that in fact medical malpractice is an insurance issue and even when there is an attempt to in essence dumb down the recovery, we have seen that the insurance companies do not in essence reward the physicians. insurance premiums are still high, high, high, high, high. how do i know? you can go to the state of texas and ask physicians, are there insurance premiums -- are their insurance premiums such that they're celebrating today? yes, there were some measured declines, but they're paying high insurance premiums. . now, in the finding of h.r. 5, our friends cite the commerce clause and indicate that congress has the right to write this bill on health care because of the commerce clause. as i understand it, many are

pursuing the challenge of the affordable care act, suggesting we had no authority. but in their own bill, the findings cite interstate commerce as a basis for writing this bill. but, there are some friends over there that just caught it and one of the amendments from another gentleman from georgia strikes the finding. this is the have your cake and eat it, too, because they know that tort law has for long time been the prerogative of states. and so to cite president reagan when he gave this talk on tort law in 1986, his words, over the years, tort law has help us drive the negligent out of the

marketplace. this has permitted innovatives to take its course. the president agrees that tort law drives the negligence out of the arena. he then goes on to say, to be sure as he put together this task force, many tort law would need to be reformed, and he says, in our federal system of government, this is only right. and so my friends cannot deny that h.r. 5 implodes state law. it takes away the authority of states. and this removing it by some late amendment is not going to make it right. you are going to violate the rights of colorado, florida, illinois, maryland, michigan, texas and west virginia that have enacted their own medical malpractice act. you are going to i am employed connecticut, iowa and in this

bill, if you have not limited it, then you are capped. in this bill, you rid the rights of those states that have not capped. and the flexibility only comes if you have capped and it is higher than what we have, and you obliterate constitutional state law that has its own caps. so this is not as black and white as my good friends would like to make it. we are riding in on the high horse and we are not. for example, in my state of texas, connie expire -- spears, went to ap hospital complaining of leg pain and this was due to a previous blood clot. the doctor discharged her with bilateral leg pain and what happened is she had blood clots

and got kidney failure and went unconscious and two legs were amputated. there was definitive negligence and it is important to note that she sits today with no legs. what we are suggesting is we are intruding into state law that this individual now under federal law loses noneconomic damages for pain and suffering and the extent of the negligence that was promoted, and as well, faces a federal hard hat to prevent her from having relief. now this is in the state of texas and we have tort law reform that many oppose, but it is a state decision. i offered an amendment that would have carved out an exemption for lawsuits.

congressman hank johnson and mr. quigley, exempted victims of malpractice, including limbs and loss of reproductive ability. this was not accepted. what we say today is people like connie spears, children, seniors who are limited in their noneconomic damages now have no basis for punishing those who were blatant in their negligence, no way of dealing in a punitive manner to prevent these kinds of acts from happening and recognizing the loss of limbs of someone who may have been unemployed. my friends cannot have it both ways. that is challenging the affordable care act because they say that the interstate commerce does not allow us to do good,

but yet coming back in their findings to suggest they have the upper hand. well, i'm going to join my friend on the other side of the aisle, mr. johnson, on states' rights. today on h.r. 5, you literally quash and extinguish states' rights. and in the course of doing so, you quash the rights of injured patients for those that ronald reagan said, to get negligence out of the marketplace, out of the care of those who need care so that the good can rise up. so i make the argument that we're now debating in a conflicted manner. i don't know what the positions of republicans are. they want to get rid of the affordable care act which was premised on the interstate commerce clause. they come back on our two-year

anniversary celebrating people who are living because of the affordable care act and now want to place their hat on doing this on interstate commerce. i want to know where all the states' rights advocates are and why you are abolishing and eliminating constitutional state law while you are eliminating statutory law where individual states have expressed their will. i believe this bill, along with the component that wants to dash the affordable care act, is a bill destinned for the president's veto, but more importantly, but let me try to understand how we can have our good friends on the other side of the aisle, their cake and eat it, too. i'm celebrating with the cake of the affordable care act. i don't mind celebrating in this congress' right to help save

lives. how do you put a bill on the floor of the house, where you have argued that there is no right for us to be involved in health care. now you want to dash the rights of those who have been injured through interstate commerce and the congress of the united states of america. frankly, the complexity of your argument is such that it makes no sense and frankly, i hope that my colleagues will join me and applaud the affordable care act, and celebrate life we have provided, expanded life, and also recognize that those individuals who seek remedy in the marketplace who have been injured by negligence and acts that have been -- be compensated and that is all we ask under the constitution and due process

rights for all americans. i yield back. the chair: the gentleman from texas. mr. smith: i yield two minutes to the gentleman from georgia, mr. gingrey. mr. gingrey: mr. chairman, i appreciate chairman smith yielding to me and with a great hesitation do i rise, because the gentlewoman who just spoke was raided the most eloquent, if not one of the most eloquent members of this body. but even though she's eloquent, i, with all due respect, i think she's wrong. and in regard to the issue of the commerce clause and the issue of the affordable care act and sometimes referred to -- successful, it will be his legacy, obamacare -- this bill, mr. chairman, was created by

forcing individuals to engage in commerce, that is to purchase health insurance under the penalty, or a tax, i'm not sure from how, day-to-day, they are going to describe it. but without question, that is not constitutional. and i expect, maybe four to five decision in the supreme court, but maybe nine, zero, because it is unconstitutional and not applicable to force people to engage in commerce. the constitution says to regulate interstate commerce. and, of course, that is very much applicable in h.r. 5. and the medical liability reform act, because when you have a situation in health care where

there is no provision for certain medical specialties in a high-risk area like gynecology, cardiovascular surgery, where babies have to be delivered beside the road -- mr. smith: i yield the gentleman an additional two minutes. mr. gingrey: clearly, the gentlelady from texas -- and i think she knows this -- texas has enacted tort reform. they have caps that are different, in fact, than originally existed in california 35 years ago. and the result in texas, if all of my colleagues from texas on this side of the aisle are truthful with me is that the problem in texas is stabilized. physicians are coming back to texas. there is no shortage of

specialists because of the law that was passed in texas. and i want to point out to the gentlewoman, too,, that in this bill, there is a provision that is called flexycaps that says whatever a state does preempreempts federal law as well as contingency fees for plaintiffs' attorneys. state law prevails if they address that before this bill is passed or after the bill is passed. so i just say -- and i will yield momentarily, but the gentlelady is eloquent, but wrong on this issue. and i will yield to her. ms. jackson lee: thank you for your kindness and kind words, rather than being wrong, we disagree. if you do not have a cap, then this bill will supersede in

states that have no caps. and the only thing i would conclude on is that the premise of your bill, even though you are citing the individual mandate, and we can quarrel about that as to whether or not it is a force-upon mandate, employer-based insurance, et cetera, but it is premised on interstate commerce and therefore you have an amendment being offered by one of your members to strike that because -- mr. gingrey: mr. chairman, i yield back. mr. conyers: i yield the gentlelady an additional minute. ms. jackson lee: i thank the distinguished gentleman. the premise of this bill is interstate commerce of which in the initial arguments being made by my friends on the other side of the aisle, they argued

vigorously that we couldn't even do health care under this premise even though we have medicare. the premise you have in this bill is under interstate commerce, but you have an amendment that is seeking to strike your findings because you were caught with a conflict between dealing with this question congresses neal -- congressally, and you are trying to use it now, but you realize that there are members who are now arguing the question of states' rights. we have existing state law on tort reform hundreds of years of tort reform, and you're trying to abolish it with this added legislation on medical malpractice. you're now trying to supersede state existing -- mr. conyers: i yield the gentlelady another minute.

ms. jackson lee: and where the amounts of monies are not capped, where there are no caps, this bill places the $250,000 in if there are no caps. that is a overriding of state law, no matter how you cut it. it's an overriding of state laws and you can't have your cake and eat it, too. i'm willing to celebrate the affordable care act and eat the cake, but what you are doing is overriding state law. and i thank the gentleman for his courtesy. the chair: the gentleman from texas is recognized. .

one of seven physicians would have had a malpractice claim over their entire lifetime. today it's one in seven are sued each year. that's an astronomical jump in the number of claim beings put on doctors. and the doctors are now being forced out of the profession even when they haven't done anything wrong. the practice of defensive medicine is harming the quality

of care and pushing up costs and the enormous expense of ensure -- insuring a doctor against liability is making health care inflation much worse. not to mention the fact that the current system is damaging the doctor-patient relationship. it damageses it because every doctor has to see every interaction with a patient as a potential lawsuit. that is not what the doctor-patient relationship should be built on. it should be built on mutual respect and trust. and until we have something that actually addresses the medical malpractice problems that we have and we get the reforms that are much needed, that actual relationship's never going to improve. so i urge the house to pass the path act. because it will do two vital things to get health care costs understand control. first, it would eliminate obamacare's independent payment advisory board and thereby keep a board of unelected,

unaccountable bureaucrats from restricting senior access to health care. it also brings medical malpractice lawsuits under control by capping noneconomic damages and limiting attorneys fees so more money will actually go to the victims rather than overzealous trial lawyers. these reforms will save taxpayers over $40 billion over the next decade. everyone knows that we need to do something about rising health care costs and this bill and taking care of the medical malpractice problems that we have will go a long way in getting those costs under control. this bill will give every member of this house the opportunity to be part of this solution and i urge my colleagues to vote yes on h.r. 5 and i yield back. the chair: the gentleman yields back the balance of his time. the gentleman from michigan is recognized. mr. conyers: thank you, mr. speaker. i yield to a senior member of the judiciary committee, maxine waters of california, as much

time as she may consume. water water -- the chair: the gentlewoman is recognized for as much time as she may consume. ms. waters: thank you very much, mr. conyers, former chair of the judiciary committee, ranking member. and the gentleman who hases a provided superb leadership in opposition to h.r. 5. mr. speaker, i rise in strong opposition to h.r. 5, poorly titled, protecting assets to health care, so-called path act, and un--en unconstitutional big-government bill that violates the soth amendment and states' rights. at the start of the 112th congress, my colleagues on the opposite side of the aisle declared that all business conducted in the house would be consistent with the constitution . yet if you read the constitutional authority statement attached to h.r. 5, the republican sponsors seem to believe the commerce clause

magically creates a path for congress to mandate nationwide caps on punitive damages in all medical malpractice lawsuits. the republicans are telling all americans no matter how severe the injury or egregious the mistake by the doctor, hospital or drug manufacturer, that their losses are going to be capped at $250,000. and with all due respect to the gentleman from georgia, representative gingrey, who introduced h.r. 5, even his own state supreme court has found caps on punitive damages to be unconstitutional. in 2010 the georgia supreme court unanimously struck down limits on jury awards and medical malpractice cases. the georgia court determined that $350,000 cap on noneconomic damages violates the right to a

jury trial as guaranteed under the georgia constitution. section 110-a of h.r. 5 would impose an even lower cap on damages in georgia, effectively overturning the court's decision by an act of congress. the section reads, the provisions governing health care lawsuits set forth from this act preempt subject to subsections 5-b and c, preempts state law to the extent that state law prevent the application of any provisions of law established by or under this act. in addition to georgia, other states like arizona, pennsylvania, wyoming and kentucky whose state constitutions specifically prohibit damage limitations will have their constitutionals overruled by congress -- constitutions overruled by

congress. for members who have for years now questioned the constitutionality of the affordable care act, you need but take a look at h.r. 5. h.r. 5 goes far beyond anything passed by the democratic majority. if you don't believe me, just listen to tea party founder phillips in slamming h.r. 5. he wrote, whether you think tort reform is a good idea or not, it is an issue that belongs to the states and not to the federal government. tort law has always been governed by the states. now, i didn't say that. mr. conyers didn't say that. ms. jackson lee didn't say that. none of those who have been over here this evening opposing h.r. 5 and laying out the facts and

the consequences of h.r. 5 said this. let me repeat. i am quoting tea party nation founder phillips. whether you think tort reform is a good idea or not, he said, it is an issue that belongs to the states, not to the federal government. tort law has always been governed by the states. even some of my republican colleagues on the judiciary committee have expressed concerns. congressman poe, republican from texas, said, i believe that each individual state should allow the people of that state to decide, not the federal government. if the people of a particular state don't want liability caps, that's their prerogative under the 10th amendment. well, let's listen to what congressman gohmert, republican of texas, said. he said, the right of states for self-determination is enshrined

in the 10th amendment. i am receipt sent to support congress imposing its will on the states by dictating new state law. to my conservative colleagues in this chamber, don't be tricked. don't be fooled. h.r. 5 simply, clearly put, violates state he ises' rights. reject this -- states' rights. reject this unconstitutional piece of legislation, protect states' constitutional rights and vote no on h.r. 5. let me just wrap this up by saying, the gentleman from georgia referred over and over again, constantly this evening, about frivolous californians and we talked about these jurors who didn't take into consideration conscious juries who didn't take into consideration the facts on these negligence cases. but rather looked at the insurance and said, oh, just

give them whatever. they didn't care. well, i came to defend california and to tell you the difference between what happened in tort reform in california and what you have been told by the gentleman from georgia. supporters of h.r. 5 claim that it's the same as micra, a medical malpractice liability law, h.r. 5 is far different. the differences are clear. h.r. 5 applies damage caps in all health care lawsuitings, including cases against drug companies, nursing homes, insurance companies and h.m.o.'s. micra only applies to malpractice cases against a doctor or a hospital. punitive damages are reserved for only the most egregious medical malpractice, they're meant to deter future dangerous

conduct. h.r. 5 limits punitive damages, mmcra does not cap punitive damages. h.r. 5 gives total immunity from punitive damages to drug and device manufacturers if their products have been approved by the f.d.a. or generally recognized as safe and effective. mmcra does not provide this kind of sweeping immunity for the drug industry. h.r. 5 caps noneconomic damages at $250,000 in the aggregate, no matter how many parties have been damaged by medical malpractice, even when an injury results in loss of a relationship. california law recognizes a separate claim for loss of consortium, claims brought by the spouse of an injured patient. mmcra does not limit these claims. joint and several liability which my leader asked you about,

mr. gingrey, enabled as an individual to bring one claim against any of the parties involved in a medical malpractice injury and ensures that injured victims are fully comment say thed. h.r. 5 completely eliminates joint liability for both economic and noneconomic losses. california law only limits joint liability for noneconomic damages. h.r. 5, neither law can deliver a lower medical malpractice insurance premiums. h.r. 5 includes unprecedented legal protections for the insurance industry but no guarantee that any future savings will be passed on to doctors or patients. following the passage of mmcra, insurance premiumser to doctors increased in california by 450% over the next 13 years. premiums that only decreased after california enacted proposition 103, a ballot

initiative that mandated a 20% rollback in premium rates. i was in the california legislature when that happened. h.r. 5 does not guarantee lower premium rates for doctors. in fact, the bill only mentions insurance companies when giving them protection from liability. so, again, i say, donets be fooled, don't be tricked. i don't really mean to imply, mr. gingrey, that you were trying to fool or trick anybody. but you are simply wrong. we have given our opposition in more ways than one this evening to h.r. 5, but since you alluded to or talked about or pointed directly to california and all of these people who simply have frivolous lawsuits and these poor jurors who sit and don't take into consideration the facts and simply look at how much insurance is available and

just award these tremendous amounts, i had to add to my testimony this evening a defense and an explanation and so the difference between mmcra and h.r. 5 and i think i have done that and i think i have done that with the facts that exist and i am very pleased that i have been able to join with my colleagues this evening to not only reveal what h.r. 5 is and is not, but i think we've made the case and i think that we have put the facts forward in such a way that we're going to win on this issue. i ask you to oppose h.r. 5. the chair: the gentlelady yields back the balance of her time. the gentleman from texas is recognized. smith schmidt mr. chairman, i'll yield -- mr. smith: mr. chairman, i'll yield to the gentleman from georgia, dr. gingrey. the chair: the gentleman is recognized for as much time as

he may consume. mr. gingrey: i thank chairman smith for yielding to me. as good a communicator as the gentlewoman from california is, i would be quick to state that she's not the great communicator . the great communicator of course , president ronald reagan. and the gentlewoman from california talked about comments that were made on my side of the aisle, members of the judiciary committee and named a couple of members on my side of the aisle that were concerned about federalism and the 10th amendment and states' rights, but i just want to remind her that at least from our perspective, the gentlewoman may not agree with this at all, but from our perspective on this side of the aisle the great communicator was president ronald reagan. . in a speech of 1986 to the

u.s. chamber of commerce after a commission had reported to him on this issue of medical liability reform and the need for same, the president very clearly outlined almost the identical provisions that are part of micra that was passed in his state that he governed for eight years, the great state of california. so, again, the gentlelady makes her points well, but quite honestly, i think there is a bit of he embellishment on their side of the aisle. who do you trust? the gentleman from arizona, mr. quayle, spoke moments ago, mr. chairman, about who do we trust. well, what above you, first of

all, in god we trust, in mom and dad, we trust. and dr. bailey, augusta, georgia, we trust. in uncle, we trust. by that's way down the line. way down the line. i think our colleagues on the other side of the aisle think that big government should control everything, that they should make the decisions. and that's where obamacare came from. and to do it, they had to proffer a 2,800-paged bill that is clearly unconstitutional. h.r. 5 is not unconstitutional. you look at article 1, section 8, clause 3, the commerce clause, and clearly, it's constitutional, requiring someone, forcing someone to engage in commerce, indeed, to purchase health insurance is unconstitutional, and that will

be determined by the supreme coordinate. with that, mr. chairman, i yield back. the chair: the gentleman yields back the balance of his time. the gentleman from michigan is recognized. mr. conyers: mr. speaker, we have no further requests for time. and with the agreement of the chairman of the committee, i would like to close at this point. mr. smith: mr. chairman, we have no other speakers as well and i'm prepared to close as well. the chair: the gentleman from michigan is recognized. mr. conyers: i would like to thank all of the members on both sides of the aisle that have participated in this important debate. there has been a lot of clarity, even though there has been a great difference until opinion. i return the balance of our time

with this thought in mind, that even though the author of this bill is a well regarded medical practitioner and who is a distinguished member of the body , he is a doctor, but he is not a lawyer, and i think that -- and i commend him on the fact that he agreed with this statement that, to me, determines a lot of people's point of jew about this very -- point of view about this very controversial bill that is now

before the floor, h.r. 5. that is and he agreed and answered in the affirmative that h.r. 5 eliminates joint and several liability for both economic, noneconomic and punitive damages. and to me, with all of the cases that have been of human suffering, of injury to women and children, of how long it would be to limit all of these kinds of damages to $250,000 in

this 21st century is an insult to common sense and fair play. >> would the gentleman yield? mr. conyers: with pleasure. mr. gingrey: clarification needs to be made. you are suggesting that what i said there would be a limitation of $250,000 because of the elimination of joint and several liability. that is not true at all. whatever the judgment is, the $250,000 in noneconomic, the $10 million in economic, would be a portion of the defendants in proportion to their liability. that's what the elimination of joint and several liability means. eliminating this deep-pocket mentality of plaintiff's attorney. mr. conyers: well, i accept your comments.

i accept through the speaker, i accept the comments from the gentleman from georgia and i assume his response to my question earlier is still yes. and if that is the case, then all i can say is that i think there are very few people in the federal legislature or among our citizenry that would say that there should not be an unlimited amount of recovery. the gentleman must have some feeling for the fact that $250,000 for the rest of the

person's life, if they lose arms or legs, eyes, it's just -- it's just unacceptable. i won't say that it's immoral, but it's unfair. and it's my hope that most of our colleagues as we continue this debate will realize that that is the fatal flaw in a bill that may have some justification in other parts of it. but that limitation of damages cannot be rationalized nor

justified by the collective body of this legislature. and for that reason, sir, i'm urging all of our colleagues to consider this one point that i make tonight as i close as to be controlling in their decision that they will make as we vote tomorrow on this bill. and i thank all of the members that have joined in this debate this evening. and mr. speaker, i return the balance of my time. the chair: the gentleman's time has expired. the gentleman from texas is recognized. mr. smith: i yield myself the balance of my time. i want to re-emphasize under this bill, awards are possible that far exceed the $250,000 cap

in noneconomic damages and that's because under the economic damages provision, there is simply no cap and as a result of that, states like california and texas, which have adopted reforms similar to the reforms in this particular piece of legislation, there have been numerous rewards of multi million dollars awarded to individuals who have been injured. so even though we we had that 250,000 noneconomic cap, that is not an absolute cap on the awards made. dr. gingrey mentioned in california several years ago, 2007, there was a $96 million award. and in the last year for which we have records in 2010, there were awards for over $6 million, $10 million, so an individual is able to be reimbursed for the costs that that individual may

have incurred. i also want to say that america's liability system increases the cost of health care and decreases access to health care as doctors abandon their practices out of fear being sued. medical liability reform, this bill tonight, will solve this problem. according to the journal of american college of surgeons, five years after tort legislation passed in my home state, number of physicians increased by 24%. that is twice the rate of growth in population over the same period of time. other states have seen similar results. but most states have not enacted meaningful reforms and as a result, frivolous lawsuits have created a crisis. and have forced women to drive great distances to deliver babies. and has resulted in those who

need complicated procedures being placed on a waiting list for months because the only available specialists has too many patients and has caused accident victims to lose their lives because the local emergency room no longer has a trauma center. america's broken medical liability system has caused patients to lose access to high quality health services. the liability reforms contained in the health contact will do these things, will lead to a significant savings in health care expenses, reduce the practice of defensive medicine, halt the departure of doctors from high litigation states, improve access to health care and increase the affordability of health insurance. also according to the congressional budget office, this legislation will reduce the federal deficit by more than $45 billion over the next 10 years.

this is a significant savings in a time of escalating deficits and debt. we have seen the positive effects that similar medical liability reforms have had at the state level. reforms in states like california and texas have enhanced patient care, reduced doctor shortages and decreased costs. it's time for congress to enact these reforms for the benefit of all americans. and mr. chairman, before i yield back, i would like to thank the gentleman from georgia, dr. gingrey who has spoke so many times tonight for introducing this piece of legislation that is going to help so many people across america. with that, i yield back the balance of my time. the chair: the gentleman yields back the balance of his time. and all time for general debate has expired. for what purpose does the gentleman from texas rise?

mr. smith: i move that the committee of the whole now rise. the chair: the question on the motion that the committee rise. those in favor say aye. those opposed, no. the ayes have it. the motion is adopted, and accordingly, the committee rises. the speaker pro tempore: tpwhrspirm. -- mr. chairman. the chair: we report that the committee has come to no resolution thereon. the speaker pro tempore: the chairman of the committee of the whole house has had under consideration h.r. 5 and has come to no resolution thereon.

are there requests for one-minute speeches? the chair lays before the house the following personal requests. the clerk: leaves of absence requested for mr. bachus of alabama for today and the ballance of the week and mr. davis of illinois for today and thursday, march 22. the chair: without objection, the requests are -- speaker the speaker pro tempore: without objection, the requests are granted. the speaker pro tempore: mr. pallone is recognized as the designee of the minority leader. . . mr. pallone: i'm here to talk about the affordable care act. some calm it the health care

reform. this friday will be the second anniversary of the stt pat's signing of affordable care act or health care reform. and i'd like to talk how -- talk a little bit about how it's helping so many people, with patient protections and added benefits, whether we're -- whether you're talking about seniors or young people or women or just the general public. the main thing that is haraleded, if you will, by the affordable care act, is the opportunity over the next few years to expand health insurance to so many americans who do not have health insurance now. we estimate the varyiansy between 40, maybe 45 million americans that simply have no health insurance and what that means is they either don't go to a doctor or they don't get any kind of health care unless they get very sick and end up going to the emergency room. and the consequences of that is that they take no preventive care, they end up in the emergency room, oftentimes they can't afford to pay the cost of the emergency room and that cost

simply gets passed on to the hospital or ultimately to everyone else who is paying for health insurance. so basically what the affordable care act does over the next few years is try to expand insurance coverage to something like 98%, 99% of all americans. taking up those 45 million people and for the most part making sure that they have health insurance. it does that in two basic ways. first of all, expands medicaid which is the health insurance program for people below a certain income, about 15 million americans who have no health insurance now would be eligible for medicaid under the affordable care act over the next few years, when it kicks in. in addition to that, for the rest of the americans who have no health insurance, most of them are people that either don't get it on their job, they're not eligible or they're not offered health insurance by their employer, or they may be individuals who are employed on their own or at home or not

employed in some capacity. they have a very hard time buying a health insurance policy on what we call the individual market. so what the affordable care act does is it sets up exchanges in every state or throughout the country where you can get a very good package for a reasonable price, a very low cost price, and at the same time it provides a subsidy through tax credits to many americans depending upon their income. we estimate if you're, for a family of four making up to $70,000 or $80,000 a year would be eligible for some sort of subsidy or tax credit that would make their health insurance policy more affordable. so essentially what we do is between expansion of medicaid and the subsidies, if you will, and the low cost insurance that's offered now on these exchanges around the country, most people would end up with health insurance. now, what i wanted to talk about today are some of the benefits, if you will, that have already kicked in for various groups of

people. particularly seniors. i wanted to start with seniors. because many seniors, as you know, because they're on a fixed income, have a hard time making ends meet. oftentimes, you know, they can't afford their rent, they can't afford food and for them to take extra money out of possibility to pay for health care -- pocket to pay for health care costs are oftentimes difficult and they have to make choices between heat or food as opposed to health care. one of the things that i really want to stress today, because i listened in the last few nights, because of the anniversary of the affordable care act coming up on friday, i've heard some of my colleagues on the republican side of the aisle actually suggest that somehow the affordable care act was going to negatively impact medicare. nothing could be further from the truth. in fact, the affordable care act expands benefits for seniors under medicare and many -- in

many significant ways but it's particularly interesting that i hear that from the other side of the aisle, from the republican side of the aisle this week, because on tuesday the republicans unveiled their budget for the next fiscal year. and once again, as they did last year, last year's budget, the republican budget this year essentially gets rid of medicare. or what i would say ends traditional medicare. so it's kind of strange to hear the republicans talk about medicare and the affordable care act since the affordable care act actually expands benefits for seniors under medicare, whereas they unveiled their budget this week that actually abolishes for all practical purposes medicare as we know it. what the republican budget does once again is say to seniors, well, we're going to give you a voucher, we're going to give you a certain amount of money through a voucher if you will and you can take that and go out and buy private insurance instead of getting the guaranteed benefit under medicare that seniors now have.

the problem with a voucher is that it's a fixed amount of money and it's not all clear that seniors can buy health insurance with the voucher. but even if they could, because it's a fixed amount of money and it doesn't increase significantly over the years, what you'll find with that voucher is that more and more seniors would have to pay out of pocket either to purchase the insurance because of voucher's not enough, or because they probably can't get a decent package equivalent to the medicare guarantee and therefore would have to pay out of pocket for certain costs that are not covered by the health care plan that they purchase with the voucher. so, it's sort of ironic to hear the republicans talk about the affordable care act and suggest that affordable care act should be repealed because of its impact on medicare when in fact they're doing their best under the budget to basically end medicare as we know it. now, let me talk a little bit about some of the benefits. i want to talk about how the

affordable care act helps seniors and then a little bit about how it helps women and then a little bit about how it helps young people. of course it helps everybody by simply expanding health care coverage for those who don't have health insurance. but the benefits in particular i want to talk about and start with with seniors. i mentioned before that no group has been hit harder by soaring health care costs than seniors. with the economy struggling over the last several years, seniors have suffered even more as they've watched many of their pensions and investments dwindle, making the cost of addressing their health care needs even more challenging. now, as a result of the affordable care act, some of the financial burdens plaguing seniors trying to manage their health care needs have been alleviated. for example, all medicare beneficiaries have access to preentive care and services without any co-pay, co-insurance or deductible. many times you will find that seniors won't even access health care because of the co-pay which is about 20% in most cases.

so now services like annual wellness visits, cholesterol and other cardiovascular screenings, mammograms, cervical cancer screenings, prostate cancer screensings, are completely free of charge to seniors. no co-pay. i stress that. no co-pay. fact of the matter is that the affordable care act expands benefits for seniors, makes it so seniors pay less, ok? more than 32.5 million seniors nationwide have received one or more free preventive services. 2.3 million seniors have already received a free annual wellness visit to their doctor which again is a critical step in preventing more serious illness because if the senior citizen goes for the annual checkup or has some of these preventive services flee of charge, then that avoys them having to get sicker, ending up in a nursing home or hospital. the most important thing, though, in terms of expansion of benefits under the affordable care act for seniors is the colleaguing -- closing of the

medicare part d doughnut hole. seniors on the average before the affordable care act would run out of their part d benefits on the average by september of the year. now, if they spent more than $2,500 approximately on drugs, they wouldn't get any help under medicare part d until they got to a higher catastrophic level of $5,000. so that was the doughnut hole. that gap, when they weren't getting any money to help pay for the prescription drugs. what the affordable care act does is it closes the medicare part d doughnut hole and provides the 50% discount on brand name drugs,.3.6 million seniors have already received the dug count, saving billions of dollars with each senior saving an average of $604. by 2020, that donor hole is -- doughnut hole is closed completely. it will gradually close to the point where by 020 when all their drugs are -- 2020 when all

their drugs are covered and the doughnut hole seizes to exist. i also -- ceases to exist. it also also cracked down on fraud in medicare. in fiscal year 2011 a joint antimedicare fraud task force of the health and human services department, department of justice, recovered more than $4.1 billion in fraudulent medicare payments on behalf of taxpayers. a lot of times they hear, my senior citizens will say to me, there's a lot of fraud in medicare. there is. but the affordable care act has significantly cracked down on a lot of that fraud. 4 -- $4.1 billion in fiscal year 2011. now, you know, i say this, i mentioned this again by way of contrast. here we are in the affordable care act expanding benefits, making it so seniors donets have to pay more and what do the republicans do with their budget? they have a budget that basically says, we'll give you a voucher, you go out and buy your health insurance. if you can't afford it, you have

to pay the difference and i guarantee -- the basic guarantee of medicare and a good benefit package simply won't be there and seniors will just end up paying more out of pocket. now, i wanted to talk a little bit about how the affordable care act levels the field for women's health care. because we know that traditionally in health care there's been a huge gender gap. a report issues this week -- issued this week from the national women's law center shows that more than 90% of the best selling health plans still charge women more than men for the same coverage, just because women use more health services. the health care law -- the affordable care act will prohibit this discriminatory practice which we call gender rating beginning in 2014. so that when the affordable care act fully kicks in, this gender gap will simply disappear. you might say to yourself, well, how's that possible? it's mainly because insurers have considered millions of women as having what we call

pre-existing conditions. in other words they were denied coverage or they were charged more for having had breast cancer, cesarean section child birth, having eith even been pregnant. some policies would charge women more because they were pregnant or considered that a pre-existing condition. or for being victims of domestic abuse, for example. so, denying women insurance on these grounds is unconscionable and thanks to the affordable care act, beginning in 2014 women will no longer be denied coverage for -- by any insurers based on these pre-existing conditions and they can't be charged more because of the pre-existing conditions. now, we've seen again by contrast, what have the republicans been doing? they say, repeal the affordable care act, which would let these pre-existing conditions and this gender gap continue. but beyond that over the last year or so, we have seen the republicans see essentially declare war on women and i just want to give you an example. one of the ones that's received the most attention lately are

these attempts by the republicans to block access to contraception. i don't know how far they're going to go in terms of denying women coverage but that's one of the things that we've seen in the headlines for the last few months or so. but let me give you some other exarms under the affordable care act -- examples under the affordable care act. insurance companies are now prohibited from acquiring women to obtain a referral for access to ob-gyn care. health care reform also requires insurance plans to cover important preventive services including critical immunizations, numerous health screenings and counseling services with no cash cost sharing by women. women in new private plans under the affordable care act may provide free coverage of important life-saving preventive services but the other thing that would often happen is that many health insurance plans have what they call lifetime dollar limits on health benefits. so that if a woman, this would

be true for anyone if they have that lifetime dollar limit in it, but oftentimes it was applied to women in particular that if you spent a certain amount of money on your health care over your lifetime, that was it. you didn't get any more coverage. under your plan. so that is also prohibitive under the affordable care act. now, i just mentioned those few things that apply to women because there really continues to exist a gender gap but that will be closed and eliminated under the affordable care act when it completely kicks in. now, the last group i wanted to mention just because i've always felt that many times in congress we don't pay a lot of attention to kids and i felt that it's very important for us to recognize the fact that policies and the practices and the laws don't necessarily help children and children are very vulnerable. it's like, you know, the seniors are vulnerable, the children are vulnerable. one of the things that's significant about the affordable care act that really makes a difference for children in terms

of keeping them healthy and also keeping them ensured -- insured, and a lot of times americans have to make choices with regard to their kids, about, you know, whether or not they're going to have health care services because of the prohibitive costs of insuring children. now, under the old system, before the affordable care act, sick children were often denied health coverage if their parents were forced to change insurance because they either switched or lost their jobs. insurance companies declined or dropped coverage for children and when young adults got sick or had an accident. that's not -- no longer the case. under the affordable care act basically there's a prohibition on insurers denying insurance to children under age 19 for having a pre-existing condition, up to 17 million children with pre-existing conditions are now protected from that type of discrimination.

there are children without health insurance and beginning in 2014 we'll provide them access to quality coverage by expanding medicaid coverage and providing affordable insurance on these exchanges with a tax credit or some kind of help from the federal government to pay for the insurance. the other thing i wanted to point out, and this is really significant because again, it's kicked in and i've had many of my constituents come up to me an mention it, that is that the affordable care act requires health plans to allow parents to keep children under age 26 without job-based coverage on their tamly's coverage and give millions of parents and young adults that the peace of mind that they can start their jobs and careers without being crippled by health care expenses. what happens is with the economy a lot of kids or young adults when they graduate high school or graduate college, not

able to find a job. or while they're in college. they can't aforehealth insurance on their own, they have to buy it on the individual market system of what the affordable care act says, you can be on your parents' policy and the insurance company has to provide that option up to the age of 26. very significant. millions of young people that did not have coverage are now coveraged by that -- covered by that under their parents' policy. i wanted to take a couple more minutes, i wanted to give some examples new york my district, in the sixth congressional district in new jersey, some of the numbers of people that have been impacted in a positive way by the affordable care act. these statistics come from my committee that i serve on, the committee on energy and commerce, and just to give you some idea, in my district, in the sixth district of new jersey, 6,800 young adults in the district now have health insurance that didn't have it before. 9,100 seniors receive scription

drug discounts for their scription drug coverage. 63,000 seniors in the sixth district of new jersey receive medicare preventive service without paying co-pays, co-insurance or deductibles. 3,1,000 -- 31,000 children and thousands of adults receive health insurance without co-pays, co-insurance or deductibles. 61,000 businesses receive credits to expand their coverage for employees. grants have been given to community health centers to improve health. community centers have expanded in the district because of the affordable care act. and 8,000 children with pre-existing health conditions can no longer be denied

coverage. i want to point out that this is impacting these benefits under the affordable care act, impacting constituents in every district in the country, not just mine. thousands of people in my district but all over the country, millions of people. now i just wanted to talk a little bit about the cost issue because i always hear the republicans say, oh, you know, your costs are going to go up because of the affordable care act. in fact, costs for health insurance now without the affordable care act have gone up but the affordable care act actually is reducing costs for health insurance. whatever cost increases you're exhibiting now are because the affordable care act hasn't gone into effect completely, it kicks in gradually over the next few years. i mare republican colleagues say, oh, your health insurance went up. that's because it hasn't kicked in yet. once it kicks in, there are a lot of positive impacts on cost

that will make a difference. let's talk about some statistics in terms of cost that i think are significant. since enactment of the health care law, the ample c.a., premiums are generally lower ore stable. average premiums are 7% low for the 2012 than they were in 2011 and since the health care law was enacted, these premiums have fallen 16%. average premiums for medicare part d, the scription drug program, in 2012, have seen no increase from the 2011 level. the medicare part b deductible has fallen by $22 to $144 in 2012, the first time in medicare history the deductible has fallen. for most enrollees, the standard part b is quite stable, 6.3% higher than what they paid in 2011, matching the 3.6% cola increasing the steenswror -- seen quors

receive anywhere their social security check. in september of 2011, mercer, an independent benefits consulting firm, released a survey showing that health insurance premium increases will average 5.4% in 20124erks smallist increase measured since 1997. despite republican claim the health care act has played almost no role in private plan increases. in fact, premium increases have taken effect only because the a.c.a. has not fully kicked in at this point. there are two provisions i wanted to mention that deal with costs and that address costs in the affordable care act that i think are significant and that put downward pressure on premiums. one is the rate review and that is that under the health care law there's a new transparency and accountability for insurers with insurers required to publicly justify on the internet any premium increases they are seeking that are over 10% and the department of health and human services has

rate review authority to publicly deem these increases to be unreasonable. they've done that. in a number of states. the health care law also provides $250 million in health care insurance rate review grants to the state to make them enforce and keep premiums down. finally, under the health care law, insurers must spend at least 80% of premiums on medical care and quality improvement rather than c.e.o. pay, profits, and administrative costs. if insurers don't meet the standards, they have to pay rebates to consumers starting this summer system of these are significant ways of cutting back on costs. now what do we see from the other side of the aisle? again, repeel the affordable care act. the affordable care act will repeal, all the things i talked about would disappear. costs would climb, more and more people would have no insurance. all the benefits for seniors, the fact that you can have your children on the policy until they're 26, the gender gap for women. all these things, all the

benefits would disappear and only the bad impacts from insurance companies and being able to do what they want would remain. now so that republicans talk about repealing the affordable care act they don't say what they would substitute for it, but what we do know and again this week, i'm going to close with this, mr. speaker, this week, we fleard the republicans in terms of what they want to do with their budget and again what does their budget do? it essentially privatizes medicare, makes it into a voucher program, causing seniors to spend more money out of pocket for the type of guaranteed benefits that they receive now under medicare. it even foes and impacts medicaid, a lot of seniors or a lot of people are not aware of the fact that medicaid which most people see as a program for poor people, actually pays most of the costs for nursing homes in this country. what happens is, if you have to go to a nursing home, you have

to spend your assets, essentially, with few exceptions, on paying for that nursing home care and after you have no assets left, medicaid kicks in and paid for tissue pays for your mursing home care. what to republicans do? they slash medicaid, block deprant it to the states, they slash it from 20% to 30%, based on however different accounts, 20% to 30% slash in the money that goes back to the states because the states have to match medicaid and they abolish the expansion of medicaid that i mentioned before under the affordable care act because they assume under the budget that the affordable care act is going to be repealed. so not only is there a negative impact on medicare because it becomes a voucher and essentially traditional medicare disappears and seniors pay more out of pocket but with regard to medicaid, which pays for nursing home care, the states are going to get so much less money that the quality of nursing home care will

seriously diminish. i remember back in the 1970's, when you would go to many nursing homes and they were terrible places because we upgraded them and proi vided money to the stays to pay for medicaid that they matched so the quality of nursing homes improved significantly. what will happen, an i'm not just telling this, nursing home industry has said this, with these types of cuts being proposed in the republican budget, a lot of nursing homes will close and the quality of care will diminish. they won't have as many nurses on staff, won't be able to do the things they do now to make people's lives more comfortable in nursing homes and the budget assumes the repeal of the affordable care act which meeps that expansion of medicaid, the subsidy to pay for health insurance, all the things i talked about before would simply disappear. so i know, i make a stark contrast between what the republicans are proposing and what we're doing with the affordable care act in trying on the democratic side to shore

up and expand medicare benefit bus the fact of the matter is, it is a stark contrast. very stark contrast in terms of a world view of what we're going to do in terms of health insurance coverage, what we're going to do to protect seniors in medicare and i think it's very important for my colleagues to understand these differences as we proceed over the next few weeks. i'm very proud of the fact that on friday we'll be celebrating the second anniversary of president obama signing the affordable care act and i'm also proud of the fact that as a democrat, we're going to oppose the republican budget. when the republican budget was proposed last year, it passed the house but didn't pass the senate and we heard nothing more about it. that's exactly what we plan on doing this year because we can't allow medicare been destroyed, can't allow the medicare guarantee to disappear or allow medicare to wither on the vine, as former speaker

gingrich said, as it's vouchered and privatized as the republicans suggest in their budget. with that i yield back the balance of my time. the speaker pro tempore: under the speaker's announced policy of january 5, 2011, the gentleman from georgia, dr. gick reis recognized for 47 minutes as the dez ig thee for the majority leader. mr. gingrey: mr. speaker, i thank you and i thank the majority leader for allowing me this opportunity to take the leadership hour this evening and quite honestly, the opportunity to respond to my colleague, frank pallone, representative pallone, who is a colleague on the energy and commerce committee, in fact, the ranking member of the health subcommittee, as he talks about the benefits, mr. speaker, of the affordable care act. patient protection and affordable care act.

he spent the last 35, 40 minutes talking about what a great piece of legislation that was. all the wonderful things it's done. i'm going to take my leadership time, mr. speaker, to give the other side of this viewpoint. and to suggest that this is not a good bill. that this is not helpful. certainly my colleagues on the democratic side when they were in the majority and two years ago this coming friday passed into law the affordable care act, obamacare, they felt like that this was the best thing since sliced bread. this was the solution to all our problems. and yet, we spent two years cramming that bill, literally

cramming that piece of legislation all 2,811 pages of it down the throats of the american people. when our unemployment rate was 93579%. -- 9.5%, when 50 million americans were out of work, when another 15 million underemployed. this was our number one priority? national health insurance? a government complete takeover of 1/6 of our economy? this is what the democratic majority in the 109th, 110th congress have forced upon the american people. and the gentleman from new jersey can talk about all the wonderful things that have occurred since passage of obamacare, but let me just point out some truths that mr. speaker don't need any

adjectives to explain. the truth is, there were never 47 million people in this country who could not afford health insurance. . there may have been 47 million who didn't have health insurance, but how many million of those people, how many of that 47 million estimate were making more than 50,000 a year? mr. speaker, how many were making more than $75 million -- were making more than $75,000 a year? and how many of the 47 million uninsured were in this country illegally. how many, mr. speaker, were eligible for one of our safety -net programs like medicaid or

the s-chip program for their children with respect to states? and when you crunch all those numbers, there may have been and may be 15 million people in this country who do not have health insurance because they can't afford it. or because they don't want it. they would rather pay as they go. now, i'm not going to stand here and suggest, particularly as a physician member, that that's a wise thing to do, the expression is, to go bare with regard to health insurance coverage. i wouldn't recommend that. but certainly an individual in this country, the land of the free, we have the constitutional right to make that decision for ourselves and our families.

and what the democratic majority did with obamacare, the way they made it work, when you cut right to the chase so they could cover people with pre-existing conditions whether they were nearly seniors or children, to eliminate yearly a lifetime cap, to provide preventive health services that didn't previously exist, the way they did that, colleagues, the way they did that -- and you know this -- they cut $550 billion out of the medicare program. they virtually gutted medicare

advantage. 20% of seniors select medicare advantage, the thing, mr. speaker, speaks for itself. it's an advantage, because that program covers many of these preventive services that the gentleman from new jersey was talking about that are now available under obamacare. they were available under medicare advantage, but now, that program has been gutted. it's been cut 14% per year over a 10-year period of time. so you rob from peter to pay paul. and who is paul? paul are these 15 million to 20 million that are left in that group who have no insurance, many of whom who don't want it,

and now we have created a whole new entitlement program that we cannot afford. when 15 million people are out of work and the unemployment rate, mr. speaker, for what is it, 38 straight months now, has been 8%. the that despite the fact that the stimulus bill and it's $875 billion on shovel-ready projects that he promised, that promised, when the unemployment rate was 7.6%, that this would solve the problem and not go above 8%. it hasn't been below 8% since we spent the money. so i say to the gentleman from new jersey and my democratic colleagues in this chamber, you

fiddled for two years -- you fiddled while rome was burning. and so, yeah, now you can beat the drum and celebrate the two-year anniversary of obamacare while 60% of this country continues to tell you they hate it. they hate it. and they're going to tell you that loud and clear as they did two years ago. they're going to tell you that loud and clear november 6, 2012. i take no pleasure in that. i enjoy being in the majority. mr. speaker enjoys being in the majority, but our responsibility is to the american people. especially to our seniors, our

moms and dads. those folks who are struggling, who are on a fixed income. but to suggest that we are helping them when we cut their program $550 billion, to suggest that closing the doughnut hole is a good thing and lowers the cost of health care and lowers the cost of prescription drugs? no, it doesn't. because what this federal government, what uncle is doing is forcing the pharmaceutical industry to pay for that doughnut hole and to pay for it with brand drugs, when prior to obamacare, we were filling that doughnut hole with generics. so what's going to happen? this will pharmaceutical

industry, squeeze that balloon, it will bulge out on another side and will bulge out when they raise the premiums for prescription drug coverage for everybody else. you know, the gentleman talked about these wonderful exchanges that are going to be set up for the people who don't have health insurance. i don't object, mr. speaker, to the idea of setting up state exchanges. i mean, that's an idea that has been around for a long time. didn't just originate with obamacare. but when you hear my good friend from new jersey, the ranking member of the health subcommittee on energy and commerce and he certainly should know of what he says, that in

these exchanges, that people are going to get a subsidy, in other words, that's a government handout. they're going to get a check if they make $75,000 to $80,000 a year. colleagues, you heard him say it. now, i would like to ask the 700,000 people in the 11th district of georgia what they think of $70,000, $75,000, $80,000 a year and getting a government handout, a subsidy? my people, the people i represent would feel wealthy if they made $75,000 a year and they would not be expecting a government handout.

and what this administration has done with this piece of legislation, mr. pallone criticized the republican idea and the republican budget of block granting the medicaid program, the medicaid program, colleagues, you know. it's been around since 1965. it's a good program. it's shared between the federal government and the states. but under obamacare, states are told that they cannot be innovative in regard to designing a medicaid program that best fits the needs of the citizens of their state. it's called maintenance of

effort. obamacare says to the governors of the respective states, you can't do anything, you can't make any changes whatsoever in your medicaid program. you can't check on eligibility. you can't check to make sure that an individual that applies is in this country legally. you can't drug test these individuals. you can't do anything to make sure that that program for your state is going to those who need it, who are eligible for it, a to -- who deserve it because of this maintenance of effort restriction under obamacare. not only do we put handcuffs on

the chief executives of our states, but we also mandate, mandate that they now cover under the medicaid program people up to 133% of the federal poverty level. prior law, the requirement was 100%. yes, some states went above that when times were good, when unemployment was 6%, instead of 9.5%, as it is in my current, great state of georgia. but states can't afford to do that. but the federal government comes along and says because of obamacare, we are going to force you to stay where you are. you cannot make any changes. you cannot go down to 115% or 100%. you have to stay at 133%, and we

are looking at an additional cost to the states over the next 10 years of $15 billion. that's why this is part of the lawsuit that the supreme court will hear next week in the six hours of testimony. that and this individual mandate in obamacare that forces individuals to engage in commerce. not the federal government regulating commerce, as provided for in article 1, section 8, clause 3 of our great constitution. oh, no. this says whether you are engaged in commerce or not, mr. speaker, you have to participate

. i know my colleagues have heard the expression and the comments from me and others, what's next? everybody has to eat broccoli. it's absolutely absurd. it's patently absurd for the federal government to tell people they have to engage in commerce. we understand the constitution and the right constitutionally to regulate existing commerce between states, but not to force people. so as i have these moments tonight to talk about as a counterpoint to mr. pallone in regard to the affordable care act, patient protection and affordable care act, mr. speaker, it could not be more

unaffordable. the c.b.o. just came out with a new score, originally, two years ago, that score was something like $950 billion. and according to smoking michigan r mirror accounting, completely -- mirror accounting, completely paid for. it's about twice that. it's about twice that. so not the affordable care act, but patently unaffordable care act. for my colleague to criticize the republican majority for coming forward with a budget that includes a plan to save medicare and medicaid, legacy programs, programs that our

seniors and our poor are so dependent on, for us to have a plan to save that and for the gentleman from the other side of the aisle to criticize that, i ask him if he were still in the chamber, and i ask all of my colleagues on the democratic side of the aisle, what is your plan? what is your plan to save the medicaid program? what is your plan to save the medicare program? how many different studies do we need from how many different commissions over how many years before we accept the plain, hard, cold truth that the hospital trust fund and medicare program will be insolvent at the

very latest by the year 2024. and by the earliest, at the year 2016. as estimated by the medicare actuaries. . nobody denies that, but what are my democratic friends doing about it, mr. speaker? they're doing two things. they're whistling past the graveyard, and they're enacting ipab. independent payment advisory board. colleagues, you've heard it all evening as we have discussed the repeal of ipab and h.r. 5, the health act.

ipab is 15 unelected bureaucrats, unelected but appointed by the president, this president, at a salary of $176,000 a year for a six-year term renewable for another six so we're stuck with them for 12 years and that fat salary and benefit package, so they can say we're going to save medicare by cutting reimbursement to health care providers and scription drug companies. we can't change the age of medicare eligibility. we can't increase the annual deductible or co-pay. no, we can't do any of those things. we can only cut provider

reimbursements. oh, but there's no rationing. it says there in that section regarding ipab that no rationing will occur. well, give me a break. you cut reimbursement to providers, they stop providing the care, the senior does not get that knee replacement, does not get that stint -- stent put in. you can spell it any way you want to, but mr. speaker, that's rationing. that's rationing. the american people don't want that. our seniors don't want that. that's no compassion. you can provide all these preventive services you want to

that mr. pallone was speaking about. and that's fine. if you can afford to do it. but to suggest that that saves money, it might save an individual life, and that's a wonderful thing. but don't stand up here and tell me and tell my colleagues on both sides of the aisle that preventive services saves money. no economist, no health economist would agree with that. it doesn't save money. it costs money. and every time you add another free preventive service to a program, it's going to increase the health insurance premiums for everybody else. these are called mandates. the gentleman from new jersey talked about direct access

without prior approval, whether it's to see your ob/gyn doctor, your dermatologist or general surgeon without strog go through a gate keeper. i understand that. i practiceded me sip 31 years. i think my colleagues know that. i understand that. but these things definitely cost money. they don't save money. and i think it's important for people to understand that. he talked about the fact that the wonderful things that have already occurred under obamacare, allowing adult children, i realize that's a bit of an oxy moron, but i've got four of those oxy morons, allowing adult children to stay on their parent's health insurance policy until they're

26 years old without regard to whether or not they're students. now, prior policy, most health insurance companies, if you were over 21 years old, maybe in the third or fourth year of college, then you were no longer eligible to be covered under your parent's health insurance policies. the expectation is that you would have a job. well, the reason it's so important now to have them covered up to age 26 on their parents' health insurance policies is because they have no jobs. and that's the thing that this administration and this now, at least in the house of representatives, democratic minority, they just don't seem to understand that what the american people care about first and foremost is a job.

they want health insurance, of course they do. if they have to, they'll pay for it out of their own pocket. but they've got to have a job first. they've got to put food on the table. they've got to put clothing on the backs of their children. they have to have the pride and dignity and respect of having a job. and as we go into these elections this fall and all 435 of us in this body and 100 -- in fact, i guess it's a third of the other body stand for re-election, an we elect a 45th and indeed, i think we will, elect a 45th and not re-elect a 44th president of the united states, it's going to be based on jobs. and the economy. and that's the thing that this

president, since he took office in january of 2009, has just totally missed the point. and really, it started in january of 2007 with the democratic majority in this chamber, when we spent another two years wasting time, fiddling while rome was burning, trying to force, cram down the throats of the american people this cap and trade regime, which would have cost every family $ 2,500 a year in increased utility costs. thank goodness the other body stopped that. because the american people didn't want it. and they don't want national health care. that's why we voted in this body h.r. 2 to repeal

obamacare. that repeal passed in the house of representatives. we finally had a vote in the senate. we couldn't get them to pass a budget, they haven't done that in three years, but after about a year and a half, we finally got them to vote on repeal of obama care. the democratic majority rejected that. so mr. speaker, now, we're dealing with plan b and plambings -- and plan b is to chip away at the most egregious aspects of obamacare. it would be a respect -- it would be a mistake for us to assume that the supreme court will strike down that individual mandate, will strike down that medicaid expansion, that unfunded mandate, the $12 billion burden placed on the budgets of our respective states. i think they will strike it down.

but i'm not going to stand here in this chamber, holing my breath, waiting for that to happen. that would be irresponsible. that would not be representing the people of the 11th of georgia the way they deserve to be represented. so we are going to fight, and that's what this is all about today and the vote tomorrow in regard to repealing ipab, this independent payment advisory board that literally takes legislative responsibility away from the congress.

and i expect harry reid and the democratic majority to do the responsible thing, they don't like it either. they don't like it either. let's don't make an election issue out of it. let's just do the right thing for the american people. mr. speaker, it's been a long day. we have had a lot of discussion on the floor of the house of representatives, a lot of eloquence on both sides of the aisle. and i feel very strongly that we should respect one another and i think we do. but when you feel you have the right idea, it's your responsibility to stand strong. not to pander to anybody.

but to stand strong and do the right thing, do the right thing for he american people. with that, mr. speaker, i yield back the balance of my time. the speaker pro tempore: the chair recognizes the gentleman from georgia for a motion. mr. gingrey: i move that the house do now adjourn. the speaker pro tempore: the question is on the motion to adjourn. those in favor say aye. th

coverage at thursday at 10:00 a.m. eastern here on c-span. >> ben bernanke and timothy geithner said today that europe financial debt still poses a threat to the u.s. economy but the strains on the system had eased in recent months. that hearing is next. after that, at a house debate on repealing provisions of the house law. the remarks from president obama. >> in march 1979, c-span began the house of representatives. now it is available on television, radio, and online. >> you think you have to speweo

feed them. they know better than that. he ought to say something. that is right. >> c-span, traded by america's cable companies as a public service. >> now federal reserve chairman ben bernanke and treasury secretary timothy geithner testified about the state of the european economy and the threat thedebt problem househas on committee. >> the statement is we exist for a fundamental principle. perce, americans have a right to know that the money washington has is well spent. americans deserve an effective government that works for them.

our duty is to protect these rights. our responsibility is to hold government accountable to taxpayers. they have a right to know what they get from their government. today's hearing is most important because in 2009, europe has been struggling to emerge from a sovereign debt crisis brought about by massive government spending and a weak economy. america could say the same. we have been struggling since 2009 to emerge from the debt crisis from the massive government debt.

that is not the issue today. the issue is if the european union spends hundreds of billions of euros with imf assistance. can america afford one sovereign debt crisis such as greece? we have been watching the crisis. there is a certain assumption that eventually it will be solved. there is an assumption that we know what we are doing and that it will be solved. clearly, at this hearing builds on the good work of patrick henry and is asking the greater question.

what if we go beyond greece? there are other means of the problem is manageable. our witnesses are the two most important individuals. they have a good understanding of the capabilities and ultimately what he can do it if you go wrong. secretary geithner has been a loyal servant and has been intimately involved in matters in europe. our primary question will be on what u.s. exposure to the u.s.,

what impact to taxpayers it could be. we will try not to look to the past but to the future. let's understand that while we have a budget deficits, our debt is 100 term of gdp. we are still remembering the good in the very bad of tarp. we are remembering the individuals are involved in what it would be spent for. none came to pass. the secretary geithner does not anticipate needing a bailout. our obligation is to anticipate and to plan. the questions will be what is plan b. with that, i like to recognize

the member for his opening statements. >> i thank you for your service in our country. i thank you on behalf of the committee. this is a very important issue. european officials have taken actions to reestablish the ability in a eurozone. american officials have helped the consultations. no one is declaring mission accomplished with the signs of improvement are hard to miss.

the house republicans released a budget proposal of $5.30 trillion over the next 10 years. its will shift costs to seniors. the majority will seek for greece's financial troubles. the united mstates should cut taxes to avoid these things. do not believe it. while strong medicine is needed, who should be taking the hit? what we have learned is that austerity measures imposed have very real negative consequences for hard-working people what

they leave the economic elite unscathed. secretary geithner warned against this. you said this. "we need to stay intensely focused on strengthening our economy in the short term. we cannot share cut our way to growth." house republicans have viewed this. different problems require different solutions. economists agree that the investment grade by wall street or the forces of our economic collapse.

's sad truth is that millions of barrels or not need the belief -- borrowers will not get the relief they need. regulators will not allow them to participate in the settlement. much of this will be in the form of printable reduction. we want to ensure our economy at home is strong enough. we must end of the housing crisis here at home. the un data shows the principal

reductions would save taxpayers billions of daughters. -- billions of dollars. it is my hope that we examined the euro crisis in keep in mind what shooshould be our opening . i ask consent to enter this into the record. >> this addresses this issue.

>> thank you. >> you are welcome. when i go to the chairman of the subcommittee for his meeting. >> thank you for calling this meeting today. americans watched this deteriorates. it resulted in millions of job losses. several banks are propping up institutions. our european friends fight to fend off a wave of turmoil. in december, my subcommittee invited officials from the federal reserve and what actions they would consider in reaction to it and what measures remain.

the federal reserve had just authorized liquidity swap lines. the headlines read to the tune of billions and trillions. an auction to provide banks with over 500 million euros. it an event was acquired in greece. as the book ahead, european story is far from over. they're trying to substantiate their record effort. their balance sheets to rescue the global economy.

the economic storm facing europe has this. we are here to address this incredible issue. i am interested to hear how our foremost efforts of you this. with that, of a bike to yield the balance of my time. >> i thank the gentleman for yielding. the chairman said that he wanted to find out if the united states possibly could be drawn into the euro crisis. i have been to europe. i been all over the place. i am convinced we are already drawn in. i would like to find out how deeply we are drawn in and out

simple the problem could be. i want to find out if we are bailing out the europeans. the european central bank is over there as well. they are having their money supply. my colleague talked about the money swaps. let me first say that exposure is 641 million of dollars. for france and germany is $1.20 trillion.

we have $109 billion outstanding. what does this do to our exposure? how much will that cost the united states? timothy geithner has dismissed reports that we might participate in a special european aid fund. i would like to know that to be true in the future. increased our contribution to the imf which is currently 17% of the overall budget. they will need another $500 billion. how much exposure are refacing right now attacks come at exposure are we likely to have

added? will be underwriting the crisis tax thank you. >> i think the said committee chairman. the bill goes to the ranking member of the subcommittee, mr. quigley for five minutes. >> thank you. i am honored to be the ranking member the european debt crisis met this. in 2010, our forces totaled 430. the global market is not what it was 10 years ago or five years ago.

there can be no question a help the european economy is in the best interests of the united states. i am encouraged by secretary geithner. i'm encouraged by the efforts by our leaders. beaders created a compact under 25 days agree to new rules. kris' recently restructured debt. the european central bank is also purchasing bonds and providing loans. these actions have lessened the market here at home.

the eurozone has a long and challenging road ahead. some have likened our economy to increase. -- to greece. we need a balanced approach to get our own fiscal house in order. we have to ensure that reducing the deficit we do not a the mission of government matters. they made harder to fill this mission. we need to take a balanced approach to measures. now is not the time to pull the rug out from under them. a long-term deficit reduction plan is not compatible with economic growth.

we cannot allow politics to stand in the way of the foreclosure crisis. strengthening our economy must be the number one priority. it either afford to hearing the testimony. thank you. i yield back. >> before i introduce the witnesses, i want to caution the committee it is our policy when i invite guests to tell them what the committee is about and expect they will have answers for our questions. at the same time, they have an

expectation that today's hearing is primarily a technically been exclusively about the european debt crisis and how am i effect america. although there is a ripple effect that he may want to ask broader questions, if you ask questions that are not germane to the subject to which we invited our guests, it is their option to say whether they were prepared or not prepared. the only ask them here under that fairly narrow subject. you are very good beyond that. we do not intend to have the ask questions and expect you to answer them. with that, we submit to our committee roles.

-- rules. >> please raise your right hand. do you solemnly swear that this is the truth, and the whole truth and nothing but the truth? all witnesses answered in the affirmative. please take your seat. >> a little bit like yesterday, we've of like you to stay as close to five minutes as possible. as we would like you to know that you're opening statements are placed in the record. i'm not sure we did a coin toss. >> thank you. thank you for giving me a chance to talk about the implications.

we have an enormous respect for your efforts to avoid the crisis. our economy is getting stronger. with a lot of the challenges are here. unemployment is still very high. housing markets are very weak. we still have a long way to go to repair the damage. risks around iran are adding to pressure. this accounts for about 18% of global g.d.p.. it is a major source of sourcing.

a larger portion our for our trading partners. the financial markets damage confidence been slow the momentum of recovery here in the united states of the past few months, there are active encouragement support. they have put in place a comprehensive strategy. first involves economic reforms, a tough reforms. they can improve the competitiveness. the second includes reforms.

they have stronger disciplines. they can limit the future deficits and debt as a share of gdp. it involves a coordinated effort. the european financial system and involves a fire wall of a fund's to provide this to the government. they can help retain this. the efforts have helped calm financial assistance to reduce provincial tensions. -- the efforts have helped calm financial tensions. we're going to have to carefully calibrate financial support and fiscal consolidation.

these will not work with the support that enables the government to borrow. if every time economic growth comes in weaker than expected, governments are forced to say this. the most important unfinished business of this broader financial strategy in europe, met leaders are reviewing options for how to expand at the combined capacity of the two funds so they can make clear targets to make resources more available. the imf has played an important role in europe. there are financial support for

ande in greece, ireland, portugal. it is in the interest of the united states to continue. the resources cannot substitute for the incredible european firewall. this has played a major role in every financial crisis. any resources with interest that has gone awry is backed by financial safeguards. they have more than 60 years of experience. the crisis in europe has take some of the wind out of the recovery. we hope they will build on these efforts in the coming weeks. there is a stronger financial

firewall. we will continue to work closely with them. >> thank you. >> thank you. thank you for inviting me. for two years, they have this on global financial markets. there are concerns of fiscal sustainability. pessimism about the economic situations can undermine confidence. this is an impact on the u.s. economy. we have seen those underperform.

financial strains have been evident during times or it is most turbulence. we saw a global retreat from riskier assets. it can increase the cost of corporate heads. we have seen our own financial institutions focus on your. we have seen some improvements in recent months. it has helped improve its own financial markets. several actions have contributed. bacon undertaker financing operations that have helped the funding. banks have increased their holdings of sovereign debt. secondly, the euro leaders have

been taking steps to on a more sustainable fiscal path. the sovereign debt best mcginley reduced. did they are intensifying their efforts. the key u.s. and imf have pledged considerable funds as part of the package. the economy remains in a deep recession. there has been the approval of the new fiscal compaq treaty. it isn't important step toward solving fundamental tension. although progress has been made in more needs to be done, there is an expansion of fire walls regarding contagion and sovereign debt markets. there are continued efforts to

continue the growth. the federal reserve has been following these closely. policymakers are focusing on this from having any adverse once contribute. it they can support the flow of credit. news of are reestablished lines was limited. in late november we agreed to the central banks of canada and switzerland to extend this period the lower cost of the ecb have a loved and to reduce the cost. they provide them.

this has had a beneficial impact i would add the swaps are very safe. they present no exchange rate. each is trying has a short maturity. their currencies for what is here. the fed is working with other agencies to monitor our

financial institutions. the money markets have avoided this. our assessment are broadly head-in the other direction. these are broadly dispersed. although they have limited exposure, their exposure to european banks are much more material. these funds remain structurally it vulnerable. the risk of contagion does give concern.

the u.s. financial sector would have to content with an array of broader markets and equity prices. most recently, at the fed released the results of our comprehensive capital analysis. it is a stress tests. we imposed a hypothetical scenario. it involved a deep recession of the united states. there is a decline and activity abroad. this was designed to capture but exposures for the financial stresses that my arrive. it shows is it if they get majority continue to make

expectations. the recent reduction remains difficult. it is critical that leaders follow the policies to insure this. i'm sure they understand the challenges they face. they take the necessary steps to address the issues. they work with our financial institutions in counterparts and are ready to use the tools at our disposal. >> thank you. in the stress tests, i assume the fed system would work.

is that correct? it is all of the $1.40 trillion. we checked to make sure we are comfortable with the counterparties. that means degraded yourself. correct? >> we looked at the positions of the banks. we verified they are largely hedge against sovereign defaults in europe first. we assured ourselves to have the strongest institutions. aig was not properly regulated. it was done appropriately -- it was not appropriately hedged. >> you are comfortable saying there are no i e -- aigs hiding

in the woods? >> they have covered all the largest bank holding companies. we looked at other large banks. we do nott rancege, see any similar problem. >> thank you. >> one of the most important questions is to ask about earlier times. the eurozone has an economy that is nominally our size. it has a euro conversion of about $14 trillion. some countries have positives. it is clear for the american people to say the same size is

similar. if this is the case, why have are they not being treated much more likely treat our states that what is the justification for the american people for the sangar wealth to buyerours, which part of the united states put in? >> we have a fiscal union as well as monetary union. the reason we do not see the same kind of stresses is that

from the federal government -- >> from the taxpayer, they are similar to us in the positive side. human beings move freely within the eurozone. money moves freely. they act as a protective trade partner. they treat each other in a way they do not treat us. we do not enjoy the advantages of selling into the arizona that the eurozone enjoys. -- into the eurozone that the eurozone and joyce. we are doing it in our own self interest. eurozone of being asked to step up much more? hy isdoes it come to the

american people when they have the same wherewithal? when they have a problem with a rogue nation, they turn to the imf. >> that is a good question. our position has been that europe needs to step up adn nd do more. we've asked them to move in the same direction as the united states. >> as you said, we have never lost any to the imf. we have been fully repaid it has been a good bet overall. the american peopele are

wondering what i ask. strengthen your hand when me clear that the american people are saying "no, convince usaave to to go against the the communities." >> we have a very similar view. europe is a very rich continent. you are right to point out, they do not have the mechanisms that we do in the united states. these are very powerful. the imf is an institution where members have a brigright to reqt

assistance. our judgement has been in the intersted in the u.s. and better for us for the imf to play a modest role alongside the european authorities going forward. they have asked the imf to take more of the burden. we said that is not appropriate. they are a rich country. let's make sure people understand the world needs to see europe demonstrate that they are prepared to do what it takes to make this work. we can help with support. we are not going to do that in a way to put the u.s.

taxpayer at risk. >> thank you. >> thank you very much. europe has a housing crisis. europe does.yo >> you agree that housing has to be addressed? >> i do think our economy is still suffering from a lot of collateral damage. you see that in housing. our judgement is that we should do everything we can to help repair that damage. to help the economy over time. >> it would be the cost of more than $5 trillion in medicare

that we know of. chairman bernanke and i have talked about the same number of times. yougave a speech in whciich said principal reductions may be an effective means of avoiding foreclosure. is that right? >> sometimes it can be effective. >> you also agree that principle reduction can be one that is well designed. is that right? >> yes. you have private banks on their own offering this to their borrowers. the limited number of countries

are taking somewhat different approaches. it is different because of the nature of the problems. cannot see this across the housing front yet. they have not been aggressive as we were in trying to move earlier. >> they tow their bottom line. they want to keep people paying lower mortgages and said the foreclosures. this helps the homeowners and shareholders. the only official who does not view that appearst to be [unintelligible] his opposition is trange

because his own data shows principal reduction would save billions of dollars and that principle reduction would help the homeowners. based on his own data, he should be doing printable reductions now. -- principal reductions now. can you tell us why treasury is doing that? why are these incentives important? >> under the law, treasury does not have any authority to tell the fha to undertake specific activities. under the mandate, it have to

make sure the things they are doing are in the interest and taxing region of maximizing overall returns to the taxpayer. principal reduction is part of the strategy to limit the losses. we have been having discussions with them about how to narrow the differences. i think it would be better for me to come back and talk more about it separately. we could get a better sense of where we come out. >> he said the minister of the costs could be high for i.t . systems. he is made that argument to you.

>> he is in the process of looking again at those questions. >> your response was to "look further?" >> yes. we want to make sure they're doing things consistent with their obligations. making sure they're doing things that will limit the losses. the future losses to the taxpayer. >> mr. demarco controls all of the loans guaranteed by fannie mae and freddie mac. how many can be affected by his decision? >> not millions. it is a little hard to tell. i know it is not part of the popular wisdom. but there are more conservative and more careful in their underwriting standards. so the quality of their loans are better than the broader market in this context. again, our job is to make sure

we are doing a reading weekend to reach as many people as we can. whether this is a good strong case on the merits, not just on the taxpayer. >> thank you. the secretary will also send you a copy of the field during intermission from brooklyn which actually has said and other representatives testimony to the points to your brief before you come back to the ranking member. with that, we go to the chairman of the full committee emeritus for five minutes. >> is that what you call me? >> annmarie this is a forever term. -- emeritus is a forever term. >> according to crs, the exposure that the united states has in portugal as of last year is $54 billion. ireland is 111 billion current ileus $103 billion. spain $244 billion.

germany $635 billion. and france $685 billion. $2.08 trillion.wo. i wonder what will happen if the euro stars to devalue and how it will affect the united states ability to collect on these indebtedness we're having with here. my first question is -- and i will combine some of these questions so you have more time to answer -- we are printing money and have been printing one many -- printing money with qe1 and qe2. is there a long term cost? the federal reserve has created

this foreign currency spot magnuson and it has outstanding loans -- spot outstanding mechanism and it has loans that is a considerable amount of money. i would like to ask what happens, if you do have some defaulting over there and they cannot repay those loans -- and other european central bank is printing money right now -- that will cause some kind of inflationary pressures as well -- what will that do to the indebtedness we have indexed the foreign-currency swaps take your money and exchange is it for euros. i would like to have the answer to that. and it appears as though we're providing daughters that are loaned and swap in europe and then are used to buy european bank bonds and then sold to commercial banks. if that is processed, it looks like we're cooking the books to

make this all legitimate. finally, i have been to a number of these countries. the unrest is very apparent. some of our european neighbors have not passed austerity measures. and even when they had passed some of these reforms, you still have an awful lot of dissension in the country. they have had changes in those governments. i think there're are still big questions over whether greece can survive in maybe italy, spain, portugal, and so forth. so to what extent are we exposed if this so-called european recovery does not take place? can you give us the figures for at least roughly the figures, both directly and indirectly, as far as the exposure is concerned? and do your numbers include foreign currency swaps with assistance from the fedele reserve or the treasury? i know that is a lot, but, if you can run to that, i would

appreciate. >> on the swaps, use of the maxim was $109 billion. it is down to $65 billion because it has been constructive and beneficial to the united states. if the euro the values or depreciate, it has no effect whatever on the value of our liability because we get paid back in dollars. so the european takes any foreign exchange risk. if the bank they lend the money to, if it does not pay, we still get paid because the ecb takes all of the credit risk. we're not taking any credit risk. we're not taking any foreign- exchange risk. the risk of losing the money is a very low and the benefits are quite significant. on exposure, you mentioned some numbers. exposure clear who's you're talking about. our banking system is exposed to europe. it is a major trading partner.

it is exactly what we tried to do in our stress test scenario that we recently released results for last week. a sharp decline in activity in the united states, major financial stress, including 50% drop in stock prices -- all of this is an intent to measure our banking system for a new crisis in europe. of course, there would be significant losses. but what we found was that all of the banks essentially were able to meet the reasonable level of credit -- i'm sorry, the reasonable level of capital, even following the loss associated with such an event. >> thank you, mr. sherman. >> mr. quigley. >> thank you, mr. chairman.

i guess the academic question is the balance that i talked about in my opening statement about austerity measures and how they impact recovery, your view in general on that issue and how the european plan seems to strike that balance and how effectively it might do that -- either or both of you, please. >> i think the answer to your question depends on which country you're talking about. there are countries like greece, ireland and portugal which are currently under european union, eurozone, and imf support appeared which have essentially no alternative but to your the can to reduce their fiscal deficit. there have been trying to do that. but slowing growth has made it more difficult. more broadly, there are some countries that have more distant space. they might consider a balanced approach, which leaves some

flexibility in the short term to do with the fact that europe is slowing. their economy is slowing. at the same time, addressing longer-term issues in a comprehensive long-term plan, for example, they're trying to do that through their fiscal compact. it is an approach that the united states might take, which is a comprehensive plan that has both a short-term and long-term component to it. >> the chairman said it exactly right. if you distinguish the companies -- the countries that lost the ability to garner support still have that capacity. in general, for the country's not in this stage of crisis, you want there to be in medium-term plan to gradually phase in the reductions of the deficit yet to come. and you want that to be balanced by and complemented by the reforms that will improve

the performance in the economy and make it easier to start a business and stuff like that. it is important to get the balance right. it could take a lot of financial support to make sure those reforms have time to work. you want to make sure they're phasing in gradually over time. and you want to avoid the risk that, again, every time growth disappoints and the short-term effects on the deficit will increase the deficit. you want it matched with immediate cuts and deficit appeared if you do that, you add to the challenges on growth. that is the balance that you want to have. >> how did they do? >> if you want to talk about the countries that are more acute like greece and italy and others, how do they strike this ballast? how optimistic are you? >> if we are so dependent on the recovery and perhaps we can learn from lessons there, did they go too far for these countries that are really hurting?

>> i do not think you can consider that in greece and ireland. once you get to that point, there is no choice, no alternative available to them rather than to this mix of a very tough reforms across the border in other countries in europe, they have more time and space to bring a bit more care and balance to the path. greece and ireland and portugal are very small academies, leaving aggregate in that context -- even at it in that context. in the united states, we have a longer time of economic growth then the other countries in europe. they are able to shift some of the tension and some of the focus and europe to broader strategies that will make growth stronger across the continent. >> in your overall assessment, the chances for recovery -- why are they perhaps less optimistic or more optimistic about where europe faces versus

the u.s.? >> the fundamental reality of the u.s. is that it will take a very long time for them to work that through. judge realistically, looking at the prospects ahead, even if europe is able to be successful in avoiding a catastrophic financial crisis and they have the means to do that, even if they're successful in avoiding that, then the risks are that europe is still growing on average at very weak levels. that will mean that growth in the united states is weaker than it otherwise would be. again, this process has a lot of risk in it. there is a -- it is very fragile that is why it is so important that they're doing everything they can, not just to restore some financial stability, to help lay foundations for stronger growth. that is why we have such a strong economic interest in helping them make that happen. >> thank you. >> a very good line of

questioning. we go to mr. mcenry for 5 minutes. >> thank you both for your service to our government. you certainly have both served in some challenging times, not just in the last three years, but a long run as well. chairman bernanke, i want to ask about your legal authority, the fed's little 40. -- legal authority. so the fed establishes sovereign debt for the united states. does the fed have legal authority to purchase other country's sovereign debt? >> it does for the purposes of reserve holdings. they currently hold a small amount of debt of very high quality. i think it is france, germany, and japan. but we are not in beijing and

purchasing debt of troubled countries. >> but that could be considered? >> we are not considering it appeared >> -- we are not considering it. congress made clear in earlier discussions, some decades ago when this issue came up, that the purpose of this authority was to maintain foreign exchange reserves. i don't think that it was the intent of congress that we get involved in sovereign debt issues. it is not our intent to do so. >> beyond that, does the fed accept as collateral foreign debt, sovereign debt from foreign countries? >> some of the debt we simply own as part of our foreign exchange reserves. >> beyond that pierre >> in other cases, we have short-term resources agreements and other arrangements where we do take collateral for a short time. again, we're making sure that we have sufficient to make sure

that we're comfortable with the safety of those short-term arrangements. >> secretary geithner, to have a few questions about the international monetary fund. within treasury, you have a designee who serves on the 24- member executive committee of the imf. in terms of the actions taken with the recent imf loans to greece, were you involved in the process? was that a discussion you were engaged in? >> of course. we pay a lot of attention to any decision, any meaningful decision the imf makes in the context. >> looking at that, is the treasury -- i know you have mentioned this before, but i want to raise the issue again. are you considering additional

contributions to the special imf european bill a fund? >> no, we are not. the imf already has $400 billion of available resources it can use if necessary to help support the needs of its members. europe, of course, has very substantial financial capacity to put behind their strategy to resolve this crisis. therefore, we do not see the case for coming to congress and asking for more authority in this context. >> is the treasury considering being involved in imf nab, the arrangement -- >> we are in that. congress has participated in them. so, yes, when the imf draws on the new arrangements to borrow, just like a supplemental pool of resources, then, yes, the imf draws on the quarter resources. we do participate in those

drawings. we have 60 years of experience with how the imf puts itself in that context. the record supports our judgment that there is very substantial strong financial safeguards that protect the interests of the u.s. taxpayers in that context. >> under god for it -- under dod-frank, there are a number of provisions dealing with the imf. our designee engages in a decision with the imf to loan money with a country that has a greater than 100% debt to gdp ratio. the understanding of what the credit risk is and how this decision was made. is that being done? >> of course. we have a rich history and a long history of the votes we can

cast in that institution. we will meet that. >> -- >> the way that provision is structured, in some cases where the existing level of debt in the country is high, there is a higher burden on all of us to make sure that the reforms that come with this assistance give us a reasonable prospect that it will be improving the path for sustainability. >> i look for to the report. >> thank you appeared to clarify for the record, i heard correctly, the imf does not maintain a whole pile of money. they maintain the ability to draw by the members based on an allocation. so the american people understand, you're not coming to was for new money, but there will be distributions at times within the current limit that just occur as a result, a trigger. the fact is they will be taking your money. is that correct?

>> that is exactly right. the way the law of the land is structured, we cannot lend money to the imf without the authorization of the congress of the united states. congress authorizes the scale of the commitments we can make members ask the imf for resources and they have to meet conditions and then they can draw on those resources. then we provide a part of those resources. again, the exposure we take is backed by not just a substantial amount of imf gold, but other sidsafeguards. >> thank you. the gentleman from virginia. >> thank you. welcome to both of our guests this morning. mr. geithner, you testified that ireland and portugal ran a large surpluses but they were victims of the crisis contagion. you also noticed that spain reduced its structural deficit through austerity measures.

do you believe that there is a lesson that's -- some lesson in that? i would think that to have this kind of crisis, it would be deeply in the whole of debt. how does that work? >> you are right. i think the popular perception is that the crisis in europe is overwhelmingly the result of dust -- a tickets of fiscal profligacy. that is not quite right. it was certainly true increase where greece -- it was certainly true in greece. >> i will come back to greece. >> there are other countries where you saw a rise in private borrowing in the banking system by the private sector. a damaging loss in the relative competitiveness of their businesses relative to germany in that context. when the crisis hit and

confidence eroded, their fiscal positions did deteriorate dramatically, as always happens in that context. but the fundamental cause of the crisis was not a long time of extreme fiscal profligacy. >> mr. bernanke, one of the medicines' recommended here, obviously, is draconian fiscal austerity measures. we had a new budget out yesterday that certainly subscribe to that philosophy. many european countries actually adopted that policy in terms of austerity measures. did those economies grow faster or slower than the united states since 2009? >> the economies of europe, with the exception of your to some extent, have grown significantly slower than the united states during this time, probably for the reasons you said. there crisis was more acute than ours. there in earlier stages.

they reacted more tentatively than we did in the united states. for the reason, the scale of the challenges they feasface has ben weaker. the context is that you do want to be careful to try to balance the imperatives of restoring fiscal sustainability with the recognition that long-term fiscal sustainability. >> one of the comparisons that is often cited by some even here in this body is that the united states does not busy is not careful given its debt posture and its lack of discipline will look alarmingly like greece. i personally find the comparison invidious. upon any examination, given the fact -- i refer to michael

lewis's book on the european crisis, it is shocking what happened in greece. they did not have macroeconomic data. they engage in outright deception when eu officials came to examine the books. they did not have any central control over their own economy at all, unlike the united states. but i would like each of you to comment on that comparison. is the u.s. headed toward the road of greece? >> it is certainly true that the situations are not directly comparable. first, increase's debt introductory -- dead tree to tree looks worse than ours or that of other industrial economies. -- debt trajectory looks worse than ours or that of other industrial economies. their short-term issues are not

-- cannot be demille ameliorated by monetary policy since their part of the eurozone -- cannot be immediately ameliorated by monetary policy since therthey e part of the eurozone. they need to find a strategy that will credibly unconvincingly put us on a pasph of long-term sustainability. >> thank you. >> no basis for comparisons with greece. we can recognize that our fiscal position, long term fiscal position, we are in a much stronger position than the economy as a whole. it is probably because our economy would grow faster than europe's overtime. it is probably because we are a younger country. it is probably because the commitments we have made to health care and social security, even though unsustainable, are

much more standing than the ones in europe as a whole. we are in a fundamentally different position and more comfortable position. of course, in the united states as well, we have made a stable -- and sustainable commitments. we have a little bit more time and substantially more room for maneuvering how we address those. it is very important, as we address them, we need to address them and not put them off indefinitely. we need to do those things to help the economy to grow. >> the gentleman from south carolina. >> mr. chairman, is there a connectivity between the cost of energy and economic recovery? >> yes, there is, especially when there is a supply side element.

higher energy prices create at least short-term inflation. that act as a tax and reduce consumption spending and that is a drag on the economy. yes, higher oil prices and higher energy prices are a concern. >> i think the price per gallon in europe is a double if not more what it is in the united states. >> yes, because of much higher taxes. >> can you imagine any scenario under which someone would advocate boosting our price per gallon to european levels? >> there are a lot of policy issues related to that. >> i need for economic reasons, not environmental. economic. >> the question is whether or not there are other goals that are served -- environmental goals, congestion goals, and the

like pierre >> -- and the like. i think higher energy prices would slow growth in the long run. >> what would you use to describe if are price per gallon suddenly doubled? >> that would have a catastrophic -- >> i would not say that would have a catastrophic event, but an effect one consumer confidence and boost of inflation. >> what is our debt as a percentage gdp curly? >> i can give you the precise numbers in writing. as we -- as a percentage of gdp currently? >> as i give the person -- i cannot give you the precise numbers, unless in writing. our debt to gdp ratio is

somewhere between 60% and 70% of gdp today. >> there has been one request in the increase of the debt ceiling. i understand there is another one coming. i do not know whether it will come before the first tuesday in november or thafter the first tuesday in november. i will not hold due to the number. you do not have to go research it. you're smart enough. i have seen you testify enough. if this were the last debt ceiling you could ask for, the final one, and you had to make it large enough for all current and future obligations, what with the request need to be? >> i do not know how to answer that question. it makes no sense for the country and congress controls how much we can borrow every year. we have no control to spend beyond what congress authorizes.

to put -- for congress to put its members every six months on a very difficult vote on whether they should continue to authorize us to do things they have already authorized to do. i do not know how to add to that question. you're talking about the future. >> the lot -- the last debt ceiling increase was for how long and half for how much? >> under the deal we reached last august, we set up a mechanism where congress imposed on itself three votes over a 15- month period. >> what will be the amount of the increase in november or december? >> it depends. congress makes destroyers. congress has to make the choice on, the 1 -- congress makes this choice. congress makes the choice on -- >> you just used the word

unsustainable. if we had one more chance to borrow all the money that we need, assuming current variables, hell big with that number have to be? >> i do not know how to answer that. let me try it a little differently. you have to decide as a member of congress, you want to give congress when you want to vote on it again. again, the debt limit does not decide how much we can borrow. you decide how much we can bar because every year you have -- >> how much debt would we need to meet current and future obligations assuming the status quo indefinitely? >> that i can be happy to give you in writing. >> how about a round number? >> no idea. if congress authorized no additional increase in spending or revenues forever, how much we have to bar? i can do the math, but -- >> $20 trillion?

>> i can do it in my head. >> $50 trillion? [laughter] i have seen you testify before. you are a very smart. would it be a lot? >> it would be a lot. >> interesting transition. >> thank you. every country and every culture, of course, is very different and it is very risky to go looking at different cultures. i do want to ask you about germany. there are some in the congress to believe that the way out of our present recession and dilemma is to impose draconian cuts repeatedly.

even forsake the budget deal which was very difficult to reach. it was reached at a huge south africa -- a huge sacrifice, the loss of our aaa rating. i look to europe. this was a worldwide recession. and i look at the differences among those various countries. the british seem to have adopted something of that approach, the approach to emphasize retrenchment overgrowth. i am intrigued by germany. everybody's favorite example of the strongest economy in europe, perhaps in the world today. i do not understand and i believe we need to come to grips with the theory that they have embraced during this recession.

they're one of the few countries in europe not to cut the budget deficit. i take it was not terribly out of control. i do not know. in fact, they added to their deficit, certainly in 2009 and 2010. one of the few countries in europe to do so. i am truly intrigued by country that did not abandon its working-class, did not abandon its social net, has a national policy that has maintained unemployment low. i know they have some things that are culturally oriented toward work sharing and the rest. they also subsidize employers to keep people on the jobs. but i believe we have to come to grips why this country continues with a country that we

identify so closely. we need to come to grips with their model and how they do it. i have to ask you how has germany maintained itself and continue to grow -- and continued to grow without cutting its deficit. >> let me take a first stab at that. germany, when they had ratification, there were significant problems with the competitiveness and efficiency of their industries trying to interview the two parts of germany together and they made a very sustained and successful effort to increase the sustainability and productivity and competitiveness of their industry, which is to their credit. in addition, as part of the eurozone, they have benefited quite a bit from that arrangement. first because they have a sort

of an export market that they have easy access to. secondly, because the bureau, which is an average of the -- a reflexive average of the strength of the different parts of the eurozone, it is probably weaker than a torchmark would be. -- weaker than a door to mark would be -- weaker than a door tsche mark would be. they also have work sharing policies. in this particular case, there's a question whether that is a good strategy in general. sometimes, they could promote inefficiency because not enough workers are moving among industries. in this particular case they avoided some of the layoffs that we saw in the united states and the unemployment rate remained lower. it is lower today than it was

before the crisis. in turn, that meant that their fiscal stress has not been as great as some other countries. so we have -- so they have had a number of things supporting their economy and they certainly deserve credit for the improved competitiveness. but it is the case that not every country in the world can be a major exporter. somebody has to buy. so that model is not necessarily exportable in itself to every country in europe. >> police time has expired. the gentle -- the gentlewoman's time has expired. >> secretary geithner, the title of this hearing is sovereign debt crisis, causes and lessons learned. focusing on the portion of lessons learned, i have a concern as we look to the issue

of europe which stands for my concern of the bailout process that has happened in the united states. as we look to what occurred in the u.s. with bailouts, i think many people, like me, have a significant concern about conflicts of interest coming issues of lack of transparency, and a lack of openness. mr. secretary, as we look to the auto bailout, you served in three different roles. you served as the secretary of the treasury looking at the issues of the taxpayer dollars and exercising the ownership interests of the united states to the extent that the united states became an owner frequently in the auto bailout produce serve as the co-chair of the auto deaths forced. you were not involved in the gm bailout, but you were leading all of the agencies in one role or another. throughout these processes, you have refused entry has refused to answer questions.

you have provided an redacted documents or disclose information that people have tried to hold accountable the treasury to find out what has occurred, where the tax dollars have gone. one of those issues of sex retirees were 25,000 people lost a significant portion of their profits. the three roles big winners and losers and that is where our tax dollars were picked as losers. if you look at the hardship left in the wake of the gm bailout, the concern is how will we look to the european crisis and whether or not similar conflicts of interest, a taxpayer dollars, and a lack of openness or transparency. as you know that the delphi retirees have tried to get the information and they lost their pensions. the three roles of your self, the -- they have been closed.

documents have not been provided. redacted documents have been provided if at all. most recently, which have the pbcsg saying that you have been involved there is this sense of how do we have this system through bailout for a person like yourself would have the three roles that conflict exists and get congress have no ability for oversight? individuals who lost their pensions, who do not have an ability to hold you or treasury accountable in seeking additional information? this comes at a significant price. we have the $1.3 billion loss in the chrysler deal, the $25 billion or so in the gm bailout. when we looked at the european issue, how can we be assured, looking at the performance of

what occurred in the prior bill that we will not have this issue of conflicts of interest, a lack of transparency, that there will be open as, that congress and people impacted by this will have access to this information? i sit here as a member of congress knowing that treasury is not answering the basic questions about the decision making that occurred with the delphi pension retirees losing their pensions. how can we look to the european issue and not know whether or not our own government will be willing to tell us the decisions that are being made and the basic financial underpinnings of the decisions that occurred? secretary? >> let me try to be responsive. our financial crisis caused enormous damage across the country. not just in the case of delphi, but that is a good example of how much damage caused -- how

much damage was caused. we have made sure that we are as responsive as possible for all your requests for information and we will continue to do that. >> does that mean you'd be willing to release an redacted versions of documents? when you say you have tried, if you send us the documents that were redacted in litigation, you're not being forthcoming. that is not the "here's what your government did." >> we will try to be as for coming as a campaign every action that we took in this crisis has been subject to not just the oversight of four separate from bodies of congress, but i'll of the congressional committees involved. -- but all of the congressional committees involved. >> waiting minute, sir. the one with the delphi retirees is still pending. >> the secretary can summarize his answer. i just want to point out that we have provided an incredible level of transparency over every

decision we made with the taxpayers' money in that context. the rules you just described to me are rules that congress gave to me and my predecessors. there are no conflict in those roles. in fact, we have a very robust set of checks and balances to give the ability and the right to receive a thing we have done. that is what we continue to do and i respect and honor that process. >> the congresswoman from new york is recognized for five minutes. >> i join my colleagues to will come ben bernanke and secretary geithner. secretary geithner was a former new yorker. a think i speak for all of new yorkers when we say that we're so proud of you. i would like to follow-up on my good friends questioning. there is a consensus in this country that, if we had not invested in the american auto industry, we would have totally lost it.

lost it. i do not know about my colleagues on the other side of the aisle, but it is hard to imagine in america that we do not make our own car. i would prefer to see more things made in america with american jobs. and it was at a hearing in this committee where gm testified that we are now the leading car producer in the world appeared they are employing 1.3 million americans and their now exporting the vault. i would call that an american success story. i call that the american dream. if it is true that your the architect of this program, i'm not so sure that your and many people worked on it, but if it is true that you are the architect of it, we should be carrying him around on our shoulders and thanking him for saving american jobs, building american exports, building of the economy of our country. so i would like to say thank you, secretary geithner. now, i would also like to

continue on mr. turner's questioning, which think is a very valid one. we need to learn from the crisis that we just went through. i would like to ask both of you what lessons we've learned as a country and how we will be better prepared in the future. very specifically, how would you compare the actions that were taken by the american government in the face of the crisis that we faced in 2008 and 2009 and the actions we took with the actions that have been taken by europe? i would like to begin with chairman bernanke and then secretary geithner on what was the difference in their response and what were the lessons we learned to make a stronger and preventing it. i would like to close by saying that christina roemer testified before congress that the economic shock of this

particular downturn in our economy was six times greater than the great depression because of the lessons and reforms that we put in after the great depression, we were better able to combat is. hopefully, the lessons we learned now will help us not only to combat it, but to prevent it in the future. chairman bernanke, and thank you for your service. >> we did make a very strong effort to arrest the crisis. we worked with the europeans in order to do that. relative to the history of financial crises, it was the -- with the size of this one, we were successful in stopping it. since then, i think the united states has become more aggressive in strengthening our financial system and i would cite, for example, our 2009 stress test that were highly credible and lead to substantial capital raising in our banking system. the capital in their largest banks have increased by 75% in the last two years, something in

the order of $300 billion. so i think we have taken a lot of positive steps to strengthen our system. there are many aspects of dodd- frank, including order liquidation that have been very constructive we also have to learn lessons about how we got into the mess in the first place. there were gaps and weaknesses in our regulatory system, mistakes by supervisors and regular it -- and regulators, including the federal reserve. i think we will not really have learned the lesson unless we can correct those issues as well. >> secretary geithner. >> the best way to look at what we did is to judge us on the results. if you look at the path of the american economy since the beginning of 2009 and compare that record against the record in europe and the record in the united states and other countries with as financial

crises -- >> thank you, mr. geithner. my time is almost over. i would just like to put in the record that i have been researching you. you have been very positive about the crisis. europe has the ability to avoid the debt crisis. geithner any direct quote -- " the your opinion has the ability to avoid -- the european union has the ability to avoid a crisis." do you agree with that statement, that europe has the ability to solve this debt problem? >> this certainly have the economic and financial resources. their economy is about the same size as that of the united states. they face very difficult political problems, getting an agreement among 17 countries on a path forward. so it will not be easy. but, yes, i do think they have the capacity. >> thank you. >> mr. man from pennsylvania is

recognized for five minutes. >> let me express my appreciation to both of you as public servants for making this commitment that you have at a tremendously challenging time, not just for our nation, but our world. i am grateful for your efforts. of this a, there are many complexing questions. one of the things that struck me in your review of the the totality of the circumstances in europe, one of the places where, in my estimation, just seem to identify more the hesitancy with respect to this issue of the currency swaps, in which we take american dollars and make them available to the european banks and then they will be paid back in american dollars by the central bank. what is the real purpose behind that? is there any distinction from the other imf funding and other things? is it in liquidity issue?

>> it is a liquidity issue, not a long-term level. the longest that these loans are made is three months. we have their counterparty -- it is not the country or the bank. is the european central bank, which we have every confidence will repay. as i said, we have collateral as a currency. so we have a lot of confidence in the financial integrity of those swaps. they have very finished -- they have very good financial benefits to the united states they lend in the united states so it directly affects their ability to make loans to american businesses and households. secondly, they do a lot of lending to support trade globally. a lot of it takes place in dollars. that activity strengthens the role of the dollar is the principal trade currency and is the leading reserve currency.

so our agents are very much involved at no financial cost. we have achieved a significant improvement in funding conditions in europe. because of that improvement, the demand for those swaps is actually going down. so we think that has been successful step. the president of the cbc has made a point in saying that what a good contribution was. >> you mentioned three months. is this a rowling line of credit? over the course of three months, you get repayments and then you make new available credit as well? or access to the -- >> yes. but we approve not just the .rogram, but every single droaw there's never a point where we could not and the program. >> what is the totality -- >> the totality of our exposure right now is $69 billion. of which $54 billion is to the

ecb and the rest is to the bank of japan. >> what is their exposure in terms of other things to the european sovereign debt and other forms of -- >> as our stress tests analyzed, the exposure of our banking system to the debt of the weaker countries is net about zero. even though they hold some such debt as they have -- they have written some insurance on the debt. they have hedges in the other direction that protect them from loss. we are comfortable in the security -- >> where is the strength of the head just coming from? >> the hedges are written by strong european institutions. and we're quite comfortable -- we cannot imagine a scenario where essentially every major european institution -- >> if i'm nodding correcting

your testimony, you did express some reservations and there is one area of exposure, which was the currency swaps. >> no. we're quite comfortable with the securities cops -- security swaps. >> we are also living in a very dangerous world. i know you run these with respect to models. the instability that is currently existing in the relationship with iran and what may happen -- to what extent do these models -- are these models impacted by unrest? would there be reordering if there is significant unrest in the middle east? >> jimmy near banking system? >> yes. >> -- do you mean our banking system? >> yes.

>> we have not done stress tests on -- but we have done stress tests on the worst scenario. a geopolitical event that would cause oil prices to double, as was suggested, it would have effects of that sort and we believe our banking system has sufficient capital to deal with that. of course, it would be very costly to the american economy and to the banks and the financial system more generally. >> thank you, mr. chairman. my time has expired. >> the gentleman from pennsylvania, mr. kelly. >> i would like to build a time back to the chair. >> thank you. i will use it to believbriefly. this has been destructive group we thought we would get you out of here before 1:00. if we get you out of here before 12:00, will you be willing to stick around for a second round?

good appeared before we go to that, a couple quick questions. -- good. before we go to that, a couple of quick questions. and does want to clarify. the european central bank can print an unlimited amount of years, the same as we can theoretically print an unlimited amount of dollars. >> yes. they have only -- >> they have only cheated on that a few hundred *. >> they have kept a good record, but they have cheated on other monetary things. the fact is that greece is where it is because nobody was watching what greece was doing while they're pumping up its debt. is that true? >> i would argue that it was greece and some of the other authorities, not the ecb, that was responsible for that. >> but is not the ecb the arbiter of whether not there --

who is responsible to prevent within the eurozone violations by the eurozone? and ultimately, the value of the debt -- the debt affects the value because, on a common currency, they are agreeing to live within certain guidelines which clearly no one was watching when any countries just ignored the guidelines, at least as to get. >> there was a stability in growth pact which was supposed to limit debt and deficit. it was violated. for political reasons, there is not sufficient enforcement of that. they're trying to strengthen the with the fiscal compacted they have agreed to recently. >> within the obligation we have for currency swaps, are they obligated, not withstanding political pressure, to make us whole? if the year were to drop in half, there would have to give it back twice as many euros to get dollars.

would that be in their jurisdiction or would they have to go back to that interesting vote of some members? >> that is within the jurisdiction of the ecb. i have no doubt they would honor their obligations. >> that is the underpinning of your confidence that these swaps are in fact extremely safe. >> yes, sir. >> i appreciate that. i think the american people have to understand that the swaps we're talking about today are not the swaps were talking about in the aig's era. one more question -- i have the answer to it, but i want to make sure the american people hear it. i think the ranking member addressed it. he'd drop -- to talk about the huge amount of debt built up in this country in mortgages. you may have noticed that the term principal production has been in every question. is it not true that, in europe,

their loans are recourse. in the u.s., almost uniquely in the world, they're not recourse. in europe, they cannot walk away from their loan until they have exhausted all of their resources. in the u.s., you can have a pile of money, millions, and you can walk away from your mortgage if you do not want to do with it. is that right? >> i think that is true in some countries, but i am not sure that that is true across your. >> we did not find any countries that were. the ordinary default in europe is generally that you sign as you would for any personal loan could they take the house and then they come after you for the deficit. >> you did see an increase in borrowing for household, not just in mortgages, but generally in those countries in europe. even with the slightly difference in system, you saw a very large rise in debt by individuals. >> i went to the debt clock.

that may not be the best one, but it is the one we all tend to use because it is on the internet. i looked in round numbers at the time of the crisis. we were at $14 trillion -- about $1 trillion more in mortgage debt than we have today. that shows me that, overall debt of mortgages has fallen, if you will, in relatively small amount. it is certainly less than 10%. what does a really save you from the standpoint of debt-to-equity if the debt is down by that relatively small amount but housing values are down less? and how does that make you feel relative to the security of home mortgages. i realize that that is outside of the scope of this hearing. it is ok if you're not prepared. >> it is about $7 trillion of

homeowner equity lost by the falling house prices. obviously, leveraging in the housing sector is up. but things are moving in a deal leveraging direction as home purchases have gone down and homeownership has gone down and there have been write-downs and people pay down their debts. >> i will now take advantage of this opportunity. way second. let me call on one last first- round member, the gentleman from texas. >> i would like to yield my time to mr. mcenry. >> chairman bernanke, is there a current fiscal -- is our current fiscal trajectory sustainable in the united states? >> no, it is not. >> what is a sustainable debt load for a country such as ours? >> there is no exact number. i think the current levels would

be sustainable if there were kept more relative to gdp. that is an important criteria. if we could, over time, get the gdp to debt ratio down to 75% and then come over time, begin to improve that, that would be much better situation. but as it stands, the cbo projection shows that come under current law, the debt-to-gdp ratio will explode in the next couple of decades. >> explain what happens -- you have mentioned this before, just to clarify -- what happens at the end of this year? in terms of our fiscal situation. >> for a number of reasons, under current law, if no further action is taken, what i turned the fiscal cliff, general first,

2013, as a number of taxes and other things expire, the bush tax cuts, the payroll tax, and the spending side and the sequestration arising from the failure of the super committee to agree kicks in. if all those things happen, i think that would be a very sharp and rapid fiscal contraction that would be a serious a serious negative. i hope congress will take the opportunity to think. when they want this policy to go. >> austerity too fast and spending cuts to san? -- in spending cuts too soon? that is what you're speaking of the? >> a very sharp change in fiscal stance in a short amount of time would have a negative affect on growth. it is important to a cheese

sustainability. one day is a short time to have such a change in position. >> i know you spoke of this. view of the economic spokesmen for the administration and the thing that roll on. i heard you speak about the tax increase. can you speak to this tax the president's budget that he submitted false short of that. there is only one fiscal plan that put this on a sustainable path.

it puts us in a very harsh spiral. it is not addressing the drivers. let's look at it this way. cbo adjusted in assessments of this. if congress were to adopt the policies, which reduce it to a level that makes is sustainable over time. it's so bring the deficits down of a share of gdp. this is for the next 10 years. >> and is there a number of increases in the revenue to government as a historical norm.

>> the go back to where we were, we need to find savings of roughly $4 trillion to keep that objective. we had to hit a $4 trillion target. we were obligated to hold to. the visas of about $3 trillion left to do. we're supposed to do half of that. -- that leaves us with about 3 million left to do. were supposed to do half of that. >> we have medicare and medicaid. it would provide an additional 1.5 trillion dollars. the overall balance is $2.50 a

spending cuts. no one likes to raise revenues. we did not find that additional revenues. we do not think we can justify it. we do not think that is a fair thing to do with the american people. some other differences between us. it most noticeably relates to the longer term and how we bring women's health care to a more sustainable level. we've laid out an approach to reduce it. we have millions and millions more americans retiring.

that is an approach which is very different from the approach she embraced in the budget. >> i think the gentlemen. i would also mention we have the record indicating the cbo scoring. would you like to lead off? >> my colleague asked about the exposure of the united states and our financial institutions.

our total exposure is 2.08 trillion dollars. can you quantify that? said he did not know what i was talking about. >> i am not quite sure what you're referring to. >> since you do not understand it, if i submit this to you, will you check it out? >> certainly. >> i am not a banker. and the is a deep fault sa european central bank has to print more euros, you said they

would pay as back in dollars. what if they cannot? they're going to have to pay for the dollar. the currency has been devalued substantially. would we refinance that dat decks -- that debt? >> they have been clear that they will not be financing it. they have not. their primary commitment was to lower inflation rates. i do not see any necessity that they would prevent inflationary amount of money. >> they make sure that nobody is leaving.

if these continue to increase, they have civil disorders. they are going to have to pay it or it'll explode. they talked to some of the leaders. if we had to recover our debt, how would they repay us? >> they have capital. they have capital u.s. dollars. >> the capital is in euros. get out with they pay it?

>> they are going to have trouble recovering that. inflationary problem is a real problem. how will we get our money back? >> it is a highly solvent institution. it is supported by a whole network of central banks. it is not answering my question. >> it to be absolutely apocalyptic. >> let me follow up with that question. >> bay are forced to leave the european union. they have a cascading effect into italy. they say we're going to try to

keep this. they start printing heroes. how will it we fare in the united states that i would be -- united states? how would we be repaid? >> the money, we have the swap. this is coming down. it is backed by the european central bank. they have gold. they have other kinds of access. it is extraordinary unlikely a situation that we would lose any money. you're talking about a situation

where national governments are involved. i know those governments of their are having political problems. they're not anxious. when you say the 17 other banks and going to come across and helped keep everything afloat, i talk about a worse case scenario. >> a did not say we would support the individual countries. >>, now good to the ranking member for a second round. >> thank you very much. i'm very disciplined.

so many of the people of around the country are suffering tremendously. timothy geithner mention the $7 trillion that has been launched. that is why i announced its. they argue that the social safety net as we know it which provides a critical support for by nation's should be done those republicans.

is being imposed. >> i think a direct comparison is not appropriate. this is a very small economy. they did not have this every share -- they do not have a separate monetary policy. every country needs to pay attention. >> it is very important. we are bringing our deficits to

a more sustainable level. that is an art capacity to do. the gap is roughly 2.5% of gdp. he is a really small challenge. the existing level of benefits are very modest. no call them excessively generous. we have a much larger portion of the risks. icy no comparison in a situation. we are much more aggressive in responding to a crisis. million have many challenges.

>> do they fail to have this t/ it was revised. >> it had no explanation as to how a monumental error had taken place. i cannot imagine them failing to have a firm grasp. can you agree with that? >> it is complicated. i have confidence in our government's accounting system. are there question about whether another numbers were being recorded? >> in the greece, mitigating

financial stress is there a third party. >> can you repeat the question? >> any monetary stimulus in debt this must be down there with their party. >> that is correct. it deals with the deficit spending. >> the united states and europe

have a monetary policy. they have 17 different policies. >> thank you very much. >> thank you. thank you for being here today. i know you're in a difficult position. i been in the same spot many times. we have really gone through some times that were difficult. my question deals more with prime rates. it average somewhere around 9.59 0.8. there are pleasant ones. people sit are you out of your minds?

they are borrowing money. there are presenting to% per month. they will pump more money into the equation. what do you see happening in the future? it was a certainty. they came to us. the driver is a certainty of what the markets are going to be. our and equipment by its bid. what do you see happening right now dollarwise ta?

it does dried dollarwise. i know became difficult for me. we had a single purpose building. you become a difficult risk for us. iwe are looking at great risks n europe. they're looking at mall owner climbers. what do you see happening? where is the certainty going to go? >> the policy has been to try to keep interest rates low. in that respect, if they have benefited from the low costs. we are seeing the purchases are

going back close to where they were before the crisis. that is part of the plan. trying to get people back to work. with respect to the dollar, one definition is the value of the dollar and the currency. in matters for international competition. the dollar has been pretty stable. they are relating to gas prices. we have not had the problem of high inflation that we had in the 70's. i think our policies are achieving support for the

economy. going forward, interest rates will go up to some extent. the dollar will react to the change in interest rates. we think that meeting our mandate a maximum employment and flexibility is the best way to get a strong dollar in the medium term. there are coming back to the market. when i look across the desk, it is the uncertainty of where they

would be down the road. it is so critical. i look for in into prices and i'm watching the value. it is dropping daily. you can lose 35% are 40% very quickly. a watch this happen before. >> i would like to place in the from secretary geithner and the president of the united states. they say that europe is working

hard to assess the problem and has the ability to handle the problem. >> without objection. >> ps. >> thank you very much. i would call this [unintelligible] our banks need to do more. would you agree? >> there is a very substantial increase in capital. what shall we be doing here at comdex? >> they have the effects of the

anticipation of the european crisis. this is how they're managing the exposures. i also looked at liquidity and other types of bank safety. they have a very long way. it to be very costly. better we're much prepared to meet such challenges today. you testified specifically on february 29 about sharp

spending cuts. it is due to the inability of the super committee to reach an agreement on the plan. i would like to place in the record a statement. there is a record on the stimulus for prosperity. >> i am assuming? >> it was in response to this. >> of course. do you think the u.s. government would have been worse off instead of passing the stimulus package? it is an austerity plan.

this proposed plan cut even more to the final agreement. if you want to know who is really trying to turn america, it is not those oppressed economies. it is people demanding that we simulate this pile. even though we're plunging

ourselves into a depression. would you agree? what is your response to the demand that our nation take this? >> did the united states had not put them place the spending cuts, our economy but have been a dramatically weaker. the economy by shrinking at an annual rate of nine%. the plans to stabilize the. we have the growth resume quite quickly. we have some fundamental disagreements. the ryan plan would not just cut

spending too deeply in the short term but erode our capacity for retiring seniors. it would erode what is already very weak safety next. we would not support those policies and not think it would be responsible to adopt a time when the economy is still healing. >> thank you. >> thank you very much. thank you for your incredible servuce. i want to go back to this question that is a central issue. we are having debates about the

level of the debt and the policy we keep pursuing and on the investment side where we have no interested rates and rebuild our economy but have a long term plan for a sustainable future. ion, it has two assumptions. it would cut spending across the board. there is medical research and

eduction. it was sequester cuts and be avoided. the assumption is that austerity is the path to progress. the second assumption is that if we reduce taxes, it will lead to growth. is there any evidence that the assumption of cutting taxes does lead to is cutting some of these expenditures in these items i mentioned, medical, research, education, is there evidence to indicate that will lead to growth and lower debt? >> excuse me, i think the right

approach, without talking about specific colleges -- specific policies again, is an approach to achieve fiscal sustainability in the longer term while being respectful of the need to maintain the recovery at the current stage. nothing that is a balanced approach that can be managed. on the other issues, it is also important not just to look at the size of the debt but to ask ourselves what is the quality of the fiscal problems being undertaken. on the spending side if we are making investments, are they a bridge to nowhere or will the pair returned an improved economic activity and be worth the investment to be made? is it smart tax policy, broadening the base, lowering rates and achieving a fairer and more efficient tax code? i think the balanced approach to fiscal sustainability, but looking at the specific

programs, trying to achieve health your long-term growth is very important. >> the have anything to add on that? this is the central debate in the house, certainly. >> things that happen at the end of this year require congress to confront these things. the choices are and how fast should we cut our deficit? the careful not to do it in a way that would undermine the economy in the long run. what mix of cuts and tax increases is most appropriate for the long run? what should be the role the government helping support investments in infrastructure innovations, and what commitments should we leave in place to are retiring seniors in health care and social security? those are the things that separate us fundamentally. our approach is a balanced approach that phase is in savings over time as we recover

and preserves room to make investments in education and infrastructure so that we are growing over the long run, and maintains a commitment made by republicans and democrats for decades in this country to guarantee of our seniors retirement security and health care security in their retirement. those are things we can afford to do. we cannot put off these fiscal challenges in definitely. that is not an argument to go and dramatically erode -- to make the country stronger and provide more opportunity over the long run. >> i will recognize myself for a second round and tried to be brief and promised to get you out of here before 12:00. chairman bernanke, you alluded to how much of our deficit -- how much of our debt is not really on budget.

if you take over on budget debt and are off budget liability as a percentage of gdp, roughly, what is over debt? >> i would have to get back to you. i think the biggest component of all -- off balance sheet is the unfunded medicare liabilities. 75 years, which is a tremendous number, more than 30 trillion, something like that, according to the medicare trustees. that assumes essentially a continuation of the increased cost we see in health care delivery into the indefinite future. >> at 100% of gdp on budget, we could be at 300% or foreigner% of gdp, including what is off budget. >> if we -- 300% or foreigner% of gdp. -- 400% of gdp.

>> is it not true that america already spends a bigger percentage of gdp than our european allies do on health care? in other words, we already are more generous in health care in the sense of what we spend, maybe not what we get for our money. the secretary is right, more than half of all health care is paid for outside of government. it doesn't mean and what is paid for in government if not already larger than what can the pace for total health care. >> it is true that the u.s. spends more total on health care of the share of the ndp that other industrial country. >> i would like to go on looking at that for couple of reasons. there has been a lot of discussion about austerity and this brings it back, little bit. i am not a keynesian, clearly.

i think we can all understand that all economists tend to believe there is probably a sweet spot, or right balance of public and private spending. as we talk about austerity increase or portugal, in any country, and we talk about austerity here, are we not agreeing that we are trying to get to the same position, whatever that sweet spot is, of promoting growth through not taking it all to the government, and we are only debating when you talk about the rate of austerity, we are not debating where we need to get to. so that private sector can flourish. it is probably similar to where we are telling the countries of europe to get to so that the differences of the austerity we ask for others here and what we need yet to haiti about:how much time we have to get their -- may

be about how much time we have to get there. >> the fundamental reality that will have to live with is, you have to get the deficit down to a point where that stops growing as a share of the economy starts to decline and you have to stabilize at a level that is acceptable. >> i want to follow up on that just for the record. >> it is partly a debate about how fast but also a debate about the composition. if you look good what divides -- >> the left and right will never agree on where government should spend/invest. we will assume that that is true. chairman bernanke, you have provided a little bit of a mea culpa.

you put out a white paper related to the housing and what banks should do. i would like a follow-up in support of the ranking member. the representative from richmond, virginia and others may have chastised because of this. one of things in the white paper had to do with the possibility that banks should essentially put their properties into rentals, that that was an element. the ranking member, very disciplined, talked about principal reduction. when we are looking at what is best for people who find themselves at home region in homes that they could not originally afford, principal reduction as soon as they can no longer or could not when the ball home and for what they bought. when we look at the popery of options fannie and freddie and

the fha, and the banks and their role, would you comment further for this committee on the record to try to understand why these alternatives of perhaps it cannot afford the rent for this home, perhaps that is the best transition, perhaps it is best for the community. the thing that is an element that has not been discussed by the left or the right, and you did put it in your paper. to the extent that it exists, i would like to have it fully vetted. >> the theme was that we needed to attack the housing issue at different points. obviously, if we can avoid unnecessary foreclosures, we should do that, and there are multiple ways of doing that. we did not come down in favor of any specific approach. it depends on the situation. we noted that no matter how hard work, and the country has been working pretty hard on this issue, there are going to be a number of foreclosures that

still occur. people who lose their homes or leave their homes, investors to abandon their properties. it is bet for the housing market, bad for neighborhoods, for in the house is to stand in a row on a street. we still think we should be looking at ways to avoid unnecessary foreclosures, but another part of the problem is the fact that we have so many in the houses, an overhanging supply in the housing market, which pushes down prices and reduces construction. there are various possible approaches to that. we talked about one in our paper. there are other things for houses that should be bulldozed. our point is only that loan modifications have a role to play, but there are a number of different things that could be helpful in the housing market.

>> i will give the ranking member some additional time but i want to follow-up more broadly. a number of cities, even states, have found ways to expand dramatically the amount of time it takes to foreclose on somebody that is not paying. in brooklyn, they got it out to three years, if your papers are all in order, but queen the time someone stops paying -- between the time someone stops paying and the time the institution can take possession. they tried to have fannie and freddie, during the foreclosure process, maintain a home on behalf of the homeowner who is not maintaining it on behalf of the community. i don't want to presume your answer, but would you say these are probably not helpful to either the long-term credit markets or because of certainty, or to the process we

are trying to get beyond to get to where we have a positive market and positive neighborhoods. feel free to answer as you think is appropriate. >> i think delay for the sake of delay is not constructive. the process drags on and a healing of the housing market drags on. that being said, obviously we have seen a lot of cases where servicers have not perform their due diligence, where they have foreclosed in a properly. where there are situations where there are questions about the integrity of the process, we have to make the time to be sure that things are done correctly. >> there are huge numbers of innocent victims in this crisis and there are lots of people who can afford to stay in their homes, and you want to give them the chance to do it.

you want to make sure when you foreclose that the process has complete integrity. i agree with you that the process is taking too long in many parts of the country. if that could be sped up without compromising the other fundamental objectives, that would probably be better for those communities. >> mr. cummings? >> thank you very much. i want to go back to a matter that the chairman brought up and just get your opinion on this. we had major banks there and when you ask a question about how interest rates are lower, let's say somebody has a mortgage at 6% now, and they are under water. he was asking the banks, what

is the negative side? you can correct me if i am wrong, mr. chairman. to make sure that those people have the advantage of lower interest rates. you talked about a number of remedies. did you understand my question? i just want your opinion on that. it seems like a lot of people would fall into that category. >> you are exactly right. that is why it is so important to give people the opportunity to refinance and take advantage of lower rates. one of the most important things we have done over the last six months is to put in place a much better designed program to help people who are significantly underwater take advantage of lower interest rates. we want that to happen on a much larger scale. that program is getting quite a lot of traction right now. there is a substantial increase in refinancing by people who are under water.

we expect much more to happen. this only applies to loans that have been guaranteed by fannie and freddie. we have also suggested that congress consider authorizing the fha to provide an additional program. most people are not sure who guarantee their long and we want to make sure those opportunities are available to everyone who owns a house. >> one last question. one of the thinks that i was looking at was this whole idea that when the bank did their settlement, fha, did not bring them under those provisionally -- they said we don't want to be a part of that. i know you were talking to mr. demarco. was that a concern of yours that we have tripled the incentives

for those kind of things? i am just curious. there is a strong economics case in some circumstances to reduce principal for people who are deeply underwater but can afford to stay in their home with a reasonable payment. that case will be equally compelling in part for the people whose loans were guaranteed by fannie and freddie. we are trying to encourage mr. demarco, who is fully independent, to take another look at the evidence because we think there is a place for doing more in a way that is completely consistent with the mandate that congress gave them and make sure he is protecting the interest of the taxpayer as he helps the housing market. we are working through those numbers with him and i expect to hear more in the next couple of weeks. >> on behalf of the many millions of americans who are dealing with this issue, i would ask you to use your most

convincing voice to try to get him to move, off the dime. thank you very much. >> i want to thank our witnesses. we did get you out pretty close to the 12:00. i would only ask one more item. please, the next time we invite you back, remember that this was a committee that has worked a lot in areas that overlap, and accept our invitation as you so graciously did. with that, we are adjourned. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012]

general john allen testified for

a second time this week about u.s. military operations in afghanistan. tomorrow, he will go before the senate armed services committee and talk about the situation in afghanistan and the u.s. withdrawal plan. watch live coverage at 9:30 a.m. eastern on c-span3 pickwick starting april 1, see the winners in this year's c-span studentcam video documentary competition. middle and high school students from across the country showed which part of the constitution was important to them and why. we will air the top 27 videos. mornings at 6:50 eastern on c- span, and meet the students who created them during "washington journal" each day. congratulations to everyone who participated in this year's competition. >> president obama has been criticized by republicans over rising gas prices. today the president defended his energy policy and talked about solar power and other

forms of renewable energy. we will have the president's remarks later on c-span. the house is debating a portion of the health-care law which includes the medicare payment by three board. house republicans have proposed legislation to repeal the board, which they will vote on tomorrow. here is some of the debate. objection. mr. nugent: madam speaker, i rise todayn support of this rule, house resolution in front of you. house resolution provides a structured rule so that the house may consider h.r. 5, the health efficnt accessible low cost timely health care act of 2011. the rule provides for six hours of debate on this vital issue. six hours, madam speaker. in my opinion the health act is one of the most imperative piece of legislation to come to the house, to the floor of the house in the 112th congress thus far. the bill repeals a particularly egregious part of government takeover of health care.

the independent payment advisory board, or ipab. in case you are aware, ipab is the 15-member panel created by obamacare created to reign in costs. they are un-elected bureaucrats, 15 of them, the majority are not doctors and the decision also have the force of law and go into effect automatically without the consent of congress. we'll get back to ipab in a moment. h.r. 5 also implements long need medical malpractice tort reform. i hear all the time we need to bring down the cost of health care. my colleagues on the other side of the aisle claim that government takeover of health care would do just that, reduce the cost of health care. in fact, president obama claimed it would lower premiums by $2,500 per family per year. we know that's just not the case. since inauguration day in 2009, premiums have risen by $2,213,

almost the same amount the president promised he was going save us. the annual keyser foundation rvey of employer provided insurance from the kverage family premiums totaled $12,860 in 2008, and are now $15,073 in 2011. moreover, c.b.o., congressional budget office, projects the law's new benefit mandates will force premiums to rise on top of that $15,000 by $2,100 per year per family. malpractice reform on the other hand will most definitely reduce e cost of health care. we have seen it what defensive medicine is. cat scans ordered, anti-biotics prescribed, blood tests conducted not because the doctor thought they were necessary, but because he or she was scared of

-- if they didn't order them they would be sued for not prescribing them. departnt of health and human services study said the defensive medicine crossed $70 billion to $126 billion a year. that's billion. c.b.o. estimates that a little more moderate stance putting a number around $54 billion. let me tell you, $54 billion, $70 billion, $126 billion that's a lot of money. in anybody's terms. i have heard from a lot of folks opposing the legislation because it defies states' rights. i have to say i'm particularly surprised to hear so many of my colleagues on the other side making this argument. i'm happy to see they have come to recognize the importance of state rights and state sovereignty. hope that means we can count on them for their support and efforts moving forward to take federal power away from

washington, d.c., and return that power back to the states where it belongs. where our foundingathers envisioned that to be. i want to make -- take aoment to make it clear to my colleagues on both sides of the aisle why this bill, h.r. 5, does not, i repeat, dot not -- does not trample on the rights ofur states. in the moderna, congress has enacted many tort reform statutes to supersede contrary state laws, including recent federal tort reform protecting vital domestic firearms industry. in judicial precedence have led little doubt about its constitutionality. even president reagan who is unabashed champion for the states established a special task force to study the need for tort reform that concluded the federal government should address tort reform across the board. folks are claiming the 10th amendment that states' rights

aren't looking at the entirety of h.r. 5. he they are looking at all the provision that is make it clear that the caps created in this bill only applies to states that don't already have their own caps. these provisions, flexy cap they are called, recognize that any state amount on caps takes precedent to this piece of legislation. that means if a state has $1 billion cap, good for them. let them keep it. it also means if a state has $100,000 cap, in can keep it -- they can keep it, too. if a state decides to pass a law and establish a cap on their own, to change their existing cap, they should go ahead and do it because h.r5 isn't going to do anything to stop them from doing that. h.r. 5 clearly, clearly ensures that the states' right to set their caps where they want them and when they want them. understand trial lawyers won't

like the federal limit, an luckily i really worry about the american people as a whole not just what trial lawyers have to say. i know this y be speculation, but i think that special interest groups and perhaps some of the new converts to the 10th amendment are hiding behind the states' rights argument because, in fact, they just don't want to see their own profits go down. but i fear that the state rights discussion is a red herring that only gets us off the most important issue, the issue that i started off with, the independent payment advisory board. plain and simple, ipab is going to cut health care that our nation's seniors can receive. medicare rationing board which is what this is, will decide the value of medical services impose price controls that will slash senior access to doctors and other health care providers. we see this happening already.

the center for medicare and medicaid savings actually confirm that large reductions in medicare payment rates would likely have serious, serious implications for beneficiary access to care. utilization, intensity, and the quality of that care. and as president obama's appointee as the medicare administrator said, the decision is not whether or not we will ration care, the decision is whether we will ration with our eyes open. h.r. 5 takes that choice away from the administrator, from ipab, from president obama. h.r. sets forth a new way forward. h.r. 5 sets forth a new way forward. a way that says we don't need washington bureaucrats who haven't even practiced medicine telling us what's best for us. we need to sit down with our doctors and come up with individual treatment plans.

a way that actually does something about health care costs by removing frivolous lawsuits from the equation. a way forward that means state rights are still protected while also protecting seniors' rights to the best health care options available. with that, madam speaker, while i support this rule and why i support the underlying legislation, and that's why i encourage l my colleagues to do the same. with that i reserve the balance of my time. . the speaker pro tempore: the gentleman from florida reserves the balance of his time. for what purpose does the gentleman from florida -- mr. hastings: thank you very much, madam speaker. i yield myself amuch time as i may consume. i rise in opposition to h.r. 5 and this billverlooks the rights of injured patients. buit's also an attempt by the house republican leadership to

dismantle the affordable care act. i will remind my friend from florida that there is no example that allows for any of us to have it both ways. this mter violates the constitution and clearly not just those that argue the 10th amendment from a conservative or liberal perspective, it is all of us that feel very strongly that this measure ewe suches the ewe certains the power of states -- usurps of power of states. i'm fond of saying what a constitution law professor at georgetown said, that people seem to be fair weather

federalists and they abandon federalism whenever it is inconvenient to someone's policy preferences. h.r. 5 combines two completely unrelated measures. the first one is the reform of our nation's medical malpractice system. the second one is the repeal of the independent payment advisory board which was established by the affordable care act. please don't get me wrong, i'm fully aware of the challenges inherent to our medical liability system. the excessive cost of malpractice insurance faced by physicians seriously impairs our nation's health care system by encouraging the practice of densive medicine. this contributes to higher health care costs for both doctors and patients, as wl as diminished access to care for

consumers. but while i agree that our medical liability system needs to be changed -- changed, i do nobelieve that it should be at the expense of the fundamental rights of patients including their ability to seek compensation for wrongful injuries. indeed this bill imposes an arbitrary and unfair cap on noneconomic damages that injured patients can receive. such limitations will extinguish our rights and have a devastating consequence for individuals harmed by physicians and medical products. in addition, this bill seriously encroaches on the 10th amendment of the constitution by preempting state laws and i'm not buying the confusion offered in the rules committee yesterday, nor by my good friend from florida. i know preems when i see it --

preemption when i see it, i know the 10th amendment and i know people have stood for the 10th amendment and i need not remind my colleague that countless republicans have made statements regarding this particular matter not fitting within the framework of the 10th amendment's commerce provisions. my republican colleagues like to talk about frivolous lawsuits and unreasonably large jury awards. but i ask the question of the maker of this particular provision on what is his leg worth? it's easy for us on the republican or democratic side, liberal or conservative, to be about the business of talking about somebody's harm and then what happens is all of the lawyers that are the bad people of the world, everybody wants the best lawyer when it is them and their problem that is the problem.

and i ask the maker of the bill, how much is his leg worth? when you cut off the wrong leg, who can stand among us and say that $250,000 is enough? so where did that cap come from? it came from a 1978 prision, $250,000, this is 2011, we're moving fast with costs rising. i ask anybody here or that is within the range of this particular measure at this time, please tell me when your health care insurance went down. i don't know of any example, i've been paying health care insurance r 49ears and it's gone up repeatedly during that period of time and i don't care whether that was a republican president or a democratic president. health care costs went up and i don't think that this measure here is going to bring it down. what do you think about the family in chicago whose

perfectly healthy baby was born lifeless because the hospital team faid to provide them with proper oxygenation during labor and to perform an emergency c-section on the motr? the boy is now 5 years old, suffers from permanent neurological damage and is totally dependent on the care of his parents for all his daily activities. you ask his parents if$250,000 is enough for a lifetime of care. oh, no, then you say, thrust it on the state. let medicaid take care oit. and then what you do under the ryan budget, my good friend, is you say, block grant medicaid, and i saw that movie in florida when they block granted medicaid and it was used for everything else other than for poor people. something is wrong with that movie. what about the judge in palm beach county who had a surgical sponge left in his stomach after having abdominal surgery and had

to wait five months to have it removed? by then the mass measured more than a foot long and a foot wide and the rotted part of his intesten had to be removed skfment -- intestine had to be removed. ask him if a lawsuit is frivolous. each case and each injury is different. it is not the role of congress to decide the fate of these individuals and families devastated by malpractice, by establishing arbitrary limits the financial compensation that they are entitled to. as you all know, the medical malpractice portion of this bill is actually a pay-for meant to offset the repeal of the independent payment advisory board. ipab, as it's referred to around here, is a board of 15 physicians and experts established by the affordable health care act to find ways to control health care costs associated with medicare.

under the act ipab will make recommendations to slow the growth rate in medicare spending if spending exceeds a certain target rate. the congressional budget office estimates that the repeal of ipab would increase direct spending by $3.1 billion over 10 years. $3.1 billion. now is not the time to repeal measures thatty save our nation money -- that can save our nation money and reduce our desit without offering any -- deficit without offering any substitute and that's the takeaway from this. myriends say, don't do ipab and i say to my friends, what do you do? and you do nothing. that's what you do and that's what you've been doing here in the congress since we came here. we have given do-nothing congress a new meaning, rather than dealing with jobs, the things that people are completely interested in, rather than passing the infrastructure

measure that the senate has passed that will deal with -- immediately with jobs in america, we are around here passing a measure and it will pass the floorf the house of representatives, that will go to the senate and go nowhere. so then what ask we do? we did nothing. the congressional budget office alsostimates that thanks to the cost-saving mechanisms in place in the affordable care act , ipab will not likely be required to act for the next 10 years. i heard my colleagues just a minute ago say that health care costs have gone up since president obama has been in office. my mom is fond of saying that if we're going to keep pointing back to the other president, if weay now obama says bush did it and bush said that clinton did it and then clinton said that bush did it and bush said that nixon did it and nixon said that carter did it, then we could just point back to george

washington and say george washinon did it. and get it all over with. rather than continuing this charade before the people are thinking that somehow or another we have the solution here. health care costs have gone up and they're going to continue to gop until we, as men and women in the house of representatives and the united states senate and the american people sit down and decide that this is a solvable problem which will allow us to address those things that are vital in this country. the bill is complete waste of time. it does nothing, in addition to going nowhere, it does nothing to help the american people, it contains nothing to improve the affordable and accessibility of health care and repealing ipab, you want to talk about frolous, that's what frivolous is. let us give the american people what they really need right now and that's jobs. how many times have we -- do we have to say that down here for people to finally get it?

frankly i'm appalled by the hypocrisy of my republican colleagues who keep stating that federa spending needs to be kept under control. but at the first opportunity they wind up rejecting one of the most serious tools in place to actually tackle medicare spending and find ways to make care more affordable. what are the republicans offering to replace ipab? nothing. since the beginning of the 112th congress, the republican majority has sought to repeal as many provisions of the affordable care act as possible. without providing any replacement, listen to that, without providing any replacement and absolutely no long-term solutions. if we do nothing medicare costs will continue to increase. thereby increasinthe burden on millions of seniors, disabled individuals and their families

all across this country. what is the republican plan? what is the plan? it is to replace medicare wh the new ryan budget introduced yesterday, rlace it with some kind of premium something that ain't noing but a voucher syst that would certainly result in increased costs for seniors and reduced benefits. the truth is that the republicans have no plan to reduce medicare and i defy them to present it. if you look at the budget that was released yesterday, it's all filled with blank spaces and i'll fill in the line, nothing, nothing, nothing. so instead of just repealing ipab, let us improve it, reform it or replace it. by doing nothing it's surely n going to fix the problem. i reserve the balance of my time. the speaker pro tempore: the gentleman from florida, . hastings, reserves his time. the gentleman from florida, mr. nugent. mr. nugent: madam speaker, i'd

like to have my fellow member of the rules committee, freshman, rob woodall from georgia, and give him three minutes. the speaker pro tempore: the gentleman from georgia is recognized for three minutes. mr. woodall: madam speaker, i very much appreciate that and i thank my colleague on the rules committee for yielding. i want to come down here and talk about the rule, my colleague from florida's just made a very impassioned case for why he is likely going to be voting no on the underlying legislation. if i understood his comments correctly, i'm guessing that it's going to be a no vote after we have finished six hours of debate on this bill. six hours of debate. which is the kind of debate that a bill of this nature demands. and i'm very proud that the rules committee set aside that kind of time. now, i was fortunate enough to have one of my amendments made in order by the rules committee, as was my friend from florida, but a lot of members were not and i wanted to come down here, madam speaker, to speak to the authorizers, the chairman out there, who -- chairmen out

there, who are sending this legislation to the floor. because what we have in this house is called the cut-go resume which ss if you bring a bill to the floor -- rule which says that if you bring a bill to the floor that's actually going to do some reducing of the federal deficit, if you're going to be bold enough in this house to send a bill to the floor that's gng to reduce the burden that we're placing on our chdren and grandchildren every day, then nothing that happens on the floor of the house, as we try to amend that bill, will be allowed to reduce that savings. so when a bill comes to the floor as this bill has, h.r. 5, that has a very high cut-go numbern it, we're in a box. it cannot be amended with different ideas because those ideas are either not germane, germaneness means that had has to be relevant to the underlying legislation, or they can't cut any additional funds. and so what we had to do in the rules committee yesterday was reject amendment after amendment after amendment that our colleagues offered that we would

ordinarily have made in order here on the house floor in what has been the single most open congress that i have seen in my lifetime, i'm a freshman on the floor of this house, i've been watching this institution, the single most open congress i've seen in my lifetime, but we were not able to make more amendments in order because they were not germane or they violated cut-go. to the rules committee credit, we did not waive cut-go. we complied with the rules of this house. but i say to my friends who are on those authorizing committees, if you want take advantage of the rules committee, in this congress, that is providing more opportunity for more debate and more amendment and more discussion we have seen in decades, you need to be cognizant when you send those bills to the rules committee that we are not inclined to waive cut-go and rightfully so and we are not inclined to waive the germaneness rules and rightfully so. but that means today we are gointo have the narrow discussion that our friend from

florida has on the bill, oh, six hours today, and i want to thank my friend on the rules committee for bringing sh an open rule to the floor and bringing such an expansive rule to the floor and providing the kind of opportunity for debate even though i disagree for my friend from florida, providing opportunity for debate, the likes of which america has not seen in decades. and i yield back the balance of my time. the speaker pro tempore: the gentleman from florida, mr. hastings. mr. hastings:adam speaker, my friend from georgia -- and he is my friend -- pointed out that his amendment was made in order yesterday. i might add in keeping with the notion if you can't have it both ways, he'd strike all the findings and it seems to me that's admitting justification for the authority to pass federal tort reform but it

directly contradicts the same constitutional arguments will make next week in front of the supreme court to reform the affordable care act. i'm very pleased to yield three minutes to my very good friend from new jersey, a member of the budget committee, the distinished gentleman, mr. andrews. mr. andrews: i ask unanimous consent to revise and extend my remarks. the speaker pro tempore: the gentleman from new jersey is recognized for three minutes. mr. andrews: i thank my friend for yielding. whether you're a democrat or republican, liberal or conservative, no matter where you live, i think the number one issue confronting our country is the lack of jobs. it is the central issue of our times, central problem of our times. the american people want us to look forward and work together and solvehat problem rather than looking backward and relit

gaiting political debates. 195 days ago the president of the united states came to this chamber and set forth a series of specific ideas to put americans back to work. one of those ideas was to put construction workers back to work repairing and building our roads and bridges, building schools, wiring schools for the internet, putting our construction industry and transportation industry back to work. we're going to spend six hours debating whether to repeal part of the health care bill, again. we're not going to spend six minutes debating a bill that will put our construction workers back to work fixing our roads and bridges. now, the republican leadership of the house is kind of isolated on this because democrats in the other body voted for a bill to put our construction workers back to work, a republicans in the other body voted for the same

bill. 3/4 of the senate vote to put our construction workers back to work. we introduced a version of that yesterday that says let's do that here, but the house republican leadership won't put this bill on the floor. so instead what we're going to do is have one of our recurring debates about whether to repeal the health care bill. now, people feel very strongly about the health care bill, pro and con, but most people feel even more strongly it's the wrong thing for us to be talking about right now. if there's a bill that 3/4 of the senate voted for to put americans back to work, where don't we vote on that here today? instead, what we're going to do is vote on repealing part of the bill that talks about a committee that might or might not take action five years from now to do something the way

medicare money is spent. i think if you are in this country, what would you like your house of representatives to be voting on today? a vote to put construction transportation workers back to work or a bill that will decide whether a body will or won't act five years from now on the way medicare is going to be run? i think we all know the answer to that. the right thing to do is oppose this rule and instead put on e floor the senate transportation bill th 3/4 of the senate voted r. let's apove it. let's put it on the president's desk a let's finally work to put americans back to work. i yield back the balance of my time. the speaker o tempore: the gentleman from florida, mr. nugent. mr. nugent: madam speaker, i love the hyperbole. i love my friend from florida, his passionate discourse earlier in this conversation. but he was right, you can't

have it both ways. and here's the problem. and their idea of having it both ways, they talk about medical malpractice as if -- if we do nothing, things get better. if we ignore tort reform, things get better. if we ignore tort reform, cost of health care will stay the same. well, in fact, it hasn't. it continues to rise. talk about higher health care costs, but when we talk about that we talk about ipab in particular. 15, 15 unelected bureaucrats. the maximum number that can be on that panel is seven physicians. seven. so they're outvoted already they're outvoted 8-7 no matter what they think is the proper care for a patient. they're going to be overridden by eight other bureaucrats that have notng to do with providing health care to our

seniors. not a thing. it's all going to be about cost, and they're right. that's how you're going to contain costs, by removing the options for seniors to get the medical care that they deserve and that they need. this independent panel is a rationing board. it's going to ration health care out because that's the only way that panel can save money for the affordable care act. it was designed that way. it was designed to keep us, the american people that are going to use that service, that medical care, to preclude us from getting it becau physicns, when they get their payments cut, will no longer offer service. so where are we supposed to go? that is rationing. that's taking away service from people that need it the most. those seniors that have paid into this system for their

lifetime and now are depending upon it to be there when they medically need it the most. this is about -- this is about the seniors that are in my strict. i have 250,000 seniors, a quarter of a million, that rely upon medicare. and if we're going to start rationing care to them, i think it's immal and it's unethical and it's not the way we should be doing it. we should be doing about free market. we should be talking about tort reform that everybody agrees that tort reform, even the gentleman from florida talked about gh cost of medical malpractice insurance. well, where does that come from? doesn't just spring up out of the earth. it comes up for a reason. because the increased cost to ovide medical malpractice and particularly for doctors where it drives up the cost of medical care, is that -- that's

defensive medical care. that's what's driving up the costs, along with the premium they have to pay because the lack of tort reform. madam speaker, i reserve the balance of my time. the speaker pro tempore: the gentleman from florida, mr. nugent, rerves his time. the gentleman from florida, mr. hastings. mr. hastings: i yield myself such time as i may consume. the speaker pro tempore: the gentleman is recognized. mr. hastings: i'll be very brief before yielding to my friend from the rules committee . my friend from florida says that he appreciates the hyperbole. i hyperbole on occasion to find that my friend who is taking positions that going to hurt people require everything from hyperbole to passion to try to get the american people to readily understand. and to demonstrate what we are talking about, my friend just

stood up and said that the ipab board will be rationing. the statute, if it ever comes into existence in the future, specifically says that they cannot ration. i don't know whether my friend read that provision or not, but i am pleased to yield one minute to my friend on the rules committee from colorado, mr. polis. the speaker pro tempore: the gentleman from colorado is recognized for one minute. mr. polis: i thank the gentleman from florida. we're in an unusual situation here where the same people on the other side of the aisle who decry the regulation of what insurance providers have to provide to those they insure across state borders who want to interfere with our requirement that insurance companies not be allowed to discriminate based on pre-existing conditions on the other hand say we need to replace the state tort systems, all 50 of them, with one

overarching federal approach with regard to malpractice. so whereas there is no federal role to protecting patients from being dropped by their insurers, from preventing insurance companies from excluding individuals because they had childhood asthma, because they are breast cancer survivor and many cases because they have a child, while there is no federal rule for that somehow there is a federal role in micro managing the way in -- micromanaging the way in one that is botched by a procedure can seek recourse. i ask my colleagues, not only where is the consistency, but how can we reconcile this with our values as americans? i yield back the balance of my time. the speaker pro tempore: the gentleman from florida. mr. nugent: madam speaker, i have to agree with my good friend from florida on one issue and that's with regards to rationing. you're right. it's not in the act, but, you know, if it walks like a duck

and quaks like a duck, it's a -- crosswalks like a duc it's -- and quacks like a duck, it's a duck. there are things that congress can't even touch. this board is going to say, this is the amount of money that we will pay for this procedure. doesn't matter if that's what the procedure costs. doesn't matter that this doesn't cover the cost of the physician. it doesn matter that what's going to happen are physicians going to refuse to these those patients. madam speaker, that's rationing. call it what you want, that is rationing when you have an independent board that can make decisions in regards to the cost of services that you're going to make or decisions for you to have services by a particular doctor and we see it already today. in my physician's office, it already says we do not take new medicare patients. it's going to get worse, and

this board, while it may not call it rationing, and i give them great credit for them not putting it in the terminology of the affordable care act, it is rationing no matter what you call it. i yield back -- i reservehe balance of my time. the speaker pro tempore: the gentleman reserves the balance of his time. the gentleman from florida. mr. hastings: i yield myself just for a moment. i yield myself such time as i may consume. what you're saying is the ipab board, which may bring down costs, and i might add you just said that congress could not touch it, quoting you. that's not true. congress could change it so long as it stays within the prescribed limits, and that is simply what the law itself says. well, what is the republican plan? as i understand it from mr. ryan's budget offered yesterday, it would be a premium system for medicare. now, you just said that rationing by any other name or you know it when it's a duck and all that ki of stuff,

well, a voucher by any other name is still a voucher. and you're going to tell me that's a good system? i yield to my friend. mr. nugent: well, if you look what the ryan plan says, it also talks about what we currently have today. if you want to keep what u have today in the way of medicare, you keep it. but if you want to go out and buy your own insurance to a select group, you can do it. just like you can today in regards to medicare advantage. but there's a choice that i can make. mr. hastings: i reclaim my time. mr. nugent: i thank you, first of all, for giving me the time. mr. hastings: just to reclaim my time to say that you had it right, select. for example, o governor in the state of florida had one of those select provisions, and he's one of these people that wants us to turn everything over. i had the good fortune yestery of having the chairman of the blue cross blue shields who thinks that this particular measure is something that wou be helpful in his

industry. but that's one thing for another day. madam speaker, if we defeat the previous question, i'm going to offer an amendment to the rule to provide that immediately after the house adopts this rule that it bring up h.r. , the house companion to the bipartisan senate transportation bill, and i'm pleased now to yield to the distinguished gentleman from new york, mr. bishop, my good friend, three minutes. the speaker pro tempore: the gentleman from new york is recognized for three minutes. mr. bishop: thank you very much, madam speaker, and i thank my friend from florida for yielding. you know, time and time again ov the last several months we have heard from republican leadership we've heard their talk about the highway bill, h.r. 7, and they've talked about it as their principal jobs bill for the 112th congress. well, here we are, march 21, 10 days before the expiration of the current extension of the surface transportation bill and where are we with respect to this incredibly important jobs

legislation? we're absolutely nowhere. as of today house republicans have yet to put forward a credible highway re-authorization that puts americans back to work. their only steament, h.r. 7, the -- attempt, h.r. 7, the boehner-mica altogether days is, was passed on -- authorization, was passed on february 14. it passed on a pty line vote with couple of republicans voting against it. then something happened on the way to the floor. on the way to the floor the republican leadership reazed that they didn't have the votes on their side of the aisle to pass it. and what about this bill? well, secretary ray lahood, a former distinguished member of this body, republican from illinois, current transportation secretary, described it as the worst highway bill he's ever seen. he's been in public life for 35 years. the bill was drafted in the dark the bill was drafted in the dark of night without any