i will take care of all of my medical needs except if i get hit by a bus. if i do, my insurance will cover it. i never will become a ward of the state. since they did not do that i think that illustrates from a policy and plausibility perspective that is not what they were trying to get at and if you let them get away with this, kate -- guard the door because they will have the power and it will be able to use it in whatever circumstances where they can cobble together some equally implausible rationale. >> a little bit off topic but what did you think about the arguments with respect to the states being coerced into the medicaid portion and how did that go on the last day? >> i was representing the

private responded so well i had an academic interest in the medicaid stuff. it was purely academic. the dilemma in all of this is as the federal government becomes more and more involved in things we think of as traditional state regulation, most obviously health care and the like, the states do become dependent on because technically you're not forcing them to do it you're just making them an offer they can't refuse like the god father.

to the supreme court talking about how men need to be able to pay for their wives breast cancer and people are on dialysis machines as if the issue was throw all the sick people out on the streets or hear what they were doing and even the more liberal justices were sitting there with their mouths open. so i don't know if that tells you one thing or another about the medicaid argument but it was a relatively odd moment during the argument. >> what are your thoughts about the the state of the union

address several years ago as well as his post argument comments? >> look, there's an obvious distinction between the citizens united state of the union and this. he's already written citizens united. so if you're going after ghieses i wouldn't do it while they're writing the opinion. because there's always the chance that they might be changing their mind. so i don't know what. there's a moment, an odd thing for the president to do. i was sitting there going, keep talking. because i think at the end of the day it can only help us at the end of the day it's kind of silly. right? this is going to have -- i don't think it will have any effect. and to the extent it does it will be negative and we don't need -- we've heard your greefswefment don't need you lecturing us in public particularly when your lecture is mar bury madison was wrongly

decided. [inaudible] and someone in your office guided me to the goldwater institute which was writing a brief basically on behalf of states that have passed health care freedom act. so i want to thank you. it seems to me that the tenth amendment is a very important piece of this puzzle because you have to, like any statutory or contractual construction, you have to read the four corners of the document. so if you're asking yourself what is the limit on congress' power under the commerce clause of the necessary clause, the tenth amendment has to be read into that but it's my understanding that there's no real expectation that the tenth amendment is going to be a big

part of the reasoning. is there any comment you can make? >> it depends. in one they're saying the tenth amendment won't enter into it is no criticism. the tenth amendment says that every power not given to the federal government, ie the commerce clause, is reserved to the states and to the people respectively. so in my optimistic days i don't think they'll get to the tenth amendment because they'll say this power was never granted to them so we don't need to get to the tenth amendment. but it does come in this way. i think if the justices think that maybe in some circumstances we could require something that regulating nonmarket participants, there is the necessary and proper clause and as justice sclalia emphasized it says necessary and proper. even if we thought in some ways was orks surely compelling them to transfer their property would be analogous to

compelling state government employees to enforce federal law. they said it might be ok but it's not proper because it's -- you've never used it historically and it really does exceed the kind of powers that had gone to the federal government. and the government's response was sort of, oh, well that's when you're taking care of states. that's the problem when you're command deering states. and we said no command deering citizens is exactly on the same constitutional footing and u one indicia is the tenth amendment reserves the powers to the states and to the people so that liberty is just as problemcal. [inaudible] so the question is what would

my opinion look like if i was writing something in favor of the law. it would be an extraordinarily short opinion. it's not -- i guess it would look not unlike the solicitor general -- people are really sick. we've got to do something. and these damned states just can't take care of these sick people so let's ignore the constitution. usually they're not quite that candid. there are no legal arguments. and if there were i wouldn't be telling you. if there are no legal arguments in support of obama care and that is why it is not a coincidence that congress for 230 years has never tried this before. they've had millions of opportunities where they -- all kinds of crisis. the height of the new deal. you know, nobody required you to buy bonds during world war

ii and that was because it was literally unthinkable that in a nation post lated on the principle that people are sovereign to the government, that the government can command year the people to do something in that they're merely required to salute and say yegs, particularly when it's the federal government which by definition had its powers limited and enumerated precisely because they couldn't engage in this sort of tyrannical police power. and that's the debate from the solicitor general's perspective, he kept saying, look, the way ensact a much more efficient way of getting money into the insurance companies' coffers than if we had followed this commerce clause thing and conditioned access to health care providers and then made you buy insurance. and i was like, yeah. that's exactly right. i can't conceive of a system

more badly equipped to force citizen a to give its property to citizen b than the system the framers came up with that reflects the fact that the framers didn't want to make wealth transfers. they wanted to make it impossible. so it doesn't reflect in e flaw in our reasons. it reflects only the fact that the example of the framers were trying to provide the federal government, the powers they were trying to deny was wealth transfers and that's why they didn't give them the police power. so you can use that as my dissenting opinion. well. i just wowed you with my eloquence so there's no further question. with that, thank you very much. enjoy your day. [applause]

i want to remind everyone about the election law seminar tomorrow. it is not here. 2001 k street. if people are not coming to the workshop tomorrow they need to turn their forms in before you leave today. those coming to the workshop should keep them and turn them in tomorrow. before we adjourn to the reception, i just want to recognize david warrington here on behalf of attorneys for ron paul. david. [applause] stefon pass teeno. and then chris land ow a partner of kirk lan and ellis. the great dick riley.

the rad ow ski. and michael morally associate general counsel. romney for president. and with that i want to thank -- sorry. [inaudible] >> there you go. you just did. tune in this weekend on the voter id issues. with that i want to thank everyone for coming, i want to thank our sponsors, the gentleman who lent me his i phone charger. we'll see you out in the foyer for the lawyers for romney session. >> next, imf managing director

on this weekend's meeting on the imf and the world bank. then live at 7:00, you're calls and comments on corl this is 35

minutes.

>> welcome. let me introduce you. we are on the record this afternoon. i will ask you to identify yourself by name and affiliation to keep the questions short if you can. we'll try and take as many as we can. let me turn to the minister. you have to commue kay i believe the minister will give a few opening remarks followed by madam la gard. >> can you hear me?

thank you. i'll give you a very quick sense of discussions yesterday and today. we have joint press conference for the g-20 where we announced the strengthening of the demrobal safety net by building up resources with the fund. that is an important step forward. today beyond that announcement yesterday and today the focused principally on the real solutions to the crisis, the sustainable solutions out of this crisis. that the safety net or the fire wall is meant to support. we talked briefly on this at yesterday's press conference. that was our main focus. it was about the real theater of policy action which is about fiscal reforms and actual

reforms. not just in euro although that's obviously an important focus of our attentions but also the united states as well as more generally. amongst all international economies. there was a very strong consensus in our discussions on the need for everything that we do to be supportive of medium-term fiscal consolidation particularly in the advanced economies. and that applies both to europe and to the united states. the first is this. that everything we do have to be focused onie cheaving consolidation. and in that regard there was also consensus that the steps to be taken not only the steps that involve fiscal adjust ymentsd, reduction in fiscal deficits and sustained period

of running improved primary balances or structural balances in government budgets. but also equally important the need to restore growth over the medium term. growth over the short term is weak partly because of the adjustments which we have to go through on the international economy and especially the advanced economies but what was really critical in all our minds was to get back to normal growth over the medium term and preferably sooner rather than later. in other words, within two to three years to get back to normal growth if possible in as much of the advanced world as possible. because if we don't get back to normal growth, if we don't get g.d.p. back to its potential levels then fiscal sustainability is not possible either. so it's not just the budgetary reforms tax reforms and

spending reforms that are important but also the growth reforms and that involves the way we craft fiscal adjustments but very importantly the goals of structural reforms. in order to bring confidence and investments back into our economies. there's also the discussion of how they can play a complementry role in this adjustment process in the advanced economies. so then the main focus is about medium terms of sustainability and very importantly about bringing growth back. >> thank you very much. i would like to just again by telling you how important it is sometimes to have a good chairman and i have to tell you that he was just a -- he is just a superb chairman and this should be recognized in front

of you. he was terrific and took us through a long journey where we discussed all the issues that he has indicated, substantive issues. and we talked a lot about certain regions and countries, the euro area, the united states of america, the right balance between emerging market economies and other advanced economies. and all of that from the perspective of the medium term anchoring that is so needed both for fiscal policies and for the purpose of stimulating that growth and the job creation that is so much needed. so it's not always easy to conduct those discussions with such a large commurm of -- number of constituents in the room and it went extremely well. the second for those of you who are familiar, traditionally, and you've seen photos there's this huge big round of tables and it's relatively hostile in

essence because everybody is protected behind their tables. well, we did it a different way and we had chairs which was much more fluid, people were much more in each other's face and posture, which was extremely good for the dialogue that we had. so it was lively and just to give you a little bit of the taste of the discussions, because the form and the substance rarely often interlink and that certainly was the case in the course of the discussion. so in terms of momentum, in terms of positive signals, we had a lot in the last day and a half. very frank, very respectful but true to each other as well. and focused on medium term

necessary achievements. i think that if it was two concepts that were shared across the board it was structural reforms and discipline. and that also underpins the medium term growth and fiscal conversation that he was referring to. now, to top it off i would say because structural reforms are long standing initiatives and the anchoring of fiscal consolidation and expectations are also difficult things to do, it's nice to have a big umbrella or a big cover, however you want to call it and that was the initiative of yesterday to put them together for the purpose of that buildup of the resources. and flinal, on sort of more domestic and internal issues

for those who are experts in imf issues, we had a strong endorsement of the completion of the governance reform that is due to be completed for the tokyo meeting which will be in october 2012, we have still a little way to go on the quota, we have a long way to go on the reform of the governance. but there was this strong consensus and you will find it in the commune cay to move on with this reform. equally, there was a strong endorsement of our determination to improve constantly our surveyance which is one of our missions which is bilateral traditional and ask be improved or whether it's more multilateral and there was strong endorsement to just continue with that and to complete the reforms that are

needed to that effect. very positive. the urgent question, the burning question. >> thank you. i want to begin with the lady right in the front. thank you. >> thank you very much. congratulations for a meeting of great success. my first question as managing director, do you think it has been achieved? and it seems to me that the rich countries still want to link contribution with governance and cultural reforms. do you think their strategy will be successful to push up the governance and reform? and my final question about china. how would you label china? if not substantial undervalued?

thank you very much. >> so three questions. one question please from now on. thank you. >> the momentum, the dynamic that was created in the course of this meeting and we will hear more feedback because it's on the spur of the moment you tend to be quite upbeat about what has been achieved and then you have to sort of let it sit a bit and wait for membership feedback. and we will seek that feedback. we want to understand whether they were satisfied and whether they've seen that collectively we have achieved what we could achieve at best both in terms of form and substance. but i feel that moment was clearly in the room. in the course of the meetings.

on the issue of the sort of conditionality, it was never expressed as a conditionality. it was a keen determination on the part, but maybe more so, from some of the emerging market economies. but there was also a definite commitment to participate in the discussion. and on the last issue that you've raised this is not completed yet. it's a matter that is under review and that our team both as research dr the various teams working on this initiative, the xl factor report will come up later but we have not completed the work on this. but we have signals how important that variation of the upper band had been and how strong a step it was in the right direction. >> thank you. let's take this question.

>> thank you. one question for madam managing director and one for the chairman please. some finance ministers have said that there are additional safe guards for the use of the $450 billion resources. can you say exactly what those additional safeguards exactly are? it's my understanding that there is exactly no change to the rules and regulations. and secondly, the draft statement said that the advanced economies should be

prepared to exit expansive monetary policy. but i see that that has been taken out of the final commune a. can you say why that is? >> you're absolutely right. there's no change to the article. but what has been clearly reminded during the course of the discussion is that number one those plaltral loans which are to be drafted and signed from now on do not form a special fund or covers that would have eu label on it. it's all members of the imf. so that's principle number one. principle number two, it must be used under the strict exact even handed, nondiscriminatory

demanding terms that we have for all our programs. that's the strength of the imf. it's the condition at, the review, the monitoring and the sequencing of the lending that goes with it. >> what chris teen just said. you'll notice that there were a fair number of european countries and nong-20 countries that decided to participate in the resources. and it is very important to all of us that any use of these funds be accompanied by the same strict conditionality and rigor that the imf is associated with in all its programs. that was there are important to the british, very important to all of us. contributing to the fund to use as it sees fit around the world. and whoever the borrowers are, whatever the causes, it's got

to be the same standards because the credibility of the fund is -- beyond attempting to bolster throughout this effort. on your second question, i wouldn't read too much into the final editing that goes into the statement. the statement does emphasize, there's a very important notice in the statement on monetary policy. it doesn't just say that monetary policy needs to remain accommodative. it says it needs to remain as long as inflation prospects remain anchored and assist. and that's a very important aspect and it captured both sides of the atlantic as well as the emerging countries and we spent some time discussing this in the context of the emerging countries as well. we're all pretty much of the same mind on the importance of ensuring that inflationary expectation reese main anchored in other words remain law and

in check and if there was any indications, any trends indicating that we are likely to lose control of the inflation further down the road there was a general sense that monetary policy being very easy would no longer be adviseable. so i think there's a good meeting of minds of that. >> thank you. let's switch. the lady again over here on the right. thank you. >> the imf has said it's ready to adopt some of the bailout programs if, in case of needed. and my question is, do you feel the need to adopt the bailout program to portugal sometime soon and it's not if you think that portugal is on the right track? thank you.

>> you know, the portuguese program has been a way for, what, less than a year now if i recall and it works like any of our programs. it belongs to the country. it does political endorsement and the portuguese government and opposition did a great job in that respect because they came together as members of the imf came together yesterday and today to endorse it. so the program of portugal is negotiated with the imf but it's their program. we conduct regular review and the mission team on the ground they work with the authorities to make sure that the target has been reached within the timetable that has been adopted and agreed between us. so i don't see any reason for any change to the portuguese program.

[inaudible] >> i think the review conducted certainly concluded that the program was obtrack. >> yes, sir. >> coming from a part of the world that really is reshaping the global economy through thrift and competition and then productivity, do you feel that the industrialized world, the old industrialized world, the old economy vrks a realistic sense of the adjustments their societies are going to have to go through to take advantage of this two to three year window you talk about? and one of the implications if they don't kind of get their act together in this reasonable medium term framework? >> well, to be quite candid, i have a lot more of a sense now than i did three to four years

ago and i think i am accurately reflecting the discussions we've been having when i say that across the room amongst the advanced counted rizz, the term you used, the western economies, there's a very strong resolve to get to the heart of issues of competitiveness, thrift, rebuilding of household and government balance sheets. very strong resolve. and frankly it's quite courageous politically what they are doing because in very strong expectations built up over the years for more of the same and it has taken tremendous political courage, particularly in the last year, to begin to switch course and to painted a vision that leads to a better future. and we are all very supportive of that. we know it's going to be a long road.

this is a multiyear journey and there will be pit falls along the way, which is why chris tin's umbrella is important along the way. it's going to be a very challenging journey with politics intersecting with economics and i'm a lot more confident now than i was a few years ago and i would finally just add that one of the thing that is we will have to also watch out for in the nonwestern part of the world is hubris. we'll have to avoid thinking that we've got it all right and that the savings policies or competitiveness policies, that we've discussed the new golden eek lick brum. there's a lot of -- equilllibbreem. there's a lot of learningsing to do on both sides.

>> thank you. >> good afternoon. how will be world with low income countries, especially in latin america, do you think these countries will be able to make a difference? >> we don't talk enough about the work that the fund does with the low income countries. of the 48 programs or so that we have around the world, more than half of them are with low income countries. everything is proportional but we do a lot of work and we give a lot of technical assistance, advice, capacity building for them. so we do as much as we can to help the low income countries. we will work a lot on the countries in transition from the northern arab spring

countries and it's a real focus for the fund as well. so i am confident. if you look today at where are the countries in the world with double digit growth you will find them in low income countries, and about two thirds in africa. >> thank you. >> i have two short questions and easy questions. the first one is does the imf in discussions with cyprus for a bailout program? the second question is did you think about the possibility that the practice against the greek program to have the majority in the greek

parliament on may 6? thank you very much. >> you know, our people talk to , they contact all the time all over the world. so i'm sure that they are in discussions with anybody in the mediterranean. north, south, in between. but a discussion with any program with cyprus, not to my knowledge. and the second one, i would be the last person especially today to preticket the outcome of a political election. >> ok. i'm going over here just the lady at the front. >> thank you. i'm from egypt. i want to ask a, to how the imf support countries that change their policies. and what about the agreement with the arab spring countries

especially in egypt? thank you. >> well, i'll share a secret with you. which i'm sure will be well kept. we have a commitment tot arab countries in transition, a commitment that by our annual meeting in tokyo we will have several programs in place to help them navigate the transition. it will not be enough. it will require other supportors, donors, partners to help finally and in trade opening as well. and if i have to tell you i think relative to other parts of the world, it's probably the part of the world where we give the highest, largest number of technical assistance, hours, days, man or woman hours in all

sorts of matters, public finance, taxation, all sorts of fields where they seek our assistance. you would be surprised. dozens and dozens of technical assistance. we have fielded over the last couple of years. >> i think we have time for a couple more. the gentleman, in the pink shirt. >> you mentioned in the coming week that the work should be significantly in hand politically and that the imf will take into conversation the exchange policy of the member. >> very pointed question. it's one of the components that we would be looking at clearly.

there are others but it's one of them. yes. >> ok. over here. >> thank you. i want to ask because even in the case that the members collective responsibility to a void protectionism. [inaudible] in the exchange rate. because some countries have rates, some countries are using cultural exchange rates. some have problems of the capital flows. and there is an increasing use of the exchange rates.

what are you going to do? >> we discussed exchange rates yesterday and today. i would say compared to a year ago, we had a good meeting of minds, pretty much a consensus amongst emerging countries and advanced countries whether we're talking about china or brazil or anyone else. we all agreed that there had to be some greater flexibility in exchanges rates over time. we agreed that we were getting there. and we also agreed that from time to time capital flows can be very troublesome. the fund has shifted its thinking on the matter and we've all shifted our thinking as to what is a sensible toolkit for emerging countries when faced with volatile capital flows. so there was a recognition that in instances where you face the

volatility of capital flows some form of management of those capital flows could be sensible. in other words, where it's not die to your own domestic policy being out of synch with your economic fundamentals but simply because of the global capital markets some sort of capital flow management is sensible. these were statements that were agreed to on all sides so i found that quite encouraging. we have moved some distance in the last year on this issue. >> just to comment on that. there is work that will continue to be done at the fund so that we can really analyze in depth the relationship between movement of capital flows and monetary policies. that's another matter which was of interest. and there is not at this stage definite evidence of a relation between the two. since you are from mexico let

me say also that we have had an extraordinary collaboration with the mexican pet presidency and i'm sure it's in no small part due to president calderon's really focus on support on the g-20. this has really been a great work experience for us. >> i was pointing to this gentleman, the second row. >> thank you. a question on economic reforms. will the imf prefer to see a lifting of u.s. and world economic sanctions in order to push forward the financial and economic reforms that we're seeing now? aside from providing technical assistance what else would the imf be looking to do in the months and years ahead? thank you.

>> your question about the advanced economies, u.s. and europe? oh, den mark. well, i will tell you something. we don't brag much about what we do and on this particular case others would have because we have been behind the scene discreetly helping the myanmar monry authorities particularly in relation to the most recent currency reform and we've been working with the central bank of myanmar on that very, very actively. it's a tribute to them that they have made this change it was done april 1, if i recall, and it has been so successful and they are just going through the process. they are going to continue to

provide any technical assistance that they need. this is happening on the daily basis as we speak. [inaudible] some of the sanctions have been lifted already. there is a momentum that is clearly initiated and my dearest hope is that it continues. >> one last question. let me use the moderator prerogative. as you know, we bring several journalists to washington imf fellows so i would like the last question to come from one of our fellows. right here. thank you. >> good afternoon. first i would like to ask you how the euro crisis will affect the emerging countries in the southeastern of europe like the balkans and macedonia. and what are the main risks foor these countries? and the second one, macedonia has an arrangement with the imf

for 480 million euros from last year. our government is borrowing money on the commercial markets. is it the right policy to borrow money and to spend it the main part for social transfers for pensions and for service for administrations? and not but not for capital investment? and do you plan to come to visit our region in macedonia? thank you. >> on the consequences in suren europe or it's more extensively central eastern europe and the large periphery of europe, it's clearly the sort of immediate circle that is potentially exposed which is why it is so important that the europeans do what they are committed to do that they deliver on their programs that they move on with

their structural reforms as well as stick to their commitment to each other and for some of them to the larger community which is what we are seeing at the moment. so that's really important to them it's important to us it's important to the likes of macedonia because the linkages between countries of central, southeastern, southern europe and the core of the euro area is extremely important, particularly the banking channels. in those countries there are lots of branches and subsidiaries of euro area banks and it's generally those channels that are the contagiousance channels so i think there's a clear community of interest in the euro area doing what it has to do. on the macedonian program, allow me to be a little bit out of my depth because i'm not exactly sure where they stand on the review of the program if you know more than i do, maybe

you should fill in. >> to borrow from the commercial banks. >> [inaudible] the government spending that money for social transfers and administration but not for capital investments do you think it's the right policy at this moment? >> i don't want to pass a judgment. i have not verified with the team. so i'll reserve my response to your fellow journalists and thus will get back but we want to double check. >> thanks, everybody.

>> on "newsmakers," thomas donahue president and c.e.o. of the chamber of commerce marks the 100 anniversary of that organization.

>> this year's student cam competition asks students across the country what part of the constitution was important and why. >> i [inaudible] >> 100% disabled veteran. i've been coming here for maybe 30 years. >> fight for our post office. several members of my family work for the post office as long as i can remember. so i'm not sure what they would

do. >> there's something that is so inexplicitly powerful about a [inaudible] other human beings. >> i read somewhere that 60 million americans don't have access to internet. what are they supposed to do? /♪ >> the united states postal service enables you to send a

hand written note from florida to california in just a couple days. our founding fathers recognized the need for a postal service. however, the increasing popularity of the internet the post office has suffered some heavy blows due to part it could be attributed to the government front load the retirement fund for the postal workers. many individuals throughout the country expressed concerns about the potential post office closing how it could impact this. /♪ >> basic services rendered getting there for people. especially in light of more services. i think about this and the presence of how much money is wasted in war and how we send

out like 60 billion. this is not actual expenditures. but in the iraq and afghanistan war. 60 billion as opposed to 2 billion loss over 5 years for the u.s. postal service. >> the more important question is what would happen to the rest of america, the other 99%? particularly rural and small town. does anybody think that you would be able to send a letter from the florida keys to nome, alaska for 44 cents if all of a sudden government wasn't there providing that universal service, a mandate? >> i would may i help you? >> not all americans depend on the post office for their means

of communication. >> we have a lot of things that need cutting but post offices are not among them. there's something special about a letter we all like to get one. an e-mail on the other hand has all the charm of a [inaudible] >> understanding the importance of the postal service started a nationwide movement and has been teetrd in the "washington post" and new york magazine. we sat down with him to discuss the various reasons. >> many of the post offices that they want to close are in inner cities and under

developped neighborhoods. they tend to serve populations that tend not to be on the internet, that are seniors who walk to the post office, who are dependent on the post office for their medicines, social security checks. i was shocked to learn some people don't even have a bank. >> the post office is especially important to small isolated communities. we traveled into the heart of the floridar demradse to visit the smallest post office which services a population of 11. this converted toole shed keeps the people connected to the outside world. this stretches across three countries totaling 132 miles long. >> a decision needs to be made.

but as soon as you say something like that about now i think environmentally think of that gap that's being wasted. time that's being wasted gas that's being wasted pollution that's being wasted from how many people that now have v to move instead of one unit. think of the environmental impact of the i think it's wiser to have one postal service in one location as opposed to now all people having to go out. >> if you have a post office, that has 200, 300 employees, it does affect those employees and their families and the businesses around that post office. the post office is the core of about a $1 trillion economy in this country employing about

million other people. and as these plants or post offices close, a lot of the community around those plants and communities will be affected. >> it tells congress they have the ability to do something about this situation. the post office is one of those things that americans need on a daily basis to provide those services and without it not sure how a lot of americans will of rate. i can't imagine life without it.

following the money in afghanistan and finds corruption from top to bottom right into the hands of the taliban. >> i was in one meeting where the brigade commander, an incredibly effective guy, this is not long after president obama took office and they were out there saying ok we are going to give you money, win hearts and minds, nation building. and colonel howard said don't send me any more money. send me contract officers to do

this. i don't need more money. on c-span's q and a. robert careo, to coin side with the release of the passage. in the years of lyndon johnson his volume biography of the 36th president. discussing how much time and effort goes into a congressional investigation. and later robin wright.