only candidate in this race who has stood nose-to-nose with presidents of both parties and not flinched. i am the only candidate in this race -- [cheers and applause] -- i was against tax increases when democrats were doing it, and i was against it when republicans were doing it. i did not flinch. i was the only one that put together large national elections that changed the country. -thepast the first tax cut in 16 years, and the largest capital gains tax cut in history when unemployment rate dropped to 4.2%. with that we got the 1997 balanced budget act and it was balanced for four consecutive

years for the only time in your lifetime. [cheers and applause] with your help, if you will go back home and put this on facebook and tweet it and send out e-mails and call your friends. maybe in an old fashioned way actually see people, make sure they vote. with your help we will win the primary. that is a big piece of winning super tuesday. if we win super tuesday, we are back in the game. we will move back toward front- runner status with your help. thank you, and good luck, and god bless you. [cheers and applause] ♪

♪♪

>> next, peter orszag on the economic outlook. after that, former senator alan simpson. then the house debate on the payroll tax cut extension.

>> hello. i had of the lcv project. the purpose is to collect programming from outside washington d.c. staff each one of these with one person with a small video camera and a laptop editor so they are able to roll, produce, and added things from the road. we want to get out of washington, d.c. and collect programming for all of our networks. we are doing it and lcv city store. one will do historic programs and the other will do book-tv programs. the other one does community relations events. the last thing important to know is that all this not only goes on the air, but it gets archived on our web site, the c-span

video library. we are also doing extensive social media. he will see us on facebook. you will see four square which is location based and tell people where we are going. you will see us on twitter as well. it is a chance to get -- a chance to see as online and through social media as well. we want to get out of washington d.c., get into places we do not normally do programming, and get into places where we can do programming for all of the c- span networks. >> our next stop is a shreveport louisiana. >> president obama's former director peter orszag. he explains what is ahead in the coming year. from the executives club of chicago, this is 53 minutes.

[applause] >> good afternoon, the was a flattering introduction. it is a huge pleasure to be back in chicago that happens to be my favorite american city. [applause] a round of applause for that. it is linked to very much to the financial times. thank you very much for having me. it is my great honor to introduce the man that president barack obama called his propeller haead. -- head. it was a funny kind of complement. i am sure that you all agree that it is not an aspersion on his good looks. instead, it all makes sense when you realize that the propeller is inside his agile

and compendious brain. it spins around very fast indeed. this man matched equations with larry summers and the white house. he has the resume -- the fantastic hamilton project at the brookings institution. director of the congressional budget office. president obama's budget director, and the head of global banking data citigrou -- at citigroup. there was ambition and scope that he brought to all of those jobs. he is one of the nation's leading experts on the budget and one of the leading experts on the microeconomics of health care. if you want to know how to bend the cost curve on your rising health insurance costs, he is the man to talk to.

peter is a self-confessed geek. his public life is not something you can say about many geeks. many economists will bludgeon you with theories and numbers. when i read peter's columns they connect the dots to a pattern that i realize i should have known was there but i did not see it until he showed it to me. please welcome me in the -- help me in welcoming peter orszag. [applause] >> thank you, robin. thank you for joining us this afternoon, i am delighted to be here with you. i was like to talk to you about a few overarching things that are affecting the u.s. economy. i hope to use an empirical basis to connect some dots.

even when i tried to be empirical, the world does not always turn out as i expect. the most compelling affect of that is after having been confirmed in record time as the director of office and management and budget, assembling talked advisers to join me, i almost said the white house on fire since the war of 1812 -- on fire for the first time since the war of 1812. imagine this, it is a labyrinth in quite draftee. i was working the first weekend in office. it was cold and no way to adjust the thermostat. so i noticed there was, in the sellout barrette office, a fireplace in which there was a

fire screen at the next to it were some fire tools. and next to that, some logs. that suggested an operational fireplace. [laughter] being empirical, i decided to test the proposition. i made sure that the smoke would go up the chimney, the experiment worked perfectly. i moved the logs into the fireplace and i thought life was looking grand. the room is warming up nicely, five minutes and, i am getting work done. the fire alarm goes off. the secret service is clear in the hallways and somewhat was surprised someone was telling a four letter word and it did not come from rahm emanuel. [laughter] i tried to tell them that there was a fire burning in my fireplace. they say, don't worry about it please evacuate.

there is an electrical fire on the fifth floor. the to the coffee shop across the street. the secret service came to collect me because i was the culprit. about five years earlier unbeknownst to the first secret service agent, another part had capped the chimney as a security precaution. once it got to the top, and had nowhere to go except into a fifth floor conference room. my phone rings and i got a phone call from my mother that said, i am so proud of you, you are on television. [laughter] i say, they don't have the sound don, do they? hopefully what i am about to talk to you about doesn't have such dire consequences as evacuating an entire white house complex my first weekend

in office. we are at a very rare moment in the u.s. economic history. it is extraordinarily rare for an underlying tectonic plate shift to be affecting the economy at the same time that you have an overlay of a financial crisis. the only time that has happened in the last century was during the great depression when the economy was evolving from agriculture to manufacturing. that was a tectonic plate shift, and we had an overlay of financial crisis. it is an extraordinarily rare occurrence and we are living through it right now. the underlying tectonic plate shift can be expressed in lots of different ways. the way i like to look at it one of the first thing is taught in macroeconomics is that the share of national and come that a cruise -- income that accrues -- it looks like it is going down.

the reason is happening, we are living through a dramatic change in terms of a globalized labour market or increasingly globalized labour market. there are lots of estimates, but basically, effectively, the labor supply has doubled to quadrupled at the same time the global capital supply has not. the result of that shift is a downward trajectory and labour's share of national income. if you want to understand some of the frustration that people are clearly expressing, one way of looking at that is that if the labour share had been

constant instead of declining labor would be earning $500 billion-$750 billion a year greater. you have a lot of frustration but got a lot of policy prescription to address it. the manifestation again, one of them is the declining labor share. the other is stagnant, real wages for many american workers. this chart shows you what is happening to the worker at the fiftieth percentile, right in the middle of the wage distribution of the united states. the red line shows you that those working full time year round, their earnings have been flat. once you include the people that

don't have full-time work on the blue line, if anything there has been some decline. it has been shown in family income as well. the bottom line is for married couples right at the fiftieth percentile where there is only one spouse working. and not surprisingly, given earnings have been flat, our earnings distribution family income has been flat if there is only one worker. the reason that we have had some modest uplifted median income, the top line, is solely because it is increasingly likely that both spouses work. that is the underlying tectonics' plates shifted being driven not only by technological change that we can discuss in addition, but transportation costs and a globalized labor pool that is causing a significant shift.

i also mentioned that to date, it has affected those up to the seventy fifth percentile disproportionately. i strongly suspect that it is reaching out further into the income distribution. anything that can be digitized is subject to the same force. it opens up a series of other occupations and skill sets relative to the effects that were primarily felt in the past. what about the overlay of the surface waves we have been living through? one way of looking at that is to examine total private-sector borrowing. in the united states, it reached a 30% of gdp in 2007. in 2009, is m wasinus -- it was minus 15% of gdp. it would count as economic trauma under any definition of that term. the result has been, as with

most experiences with other countries have suggested a sluggish recovery. it is fundamentally different to a downturn caused by excess inventory, the central bank tries towring inflation out of the economy -- trying to wring inflation out of the economy. is hard slog. it takes time to deleverage. it has the housing sector feeding on to a weak economy and back on the housing sector. it takes time to work its way through. that is what has been happening in the united states. this is the share of the population that are working. you can see it falls off a cliff at the same time the

total private sector borrowing, the financial crisis, hit. the key thing, it has not come back. it has remained at a subdued level for the past two or three years. this is fundamentally different from other recent downturns. we're the red line there. the one that falls that doesn't go anywhere. the other recent downturns are of less severe in the collapse of employment to population ratio or the share of the population working, and they tend to come back more quickly. i would also note that every single formal macro econometric model, from the federal reserve, private sector forecasts, they all got this wrong. in the beginning of 2009 they were suggesting a rapid and more

v-shaped recovery. despite the fact that a financial crisis is different from other downturns. for example, for this year if you look at the forecast from the congressional budget office in january 2009, they were projecting an unemployment rate for 2012 of 6.8%. anyone willing to take that bet with me has to take the other side of if we are going to hit 6.8% or not this year. fundamentally, the nature of this l-shaped recovery was absent from every single formal model. the only people that got that right were basing their analysis on history or some other process, not a formal model. the lesson i take away from that, there are lots of people

that will walk around with very precise estimates of a fundamentally on certain things and you have to pay attention to that -- of fundamentally uncertain things, and you have to pay attention to that uncertainty. frankly, we can still do -- i will give you one example. there is a lot of debate over whether the initial 2009 stimulus should have been a lot bigger. i did not think that would be legislatively possible but let's say that congress would have voted for -- i wish i could tell you it would have been the case. but a $1.20 trillion stimulus. this is a very temporary problem, it would have all been delivered in 2009 and early 2010. 2010 would be stronger, but 2011 and 2012 would not have been that much different at all. what it misses is the time

dimension. it would be far better to tie things to the unemployment ratios of that they remain in force as long as the economy is weak. there is false precision at the end of this year, that support will no longer be necessary. where are we in this hard slog? we are part of the way through it but not all of the way through it. the only debate is if we are mostly or halfway through. this is one way of looking at that phenomenon. the share of vacant homes, share of homes offered for sale that are vacant, it goes up following the financial crisis. it is on its way down, but we are depending on the estimates

between 500,001 million more homes vacant and being offered for sale that under normal -- 500,000 and 1 million more homes vacant and being offered for sale than under normal conditions. so there is a tectonics' shift and surface waves to the financial crisis. with regard to the latter, it is a simpler set of solutions. my solution would be more support for the economy now coupled with a deficit reduction that is enacted mal to take effect over time. -- enacted now to take effect over time. with an elevated the unemployment rate, debt rises quickly. combine it with a deficit reduction that takes us back with delay. the underlying tectonic plate shift by contrast is much harder to respond to.

typically, what we argue is that what we need to do is more education and better more investment in infrastructure. those will help, but this force is so powerful that we should not hold up the false hope that we will online dollar that. -- have to unwind all of that. let's look at what is possible there. it is often not noticed that we have had, up until those that were born in about 1950 or so, wind at our back, from reaching educational attainment. the rate of increase has slowed

dramatically. those born 1950 and after educational attainment has risen, but not as fast as earlier generations. you can see earlier in this slide that breaks it down into different time periods between 1940 and 1960, it is mixing that a bit. the supply of college graduates is growing very rapidly. this is for the actual years sorry. today, there is much less rapid growth. there is still an increase in college enrollment, but it is rising at a slower rate than previously. that diminishes the underlying economic productivity growth. another effect of it is to raise the premium for college workers. since supply is growing less

rapidly and at the same time we have at the technological change in the underlying tectonics' played shift that raises the demand for college workers, you have a right not and how much college-educated workers are relative to those -- you have a run up on how much college-educated workers earn relative to those that are not. how do we get back on the path of rapid educational attainment? the answer will involve a lot more attention on lower and middle income and romans and completion of college. -- enrollment and completion of college. that is where the most improvement is possible in the lowest 20%-40% of the population. there is a very steep gradient to college enrollment by income.

some people argue that that is because low-income kids are not prepared for college, and there is a significant component to which college preparation does vary by family income. one of the things that we should be disturbed by, take a look at this chart. this shows you what your scores were like in a standardized test in eighth grade and what the subsequent college enrollment rate was by family income. what i want to draw attention to, the lowest performers from high-income families are enrolling in college at the same rate as the highest performers from low-income families. that is a problem. we need to make sure that the highest performers regardless of income, get the opportunity

to go to college. it will help us, it is fair, and it will get us to rapidly rising educational attainment overtime. all of these forces have led to what is widely described and widely known as a rise of income inequality in the united states where the sluggish growth in the middle has occured at the same time as very rapid growth for the top 10% and top 1% over time in the united states. and the tax code has offset part of that, but not much of it. the policy discussion often says, what are we going to do about this rather than other education. it will take time to move kids through college, community colleges, it plays out over a law period -- along period of time. with regard to the tax code, it

works quickly, but we should not expect it to be a full solution here or anywhere close to a full solution. most of the increase that has occurred has occurred with regard to pretax income. there is no plausible set of changes one can put into play where you can take this chart and offset any significant share of that over time. the tax code can help a bit, but it is not a full solution. we should not hold out false hope that this is going to change instantaneously. what are the implications of all this? there are some implications with regard to differential spending patterns. those of you in retail have undoubtedly noticed that high- end retail has been doing

better than mid-tier and a discount retail over the past couple of years. another implication has to do with income mobility. we like to pretend there is a huge amount of mobility from one generation to the next in the united states. it has been more of a myth that we would like to believe. what a way of looking at that is this chart. if you were born into the bottom 20% of income distribution in the united states, there is a 40% chance that as an adult you are still in the lowest percentage of the distribution and only a 6% chance that you are in the talks. similarly, there is a 40% chance you will remain there as an adult and only a 9% chance that you decline to the bottom 20% as an adult. is this related to, or is there any implication of changes of

the income inequality for income mobility? they're essentially different topics. as income inequality goes up, mobility goes down. there has been recent controversy over this. this is a chart from alan krueger of the council of economic and visors put up, suggesting exactly this. the question becomes, is this related to or is there any implication of changes in income inequality for income ability because those are conceptually different topics. there are some suggestedthere has been recentas income inequality rises, mobility declines. that may be another implication. i think perhaps the most challenging of all the implications has to do with or political economy, which is where i am going to end. there has been a fundamental change in the congress that has occurred at exactly the same gone up. i do not think these two are

unrelated. let me try to illustrate first congress. this chart shows you the red distribution is republicans in the house. the blue is democrats. the key thing i want you to focus on is in the late 1960's, there was a significant amount of overlap. the most liberal republicans and the most conservative democrats were voting together on a significant share of things. the model most of us have an hour had about health policy should be made reflects that. -- we have in our head about policy should be made it reflects that. the middle is disappearing. starting in the late 1960's towards the late 1980's, it is dwindling. we are effectively two different parties united by a single congress with almost no moderate.

especially since melissa is not there anymore. she was that one person sitting there in the middle. with far-reaching consequences. why is this happening? the punditry in what i call this corridor between new york in d.c. -- new york and d.c. suggest is proportionally that ideas gerrymandering. we have carved dick drea -- we a car to districts into spaghetti areas. this causes a split. most of the political science literature suggests that is a very small part of what has been happening. if you can see that. i thought i had a slight, but i do not. if you can examine what has happened in the house versus the senate. the senate has gone up as much as the house. we have not redistricted st. -- state lines. that raises questions.

the question that becomes, if it is not gerrymandering, it is it an inside development phenomena or does it reflect that? if it were gerrymandering, we would know how to fix it. if it is an inside the beltway phenomenon, we know how to fix it. if it is reflecting us much more difficult. there is a heated debate about whether it is inside the beltway or outside. the best evidence says that there are 17 states with senators from different parties in the beltway. they're representing the same constituents in different ways. members of congress and centers have the flexibility or the operational room to polarize them selves. similarly, when a district splits parties, that a member of congress represents the same

constituent in much different ways. if that is what were happening you would expect the majority of people, when asked if they are -- their member of congress is now too extreme, a larger share of them would say yes. that has not happened. if it were an insight development phenomenon, you would expect state legislatures to be polarizing less than the house of representatives. actually, two-thirds of the state legislatures have polarized more. all of which suggests to me a significant component of this is hot. we are becoming more polarized as a people. the reason for that, i believe is that we are increasingly both virtually and physically surrounding ourselves with like- minded people. one of the most compelling pieces of findings or evidence from social psychology is, if you put like-minded people together, the group becomes more extreme than any given

individual when they started. because the people want to prove that that -- that they are the true member of the tribe. you make yourself reenforcing comments. virtually, this is happening to us now because we can choose our own that news sources. we only used to say newspapers. watch the evening news. now, we can select our own reality. my favorite example of that -- i have a twitter account. i do not tweet, but i follow people. about two or three months ago, i noticed that one of the people i was following was saying a lot of things i did not like. mostly because he was criticizing me. [laughter] i responded by un-following him. i realized he did not exist. i should check to make sure he is still out there saying the same things. he no longer occupied my brain space. that point of view was no longer present in my thought blago.

similarly, physically, to a degree that i think it has been under appreciated, we are segregating ourselves by political parties. republicans are moving into their neighborhoods and democrats are doing the same. it is not only news and virtual reality, but our neighbors are increasingly of like-minded perspectives. let me show you a map that demonstrates that. this is a county -- this is county data. one way of measuring whether the county is polarized is to examine whether it goes hard one way or the other in an election. this is from the mid-'70s. the black or gray areas are landslides for the democratic or republican candidate respectively. there is nothing special about the carder race in 1976. -- jimmy carter race in 1976.

the key thing is, look at the best part of a country that is next. it is white. it does not landslide one way or the other. that is the '70s. that is today. applewhite is disappearing. there is retake the white is disappearing. a 30% of the population lives in more polarizing the states. you have to win presidential elections by appealing to those increasingly rare mixed counties. therefore, run to the middle if you will. i am no longer for that you can actually legislate there because the middle is gone. if that is right and it reflects us, we are going to face a central dilemma in our political economy. you run to the middle of the national election, you cannot legislate there. the only way you can at this

point in any meaningful way is by dominating the political system, winning the white house the house, and 60 votes in the senate, and legislating based on one part of that distribution. if you do so in those rare circumstances, you will generate some much backlash that that dominance will then disappear. we will have a significant time of gridlock and divided government. historically, that would not be that damaging because we still have enough overlap that you can legislate despite divided government. the key changes with the disappearance of moderates -- id is not clear to me that divided government lead to anything other than clear -- gridlock, which can be damaging. i will close with this thought. at about this time next year we are going to face a fiscal

trifecta that will make last summer look like child's play. that debt limit -- we will be bumping up against it once again. the tax cut from 2001 and 2003 will have expired or are scheduled to expire in full at the end of this year. at the same time, we have very large scheduled cuts in both the defense and non-defense spending, beyond what anyone believes as possible. they're all happening at the same time. that, historically, would have been a moment, because you have so many things that have to happen for big legislation to occur. instead of dealing with those rather unpleasant topics might as well put some lipstick on it and go bigger on something.

i suspect, however, that if we wind up with a divided government scenario that january, the prospects for that big legislation are much smaller than they should be because of the disappearance of moderates. again, thank you for having me. i am delighted to be here. melissa told me not to end on a bad note. [laughter] let me say three things i think can help alleviate some of these trends. the first is, the evidence is overwhelming that is causing the polarization. it is not being exposed to alternative points of view. i think we all, as citizens, 0 it to the country to go out of our way -- owe it to the country to expose ourselves to things we would not normally agree with. the second thing that i think corporate leaders, in particular, can do to try to provide some relief on the tectonic plate shift -- i do not want to hold out anything.

there are two things i think will help on underlying tectonic plate shifts. i mentioned education. when we mention that we typically talk about the institutions of higher education that are the crown jewels. the fact of the matter is, for most americans, far more important is the role of community colleges. i am particularly encouraged by what chicago is doing to try to unite local employers and local community colleges. would it not be great -- this is already happening. would it not be great if basically a local employer said, indeed of years, these are the skills we need. kids who are going to diminish the college's new if they did a good job -- going to community colleges knew that if they did a good job, they would get a job.

the firms get training and a skilled workforce. of the workers get -- the community college students get higher degrees of alliances that what they are studying is going to matter. that is what chicago is doing. i am going to watch carefully how that turns out because it is exactly the kind of thing that has to happen between the business community and local community colleges across the country. [applause] thank you. then the final thing has to do with pushing even harder for value in health care. the reason is, most american workers do not realize how much their take-home pay is being reduced by the health care costs that businesses face. if the trajectory on health care costs were improved, take-home pay could rise more as a result.

over the next five or 10 years we are on the cusp of a significant resolution possible in health care that involves information technology. it involves changing the way that providers are incentivize. i think united health and other insurers are doing a lot of useful things in moving towards a bundle payment and episodic payment and other methodologies that move away from just paying for each particular service. that whole effort will not succeed unless the people who are in charge of collecting health plans and providing health care for their workers, that is you, are forcefully behind it. i would urge you to read things and be exposed to things from a different point of view. continue to press what chicago

is doing on community colleges and put your weight behind the effort to get more value out of health care because that will ultimately prove beneficial, not only for you, but for our -- for the workers across america. thank you very much. [applause] >> thank you very much for a fascinating speech. we of arctic up some interesting questions. we have about 50 minutes to get through them. -- we already have some interesting questions. we have about 15 minutes to get through them. how much more will inequality wise, how much longer can the medium work? if you're a's business -- what can we do to face that world?

>> i think it depends on what you mean by inequality. i suspect these forces have widened the gap between the 90th percentile and the 50th percentile. on a going forward basis that is not going to continue. the 90th percentile is going to be affected by the forces of globalization and technological change. it has not been as prevalent over the past few decades. inequality will not continue rising there. it is in the 99.9%. the 90/50 ratio -- what is happening to the college graduate versus someone right in the middle of our earnings distribution. i am not sure it is going to

continue. a professor like to ask his students, who do they think will earn more in the next 20 years it qualified plumber or a run- of-the-mill engineer? he has been surprised to hear that often more than half of the students picked the plumber. to the extent that the engineer skills are easier to digitize, that may not be wrong. >> i guess you would interpret that -- make yachts. that is what will be in demand. >> thinks that are delivered in person or that involve non- tradable services involving different -- involve a different dynamic than the triple. -- the tradable. >> i am one of these people who is affected by digitization. >> there are now data mining software that can do a better job at analysis then what used to be a team of ph.d. economists 10 or 50 years ago.

it is not only journalists. [laughter] >> and other thing you mentioned is, the falling labor share of the economy. more is going to capital and less is going to labor. the upside is that profits must be strong. if that continues and there -- how can you get businesses to invest this huge amount of capital they have building up on their balance sheets? >> let us address that question. i think you are going to see investment -- there has been a fair amount of growth in investment at the short end. the stuff that depreciate rapidly. in the could finance software, that has been growing the past couple of years.

-- in equipment and software that has been growing the past couple of years. others have been hunkering down. the fact that ideas have been suggested me that -- the fact that it has happened that suggests that there is macroeconomics uncertainty. of the world is an uncertain place right now. that would make complete sense that if you are being driven by a concern about how the world is going to turn out, you make shorter-term investments because the cost of doing a longer-term one is larger. >> moving on to the budget issue. if the bush tax cuts on dividends and capital gains expired, the spending to sequester goes into effect.

what does that do to the economy? what is your guess of what the outcome will be towards the end of the year? >> all of that will be something like a 4% of gdp fiscal contraction occurring at a time when i doubt the economy will be back on its feet. that would not be good. some deal will have to be done. the challenge i have is, i do not see -- what i was mentioning about the congress. exactly how the deal happens i do not see. until the election and see how that turns out. no one wants an economy that is still not fully back on its feet to be hit with a fiscal contraction of 5% of gdp. that would be undesirable. >> they will have six weeks or something to do i do? is that possible?

>> ice -- i would be willing to bet that in order to get a deal done in a divided government scenario, you are going to need short-term extensions to purchase time for two months, as we have seen the congress to act when it cannot figure out how to resolve things before deadlines. or, we are going to have to go over the cusp and have all of this stuff expire in order to force people together, which would be -- anyway. this time next year, there will be a lot of trauma one where or another. >> plenty to write about. [laughter] speaking of journalists, in a recent book an article -- it pour -- it portrays your role as the anti-stimulus man.

what is your response? >> i am called an especially tragic figure. [laughter] there are a whole variety of traps that one can fall into in terms of missing important distinctions. i have long been the savior of a couple of stimulus approaches. i just mentioned earlier in which you provide more stimulus now, but couple it with a long- term deficit reduction. i think that is the right policy response and the legislative strategy. the debate describing these articles actually was between that couple stimulus, should we do more stimulus in and couple it with long-term deficit reduction or should we do naked stimulus? somehow, support for couples stimulus is being presented as anti-stimulus, which i do not understand.

that treatment is often a sense of missing that very important point. i think coupled stimulus is the only thing that has a chance of making progress with the congress. in addition, you have to remember, this is late 2009, we were coming up against another debt limit increase. the thought you would go out with a stimulus only bill and no long-term deficit reduction at all and then hope to raise the debt limit strike me as fanciful. not even planetary. >> moving on. i am going to keep throwing the statute. where do you invest your personal wealth? [laughter] >> i am in diversified, low-cost index funds, which are mostly global, but are we to my home country.

for no reason i think i can actually justify other then it feels safer. >> ok. [laughter] what are some ways to reduce health-care costs in the u.s.? >> there are basically four did approach to reducing health-care costs. you can reduce prices. reduce how much you pay doctors and hospitals. that is a very blunt and quickly effective tool, but it is only blunt. it is not a long-term solution. for example, if all you did was to ratchet down prices in medicare and did not address the underlying quantity of services provided, you would create access problems for medicare beneficiaries incentives to costs. if you cannot just bludgeon this through prices and have a long- term solution.

that leads as to where the great debate is. it is a fault debate. how do you get a quantity of service provided? one approach -- these are presented as mutually exclusive. one approach is the consumer approach. people often do not have that much skin in the game. if they had more cautionary, they would be better consumers of health care. that can help. at the evidence from experiments the united health has done suggests there is a benefit in terms of reducing costs. the problem is, it is not as big as you think. most of the consumer driven approach is to provide very -- third-party insurance. most health-care costs are in a high-cost cases. for example, you take medicare

and you rankin by costs, the top 25% account for 80% of the cost. that brings us to the other category, which could work in concert with more cost sharing. this is focusing on provider value. in those high-cost cases, why is it that some providers deliver health care in this way and others deliver it in that way? that involves changing the information flow in terms of health information technology and the technological incentives. there are a whole series of changes. one thing that has not been remarked upon is, over the past couple of years, there has been a huge deceleration in health- care costs, both in this -- both in the commercial space and medicare. it is not just a blip on the screen. it has been going on for a few years. ideas have been

disproportionately to medicare as it goes to the commercial space. -- it has been disproportionately medicare as it goes to the commercial space. i ask what has happened to medicare revenue. when i asked, i t was only up 2% year to date, which is dramatically lower than in the past. pulpsif you ask for the reason, the reason is the number of orientation -- the number of hospitalizations have been flat. the number of readmission people who are discharged -- 20% are readmitted within 30 days. that has gone way down because they have put in a screen. if you look like you were at high risk, they put a team of doctors on you and it is working. if you want to know what is wrong with the financial incentives in our health-care system, that program is working.

no one would voluntarily want to be readmitted to the hospital. the person who runs the hospital cannot afford to continue it because the doctors and nurses are expensive. more importantly, the hospital loses the revenue on it. there you go. >> see what i mean about him being good on health care? this is the last question, i am afraid. the eurozone debt crisis -- how is it affecting the u.s.? how concerned or do that it can do us harm? >> -- how concerned are you that it can do us harm? >> 25% of exports go to europe. exports are still a modest share of overall u.s. economic activity. when you put those two things together, the direct impact are not massive.

at second linkage is if financial contagion in the european banking system infected the u.s. financial system that looks increasingly less likely. the european central bank has stepped in forcefully to backstop the financial institutions, at least by providing three-year liquidity to them. also, because u.s. financial institutions have had enough time and are trying vigorously to insulate themselves as much as possible from that channel. your left with the third one which is the hardest to calibrate. it involves underlying uncertainty. there is hit to export. risk from in direct linkages through the financial system. more generally, we do not know exactly how this will turn out. i spent a lot of my time talking to ceos and you hear a lot of that. the macro uncertainty is causing

you to pull back a little bit. one of the principal components of that uncertainty involves the european debt crisis. >> thank you very much. please be kind to us on your blue papers. [laughter] [applause] >> thank you. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012] >> next, a conversation with former wyoming senator alan simpson. the niihau's debate on the payroll tax expansion. after that, president obama speaks at a boeing production facility in washington state. >> book tv is live saturday from the savannah book festival. coverage starts at 9:30 eastern on the last hours of the vietnam war, followed by 1045 on what it

is like on going to work. and the u.s. army's first blind active duty officer at noon. the changing israeli-palestinian conflict. the connection between paula liberty, and love. post-blackness at 4:00. and the rise and fall of the comanches. part of a three day presidents' day weekend on book tv. >> now, a conversation with former wyoming senator alan simpson. he was a guest on washington journal. this is 40 minutes. it is a great book. i didn't write it. it was done by a man i've known since i was a child.

guest: i never worried about the aarp or grover norquist or anybody. if you cannot just be who you are and do what you need to do you should not be in congress. the gentleman that just left, i have to admire him. there are a lot of people who will not let the principal come to a program like this. the cannot last for an hour. they run out of the brain. host: we have lots of big issues to talk about. let me ask you one aspect about your biography. before you became an upstanding citizen, you have some serious problems as a young man. i bet there are some folks who left that similar situations in their own families. you believe in the redemption is power of life.

talk about how you move from a troubled teenager could and young manhood into being the person you are today. guest: i think i was rebellious. i came from a great loving family and mother and father at that live to be 95 and 93 and a brother who is as close as can be. i did not like authority. i was involved in what they would call arson today. there was an old shack with booze bottles and we torched it. host: and it was on federal property. guest: i was on a federal probation for shooting mailboxes. then i did get sloshed on night

in laramie. a slight pickup. that was stupid. -- i slugged a cop. that was stupid. my mother would always cry and i knew that meant i did something importunes. when the old man cried and gave the old lament, "where have we failed?" it is stupid. it is dumb, savage, out-of-body stupidity. i wrote the amicus brief in the sentencing of a juvenile to life at the age or 4, 16. the second chance is important.

of course, the court said that was cruel and unusual punishment. i get letters from guys saying, thanks, i think i have a chance to get out. i am 40 now. i did it when i was 16. i killed a guy. when you're 50 and you're working in the pen or take ged or what, you have to have a chance. that is my view. host: one other story. this is a photograph with you and you two have the most interesting chance meeting as a young man and became good friends. guest: that was quite a story. norman mineta was transported to a pile of sagebrush in wyoming in the relocation senate.

-- called heart mountain relocation center. there were 10 of them. his family was sent there. the scoutmaster said we will go out to the jap camp -- that's what it was called. forget political correctness. that is what happened. that is what it was called. there were 11,000 people out there. they got barbwire all around it and guard towers and machine guns in the tower. we thought "what if they get out of their?" the town was only 3500 people. the scoutmaster said these are embarrassing. -- these are american people. host: how old was he? guest: 12. we were both 12. we read the same books. there were little things, very bizarre and crude. we did tie the knots and did

merit badges. there was a big believer was a little down from us one night. we dug a trench. the water went into his tent. i never quit laughing. he said i kept him up. he is one of the dearest of my friends. he is of the other faith. he's a democrat. i watched him. he went mayor of san jose. we came to congress together. we served on the board of regents of the smithsonian together. he and his wife and my wife, they have given up on us. we break our glasses and kiss each other on the head. he is a special guy. host: he was in an internment camp and went on to be a public servant. ultimately, faith in a system which did not have as much faith in him. guest: he didn't have any bitterness at all. he was like nelson mandela.

when he was thrown into robins island -- he came out and there was no bitterness. when i was teaching at harvard i had norm come up. he said, "what are you standing in the street protesting for?" he said, get in the game. get involved in politics. he's an inspiration for his people, the japanese americans. we both help to setup a learning and interpreting the center. $5.2 million. host: federal dollars? guest: no. it was raised. the gave all tent camps $35 million and split up to restore the camps to show the american people how that happened and how to avoid it happening again. host: this is the book. it is called "shooting from the lip." we will give you a flavor of two

of the many stories from a lifetime of public service and as early roots in wyoming. we'll turn to issues. guest: i do not get a nickel from the book. they say what are you doing tucking your book. it is a great book. it was the author who made the contract. all the royalties go to him. i ain't making a nickle. host: we been talking about the compromise that congress seems to have struck, the extension of unemployment benefits and to continue the payroll tax cuts. the republicans said the $100,000 did not have to be paid for and would contribute to the deficit. what do you think? guest: you cannot keep doing this. when will a congress is something with guts.

when are they going to quit giving the american people bs and mush? erskine bowles and i go around the country. audiences on the right or the left. give us an hour. we do not do bs. we take any question on any subject and we get a standing ovation. we are not looking for standing ovations. people are thirsting for somebody to tell that a truth. what i am waiting for is where is the aarp in this baby? all the shrieking ipod -- i have ever heard from them -- i had a hearing when i was in congress. i dragged them in. i said, what do you do with the money? that really po'ed them. they said all their existence of their money, and never touched

the precious life stream of social security. the precious life stream of social security is the payroll tax cuts. i have said, are there any pictures in here or just marketers? if you're out there today tell us what you think when you watch the sacred flow of money to the system, the payroll tax getting off balance from 6-2 to 4.2. eventually it will be put back. you have to borrow the money from the feds to do it. when you put it back, it will be called a tax increase and grover norquist will call it a tax increase and 95% of the republicans will be terrified. what can grover norquist do to you? he can defeat for reelection or

play a primary opponent against you. if that means more to the your country and patriotism, you should not be in congress. host: first call is from montana. this is gerald, a democrat. caller: good morning. what a unique opportunity. god bless you. you have in your in box a 2.5% solution. this has to do with the gse. congressional members and committees were distributed this week and the rest of the folks are being distributed next week because of a difference in mailing. can i get you to say read the one-page letter? host: he has a solution for how

to address this. you probably get a lot of these. guest: i do not hear well. i did not ascribe to those kinds of things. i'm a guy that's never signs a petition. host: do you read suggestions from people? guest: i never throw anything away. i read them all. we don't have a staff. we have some moment of truth projects and people that help and the research. if you'll send me that, i will read that. host: next call is from wyoming. this is ray, a republican. caller: hello. guest: ray is an old pal.

what are you up to? caller: not much. i was pleased to see that you are going to be on c-span this morning. i want to tell the listeners what a great guy you are. we crossed swords in one campaign and you were my honoring german in 2008. it wasn't a good year for republicans but we -fun- you were my honor chairman. guest: you have guts. you are a real conservative. people hear you and they enjoy you. it was just one of those years. you laid yourself on the line. i did put my foot in my mouth.

i think of the many times i got my foot in my mouth. i have a 16 shoe. host: he tell the story about the energy on the debate which led to a bill that has your name, simpson-missoli. we didn't have much material from 1986, but we have a clip from ron reagan's 1984 debate we talked about that. [video clip] >> we supported the bill strongly and the bill that came out of the senate. it is true our borders are out

of control. i supported this bill. i believe in the idea of amnesty for those who have put down roots even though they may have entered illegally. host: we're having this same debate in this country. guest: you talk about my diary. the reagan diary is a great book and a great thrill for me to see how many times i was mentioned in his diary, because i love that guy. all through the work, there were guys trying to kill it both parties. i would go right to ronald reagan. he would say, i'm still with you. the bill did not work like it should because the right and left said, wait a minute. they have a more secure

identifier and that is in national i.d. card. when you get that object rising in the eastern sky, you are in deep trouble. the lefties are calling it a national i.d. card. it did not work. but we did not duck the word "amnesty." i haven't seen a single article about a national i.d. you couldn't put the burden on the employer unless you have a more secure identifier. about 3 million people came out of the dark. host: what about right now? guest: you want to be part of a country that is going on the hunt for 12 million people? i came from a county in 1963 where they went after people

working in the beet fields and they called it operation wetback. you either give people a legal status, pick their pocket for some scratch, say they will be in temporary status and then be a temporary resident or permanent resident. you have to give them a pathway. host: this comment from a viewer on twitter. guest: fine. do whatever you do down there.

arizona is doing what they have to do in their mind. i do not have a single argument about that. the government has failed to do it. so if they want to do something about illegal immigration in their own way, be my guest. i would not challenge that at all. paul and another cup and wander off into the swap. host: pittsburg, brendan. caller: thank you for taking my call. guest: i didn't. she did. caller: i have two comments and a question. if that is okay. my first comment is if the democrats and republicans both take the oath of office to follow the document -- the constitution, then why is there such problems in the congress and the white house? my second comment, why is that everybody is talking about how

good of a job president obama is doing when it just not too long ago he signed away our rights? thank you and i would like to hear your answer. guest: the constitution means many things. the language is beautiful and real. those have talked about the strict construction of the constitution and those who talk about the fact that things have changed since those years. the supreme court has a different view of the constitution. every time there's a new supreme court there is a new view of the constitution. people say we need the constitutional amendment for a balanced budget. if they start that, there will open it up to other things.

people have been waiting to change its constitution. when you say it is a living document, you are in trouble. it is living documents. i believe that. if we cannot stop saturday mail delivery without breaking down the country -- it is in the constitution, mail. your second part about the president was what? host: mdaa -- the ability to snatch citizen without charges. guest: lincoln, the era of habeas corpus -- get rid of it. host: presidential politics. mitt romney and the federal money.

he sought aid for the olympics and massachusetts. he led an aggressive efforts to win federal aid for the struggling games. he requested millions for projects. he once boasted about his prowess for winning taxpayer money. what do you think about the gop candidates? guest: republicans have a curious history. i voted for eisenhower when i was 21 years old. the people who represented taft thought ike was a pink-hole. the eisenhower people thought

taft was a right-wing kook. i have been called everything. there isn't a single person in this campaign or sitting in the congress that did not pride themselves in bringing home the bacon. so what is new about that? "the washington post" would like to drill romney anyway. look at obama. look at santorum. look at paul. every one of them prided themselves. people say, how did we get here? you send people to congress to bring home the bacon. "go get me the highway. get me the stuff." he took a person with you that said, write it down. let me tell you, there ain't no more back to bring home. the pig is dead.

this country owes $6.2 trillion. people do not know what a trillion is. the big bang theory of the universe happens 13 billion, 600 million years ago. this is where we are. we're on a true victory of debt and interest which is like greece and ireland and portugal and we were sitting your winning for the markets and up goes inflation and interest. host: i want to circle back to the caller whose questions we did not understand. the president signed that into law.

this is a note from wikipedia. it does hearken to our question about norm mineta. this is what wikipedia says. "counterterrorism, which deals with detention of persons the government expects with involvement in terrorism." that was what was on his mind. guest: i apologize to the gentleman. i've lost track of the acronyms. i remember what gdp means. even though the wars in afghanistan and iraq are gone, there will keep people in guantanamo and the president said he did not want to do that.

but in that circumstance they feel if people are released they will go back and get back in their groups that were picked out of. they all have legal representation. there are many layers they go there on a pro bono basis to release them. those things happen and they will continue to happen if you see a guy go back and make more bombs and do some tricks. host: a republican is next. caller: i was so happy to hear mr. simpson say some things that i agree with that so many people did not anymore. people here more bad news than i hear good coming from the government. obama is doing is taking away our freedom. he also -- i heard last night over c-span that he has wanted to now take our nuclear weapons

away. 80% of them and put them in jeopardy should other countries try to attack us. i did not like anything he is doing. he is not an american and i'm very upset about it. if i could, i would have him impeached. host: do you believe the president is not an american? caller: no. host: you do not believe that? caller: he was born in indonesia. guest: i respectfully -- i was asked to be the co-chair of this national commission with erskine bowles. i've been accused of being a

republican toadie covering president obama's fanny. he is an american. i think these birthers are way off the wall. give it up. give it a rest. this woman sounds very concerned. very worked up. turn off your television and just rest without watching 24/7 junk. there is notions thing as a 24/7 riot. people get all steamed up. it is absurd. i did not think we of ever elected a president who came into office to destroy this country. we should have a lighter hand about that because it makes no

sense. host: we hear reference to the simpson-bowles commission work. the treasury secretary was on capitol yesterday and were several exchanges with reference to simpson-bowles. guest: we call it bowles- simpson. host: we went online and we saw both ways. guest: let me tell you what it is. it was voted on after a year of work nearly and five democrats and five republicans and one independent voted for this package. 60% of the 18 members. it stumbled in the weeds because

it was very specific. before they left, they said, do not tie our. grover norquist wonder did and he said ronald reagan is my hero. i said, i know ronald reagan and you know robbery in. -- and you are no ronald reagan. i said ronald reagan raised taxes 11 times it is eight years. grover said, i know, i did not like that. i don't care whether you liked it or not. we never have less revenue to run this country since the korean war. 15.2% of gdp.

you don't need to do a tax increase. cohen and dig into the pile of tax expenditures and jerk some of those babies out of there and go to any tax system. caller: you are one of my heroes. what do you consider to be full employment in the united states? guest: i cannot play the game. think of the young people coming into the workforce. host: what percentage would you be comfortable with? guest: you can do the figures all day long, bounce them back and forth. pick a figure during reagan's time, 4%. i was in congress 18 years and

never saw a statistic that was correct about growth or unemployment. it is like health care. 10,000 people a day or turning 65. if you say the present unemployment is this and forget how many hundreds of thousands come into the employee circle because of their age and their skill, so i guess you would say go back and look get a good year was it3% or 4% and grab it. caller: let's say 90% of the american people are employed. what the consumer would be the right thing for the social security tax to be. 14%?

half and half? 15%? if it went to 8%, would that help social security? guest: please read our report as to what we do with social security. we're not balancing the budget on the back of seniors. make a baby solvent for 75 years. raise the retirement age to 68. there are two ways -- reduced the benefits or increase the payroll tax. that was too simple. we give the aged, a kick up every year.

raise the cost of -- change cpi. but you can't let what is going to happen in 2 the year 2035, you will get a check for less and no one will challenge what i just said. that's why it is going debate and i think that is cruel. host: there is a statement about the president's budget. here is what they have to say officially. "it focuses on deficit reduction." "it would achieve less deficit reduction would briefly save at

a level that is already too high." what is the bottom line? guest: the president is using the figures. quit fiddling around with the baseline. the engine trick in washington -- we had a million bucks last year and a cut us. this is nuts. he had used the war savings -- overseas contingency operation -- we already did that. he cannot use that gimmick. it is a big gimmick. he cannot say that is a savings.

it was already figured in. we knew the war was coming down. he can just keep using the gimmicks. the war was in there. you have to go big or go home. this is where we are right now. there are plenty of americans who say, get at it. host: we have a question on twitter from jim. guest: a study who kept asking that on the commission -- dick durban. he is a gutsy guy. imagine how tough the was for him to support our proposal.

harry reid said, you cannot vote for this because it talks about in, reform and that's how we'll get power back. we will say to not ever mess with the entitlement of medicare. host: will be the catastrophe that sets off -- guest: the money guys would get tired. they care about money and they always take care of themselves. erskine bowles knows those people and he knows what they do. he says the market will call the shots. "we want more money for interest." at that point you will have a

rise in the interest rates. forget ben bernanke. he is trying his best and he get crucified. when the market's response and inflation kicks in, guess who gets hurt the worst? the little guy. that will be the chain -- the market will call the shots. host: don from oklahoma city. caller: what would it take for him and erskine bowles to decide to run for president and vice president? we don't care which one gets first. just to get someone with some common sense. guest: i tell you, i want to be king. erskine bowles is one of the great guys. host: not going to happen? guest: king.

a curmudgeon. host: this will be our last call from indiana. caller: good morning. i have a question on medicare. congress wants to cut medicare by 27%. i just kind of wonder about this. when the insurance companies follow suit? medical cost has gone so high. wouldn't they cut their payments to the medical field by 27% also? host: that is the doc-fix. guest: they will never get rid of that. the biggest driver of this debt is medicare.

we said to take $400 billion. it doesn't matter if the call obamacare or elvis presley-care. it doesn't matter. we take care of pre-existing conditions was somebody three years old, when a guy can get a heart operation and doesn't get a bill. who's kidding who? you have to do tort reform. you have to tell hospitals to keep one set of books instead of two. host: the house is about to come and. do think our country's best days are ahead of us? guest: i think they are ahead of us.

the american people are smarter than the politicians. they see the stupidity. if you spend -- will borrow money some more and through the year. who is getting who? host: that will be the last word. this is all available on c- span's video library, c- span.org. lots more in the book, "shooting from the lip -- the life of senator al simpson." thank you for being at our table this morning. guest: this is the place that america get some knowledge. host: you have a great weekend.

>> tomorrow kim dixon talks about tax proposals in the budget. lawrence yun discusses the house market. dennis cauchon talks about spending for employee compensation and infrastructure maintenance. "washington journal"at 7:00 a.m. eastern. >> next house debate on the payroll tax extension. president obama speaks at a bowling facility in washington state. newt gingrich at a campaign rally in georgia. >> i had a hunch one of them would be an addictive drug. i will ask each one a simple question. we will see what their response

is. >> i believe nicotine is not addictive it. >> cigarettes and nicotine cannot meet the classic definitions of addiction. >> we will take that as a know pierre >> i do not think our products are addictive. >> not addictive. >> they had a program where they wanted to replace cigarettes with a drug that was equally addictive but did not cause the heart problems. they had no way to test them. that was my job. my job was to find a molecule that a rat's brain would say i like it and the car would not have any cardiovascular problems. >> a former philip morris research scientist victor denoble and charles evans jr.

at 8:00 eastern on c-span. >> final vote in the house was 293-132. in the senate it was 60-36. here is the debate on the payroll tax cut measure. this is one hour 20 minutes. nized for such time as he may consume. mr. camp: i come to the floor today in strong support of this conference report. as a result of a lot of long hours, hard work, and determination on both sides of the aisle and both sides of the capitol, this agreement shows the american people that congress can govern and washington can work. first and foremost, this legislation prevents a tax increase on 160 million americans. as a conservative, i look at the agreement and see some very big wins. chief among them are the most significant reforms to the federal unemployment program since was created i the 1930's.

all designated to promote re-employment and paychecks instead of unemployment and benefit checks. while extending unemployment benefits through the end of the year, this agreement creat a national jobs search standard for the first time. covering benefits from beginning to end and requires evy unemployed american to look for a job if they receive unemployment benefits. the agreement allows states to spend unemployment funds on paying people to work instead of just sending them a check while they are out of work. it ensures taxpayer funds are properly spend by -- spent by permitting drug testing under commonsense rules that help people get ready for a job. it expands work sharing programs to help avoid layoffs in the first place, and it improves fiscal responsibility but not only recovering more overpayments which currently total a staggering $12 billion per year, but also by making sure that this program is fully paid for. the last item something i want to focus on for a moment.

all government spending in this agreement is fully paid for and not with one dime of higher taxes. all spending object un-- on unemployment and health care are fully paid for. this is a significant victory for those of us concerned about the national debt. and the culture of deficit spending that has gripped washing for far too long. for example the unemployment program has added nearly $200 billion to our nation's debt over the last four years. no more. we paid for it in december, we are paying for it today, and we set a clear precedent that the congress must live within its means, no more spending unless it's paid for, period. i understand this is a compromise. and not everyone likes everything in here. if i had my way, the bill passed by t house in december would be the law. that was the only bill that extended these programs through the end of the year. it was the only bill that was fully paid for. and it was the only bill that ensured seors and their doctors were protect interested dramatic cuts for at least two years. but we don't control washington.

democrats still control washington. they control the senate and they control the white house. utilizing a ocess that dat back to our founding fathers, house republicans have scored significant victories in this conference committee our founding fathers recognize that washington would not always be united. in their wisdom they knew even divided government must still govern. and that's what we are doing here today. governing and providing a solution to the very real problems americans are facing in their daily lives. urge my colleagues on both sides of the aisle to join me in supporting this legislation which pays for new spending with spending cuts, prevents working americs from getng hit with a tax increase next month, reforms our unemployment programs, and ensures seniors continue to have accs to their doctors. i reserve the balance of my time. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from michigan. mr. levin: i yield such time as i shall consume. the speaker pro tempore: the gentleman is recognized for such time he may consume. mr. levin: the basic fact is that this legislation is very

different from the december house republican bill, very different. and any efforts to mask that are false. and that house bill was the main bill before the conference coittee. the basic fact is the conference committee made major changes to the house bill that passed in december essentially on a partisan basis. and therefore this legislation is much better for the american people. the speaker said this about this bill, let's be honest, this is an economic relief package not a bill that's going to grow the economy and create jobs. that's not an honest statement. it's wrong. this is a bill that relates to

the economic growth of the united states of america. we are recovering. and this bill wilprovide a boost to continue that recovery. it continues the 2% payroll tax through the calendar year. and it is not offset as was true the house republican bill in december. it had massive harmful cuts that would have been counter cyclical and would have undermined further economic growth. so in that respect this is very very different. it's also very different in terms of unemployment insurance. let's be clear about that. the bill that the republicans passed through the house that was the main bill before the conference committee would have

slashed 40 weeks ofnemployment insurance for millions of americans in every state regardless of the unemployment rate in that state. and this bill essentially changes what was in the house bill. it extends unemployment insurance through the rest of the year up to, this is the maximum, up to 89 of 99 weeks through may, up to 79 weeks through august and up to 73 weeks through december, depending on the level of unemployment. let me just say our chairman has talked about job search and now a requirement of people be looking for work. that's already in the law of every state. that isn't a meaningful reform.

in terms of jo search, everybody not only registers but also, as i said, is requiring to look for work. and you know, i find it an insult to the unemployed of this country to say essentially what we're simply giving them a check instead of a paycheck. you know if you talk to the unemployed through no fault of their own, they are looking for work. they had a paycheck, in most cases, year after year after year. they work for their unemployment insurance, and to simply label this an effort to get people off of unemployment insurance, unemployment insurance is not a welfare program. people work for it and they

need that assistance as they look for work. the bill that passed through the house had a g.e.d. requirement. that's out. to say to people, you don't get a check if you're not in a g.e.d. pgram when there are 160000 people in this country who are on waiting lists for education, that's out of here because it deserved to be out of here. and in terms of the drug programs, the effort to test people for drugs it is so limited so it is really masking the reality to call this major reform. it freezes in terms of the reimbursement for physicians through december. and let me just close by saying a few words about the limits on this bill because there are limits. it would have been much better

to treat unemployment insurance as an emergency as we have for 20 years. this is the highest level of long-term unemployed on record in this country, which is another reason not to blame the unemployed for their unemployment as the hoe bill in december did and some of the rhetoric on this floor continues to do. we were not able to obtain this and i want to say this in terms of a precedent. in my judgment, it should not serve as a precedent. the precedent is 20 years treating it as an emergency, and let me also say it's deeply unfortunate that some on the other side insisted that federal workers carry a disproportionate share in the cost of this bill.

even if there were put forward bipartisan pay-fors that would have cost -- covered the cost of u.i. in a bill that was brought in a bipartisan basis, there would have been an impact on federal employees of $67 billion. this bill has a provision that will apply to pension programs $15 billion over 10 years, compared to the $67 billion at was in the bill that the house republicans passed. so let me just say in closing, this argument provides tax relief to working families, a framework is in place for the year for the unemployed woers, and a real commitment -- and i emphasize this -- but -- by us democrats to pursue

efforts to strengthen the economy and boost job growth so that those hardest hit by the recession can return to work as they desperately want to. and i just want to reiterate w wrong the speaker was when he said, let's be honest, this is an economic relief package, not a bill that's going to grow the economy and create jobs. the opposite is true. the provisions in this bill will help to continue economic growth. the payroll tax, most economists say that. unemployment insurance, people spend it, and that is not only good for their subcystens but good for the economy of our country. for all those rsons i urge support of this conference committee, and i reserve the balance of my time. the speaker pro tempore: the gentleman serves the balance of his time. the gentleman from maryland. mr. hoyer: madam speaker, i yield myse five minutes.

the speaker pro tempore: the gentleman is recognized for five minutes. mr. hoyer: thank you madam speaker. i've taken the unusual process of claiming time in opposition to this bill. i have done so so i could pce in context the bill we are considering. i do not rise to necessari defeat this bill. i'm going to vote against this bill. i for almost all of this bill. what we are funding this bill with was unnecessary unfair and ought to be rejected. i want to say at the outset that my friend mr. camp, and i had a very positive discsion. i believe that mr. camp and i could have reached an agreement which would have put me in support of this legislation. we didn't get there. we tried late in the game and we didn't get there. i regret that. i thinkr. camp tried.

i know that everybody on my side would have supported the agreement that mr. van hollen and i put forward. that agreement would, as the current agreement would say that the only individuals paying for this bill out of 315 million americans are the two million civilian workers who work for us, who work for all of us, who day after day, week after week, month after month make sure we give the services to the people of the united states, protect the united states, ensure that our food is safe, ensure that we have amphibious agents on the job, -- make sure we have f.b.i. agents on the job, these are all civilian employees. highly skilled. highly trained. highly educated and, yes

highly motivated. and every day they give outstandinservice to the people of the united states. we talk here and we pass laws here but none of those -- none of that talk and none of those laws makes a difference unless somebody implements what we say and thepolicies that we set. this congress is on the path to be the most anti-federal worker congress that i have served in. and i'm going to place that in context for you which is why i wanted t time. first of all, what is the context we find ourselves in? first of all we have a very struggling economy. the good news is the economy is coming back but not fast enough. we need to create more jobs, expand opportunities and make surehat the american dream is alive for all working

americans. working americans like our federal employees, working americans like the folks at g.m. who have done just very well, working americans who work in the hardware store, the grocery store, the gasoline station, hardworking americans. and we don't have enough jobs for them. as a result we have high unemployment, and i congratulate my friend mr. levin, for his leadership in maki sure that the unemployment provision in this bill is sufficient to try to reach those folks and make sure they don't fall off the ledge. we walked away from them in december. i'm glad we are not walking away from them today. now, we also have, as all of us know, a struggling economy and therefore we put into effect giving $1,000 more to each and

every worker. now, many of your leaders did not support this 2% reduction, and i understand that. i won't go into their names. some are in the chamber, but the factf the matter is it puts $1,000 of additional pockets into average working americans' pockets people paying fica. that is people making less than $6,000. that is an important thing to do for us to keep this economy growing. i'm for that. i was for it in december. i'm for it in february. i'm glad we are going to have consensus on that today. but what i am not for -- let me go on because in addition to that, we are playina silly little game. with the doctors and with medicare patients, and this silly little games pretends we are going to extend s.g.r. for

10 months. that's balo nmbs ey and everybody knows it -- baloney and everybody knows it. we are going to extend s.g.r. over and over and over again. should have done it permanently in this bill. we should have done it permanently in the congress which i was the majority leader. we should have done that. i yield myself two additional minutes. the speaker pro tempore: the gentleman is recognized for two minutes. mr. hoyer: so with respect to s.g.r. ladies and gentlemen, we are playing a game and the doctors all over this country and the medicare recipients all over this country know we're playing a game. we're giving them no certainty, no confidence that come this september, october november, we won't have another one of these silly little debates. now, we also in the context have a deep deficit and debt that confronts this nation that we have to deal with, and we had two commissions that said we had to deal with it. one was bowles-simpson. my friend, mr. becerra sat on

that my friend who sits in the chamber. the other was domenici and rivlin and we had others, including the gang of six in the united states senate, and alof them had a premise th needed to deal with the fiscal problem that confronts us and the other premise was all of us ne to contribute to that solution. all of us. now, what do we see that's being proposed in this congress , partially in this bill but only partially in this bill? we have either on the floor proposed on passed over the last two years -- listen to this ladies and gentlemen -- we are about to cut or propose to c $134 billion out of our federal employees over the next 10 years. nobody else in this bill, not a millionair not a billionaire, not a carried interest

beneficiary, not an oil company, nobody in this bill other than federal employees is asked to pay. i understand we have hospital cuts. by the way, we have $5 billion to that because we just increased by one year the cut that they know they got. the same for some other things. no individual other than a federal employee's asked to take a cut in this bill. now, you will say to me, no, it's future federal employees. two more minutes. the speaker pro tempore: the gentleman is recognized for two minutes. mr. hoyer: you say it's future federal employees so it doesn't matter. that's $15 billion of the $134 billion that's been proposed. they've already paid $60 billion $60 billion, and by the way, your side of the aisle is not going to give them that half percent the president asked for so that will be an additional $30 billion. so in three years, mr. and mrs.

america, madam speaker $90 billion in contribution to help bring this deficit down, federal employees are paying. and by the way, federal employees is a percentage of our population are down by a third over the last 20 years. it's not that the bureaucracy is growi. yes, our population is growing. we're trying to serve them. down by a third in numbers. now, i know something about federal employee pay. i represent about 60,000 federal employees. you say hoyer is up there defending his people. you'd be right. you'd be very right. . but most of the federal employees don't live in the washington metropolitan area. they live in your districts all over this country, serving your farmers. serving your drug stores. serving everything that you do.

do i think it's the private sector that makes this country great? absolutely. do i believe they need an energized high morale, highly educated federal work force as their partner? i do. and you will not have that ladies and gentlemen, if we keep along this path of every time we come to a bill that's a little bit of trouble the pay for is to reach in the federal employees' pockets. they pretty much are going to say i'm not with you any longer. i want to tell you in terms of recruiting and retaining you will not do it. 40% of the federal work force, ladies and gentlemen, can retire in the next five years. one more minute. the speaker pro tempore: the gentleman is recognized for an additional minute. mr. hoyer: ladies and gentlemen, you are going to be able to recruit those folks only if you have a competitive work force. let me give you a figure that

you might find interesting. there are 33,000 -- 33,300 employees at goldman sachs. average salary, ladies and gentlemen, $367,057. average calorie. -- salary. of 33,300 people. you won't be able to compete. you won't be able to get n.s.a. employees as opposed to semans or microsoft or some of those other corporation, many of which are in ms. eshoo's district, you won't be able to recruit them and retain them to have the st and brightest defending america and making america the strongest and greatest country on earth. yo want america to be an ceptional country, you better best have the best civil service on earth?

. as well as the best private sector. one more minute. ladies and gentlemen, i don't know whether most of you know this i saw the gentleman from florida who has been here for a couple months pontificate i didn't know anything outside the beltway. i was the sponsor of the federal employee pay comparability act. and george bush the first signed that october. we worked with his o.m.b. to get it. what does it say? federal employees cannot get a raise unless the private sector gets a raise. we are precluded from getting a raise unless the private sector gets a raise. what does it further say? that the private sector which is the economic cost index, by the way, in case you want to know exactly what the statistic is says we are going to take a half a point less. so what have you done? in this bill. unnecessarily. because you are going to freeze their salary for the third year in a row. and simpson-bowles said do it

for three. but they said everybody ought to share. we only get $1 trillion in revenues. $1 trillion in cuts. everybody. one more minute, but nobody but federal employees. nobody. is targeted in this bill other than federal employees. you can tell i'm angry about that because that's not fair. and that's not how you want to treat our employees, america's employees. america's public servants we call them. we ought to stop dissing them. we ought to stop demagoguing them. we ought to stop using bureaucrat as an epithet. america needs them. i'll have some other things to say in a few minutes, madam speaker.

but we ought not to walk away from our federal employees an more than we ought to walk away from those 160 million people who need this tax cut or walk away from those 2.4 million who need that unemployment insurance. or walk away as we have from the doctors who need certainty, long-term, not for 10 months, but long term. i reserve the balance of my time. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from michigan. mr. camp: thank you. before i yield i just would like to say to the gentleman that he did characterize our conversations correctly. it was very late. i do look forward to working with him in the future on these issues as we move forward. with that i would yield two minutes to the distinguished gentleman from oregon, a conferee mr. walden. the speaker pro tempore: the gentleman from ogon is recognized for two minutes. mr. walden: thank you, madam speaker. thank you, mr. camp. i want to thank my colleague from michigan for his extraordinary leadership in pulling the house and senate together as chairman of our conference. one of the key elements of this

piece of legislation is freeing up enormous swath of spectrum for use in the -- to grow jobs in technology and innovation, generate $15 billion to the treasury to help pay for some of the things that are being discussed today to extend the middle class tax cut, to provide unemployment for those who are seeking work, and in the process here there are estimates of building up the 4-g network which will take spectrum like that that will be made available here could generate between 300,000 and 700,000 american jobs and unleash technology and innovation in america. in addition to doing that, the republican house in concert with our colleagues across the aisle and chambers have come together to finally take care of you are public safety officials who on that terrible day in september of 2011 discovered their devices did not communicate well with each other, if at all.

so finally we have come together to create an interoperable public safety broadband network they can operate on wherever they are wherever disaster may strike, and they'll be able to communicate with each other. we have allocated money to build it out. i think we have put governance structure in place that while it's not exactly what i hoped would happen i think it can function. we will see. so we have built out a public safety network for our public safety officials. that will get under way. this bill will help generate 300,000 top00,000 american jobs, generate $15 billion private sector money coming into the government to help pay for some of this and protect our over-the-air broadcasters. our tv broadcasters who will be asking in a voluntary auction if they want to give up a spectrum are protected so the viewers out there and-k still see and watch their over-the-air public -- public and private broadcasters. madam speaker, this is good

legislation. and i hope you'll support it. the speaker pro tempore: gentleman from michigan. mr. levin: i now yield to a member of the conference committee, mr. waxman, and the ranking member on energy and commerce, two minutes. the speaker pro tempore: the gentleman from califora is recognized for two minutes. mr. waxman: madam speaker, with two minutes i'd like to ask unanimous consent that i be able to revise and extend my remarks and insert extraneous material. the speaker pro tempore: without objection. mr. waxman: with those remarks. i'll vote for this bill but i do so with reservations. we should have done better in meeting our responsibilities to the american people. there are important provisions in this legislation that will do a lot of good for families and our economy. we are extending the payroll tax reduction for millions of families, extending unemployment insurance, ensuring the doctors serving seniors will be paying for their services through the end of the year. an we are making spectrum available for new innovations in wireless communications. while these are provisions i

support, in the conference report there are significant missed opportunities and poor choices that affect federal workers and preventive health programs. nowhere is this lost opportunity more apparent an our failure to end the medicare physician payment formula known as the s.g.r., and set us on a path to a fair and reasonable physician reimbursemt system. having to settle for another temporary solution which leases at the end of the year even deeper in the hole in tes of a permanent solution it's a real failure and one that fails medicare beneficiaries and doctors alike, and i did not agree with the cuts in reimbursement for hospitals and nursing homes and unbelievably in prevention services in order to pay for the physician reimbursement levels at a reasonable amount. i am he deeply -- i'm deeply concerned about the federal employees' provision i think

that is very unfair. i do not have similar reservations about the spectrum provisions in the conference report. our bipartisan, bicameral negotiations resulted in legislation that will make new spectrum available for broadband services, will create a nationwide band ever spectrum that can be used for innovative, unlicensed applications, and will provide for the construction of an interoperable broadband network for first responders. taken as a hole, i -- whole, i believe we should support this package even with its serious shortcomings. yield back my time. the speaker pro tempore: the gentleman from maryland. who seeks recognition? the gentleman frommaryland. mr. hoyer: madam speaker, i now yield to mr. van hollen, the ranking member of the budget committee, distinguished

gentleman from maryland. the speaker pro tempore: the gentleman from maryland is recognized for 2 1/2 minutes. mr. van hollen: thank you, madam speaker. i thank my colleague, mr. hoyer. this bill accomplishes three very important objectives. it extends the payroll tax cut for 160 million americans. it extends unemployment insurance to millions of americans who are out of work through no fault of their own, and it supports the medicare program. so i am not here on the floor today urge my colleagues to vote against this bill. in fact i'm confident that it will pass. the bill's also significant for what it will not do. unlike the original republican house bill, which cut compensation for current federal employees by about $40 billion this bill does not cut compensation for any current federal employee. not one cent. let me repeat that. i'm pleased that senator cardin and i and other members of the

conference committee were successful in holding harmless our hardworking current federal employees. that being said, i'm going to vote no to send a message that enough is enough when it comes to usi the federal work force as a piggy bank to fund our various national initiatives. here's why. while no current employees are impacted by this bill, it does cut compensation for future employees hired starting in january, 2013. and that will, as mr. hoyer said, it will make it much more difficult for us to attracthe federal employees we need to do our national work together as part of our federal service. and indeed, one half, a full half of the 10-month extension for unemployment insurance that benefi the entire country $15 billion, is financed by cutting compensation for future federal employees.

that is a disproportionate share om the federal work force. the federal work force has already contributed over $88 billion to our deficit reduction for the denial of two colas and the proposed cola cut this year and the republan transportation bill would cut another $42 billion from federal employees to finance our national highways. that's a ridiculous approach. federal employees, as mr. hoyer said, are willing to do their fair share to help reduce our deficit, but stop singling them out and making -- singling them out and making them scapegoats. they had nothing to do with the meltdown on wall street and i'm sick and tired of hearing some members of congress badmouthing and belittling federal employees. if i could have an additional 30 seconds, please. mr. hoyer: 30 seconds. mr. van hollen: they are an easy political target for some, as mr. hoyer said. but it is irresponsible to denigrate their good work. these are the men and women who

care for our veterans and many of our wounded soldiers. these are the people in our intelligence community who helped track down osama bin laden. these are the folks at n.i. and elsewhere who help find treatments and cures that help prevent diseases that plague every american family. they are the folks who protect our borders. they are the folks that help run the medicare and social security system. they are the folks in the capitol hill police that protect is great center of democracy right here. so while this conference report does many good things, we need to send a message it's time to stop scapegoating federal employees and using them as the piggy bank for our naonal objectives. the speaker pro tempore: the gentleman's time has expired. the gentleman from michigan. mr. camp: i yield two minutes to a member of the conference committee, the gentlewoman from north carolina. the speaker pro tempore: the gentlewoman from north carolina is recognized for two >> thank you madam speaker. i ask unanimous consent to address the house for two minutes and revise and extend my remarks. the speaker pro tempore: without objection. mrs. ellmers: yesterday

afternoon i happyly signed the conference report that was -- happily signed the conference report that was very, very well put together, and i commend chairman camp for the hard work that he did and my fellow conferees. this joint conference committee came together. it was tasked to negotiate the payroll tax holiday extension, and this is a very important break through and shows that we can actually work together and compromise for the sake of the american people. i would like to thank again chairman camp and my fellow conferees once again for the honor and privilege to serve on this committee. our report does what is necessary to provide a responsible level of certainty to job creators and ensure that millions of hardworking americans will be protected. . in this obama economy, it's important that american taxpayers keep more of their money and use it to make en

meet. gas prices are projected to go up above $4 a gallon, madam speaker, by the summer. if this puts a ttle more money in individuals' pockets so they can pay for half a tank of gas or a quarter of a tank of gas then i say i'm all for it. furthermore, this deal strikes the most dramatic blow to obamacare yet, keeping a promise i made when i first came toashington. with this agreement we are cutting spending by more than $50 billion and using a portion of these savings to pay for the doc fix. what is the doc fix? the doc fix ensures millions of medicare patients our seniors to receive that medical care. it will prevent the 24.7% cut for physicians for medicare services. we must now return to the focus

of the most pressing issue facing our nation which is job creation and fixing this economy. the speaker pro tempore: jeaths. mrs. ellmers: may i have another 30 seconds. mr. camp: i yield another 30 seconds. the speaker pro tempore: the gentlelady is recognized for another 30 seconds. mrs. ellmers: the obama submitted another bloated budget that ignores the economic crisis we are living under the obama economy. it's time to roll up or sleeves and get to work and remove these barriers to prosperity and focus on the one thing that matters most, job creation, and continue to provide certainty to millions of americans who are looking to us to make concise decisions about their future and the future of their children. thank you, madam speaker. the speaker pro tempore: the gentlelady's te has expired. just as a reminder the time remaining is the gentleman from michigan, mr. camp has 11 3/4 minutes. mr. levin from michigan has 10

minutes remaining. and mr. hoyer of maryland has five. the gentleman from michigan. mr. levin: it's now my pleasure to yield one minute to our distinguished leader, ms. pelosi from the great state of califoia. the speaker pro tempore: the gentlewoman is recognized for one minute. ms. pelosi: i thank the gentleman for yielding and for hised a vocass on -- advocacy on behalf of the thriving middle class of america and make sure we would have this payroll tax cut as well as the extension of unemployment insurance. he fought so hard on that as well as on the making sure that our seniors are able to see their doctors under medicare. congratulations and thank you, mr. levin. i rise today madam speaker, in support of this legislation. of course, i identify with the concerns expressed by our distinguished whip, mr. hoyer, and mr. van hollen, regarding our public employees.

before i talk directly aut what is in the bill i do want to say that for our country to thrive and for us to do our very best, we must have a great relationship between the public and the private sector. the private sector is the driving engine of job creation in our country, but it cannot succeed unless we also have an effective and thriving public sector. it's about so many things that we lates to our public safety, -- relates to our public safety the courts, the implementation of laws passed in congress, it doesn't exist unless the public sector then implements. so this is a relationship that's existed from the beginning of time in our country and it's not a zero-some game. we can't say we are going to do this in the private sector at the expense of the public sector so i salute them for their persistent leadership and

recognizing the important role that the public sector pays. it was not necessary for us to go down the path that has been taken in this bill, and i'll geto that in a moment. i just want to say this represents a victory for the middle class in our country. i appreciate president obama taking this message to the american people, that it was verymportant for us to have a payroll tax cut for the middle class. it's important to those families because it puts $40 more into a paycheck to buy groceries, to buy gasoline, to make ends meet, to make ends meet, but it was additional being personal to families, it had a macroeconomic effect because these families will spend that money, inject demand in the economy and that is a job creator. any economist will tell you that this is very important to

continuing the economic recovery in our country, to have rejected it, as had been in the mix earlier, would have halted if not turned back our economic recovery. so let us recognize that one of -- we have three pillars that we insisted be in this package. we on the democratic side. one, that we would have a payroll tax cut for 160 million americans. what is unfortunate is we did not use our choice of a pay-for,hod it be paid for, the surcharge to covered the unemployment insurance. that would have been a preferable place to go. the undiplomat extension -- the extension of unemployment insurance. it could have also been used to pay for the s.g.r., the ability for seniors to see their doctors instead of taking money out of the prevention piece of the affordable care act.

prevention is -- makes america healthier, it saves money, it expands opportunity for people to get in the health care loop. that's unfortunate. and it could have been avoided as well as the unfortunate provision relating to our public employees. and even on that score mr. hoyer said mr. van hollen did there was a further compromise that could have been made that addressed me of the needs of the republicans to vote for this bill without doing more harm to the -- as mr. hoyer said, the recruitment, the retention of public employees the best public employees to help implement our laws and i want to salute all of them for their patriotic duty to our country, to keep us safe in every possible way, to allow commerce to proceed in a very

positive way. but now let's get back to why this is important, this victory for th middle class. this was a fight. why should it have been a fight? there's something out there in the public the ground troops the common sense coming up from the ground that this was an important thing to do, and the american people overwhelmingly supported it. there's a ground truth out there from the public, comm sense coming up from the ground that in order for us to do -- meet our needs and also reduce the deficit that we should have a surcharge on the wealthiest people in our country. people making over $1 million a year. not having $1 million. making over $1 million a year. that was not contained in this bill, but it will be part of the debate as we go forward. so let's take a moment to say

that we recognize here on this floor of the house the importance of a thriving middle clas to our democracy, to our democracy, and that this action taken today is an important step but we have much more work to do. democrats are committed to reigniting the american dream, to building ladders of opportunity for all who want to work hard, play by the rules, take responsibility, but we have work to do. in this thriving -- this -- reigniting the american dream, it's about recognizi the role of entrepreneurialism in our system small businesses, what they do to grow our economy and how we have a public-private relationship there to encourage small business and, again, all of this relates to a thriving middle class. so i urge my colleagues to be

ever vigilant about every opportunitwe can take to support the middle class. today is a good day in that regard. it's just one piece of it, though. we have much more work to do. and every bill that comes up, there are things you may not like in it and you say well, i'm not going to vote for it for that reason. on balance i come down in favor of supporting what the president asked us to do which we did do what the american people want us to do but i don't want to go forward without registering the concern that we could have done better in this. and one place we can start on our next legislation is to look at the surcharge for the wealthiest people in america instead of taking billions of dollars from preventive care so that we can offset the costs in here. none of it needed to be offset.

unemployment insurance has not traditionally been paid for. we dn't have to do it now. in fact, paying for it diminishes some of its stimulative effects. as economists will tell you, unemployment benefits are paid out, spent back in the treasury as will the payroll tax cut, it will stimulate the economy bynjecting demand and creating more jobs. s.g.r. we should have gone all the way with it. we should have done it permanently. we could have paid for it with our war savings or with the surcharge at the high end. the republicans said no. having said all of that, having said all of that, the fact that we are here today is an admission and -- that this is the right thing to do in terms of the payroll tax cut and unemployment compensation and our seniors a recognition that the american people are watching and they have little

appetite for us to be fighting over what they know is the right thi to do which is to take every action we can to grow our economy, focusing on the middle class, sll business sburel spirit -- entrepreneurial spirit and the rest reignite the american dream in an even bigger way. with that, madam speaker, i urge our colleagues to support the legislation, and i yield back the balance of my time. the speaker pro tempore: the gentleman from maryland. mr. hoyer: madam speaker, i yield 1 1/2 minutes to the gentleman from virginia, mr. connolly. the speaker pro tempore: the gentleman from virginia recognized for 1 1/2 minutes. mr. connolly: i thank my colleague. i support the doc fix in this bill. i support the payroll tax cut extension in this bill. i support the extension of unemployment insurance to so many of our fellow americans who suffered in the great recession. sadly, i cannot, however, bring myself to vote for this bill.

i represent the third largest number of federal employees i the united states, and they're asking a simple question -- what is the nexus, what is the relationship between their employment and these worthy subjects? and the answer is none. three mes this week the republican majority has attempted to get axed benefits and pay and compensation of the federal work force and often it's from misinformation. a bloated work force. we entered data in a hearing record the other day that shows the obama administration in absolute terms has 3,000 fewer federal workers than those that served during the administration of president h.w. bush and as a ratio to 1,000 population in america, it's the lowest since john kennedy was in the white house, in 50 years. they have already given $90

billion to debt reduction through pay freezes and future pay freezes. and to whack at this pensions affecting both current and future employees in the pending transportation legislation that i hope will die of its own weight. it is not fair to ask only one group of americans to make a sacrifice shared sacrifice should mean shared sacrifice. i yield back. the speaker pro tempore: the gentleman from michigan. mr. camp: i yield two minutes -- i yield two minuteso a member of the house conference committee, the gentlewoman from new york. the speaker pro tempore: the gentlewoman from new york is recognized for two minutes. >> this conference report that we bring to our colleagues for a vote today represents a remarkable good faith fert by the members of a committee who combined, who worked together, democrats and republicans, house and senate, to act responsibly for the american

people and in response to what the american people have asked us to do. ms. hayworth: as a physician and i practiced in the hudson valley in new york, the importance of extending reimbursement insurance for our seniors who rely on medicare, for the doctors who care for them, who have to keep their doors open, is a crucial issue. but not only did we provide that assurance through the end of this year, we also provided for some other crucial provisions for our rural hospitals, for our amlance services for a number of other aspectof care that rely on our action and on the responsible action that we take today. and, yes, we did pay for those extensions in a responsible way , as we must, in a time of looming scal crisis. .

we have a debt that extends to $50,000, roughly, per man, woman, and child in this country. it is unconscionable for us to fail to acknowledge that responsibility and for all of us to do our part in that way. we have, yes, asked our federal employees to help us because as the employer, the federal government has to take its responsible steps as well. and the hope that all of us have is that we will continue to work through this year. we will move from here with this consensus document and continue to work on the growth that our economy desperately needs and do so together, by controlling what the federal government does. and i thank you, madam speaker. i yield back. mr. levin: i now yield two mites to another conferee the gentleman from california, mr. becerra. the speaker pro tempore: the gentleman from california is recognized for two minutes.

mr. becerra: i thank the gentleman for yielding. in december this congress gave 20 conferees three tasks a cheeve by february 29. to extend the payroll tax cut for 160 million middle class americans. to ensure americans who lost their jobs through no fault of their own received their unemployment insurance benefits. and to guarantee ouseniors on medicare have access to the doctors of their choice and the care they need. we achieved this goal. but let's be clear. this agreement is by no means free of controversy. the gentleman from maryland, mr. hoyer, eloquently illustrated that. our republican colleagues succeeded in extrabblingting a pound of flesh from -- extracting a pound of flesh from middle class working americans who also serve ably in the federal government. what was the alternate that we faced -- alternative that we faced? a house republican bill passed in december that quadrupled the cuts to workers in their salaries and benefits, that

increased the cost of medicare for millions of seniors, that eliminated and restricted access to physical, speech, and occupational therapy in hospital settings for medicare patients, that eliminated the child tax credit for millions of modest income families. that eliminated unployment insurance benefits for nearly three million americans who have lost their jobs through no fault of their own. this agreement represents a rejection of the approach in the house republican bill of december. it is a compromise, free of the controversial and extraneous measures in that republican bill in december. but it is a bill of controversy. because we are asking american workers who work very hard who give their all and just happen to work for the federal government to pay the cost of helping other americans who are unemployed. we could have made this a good bill. we could have asked every american, especially those most able to contribute, to help out. we didn't in this bill and

that's why it's a compromise. it could have been much better. but we face the deadline by february 29 for 160 million american families. would have seen their taxes increase. we would have seen a situation where millions of americans would have lost their unemployment insurance and we needed to act as we did. i urge my colleagues to vote for this compromise measure. the speaker pro tempore: the gentleman from maryland. mr. hoyer: i yield a minute and a half to the distinguished ranking member of the government reform committee mr. elijah cummings from maryland. the speaker pro tempore: the gentleman from maryland is recognized for a minute and a half. mr. cummings: i'm very pleased we are extending the payroll tax cut through the end of the year which is essential to support our continued economic recovery. i'm also pleased we are providing unemployment benefits to ensure the millions of americans have access to benefits they so urgently need and that we are implementing the doc fix to ensure that seniors who are on medicare can continue to see the physicians of their

choice. that said, there are a number of provisions in this agreement that deeply disappoint me. for example, this agreement will reduce by 30 weeks the maximum number of weeks of unemployment insurance available to residents of states with average unemployment rates, while the unemployment picture is rtainly improving in january with the creation of 243,000 jobs, and a reduction in the unemployment rate of 8.3%, there's still 12.8 million people unemployed in ts nation and millions more who are part-time but want full-time work. for millions of fellow citizens unemployment benefits are truly a lifeline. i'm also deeply disappointed that the conference report requires new federal workers who contributed more to their pensions. our federal employees are not a piggy bank. we should not reach into their pockets any time we need to pay for something. federal workers are the backbone of our government. in return for their hard work and dedication, the majority has

been re-- has rewarded federal workers with an unprecedented amount of criticism, assault on their compensation, and benefits including proposals to extend their current two-year pay freeze and arbitrarily cut the number of federal employees. and now -- the speaker pro tempore: the gentleman's time has expired. mr. cummings: i'm goingo vote against this conference report. it's an important bill to get through, but i have to vote against it in the name of my employees. the speaker pro tempore: the gentleman from michigan. mr camp: i yield 2 1/2 minutes to the chairman of the energy and commerce committee and a member of the house sena-house conference the gentleman from michigan. the speaker pro tempore: the gentleman from michigan is recognized for 2 1/2 minutes. mr. upton: i thank the gentleman from the great state of michigan for yielding. i rise obviously in support of this conference report. it's not perfect but it is srnl the right thing to do now. -- certainly the right thing to do now. our economy is still struggling bigtime. families are struggling in my home state of michigan, we know better than anyone else the pain

of high unemployment and anemic economic growth. in extending the temporary payroll tax relief and unemployment benefits, it's not the way to fix the economy, but we need to do it now to offer a measure of relief to those in need. but our long-term goal is certainly much bigger. we got to fix the economy. we got to create jobs. we need toeturn america to a place where these temporary patches are not needed. in additioto the payroll tax and unemployment health extensions, this package includes the doc fix threw the end of the year to protect seen -- through the end of the year to protect seniors to prevent physician reimbursement rates from being slashed by nearly 30%. again it is but a temporary solution to a long-term problem. and as chairman of the energy and commerce committee i'm absolutely committed to working with my good friend, chairman camp, to develop a permanent solution to the medicare physician payment system. one that protects seniors and their doctors in the long-term

while also protecting taxpayers and making sure that medicare is efficient, effective and sustainable. these temporary solutions are a big part of the package, but madam speaker, it would be a terrible mistake to ignore another part of the package. one that will help support literally hundreds of thousands of jobs, one that will spur billions of llars of investment in our economy and affect the daily lives of nearly every american. i'm talking about spectrum reform. spectrum, it's the airwaves that carried wireless communications. spectrum is all around us and we sure do use it. with the exploon in smart phones tablets, mobile broadband devices, americans are using more spectrum than ever before. this bill helps our country make more efficient use of those airwaves. we are clearing large swaths of spectrum from innovative wireless investments and the upshot is that wireless companies will pay the taxpayers billions of dollars for the

right to build the next generation of wireless networks. it's a huge win for consumers and taxpayers. this package is the culmination of years of effort, bipartisan effort, numerous hearings, extensive stakeholder input, cooperations on both sides of the aisle, and i want to recognize my good friend and chairman of the communications and telecommunication -- the speaker pro tempore: the gentleman is recognized -- >> both greg walled ron and -- walden and anna eshoo to push this bill through the finish line. no qualified bidder can be excluded from the auction. were it not giving away airwaves that the taxpayers paid to clear. these are good solid reforms withclear congressional intent and i appreciate the hard work to get an agreement and advance this wireless future. i think all my colleagues on the conference committee. we worked together. we got it done, and the taxpayers are going to be better off. i yield back the balance of my time. the speaker pro tempore: th gentleman's time has expired. the gentleman from michigan. mr. levin: i now yield two minutes to another hardworking

member of the conference committee, ms. schwartz from the state of pennsylvania. the speaker pro tempore: the gentlelady from pennsylvania is recognized for two minutes. ms. schwartz: thank you. this conference committee was charged with resolving differences between the house and senate so we could extend middle class tax cuts, protect seniors, access to their doctors, and extend unemployment benefits for americans looking for work. as a member of the conference committee i'm pleased we found a compromise to meet these goals and we are able to provide stability for millions of americans. action today means 160 million american taxpayers will be able to keep more of their hard-earned dollars. these are middle class families struggling to pay their mortgages, food built, childcare cost and college tuition. this tax cut will better enable them to meet their obligations and contribute to growing the economy. it means that 13 million of our hardest working americans will receive unemployment benits and be tter able to pride for eir families.

there are encouraging measures of economic growth in our country, but recovery is still fragile. we had 23 consecutive months of private sector job growth, unemployment numbers are down. yet millions of americans are still looking forork. action today better ensus that losing a job will not mean economic disaster for families who have worked hard and played by the rules. action today will mean we will keep our promise to 47 million seniors by preventing a drastic 27% cut to physicians who care for medicare beneficiaries. th is a win for american seniors. but it does not relieve us of our responsibility to permanently repeal the s.g.r. and replace it with a new payment system. for over a decade this failed policy has created uncertainty and instability for patients, for health care providers, and the federal budget. throughout this process i advocated for both permanent fiscally responsible repeal of the failed medicare policy, and a path forward to new paymen

models to improve quality while reducing costs. despite bipartisan support for this approach, long-term agreement could not be preached. i will continue to work with my colleagues on both sides of the aisle to end this perennial threat to the prise of medicare once and for all. i urge support for american families and seniors and millions of americans still searching for a job. i urge support for this conference report. the speaker pro mpore: the gentleman from maryland. mr. hoyer: i yield one minute to the gentleman from virginia, m moran. the speaker pro tempore: the gentleman from virginia is recognized for one minute. mr. moran: thank you madam speaker. i thank my good friend from maryland. i appreciate the rk of the conferees. but i oppose this conference agreement not out of concern for the welfare of the tens of thousands of federal employees that i represent, but out of concern for the welfare of the great nation we serve. we are blessed with the least

corrupt, most effective least discriminatory, most responsive federal work force in the world. and yet how do we repay them? we are requiring them to increase their pension contributions by 400% with n increase in benefits. so we are sending them a signal. so i will really appreciate what you are doing. you e expendable. it's a signal that will not be lost on the recruits that we desperately need in the few -- future. let alone the hundreds of thousands of federal employees who could easily be making much moren the private sector. the whole country's going to pay a price for the signal that this bill sends. and that's why i think we suld defeat it. thank you, mr. chairman. the speaker pro tempore: the gentleman from michigan. mr. camp: i reserve. the speaker pro tempore: the gentleman reserves his time. the gentleman from michigan. mr. levin: i now yield one minute to the distinguished

representative from california, ms. eshoo. the speaker pro tempore: the gentlelady is recognized for one minute. ms. eshoo: i thank the gentleman. madam speaker, i rise today as the ranking member of the communications and technology subcommittee. on this legislation because i think it's so important. it will define our nation's ability to lead the world in wireless broadband deployment. it also will define how we finally provide our first responders with a nationwide interoperable broadband network. this legislation will usher in more competition, enhance innovation bolster the american economy, and very, very importantly create jobs. good jobs. i thank my colleagues on both sides of the aisle and the other chamber for coming together to develop legislation that

promotes the public intert and ensures the return on investment for the taxpayer by supporting unlicensed spectrum, a nationwide interoperable public safety broadband network and provisions to ensure that our nation's 9-1-1 call centers will have the modern tools needed to improve the quality and the speed of emergency response. incentive auctions will ensure we have the world's leading wireless infrastructure and the future for unlicensed innovation in the tv band is bright. the public safety community is going to have the tools -- 30 seconds. 15 seconds. mr. levin: 15 seconds. ms. eshoo: the pubc safety community will have the tools to finally build out a critical nationwide interoperable broadband network and the inclusion of provisions to promote and fund next generation 9-1-1 bye will enable the delivery of voice text, photos,

videos and other data to 9-1-1 call centers. i thank my colleagues and i urge them to support the legislation. . the speaker pro tempore: the gentleman from maryland. mr. levin: i reserve -- mr. hoyer: i reserve. the speaker pro tempore: the gentleman reserves. the gentleman from michigan. mr. he vip: i yield one minute@distinguished gentlelady ms. edwards. the speaker pro tempore: the gentlelady is recognized. ms. edwards: i would like to enter into the record letters from public employees who are wondering why they had to sacrifice $60 billion of reductions over the last decade when they didn't create the deficit, yet they're asked to pay for it. the speaker pro tempore: you want to enter into the record, witht objection.

ms. edwards: and i rise in opposition to the conference report. on behalf of federal workers, and i wonder where it is that we'll be able to find the next robert ball who lived in my district, who was the architect of social security. i wonder where -- whether we'll beble to find the national security and intelligence specialist who live in my district in collington for the next generation. i wonder mr. speaker, whether we'll find the next negotiator of a stark treaty in my district. we won't find them because we asked federal workers to sacrifice for a deficit they didn't create. with that, i yield back the plans of my time and say let's vote against this legislation, vote against the conference report, support federal workers and the talented work force we have for future generations. the speaker pro tempore: the gentlelady yields back her time. the gentleman from michigan. mr. camp: i yield two minutes

to the distinguished gentleman from oregon. the speaker pro tempore: the gentleman is recognized for two minutes. mr. walden: once again as we're reading about how troubled the econy is this is the weakest recovery since the great depression. it is certainly the kind of economy well want to improve. the underlying piece of this legislation frees up spectrum that will generate hundreds of thousands of jobs as 4g is built out. they need spectrum to build out 4g. this provides spectrum. this is a voluntary incentive auction. nobody is being force off the air waiv -- airwaves, but they'll have the opportunity to go off the airwaves and make the sprecktrum available. peopleay, what is that? that's what powers the device, your ipad, an detroit

whatever and it will generate $15 billion from the private sector into the government by auctioning off this spectrum to help pay for the middle class tax cut and pay for unemployment extensio and the doc fix. we would have, on our side of the aisle preferred a two-year fix for our physicians taking care of seniors on medicare. but that was not to be. and we know that. but we could not let them fall off the cliff and see their reimbursement rates cut 27.4%. contained in here are solutions for the long term and short-term that we're going to have to revisit. the other thing we did that's important is we're going to build out an interoperable public safety broadband network for our first responders our brave men and women, public servants, police and fire will finally have this congress answer the call that's been pending since 9/11. post-9/11 they said you got to

get our public safety people an interoperable broadband nwork and it didn't get done until now. when you vote for this legislation, you're voting to help your public servants and police and fire to finally have the tools to keep them safe and do their jobs. i yield back. the speaker pro tempore: the gentleman from michiga mr. levin: how much time is left for each? the speaker pro tempore: the gentleman from michigan has three minutes remaining the gentleman from maryland has one minute remaining and the gentleman from michigan in support has four minutes remaining. mr. levin: i yield one minute to the representative and leader in our caucus, mr. clyburn. the speaker pro tempore: the gentleman from south carolina is recognized for one minute. mr. clyburn: thank you very much mr. speaker, i thank my friend for yielding me the timism support this compromise because it ensures that we will

be able to continue tax cuts for millions of american workers and it preserves viable benefits for unemployed americans that are essential for the overall economy and safeguards seniors' access to their doctors. while i will vote yes, this agreement is not perfect. i have serious objections to the continuing demonization of public servants in the federal government. we should not keep cutting their pay and benefits while refusing to ask the top 1% to pay one penny more. federal employees have sacrificed now and they should be given time to share in the sacrifices all of us should. i'm also disappointed that this bill cuts money for prevention, which is so important to the

health of all americans. mr. speaker, i believe that an ounce of prevention is worth a poun of cure. thank you and i yield back. the speaker pro tempore: who seeks recognition? the gentleman from maryland. mr. hoyer: i reserve the balance of my time. the speaker pro tempore: the gentleman from michigan. mr. camp: i reserve. the speaker pro tempore: the gentleman from michigan reserves. the gentleman from michigan. mr. levin: i reserve. the speaker pro teore: the gentleman from michigan -- mr. camp: we're prepared to begin closing if y're ready. mr. hoyer: i think i have a go first. mr. camp: i yield the gentleman one minute. the speaker pro tempore: the gentleman is recognized for two minutes. mr. hoyer: i thank my friend the speaker, i'm glad he's in the chair. we have worked together because

we understand what needs to be done to meet the crisis that confronts our country. all of us need to participate, not just our federal employees, but all of us. in the short-term, we need to do -- in the short-term, we need to do what this bill does. 160 million people will get an exa $1,000 that hopefully will help build our economy, create jobs, expand opportunity for our people. the unemployed will make sure that they have that safety net critical for them and their families. the doctors will have a short period of time to have some confidence that they will be coensated to serve medicare patients over the next 10 months. the only people asked to pay for that, as i said before are federal employees. that's why i took this 20 mites, to say to each and every one of us in this house first of all, federal employees ought not to be the piggy bank out of which you pretend we'll be able to pay the deficit.

that's wrong. it's not been recommended by any of our groups. i've had the opportunity of working with mr. camp, who in my view is a very conscienous member of this body. i'm glad he's the leader. actually i wish mr. levin was the leader because he's of my party. but my party -- but since my party is not in control, i'm glad mr. camp lead us, he's a reasonable person. ladies and gentlemen of this house, america must know that we all need to ctribute. the federal employee has paid $60 billion over the last 24 months, over the next 10 years already, $ billion. and this year will have their pay reduced from what the law requires another $30 billion. that's $90 billion. forget about this bill, forget about the highway bill, which says $44 billion in additional reduction and benefits $134

billion is on the table. it hasn't passed, but it's on the table. let us as conscientious members of this congress, reesentatives of the people, come together and have a plan that does not require nickel -dim diming federal employees nickel-diming doctors nickel-diming medicare patients and nickel-diming america. let us come together and do what needs to be done. i yield back the balance of my time. the speaker pro tempore: the gentleman from michigan. mr. levin: how much time is left for mr. camp and myself. the speaker pro tempore: the gentleman from michigan has two minutes remaining, the gentleman from michigan on the proponents' side has three and three quarter minutes remaining. mr. levin: thank you. i yield myself the balance of my time. the speaker pro tempore: the gentleman is recognized. mr. levin: i think this has been a healthy discussion and i think all of us respect very

much the positions that have been put forth. i think we need to look at where we came from. the main bill before the conference committee was the bill that passed on a partisan basis here in december. it essentially would have countermanded the effort and continued mick growth through the payroll tax bill, it would have required very inimical pay-fors. it would have threatened the pay of 160 million people. that bill also would have cut drastically unemployment insurance, cutting umployment insurance is not reform. it is not reform.

people have worked for, these are people looking for work who can't find it. we have worked so hard so har to defend and to preserve the lifeline of unemployment insurance as best we could and essentially it does preserve in major ways through the rest of this year and for seniors, we have made sure that health care , their physician, is available. with respect to differing points of view, i strongly urge support for this conference committee report. it said it isn't perfect and it's often said no bill is perfect, but we have worked to preserve the basic ingredients to preserve economic growth and

preserve the unemployment insurance so critical for the unemployed of this country. i yield back the balance of my time. the speaker pro tempore: the gentleman from michigan, mr. camp. mr. camp: i yield myself such time as i may consume. the speaker pro tempore: the gentleman is recognized. mr. camp: this conference report extds the payroll tax cut to160 million working americans, it prevents a cut in physician payments through the end of the year so that seniors can get the medical treatment an care that they need under medicare. this represents about $800 for working families in america over the next 10 months, but most importantly this agreement includes no job-killing tax hikes to pay f more government spending. the deficit spending on unemployment stops with this legislation, this agreement firmly establishes that extensions of unemployment benefits must be paid for. this includes this legislation -- this legislation also includes some of the most

significant reforms to unemployment since the 1930's, job search requirements, drug screening and testing, reemployment programs, these are all critical for work readiness and for reemployment and these are essential reforms to the unemployment system. we also re-authorize temp assistance for needy families with this legislation but while doing so, make reforms to that program awell by closing the loophole that allowed welfare funds to be accessed at a.t.m.'s and in strip clubs liquor stores, and casinos. this bill, the government spening in this bill is fully offset. reductions to obamacare pay for more than half of the health spending in this leglation. and this also restores to the congress a process dating back to our founding fathers. they knew that at times government would be divided and that we couldn't always agree. this agreement was debated in public using that time-honored process and with that, i urge

all members to support this bipartisan house-senate >> president obama speaks at a bowling facility in washington state. and that newt gingrich a campaign rally in georgia. >> lcv stands for local content vehicle. we have three of them. the purpose of the vehicles is to collect programming from outside of washington, d.c. we staff each one of these with one person, a small camera, and a laptop editor. that is what we are doing. we want to get out the outside of washington, d.c., and collect

programming. will descend on each city with all three vehicles, one will do history -- history programming book tv, and community relations events. there are important to us because we work with our cable partners. the last thing that is important to note is all this goes on the air and it's archived on our website. we're doing extensive social media. you will see us on facebook, foursquare twitter. it is a chance to get out our message on air and also on line enters social media. that is why it is important. we wanted it outside of washington d.c. and make a commitment to getting outside the beltway.

>> watch our local content vehicles next stop in louisiana's. >> president obama concluded his west coast trip in washington with a torrent of a boeing production plans. elements of this plan include tax breaks to domestic manufacturers and increasing u.s. exports. this is about 30 minutes. [applause]

♪ [applause] >> hello. it is great to be in washington. not washington, d.c. washington state. it is great to be here at boeing. thanks for that great introduction. we were talking a little bit and she is a pretty good representative of boeing workers.

kathleen told me i have a motto -- every day, nobody will outwork me. that is a pretty good motto for boeing but for america. give kathleen a big round of applause. [applause] i have been told we are standing in the biggest building in the world. so big you can fit disneyland inside. your heating bills must be crazy. [laughter] i want to thank the host today. give them a round of applause.

[applause] [applause] one of the finest governors in the country is in the house tonight. [cheers and applause] i want to thank the mayor of average for having us here today. -- mayor of everett for having us here today. [applause] i want to thank all of you for giving me a pretty smooth ride. air force one was built here 25 years ago. in fact, i met one of my -- one of the guys i met during my tour worked on the plane. [applause]

so, i told him he did a pretty good job. [laughter] i get to see your handiwork in action every single day. but, as wonderful as it is to fly air force one, and it is wonderful, it is hard not to be amazed by the dreamliner. [applause] i noticed this one is going through united, one of our >> -- outstanding carriers. -- one of our standing -- one of our outstanding carriers. this is the first commercial airplane to be made with 50% composite materials. it is later. it is faster.

it is more fuel-efficient than any airplane in its class. it looks cool. [applause] the dream liner is the airplane of the future. by building it here, bowling is taking advantage of an opportunity to bring more jobs in manufacturing back to the u.s. boeing is taking an opportunity to bring more jobs and manufacturing back to the u.s. technology has made businesses more productive. that is a good thing. that is what raises our standards of living. it means we can get better products for less. but, that means that companies need fewer workers to make the same amount of product as they used to.

technology makes it easier for companies to set up shop and hire workers anywhere where there is an internet connection. so, the result has been this transition process that has been incredibly painful. a lot of communities that use to rely on a lot of factory jobs, they saw those get shipped off overseas. to many factories where people thought they would retire -- too many factories where people thought they would retire left home. jobs that provided a steady stable life, a middle-class life for people got shipped overseas. the hard truth is, a lot of those jobs are not going to come back because of these increased divisions. in a global economy, some companies are always going to find it more profitable to pick up and do business in other parts of the world. that is the nature of a global

economy. that does not mean that we have got to sit there and settle for a lesser future. i do not accept that idea. as you do not accept that idea. america is a place where we can always do something to create new jobs and new opportunities and new manufacturing and new security for the middle class and that is why i am here today. that is our job. that is what we are going to do, together. [applause] just today, we took an important short-term step to strengthen our economy, just before we got here. congress did the right thing and voted to make sure that taxes would not go up on middle-class families at the end of this month. [applause]

congress also agreed to extend unemployment insurance for millions of americans. maybe some of your family members who are still out there looking for a job. i am going to sign this bill right away when i get back home. [applause] this middle-class tax cut is something our proposed -- i proposed back in september. because you kept the pressure on congress and reminded people what it means to have $40 taken out of your paycheck every week, it got done. this is a big deal and i want to thank members of congress to listening to the voices of the american people. it is amazing what happens when congress focuses on doing the right thing instead of just playing politics. this was a good example. congress should take pride in it. [applause] but, the payroll tax cut is just a start. if we want middle-class families to get ahead, we have to deal with a set of economic

challenges that were present before the recession. we have a choice right now. we can either settle for a country where few people do really well and everybody else is struggling or we can restore the economy where everybody gets a fair shot. everybody does their fair share. everybody plays by the same set of rules from washington to wall street to main street. everybody is doing their part. [applause] we are still recovering from one of the worst economic crises in three generations. the worst in our lifetimes. we have still got a long way to go to make sure everybody who wants a job can find one and every family can regain that sense of security that was slipping away even before this recession hit. the tide is turning.

the tide is beginning to turn our way. over the last 23 months, businesses have created 3.7 million new jobs and american manufacturers are hiring for the first time since 1990 in the american auto industry is back and our economy is getting stronger. that is why we can look towards a promising future. [applause] boeing is an example of that. to keep it going, the last thing we can afford to do is go back to the very same policies that got us into this place in the first place. [applause] we cannot go backwards, we have to go forward. we cannot go back to an economy that was weakened by outsourcing and bad debt and phony financial profits. i want us to make stuff. i want us to sell stuff.

in the state of the union, i outlined a blueprint for an economy that has a strong condition. an economy based on american manufacturing. american know how. skills for american workers. and of the values that made america great. the values that kathleen talked about. hard work and fair play and shared responsibility. that is what america is about. that blueprint starts with american manufacturing. it starts with companies like this one. a lot of people say, there are going to be fewer manufacturing jobs than there were in the past. i already said, we are more efficient now. what used to take a thousand people to make, you might only need 100. we understand that. we want to make sure we are promoting service industries, as well. manufacturing has a special place in america. when we make stuff, when we are selling stuff, that creates jobs beyond just big plants.

it raise its standards of living for everybody. orders for commercial aircraft rose by 50% last year. to meet that demand, boeing hired as 13,000 workers all across america, including 5000 right here in this city. [applause] now, the biggest challenge is how to turn out planes fast enough. that is a high class problem to have.

this company is a great example of what american manufacturing can do. in a way that nobody else can do. the impact of your success, as i said, goes beyond the walls of this plant. every dreamliner that rolls off the assembly line years supports thousands of jobs in different industries all across the country. parts of the fuselage are manufactured in south carolina and kansas. wing edges come from oklahoma. engines assembled in ohio. tails come from right down the road in frederick sen. the people in these communities are benefiting from the work that you do. all of those workers spend money at a local store.

they go to restaurants. the service economy does better because you are doing well. what is happening here can happen in other industries. it can happen not just here, but in cleveland, pittsburgh. we can bring every job back. it is getting more expensive to do business in places like china. american workers have never been more productive. companies like boeing are finding out that even when we cannot make things faster or cheaper than china, we can make them better. our quality can be higher. that is what america is about. that is how we are going to compete. [applause] during the state of the income i issued a challenge to american business leaders. i said, ask yourself what you can do to bring in create jobs here in this country and your country will do everything we

can to help you succeed. i am encouraged. we are seeing a number of companies, large and small domestic, but even for and recognizing -- we're going to open new facilities and create new jobs here in america. this is a good place to work. it is a good place to be. our job as a nation is to make easier for more of these companies to do the right thing. that starts with our tax code. companies get tax breaks for moving jobs overseas. >> boo. >> companies that stay in america get hit with one of the highest tax rate in the world. that does not make any sense. so, my message to congress is, what are we waiting for? let us get this done right now. let us make some changes to the tax code. [applause]

let us follow some simple principles. first, if you are a business that wants to outsource jobs that is fine, but you should not get a tax break. that should cover moving expenses for companies that are bringing jobs back home. that is to should be getting tax breaks. [applause] second, no american company should be able to avoid paying its share of taxes by moving profits overseas. my attitude is every multinational company should have to pay a minimum tax. you should not have an advantage by building a plane over there over somebody who is investing here and hiring american workers. [applause] every penny of that minimum tax

should go towards lowering taxes for companies like boeing that choose to stay in the u.s. [applause] number 3, if you are an american manufacturer, you should get a bigger tax cut. if you are high-tech, you should double the reductions you get for making your products here. if you want to relocate in a community that has been hard hit, like factories leaving town, you should get help. financing the equipment or training for new workers. it is time to stop rewarding companies that ship jobs overseas. reward companies that are creating jobs right here in the united states of america. kind risch -- congress should send me those reforms. i will sign them right away. [applause] another thing we are doing to support american jobs is making

it easier for businesses like boeing to sell their products all over the world. two years ago, i set a goal of doubling u.s. exports in five years. we are on track to achieve that goal. we are ahead of schedule. last of member, when i was in indonesia, boeing announced a deal with the help of an export import bank to sell more than 200 planes to one of the fastest growing airlines in the world. boeing is one of the largest exporters in america. this is one of the biggest deals boeing had ever done. over the years, it will help support and thousands of american jobs, including jobs here in washington state. i say, i deserve a gold watch because i am selling yourself all the time. [laughter] i will go anywhere in the world to open up new markets for american products.

by the way, i will not stand by when our competitors do not play by the rules. [applause] [cheering] that is why i directed my administration to create enforcement unit that only has one job at -- investigating unfair trade practices in countries like china or places like europe. that is why it is so important for congress to reauthorize the export/import bank. this bank -- [applause] this bank is led by a man who is out there working on behalf of boeing. the export/import banks help companies like this one sell its products. it also helps thousands of small businesses. today, the bank will be launching a new program to help small businesses get the financing they need to sell more products overseas.

i am also instructing the banks to give american companies a fair shot by matching the unfair export financing that their competitors receive from other countries. [applause] you know, american workers you guys, looks like kathleen, you are the most productive on earth. you can compete with anybody. you will outwork anybody as long as low-level -- the playing field is level. you can compete with any worker, anywhere, anytime. it does not matter, if we have a level playing field, america will win because we have the best workers. [applause] it is also because we have always believed in the power of innovation. innovation requires basic research.

look at this plane. this was first designed virtually. using the same technology that was developed by nasa. government research helped to create this airplane. i was in there fooling around with those windows where you press them and a dam on their own. i kept on pressing the button. one touch, one finger. the display is in the cockpit -- it is projected on the windshield so pilots do not have to look down. they can maintain their line of sight even as they are getting all of these readings. some of the work, the most advanced work, was done by engineers in alabama who used to work on the international space station. their expertise and a lot of those ideas came out of government research.

we have got to support this kind of cutting edge research. [applause] we need to maintain our innovative edge so that jobs and industries take root here in the u.s., not some place else. [applause] if we want to build an economy that lasts and is strong and has a strong foundation, that helps families get into the middle class and stay in the middle class, we have to do everything to strengthen american manufacturing. we have to make sure we are making it easier for companies like boeing to create jobs here at home and sell our products abroad. we have to keep on investing in american made energy and we have to keep training american workers. above all, we have to remove the values that have made this -- we have to live by the values that

have made this country great. these are not democratic values or republican values, these are american values. [applause] they have seen us through some tough challenges. we have always emerged stronger than before because of these values. we are going to come out stronger than before, this time as well. i know it because of the people who are here. in december of 2009, the first green minor took off -- dreamliner took off. some of you were out there. i t was a cold, windy day. that did not stop 13,000 employees, all from coming out to sea -- to see the product of their hard work filling the sky.

one of these people what sharon o'hare. she is an executive office administrator for the leaders of the streamliners series. she is basically doing all of the work. [laughter] she has been undergoing treatment for cancer recently. she has our own battle. she is healthy enough to come back to work. that is worth applauding. there are a lot of people who are happy to see you back at work. as she tells the story about

watching the first airplane lift gently off the runway, just the way it was designed to do, she thought about everything that had gone into making this day possible. all of the challenges. all of the setbacks. and that thousands of hours of brain power and manpower and womanpower. [laughter] [applause] [cheering] what she says is, "i had goose bumps and years. we said we would do it and we did." that is a pretty good model. you said you would do it and you did. that is what we do as americans. that is the spirit we need right nail in this country. -- right now in this country.

even in times of sorrow, we reach for new opportunities. we pull each other up. we stay focused on the horizon. that is who we are. that is to we have always been and if we work together right now with common purpose and a common effort, i have no doubt we will build an economy that lasts and we remind the world why the united states of america is the greatest country on earth. [applause] we said it. we will do it. god bless you. god bless the united states. thank you. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012]

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>> gingrich at a campaign rally in georgia. after that, former budget director discusses the u.s. economic outlook. a conversation with former wyoming senator alan simpson. >> in 1966, at julian bond was prevented from taking his seat in the georgia house. his appeal went to the u.s. supreme court. >> i went to the court to hear the argument and i was sitting in the court just behind the bar. i was sitting next to my lawyers partner. the attorney general of georgia was making an argument that georgia had a right to throw me out because i had said things that were treasonous.

i think it was judge white said is this all you have? [laughter] this is all you have? i said, we are winning, are we? >> discover more about african- american history during black history month. over 25 years of c-span programming at c-span.org. >> newt gingrich holds a campaign rally in georgia. this is the atlanta up regional airports falcon field's. he is campaigning in georgia. 76 delegates are at stake in george's election. ♪

tonight, it is my honor to introduce miss gingrich.

to watch her on the campaign trails have spent just absolutely wonderful. she has put in more hours than you can manchin. she has not complained. she gets up every day. she smiles. as she does now. she is always smiling and she has been such a support in this campaign. i am thrilled, not only because she is so good in the campaign, but she is also a new york times best-seller. [applause] go get her book. most importantly everyone should know that she is really behind my father. she is with my father every day.

she works incredibly hard. i am thrilled to be here with her tonight. please give her a very warm welcome. [applause] >> thank you. thank you for the kind introduction. it is great to be back in peachtree city. it is wonderful to be back in georgia. being back home in georgia always makes newt gingrich very happy. we are pleased to be back here. as some of you know, he went to high school in columbus. he taught at west georgia. he represented georgia and congress for 20 years. [applause] starting as a volunteer in 1960, he helped to grow the georgia gop until the -- into the great

party that it is today. we are so proud of our volunteers who have been working diligently at our headquarters in atlanta and throughout the state of georgia. we are grateful for your support. we are engaged in the race because we believe america is at a crossroads and we care deeply about the future of the country. there are only a few months left before the most important election in our lifetime. our only opponent is barack obama. we are committed to removing him from the white house. [cheers and applause] newt gingrich is the only candidate with the experience and knowledge necessary to rebuild the america we love. [applause]

he has a successful national record of creating jobs, balancing the budget, and reforming the government. today we need a leader who can clearly articulate why president obama and his policies are wrong for america. [applause] we need a leader who understands that we must contain and defeat our enemies. we need a leader with bold solutions to create a better future for all americans. [applause] i believe that leader is my husband. please welcome former speaker of the house and the next president of the united states newt gingrich. [cheers and applause]

>> first of all, i want to thank all of you for the warm welcome. i want to thank jacki. jackie and our two grand children, i am grateful they are here. some of you may have seen her they were on hand at the -- hannity last night. i have to say they have also been doing more than their fair share. i am grateful for their leadership. i am surrounded by authors. she also has a two books out and writes a weekly column.

we have all of these talented people that we are hanging out with. i want them to stay up here for a couple of reasons. they have been my debate coaches. maggie is my smile coach working on me to smile more. robert who is a chess player has been trying to get me to be shorter and clear in my answers. you can imagine they were both disappointed to see the chicken show up tonight. [cheers and applause] they have been looking forward to having mitt romney and rick santorum come to georgia and have a debate. it was disappointing when they decided they did not want to

run the risk anymore of being outside of their advertising. let me tell you, if you are afraid to debate newt gingrich, you sure can not debate to barack obama. [cheers and applause] i am going to ask them to reconsider and come to georgia. it will be just fine. [laughter] we will be hospitable. frankly, there is something wrong when somebody tries to buy their way to the presidency with a series of negative ads and will not stand up out in the open and defend it. [applause] this is the most important election in our lifetime because barack obama is the most radical, the most destructive the most and constitutional president we have ever had.

[cheers and applause] when he appoints czars without senate confirmation, he is operating outside of the constitution. when he appoints recess appointments and there is no recess, it is a clear and direct violation to the constitution. [applause] when he declares war on religious liberty, he is clearly violated the first amendment of the constitution. [cheers and applause] when he produces a budget that cripples the military of the united states, he is violating his duties as commander in chief.

[cheers and applause] we have to confront how really important this decision is. not just obama, but the bureaucracy, the judges, the laws, all of the things that have america on the wrong track. the reason we decided to wrong is because we thought it was really vital not just to be to obama but to win a victory based on principle. to win a victory based on solutions. to have the strength of the american people to say to the u.s. congress, we expect you to actually work with the new president. we expect you to actually get things done, not just to bicker and fight all of the time. [cheers and applause] and let my competitors, i have twice participated in very large agenda elections.

in 1980 i was working with ronald reagan. we developed the capitol steps. we came together. he was a clear underdog. we all came together on the capitol steps with gov. reagan. we pledged five major changes. we 16 u.s. senate seats. we stood for something. -- week 16 u.s. senate seats. we created 16 million new jobs. -- we won 6 new u.s. senate seats. you might remember we had a problem with gasoline back then. we were rationing it. i had a friend who was 13 that year.

he was sent out back every morning with a screwdriver. he had to make sure that the car that needed gas had the right license number. i will tell you the difference between liberal and conservative. when the conservative here the government has a regulation so stupid we are teaching 13 year olds how to break the rules, the conservative says drop the rule. the liberal says that is why we need a license plate police at every gas station. [applause] in 1994 we developed a positive agenda. we had the largest one party increase in american history. we won control for the first time in 40 years. we actually kept our word and voted on every item in the contract in the first 93 days. the result was the american people thought we were serious. they thought they could trust us. in 1996, we became the first reelected house republican majority since 1928.

[applause] now, i tell you that because i want to run a principled campaign this fall, a very -- i want to run a campaign of a very large ideas. i want to show that over here is obama, over here is gingrich. i want to run with a team that commits that if they get elected and control the house and senate, they will stay in session on january 3. by the time i am sworn in on january 20, we will have repealed obamacare -- [cheers and applause] we will have repealed the dodd- frank bill that is killing small banks. we will have repealed sarbanes

oxley that is -- on january 20 within a couple of hours after being sworn in, we will already be signing three major bills starting to get rid of the obama administration's imprint on the one. [cheers and applause] we will go further than that. on the first day i am president, i will sign a series of executive orders. all of them will have been published by the first. the election will be about whether or not to do it. the first executive order will abolish all of the white house czars as of that moment. [cheers and applause] i will also sign an executive order implementing the keystone

pipeline as of that date. [cheers and applause] i want to say to our friends in canada, you do not need a partnership with china. you'll have a new president and agreement. you will be able to build the pipeline right through the united states. [applause] on that very first day, i want to sign an executive order that moves the american embassy to jerusalem and recognizes israel's right to exist. [cheers and applause] we want to run an american campaign. i am running for the republican nomination. the issues i want to run on our american issues. we want to appeal to every american of every background of every ethnic group in every neighborhood.

i will give you a couple of examples. this is the biggest thing that makes me different than my friends running for the nomination. i know how to do large things in washington. i am prepared to be very bold in defining what we need to get done. i know how to get bold things done. i did it working with reagan in the 1980's and i did it as speaker of the house in the 1990's with clinton. it is not talking points are what my consultants gave me. is not a random idea. i know this can be done. i am prepared to commit to you that we will get it done if you help us get to the nomination. [cheers and applause] we collectively as the american people should demand that washington achieve. the first and most direct

relates to national security. look at the miss in the middle east. look at the unreliability of our allies. we need an american energy policy to be independent from the middle east. [cheers and applause] we need an american energy policy so powerful and so compelling that no future president will ever again bow to a saudi king. we know this is possible. in north dakota there is an explosion of oil available. it is on private land and the liberals cannot stop them from developing it. they believe they have 25 times

-- not 25%, 2500% more oil reserves in north dakota than they thought they had 20 years ago. the current unemployment rate is 3.5%. that is actually a mistake. there are 16,000 to 18,000 jobs available. they have a mismatch that is really a training problem, not an unemployment problem. revenue from oils have gone up so fast. they have had seven straight tax cuts. they have a multi-billion dollar rainy day fund. you would think that barack obama would look at north dakota and would say, wow. we could create jobs. we could create energy. we could strengthen the national security. we could get royalties to the federal government. no. this administration is actively

trying to slow down and make expense of the development of oil, even on private land. the u.s. attorney for north dakota, obama's appointee, he filed a lawsuit over a eight migratory birds. they have not filed any lawsuits over wind that kills thousands of birds a year. that is a green energy which obama likes. that is a necessary price of being green. they went out of the way selectively. a judge threw it out recently. this is the kind of selective violation of the rule of law. this is as bad as the solyndra case. you had an attorney selectively applying the law to undermine a solution that the american people want but barack obama is opposed to. the secretary of interior announced he wants to establish new federal rules that will slow down and maybe even stop the development of natural gas and shale which is an enormous

success story. has the liberals going crazy because it turns out we do not have peak energy. we now have over 100 years' supply of natural gas. we are about to prove the same thing with oil. we are going to prove there is so much oil available in the united states that it is absurd to talk about pete will. why is this happening? this is the heart of the conservatism i believe in. this is happening because science and technology and entrepreneurship is finding new and better solutions. they say we have to regulate the present. it is exactly the wrong answer. it is an american answer. here is a side effect. as president, i will open up offshore development of oil and

gas. i will open up federal lands to develop will and gas. [cheers and applause] -- develop oil and gas. this energy policy will have four goals. one, to make as independent to the middle east and venezuela so we can say to dictators, we do not care what you think. we are not going to tolerate you funding terrorism. [cheers and applause] two, the development of royalties on federal property will be a major source of revenue without a tax increase. the leading developer in north dakota believes we could earn 18 trillion dollars in royalties from oil and gas. that is more than the current entire debt. although if obama keeps going, that will not be true.

three, i want the whole country to resemble north dakota. let's get back down to about 4% unemployment. that is where it was when i left office. let's put americans back to work. energy does that. [cheers and applause] there is a fourth virtue out of the energy program. you can see all of this if you go to newt.org. it goes back to something we did in 2008 called drill here drill now, pay less. my goal is to get back to $2.50 a gallon gasoline so people can afford to drive. [applause] now, the news media will be skeptical. the liberals will be apoplectic.

the establishment will be nervous. let me remind you of some facts. when i was speaker of the house, the average price of gasoline was $1.13 a gallon. when obama was sworn in the price of gasoline was $1.89. the idea of setting as a goal somewhere between $2 and $2.50 a gallon by producing so much petroleum in the united states the demand is not as big as supply. remember there are two ways to do this. the liberals are trying to drive down demand because they are convinced you cannot have supplied. they're trying to make sure you do not get any supply by making it impossible to go out and develop fields. i want to open up the field dramatically expanding the supply of american petroleum. my prediction is that with a gingrich presidency, by 2020 we will be the largest producer of petroleum in the world, bigger than saudi arabia and russia.

[applause] once you accept the reality. in california there is an estimated 80 billion barrels of oil. there are all sorts of places that liberals do not want to talk about. it destroys their reason for controlling our lives. i would add to the energy program to abolish the cafe standards to allow the auto companies to actually produce the car you want to drive. let me point out. when they made cars smaller and smaller, americans bought trucks. [laughter] this drives the liberals crazy. how dare we go out and buy vehicles bigger than their bicycle? [laughter] i am trying to get across a simple principle. i will let you judge of this is right.

i have nothing against people who want to go out -- the volt is an interesting, experimental car. this is obama's idea of populism. he wants to increase the amount given to every volt buyer to 10,000 dollars. which is an amount that would allow a lot of people to buy is secondhand car but it would not be an obama car. here is my point the volings. you cannot put a gun rack in a volt. [applause] let's be clear what this election is all about. we believe in the right to bear arms, and we like to bear the arms in our tracks. there! [applause] an energy program is a major step toward full employment. if you go to newt.org, you will

see tax policies that get us to full employment. you'll see tax regulatory reform that get us to full employment. i believe just as ronald reagan created 16 million new jobs in his presidency, i believe with your help of we can get a congress willing to work with us we can create full employment in america. our goal is to bring people back into the workforce and to get down to 4% real unemployment with everybody who wants a job getting a job. there are practical things we can do to achieve that. these are big changes. there are two other places i want to talk about with big changes. we need a president who is committed to protecting religious liberty in the united states, period. [applause] we have had the judges for 60 years trying to drive god out of the american public life.

we have had bureaucrats, state legislatures. there is a clear conflict under way. between secular bigots who'll do everything they can to undermine, weaken and cripple religion. the vast majority of americans to believe our rights come from our creator. this is the heart of what i want to debate obama. i do not believe he can defend his radical views. i do not believe he can explain. let me give you two examples. the declaration of independence says "we are endowed by our creator with certain unalienable rights among which are life, liberty, and the pursuit of happiness." this says two things to me. the first is, every school should teach in the declaration of independence and should explain with the word "our creator" meant.

[applause] the founding fathers set our rights are inalienable. that means no president, no judge, no bureaucrat can come between you and god. that is why it obama is a profound assault on the american liberty in which he is trying to do. [applause] one of the first executive orders -- this will be a work in progress. we will want to study the administration right up to the last day. one of the executive orders will in one sweeping order repeal every anti religious act of the obama administration as of the 20th. [applause] the second example of that, i urge all of you some day to read lincoln's second inaugural address.

march of 1865. shaped by four years of work 620,000 dead americans -- more than all of our other wars combined. oppressed with the feeling of his own heart that he bore that pain. he writes an inaugural of 702 words that mentions god 14 times and has two quotes from the bible. i say to my liberal friends. how would you explain america and its get 14 references to god and two quotes in the bible in one speech? how can you possibly believe that in real america can be a secular place in which god has no dignity. in which nothing can be mentioned in public. in which only secular bureaucrats and secular judges define who we are. that is not america. that is an alien country which

we will defeat this fall. [applause] finally, we need to debate this president on his utterly and totally irresponsible approach to national security. no president in my lifetime has as methodically undermined our defense system as barack obama. his budget proposals are devastating. it is inconceivable that we will be safe if he is allowed to carry out his plans. i wear this pin. this is george washington's commander in chief flag from valley forge. it flew in front of his headquarters during the revolutionary war. i wear it to remind myself and to remind you that when they

wrote the constitution, the man presiding over that meeting had spent eight years in the field as the commanding general. when they wrote the president as commander in chief, they had a pretty good idea what commander in chief meant. barack obama is derelict in his duties as commander in chief. he is putting his ideology ahead of defending the country. [applause] now, it is great to be home. i believe i have carried the county in every election, including the two that i lost. [laughter] i felt really good coming back and really get to being here in peachtree city. i will tell you, i remember one election in 1990 that was so

close that at 2:00 in the morning i was still behind running for reelection. ran the evans who was my -- randy evans who was my chairman called and said, do not worry about it. there are four large fayette county precincts still out. when they come in you will win by about 2300 votes. he was off by about 40 votes. there is a special warm place for fayette county. i ran against white house and against republican leader. i won by two votes. 89-87. i am used to close campaigns. this has been a little bit like riding a roller coaster. in fact, i tell people it is a little bit like the roller coaster at disney that is in the dark. have you ever ridden space mountain? you don't know what's coming next. you're not sure where you were

and you're not sure where you're going. the primary in georgia is very important. i need your help. nobody should take it for granted. [applause] this is a wide open race. the establishment has decided that we were inevitably going to nominate mitt romney. wall street had decided that we were inevitably going to nominate mitt romney. that is now wide open. i think it is pretty hard to argue over the past few days he is mr. inevitable. rick santorum has come out of in where. we were there this summer when tim plenty came out of nowhere. we were there when michelle bachman came out of nowhere. my good friend herman cain who will be campaigning with me tomorrow came out of nowhere. [applause]

my good friend rick perry came out of nowhere. we just kept trotting along. we will see in the next few weeks how mr. rick santorum does. the fact is, i am the only candidate in this race who has stood nose-to-nose with presidents of both parties and not flinched. i am the only candidate in this race -- [applause] -- i was against tax increases when democrats were doing it and i was against it when republicans were doing it. i did not flinch. i was the only one that put together large national elections that changed the country. past the first tax cut in 16 years, and the largest capital gains tax cut in history when

unemployment rate dropped to 4.2%. with that we got the 1997 balanced budget act and it was balanced for four consecutive years for the only time in your lifetime. [applause] with your help, if you will go back home and put this on facebook and tweet it and send out e-mails and call your friends. maybe in an old fashioned way actually see people, make sure they vote. with your help we will win the primary. that is a big piece of winning super tuesday. if we win super tuesday, we are back in the game. for the third time, we'll be moving back toward front-runner status with your help. thank you, and good luck, and god bless you. [applause]

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>> next, peter orzag discusses the u.s. economic outlook and then a conversation with alan simpson and after that, the house debate on extending the payroll tax cut. book tv is live saturday with tom clava with "the last hours of war" and scotty smiley at noon. at 1:30 eastern, the palestinian conflict. looking at who is afraid of post blackness at 4:00. at 5:15, the rise and fall of the comanches.

peter orzag next talking about the economic outlook for the u.s. he explains the causes of our current economic downturn and what is ahead for the coming year. from the executives club in chicago, this is 53 minutes. e back in chicago that happens to be my favorite american city. [applause] a round of applause for that. it is linked to very much to the financial times. thank you very much for having me. it is my great honor to introduce the man that president barack obama called his propeller haead. -- head.

it was a funny kind of complement. i am sure that you all agree that it is not an aspersion on his good looks. instead, it all makes sense when you realize that the propeller is inside his agile and compendious brain. it spins around very fast indeed. this man matched equations with larry summers and the white house. he has the resume -- the fantastic hamilton project at the brookings institution. director of the congressional budget office. president obama's budget director, and the head of global banking data citigrou -- at citigroup. there was ambition and scope that he brought to all of those jobs. he is one of the nation's

leading experts on the budget and one of the leading experts on the microeconomics of health care. if you want to know how to bend the cost curve on your rising health insurance costs, he is the man to talk to. peter is a self-confessed geek. his public life is not something you can say about many geeks. many economists will bludgeon you with theories and numbers. when i read peter's columns they connect the dots to a pattern that i realize i should have known was there but i did not see it until he showed it to me. please welcome me in the -- help me in welcoming peter orszag. [applause]

>> thank you, robin. thank you for joining us this afternoon, i am delighted to be here with you. i was like to talk to you about a few overarching things that are affecting the u.s. economy. i hope to use an empirical basis to connect some dots. even when i tried to be empirical, the world does not always turn out as i expect. the most compelling affect of that is after having been confirmed in record time as the director of office and management and budget, assembling talked advisers to join me, i almost said the white house on fire since the war of 1812 -- on fire for the first time since the war of 1812. imagine this, it is a labyrinth in quite draftee. i was working the first weekend in office. it was cold and no way to adjust the thermostat.

so i noticed there was, in the sellout barrette office, a fireplace in which there was a fire screen at the next to it were some fire tools. and next to that, some logs. that suggested an operational fireplace. [laughter] being empirical, i decided to test the proposition. i made sure that the smoke would go up the chimney, the experiment worked perfectly. i moved the logs into the fireplace and i thought life was looking grand. the room is warming up nicely, five minutes and, i am getting work done. the fire alarm goes off. the secret service is clear in the hallways and somewhat was surprised someone was telling a four letter word and it did not

come from rahm emanuel. [laughter] i tried to tell them that there was a fire burning in my fireplace. they say, don't worry about it please evacuate. there is an electrical fire on the fifth floor. the to the coffee shop across the street. the secret service came to collect me because i was the culprit. about five years earlier unbeknownst to the first secret service agent, another part had capped the chimney as a security precaution. once it got to the top, and had nowhere to go except into a fifth floor conference room. my phone rings and i got a phone call from my mother that said, i am so proud of you, you are on television. [laughter]

i say, they don't have the sound don, do they? hopefully what i am about to talk to you about doesn't have such dire consequences as evacuating an entire white house complex my first weekend in office. we are at a very rare moment in the u.s. economic history. it is extraordinarily rare for an underlying tectonic plate shift to be affecting the economy at the same time that you have an overlay of a financial crisis. the only time that has happened in the last century was during the great depression when the economy was evolving from agriculture to manufacturing. that was a tectonic plate shift, and we had an overlay of financial crisis. it is an extraordinarily rare occurrence and we are living

through it right now. the underlying tectonic plate shift can be expressed in lots of different ways. the way i like to look at it one of the first thing is taught in macroeconomics is that the share of national and come that a cruise -- income that accrues -- it looks like it is going down. the reason is happening, we are living through a dramatic change in terms of a globalized labour market or increasingly globalized labour market. there are lots of estimates, but basically, effectively, the labor supply has doubled to quadrupled at the same time the global capital supply has not. the result of that shift is a downward trajectory and labour's share of national

income. if you want to understand some of the frustration that people are clearly expressing, one way of looking at that is that if the labour share had been constant instead of declining labor would be earning $500 billion-$750 billion a year greater. you have a lot of frustration but got a lot of policy prescription to address it. the manifestation again, one of them is the declining labor share. the other is stagnant, real wages for many american workers. this chart shows you what is

happening to the worker at the fiftieth percentile, right in the middle of the wage distribution of the united states. the red line shows you that those working full time year round, their earnings have been flat. once you include the people that don't have full-time work on the blue line, if anything there has been some decline. it has been shown in family income as well. the bottom line is for married couples right at the fiftieth percentile where there is only one spouse working. and not surprisingly, given earnings have been flat, our earnings distribution family income has been flat if there is only one worker. the reason that we have had some modest uplifted median income, the top line, is solely because it is increasingly likely that both spouses work.

that is the underlying tectonics' plates shifted being driven not only by technological change that we can discuss in addition, but transportation costs and a globalized labor pool that is causing a significant shift. i also mentioned that to date, it has affected those up to the seventy fifth percentile disproportionately. i strongly suspect that it is reaching out further into the income distribution. anything that can be digitized is subject to the same force. it opens up a series of other occupations and skill sets relative to the effects that were primarily felt in the past. what about the overlay of the surface waves we have been living through? one way of looking at that is to examine total private-sector borrowing.

in the united states, it reached a 30% of gdp in 2007. in 2009, is m wasinus -- it was minus 15% of gdp. it would count as economic trauma under any definition of that term. the result has been, as with most experiences with other countries have suggested a sluggish recovery. it is fundamentally different to a downturn caused by excess inventory, the central bank tries towring inflation out of the economy -- trying to wring inflation out of the economy. is hard slog. it takes time to deleverage. it has the housing sector

feeding on to a weak economy and back on the housing sector. it takes time to work its way through. that is what has been happening in the united states. this is the share of the population that are working. you can see it falls off a cliff at the same time the total private sector borrowing, the financial crisis, hit. the key thing, it has not come back. it has remained at a subdued level for the past two or three years. this is fundamentally different from other recent downturns. we're the red line there. the one that falls that doesn't go anywhere. the other recent downturns are of less severe in the collapse of employment to population ratio or the share of the population working, and they

tend to come back more quickly. i would also note that every single formal macro econometric model, from the federal reserve, private sector forecasts, they all got this wrong. in the beginning of 2009 they were suggesting a rapid and more v-shaped recovery. despite the fact that a financial crisis is different from other downturns. for example, for this year if you look at the forecast from the congressional budget office in january 2009, they were projecting an unemployment rate for 2012 of 6.8%. anyone willing to take that bet with me has to take the other side of if we are going to hit 6.8% or not this year. fundamentally, the nature of this l-shaped recovery was absent from every single formal model.

the only people that got that right were basing their analysis on history or some other process, not a formal model. the lesson i take away from that, there are lots of people that will walk around with very precise estimates of a fundamentally on certain things and you have to pay attention to that -- of fundamentally uncertain things, and you have to pay attention to that uncertainty. frankly, we can still do -- i will give you one example. there is a lot of debate over whether the initial 2009 stimulus should have been a lot bigger. i did not think that would be legislatively possible but let's say that congress would have voted for -- i wish i could tell you it would have been the case. but a $1.20 trillion stimulus.

this is a very temporary problem, it would have all been delivered in 2009 and early 2010. 2010 would be stronger, but 2011 and 2012 would not have been that much different at all. what it misses is the time dimension. it would be far better to tie things to the unemployment ratios of that they remain in force as long as the economy is weak. there is false precision at the end of this year, that support will no longer be necessary. where are we in this hard slog? we are part of the way through it but not all of the way through it. the only debate is if we are mostly or halfway through. this is one way of looking at

that phenomenon. the share of vacant homes, share of homes offered for sale that are vacant, it goes up following the financial crisis. it is on its way down, but we are depending on the estimates between 500,001 million more homes vacant and being offered for sale that under normal -- 500,000 and 1 million more homes vacant and being offered for sale than under normal conditions. so there is a tectonics' shift and surface waves to the financial crisis. with regard to the latter, it is a simpler set of solutions. my solution would be more support for the economy now coupled with a deficit reduction that is enacted mal to take effect over time. -- enacted now to take effect over time. with an elevated the

unemployment rate, debt rises quickly. combine it with a deficit reduction that takes us back with delay. the underlying tectonic plate shift by contrast is much harder to respond to. typically, what we argue is that what we need to do is more education and better more investment in infrastructure. those will help, but this force is so powerful that we should not hold up the false hope that we will online dollar that. -- have to unwind all of that. let's look at what is possible there. it is often not noticed that we

have had, up until those that were born in about 1950 or so, wind at our back, from reaching educational attainment. the rate of increase has slowed dramatically. those born 1950 and after educational attainment has risen, but not as fast as earlier generations. you can see earlier in this slide that breaks it down into different time periods between 1940 and 1960, it is mixing that a bit. the supply of college graduates is growing very rapidly. this is for the actual years sorry. today, there is much less rapid

growth. there is still an increase in college enrollment, but it is rising at a slower rate than previously. that diminishes the underlying economic productivity growth. another effect of it is to raise the premium for college workers. since supply is growing less rapidly and at the same time we have at the technological change in the underlying tectonics' played shift that raises the demand for college workers, you have a right not and how much college-educated workers are relative to those -- you have a run up on how much college-educated workers earn relative to those that are not. how do we get back on the path of rapid educational attainment? the answer will involve a lot more attention on lower and middle income and romans and

completion of college. -- enrollment and completion of college. that is where the most improvement is possible in the lowest 20%-40% of the population. there is a very steep gradient to college enrollment by income. some people argue that that is because low-income kids are not prepared for college, and there is a significant component to which college preparation does vary by family income. one of the things that we should be disturbed by, take a look at this chart. this shows you what your scores were like in a standardized test in eighth grade and what the subsequent college enrollment rate was by family income. what i want to draw attention to, the lowest performers from high-income families are enrolling in college at the same rate as the highest performers

from low-income families. that is a problem. we need to make sure that the highest performers regardless of income, get the opportunity to go to college. it will help us, it is fair, and it will get us to rapidly rising educational attainment overtime. all of these forces have led to what is widely described and widely known as a rise of income inequality in the united states where the sluggish growth in the middle has occured at the same time as very rapid growth for the top 10% and top 1% over time in the united states. and the tax code has offset part of that, but not much of it. the policy discussion often

says, what are we going to do about this rather than other education. it will take time to move kids through college, community colleges, it plays out over a law period -- along period of time. with regard to the tax code, it works quickly, but we should not expect it to be a full solution here or anywhere close to a full solution. most of the increase that has occurred has occurred with regard to pretax income. there is no plausible set of changes one can put into play where you can take this chart and offset any significant share of that over time. the tax code can help a bit, but it is not a full solution. we should not hold out false hope that this is going to

change instantaneously. what are the implications of all this? there are some implications with regard to differential spending patterns. those of you in retail have undoubtedly noticed that high- end retail has been doing better than mid-tier and a discount retail over the past couple of years. another implication has to do with income mobility. we like to pretend there is a huge amount of mobility from one generation to the next in the united states. it has been more of a myth that we would like to believe. what a way of looking at that is this chart. if you were born into the bottom 20% of income distribution in the united states, there is a 40% chance that as an adult you are still in the lowest percentage of the distribution and only a 6% chance that you are in the talks.

similarly, there is a 40% chance you will remain there as an adult and only a 9% chance that you decline to the bottom 20% as an adult. is this related to, or is there any implication of changes of the income inequality for income mobility? they're essentially different topics. as income inequality goes up, mobility goes down. there has been recent controversy over this. this is a chart from alan krueger of the council of economic and visors put up, suggesting exactly this. the question becomes, is this related to or is there any implication of changes in income inequality for income ability because those are conceptually different topics.

there are some suggestedthere has been recentas income inequality rises, mobility declines. that may be another implication. i think perhaps the most challenging of all the implications has to do with or political economy, which is where i am going to end. there has been a fundamental change in the congress that has occurred at exactly the same gone up. i do not think these two are unrelated. let me try to illustrate first congress. this chart shows you the red distribution is republicans in the house. the blue is democrats. the key thing i want you to focus on is in the late 1960's, there was a significant amount of overlap. the most liberal republicans and the most conservative democrats were voting together on a significant share of things. the model most of us have an hour had about health policy should be made reflects that. -- we have in our head about policy should be made it reflects that.

the middle is disappearing. starting in the late 1960's towards the late 1980's, it is dwindling. we are effectively two different parties united by a single congress with almost no moderate. especially since melissa is not there anymore. she was that one person sitting there in the middle. with far-reaching consequences. why is this happening? the punditry in what i call this corridor between new york in d.c. -- new york and d.c. suggest is proportionally that ideas gerrymandering. we have carved dick drea -- we a car to districts into spaghetti areas.

this causes a split. most of the political science literature suggests that is a very small part of what has been happening. if you can see that. i thought i had a slight, but i do not. if you can examine what has happened in the house versus the senate. the senate has gone up as much as the house. we have not redistricted st. -- state lines. that raises questions. the question that becomes, if it is not gerrymandering, it is it an inside development phenomena or does it reflect that? if it were gerrymandering, we would know how to fix it. if it is an inside the beltway phenomenon, we know how to fix it. if it is reflecting us much more difficult. there is a heated debate about whether it is inside the beltway or outside. the best evidence says that there are 17 states with senators from different parties in the beltway.

they're representing the same constituents in different ways. members of congress and centers have the flexibility or the operational room to polarize them selves. similarly, when a district splits parties, that a member of congress represents the same constituent in much different ways. if that is what were happening you would expect the majority of people, when asked if they are -- their member of congress is now too extreme, a larger share of them would say yes. that has not happened. if it were an insight development phenomenon, you would expect state legislatures to be polarizing less than the house of representatives. actually, two-thirds of the state legislatures have polarized more. all of which suggests to me a significant component of this is hot. we are becoming more polarized as a people.

the reason for that, i believe is that we are increasingly both virtually and physically surrounding ourselves with like- minded people. one of the most compelling pieces of findings or evidence from social psychology is, if you put like-minded people together, the group becomes more extreme than any given individual when they started. because the people want to prove that that -- that they are the true member of the tribe. you make yourself reenforcing comments. virtually, this is happening to us now because we can choose our own that news sources. we only used to say newspapers. watch the evening news. now, we can select our own reality. my favorite example of that -- i have a twitter account. i do not tweet, but i follow people. about two or three months ago, i noticed that one of the people i was following was saying a lot of things i did not like. mostly because he was criticizing me. [laughter]

i responded by un-following him. i realized he did not exist. i should check to make sure he is still out there saying the same things. he no longer occupied my brain space. that point of view was no longer present in my thought blago. similarly, physically, to a degree that i think it has been under appreciated, we are segregating ourselves by political parties. republicans are moving into their neighborhoods and democrats are doing the same. it is not only news and virtual reality, but our neighbors are increasingly of like-minded perspectives. let me show you a map that demonstrates that. this is a county -- this is county data. one way of measuring whether the county is polarized is to examine whether it goes hard one way or the other in an election.

this is from the mid-'70s. the black or gray areas are landslides for the democratic or republican candidate respectively. there is nothing special about the carder race in 1976. -- jimmy carter race in 1976. the key thing is, look at the best part of a country that is next. it is white. it does not landslide one way or the other. that is the '70s. that is today. applewhite is disappearing. there is retake the white is disappearing. a 30% of the population lives in more polarizing the states. you have to win presidential elections by appealing to those increasingly rare mixed counties. therefore, run to the middle if you will.

i am no longer for that you can actually legislate there because the middle is gone. if that is right and it reflects us, we are going to face a central dilemma in our political economy. you run to the middle of the national election, you cannot legislate there. the only way you can at this point in any meaningful way is by dominating the political system, winning the white house the house, and 60 votes in the senate, and legislating based on one part of that distribution. if you do so in those rare circumstances, you will generate some much backlash that that dominance will then disappear. we will have a significant time of gridlock and divided government. historically, that would not be that damaging because we still have enough overlap that you can legislate despite divided government.

the key changes with the disappearance of moderates -- id is not clear to me that divided government lead to anything other than clear -- gridlock, which can be damaging. i will close with this thought. at about this time next year we are going to face a fiscal trifecta that will make last summer look like child's play. that debt limit -- we will be bumping up against it once again. the tax cut from 2001 and 2003 will have expired or are scheduled to expire in full at the end of this year. at the same time, we have very large scheduled cuts in both the defense and non-defense spending, beyond what anyone believes as possible. they're all happening at the same time. that, historically, would have been a moment, because you have so many things that have to happen for big legislation to occur.

instead of dealing with those rather unpleasant topics might as well put some lipstick on it and go bigger on something. i suspect, however, that if we wind up with a divided government scenario that january, the prospects for that big legislation are much smaller than they should be because of the disappearance of moderates. again, thank you for having me. i am delighted to be here. melissa told me not to end on a bad note. [laughter] let me say three things i think can help alleviate some of these trends. the first is, the evidence is overwhelming that is causing the polarization. it is not being exposed to

alternative points of view. i think we all, as citizens, 0 it to the country to go out of our way -- owe it to the country to expose ourselves to things we would not normally agree with. the second thing that i think corporate leaders, in particular, can do to try to provide some relief on the tectonic plate shift -- i do not want to hold out anything. there are two things i think will help on underlying tectonic plate shifts. i mentioned education. when we mention that we typically talk about the institutions of higher education that are the crown jewels. the fact of the matter is, for most americans, far more important is the role of community colleges. i am particularly encouraged by what chicago is doing to try to unite local employers and local community colleges. would it not be great -- this is

already happening. would it not be great if basically a local employer said, indeed of years, these are the skills we need. kids who are going to diminish the college's new if they did a good job -- going to community colleges knew that if they did a good job, they would get a job. the firms get training and a skilled workforce. of the workers get -- the community college students get higher degrees of alliances that what they are studying is going to matter. that is what chicago is doing. i am going to watch carefully how that turns out because it is exactly the kind of thing that has to happen between the business community and local community colleges across the country. [applause] thank you.

then the final thing has to do with pushing even harder for value in health care. the reason is, most american workers do not realize how much their take-home pay is being reduced by the health care costs that businesses face. if the trajectory on health care costs were improved, take-home pay could rise more as a result. over the next five or 10 years we are on the cusp of a significant resolution possible in health care that involves information technology. it involves changing the way that providers are incentivize. i think united health and other insurers are doing a lot of useful things in moving towards a bundle payment and episodic payment and other methodologies that move away from just paying for each particular service. that whole effort will not

succeed unless the people who are in charge of collecting health plans and providing health care for their workers, that is you, are forcefully behind it. i would urge you to read things and be exposed to things from a different point of view. continue to press what chicago is doing on community colleges and put your weight behind the effort to get more value out of health care because that will ultimately prove beneficial, not only for you, but for our -- for the workers across america. thank you very much. [applause] >> thank you very much for a fascinating speech. we of arctic up some interesting questions. we have about 50 minutes to get through them. -- we already have some interesting questions.

we have about 15 minutes to get through them. how much more will inequality wise, how much longer can the medium work? if you're a's business -- what can we do to face that world? >> i think it depends on what you mean by inequality. i suspect these forces have widened the gap between the 90th percentile and the 50th percentile. on a going forward basis that is not going to continue. the 90th percentile is going to be affected by the forces of globalization and technological change. it has not been as prevalent over the past few decades. inequality will not continue rising there.

it is in the 99.9%. the 90/50 ratio -- what is happening to the college graduate versus someone right in the middle of our earnings distribution. i am not sure it is going to continue. a professor like to ask his students, who do they think will earn more in the next 20 years it qualified plumber or a run- of-the-mill engineer? he has been surprised to hear that often more than half of the students picked the plumber. to the extent that the engineer skills are easier to digitize, that may not be wrong. >> i guess you would interpret that -- make yachts. that is what will be in demand. >> thinks that are delivered in person or that involve non- tradable services involving different -- involve a different dynamic than the triple.

-- the tradable. >> i am one of these people who is affected by digitization. >> there are now data mining software that can do a better job at analysis then what used to be a team of ph.d. economists 10 or 50 years ago. it is not only journalists. [laughter] >> and other thing you mentioned is, the falling labor share of the economy. more is going to capital and less is going to labor. the upside is that profits must be strong. if that continues and there -- how can you get businesses to invest this huge amount of capital they have building up on their balance sheets?

>> let us address that question. i think you are going to see investment -- there has been a fair amount of growth in investment at the short end. the stuff that depreciate rapidly. in the could finance software, that has been growing the past couple of years. -- in equipment and software that has been growing the past couple of years. others have been hunkering down. the fact that ideas have been suggested me that -- the fact that it has happened that suggests that there is macroeconomics uncertainty. of the world is an uncertain place right now. that would make complete sense that if you are being driven by a concern about how the world is going to turn out, you make

shorter-term investments because the cost of doing a longer-term one is larger. >> moving on to the budget issue. if the bush tax cuts on dividends and capital gains expired, the spending to sequester goes into effect. what does that do to the economy? what is your guess of what the outcome will be towards the end of the year? >> all of that will be something like a 4% of gdp fiscal contraction occurring at a time when i doubt the economy will be back on its feet. that would not be good. some deal will have to be done. the challenge i have is, i do not see -- what i was mentioning about the congress. exactly how the deal happens i do not see. until the election and see how that turns out.

no one wants an economy that is still not fully back on its feet to be hit with a fiscal contraction of 5% of gdp. that would be undesirable. >> they will have six weeks or something to do i do? is that possible? >> ice -- i would be willing to bet that in order to get a deal done in a divided government scenario, you are going to need short-term extensions to purchase time for two months, as we have seen the congress to act when it cannot figure out how to resolve things before deadlines. or, we are going to have to go over the cusp and have all of this stuff expire in order to force people together, which would be -- anyway.

this time next year, there will be a lot of trauma one where or another. >> plenty to write about. [laughter] speaking of journalists, in a recent book an article -- it pour -- it portrays your role as the anti-stimulus man. what is your response? >> i am called an especially tragic figure. [laughter] there are a whole variety of traps that one can fall into in terms of missing important distinctions. i have long been the savior of a couple of stimulus approaches. i just mentioned earlier in which you provide more stimulus now, but couple it with a long- term deficit reduction. i think that is the right policy response and the legislative strategy.

the debate describing these articles actually was between that couple stimulus, should we do more stimulus in and couple it with long-term deficit reduction or should we do naked stimulus? somehow, support for couples stimulus is being presented as anti-stimulus, which i do not understand. that treatment is often a sense of missing that very important point. i think coupled stimulus is the only thing that has a chance of making progress with the congress. in addition, you have to remember, this is late 2009, we were coming up against another debt limit increase. the thought you would go out with a stimulus only bill and no long-term deficit reduction at all and then hope to raise the debt limit strike me as fanciful. not even planetary.

>> moving on. i am going to keep throwing the statute. where do you invest your personal wealth? [laughter] >> i am in diversified, low-cost index funds, which are mostly global, but are we to my home country. for no reason i think i can actually justify other then it feels safer. >> ok. [laughter] what are some ways to reduce health-care costs in the u.s.? >> there are basically four did approach to reducing health-care costs. you can reduce prices. reduce how much you pay doctors and hospitals. that is a very blunt and quickly effective tool, but it is only blunt. it is not a long-term solution. for example, if all you did was

to ratchet down prices in medicare and did not address the underlying quantity of services provided, you would create access problems for medicare beneficiaries incentives to costs. if you cannot just bludgeon this through prices and have a long- term solution. that leads as to where the great debate is. it is a fault debate. how do you get a quantity of service provided? one approach -- these are presented as mutually exclusive. one approach is the consumer approach. people often do not have that much skin in the game. if they had more cautionary, they would be better consumers of health care. that can help. at the evidence from experiments the united health has done suggests there is a benefit in terms of reducing costs.

the problem is, it is not as big as you think. most of the consumer driven approach is to provide very -- third-party insurance. most health-care costs are in a high-cost cases. for example, you take medicare and you rankin by costs, the top 25% account for 80% of the cost. that brings us to the other category, which could work in concert with more cost sharing. this is focusing on provider value. in those high-cost cases, why is it that some providers deliver health care in this way and others deliver it in that way? that involves changing the information flow in terms of health information technology and the technological incentives. there are a whole series of

changes. one thing that has not been remarked upon is, over the past couple of years, there has been a huge deceleration in health- care costs, both in this -- both in the commercial space and medicare. it is not just a blip on the screen. it has been going on for a few years. ideas have been disproportionately to medicare as it goes to the commercial space. -- it has been disproportionately medicare as it goes to the commercial space. i ask what has happened to medicare revenue. when i asked, i t was only up 2% year to date, which is dramatically lower than in the past. pulpsif you ask for the reason, the reason is the number of orientation -- the number of hospitalizations have been flat. the number of readmission people who are discharged -- 20% are readmitted within 30 days.

that has gone way down because they have put in a screen. if you look like you were at high risk, they put a team of doctors on you and it is working. if you want to know what is wrong with the financial incentives in our health-care system, that program is working. no one would voluntarily want to be readmitted to the hospital. the person who runs the hospital cannot afford to continue it because the doctors and nurses are expensive. more importantly, the hospital loses the revenue on it. there you go. >> see what i mean about him being good on health care? this is the last question, i am afraid. the eurozone debt crisis -- how is it affecting the u.s.? how concerned or do that it can

do us harm? >> -- how concerned are you that it can do us harm? >> 25% of exports go to europe. exports are still a modest share of overall u.s. economic activity. when you put those two things together, the direct impact are not massive. at second linkage is if financial contagion in the european banking system infected the u.s. financial system that looks increasingly less likely. the european central bank has stepped in forcefully to backstop the financial institutions, at least by providing three-year liquidity to them. also, because u.s. financial institutions have had enough time and are trying vigorously to insulate themselves as much as possible from that channel. your left with the third one which is the hardest to calibrate. it involves underlying

uncertainty. there is hit to export. risk from in direct linkages through the financial system. more generally, we do not know exactly how this will turn out. i spent a lot of my time talking to ceos and you hear a lot of that. the macro uncertainty is causing you to pull back a little bit. one of the principal components of that uncertainty involves the european debt crisis. >> thank you very much. please be kind to us on your blue papers. [laughter] [applause] >> thank you. [captioning

objection. mr. camp: i yield myself such time as i may consume. the speaker pro tempore: the gentleman is recognized for such time as he may consume. mr. camp: i come to the floor today in strong support of this nference report. as a result of a lot of long hours, hard work, and determination on both sides of the aisle and both sides of the capitol, this agreement shows the american people that congress can govern and washington can work. first and foremost, this legislation prevents a tax increase on 160 million american as a conservative, i look at the agreement and see somvery big wins. chief among them are the most significant reforms to the federal unemployment program since it was created in the 1930's. all designated to promote re-employment and paychecks instead of unemployment a benefit checks. while extending unemployment benefits through the end of the year, this agreement creates a

national jobs search standard for the first time. covering benefits from beginning to end and requires every unemploy american to look for a job if they receive unemployment benefits. the agreement allows states to spend unemployment funds on paying people to work instead of just sending them a check while they are out of work. it ensures taxpayer funds are properly spend by -- spent by permitting drug testing under commonsense rules that help people get ready for a job. it expands work sharing programs to help avoid layoffs in the first place, and it improves fiscal responsibility but not only recovering more overpayments which currently total a staggering $12 billion per year, but also by making sure that this program is fully paid for. the last item something i want to focus on for a moment. all government spending in this agreement is fully paid for and not with one dime of higher taxes. all spending object un-- on unemployment and health care are fully paid for. this is a significant victory

for those of us concerned about the national debt. and the culture of deficit spending that has gripped washing for far too long. for example the unemployment program has added nearly $200 billion to our nation's debt over the last four years. no more. we paidor it in december, we are paying for it today, and we set a clear precedent that the congress must live within its means, no more spending unless it's paid for, period. i understand this is a comprose. and not everyone likes everything in here. if i had my way, the bill passed the house in december would be the law. that was the only bill that extended these programs through the end of the year. it was the only bill that was fully paid for. and it was the only bill that ensured seniors and their doctors were protect interested dramatic cuts for at least two years. but we don't control washington. democrats still control washington. they control the senate and they control the white house. utilizing a process that dates back to our founding fathers, house republicans have scored significant victories in this

conference committee. our founding fathers recognize that washington would not always be united. in their wisdom they knew even divided government must still govern. and that's what we are doing here today. governing and providing a solution to the very real problems americans are facing in their daily lives. i urge my colleagues on both sides of the aisle to join me in supporting thi legislation which pays for new spending with spending cuts, prevents working americans from getting hit with a tax increase next month, reforms our unemployment programs, and ensures seniors continue to have access to their doctors. i reserve the balance of my time. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from michigan. mr. levin: i yield such time as i shall consume. the speaker pro tempore: the gentleman is recognized for such time he may consume. mr. levin: the basic fact is that this legislation is vy different from the december house republican bill, very different. and any efforts to mask that are false.

and that house bill was the main bill before the conference committee. the basic fact is theonference committee made major changes to the house bill that passed in december essentially on a partisan basis. and therefore this legislation is much better for the american people. the speaker said this about this bill, let's be honest, this is an economic relief package not a bill that's going to grow the economy and create jobs. that's not an honest statement. it's wrong. this is a bill that relates to the economic growth of the united states of america. we are recovering. and this bill will provide a boost to continue that recovery.

it continues the 2% payroll tax through the calendar year. and it is not offset as was true of the house republican bill in december. it had massive harmful cuts that would have been counter cyclical and would have undermined further economic growth. so in that respect this is very very different. it's also very different in terms of unemployment insurance. let's be clear about that. the bill that the republicans passed through the house that was the main bill before the conference committee would have slashed 40 weeks of unemployment insurance for millions of americans in every state regardless of the unemployment rate in that state.

and this bill essentially changes what was in the house bill. it extends unemployment insurance through the rest of the year up to, this is the maximum, up to 89 of 99 weeks through may, up to 79 weeks through august and up to 73 weeks through december, depending on the level of unemployment. let me just say our chairman has talked abou job search and now a requirement of people be looking for work. that's already in the law of every state. that isn't a meaningful reform. in terms of job search, everybody not only registers but also, as i said, is requiring to look for work.

and you know, i find it an insult to the unemployed of this country to say essentially what we're simply giving them a check instead of a paycheck. you know if you talk to the unemployed through no fault of their own, they are looking for work. they had a paycheck, in most cases, year after year after year. they work for their unemployment insurance, and to simply label this an effort to get people off of unemployment insurance, unemployment insurance is not a welfare program. people work for it and they needhat assistance as they look for work. the bill that passed through th house had a g.e.d. requirement. that's out. to say tpeople, you don't get

a check if you're not in a g.e.d. program when there are 160000 people in this country who are on waiting lists for education, that's out of here becausit deserved to be out of here. and in ter of the drug programs, the effort to test people for drugs it is so limited so it is really masking the reality to call this major reform. it freezes in terms of the reimbursement for physicians through december. and let me just close by saying a few words about the limits on this bill because there are limits. it would have been much better to treat unemployment insurance as an emergency as we have for 20 years. this is the highestevel of

long-term unemployed on record in this country, which is another reason not to blame the unemployed for their unemployment as the house bill in december did and some of the rhetoric on this floor continues to do. we were not able to obtain this and i want to say this in terms of a precedent. in my judgment, it should not serve as a precedent. the precedent is 20 years treating it as an emergency, and let me also say it's deeply unfortunate that some on the other side insisted that federal workers carry a disproportionate share in the cost of this bill. even if there were put forward bipartisan pay-fors that would have cost -- covered the cost of u.i. in a bill that was brought in a

bipartisan basis, there would have been an impact on federal employees of $67 billion. this bill has a provision that will apply to pension programs $15 billion over 10 years, compared to the $67 billion that was in the bill that the house republicans passed. so let me just say in closing, this argument provides tax relief to working familie, a framework is in place for the year for the unemployed workers, and a real commitment -- and i emphasize this -- but -- by us democrats to pursue efforts to strengthen the economy and boost job growth so that those hardest hit by the recession can return to work as they desperately want to. and i just want to reiterate

how wrong the speaker was when he said, let's be honest, this is an economic relief package, not a bill that's going to grow the economy and create jobs. the opposite is true. the provisions in this bill will help to continue economic growth. the payroll tax, most economists say that. unemployment insurance, people spend it, and that is not only good for their subcystens but good for the economy of our country. for all those reasons i urge support of this conference committee, and i reserve the balance of my time. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from maryland. mr. hoyer: madam speaker, i yield myself five minutes. the speaker pro tempore: the gentleman is recognizefor five minutes. mr. hoyer: thank you madam

speaker. i've taken the unusual process of claiming time in opposition to this bill. i have done so so i could place in context the bill we are considering. i do not rise to necessarily defeat this bill. i'm going to vote against this bill. i am for almost all of this bill. what we are funding this bill with was unnecessary unfair and ought to be rejected. i want to say at the outset that my friend mr. camp, and i had a very positive discussion. i believe that mr. camp and i could have reached an agreement which would have put me in support of this legislation. we didn't get there. we tried late in the game and we didn't get there. i regret that. i think mr. camp tried. i know that everybody on my side would have supported the agreement that mr. van hollen and i put forward. that agreement would, as the

current agreement would say that the only individls paying for this bill out of 315 million americans are the two million civilian workers who work for us, who wo for all of us, who day after day, week after week, month after month make sure we give the services to the people of the united states, protect the united states, ensure that our food is safe, ensure that we have amphibious agents on the job, -- make sure we have f.b.i. agents on the job, these are all civilian employees. highlyskilled. highly trained. highly educated and, yes highly motivated. and every day they give outstanding service to the people of the united states. we talk here and we pass laws

here but none of those -- none of that talk and none of those laws makes a difference unless somebody implements what we say and the policies that we set. this congress is on the path to be the most anti-federal worker congress that i have served in. and i'm going to place that in context for you which is why i wanted the time. first of all, what is the context we find ourselves in? first of all we have a very struggling economy. the good news is the economy is coming back but not fast enough. we need to create more jobs, expand opportunities and make sure that the american dream is alive for all workg americans. working americans like our federal employees, working americans like the folks at g.m. who have done just very well, working americans who work in the hardre store, the

grocery store, the gasoline station, hardworking americans. and we don't have enough jobs for them. as a result we have high unemployment, and i congratulate my friend mr. levin, for his leadership in making sure that the unemployment provision in this bill is sufficient to try to reach those folks and make sure they don't fall off the ledge. we walked away from them in december. i'm glad we are not walki away from them today. now, we also have, as all of us know, a struggling economy an therefore we put into effect giving $1,000 more to each and every worker. now, many of your leaders did not support this 2% reduction, and i understand that. i won't go into their names. some are in the chamber, but the fact of the matter is it

puts $1,000 of additional pockets into average working americans' pockets. people paying fica. that is people making less than $6,000. that is an important thing to do for us to keep this economy growing. i'm for that. i was for it in december. i'm for it in february. i'm glad we are going to have consensus on that today. but what i am not for -- let me go on because in addition to that, we are playing a silly little game. with the doctors and with medicare pients, and this silly little games pretends we are going to extend s.g.r. for 10 months. that's balo nmbs ey and everybody knows it -- baloney and everybody knows it. we are going to extend s.g.r. over and over and over again. we should have done it

permanently in this bill. we should have done it permanently in the congress which i was the majority leader. we should have done that. i yield myself two additional minutes. the speaker pro tempore: the gentleman is recognized for two minutes. mr. hoyer: so with respect to s.g.r. ladies and gentlemen, we are playing a game and the doctors all over this country and the medicare recipients all ov this country know we're playing a game. we're giving them no certainty, no confidence that come this september, october november, we won't have another one of these silly little debates. now, we also in the context have a deep deficit and debt that confronts this nation that we have to deal with, and we had two commissions that said we had to deal with it. one was bowles-simpson. my friend, mr. becerra sat on that my friend who sits in the chamber. the other was domenici and rivlin and we had others, including the gang of six in the united states senate, an all of them had a premise that we needed to deal with the

fiscal problem that confronts us and the other premise was all of us need to contribute to that solution. all of us. now, what do we see that's being proposedin this congress , partially in this bill but only partially in this bill? we have eitr on the floor proposed on passed over the last two years -- listen to this ladies and gentlemen -- we are about to cut or propose to cut $134 billion out of our federal employees over the next 10 years. nobody else in this bill, not a millionaire, not a billionaire, not a carried interest beneficiary, not an oil company, nobody in this bill other than federal employees is asked to pay. i understand we have hospital cuts. by the way, we have5 billion

to that because we just increased by one year the cut that they know they got. the same for some other things. no individual other than a federal employee's asked to take a cut in this bill. now, you will say to me, no, it's future federal employees. two more minutes. the speaker pro tempore: the gentleman is recognized for two mites. mr. hoyer: you say it's future federal employees so it doesn't matter. that's $15 billion of the $134 billion that's been proposed. they've already paid $60 billion $60 billion, and by the way, your side of the aisle is not going to give them that half percent the president asked for so that will be an additional $30 billion. so in three years, mr. and mrs. america, madam speaker $90 billion in contribution to help bring this deficit down, federal employees are paying. and by the way, federal

employees is a percentage of our population are down by a third over the last 20 years. it's not that the bureaucracy is growing. yes, our population is growing. we're trying to serve the down by a third in numbers. now, i know something about federal employee pay. i represent about 60,000 federal employees. you say hoyer is up there defending his people. you'd be right. you'd be very right. . but most of the federal employees don't live in the washington metropolitan area. they live in your districts all over this country, serving your farmers. serving your drug stores. serving everything that you do. do i think it's the private sector that makes this country great? absolutely. do i believe they need an energized high morale, highly

educated federal work force as their partner i do. and you will not have that ladies and gentlemen, if we keep along this path of every time we come to a bill that's a little bit of trouble the pay for is to reach in the federal employees' pockets. they pretty much are going to say i'm not with you any longer. i want to tell you in terms of recruiting and retaining you will not do . 40% of the federal work force, ladies and gentlemen, can retire in the next five years. one more minute. the speaker pro tempore: the gentleman is recognized for an additional mine. mr. hoyer: ladies and gentlemen, you are going to be able to recruit those folks only if you have a competitive work force. let me give you a figure that you might find interesting. there are 33,000 -- 33,300 employees at goldman sachs.

average salary, ladies and gentlemen, $367,057. average calorie. -- salary. of 33,300 people. you won't be able to compete. you won't be able to get n.s.a. employees asopposed to semans or microsoft or some of those other corporation, many of which are in ms. eshoo's distri, you won't be able to recruit them and retain them to have the best and brightest defending america and making america the strongest and greatest country on earth. you want america to be an exceptional country, you better best have the best civil service on earth? . as well as the best private sector. one more minute. ladies and gentlemen, i don't know whether most of you know this i saw the gentleman from florida who has been here for a couple months pontificate i

didn't know anything outside the beltway. i was the sponsor of the federa employee pay comparability act. and george bush the first signed that october. we worked with his o.m.b. to get it. what does it say? federal employees cannot get a raise unless the private sector gets a raise. we are precluded from getti a raise unless the private sector gets a raise. what does it further say? that the private sector which is the economic cost index, by the way, in case you want to know exactly what the statistic is says we are going to take a half a point less. so what have you done? in this bill. unnecessarily. because you are going to freeze their salary for the third year in a row. andimpson-bowles said do it for three. but they said everybody ought to share. we only get $1 trillion in revenues. $1 trillion in cuts. everybody. one more minute, but nobody but

federal employees. nobody. is targeted in this bill other than federal employees. you can tell i'm angry about th because that's not fair. and that's not how you want to treat our employees, america's employees. america's public servants we call them. we ought to stop dissing them. we ought to stop demagoguing them. we ought to stop using bureaucrat as an epithet. america needs them. i'll have some other things to say in a few minutes, madam speaker. but we ought not to walk away from our federal employees any more than we ought to walk away from those 160 million people who need this tax cut or walk away from those 2.4 million who need that unemployment

insurance. or walkaway as we have from the doctors who need certainty, long-term, not for 10onths, but long term. i reserve the balance of my time. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from michigan. mr. camp: thank you. before i yield i just would like to say to the gentleman that he did characterize our conversations correctly. it was very late. i do look forward to working with him in the future on these issues as we move forward. with that i would yield two minutes to the distinguished gentleman from oregon, a conferee mr. walden. the speaker pro tempore: the gentleman from oregon is recognized for two minutes. mr. walden: thank you, madam speaker. thank you, mr. camp. i want to thank my colleague from michigan for his extraordinary leadship in pulling the house and senate together as chairman of our conference. one of the key elements of this piece of legislation is freeing up enormous swath of spectrum for use in the -- to grow jobs in technology and innovation, generate $15 billion to the

treasury to help pay for some of the things that are being discussed today to extend the middle class tax cut, to provide unemployment for those who are seeking work, and in the process here there are estimates of building up the 4-g network which will take spectrum like that that will be made available here could generate between 300,000 and 70000 american jobs and unleash technology and innovation in america. in addition to doing that, the republican house in concert with our colleagues across the aisle and chambers have come together to finally take care of you are public safety officials who on that terrible day in september of 2011 discovered their devices did not communicate well with each other, if at all. so finally we have come together to create an interoperable public safety broadband network they can operate on wherever they are wherever disaster may strike, and they'll be able to

mmunicate with each other. we have allocated money to build it out. i think we have put governance structure in place that while it's not exactly what i hoped would happen i think it can function. we will see. so we have built out a public safety network for our public safety officials. that will get under way. this bill will help generate 300,000 top00,000 american jobs, generate $15 billion private sector money coming into the government to help pay for some of this and protect our over-the-air broadcasters. our tv broadcasters who will be asking in a voluntary auction if they want to give up a spectrum are protected so the viewers out there and-k still see and watch their over-the-air public -- public and private broadcasters. madam speaker, this is good legislation. and i hope you'll support it. the speaker pro tempore: gentleman from michigan. mr. levin: i now yield to a member of the conference committee, mr. waxman, and the ranking member on energy and

commerce, two minutes. the speaker pro tempore: the gentleman from california is recognized for two minutes. mr. waxman: madam speaker, with two minutes i'd like to ask unanimous consent that i be able to revise and extend my remarks and insert extraneous material. the speaker pro tempore: without objection. mr. waxman: with those remarks. i'll vote for this bill but i do so with reservations. we should have done better in meeting our responsibilities to the american people. there are important provisions in this legislation that will do a lot of good for families and our economy. we are extending the payroll tax reduction for millions of families, extending unemployment insurance, ensuring the doctors serving seniors will be paying for their services through the end of the year. and we are making spectrum available for new innovations in wireless communications. while these are provisions i support, in the conference report there are significant missed opportunities and poor choices that affect federal workers and preventive health programs.

nowhere is this lost opportunity more apparent than our failure to end the medicare physician payment formula known as the s.g.r., and set us on a path to a fair and reasonable physician reimbursement system. having to settle for another temporary solution which leases at the end of the year even deeper in the hole in terms of a permanent solution it's a real failure and one that fails medicare beneficiaries and doctors alike, and i did not agree with the cuts in reimbursement for hospitals and nursing homes and unbelievably in prevention services in order to pay for the physician reimbursement levels at a reasonable amount. i am he deeply -- i'm deeply concerned about the federal employees' provision i think that is very unfair. i do not have similar reservations about the spectrum provisions in the conference report. our bipartisan, bicameral negotiations resulted in legislation that will make new spectrum available for broadband

services, will create a nationwide band ever spectrum that can be used for innovative, unlicensed applications, and will provide for the construction of an interoperable brdband network for first responders. taken as a hole, i -- whole, i believe we should support this package even with its serious shortcomings. yield back my time. the speaker pro tempore: the gentleman from maryland. who seeks recognition? the gentleman from maryland. mr. hoyer: madam speaker, i now yield to mr. van hollen, the ranking member of the budget committee, distinguished gentleman from maryland. the speaker pro tempore: the gentleman from maryland is recognized for 2 1/2 minutes. mr. van hollen: thank you, madam speaker. i thank my colleague, mr. hoyer.

this bill accomplishes three very important objectives. it extends the payroll tax cut for 160 million americans. it extends unemployment insurance to millions of americans who are out of work through no fault of their own, and it supports the medicare program. so i am not here on the floor today to urge my colleagues to vote against this bill. in fact i'm confident that it will pass. the bill's also significant for what it will not do. unlike the original republican house bi, which cut compensation for current federal employees by about $40 billion this bill does not cut compensation for any current federal employee. not one cent. let me repeat that. i'm pleased that senator cardin and i and other members of the conference committee were successful in holding harmless ourardworking current federal employees. that being said, i'm going to vote no to send a message that

enough is enough when it comes to using the federal work force as a piggy bank to fund our various national initiatives. here's why. while no current employees are impacted by this bill, it does cut compensation for future employees hired starting in january, 2013. and that will, as mr. hoyer said, it will make it much more difficult for uso attract the federal employees we need to do our national work together as part of our federal servi. and indeed, one half, a full half of the 10-month extension for unemployment insurance that benefits the entire country $15 billion, is financed by cutting compensation for future federal employees. that is a disproportionate share from the federal work force. the federal work force has already contributed over $88 billion to our deficit reduction for the denial of two colas and

the proposed cola cut this year and the republican transportation bill would cut another $42 billion from federal employees to finance our national highways. that's a ridiculous approach. federal employees, as mr. hoyer said, are willing to do their fair share to help reduce our deficit, but stop singling them out and making -- singling them out and making them scapegoats. they had nothing to do with the meltdown on wall street and i'm sick and tired of hearing some members of congress badmouthing anbelittling federal employees. if i could have an additional 30 seconds, please. mr. hoyer: 30 seconds. mr. van hollen: they are an easy political target for some, as mr. hoyer said. but it is irresponsible to denigrate their good work. these are the men and women who care for our veterans and many of our wounded soldiers. these are the people in our intelligence community who helped track down osama bin laden. these are the folks at n.i.h. and elsewhere who help find

treatments and cures that help prevent diseases that plague every american family. they are the folks who protect our borders. they are the folks that help run the medicare and social security system. they are the folks in the capitol hill police that protect this great cter of democracy right here. so while this conference report does many good things, we need to send a message it's time to stop scapegoating federal employees and using them as the piggy bank for our national objectives. the speaker pro tempore: the gentleman's time has expired. the gentleman from michigan. mr. camp: i yield two minutes to a mber of the conference committee, the gentlewoman from north carolina. the speaker pro tempore: the gentlewoman from north carolina is recognized for two >> thank you madam speaker. i ask unanimous consent to address the house for two minutes and revise and extend my remarks. the speaker pro tempore: without objection. mrs. ellmers: yesterday afternoon i happyly signed the conference report that was -- happily signed the conference report that was very, very well put together, and i commend chairman camp for the hard work that he did and my fellow

conferees. this joint conference committee came together. was tasked to negotiate the payroll tax holiday extension, and this is a very important break through and shows that we can actually work together and compromise for the sake of the american people. i would like to thank again chairman camp and my fellow conferees once again for the honor and privege to serve on this committee. our report does what is necessary to provide a responsible level of certainty to job creators and ensure that millions of hardworking americans will be protected. . in this obama economy, it's important that american taxpayers keep more of their money and use it to make ends meet. gas prices are projected to go up above $4 a gallon, madam speaker, by the summer. if thisuts a little more

money in individuals' pockets so they can pay for half a tank of gas or a quarter of a tank of gas then i say i'm all for it. furthermore, this deal strikes the most dramatic blow to obamacare yet, keeping a promise i made when i first came to washington. with this agreement we are cutting spending by more than $5billion and using a portion of these savings tpay for the doc fix. what is the doc fix? the doc fix ensures millions of medicare patients our seniors to receive that medical care. it will prevent the 24.7% cut for physicians for medicare services. we must now retu to the focus of the most pressing issue facing our nation which is job creation and fixing this economy. the speaker pro tempore: jeaths. mrs. ellmers: may i have

another 30 seconds. mr. camp: i yield another 30 seconds. the speaker pro tempore: the gentlelady is recognized for another 30 seconds. mrs. ellmers: the obama submitted another bloate budget that ignores the economic crisis we are living under the obama economy. it's time to roll up or sleeves and get to work and remove these barriers to prosperity and focus on the one thing that matters most, job creation, and continue to provide certainty to millions of americans who are looking to us to make concise decisions about their future and the future of their children. thank you, madam speaker. the speaker pro tempore: the gentlelady's time has expired. just as a reminder the time remaining is the gentleman from michigan, mr. camp has 11 3/4 minutes. mr. levin from michigan has 10 minutes remaining. and mr. hoyer of maryland has five. the gentleman from michigan. mr. levin: it's now my pleasure to yield one minute tour distinguished leader, ms.

pelosi from the great state of california. the speaker pro tempore: the gentlewoman is recognized for one minute. ms. pelosi: i thank the gentleman for yielding and for hised a vow cass on -- advocacy on behalf of the thriving middle class of america and make sure we would have this payroll tax cut as well as the extension of unemployment insurance. he fought so hard on thats well as on the making sure that our seniors are able to see their doctors under medicare. congratulations and thank you, mr. levin. i rise today madam speaker, in support of this legislation. of course, i identify with the concerns expressed by our distinguished whip, mr. hoyer, and . van hoen, regarding our public employees. before i talk directly about what is in the bill i do want to say that for our country to thrive and for us to do our very best, we must have areat

relationship between the public and the private sector. the private seor is the driving engine of job creation in our country, but it cannot succeed unless we also have an effective and thriving public sector. it's about so many things that we lates to our public safety, -- relates to our public safety the courts, the implementation of laws passed in congress, it doesn't exist unless the public sector then implements. so this is a relationship that's existed from the beginning of time in our country and it's not a zero-some game. we can't say we are going to do this in the private sector at the expense of the public sector so i salute them for their psistent leadership and recognizing the important role that the public sector pays. it was not necessary for us to go down the path that has been taken in this bill, and i'll get to that in a moment.

i just want to say this represents a victory for the middle class in our country. i appreciate president obama taking this message to the american people, that it was very important for us to have a payroll tax cut for the middle class. it's important to those families because it puts $40 more into a paycheck to buy groceries, to buy gasoline, to make ends meet, to make ends meet, but it was additional being personal to families, it had a macroeconomic effect because these families will spend that money, inject demand in the economy and that is a job creator. any economist will tell you that this is very important to continuing the economic recovery in our country, to have rejected it, as had been in the mix earlier, would have halted if not turned back our economic recovery.

so let us recognize that one of -- we have three pillars that we insisted be in this package. onhe democratic side. one, that we would have a payroll tax cut for 160 mlion americans. what is unfortunate is we did not use our choice of a pay-for, should it be paid for, the surcharge to covered the unemployment insance. that would have been a preferab place to go. the undiplomat extension -- the extension of unemployment insurance. it could have also been used to pay for the s.g.r., the ability for seniors to see their doctors instead of taking money out of the prevention piece of the affordable care act. prevention is -- makes america healthier, it saves money, it expands opportunity for people to get in the health care loop. that's unfortunate. and it could have been avoid

as well as the unfortunate provision relating to our public employees. and even on that score mr. hoyer said mr. van hollen did there was a further compromise that could have been made that addressed some of the needs of the republicans to vote for this bill without doing mo harm to the -- as mr. hoyer said, the recruitment, the retention of public employees the best public employees to help implement our laws and i want to salute all of them for their patriotic duty to our country, to keep us safe in every possible way, to allow commerce to proceed in a very positive way. but now let's get back to why this is important, this victory for the middle class. this was a fit.

why should it have been a fight? there's something out there in the public the ground troops the common sense coming up from the ground that this was an important thing to do, and the american people overwhelmingly supported it. there's a ground truth out there from the public, common sense coming up from the ground that in order for us to do -- meet our needs and also reduce the deficit that we should have a surcharge on the wealthiest people in our country. people making over $1 million a year. not having $1 million. making over $1 million a year. that was not contained in this bill, but it will be part of the debate as we go forward. so let's take a moment to say that we recognize here on this floor of the house the importance of a thriving middle class to our democracy, to our

democracy, and that this action taken toda is an portant step but we have much more work to do. democrats are committed to reigniting the american dream, to building ladders of opportunity for all who want to work hard, play by the rules, take responsibility, but we have work to do. in this thrivi -- this -- reigniting the american dream, it's about recognizing the role of entrepreneurialism in our system small businesses, what they do to grow our economy and how we have a public-private relationship there to encourage small business and, again, all of this relates to a thriving middle class. so i urge my colleagues to be ever vigilant about every opportunity we can take to support the middle class. today is a good day in tha regard. it's just one piece of it, though.

we have much more work to do. and every bill that comes up, there are things you may not like in it and you say well, i'm not going to vote for it for that reason. on balance i come down in fav of supporting what the president asked us to do which we did do what the american people want us to do but i don't want to go forward without registering the concern that we could have done better in this. and one place we can start on our next legislation is to look at the surcharge for the wealthiest people in america instead of taking billions of dollars from preventive care so that we can offset the costs in here. none of it needed to be offset. unemployment insurance has not traditionally been paid for. we didn't have to do it now. in fact, paying for it diminishes some of its stimulative effects. as economists will tell you,

unemployment benefits are paid out, spent back in the treasury as will the payroll tax cut, it will stimulate the economy by injecting demand and creating more jobs. s.g.r. we should have gone all the way with it. we should have done it permanently. we could have paid for it with our war savings or with the surcharge at the high end. the republans said no. having said all of that, having said all of that, the fact that we are here today is an admission and -- that this is the right thing to do in terms of t payroll tax cut and unemployment compensation and our seniors a recognition that the american people are watching and they have little appetite for us to be fighting over what they know is the right thing to do which is to take every action we can to grow our economy, focusg on

the middle class, small business sburel spirit -- entrepreneurial spirit and the rest reignite the american dream in an even bigger way. with that, madam speaker, i urge our colleagues to support the legislation, and i yield back the balance of my time. the speaker pro tempore: the gentleman from maryland. mr. hoyer: madam speaker, i yield 1 1/2 minutes to the gentleman from virginia, mr. connolly. the speaker pro tempore: the gentleman from virginia is recognized for 1 1/2 minutes. mr. connolly: i thank my colleague. i support the d fix in this bill. i support the payroll tax cut extension in this bill. i support the extension of unemployment insurance to so many of our fellow americans who suffered in the great recession. sadly, i cannot, however, bring myself to vote for this bill. i represent the third largest number of federal employees in the united states, and they're asking a simple question -- what is the nexus, what is the relationship between their employment and these worthy

subjects? and the answer is none. three times this week the republican majority has attempted to get axed benefits and pay and compensation of the federal work force and often it's from misinformation. a bloated work force. we entered data in a hearing record the other day that shows the obama administration in absolute ter has 350,000 fewer federal workers than those that served during the administration of president h.w. bush and as a ratio to 1,000 population in amica, it's the lowest since john kennedy was in the white house, in 50 years. they have already given $90 billion to debt reduction through pay freezes and future pay freezes. and to whack at this pensions affecting both current and

future employees in the pending transportation legislation that i hope will die of its own weight. it is not fair to ask only one group of americans to make a sacrifice shared sacrifice should mean shared sacrifice. i yield back. the speaker pro tempore: the gentleman from michigan. mr. camp: i yield two minutes -- i yield two minutes to a member of the house conference committee, the gentlewoman from new york. the speaker pro tempore: the gentlewoman from new york is recognized for two minutes. >> this conference report that we bring to our colleagues for a vote today representsa remarkable good faith fert by the members of a committee who combined, who rked together, democrats an republicans, house and senate, to act responsibly for the american people and in response to what the american people have asked us to do. ms. hayworth: as a physician and i practed in the hudson

valley in new york, the importance of extending reimbursement insurance for our seniors who rely on medicare, for the doctors who care for them, who have to keep their doors open, is a crucial issue. but not only did we provide that assurance through the end of this year, we also provided for some other crucial provisions for our rural hospitals, for our ambulance services for a number of other aspects of care that rely on our action and on the responsible action that we take today. and, yes, we did pay for those extensions in a responsible way , as we must, in a time of looming fiscal cris. . we have a debt that extends to $50,000, roughly, per man, woman, and child in this country. it is unconscionable for us to

fa to acknowledge that responsibility and for all of us to do our part in that way. we have, yes, asked our federal employees to help us because as the employer, the federal government has to take its responsible steps as well. and the hope that all of us have is that we will continue to work through this year. we will move from here with this consensus document and continue to work on the growth that our economy desperately needs and do so together, by controlling what the deral government does. and i thank you, madampeaker. i yield back. mr. levin: i now yield two minutes to another conferee the gentleman from california, mr. becerra. the speaker pro tempore: the gentleman from california is recognized for two minutes. mr. becerra: i thank the gentleman for yielding. in december thicongress gave 20 conferees three tasks a

cheeve by february 29. to extend the payroll tax cut for 160 million middle class americans. to ensure americans whoost their jobs through no fault of their own received their unemployment insurance benefits. and to guarantee our seniors on medicare have access to the doctors of their choice and the care they need. we achieved this goal. but let's be clear. this agreement is by no means free of controversy. the gentleman from maryland, mr. hoyer, eloquently illustrated that. our republican colleagues succeeded in extrabblingting a pound of flesh from -- extracting a pound of flesh from middle class working americans who also serve ably in the federal government. what was the alternate that we faced -- alternative that we faced? a house republican bill passed in december that quadrupled the cuts to workers in their salaries and benefits, that increased the cost of medicare for millions of seniors, that eliminated and restricted access to physical, speech, and occupational therapy in hospital settings for medicare patients, that eliminated the child tax

credit for millions of modest income families. that eliminated unemployment insurance benefi for nearly three million americans who have lost their jobs through no fault of their own. this agrment represents a rejection of the approach in the house republican bill of deceer. it is a compromise, free of the controversial and extraneous measures in that republican bill in december. but it is a bill of controversy. because we are asking american workers who work very hard who give their all and just happen to work for e federal government to pay the cost of helping other americans who are unemployed. we could have made this a good bill. we could have asked every american, especially those most able to contribute, to help out. we didn't in this bill and that's why it's a compromise. it could have been much better. but we face the deadline by february 29 for 160 million american families. would have seen their taxes

increase. we would have seen a situation where millions of americans would have lost their unemployment insurance and we needed to act as we did. i urge my colleagues to vote for this compromise measure. the speaker pro tempore: the gentleman from maryland. mr. hoyer: i yield a minute and a half to the distinguished ranking member of the government reform committee mr. elijah cummings from maryland. the speaker pro tempore: the gentleman from maryland is recognized for a minute and a half. mr. cummings: i'm very pleased we are extending the payroll tax cut through the end of the year which is essential to support our continued economic recovery. i'm also pleased we are providing unemployment benefits to ensure the millions of americans have access to benefits they so urgently need and that we are implementing the doc fix to ensure that seniors who are on medicare can continue to see the physicians of their choice. that said, there are a number of provisions in this agreement that deeply disappoint me. for example, this agreement will reduce by 30 weeks the maximum number of weeks of unemployment insurance available to residents

of states with average unemployment rates, while the unemployment picture is certainly improving in january with the creation of 243,000 jobs, and a reduction in the unemployment rate of 8.3%, there's still 12.8 million people unemployed in this nation and millions more who are part-time but want full-time work. for millions of fellow citizens unemployment benefits are truly a lifeline. i'm also deeply disappointed that the conference report requires new federal workers who contributed more to their pensions. our federal employees are not a piggy bank. we should not reach into their pockets any time we need to pay for something. federal workers are the backbone our government. in return for their hard work and dedication, the majority has been re-- has rewarded federal rkers with an unprecedented amount of criticism, assault on their compensation, and benefits including proposals to extend their current two-year

pay freeze and arbitrarily cut the number of federal employees. and now -- the speaker pro tempore: the gentleman's time has eired. mr. cummings: m going to vote against this conference report. it's an important bill to get through, but i have to vote against it in the name of my employees. the speaker pro tempore: the gentleman from michigan. mr. camp: i yield 2 1/2 minutes to t chairman of the energy and commerce committee and a member of the house senate-house conference the gentleman from michigan. the speaker pro tempore: the gentleman from michigan is recognized for 2 1/2 minutes. mrupton: i thank the gentleman from the great state of michigan for yielding. i rise obviously in support of this conference report. it's not perfect but it is srnl the right thing to do now. -- certainly the right thing to do now. our economy is still struggling bigtime. families are struggling in my home state of michigan, we know better than anyone else the pain of high unemployment and anemic economic growth. in extending the temporary payroll tax relief and unemployment benefits, it's not the way to fix the economy, but we nd to do it now to offer a

measure of relief to those in need. but our long-term goal is certainly much bigger. we got to fix the economy. we got to create jobs. we need to return america to a place whe these temporary patches are not needed. in addition to the payroll tax and unemployment health extensions, this package includes the doc fix threw the end of the year to protect seen -- through the end of the year to protect seniors to prevent physician reimbursement rates from being slashed by nearly 30%. again it is but a temporary solution to a long-term problem. and as chairman of the energy and commerce committee i'm absolutely committed to working with my good friend, chairman camp, to develop a permanent solution to the medicare physician payment system. one that protects seniors and their doctors in the long-term while also protecting taxpayers and making sure that medicare is efficient, effective and sustainable. these temporary solutions are a big part of the package, but

madam speaker, it would be a terrible mistake to ignore another part of the package. one that will help support literally hundreds of thousands of jobs, one that will spur billions of dollars of investment in our economy and affect the daily lives of nearly every american. i'm talking about spectrum reform. spectrum, it's the airwaves that carried wireless communications. spectrum is all around us and we sure do use it. with the explosion in smart phones tablets, mobile broadband devices, americans are using more spectrum than ever before. this bill helps our country make more efficient use of those airwaves. we are clearing large swaths of spectrum from innovative wireless investments and the upshot is that wireless companies will pay the taxpayers billions of dollars for the right to build the next generation of wireless networks. it's a huge win for consumers and taxpayers. this package is the culmination of years of effort, bipartisan effort, numerous hearings,

extensive stakeholder input, cooperations on both sides the aisle, and i want to recognize my good friend and chairman of the communications and telecommunication -- the speaker pro tempore: the gentleman is recognized -- >> both greg walled ron and -- walden and anna eshoo to push this bill through the finish line. no qualified bidder can be excluded from the auction. were it not giving away airwaves that the taxpayers paid to clear. these are good solid reforms with clear congressional intent and i appreciate the hard work to get an agreement and advance this wireless future. i think all my colleagues on the conference committee. we worked together. we got it done, and the taxpayers are going to be better off. i yield back the balance of my time. the speaker pro tempore: the gentleman's time has expired. the gentleman from michigan. mr. levin: i now yield two minutes to another hardworking member of the conference committee, ms. schwartz from the state of pennsylvania. the speaker pro tempore: the gentlelady from pennsylvania is recognized for two minutes. ms. schwartz: thank you.

this conference committee was charged with resolving differences between the house and senate so we could extend middle class tax cuts, protect seniors, access to their doctors, and extend unemployment benefits for americans looking for work. as a member of the conference committee i'm pleased we found a compromise to meet these goals and we are able to provide stability for millions of americans. action today means 160 million american taxpayers will be able to keep more of their hard-earned dollars. these are middle class families ruggling to pay their mortgages, food built, childcare cost and college tuition. this tax cut will better enable them to meet their obligations and contribute to growing the economy. it means that 13 million of our hardest working americans will receive unemployment benefits and be better able to provide for their families. there are encouraging measures of economic growth in our country, but recovery is still frile. we had 23 consecutive months of private sector job growth, unemployment numbers are down.

yet millions of americans are still looking for work. action today better ensures that losing a job will not mean economic disaster for families who have worked hard and played by the rules. action today will mean we will keep our promise to 47 million seniors by preventing a drastic 27% cut to physicians who care for medicare beneficiaries. this is a win for american seniors. but it does not relieve us of our responsibility to permanently repeal the s.g.r. and replace it with a new payment system. for over a decade this failed policy has created uncertainty and instability for patients, for health care providers, and the federal budget. throughout this process i advocated for both permanent fiscally responsible repeal of the failed medicare policy, and a path forward to new payment models to improve quality whi reducing costs. despite bipartisan support for this approach, long-term agreement could not be preached. i will continue to work with my colleagues on both sides of the

aisle to end this perennial threat to the promise of medicare oncend for all. i urge support for american families and seniors and millions of americs still searching for a job. i ge support for this conference report. the speaker pro tempore: the gentleman from maryland. mr. hoyer: i yield one minute to the gentleman from virginia, mr. moran. the speaker pro tempore: the gentleman from virginia is recognized for one minute. mr. moran: thank you madam speaker. i thank my good friend from maryland. i appreciate the work of the conferees. but i oppose this conference agreement not out of concern for the welfare of the tens of thousands of federal employees that i represent, but out of concern for the welfare of the great nation we serve. we are blessed with the least corrupt, most effective least discriminatory, most responsive federal work force in the world. and yet how do we repay them?

we are requiring them to increase their pension contributions by 400% with no increa in benefits. so we are sending them a signal. so i will really appreciate what you are doing. you are expendable. it's a signal that will not be lost on the recruits that we desperately need inhe few -- future. let alone the hundreds of thousands of federal employees who could easily be making much more in the private sector. the whole country's going to pay a price for the signal that this bill sends. and that's why i think we should defeat it. thank you, mr. chairman. the speaker pro tempore: the gentleman from michigan. mr. camp: i reserve. the speaker pro tempore: the gentleman reserves his time. the gentleman from michigan. mr. levin: i now yield one minute to the distinguished representative from california, ms. eshoo. the speaker pro tempore: the gentlelady is recognized for one minute. ms. eshoo: i thank the gentleman.