particular individual does have some religious obligations in teaching and quite a lot. so the sword is on the edge. and whether ite applies or not you take the principal. a religious organization may require that she conform to the religious tenets of the organization. the district court looks at it. but there's no evidence that religious tenants had anything to do with her being dismissed. no one mentioned them. i read the excellent brief that explained the nature of taking civil suits.

no one said that to her. she found out on motion for summary judgment. she was dismissed. they could have had a defense but it does not apply. she is sort of like a minister but she loses. what are your objections to that? >> i don't think those are the facts here. it is clearly stated -- >> did anyone mention that to her? >> indeed. >> can you tell me where? >> page 55 on the joint appendix.

the teller there will recommend rescission offer call because of insubordination and because she threatened to sue us. >> this is a religious doctrine that you're supposed to go -- you're not supposed to go to court. they wanted to fire her because she threatened to sue. did someone explain to our the motivation is due to the religious tenet. >> you do not -- >> i understand that. the people involved were doing it for religious rather than several reasons. i'm wondering what the evidence is, that there were motivated by the religious doctrine, and that

they expressed that to her. mr. anything else i should look -- is there anything else i should look at? >> you would expect to find it in the handbook. the handbook doesn't tell her if you complained to the eeoc about discrimination that you'll be fired. >> the handbook is not in the record except for a short excerpt. >> is to anything it wanted to see other than page 55? >> i said, you cannot sue, you're a called teacher. that is also and the principles deposition. it was one of the first things

that he thought about. she was a lifelong lutheran. she had these apiology courses. theoesn't does illustrate problems that will necessarily occur if you get into a pretext analysis? what she told that she had violated the church's teaching about suing in a civil tribunal? that depends -- let's assume she was not told. suppose a catholic priest got married and the bishops said, i am removing you from the parish because of your conduct. there would not be much question about why that was done.

what was said about suing the church? is this a central tenet of lutheran is sism? >> that is part of the problem. how does this doctrine work? >> to dispel the notion that nothing is permitted in your reply brief, you say that there are many suits that could be brought that would not be inappropriate, and i think it is on page 20 of your reply brief. i didn't understand how those would work if the policy is your a minister if you have -- with the church.

we have our own dispute resolution. you do not go outside. when you say torts are rising, supposed a worker said, i think that there are unsafe working conditions and i'm going to complain to the occupational health and safety agency. would she get the same answer? this has to be solved in house. you don't go to an agency of the state. i did not follow with the tort does not follow under the same ban on keeping disputes in house. >> it may or may not. the rule is stated. a tort claim --

>> but i thought that she went outside the house. the go to the government -- you go to the government -- >> what we say is the legal doctrine -- the matter of law does not apply unless you get the job back. >> for any of these things, she could be fired because she complained outside the house. >> she could be cured the tort claim would proceed -- she could be. the tort claim could proceed.

>> then she would get damages and that would be all right. >> she would get damages for the tort. >> did i understand you before in response to justice sotomayor and justice scalia, that she worked a contract teacher, the fact that she teaches religion clauses would be enough for her to qualified for the ministerial exception? >> yes. >> i think that you answered issue were not a commissioned minister. she is teaching the faith. therefore she can be fired and it doesn't matter whether she is commissioned. the commission is irrelevant. it is her job duties the

account. for some purposes, a teacher who teaches religion and math and says i am a minister and i'm entitled to the allowance on my income tax return. that's something that a government agent would review. >> i don't think the threads have any problems with the irs. could reserve a few minutes for rebuttal. >> you may. >> mr. chief justice, freedom of religious communities to come together to share religious beliefs is a fundamental constitutional right.

it must accommodate the public welfare. congress does not infringe petitioners freedom on this case by making it illegal for a to fire a fourth grade teacher in retaliation for asserting her rights. >> is a great ministerial exception or not? >> it is understood as a first amendment doctrine the car is the adjudication of disputes between certain employees and their employers. >> nothing to do with respect to the ministers. is it distinct from the right of the association under the first amendment? >> we think it incorporates the right of association as well as the rights under the religion clauses. >> the people involved in this

case are part of a religious organization. >> the analysis is one that the court has elaborated in other court cases involving similar claims to autonomy. >> is that a no? a group of people who are interested in labor rights have expressive associations. is this any different than any other group of people who get together for an expressive right? >> we think, in great plays out maybe -- >> extraordinary. we're talking about the free exercise clause and about the establishment clause and you say they have no special obligations. >> the inquiry translates quite well to analyzing the claim that

petitioners made here. ofdon't think the job duties an employee are relevant -- >> the constitution prohibits the government from mucking around in the labor organization. you can drive such -- black and white and the text of the constitution or special protections for religion. >> i don't understand the first half of this argument. the condors at issue will depend on a balancing of interests -- the contours. a church as retaliation against a teacher who would report a

child abuse to the authorities. >> when one of the interest is religion and you are denying that. you say we balanced religion of the wheat balance labor organizations. there are certain relationships within a religious community that are fundamental. there will take a compelling governmental interest to justify interference. concerns with health or safety, for example. >> one of the central concerns of the establishment clause was preventing the government from choosing ministers. the government chose ministers or had a say in choosing

ministers. the clause was focus on eliminating the government's power. >> we do not dispute that. it is choosing a minister on behalf of the church. threatening to bring a legal contract -- >> you think that is a central tenet. you have a problem with what we do, go to -- to not go to court. that applies to civil actions of all kind. your view is it is not protected? >> it is not protected. if the court were to accept the

rule that the petitioner would ask it to adopt, we would never ask whether the church has a reason for firing -- their submission is that the hiring decisions with respect to parochial school teachers and two priests is off limits. we think that is a rule that is attentive to the public and private interest at stake. >> if they want to choose the priest, you could go to the catholic church -- you could not say that. >> we think the private and public interest are very different in the two scenarios. the government's interest is not sufficient to justify changing the way that the catholic church chooses its priest based on gender roles.

the interest in this case is quite different. the government has an overriding interest to make sure that individuals are not prevented from coming to the government -- >> are you not making a judgment about the relative importance of the catholic doctrine that only males can be ordained as priests? i did not see any distinction -- your position on those issues without coming to the conclusion that the catholic doctrine is older, stronger, and a title to more respect in the lutheran doctrine. >> the government has an interest in insuring and preserving the integrity of the law --

>> sorry. going to court is a more fundamental interest than a woman attending the job that she wants, which happens to be a catholic priest. that is the distinction you're making. you may be right. it is not obvious that one is more important than the other. >> foundational to the rule of law. >> you now sound as if you will drop a sharp line between retaliation climbs and other claims and i didn't get that from your brief. >> i think there is an important distinction to be made. if i could continue, i think --

>> are you willing to accept the ministerial exception? >> i don't think those are the only sets of the court that are important. if i could continue -- >> i think the question can be answered yes or no. >> that does not account for all the public and private interest at state. the interest extends beyond retaliation to the fact that this is not a church operating internally to promulgate and express religious beliefs internally. it has opened its doors to the public to provide services of educating children in compliance with the education laws. this court has recognized that a church-operated schools fit into

a different operation within the scope of government operations. >> with the plg classes -- with the ideology classes? extraordinary. who yupik to teach theology -- who you pick to teach theology -- >> the government's interest in this case -- it is one thing and one thing only, to tell the school and may not punish its employees for threading to report civil wrongs. that is an interest that we think overrides the burden on the religious as opposed to -- >> you are making a judgment on how important it religious belief is to a church.

this may be the same question just alito asked. you're saying you do not believe the lutheran church. >> absolutely not. we do not dispute. we assume the validity. >> the belief of the catholic church that priests should be male only -- you do defer to that. it is just as important to lutheran. >> the balance of will to the public and private interest is different in each case. >> do you believe a church has a

right that is grounded in the establishment clause to institutional autonomy with respect to its employees? >> we do not see that line in the religious clause as such. we see that as a question of freedom of association. >> i, too, find that amazing that the pre exercise clause has anything to say about it church's relationship with the employees. >> we think this is one of the cases in referring to free association claims -- it is true if the association claimed autonomy in this case is deeply rooted.

those things emerge in some ways in that respect -- those things emerge. >> that had nothing to do with who the church could employ. i do not see how that has any relevance to this. you say that there were different institutional values or government values involved with respect to a catholic priest then there is with respect to this lutheran minister. let's assume a catholic priest is removed from his duties because he married. he claims, that is not real reason. the real reason is because i threatens to sue the church. would you allow the government to go into the dismissal of the

catholic priest, to see whether it was praetexta tual. >> i think the answer is no. i would begin with voting on the burdens on association of the balancing test. i thing the core of the ministerial exception is that there's a difference between government regulations that interfere with the relationship between -- those who preach the words to the congregation. a more public relationship between a church and school teacher that provides services -- >> i think that says nothing different than what the chief justices suggested. >> i don't think that is a question of the importance of the their function to the religious association.

it is a question of the realm -- >> more import to go to court to sue about discrimination then for a woman to get a job. i cannot say that one way or another. so i am stuck on this. i did not see how you can avoid going into religion to some degree. it gets you right involved. if you're not going to do that, you look to see what are the religious tenants, and the kitchen right involved -- and that gets you right involved. we will try what congress suggested. we have a borderline case of ministry. the constitutional issue goes away and what congress said it

is ok. you have to prove that the church has to show that the african was disciplined or whatever because she did not conform to the religious tenant. that is what she has to show. they have to show it. if there's no evidence to that, that somebody knew about the religious tenet and it was something like that,. you would have to make a showing. i don't see how you would avoid an interference. otherwise you would get into who is a minister. formaking an argument following what congress said. if they can show -- nobody ever

fought this tenet. then she is going to win. what about that? >> i think that that is a perfectly appropriate way to, at this case. it skips over the initial inquiry, whether the application of the -- whether it results in an unwarranted interference. >> i agree with what we sometimes do and i thought that was the basic rule. >> i think the next question comes whether deciding the case will require the court to decide disputed matters or to second-guess -- >> if the plaintive proceed it that way, which should be entitled -- i assume she would

-- refreshes of religion about -- professors of the legend about this tenet. they might say it is not strong and it is faded and it is not enforced and you would have experts on the other side and you would have a court and a lay jury deciding how report this is to lutherans. how would you avoid that? i do not see that. >> it is irrelevant to the adjudication -- >> it is not irrelevant. every pretext case -- it was proffered by the employer is the real reason, is an important

reason for that employer and whether they think to the import and whether it is applied across the board. once you get into that, you'll get into questions of religious doctrine. let me give you an example of a real case. a nun wanted a tenured position teaching canon law at catholic university. she claims she was denied tenure because of her gender. the university argued she was denied tenure because of the quality of art scholarship. -- of her scholarship. you have a judge and jury decide whether the writings on canon law are making contributions? how can something like that be tried without getting into

religious issues? >> that may not have been the real reason of the employer. a judgment has to be entered for the employer. the was not the employers real reason -- that was not the employer's real reason. if it raised objections to women in the school and those schools were not filled by people of a particular gender consistent with religious beliefs, that is a case in which a judge can instruct a jury -- juries are often intricate their job is not determine whether a business judgment was correct but whether the employer was motivated by retaliation or discrimination.

>> thank you. could youllonellinger, assume for me that -- >> justice kagan. [laughter] >> assume that i missed something. [laughter] could you assume for me that there is a ministerial exception founded in the religion clauses? tell me who counts as a minister, and why this commission's minister does not count as a minister. >> i believe that there is an exemption granted in the religion clauses. it means that religious organizations will prevail in many cases in which a

comparable civil organization would not prevail. i don't think that it makes sense to approach it in a categorical way of asking -- >> i am just asking you to assume for a moment that there is a categorical exception, and tell me who you think counts as a minister and why the woman in this case does not. >> well, in our view, if that was the test, we would say that the court of appeals was correct in holding that she was not the minister, and the reason, the principal reason, is that she carried out such imported secular function in addition to her religious duties -- >> i am sorry to interrupt you, but that cannot be the test. the potency of a head of state carrying out sick of the functions, those are important. she is not a minister? >> chief justice roberts, i do not want to suggest it is not a very good approach to suggest to is a minister and was not a minister but that is what is wrong with the professor's categorical approach, because it is over- and under-includes of,

it's sweeps in cases where there is no religious reason offered -- >> your test -- why isn't it a perfectly reasonable test -- person may have a lot of a secular duties -- whether the person has substantial religious responsibilities? >> the reason is not a satisfactory test is it fails to take account of the important government interests -- for example, in this case, having everyone access to the court -- >> that is that the problem. the problem, it seems to me -- i don't know how substantial these interests are religiously. i don't know how substantial the religion itself considers what they do from a religious perspective. let's go back to justice alito's problem, and now on the minister real issue -- ministerial

issue, how central was it to the heart of the religion, what they are actually doing, and we replicate exactly what he said in respect to the problems of religious tenets, now in respect to the problems of the religious minister. maybe you can tell me we do not have to go into the one or the other, but i have had enough of these cases in the lower court to know that they are really hard, people believe really different things, and i see no way to avoid going into one or the other. therefore, i think rather than try this constitutional matter, let's go to the one congress suggested. >> if we go to congress, congress made it quite clear how this should be resolved, because congress expressly did not apply the religious exemptions of the ada to retaliation. >> no, i don't agree with that. in what it said is that a religious organization may require all applicants and employees to conform to religious tenets, it put that in this section defining

differences, defenses are part of the right, and it forbids retaliation against an individual with the exercise of any right granted. therefore, i don't believe that a person who failed to violate the substantive section could be held up normally -- i concede it is pretty easy to read that section, even though it is in a different sub-chapter come into the retaliations section. >> it is still the case that it is a constitutional matter. the state's interest in allowing citizens have access to its courts and agencies is paramount. in cases like child abuse, reporting of school safety problems and others, in this case -- >> but it is not paramount. would you take the firing -- take the firing of the catholic

priest, for example. does that get into the courts? >> no, it doesn't. that points out, justice scalia, that there are ample doctrines to protect it church autonomy. and the established man -- i did the establishment clause, there can be no reinstatement of someone appointed to and ecclesiastical position. >> he can be reinstated. >> i don't believe he can be reinstated -- >> he can sue for money, he can sue for -- >> i think in that case that is likely to fail, because you are going to run into issues of religious doctrine or evaluations of distinctly religious matters. those doctrines still stand. the problem with this categorical exception is it sweeps in cases like this one, they say "i was

dismissed from my employment," and she just wants the economic loss -- example go back to the of the canon law professor. i don't see how the approach that the solicitor general is recognizing, recommending, could eliminate the problems involved in the pretext. as i understood her answer, it was that you could not look into the question of whether the lawessor's canon scholarship was good canon law scholarship, but you could look into sex discrimination based on other evidence. a woman teaching canon law. our response to that might be that was not the real reason. if you look at the scholarship and see how miserable is and how inconsistent is with church doctrine, you can see that is the real reason. you just cannot get away from evaluating religious issues.

>> this is not a problem that is unique to ministerial employees, which is why it is both under- and over-inclusive. this is a circumstance in which an organization is going into the public arena providing a public service. in that situation, it ought to be governed by the same rules. justice scalia, use it is not employment division versus smith. but under that case, we know that the state could forbid the religious school from using peyote in ceremony, but under the petition, they could find the employee who reported that yousef peyote to civil the c- ton.or -- that use of peyote civil authorities and the employee would have no recourse. the employee could file without recourse with a non-compliance

to the attention of the eeoc. we believe that you can trust the congress on these hard areas where there needs to be additional accommodation. congress can make them, just as justice scalia suggested. the ministerial excedrin has a long history, but in almost every circuit in -- ministerial exception has a long history, but in almost every circuit did not apply to teachers. >> what congress assume that it applies to the ada? >> we had this debate with justice prior about whether you can say to congress specifically about retaliation cases. that after it emerged at a time when this court -- that dr. image at a time when this court has a position that religious

organizations cannot participate in getting public funding even when that they were providing remedial services to low-income students. we repeated that doctrine -- we repudiated at akron, with the court said that you are entitled to participate in providing public services on the same basis as other organizations. that means that you should comply in some instances with the same rules -- >> do lutheran and catholic parochial schools share public funds the same way public schools do? >> no, they don't, but they are entitled to -- >> what is this argument you're making? >> we are no longer of the era where we believe that no government or rules of employment and apply -- >> fair is fair, just like everybody else -- that is not

true. >> we recognize that the value of neutrality, will you have doctrines' that we recognize, you do not come under the establishment clause, introduce someone into an ecclesiastical office, and you do a balancing test to make sure that there is sufficient government of interest if you are going to undercut an organization's ability to convey its use. -- its views. >> thank you, mr. dellinger. >> two points briefly. this shows them as you'll be in if you try to decide these cases -- the mess you'll be in if you try to decide these cases. they cannot sue -- >> mr. laycock, i am not sure why the status of individual matters under your theory.

it seems to me that what you're saying is so long as a religious organization gives a religious reason of any kind, a genuine or not, for firing someone that is associated, whether a minister or not, that that invokes the exception. unlike hearing argument right? >> -- am i hearing your argument right? >> no. >> so why is there a difference -- >> it is categorically special because it is the separation of church and state. the level of sensitivity is not remotely the same. >> you would say with the janitor is that you can get into the pretext question? >> the janitor can litigate the pretext question, yes. >> you are limiting that test whether the person is a minister. define minister. >> a person who holds ecclesiastical office in the church or performs important religious jobs, including

teaching of the faith. >> there is an important point with respect to how the ministerial exception release date in order to make an argument for the minister ial exception, at you have to say that individual autonomy frois different from individual conscience. you want us to say that they cannot from institutional autonomy -- cannot trump institutional autonomy. why is that? >> smith is about whether people can act on the religious teachings after they are formulated. the selection of ministers is about the process by which the religious teachings will be formulated -- the establishment clause have something to do -- >> applies to individuals.

this court has relied on both -- there is a long line of cases all the way back to what and distinguishing this problem from the problem that culminates in smith. >> thank you, counsel. the case is submitted. >> the court heard the case last october. we will have more supreme court coverage coming up tomorrow. we will bring you this week's oral argument on the federal communications commission's tougher rules policing foul language and nudity on television and radio. the court will decide if the fcc has the constitutional right to enforce rules prohibiting indecent language and nudity on over the air broadcasts. tomorrow night at 8:00 eastern on c-span2 it on this morning's "washington journal," amy

schatz of "the wall street journal." host: explain how this case first came about. guest: broadcasters became upset that they were getting indecency fines from the fcc. in forces decency rules. broadcasters became concerned about the fines and sanctions the fcc and two cases specifically they were worried about. there were award shows where cher and nikole ritchie -- nicole ritchie profane words during awards shows. in this case, they said no, we

will not give you a pass and we will not give broadcasters in the future it asked if someone says the f-bomb on tv, we will fine you. fox did not agree with this and they took it to the supreme court. the other case involved fleeting nudity, an abc show called "nypd blue," a show will not for showing the door behind of its cast members, but -- well known for showing bare behinds of cast members, but in this show, a female was in the shower and it was her rear-end. host: so we wind up in the supreme court. take us inside the action. guest: i am not a supreme court reporter, and you don't have

cameras in the supreme court to see the justices. but it was interesting, because it was a case about indecency and nudity, and yet they were no indecent words used during the oral arguments because the justices basically said they did not want these words used. it was a very interesting case in which the justices were willing to broadcasters and the government on whether there is still a need -- grilling broadcasters and the government on whether there is still in need of for the fcc to be the cop. host: the supreme court heard this week a case on the fcc and indecency rules. we want to let you know that tomorrow night on this network, c-span at 8:00 p.m. eastern time, we will listen to the oral argument for the supreme court. what they do is release the audio on fridays, so tomorrow we will capture that audio inputs and pictures to it -- and put

some pictures to it of the justices, as we often do, and show it at 8:00 p.m. eastern time. take us deeper into the arguments made by each side of the court this week. guest: the broadcasters are asking the court to toss the indecency rules, they say they don't make sense anymore because most americans get their television from cable or satellite. 10% get this over the airwaves. they say it does not make sense to have these rules and more, because they don't apply to cable. they are asking the court to complete cost e -- completely toss enforcement rules. the government says it is crazy, because 10% of americans are watching these over the airways, and also you have radio, and there is value to have some sort of stop on the language used

over the ready, particularly if you are talking about what kids might be listening to. host: what where the justices saying? guest: it was across the board. the justices did not sound excited about tossing the entire regime. justice breyer asked if it was necessary to toss the entire thing out. justice kagan was asking about the first amendment part of this. they have found that it was perfectly fine for abc to run "saving private ryan" without bleeps, but wrong for pbs to run a documentary on blues musicians who use profanity. host: there was one recusal in the high court. guest: sonia sotomayor recused

herself because she was involved in this case at a lower court. host: john, democratic caller. caller: always an honor to be first on c-span, greatest free conversation in the world. i keep looking for my invoice in the mail and i will pay you guys when you send it. how does this affect the internet? personally, i have no problem with nudity, no problem with language. that is part of the free discourse of living in the nation. i don't think the supreme court has any business whatsoever editing language and nudity. if i want to show my body parts on the internet, or if something raises my ire enough to use what you consider profane word, that is part of the understanding that i need to impart to you.

between 6:00 at 10:00, a family hour on television, that is one that thing. but on the internet, facebook, anywhere else i want to go, i really don't feel like the supreme court has any business -- in fact, they are being unconstitutional in regulating this. host: let's hear from our guest. guest: actually, the fcc does not have authority to police the internet. there are rules on things like child pornography. you cannot do that on the internet. but there are no rules saying you cannot take a picture of your body parts and put them on youtube if you would like. that is not something the court is looking at. but there was a and document justice of the dow rose during the arguments, does this -- a document that justice alito rose during the arguments, does this make any sense? host: next call.

caller: i just wanted to make a comment that i am a southern christian, and i believe that people have the right to change the channel and they don't like what they hear or see. wendy's ratings came -- when these ratings came out when it's r, nudity,, pg-13, violence, language, all that place on television shows and things like that, people should be aware that that is the content of these shows. i have a 3-year-old granddaughter that stays with me a lot. when she is around about, and this type of programming comes on, and i think it is inappropriate, i enough's smarts -- i have enough smarts to turn the channel. i don't think it is inappropriate, but i cannot judge the world, and people have

the right to say what they are going to say, and i have the right to bleep them out or turn my head or just not pay attention to them, and change the channel if the grandfather is around. -- if my granddaughter is a rounded i don't think the supreme court has an issue with this, and i think they will uphold first to memorize to freedom of the press and freedom of speech -- first amendment rights to freedom of the press and freedom of speech. even as a christian, i think we have to understand that this is a part of the world that we may not like but it is a part of the world and we don't have to live in it, we have to live on it. host: amy schatz? guest: there are issues with this. some people think there is a difference between having scripted nudity or profanity profanity, where you are not really expecting it. broadcasters want to get some kind of clarity.

if a football player says something during an interview after a game, they would not fined for it. they want to know what is happening on this and they want some kind of expectation that there won't be these kinds of words when children are watching. of the super bowl from 2004. remember this, the justin timberlake-janet jackson episode. next call. caller: i think the issue that the supreme court is taking into consideration, of violence, violent programs, wwe, as well as the language and nudity issues as well. guest: fcc does not have

authority on violence. there is no restriction on how much of violent content you can put on the air. they only have restrictions on dirty words and pictures. host: why is that the case? guest: i'm not really sure. it has something to do with congress giving them the authority to police airwaves for peaindecent words and pictures, but not for violence. they never expanded their portfolio to cover violent entertainment. host: take us back to what is considered curse words. how do they look at concept of cursing? guest: no one can tell, because it has changed over the years. a lot of this comes from a 1978 supreme court case involving a radiobroadcast of a skit by george carlin, the seven dirty words you cannot say on tv, and the point of the skit is that he said these words over

and over part of the authority comes from the case on that skit, that broadcasters have fewer first amendment rights than newspapers or magazines, because they are using a public resource for free. because of that, they have more obligations and fewer, or limited, first amendment rights. the fcc enforcement came about because of that case, and as people have complained, the agency said this might be ok, that might be ok. part of the problem broadcasters are facing is that fcc uses a lot of context on this. in this context, it may be saying f-bomb is ok, in this context is not trade the janet jackson thing was really interesting, and that is what spurred a lot of these issues, because a lot of people were offended by what happened at the super bowl halftime show with janet jackson at the end of the

song, when it justin timberlake ripped away part of her costume and there were nudity bits. many people completed to the thecy -- complained to agency. caller: i have a couple of questions, but back on your first segment of whether the supreme court should be able to televise in there -- i know the biggest percentage says they should. i disagree with that wholeheartedly. even the one-time thing, that might set a precedent. just like in congress, with tv cameras, i think they should have them, but i watch a lot of that, and a lot of times the congress people, not congresswomen and congressmen, women ande congress men, instead of debating the

laws, they are playing to the cameras. they are like hollywood actors, especially the democrats, because they are hollywood actors. i don't think they should be allowed in the supreme court. you can hear it on the radio, whatever. ok, now, about this thing here and what should happen, i would like to garner the fact that 50 years ago you could not say the word "damn," "hell," any other of what you call profane words in a movie. something you go to the theater to see, you could not say that. before the mid-to-late-60's, and that is one of the rules that changed. what has transpired since then -- it has to be context, also, like a war scene.

it has been a nation of the rules have changed forever and forever, getting down and down. i now table -- i know cable come along, this and that, and most of the profanity comes with what you buy extra for cable. max, hbo, all that, all that awful programming they put out. i am not one of those religious zealots, but i am saying that that has had a detrimental effect, i do believe wholeheartedly, that it has had a detrimental effect on society as a whole, because kids have grown up in the cable generation, with all this stuff that didn't used to be, that congress and the nation found

upon. -- frowned upon. guest: the caller has an interesting point, that community standards have changed over the years. this is something that justice ginsburg brought up during oral arguments, when she said that children are not going to be shocked they would have been even 10 years ago -- shocked by these words they would have been even 10 years ago, because they hear them in the streets, movie theaters, ball games. some of this comes into the context of what does the fcc do as a community standards are changing? host: one viewer touches on sports. guest: they don't like it.

one of the reasons they brought this case was because fox, cbs, you are constantly getting crowd shots of people either holding up signs with a dirty word on them, or players are people in the audience saying these things. in the past, the fcc did not fine broadcasters for that kind of thing, but now they can. that is a big reason why the broadcasters took this to the court, because they felt they needed a safe haven. host: how does the fcc issue fines? what is its structure? guest: at the fcc even get fined $325,000 for each violation. show, h $325,000. sometimes they fine every

station, sometimes just the stations where people file complaints. you get to talking millions of dollars of fines. before that janet jackson case, the fcc was not finding people millions of dollars, but after the wardrobe malfunction, the fcc became beserious about fining. host: dolores on the democratic line, portland, oregon. caller: i appreciate so much for being able to speak on the show, and you guys do a wonderful job. the point that comes to my mind in regard to the fcc is that i hesitatingly agree that there should be rules in place for profanity and foul language. the reason i do so is not that i don't think the majority of the

people would have used that freedom, but it just takes a handful to just run it into the ground. usually, when there is room for abuse of any freedom that we might havbe that might be detrimental, someone will abuse it. i hesitatingly say that we need rules and regulations. as far as the supreme court, with some of the rules and precedents they have set in the very recent past and up to now, especially with regards to the corporation is a human being, and also, they, at a certain age when they get in the supreme court that it throws us back, so they also have a tendency to go

into the excess with things, with their biases and prejudices and bigotries. that is part of their ruling, too. the supreme court justice is needed to be elected and not appointed by president. thank you. guest: the caller raises an interesting issue, and this is an issue that divides people. there are not people who are in the middle, oh, i don't know if i like indecency or not. people think this is ok, or overblown, or they are really offended, or think it is not good to have on tv. this is the balance that the fcc is trying to deal with, because it is kind of subjective and a lot of ways and people have differing views on that. host: christy is in independent

caller. caller: i was calling because i feel that the cable companies have most of the program, so there is a lot of people that pay cable companies. just last week, it seems like a lot of shows on there are sexual-oriented, adult humor, which is fine, but the commercials they put on are not regulated in any way. they are bringing up these different sexual things that your child is watching, and they have this "taboo" show, a family that has two husbands, the girlfriend, weird st uff, and then you have "two and a half men."

why is this not being regulated? host: the caller speaks to commercials. guest: i think indecency rules actually to apply to them, too. you are not allowed to say an f- bomb in a tide commercial. the broader issue is that advertisers do not want to offend viewers. there are racier commercials for things like condoms, which you will probably see on cable channels. the fcc is not supposed to regulate for content. if you are talking about "two and a half men" or whatever, unless it is a dirty word or body part, it is not their job to come in, and they do not see as their job to come in and tell broadcasters what to air on their shows. cable companies and cable channels have a lot more leeway because they don't face regulation.

they can put on whatever they wanted. guest: there is actually not. the mpaa came out with the rating system because they did not want government to come in and regulate movies. that is one of the reasons why jack valenti came up with the ratings systems, so that you have r-ratings, whatever. broadcasters came up with something similar years later. i am not sure how many people look at those ratings, but the mpaa was successful in keeping government out of regulating movies. host: hi, mark. caller: thank you for taking my call.

this is a little bit off of the subject, but i wonder if your guest has information about low- power fm, a type of radio that serves smaller communities. we have not heard in years -- i guess a for is the applications for brand new --they froze applications for brand new low- power fm. guest: i have not covered fm in a little while. the fcc has tried to make it easier for low-power fm to move before, because congress passed a law to cover that. host: ben, good morning. caller: what is the difference in the tv and the the government saying that they want to teach the kids about the gay and sexual orientations and stuff like that in the classroom at 5

years old? host: any thoughts, amy schatz? guest: i am not sure i understood the question. the government does not have any role in saying what is on tv. they have some kind of roles on indecency and things like that. host: take us back to the court. they said that they did not use the curse words in court, but we understand it was quite colorful in there, nonetheless. guest: colorful for a supreme court case. they are normally dealing with it much drier subjects. the justices were highly involved. at one point they were talking about -- asked the government lawyer -- the lawyer was talking about how nbc got complaints about the olympics in greece, because there was a statute that showed a woman's nude breast

and behind. the lawyer was saying this is sort of crazy. their artistic merits to some of these things. even here in the courtroom, there is a statue of a woman and you can see her breast and behind, at which point several the justices eagerly looked over to the side to look at the statue, which they probably have not paid attention to in 10 or 15 years. host: how the numbers line up -- how do the numbers lineup? guest: they dealt with the case years ago but it was on administrative procedures and things like that. we have had new justices come in since then. we don't now how this is going to play out. host: oral argument gets released tomorrow, early afternoon. we will put it on for you at 8:00 p.m. eastern time from the supreme court earlier this week

right here on c-span. the constitutionality of fcc indecency rules. helen, democratic caller. caller: how are you? host: doing well. welcome to the program. caller: i am so glad this topic is on c-span. my comments regard the cialis commercial constantly replayed on the cable networks. every evening, i cannot focus, you know, because this commercial keeps coming on. i know the pharmaceutical companies are behind this, putting these commercials on. we talk about this commercial where people have to have an erection, i am appalled and sickened by this already paid when my granddaughter is in the house, i cannot believe my ears. i wonder if amy would

comment on a commercial it is being repeated and repeated. i find it in recent -- indecent. guest: unfortunately for you, i don't think the fcc would consider it in the scene because they're not saying any words are showing any pictures of what would be considered erectile dysfunction. but you see these on the nightly newscast on nbc, constantly play, and it offends quite a few doors because they do not want to think about it during the dinner hour. nashville, independent. caller: contest of community standards versus free-speech. i work with inner-city youth, and there is a lot of research that shows there is a real disconnect. for children, of course for

everybody, you learn the language by talking to other people. with the fcc in the battle for the first amendment, we have a lot of folks excited that they have the ability to swear at all of these things did what they don't realize is that the unintended consequence is that these children are learning that that is the base form of communication. there is research that shows that by 2020, the large percentage of american children, if they want to be taught english, will have to learn it in the same manner they learned spanish and italian. while there is this great first amendment rushed that we can say what we want and all those things, the impact, and not even the social impact, religious discussion, but just the impact that it has on our children, the research is done on inner-city homes that the average community, the kind of communication between a child and an adult, not "wash your

hands, do this, do that," natural communication, is less than five minutes a day. these kids are coming to our with ar kindergarten vocabulary -- the average usage is between 508 hundred words. they turn on the tv, and some of these shows are so stupid empathetic that their language used is even less. while we are in the inner city doing everything we can to print these kids at around, this is the kind of support that we get. this entire generation -- we want to do everything for children. if you want to help children, start talking like adults and start acting like them amendment right does not have to be the responsibility to teach these children the proper way. guest: those comments were

mirrored in the court, whether it is important for having broadcast tv to it be some sort peopleafe haven for would not want to hear this language. there are 800 channels you can turn to, so maybe there is some sense in having a few channels on the dial we will not hear that kind of language or see that kind of nudity. host: san antonio, republican. caller: thank you for taking my call. i am disappointed in our country it has gone completely downhill. sick, sick, sick. it hurts to see all the things on television. you cannot even sit down and watch a program with your kids without some the coming of all of a sudden, showing them how to have sex or -- you know, is

really, really sad that we don't have morals anymore. it is sad for our children. they think this is normal? i don't understand what happened to our country. host: we will let that come and stand and move on to west chester, pennsylvania. caller: how are you? host: fine. what would you like to say? caller: my comment is related to a previous caller. it seems that tv and movies have played a great part in changing society bostick acceptance of certain cars words -- society's acceptance of certain curse words. amy mentioned the mpaa had different, a great amount of focus on not allowing the supreme court to get into rating

the movies. how could people go abaoout having a greater say into the content on tv, music videos, and things like that? should the they contact their congressmen, or try to get more of an influence so that they can influence the supreme court, and whoever is responsible for making the rules for language and content on these shows and everything? guest: you know, there are a lot of organizations out there who actually do talk to the studios court tv networks about their concerns -- or tv networks about their concerns, whether it is movies or tv shows. common sense media -- they spend a lot of time looking into these movies, especially things that might not be appropriate for children, talking to the studios

and networks about what is appropriate. congress, i suppose, could pass a rule, but that is hard. probably the easiest thing to do it would be to get together with other people who are equally concerned to really lend your voice so that you can have impact. host: our guest writes for "the wall street journal." i

guest: 8 is going to be interesting to see, no matter what happens with the court, we will see something that happens later with indecency, because complaints have piled up at the agency as they wait for this court case to move its way through no matter which way this goes for broadcasters, the fcc will move forward with something. host: last couple of calls here. ed, south carolina, and bennett. ndent.depe caller: we have got into a place where there is a dumbing down of society. one of the biggest things that has happened is that we have taken our eye off the ball when it comes to our kids. one of the things that i know for sure is that i am a father,

and i have two small kids. i have a 4-year-old and 8-year- old. when you can turn your television on and see shows that are cartoon programs that appear like they are cartoon programs, and they have swearing words on them, and you walk into the room, and it is a cartoon show, and these are things that are being missed by a lot of parents. the sad part about it is that perring is leaving their kids in these rooms -- the parent is leaving the kids in these terms and letting their kids watch these tv shows that appear to be normal. you go back in, and you look and you see your kid watching this, thinking they are watching another show, they may have changed the channel or something. the bad part about it is the fcc needs to regulate it, because if it is not regulated,

one of the things i fear is going to happen is that when we first saw kids walking down the street with their pants off the behinds, we thought it was nothing. now you have a whole class of kids walking down the street with pants off hips, committing crimes, and they see as a fad. guest: obviously, cartoons are popular for children, but also popular for adults. broadcasters would argue that parents really need to take more of a step in actually watching with their kids, and it is the parents' responsibility to make sure that their kids are not seeing some of this content that they should not be seeing, that maybe they should be watching shows on sprout or other channels really geared towards children. one of the main arguments for broadcasters is there needs to

be more personal responsibility on the part of parents. host: went might bc a supreme court ruling on this? guest: we are expecting a ruling in july. host: amy schatz, thank you for your time this morning. >> we will bring you the oral argument tomorrow night at 8:00 eastern. the court will decide if the fcc has the right to enforce rules prohibiting indecent language and nudity in over-the- air broadcasts. coming up later today, talk-show host tavis smiley needs a forum on poverty and how it is changing the country. joining him, princeton professor cornel west, cnbc's suze orman, michael moore, barbara ehrenreich. on c-span2, jodi kantor and her

book "the obamas." she will be interviewed by "new york times" columnist david brooks. politico is reporting that the justice department has given its legal approval to president obama's senate recess appointments. it is against the objections of the senate republicans. white house officials argue that the time that this series of recessions but the senate held over the christmas break were not sufficient to block the president's power to make temporary appointees when the congress is in recess. he said the justice department has been consulted, but until the date declined to say whether the office of legal counsel high issue and a forma -- had issued a formal opinion but you can read more about this in politico.

the republican presidential candidates are in south carolina today. mitt romney has appearances in west palm beach, florida. jon huntsman has a fundraiser in new york later tonight. rick perry has four events. rick santorum is in sun city, south carolina, buford, and charleston. newt gingrich has two events lined up in columbia, south carolina, one of them are ready for the home builders' association of south carolina -- a rally for the home builders' association of south carolina. we will show that to you later today on the c-span networks. follow all the candidates at c- span.org/campaign2012. >> in this place, he will stand for all time, a monument to those who fought for this nation

and those who defended it. a black preacher, no official record tit -- rank or title, who somehow gave voice to our deepest dreams and most lasting ideas. >> sunday, president obama is joined by civil rights leaders and the king family for the dedication of the martin luther king jr. memorial on the national mall. saturday at 6:00, civil war scholars look at the direction of the war and northern and southern strengths and weaknesses at the end of 1861. after serving from 1960 to 1970 in the navy, now-senator john kerry became a vocal opponent of the war. this weekend on c-span3. booktv looks at the life and legacy of dr. martin luther king jr.

saturday at 6:00 p.m. eastern, "booknotes," with , and civil rights activist john .ewis gue hampton sides with the international manhunt for james earl ray. "new york times" correspondent jodi kantor on the first couple. booktv, every weekend on a c- span2. the international spy museum held an event yesterday looking back at 2011's intelligence gathering, successes and failures worldwide trade the featured guest speaker was david major, who was the head of the national security council from 1985 to 1987 under the reagan administration.

one note -- we warn you that there is a clip about saddam hussein's reign that is rather graphic. >> hours before this evening, david major, is a founding board member -- our speaker this evening, david major, is a founding board member of the international spy museum. he told me i cannot say he is an esteemed a board member, because that would make him sound old. he is not old. but he is a retired supervisory special agent and director of counterintelligence and security programs for the nse under reagan. he is founder of the center that provides counterintelligence, security studies, and trading. -- training. without further ado, i will turn it over to david major. you are in for a dazzling

evening, and i hope your heads are clear and are ready to absorb an intense and exciting amount of information. [applause] >> that is a heck of a start. first of all, thank you for coming out on a rainy night like today. it is difficult to drive in washington at any time, especially in weather like this. what we want to do is show you the reality of the world today. this is sponsored by the international spy museum, a database that keeps track of what is happening in the entire world in the world of espionage and terrorism. my own background -- i have been doing this blogger than most of you have been alive, but i look out and i see people with white hair and i feel comfortable when i see

demographics like that. i did notice the black and white picture, the fbi photograph when i joined the bureau. i spent my entire career doing counterintelligence and counterterrorism. i eventually worked in the national security council for ronald reagan as the director of counterintelligence programs. first time they ever put counterintelligence on the policy table. it was an interesting experience, because the first time i walked into the oval office to shake hands with ronald reagan, he said to me, "you know, i was an informant for the fbi." my answer was, "of course, we are proud of that fact," lying blatantly, because i did not know he had been an informant for the fbi. how come i spent my entire career doing this i do not know that part, that during the 1940's he was an informant for the bureau when he was president

of actors guild? it made me think about we need a center of excellence to look at this important discipline called counterintelligence, and that is how the cia centere -- the ci center came to be. we are going to look at the world. we are going to look at a variety of ways. we are going to look at what intelligence agencies and operatives around the world, l are like. i will probably run out of time before i run out of cases. it turns out that every year is a big year. we are going to look today -- it was not a good year for some intelligence chiefs around the world. we are going to try to define what is this thing of espionage we talk about, because every nation has a different definition of what espionage is paid at that we will turn to the paid at that we will turn to the united states and say who