that is not in the federal law. in sb-1070, we say you have to have reasonable suspicion. those are the basic things, in a police academy to every young recruit. civil rights -- the proper respect of citizens. it is demeaning to law enforcement that we would assume those things go on. he will have exceptions to every law. that is demeaning to law enforcement if i might, -- enforcement. if i might, sir, when you talk about the police -- police chief's not supporting sb-1070, what did support is in nine out of 15 shots, 10,000 officers, 23

agencies. every single organization that represents boots on the ground supported sb-1070, and worked with me to make sure that we created the kind of exceptions they could make when doing their jobs -- doing their jobs when necessary. we did not regulate. that is an exclusive responsibility of the federal government. i agree with you, mr. chairman. he enforcement has never been exclusive responsibility. if we do not hear this about drug laws, gun laws, a bank robbery, or other federal crimes we and 4 cents a daily basis. if congress wanted to -- and force on a daily basis. congress has never done that. there has never been a pre- emption. it has always been a collaborative effort to secure this nation. that should always be our priority -- the rule of law,

dignified, compassionate, respectful, but not apologetic for enforcing our laws, securing our borders. >> i appreciate that. i want to give you the opportunity to state your case, because obviously you are out- numbered here. >> that is years away the case. >> i do want to ask the question, if the border were completely secure, and the government could agree that we could show that no new people were crossing the border, you would still want sb-1070 to be in effect people that were already here would leave, were apprehended, were deported. >> let me give you the answer. again, we are a generous nation. we allow more people in this country than any other developed nation, but yes, the laws must

be enforced. there ought to still be arrests and deportations. the largest gangs might not be illegal aliens. the kidnappers, the drug smugglers -- you can not carve out a little section. >> i appreciate that, but your answer is yes. >> yes. >> ok. in trying to promote self- deportation, do you make distinctions if the person has been in america for 20 years, has u.s. citizen children, or is brought here as a minor? >> federal law does not make any distinction. that is a relative of -- regulatory function. >> do you believe that many national political leaders agree with the policy of self- deportation, or do you have a minority the of -- review? >> i have a majority 73%

supported sb-1070. it is still, by far, the majority in favor. 34 states have had contact with have indicated their desire to test. >> you believe it is the mature -- majority opinion of your party and the country. >> by far, my party, but the majority opinion of america, from coast-to-coast. >> i want to talk about racial profiling. many critics say is unconstitutional. i want to try to break down the law step-by-step with you, to understand your thought process. you are the author. nobody knows this better than you. first, to be clear, as you said, to sever all its, "you

know why sb-10 was britain, there is nobody better -- was written, there is nobody better to explain this." is that accurate? >> yes. >> let me go to the section sb- 3. i want to show you a blowup of the training factor. i will highlight the view. -- a few. it says dress, demeanor.

>> the one that raises my curiosity, is dressed. what does an illegal immigrant dress like? >> they worked in cooperation with ice to develop a profile. >> explain to me, do you think dress is appropriate? >> this is training material, not part of the bill. >> from the arizona police. >> right, not a part of the bill. >> do you think dressed is an appropriate measure? it is not inappropriate, what does any legal immigrant dress like? >> mr. chairman, when you train a police officer, i have been in

this business for a long time. it is a constellation of issues that raise the level to suspicion of probable cause. it is not any one thing. this is a list of things that lead you to ask questions. i know questions are a dangerous thing. >> sometimes questions are a dangerous thing because they lead to profiling. in your experience, you have lived in arizona your whole life, i believe? >> yes, sir. >> due to legal immigrants dress differently? >> i do not want to be confrontational, but i want to tell you this is a list of things to look for. they are trained by ice. this was ice training. if i am responding to a bank robbery, and i have a description biradial of all

white male, average height, white t-shirt, dark pants, and i see a white male, dark pants, i stop them, and i have a pretty good reason to rescue questions. when i find out he is not the guy, he gets released. you have to respond to reasonable suspicion to do your job, mr. chairman. this is just a list look for. >> i do not believe ice sanctioned the word dress. let me ask you this question, instead of going through these criteria, and other criteria, why did you just not say, and again, this is the arizona police, not your criteria, but why did you not just say that everyone who was stopped by police has to be checked for in

legal immigration status? why you require the police to have opinions about whether the person is an illegal immigrant first? doesn't the way you wrote the law either require were certainly and dave towards racial profiling? -- invade towards racial profiling? >> under the u.s. constitution, we have the equal protection clause. i knew those issues would be raised by open-border folks that are against any enforcement. we have been sued and everything we've done to of voter fraud, to go after a legal employers. no matter what we do, we are attacked for simply enforcing the law and trying to protect american citizens and jobs for americans. we knew these questions would be asked. we simply wrote the bill to

preempt those arguments in trying to protect their rights. as a civil libertarian, i'm a believer that you have to do a reason to do something. that is why the bill was written >> let me ask you again, why would it not have done just what you say, rules of law, and not discriminate, why would it not be better to say that everyone stopped by the police should be checked in? you have seen in the regulations that it is problematic. >> we made the proper exceptions. if you have an arizona driver's license, the requires proof of citizenship, you are automatically exempt.

all we wanted to do in the bill is common sense. we teach officers to have common sense, respond to reasonable suspicion. i do not want to hold a family up while i'm asking silly questions if there is no reason. this was based on reasonableness, mr. chairman. >> i guess many would disagree with that, including some of the panel. let me ask you something about miners. what documentation is a minor supposed to show the police officer to prove he or she is a u.s. citizen? >> it is different for minors. if you are an adult, you are required to have your identification with you at all times. again, reasonable -- if there is not a reason to s, officers are

not going to test. >> there is a car driving, a minor is in the back seat. the law of lyle is it allows the children to be checked, right? >> -- the law allows children to be checked, right? >> at a certain age. >> there is no age. if all children should be checked, what are the children supposed to show? >> if they do not have identification, did not have to show anything. andre not required to show identification. >> you think under this law children, to prevent themselves from being sent to a detention center or whatever would have to have some type of id. >> mr. chairman, that is not accurate. you're taking the extreme, and i understand tried to make the

point, but it is just not so. >> does the loss they children do not have to be checked? i understand the law says -- does a loss as the -- does block say the children do not have to be checked? >> it is based on circumstances at the time. i think it is demeaning to law- enforcement to assume they do not know how to do their job in a respectful, proper way. >> by want to go to demeaning to law enforcement. i am just going to submit the statute, and it does not list any exceptions. it is not -- >> it is modeled after federal law. >> there are no exceptions here. i did not believe this is consistent with federal law. >> it is consistent with federal law, mr. chairman pierre >> let's go to demeaning police.

-- mr. chairman. >> let's go to demeaning police -- does your log not permit any citizen of arizona to sue error ag any police officer who -- and a police officer who refuses to act for identification? >> it does not allow them to sue any individual law enforcement water -- officer. the discretion has allowed the officer of -- >> there is a right. >> law enforcement has qualified immunity under the bill because we knew they would be sued when they do or they do not. in the founding document, we still believe in we, the people. we gave them the ability sued their agency, if they fail, have a policy that limits, or

restrict the enforcement of the laws. yes, we do give citizens the right. >> here, it says any person that is a legal resident may bring a judicial action in superior court to challenge any official or agency, not just the agency, but any official, of this state, or county, were city, or town, or any other political subdivision that adopts or implements a policy that limits -- limits or restricts the enforcement of federal immigration law. john smith has -- could decide that officer jones has adopted a policy of not stopping the right people, and sue. that would be inequitable case. i just want to guess you this, is there any other statute in arizona that you are aware of

that allows citizens to sue for not enforcing a law? >> i have not come across any. i would state for the record i have not seen any. i will ask you this and then let you respond, why was this law single out to allow the section? is that not demeaning to police officers beck's -- officers? one other question -- will that not push them to do things to protect themselves from losses that they believe they should not do? >> law enforcement set down with me to write that section, mr. chairman. the official was interpreted as a monday meeting in a capacity to set policy. that is why it has qualified immunity.

law enforcement and attorneys said down as we decided and mauled over the language. that was put in by them, but comfortable language they felt gave the officers the protection they need to have discretion, and language that was more compelling to the city. stationary posses are illegal. it is illegal to have a policy that limits or restrictions the enforcement of these laws. not only our states not pre- empted, they are pre-empted from having a policy that pre-empts them under federal law. that is what this is about. making sure they do their jobs. taking the handcuffs off of them. we gave them qualified immunity. it gives the citizens to receive the right to hold -- to hold them accountable. >> the average citizen with no

experience as they are not enforcing the law -- that is a contradiction. i'm curious as to why on this particular law, you wrote in that provision when it does not exist, i do not think, in any other eras of the statutes, certainly not in the vast majority of law enforcement statutes. as someone who has been a pro- police person, the last thing they like is to be sued by citizens supplementing their own government. >> they helped to write it. that was the language they were comfortable with. we sat down with attorneys and associations and wrote language to make them comfortable. mr. chairman, this whole thing, when you talk about no other bill, i do not know of any other arizona state law that

requires me to defend the rule of law. i have not been here to defend tough dui laws or the human smuggling laws. we had to be very careful we knew we would be challenged for simply trying to enforce our laws to protect citizens and jobs for americans. >> thank you. i do not see how would protect police or protect you from being criticized if it allows citizens to sue the police because in their judgment to did not and force it. >> -- enforce it. >> mr. chairman, only four sections have been joined. we have not had -- one lawsuit.

it has not happened carob -- happened. the policies have been eliminated. >> if it goes back into effect, you will see citizens still. >> that is not correct. the first section says he will not have the law the inhibits these laws to the slightest degree. there must be some compliance pierre >> let me go to one final area of questions -- compliance. >> let me go to one final area of questions. there's another chart i want to put up behind me. do you know how many forms of identification exist today that can be shown to crew lawful status in the united states by federal law? >> i do not know the exact number. >> i did not either, so do not feel bad about that, but there are 53. the answer is there are at

least 53 documents that the department of homeland security says will prove lawful status. again, i will show you -- i will not have to be the mall. there is a lot of them. now, i will show you the training manuals. it says the only documents are much more limited. >> so, there are just eight documents. now, according to law, and immigrant shows any of these other 45 other valid documents,

they have to be taken to a ice facility to have their immigration status determined by an official, or wait on the side of the road before they can be released. is that correct? >> it is not quite correct. there is a 24/7, bettis set up. it is usually a five-minute phone call to a ice agent. it is a five-minute conversation usually on the telephone. >> i just want to submit for the record a statute of the police training manual. it reasonable suspicion exists and is practical, call ictv or an officer to determine the immigration status. you rae not -- are not helping

federal law enforcement. if you are doing what you say you are doing, you would say the police officer if they sell any one of these documents should be able to say that is a good idea and go on your way. what arizona does is to restrict the federal law and substitute its own judgment. isn't that correct? >> that is not correct. they have a hot line. these are guidelines. as you notice, this is a 24/7 line. >> why can they have some and not some others? isn't helping the federal government? quite

6 simply gives them guidelines that are acceptable. any other questions you call the officer again. i will repeat myself. it is a five minute conversation. it happens every day of the week. >> they have to be brought to detain its appearance on mss to look at it. >> that is at officer discretion. >> thanks. >> i have a few more questions for the other witnesses. >> let me start if i might.

it is an agency in chicago called los mujere latinos en action. it is established in the hispanic neighborhood of chicago as a domestic violence shelter primarily for new immigrants and for the undocumented. if women and children were the victims of violence, they have a safe place to go. someone who would listen to them, counsel them, and refer them to law enforcement. perhaps a has been has been abusive to the mother. i supported them. i don't think anyone wants to

see that happen. we talk about the impact of this law. it is on people living in arizona. could you tell me your opinion as to whether or not this law makes easier or harder for an undocumented mother to come forward to and to report to law enforcement domestic violence or the abuse of her children? >> yes. the bill has that even been fully enforced. there are still portions that have not been acted on. the portion dealing with local law enforcement forcing them to do immigration law, and a quick comment, first lawsuit filed against the bill was a phoenix

police officer. thee talking an officer on street to came forward to file a lawsuit against the bill. the law that is placed between law enforcement and the latino community is there. it has not even gone into effect. you have a situation who are in the situation who are too fearful to go into law enforcement. we are already feeling the consequences. there are reports after reports of situations who are in a relationship.

they are for the most part held hostage by their own home. there are the seeing this barrier. did you have any law enforcement officer, and they will tell you the number way for them to solve a crime is working work closely with the community. they are reporting these kinds of crimes. they put this between law enforcement and the latino community. they're too fearful to go to police to ask for help because

the fear of one being deported. this is their big concern. >> there is a reasonable suspicion that they are on undocumented status. here is a mother, perhaps with a child as a victim of child abuse or worse, who is fearful to come to the law to protect yourself or her child because of this. >> this is exactly why the governor denied it. they cannot just denied the very bill. this is a very polarizing since. there are victims of crime that

is really hurting these victims. it is unfortunate particularly in the case of domestic violence for you have women who are just held hostage. did they are in terrifying situations. now have a bill that has not been fully enacted. it is already crating this huge thing. >> you publish something in may did they are in terrifying situations. now have a bill that has not been fully enacted. it is already crating this huge thing. >> you publish something in may 24 if. it was entitled warning the nightmarish dream act was backed. it was on the letterhead. it was a link the peace. this was the title of it. you suggest that they talk about those who would be eligible as on shouldn't and so forth. he went on to say they never

showed the tens of thousands of criminal drug dealers and traffickers and gangsters who were caught in some back over the border each year only to return time and time again. help me stop the green act. have you read it? >> which version? >> it has changed. there has been one consistent theme throughout. people with a serious criminal record will never be eligible.

there's never been a version of the bill that would allow anyone guilty of being criminal human trafficker or gangster be allowed into the united states. do you disagree with that? >> i do. >> not all those our convictions. arizona has voted 75% to not allow it. >> i am asking you whether a person who has been convicted of drug dealing is eligible? >> they probably would not be eligible for the dream act. i do oppose the dream act. these are always difficult issues. all of us have a horse and have compassion. >> if you were speeding down the highway and had your infant in a car seat, you were pulled over, should that hit the ticket, it to? analogy't follow that at all. >> it does not happen. >> it happens when an infant is brought to the united states and the parents still filed the

papers. the infant did nothing wrong. and they now want a chance to reach legal status. you're saying because the parents did not file the papers not a child suffers? >> you need to blame those responsible and not us for having to do the laws. i have met with a bunch of them. i do not know how you carve this out. it is a blanket amnesty for those folks. these ought to be carefully executed exceptions. >> the dream act is not a blanket amnesty. you have to earn your way into status. let me introduce you to another

one and your neighbors. a light to get to know him a little bit. his name is oscar vasquez. he grew up in your home state. he spent his high school years in junior rotc. he entered a competition sponsored by nasa and was competing against tenants from mit. 2009, he graduated from arizona state university in engineering. he was one of the top three students in his class. let me tell you what happened after he graduated and realized it could not be licensed as an engineer. he is undocumented. he has no legal status in this country. he went back to mexico. while he was in mexico, at the obama administration granted him to enter the united states.

he could have been pulled over under your lot. -- your law without the waiver, he would have been barred from returning to the united states for 10 years and separated from his wife. the goodness is it provided a waiver. do you know if he did when it came back to the united states? he immediately enlisted in the united states army purity completed basic training and then he was sworn in as an american citizen appeared his serving our country and his country in afghanistan. you have criticized the dream act. do consider him a foreign

soldier? >> oscar is a good story to use. the exception was made. of those exceptions have been carefully thought out and not just a blanket amnesty for support. there is a cost to the american tax payer. i am proud that he would join the military. these are good things. >> i am not in favor of a blanket amnesty approach. across hundreds of millions of dollars. >> the stories about your residence you must know many yourself, families after going

through this, are now reaching a point for the students are stepping out and self i did find some people know who they are, what their dreams are, and what part they can play. can you put their stories in the context of your home state. >> i will make an attempt to do that. i have been here with the support of the dream act here. this is orderly, safe, and they go. it is creating a path away. we govern the three universities. we have constantly have the problem of these people coming to their presidents and positioning of members of the board of regents to give them some kind of exemption.

our legislators said they have to pay out a tuition if they're going to stay here. it has caused immense pain and suffering in the latino community. i know many of them. my distinguished colleague said this is not profiling. it is profiling. police officers tell you that it is profiling. they feel they have to. there to sheriff's -- there are two sheriffs who are opposed. infringes on federal law. they are not trained. they refer people over when there is a violation of the law.

it is absolutely absurd to state here that this is not profile. this has become such a profile issue in arizona that two of our sheriffs, one is under litigation. people are being profiled. you can talk about that was not the intent. that is a fact. imagine two law-enforcement officers are under investigation, one for criminal and civil in the other is a misuse of the office. i can tell you stories that will make your hair stand on end of public officials. he opposes this particular sheriff. the supervisors were indicted.

indited them with the sheriff. the sheriff is under investigation. it has gotten so political if you talk out against some of the law enforcement people the get arrested in arizona. you are a judge any rule against them. he brought us criminal action. they just settled $1 million settlement by one of the supervisors that suit. >> thank you. thank you for the extra time here. i want to echo his words. i have the highest respect for

our law enforcement officials. they get up every morning and risk their lives are me, my family, community, my state, and my country. did they deserve our respect. we do not help them when we create laws and puts them in a position of calling people out because of their status been it is not make their job any easier. >> thank you. i have a few more questions to the other three witnesses. all of you are arizona citizens and residents. can you point out ways that illegal immigrants dress differently than other people? what does this say about the arizona police when they say

that is one of the things to look for? >> if i could comment as a native of arizona and former prosecutor, i am embarrassed for my state. i apologize for arizonas actions toward our latino community, it legal or illegal. this is not a way to treat people. so many of the religions and our state have outreach programs. do not ask immigration. it is a violation of domestic violence for any other kinds of crimes. the federal government has the responsibility. >> thank you. >> thank you. the bill has been the worst piece of legislation ever

passed in the state of arizona. if you look at sections 3b where reasonable suspicions exist for they are unlawfully present in the united states, the only way to determine is not buy clothing or the color of their skin. there is no way to enforce the senate a bill whip out using race as the determining factor if someone is here illegally. i would propose that if we were walking down the street in new as law enforcement to pick of the person who they suspect would be here undocumented, they're not going to be pointing at mr. perce, they will be pointing at me why did the sponsor get recalled of the own legislative district tax this bill is that of the policy of the state of arizona. it it has given us a negative image.

it will give us years to get out from underneath. >> legislation is before the supreme court tomorrow. we reach out to many officials. who's the only one that would come. if you believe and voted for the lot and are enforcing the law, why can you come and defend it? he was the only one he would come he had his opportunity to make his case. we've reached out far and wide with the official supported the law. the clip you showed which is powerful and moving, i take it

that happens frequently. >> i do not have axel information to give you a number. -- actual information to give you a number. >> who is making it seem like it was an exception. >> i am told the sheriff has conveyed that it happens. he feels his deputy should not have to be put in a position of being liable if they should not ask somebody. >> are you familiar with the law? i think the clip was before the law was passed. >> that have passed both houses.

>> thank you. this is the critical part. it has not even been fully enacted. consequencesthe over the last two years. we had one who was arrested and detained. he was brought in. he is a u.s. this is a. these are situations after situations. once this and you get an argument and violence occurs. these are the unintended consequences that comes from legislation when the state tries to fix what is a federal problem. it forces law enforcement to enforce it.

>> are you familiar with any other statute? where a private system can sue because the individual officer was the enforcing the law? >> not one. >> i'm not done the research. i served as a county attorney. i knew no law at the time. i talked to police officers all the time. perhaps there are some there may be one are. >> first of all, proposition 200 passed in 2004. >> what is that one?

>> 200. it deals with a photo fraud and proof of citizenship, i be at the polls and no benefits for those in the country illegally. >> does that allow law- enforcement expressly to be sued? >> it is just the benefits. they got qualified immunity. there are bears to the state of arizona. we have a national crisis. we can go through this. they said these little anecdotal things. all this are disappointed.

illegal is a crime, not a race. it does not pick up any nationality. 90% of those who violate our immigration laws are hispanic. common sense. if i at 3:00 p.m. people, i do not know what color they are, and they're going to get stopped in question. -- and questioned. we have a national crisis and we ignore it. i think americans are tired of the statements by politicians insisted dealing with the issue at hand.

>> we made big progress. none of my colleagues on the other side of the aisle came here. weeny people to sit down. we have been on able to find negotiating partners. -- unable to find negotiating partners. the absence of people today not only shows an unwillingness in washington and arizona to defend this laws or be associated with this law, but it shows absence of an ability that

is broader. we get a letter rhetoric out there. there is a debate in terms of rhetoric sometimes very inflammatory. >> with that, i'm going to close this hearing and thank our witnesses. i just have to do a little housekeeping year. the record will remain open until tuesday may 1, 2012 for further testimony. i would like to think individuals and groups for submitting testimony for the record.

it will be added. that includes the conference of catholic bishops, american immigration council, and the american civil liberties union. i am asking unanimous consent that they be inserted to the record. i think the witnesses again. the hearing is adjourned. >> thank you, mr. chairman. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012]

>> i delayed in the law. i am going to defend the law. this is model legislation. to run a thousand left the state of arizona. >> 200,000 left it. we know it works. i am disappointed. we lead the nation. hang on. the governor has stepped up to support this exercise. i'm disappointed that others were not here. >> do think the politicians take a drive-by approach, and you felt confident romney will?

>> i think he is honest. it is a good thing we disagree. he is looking like an evangelical preacher down there. then he backed down. that is the difference. latinas that are americans support this overwhelmingly. in 2006, we have for ballot initiatives. they voted 60% on all four of those. hang on. hang on. why do demean the hispanic community? why would you demean them? hang on.

one question at a time. why would we think they're less of an american? folks who have fought for this country and others, they love this country as much as you are i appeared i find it demeaning that you think they're the good is because they are hispanic. that is not true. >> is it true that you are linked to people that are investing more prisons? >> that is not true. npr invented the story. i find it amazing -- i think they will come from a dream. there is no truth for that. zero. she has already read the solicitor general. my guess she will refuse yourself. if not it will be applied for.

>> i'm getting that far. i knew i would have the odds. and everyone would probably be against me, the democrats especially. they're pro-amnesty but call it reform. it covers the real intent. i'm willing to defend arizona whether i am one guy in the crowd or not. the majority of americans stand for the citizens. >> the fact is if you were set up, if some of the colleagues set up, maybe we would have a balance hearing? >> i do not know the reasoning.

if they thought it was going to be unfair, i would have appreciated a phone call. i am not one to run from what i believe is the right thing to do. i have a moral compass. >> the romney campaign is insisting that there were not saying that it was the model. had the feel about that? >> i'm not going to comment on something i have not read. >> they said he is not referring to it. have you feel about that? intom not going to get specifics. i have for these advisers. i know romney is a compassionate man.

i also think he understands the crisis in damage. for i admire that about him. >> where was that? >> it is at the convention in 2010. we went up in the corner. there are exceptions. i think it can be carved out. you cannot do these blanking policies or use taxpayer dollars to subsidize its. >> do you support the dream at targeted? -- dream act that is targeted? >> anytime they want to do something, we think it is ok to import illegal foreign labor. it is not a path to citizenship.

there are two pep boys. some people will never get it right. >> would you support a vote for dream act students? >> i will not support any de -- blanket policy. >> do you think sb-1070 will prevail in court? >> i am confident. >> what any part render the bill obsolete? >> it has been approved constitutional. their on the four sections in question. again, read the bill.

i read it carefully. we sat down, and we went through every line. the number one attorney on pre- emption issue is -- we knew we would go to court. we voted to go to the supreme court. >> talk about one of the specific sections. under federal law, it is a criminal offense under arizona law. tell me how we mirror federal laws? >> sybil, under federal law is a criminal law. you can get fined or go to jail for it. we need to make sure that is clear. entry and remaining here is a crime. >> wanted the supreme court decides -- what if the supreme court decides --

>> august bid was put into state law. it does not change much of anything else. it should not have been necessary. that is why it is in place, to remove illegal policies and we have done that. so, the major part is in full force. the other is an important section. i would not have written them in their if they were not important. >> do you fill out -- you were the only one? >> it will be a chilling effect on other states wanting to model us, but it does not change the constitution. i've been enforcing immigration laws since march, 1970. it was never an issue. it has never been pre-empted. they have never been pre-empted.

>> the taste it -- the fact is, if the supreme court concludes they did not have these authorities -- >> that will not be the decision. state statute against federal statute -- that is the issue. it will not remove one piece of the state compel police power. is it important? >> if they deny it is the police power to get involved. you are making a prediction. i realize you are brilliant, walk on water, but if the supreme court does not see it your way, and even votes for-4, it seems to me the justices would say they do not have that authority. >> it would just be saying he did not pass because you did not have the majority vote. the point is, it will pass. it is the same issue with employer sanctions.

the pre-emption issue is the same argument. the misinformation. tourism is up in arizona. i am tired of the misinformation as we try to demagogue a good bill. we cannot retreat from that. i do not intend to apologize for anything. i love and respect those that come here legally, and many that do not come here legally i know are not bad people, and i understand that, though we have a method of coming here. >> senator john kyl released a statement saying this was more of a political theater. >> i did not entirely disagree with that they do not have a vote, the supreme court does. chuck schumer can run the bill, he might get out of his committee, but that is where it will die.

it is supported across america. i guarantee it will not be heard in the house. >> was it worth your while to come here today? >> absolutely. i wrote the bill. i feel obligated to defend it. even though you worry about decorum and what needs to be said, i think it is important that i come out here and represent the state of sara -- arizona. >> even though there were two senators, you think it was productive? >> the story will be told in the media. i hope they cover it well. >> what is your message to specific cases? will you want to see them leave the country? >> my heart goes out to them. those exemptions have to carve out policy. i know some of them are good kids. my heart goes out to some of

them. i'm not apologizing for having sat down with them. it was very careful. -- careful. my heart was touched. kids who go to jail every day, it touches my heart. i cannot touch that. the laws must be enforced. >> are you concerned about kids like this? >> the laws must be enforced. only federal government can fix this. states have no ability to set the conditions of coming here, or remaining here. his federal purview. >> a senator said he was in. on behalf of the state. >> he is a friend, but i will be candid, maybe he shares the

same feeling that michele obama feels when she was only proud of america when they elected her husband off to 9000 americans are killed at the hands -- husband. if up to 9000 americans are killed that the hands of illegal immigrants, the jobs taken from americans, the wages suppressed, the cost is not measurable. that is what i'm embarrassed about. those that refuse to do something about the damage to americans. >> how do you you respond to the commission that came out yesterday that showed him immigration from mexico is said net zero. it seems to be going the opposite way. >> partly because of the recession. what is happening in arizona is not helping to states around us. it is unique.

no other states have experienced a reduction that we have. we've gone from 49th during the recession, to number six in job growth arizona has done some things right. >> did the senators tell you they were not going to come? were you expecting to be here to support you? >> support arizona. not just me. this is arizonas right to protect jobs for americans. let's take a step further. it is arizonas obligations to do that. >> mr. pearce -- are you disappointed you did not have senator john kyl here or any other republican? >> they probably had good

reasons. i would have appreciated a call. this is about states' rights. arizona has certain rights. this is about defending arizona's right. it is overwhelmingly supported by arizona and across the nation. it is passed. it is signed into law. it is also a federal law. arizona took a lead in the nation to solve this national crisis. again, over 50% of the entries go on through arizona. >> i understand what you are saying, but are you disappointed that no other republican senator showed up? >> of course i am. >> why do you think they did not show up? >> i have no idea. it would be unfair of me.

>> are you aware of the arguments of the unwanted effect of causing problems because the lack of labor? >> absolutely not true. illegals use social services 3- to-four times that of any other demographic. we did the study. be demographic and its violent crime in three times as likely as any other demographic. the myths have to be set aside. >> would you say more than 7% are undocumented? >> this is on both sides of the statistics. again, you have the 26-year high in unemployment. one of the problems we have is that we are raising kids today that do not know how to pull the rope on an engine.

they do not want to working-day sweat environment. they want air-conditioning. that is part of our problem today. ex what are you hoping the supreme court will take under consideration tax a lot of people are saying they will -- people are saying [unintelligible] >> that prohibits. they say they can do with no restrictions. they said it was fourth. it is unrestricted. in arizona, i took that into consideration. i made it clear in the bill that you cannot use ratio produce a filing -- you can not use racial profiling.

the federal government does not put it in their. >> are you confident that officers across the stage are following that direction? >> i am i know the good parts of these folks. when you make thousands you will find some that do not agree. these are good men and women trying to do their job. >> thank you so much. >> thank you. [captions copyright national cable satellite corp. 2012] [captioning performed by national captioning institute]

>> this week on "the communicator's" a look at law- enforcement use of cell phone and other technology for the use of surveillance. our guest is a staff attorney with the american civil liberties union.

"the communicator's" airs this afternoon and 6:00 p.m. on c- span. tonight, beginning at 6:30 p.m. eastern, the 98th annual white house correspondents' dinner. along with president obama, late night talk-show host jimmy kimmel is headlining the event. we spoke with jimmy kimmel to get his thoughts on being chosen, and how we is preparing for this evening. >> jimmy kimmel. tough crowd. how do you prepare? >> that is what everyone says. it makes me nervous. i guess if the room is tough, you have to fight your way out of it. maybe i will not show up. maebelle i will have a moment of silence -- maybe i will have a moment of silence for 40 minutes. >> that would be an exciting moment on c-span. how do you prepare?

>> we write a lot of jokes. we go through the jokes and determine if they are to offensive for the room. then, we debate that sort of thing a lot and ultimately, we come up with a bunch of jokes in a certain order that we feel will work. when i say we, niemi and the writers of my show. -- i mean me and the writers of my show. we see how it goes. >> where do you draw the line when it comes to singe, not to burn? >> dareen lot of lines -- there are a lot of lines. part of it is, you know, you do not want to harp on one topic. obviously, the secret service being is something i will talk about, but not necessarily 30 jokes about it. i will stop at 20. >> have you had an experience where you had the president of the united states listening to your jokes and -- how good is he for this? >> he is not great for

comedians because he can probably be a comedian himself if he wanted to. it is more fun when you have a bill clinton or george bush. people who are more courtney -- cartooney. the president keeps to himself. if somebody throws and a basketball, he makes the shot. he ruins everything. i have never been in a situation where i have done comedy in front of the president. >> are you a political comedian? >> i do not think so. i probably talk a bar at the kardashians more about politics. >> how long have you been on this trip and in the blast, have you booked in the interactive? >> i have been here a few times. i love washington, d.c.. the fact they you can go to these monuments and sit under

the lincoln memorial in the middle of a the night, it is fantastic. when i came here, i thought i would be looking at a statue but to see some of these memorials in the white house -- i have never been in the white house before. i probably will never be asked back, either. it is very cool. >> what do you think about all the attention that the washington press course gives? chrissy it makes sense it would give a lot of attention to a dinner with a big host. there is a lot of attention. it is an unusual thing. you have an unusual mix of people sitting in a room with the president and with all of the top people in media and then you hire some buffoon to come in and entertain and you feel like you have been commanded by the king to be the court jester or

something. >> seth miers has done this. have you consulted with him or at least watched performances? >> i spoke with said miers. i did not speak to rich or don. i spoke to stephen colbert. frank sinatra hosted this thing. there is so much history here. it really is an honor. i know it is cliche, but it is an honor to be asked to do this. >> when were you asked and what was your reaction? >> some secret service agents burst into my bedroom in the middle of the night and they said, you are doing this. i said, can we relax and have a few drinks? they called my agent and my publicist and they called me and i said it was great and then i realized i had to actually do it. >> where you from?

>> i am from brooklyn. i grew up in vegas. i did not graduate college. we are off to a dead star right there. i was in radio for a long time before i want up on television. now, somehow, i wound up here. >> jimmy kimmel tonight. >> average of the correspondents' dinner kicks off this evening with red carpet arrivals beginning at 6:30 p.m. eastern. >> lee fights and masterful delaying action, but what happens at the end? you still lose. why? you are pushed back, and what happens? what kind of operation happens that place in federal advantages? a siege. >> this weekend, lectures in

history. lee and grant, and their american way of war. tonight, part of american history tv this weekend on c- span 3. >> the social security trust fund will not be able to pay of full benefits beginning in 2033, three years earlier than projected last year according to an annual report. the declare depletion date remains 2024, though kathleen sebelius credited the 2010 health care law with setting the medicare program on path to save $20 billion by 2016. she was joined by several cabinet members. >> i want to take this opportunity to thank the chief actuaries, for their hard work on their reports.

>> every year, reports are issued on the strength of these programs, and we just met. millions of americans rely on social security and medicare for income and health care, and many will in the future. these programs have the resources they need to fill agreements with the american people for years to come, but we must take steps to keep these programs whole for the future. pressures on the programs are mounting. americans are living longer, and the number of retirees is growing. the reports project that when considered on a combined basis,

social surity and disability have dedicated funds to cover benefits for the next 20 years. in 2033, and incoming revenue and trust fund resources will be insufficient to maintain the payment of full benefits. after that time, dedicated funds will cover three-quarters of full benefits. the trust fund will cover benefits until 20/204. the same year as was projected last year. the projections in this year's report are somewhat more pessimistic than last year's projections. for the combined social security and disability trust funds, the 75-year and -- actual stocks actuary is off. with regard to medicare, the projected actuarial imbalance of the trust fund has increased 5.6 of 1% due to changes in cost

projection methods recommended by that 2010-2011 medicare technical review panel. while uncertainty surrounding the 75-year projections is substantial, these reports emphasize the importance of building consensus of reforms that will put these programs on a sound financial footing for the future. the affordable care act began this process with the most significant entitlement reform in the kids. that lot includes measures to strengthen medicare by reining in health-care cost growth. one of the most important things we can do is to preserve medicare is to implement the affordable care act fully and ornate st. tantric that is why the president has put forth a plan to strengthen medicare. by the beginning of the next

decade, his plan achieves the same amount of health care savings as a bipartisan plan proposed by some symbols -- some sen -- simpson bowles. and asking the very wealthy of seniors to pay more. the president is committed to keeping social security strong for future generations, particularly as more private employers move away from bev -- defined benefit plans. last year, the president outlawed -- outlined a set of principles for reform. emphasizing the importance of finding a bipartisan solution that strengthen social security and does not hurt current recipients, does not cut benefits for future retirees, or tie the program to the stock market. as we work to strengthen social security medicare, it is

critical reforms are phased in over time so that current beneficiaries are not affected and so the future beneficiaries do not experience precipitous changes. at the same time, adjustments to social security and medicare must be balanced and evenhanded. we will not support proposals that so the seeds of their destruction in the name of reform or shift the cost of health care to seniors in order to sustain tax cuts for the morse -- most fortunate americans. social security and medicare are the twin pillars of retirement security. they are as president obama has said in expressions of the fact we are one nation. these programs which are rooted in a basic american sense of fairness and responsibility have been supported by both political parties in democratic and republican administrations. i will turn the floor over to my colleague and fellow trustee kathleen sebelius.

>> thank you, secretary geithner. today's trustee report confirms medicare is in a stronger position than it was a few years ago thanks to the affordable care act. without the health care law, hospital insurance trust fund would be exhausted in 2016 for years from now. as a result of a lot we have added another eight years to its life, putting medicare on much more solid ground. the law does this through a range of reforms from cracking down on fraud to helping providers prevent costly medical errors, reducing excess payments to medicare advantage plans. as a report our department released today shows, the first wave our reforms will save more than $200 billion by 2016 while lowering costs for americans with traditional medicare by nearly $60 billion. that is real money in people's pockets.

in addition, the report describes reforms in the law that can lead to even bigger savings down the road. by addressing the misaligned incentives that are major driver of rising medicare costs. we know that many leading health systems have reduced costs by improving care. for example, by managing care more effectively for patients with chronic conditions to keep them healthier and out of the hospital. in the past, the medicare payment structure has made it difficult for providers to provide that kind of care. the health care law begins to break down those barriers with your reforms that free doctors and nurses to deliver higher quality, more efficient care. these incentives are just in the beginning phases. we are confident they will improve care and save money. that means it is possible that

in the long run, the health care law will do even more to stabilize medicare's finances and the report today indicates. still, as secretary geithner said, more remains to be done. today's report shows that medicare per enrollee spending will continue to grow at a slower pace than the private insurance industry. again, thanks in part to the health care law. it also shows overall medicare costs will continue to grow because of our aging population. that is why secretary entered notice, the president has put forward a budget that builds on and expands their forms in the affordable ^ to do more to cut waste and fraud, reduce unnecessary payments, and health providers deliver more efficient care. unlike some of the other plans that have been put forward, this is an approach that will put medicare on a stable

trajectory without eliminating the guaranteed benefits that beneficiaries have counted on for decades or shifting a tremendous new costs on to seniors. it is an approach that makes sure the strong medicare is there for our children and our grandchildren. today's report shows that this approach can work. it also makes clear how important it is to implement the reforms in health care law and the president's budget to secure the promise of medicare for generations to come. quex good afternoon, everyone and thanks for joining us today. we have occurred about the long term future of social security and medicare. they serve as a critical lifeline for millions of americans, especially for those experiencing these tough economic times. today closed a $54 million, 38 million retirees, 10 million americans with disabilities, and 6 million survivors of deceased workers. social security also served as a critical role in combating poverty in this country.

it is estimated that of social security payments were excluded from income, the number of older people in poverty would increase by 14 million individuals. challenges remain for social security and medicare and vester retirement security of many americans who depend on the benefits they provide. secretary geithner and secretary sebelius stressed the importance of the actions to address these challenges. costs are continuing to increase due to the end -- continue retirement of the baby boom generation and lower birth rates for younger generations. people are living longer and the cost of health care has continued to rise especially in private health insurance but also for public programs. reducing the long-term costs of medicare will depend largely on provisions of the affordable care act which will take effect in the coming years. that is one big reason why ensuring the successful implementation of this historic health care law is so important. but there are other important

steps that strengthens the solvency of the social security and medicare trust fund. critical to this effort is a continued and sustained economic recovery. in the past 25 months, the economy has generated $4 million -- 4 million jobs. layoffs have decreased to 2006 levels and the on implement rate has decreased from 10% at the height of their recession to 8.2% today. we have made steady progress, but we're not out of the woods. we have more work to do to make every person in every community drive against. putting more people back to work is crucial to the health of the social security and medicare trust funds. when more people are working, our payroll tax base grows answer to the trust funds as people are able to contribute to them. we're taking concrete steps to put people back on the job in a quicker, more effective way. the recent extension of the unemployment insurance an important reforms that come along with that are critical to this effort in providing better

services and more flexibility, returning the unemployment system into a re-employment system, making it easier and quicker for people to get back to work. we're finding job-training initiatives that are focused on making sure the skills workers gain in the classroom matches what employers are looking for in the office or factory floor. over the past two years, we have work to incentivize businesses to put more people back to work. we also continue to support policies and encourage disabled and older workers to stay on the job. this effort also helped to address the solvency of the trust fund. many disabled workers can and do want to work. we have got to help them do just that as quick as we can. we put forth a number of initiatives to speed up medical recovery to get folks off disability insurance, and back on the job. currently, we're collaborating with the social security administration to build on this important work. over the last three years, the department of labor has helped

16 states provide disability insurance claimants with targeted job coaching and training to help them get back to work. last year alone, the number of one-stop career centers engaging with participants of the ssa's to get to work program increased by 34%. we're hoping that those who can get back to work do so and we're making sure they keep part of their benefits in the can get the need they possibly can get the need the help in transition back to work. it is providing millions in savings, many of whom are low- income and thus depend on these programs for their survival. we must act soon to address the immediate and long-term imbalances between incoming cost to the program. the earlier these reforms can be made, the more options and more time we have to better prepare for those affected and to ease the burden on our most believable communities. thank you. >> i would like to begin by commending the public trustees

for their important contributions to this year's report. this report is the first one since 2007 where we have had the benefit of two confirmed public trustees for the full european -- for the work. we are working in a bipartisan fashion that should be a model for all this in washington. having them on board has made an enormous difference on areas ranging from techniques of economic analysis to plan language. speaking of bipartisan congeniality, it is time for congress to take on the cut -- the task of retooling social security for the long haul. this year's three year movement on the exhaustion died -- a day makes legislation more critical than ever. congress must begin the process of deciding what levels of benefits and taxation best serve the interests of younger americans who are increasingly uncertain as to whether they can count on social security.

it is also vital for congress to consider reallocating assets between the trust funds so the disabled americans do not have to fear reductions of benefits in 2016. finally, as in the past, i want to urge you and the media not to complicate congress's responsibility. please remember that exhaustion is an actuarial term of art and it does not mean that there will be no money left to pay any benefits. after 2033, even if congress does nothing, there will still be sufficient assets to pay about 75% of the current level benefits. it is not acceptable, but still fact that there will be substantial assets there. i want you to know this year's change in the disability trust fund as with last year's is due almost entirely to demographics

and the recession. in the past year, there have been reports to the contrary and i urge you not to repeat the reporting period we need the debate to begin and we need it to be civil and fact base. clear and accurate reporting on the complexities of the system is essential to that debate. and to read about, this is the six trustees report i have signed. more than any other commissioner for -- or robert ball or [unintelligible] it has been a tremendous privilege to serve as a trustee. thank you. >> the social security and medicare programs remain among the more remarkable legislative achievements in american history. these programs have provided critical insurance protections for hundreds of millions of americans. they have done it at low administrative costs and they

have done it with financing methods that while they have their critics, they have been generally accepted by most of the american public as equitable, historically. it is important to remember these achievements as we review this year's financing projections. both so security and medicare finances did take a further turn for the worst this year. as with every year -- bringing these programs to long-term solvency. as we review our options, the continued strength of these programs depends not only upon their finances been restored to balance, but this is done in such a way the public continues to believe is reasonably fair and if time -- as time continues to pass and finances become more strained, this becomes more difficult to achieve. before getting to the specific numbers around social security, i would like to note some general differences between social security projections and medicare projections.

social security does not tend to have large swings in its outlook from year to year. this is because the demographics that guide its finances have been relatively well known for some time. medicare faces greater projection uncertainty because factors like health care, cost inflation are more difficult to predict. my colleague will talk about the medicare cyber we have had some offsetting projection changes in the short term. some positive, some negative. by contrast on the social security side, most of the variables line on the negative side. on the social security side, the short-term and long-term outlook this -- worsened somewhat. that is a term of art but basically that is the program's tax base in worker wages. that is 04.44. this is the largest deficit we

have seen since the 1980 reforms and this is the single year duration -- the largest single year deterioration we've seen. the projected date of combine tests -- trust funds is to be 2033, moved up from 2036. we have lost some ground because of passage of time and legislative inaction but also because program finances are somewhat weaker than we have previously projected. the 2033 date is the earliest projected by the trustees in more than a decade of reports and there were few reports in the mid-1990's that saw trust fund depletion happening earlier but we have to revert it is later in the game.

as a result, never since the 1983 reforms have we come close to the point of depletion as we are now. 21 years off my son like a long way but given the magnitude of the financings shortfall, it is not. our window of dealing with it without disruptive consequences is closing rapidly. in 2033, it has been said we would have enough revenue coming in to pay 75% of scheduled benefits or the payroll tax would have to be raised from 12.4% to 16.7%. one must bear in mind assumes we would willing -- be willing to cut benefits for people on the rolls. people receiving benefits in 2012. if you factor in the desire on the part of many policy makers to shield people receiving benefits from changes to shield low-income recipients from benefit reductions, it is clear we do not have a great deal of time left to resolve them

balance in a way that people on both sides of the aisle will find acceptable. our immediate concern, we have the fact that the disability insurance trust fund is projected to be exhausted in 2016. the earliest of the different trust funds will report on. one option is to reallocate the tax rates between the disability and retirement side of social security. we have to remember that would shore of disability only at the expense of the other social security trust funds. you want to avoid weakening the other side of social security, we will have to make some tough for traces. we would have to decrease disability benefits or increased disability taxes considerably and fairly soon. we would have to find $30 billion of savings annually with and that disability programs in five years to prevent insolvency. why does this year's report show a decline of social security finances? this is because of act -- updated economic data. we had larger than expected c.o.l.a. this year. this affects our projections

for 2012, 2013 and beyond. we modified our expectations for long-term changes to worker hours to better fit historical data and the aging of the population. we have the usual grab bag of changes on the -- side. we have passage of time and we have incorporated some updated birthday data. this year, all the smaller factors lined up on the negative side of the line and that is unusual for social security reports but it is an unfortunate reality this year. by any objective measure, the problems in social security are growing so much more serious. the insolvency date has drawn closer. actuarial and balances larger and accounting for all the sources of trust and income including interest and other enacted transfer revenue from the general fund, it -- the ratio is lower than the peak level in 2008 and projected to further decline. the shortfalls have are much larger than can be corrected at

the last minute as was done in 1983. bipartisan action needs to be responsible, decisive, and from to. thank you. >> that afternoon. being the last of the six trustees to speak, i will be very brief. the prairie responsibility of the public trustees is to assure the american public the financial and actuarial analyses contained in the reports are as objective as possible. they used the best available data, and information, and they employ the most appropriate methodologies. i can speak for others as well as myself. we can provide that assurance with confidence to the american public. once again, we have participated in an open, robust, and vibrant discussion of the numerous issues that must be resolved when these reports are

put together. once again, we have been impressed by the expertise and commitment to objectively of the actuaries and their staff. the department of staff, the support of the ex officio trustees, and the staff of the social security administration. we benefited from the deliberations and recommendations of two technical panels. the medical -- medicare from hhs and the social security technical panel convened by the social security board. we have incorporated some but not all their recommendations in these reports. we intend to continue to draw on these panels' insights as we develop future reports. let me make a few observations now that relate to the content of these reports. i want to add my voice to the chorus that has emphasized that under current law, both these programs are on unsustainable patterns.

the senate policy makers to address these, the less destructive the adjustments will be for individuals and the economy and the greater the likelihood that the solutions we adopt will be balanced and equitable. while the bottom-line message of the 2012 reports are -- differ little than those of previous reports, it is important to realize that the projections contained in these reports, as others have emphasized, include a lot of uncertainty. this is true with respect to the medicare report in which the current law projections that are the basis of this report assume that payments under the physician fee schedule will be cut by 3.9% at the start of 2013 to comply with the sustainable growth rate mechanism. it is almost certain that over -- lawmakers will override this reduction and expenditures will

be higher. conceivably as much as 12% higher than is reported in these reports for 2013. the challenge facing medicare will depend critically on our ability to it here to the discipline contained in the affordable care act, which in turn will require significant transformations of the existing payment and delivery systems, the ability of providers to improve their productivity, and the willingness of employers, unions, and other payers of private policies to join forces with medicare to demand change. even with the unified and concerted effort, for their major legislative changes above and beyond the affordable care act will be required to put medicare on a sustainable path. let me close by saying that as someone who spent an hour yesterday applying for medicare because i have stepped down after 12 years as president of the urban institute, i have not

-- i haven't even greater interest in ensuring the sustainability of medicare and social security, both for current and future generations of beneficiaries. thank you. >> thank you. we would be happy to take a few questions. >> the disability trust fund, what is the plan to deal with that in the near term? to combine the fund or direct money away from the oasi fund? >> congress face this problem in 1994 and they acted with a temporary solution. the best thing to do is to do a long-term solution and we will work toward that with congress. >> a question for secretary sebelius. >> i am curious that there is a

question raised by the trustees and rec foster about whether or not the projections will come to pass. did you have any thoughts because you spent so much time defending the law and the significance of these projections? what does it mean if there is a shadow hanging over as in that report? >> there has been traditionally reluctance among congress to adopt payment reforms and medicare advantage is a great example of that. it was begun with a floor intentionally above medicare fee-for-service. as a way to encourage competition in the marketplace. but 15 years later, we were still paying at the passage of the affordable care act 114% of fee-for-service in spite the fact -- of the fact that people said it needs to be lower. in the last two years, medicare advantage plans are being paid at a rate, 107% higher, not 114%

higher. we're on track to get parity with fee-for-service. we're assuming that the payment reductions included in the affordable care act will be carried out if congress chooses to interrupt those, if congress chooses to add additional funding, then we have to make different assumptions. the skepticism is because often congress has intervened at times where there have been challenges about lowering costs, and kept costs at a higher rate than medpac or others would have seen as advisable. >> [unintelligible] wasting over a billion dollars in taxpayer money. is there any question that hhs has the authority to establish a program? how would you respond?

>> the good news is that medicare advantage, in spite of all the allegations that the affordable care act would destroy the program, is stronger than ever before. we have more companies participating in the plan. consumers are getting information about quality ratings and we have more beneficiaries migrating to four-star programs than ever before. even with the demonstration which is due to expire in 2014, we are on track to reduce the overpayment of medicare advantage. with the demonstration money included, we have dropped from 114% of fee-for-service to now 107% of fee-for-service. the cut in half the overpayment to advantage. it is a basic win-win-win situation. beneficiaries are paying lower rates. you have more plants and

consumer information for the first time -- plans and consumer information for the first time. we're reducing payments which will save money in the long haul. >> i am happy to have secretary gunnar answer that. >> do you plan to let that demo run out and not read to a -- three do it? >> that is our plan. it was designed as a demonstration project. our goal is not only to give consumers information but to put medicare advantage plans on notice we're measuring quality for the first time as opposed to having a proliferation of plans available, often very confusing to beneficiaries about what the benefits are. this is an important staff and we are pleased to see that more beneficiaries are migrating to the higher rated plans and we think at the end of 2014, it will accomplish what the goal was, which is to give financial

incentives to those plans for improving quality results. one of the most discouraging factors around medicare advantage, not only were those plans being paid 14% more than fee-for-service, and 75% of the beneficiaries were picking up that additional cost because the cost was spread. there was no increased health of -- outcome. as a result of that overpayment. we think this demonstration was important to inform consumers. we intend to keep that quality system in place, and not the additional incentives but again, medicare advantage rates are down substantially over where they were when the president, two years ago, the affordable care act. >> thank you for coming.

>> this week on a cold the communicate -- "the communicator's cocotte all look at whether current law covers cell phone tracking. our guest is a staff attorney with the american civil liberties union. this afternoon, 6:00 p.m. eastern, here on c-span. >> where is the national public radio table? [applause] >> you guys are still here. [laughter] >> that is good. [laughter] [applause] >> i could not remember where we landed on that. >> later today on c-span, the 98 annual white house correspondents' dinner, with

president obama and comedian jimmy kimmel headlining the event. coverage starts with red carpet arrivals, and watched the entire event at 6:30 p.m.. it can also watch guest lists, highlights of past dinners and social media posts had c- span.org/whcd. >> lee fight him master holding action, what happens at the end? you still lose. what happens? you're pushed back and what happens? what kind of operation happens that plays to the federal and advantage ? >> this weekend, a professor examines both lee and grant, and their american way of war tonight, part of "american

history tv." this weekend. with an increasing number of people accessing video online and through mobile devices, a hearing was held to explore with the increase means for consumers, technology, and the price of access. witnesses included the former ceo of paramount and fox, and executives from microsoft, amazon.com, in the nielsen company. this hearing runs two hours. >> good morning, everyone. we have a distinguished panel. this is particularly so. there will be thousands that will be asking the most penetrating questions. anyway, this hearing is about

the emergence of online video and the power of broadband, and who knows what that is going to be five or 10 years from now. this is the start of an exciting and time the conversation. it is the first hearing that has been held on this subject. it is not attacking each other, but looking out into the future, trying to figure out what is coming at us, can we handle it? why are we doing this? television is an overpowering force -- television meaning what a lot of people still watch. at its best, it can do more than entertain, it can educate, but not all programming is in 19 -- and lightning, or all fit for children's viewing. it is a global age, and i am concerned it does not always

represent the best face of america has to the nation. my first question is how will this disruptive technology, and that is not a negative connotation, it is just effected things are changing so fast in such important ways that it is disruptive, hopefully in a positive sense, but definitely disruptive -- how will the disruptive technology and online viewing will provide lead to better content into more consumer choice? more than content is at issue here. here in, and year out, increases for pay television are rising faster than the rate of inflation. we paid for so many challenge -- channels, but we only watch a few. i have 500. if i watch in a month more than 10, i would be amazed.

why am i paying for 490? i have no idea. does it give me a warm feeling? not particularly. on the other hand, it is all there if i want to go get it, so who is to know about human nature? so, i want to know if the emergence of online video will do more than improve content and extend viewers. i have said that too much television program is crude and a poor reflection of our society. although this hearing does not focus on that topic, i also want to make it clear this is something that i care about deeply as all of my suffering colleagues on this committee now, and i will keep at it until it gets better, or until i get to be my great-grandfather's age, whichever comes first.

my question is how do we harness this change for power for consumers, so we can get higher quality programs that have lower rates? more importantly, what is going to happen to the status of people that are cutting off a land lines for telephones? i think i read in the last month that neilson said that all broadcast news was down in the last month. if it is down over the course of a year, it would be down over the course of the month, but it grant me -- putting it that succinctly. i look forward to your thoughts, and thank you for joining us today. i want this to be a lively and 4-looking series. senator jim demint is the ranking member of the

subcommittee on this subject. senator kerryforward to your co. >> thank you, mr. chairman. i think the witnesses for being here. thanks for holding the hearing. the communications sector continues to be one of the most dynamic and innovative. i hope this is one of the first of many hearings that allow an opportunity to learn and discuss the marketplace and update the khomeni's record. the obstacles between consumers and the video content they seek continues to disappear. the video market was a tremendous advancements in technology and massive capital investment and networks in power the worst to craft their own viewing experience. at the root of this is a complex and overlapping mix of content creators, distributors, and

electronic manufacturers, racing to serve the marketplace better. a few such companies from the sonics are with us today. with innovation and howard -- empowered to innovation comes a need to establish a incumbent powers. and number of our laws were achieved decades ago by interests seeking government granted protection from market forces. they were written for a time and a market that no longer exists. they need to be repealed. our video laws do not reflect the current realities of the marketplace. i'm afraid they've foreclose innovative service offerings and consumer benefits. our laws should not promote or protect one technology over another, or one competitor over another. last year, i introduced the next-generation television marketplace act to comprehensively withdraw government meddling from the

video industry. there are two primary interventions the government has made in the video market which my bill repeals. the compulsory copyright license and re-transmission consent. these laws impose mandates on consumers and businesses, they violate the property rights of content creators, and they treat similar services differently. while i know these legacy issues are not the focus of today's hearing, i look forward to discussing them at a future hearing in this committee. in his prepared remarks, consumer demand is a powerful force and those who give consumers what they want will be rewarded in the marketplace. i could not agree more. i believe we should be creating a deregulatory parity so investment and innovation, not

lawyers and lobbyists, is rewarded in a free economy to the ultimate benefit of all consumers. finally, i want to express my sincere interest in working together with you to seek ways to improve our laws and regulations to better -- better serve competition, innovation, the national economy, and the american consumer. thank you. >> thank you and thank you for those comments which obviously i share about working together. we have not sat together before but we will sit together in the future. our witnesses are sublime. barry diller, who i have known for many years, my wife says hi. president of paramount late york knowledgeable about the history of video and you have spoken about how the destructive

to change -- disruptive change may change the nature of pay television. we welcome your testimony. >> i am glad to appear today. some -- for a long career in media, some say too long. i have been chairman of three major studios, broadcast network cable channels and internet companies. i have been the practitioner and a student in the evolution of media over the last 45 years. with civicus broadband internet access and unlimited type of auctions will be available for all audiences. together with the advances in consumer devices like the ipad, it will allow consumers to access directly from producers without middlemen, toll takers,

whenever and however they want. this is the great future of consumer choice and competition. and the realization of generations of public policy aspirations. that is, if we protect and encourage the merkel of the internet which allows anyone to press the send button and publish to the world without having to go through the closed systems that have dominated media since its beginning. contrast that future with the past world of less than a handful of broadcast television stations. this involved in the 1970's and 1980's with the advent of cable television and satellite video distribution but its development was in -- encircled by regulations designed to preserve the incumbent broadcasters. hardly surprising given any technological development that threatens that hegemony is going

to be opposed. along came vitter recorders. when sony introduced the betamax video cassette recorder. this was opposed in a suit by universal and disney. two of the largest producers of programming. they contended no one should have the right to make a copy of their material. courts disagreed and the vcr industry boomed and made way for private on demand consumer consumption through the sale or rental of pre-recorded video cassette tapes, cable and satellite offered all manner of services in -- enabled by the technology of the video recorder. along comes the great revolution of the internet. affecting every pocket of commerce except, oddly, the way most people receive the most popular video programming. even with the restrictive tv

everywhere concept, broadband internet has enabled a few on- line video on demand services to begin a transition to the online environment. this great internet revolution is ready now to provide a new platform for competition that will in turn lead the video packages and all karr offerings driven by consumer choice and device innovation rather than dictate it by the financial interests of the -- a handful of programmers and distribution companies. how that -- how could that not be in the public interest? there are no barriers to entry. creators have the opportunity to make and distribute whatever is their fancy. if intermediaries have less control over the tv eco system, creators will be able to reach viewers more directly and will

not have to sign over so many rights to distributors. viewers would benefit from able to watch vastly more programming in the way they want to watch it. and from having an alternative to subsidizing the current unwieldy marketplace. new technology will allow a more moderate approach to receiving local broadcast programming. right now, 15% of americans will -- rely solely on over the air television because it is difficult to install home antennas or because of problems with a reception. this ought to be of concern to congress which appropriated $650 million to insure that households could receive the signals when digital replaced analog broadcasting. the company has invented technology that allow consumers to get a clear, perfect picture

over the internet and watch live, local broadcast television on any connected device, and ipad, and iphone, or an internet-ready television said. it provides its members with their own antenna capable of receiving high-definition local broadcasts. properly understood, this allows the consumer to outsource or locate remotely an antenna and deevey are and to use that equipment to access the over the air content to which they are entitled. it is d.r. and cloud technology that is the fair, balanced, and unafraid. the consumer needs no other wires or remote-control that no one understands. by making over the air of digital broadcast signals actually useful to consumers, it is bringing forth a very reality that congress sought, the congress invested close to $1

billion in. this is but one example of how the internet can inject competition into the video marketplace. online video is just beginning. it will take all kinds of new products, a lot of failures, it will move these systems from a close to an open environment. it will take vigilance to make certain that neutrality continues to be safeguarded. that no roadblocks or toll bridges can be inserted between the producer and the consumer. my hope is that congress keeps the most watchful eye as these marketplaces dabel. i know it some point soon, the communications act of 1996 will have to be written to take into account the internet which did not exist when the act became law. incumbents have natural incentives to limit competitive threats. congress should be vigilant that

the rules of the game favre entry, innovation, and competition. in the end, there's no stopping technical innovation. i would hope that a wise and engage congress will make certain we have the level playing field and most encouraging and ferment over the next crucial years of its development. thank you for listening. i will be happy to answer any questions i can. >> thank you. our next witness, vice chairman of the nielsen company. you will talk about how american viewing patterns are changing, which is for sure. and more househoulds are -- households are watching online video than other -- ever before. you have produced data about american television that is helpful as we go in to this destructive period where no one

is quite sure where it will end up. >> thank you, chairman, and other members of the committee. you are familiar with nielsen's role, but we also measure where people watch on tv, internet, on mobile devices, but also with a bye in retail stores all over the world. -- what they buy in retail stores all over the world. the average american watches five hours of video each day. 91% of which is done watching traditional tv sets in real time or live. they are not recording on a d.r., using video on demand or even watching a dvd. what has emerged is a simple message. consumers watch their favorite content on the best screen available at the moment.

the watch from more locations and on more devices than ever before. the availability of technnology and the explosion of laptops, and tablet computers and mobile devices has enabled these change. these devices along with a record number of tv's in homes have provided more screens. our latest consumer report provides a comprehensive overview of these trends. my testimony today is based on the findings in that report and the report has been provided to the committee. today, more than 274 million americans have internet access through their computers which has doubled since 2000. in october 2011, 166 million americans watched a video

online. more than 117 million americans access to the internet through a mobile device. nearly half of all the mobile devices used in the u.s. today are smart phones which makes it possible to access the video. broadly speaking, each month, the average american spends 146 hours and 45 minutes watching tv, 4 hours 31 minutes watching internet videos on a pc, and four hours 20 minutes watching video on a mobile device. the use of video on pcs continues to increase. it is up 80% in the last four years. who is using video this way? our research shows women are 6% more likely to view video online than men. largestar-old's is the demographic watching online.

sites like youtube and netflix together, most recently represented 56% of the streaming time which for the average american is four hours and 31 minutes. each month. along with that increase, is worth noting that 33.5 million mobile phone users watch video on their phones which has increased almost 36% since last year. and consumers with this access spent four hours 20 minutes doing this. consumers are increasingly becoming media multitask years. it will use more than one form of media at the same time. recent data shows 57% of smartphone and tablet users in the u.s. check their e-mail and

44% visited a network site while watching tv. consumers are finding and accessing their favorite content on more devices. or screens. consumers are saying unequivocally online video will continue to play an increasingly large role in their media traces. thank you again for the opportunity to join you today.

welcome. >> thank you. thank you and members of the committee. the fcc is about to establish rules for so-called advanced television which was the first significant update to consumer video quality since the introduction of color tv in the early 1950's. the commission established committee. more emerged from the committee. digital video capture and compression had come of age. in the early 1990's, the committee oversaw digital

transmission of digital video. the future was to be digital from the camera to the display. crucial developments occurred. the world wide web was invented. for transforming the internet into a graphic bridge, even -- easily accessible medium. congress overhauled the u.s. communications law. through the 1996 act, maintain distinctions between cattle -- cable and satellite and mobile services and codify the concept of an information service. it was into this year that amazon.com was born. it was an on-line bookstore and grew to offer other media products. requires, all of which physical delivery. instant video service offers customers throughout the united

states the ability to buy, rent, or subscribe to a huge catalogue of videos delivered instantly 24 hours a day. instant video is available on pc's and macs and other devices. it offers more than 120,000 movies and commercial free television episodes for purchase or rental. 25,000 are available in high definition. in february 2011, amazon introduced prime instant video, a subscription video through which members can watch instantly and for no additional cost, more than 17,000 titles selected from the instant video library. this gives our customers an easy opportunity to explore new video content. although we recognize our companies -- customers want to watch video content at their home, they are on the move and they want access to digital video, not just at any time but anywhere. to support that demand, amazon

introduced the kindle fire. this device allows customers to access the internet, read books, play games, and watch high- quality video. and if our customers have questions about the services and the kindle fire, our team including specialists in our wv facility are standing by to help. -- to answer the question in today's title, online video has emerged and will be a key medium of future video delivery. with continued growth, weakens -- believe consumer demand will cause continued growth of video services for an even brighter future. this assumes that the internet will remain a nondiscriminatory open platform. the open internet and kyrgyz innovation and allows consumers to decide whether a product or service succeeds or fails and

this openness is crucial in rural areas of the country where other traces are more limited than elsewhere. the fcc has monitored for competitive or harmful effects but i ask that your committee remain vigilant on this and other issues of internet openness. data er didn't -- [unintelligible] consumer choice without impairment must be conserved. we will assist however possible including if the committee were to take a review of the 1996 act. alliance between the communications services separately addressed in the legislation continue to blair and consumers think of television does not match legal and regulatory conventions. the hearing has drawn important attention to that fact.

amazon.com, inc. believes the future of online video is right for consumers and we look forward to working with the committee to preserve consumer choice. thank you for the opportunity to testify and i look forward to your questions. >> thank you. finally, blair westlake, corporate president at microsoft. you are responsible for the x box at microsoft and that started as a video game but it has gone on to become an amazing instrument. we welcome you. >> thank you for the opportunity to testify in the emergence of online video. i oversee the medium entertainment group out of microsoft. that is my scope and responsibility. microsoft engages with video in several ways, including through our releases of the windows operating system and windows

phone products. i am also here to discuss how the market is delivering consumers greater choice and control over their viewing with online video through our tax fox video service. -- our xbox video service. we're all in the early stages of the transition to the future of video. a few years from now, for an online video offerings will look like a bucket in the proverbial ocean of content. while the current online video distribution marketplace is dynamic and vibrant, the committee is right to keep a watchful eye as content and internet service providers adapt to these changes. the video marketplace is on the edge of even greater change. that will feature new forms of content, greater interactivity, access, and payment choices for the consumers.

let's first consider the present online video market. even five years ago, it was not possible for consumers to access high-definition, high-quality video content delivered over the internet. witnesses represent a few of the businesses creating an abundance of viewing options for consumers. as you may know, xbox started as a gaming consoles. when netflix chose to make its online video service available beyond the pc so it can be viewed on a tv set, netflix did so through our platform. that was a pivotal moment in tv history that has helped revolutionize consumers' viewing habits. microsoft and xbox live service has 40 million subscribers worldwide watching 300 million hours of video per month. internet delivered video enables consumers to access a broad

array of video content at various price points. whenever and wherever broadband enabled device that one. these choices complement traditional cable, satellite, and stelco services. we're not a substitute for traditional video offerings. we have also seen consumers choose smaller, discounted programming packages offered by opty of the mvpd's and may to supplement their cable service with online video offerings such as netflix. a practice that is referred to as cord shaving. this demonstrates the market that is vibrant and dynamic. the future will bring even more change. in my view, the tv landscape will experience more change in the next 18 months in the past

five years. tv will increasingly become a two-way interactive experience. to give just one example, "sesame street" programming will be interactive for children and leverage the power and gesture of the -- voice control. children will interact directly with fellow and cookie monster monster andcookie see themselves on the tv program. tv will be a multi-device experience. consumers will be able to watch all the content want and pay for on any and all their devices. we're seeing production companies create content with mobile screens, specifically in mind. innovation will be introduced into other aspects of the

television viewing experience. example, bing search enables them to find an episode of "mad men" by using just their voice. these are some of the exciting changes on the horizon and the highlight the key lesson. the vital importance of broadband access. microsoft is committed to digital inclusion and affordable access to wires and wireless broadband. as we move forward, policies to promote access to universal high-speed broadband are critical to the health and vibrancy of a market that enables innovation and benefit consumers. finally, the future of video depends on companies adapting to sustainable, innovative business models and management policies that do not discourage or impede

consumer consumption of the vast and innovative online video offerings that are possible in the future. consumers have come to expect. companies are experimenting with transactional video on demand, subscription based distribution, and electronic sell thorugrough models. they enhance and are good for consumers. distributors are developing ways to monetize their services and products. i expect alternative business models will come into view. out with the old, and in with the new. in conclusion, microsoft is pleased to be a part of this vibrant and competitive video marketplace that is rapidly evolving to a future that will give consumers more choice, more control, and better offerings. thank you and i welcome your questions. >> thank you. we will do five minute rounds.

we will keep going until you exhaust. this is to all of you. if you want. ms. whiting notes the popularity of on-line videos growing. we agree. traditional television also remains very popular. i want to understand better how on-line video will compete with pay television packages from cable and satellite companies and my questions, do you believe online video will grow to become a full substitute for pay-tv? willits complete -- will compete with direct television packages that are so popular today still? even if it does not become a full substitute, will it result in down white -- downward pricing pressure?

>> we have a little bit of history to look at in the digital transmission that occurred three years ago. the full digital, many homes kept their pay cable television or satellite. in some cases, it is a matter of switching the provider. what we see is a record number of television in the home which may seem counterintuitive. people love a large screen tv's, high-definition experiences. it is the ease of use that will matter. i will not predict, will we do know is good content, absolutely wins. whether it is user generated or created in other ways. if people divide the right content, it has been supported by advertising or by

subscription. they will continue to produce the content. consumers follow the content. the devices will multiplied. i think it is the ease of use and the ability to watch whatever you want wherever you want it, whenever you want at that we see has supported traditional television programming. it has grown. it is access that matters. other members of this panel may have more insight into the pricing and other things but if we look at consumer demand, people want the content. as long as the content is there, it is a matter of making access easy, simple, and different. >> i do not think it is greg to be a substitute. it is a supplement. -- going to be a substitute. it is a supplement. on-line programming will offer

more all current programming. you talked about having 500 channels by watching 10 but you pay for the channels that you do not watch and therefore, subsidize them. that is our current system. it is a closed system. the internet gives the ability to offer individual programs or discreet packages, or the narrowest of narrowcasting. as time goes on, and we get more television sets naturally in big screen format, connected to the internet, you have this incredible option malini -- auction -- optionality that can come only from the internet. is a closed -- it is a closed

pike. it will not replace television, but it will be up there in terms of consumption, if not exceeding the consumption of pay television over time. >> for now, it is additive. let me do one more quick one. television is incredibly powerful, obviously. informs us or does not inform us. in some way shapes who we are to be. we're talking about the advent of online video and how new technologies can change the nature of television. once again, we go back to i believe that destructive technologies come along when there is something to disrupt. when we have -- when what we have is now working for us. what went wrong with television? or is it just about technology? >> is about technology.

-- it is about technology. >> the medium of tv was pushing information to consumers with the hope they would appreciate it and what it. the internet is a poll -- pull medium. our business model is predicated on a vast selection, convenience, and value. nowhere is this more clear than with the provision of our video services. we want to give our customers the choice to watch what they want to watch, rather than have to watch what was pushed to them by someone in the traditional media. >> i think stepping back, it is about what you define television to be. what we see happening is there is live tv. you're watching when it is broadcast. there is so much now done with

time shifting, with d.r. -- dvr's. and distributed video on your pc or tablet or phone. i'm not sure anything has gone wrong with tv so much as you have this incredible technology change and have -- how to access it. that is what we see happening. it is complicated for everyone in the business to adapt to. it is about the distribution. >> in 19 -- 1960, if the world had the internet, the distribution system would have changed. we would not have wired the company -- country. we would not have put out satellites. we would have done it over this internet ubiquity. >> i agree. one thing that occurs to me, and i am coming to you, senator

demand. the marvel of how we push broadband. and how with the exception of some rural areas which i care fiercely about, it has worked wonderfully and also wireless. it is in a sense of public policy and your innovation has created a perfect playing field. senator? >> thank you. i am curious, if you were still in the broadcasting business, what would you think about aereo? >> i probably -- if i was in the broadcast business, i would do what every broadcaster has done which is to protect and prevent anyone else from getting into it. i would also recognize that part of being a broadcaster was receiving a free license. in return you programmed in the

public interest and convenience. corte to that was that if you had a figure in the air or an antenna or whatever, you could receive a signal without anybody taking a toll or doing anything to prevent you from receiving that signal. that is what aereo does. get a ows a consumer to quid pro quo. >> you see yourself as selling network subscriptions or do you see yourself as reselling content? >> we're not reselling anything. what we're doing is we have a technological platform. >> it is a network. >> it is not a network. >> people can subscribe.

>> it is one to one. you have an antenna that has your name on a. not literally, but figuratively. it is very tiny. your name would not fit on it. you have this antenna and is one to one. it is not a network. it is a platform simply for you to receive over the internet broadcast signals that are free hand to record them and use them on any device you like. >> the broadcasters -- to broadcast that. you are going to in effect capture that and resell it without a license. we charge of consumer for the

infrastructure we put together for the little antenna and for our the bear caught service. that is what the consumer is paying for. the consumer does not have to pay. we do not charge for programming. -- that is broadcast -- >> you are a distributor. >> we are not. sorry. i would like to agree with you on something. we're not a distributor. we are not disturbing except if you say that what we are doing, if you would call an antenna at that british textiles and consumer for, a distributor, it would be analogous. >> if amazon -- if businesses

could enter cap -- intercept signals and sell them -- >> the system for broadcasting, microsoft could do it presuming in redmond, where there is a tv signal that they offer the same kind of platform that we would offer. the system of broadcasting transmission is local. it is one to one. the local broadcaster sends out a signal and we provide an antenna to receive it and put it over the internet and allow people to record it. >> ok. mr. meisner. do you plan to intercept broadcast signals and sell them over your network? do you sell them as part of your content?

do you see that as a legitimate thing to do at this point? >> thank you for the question. we currently do not offer live programming in our video service. we do not know what the future holds for other businesses. we're about providing our customers selection and choice. 120,000 available movies and tv episodes. >> do you license those ordeal was the copyrights? with everyone who owns them? >> it did not see yourself as a competitor to traditional pay-tv services like cable or satellite? >> lericos partners with the studios to produce content. >> do you think cvs or walgreens has the right to charge for an in dial -- more foreign and dial

display than they do for a position on the shelf? >> i did not follow the question. >> did you ever see an in dial display? do you think retailers should have the right to charge more than they do opposition on the shelf? >> the products and services that a company -- >> this is a question about a grocery store. do they have the right to charge differently for displays versus cell space? >> they do. >> that is what i want to know. >> thank you for this hearing. the witnesses combined, three of you employ 100,000 people related to washington state. thank you for that and thank you for continuing to innovate in

the business models. while we could have discussions here about a wide number of issues from neutrality and on- line distribution rights and piracy and privacy and what the fcc is capable of doing and not capable of doing, simplicity, one of the things i wanted to discuss was or get your input on is as we're talking about business models related to entertainment and the changes in what congress needs to do. there is one incredible opportunity with the advent of online content and distribution. that is in the area of education. when you talk about two way devices. what you see in opportunities in education. health care is another

application. but education we're just about every university could put content online and change the dynamic and access to education. the fact that you can make educational material so available. you made a habit of staying ahead of business, making sure you do not fall subject to business models as they change. what do you see as the opportunities for this content to be made more readily available to the american public? we know one of our biggest challenges as a country is making sure we have a competitive workforce in driving down the cost of education. anybody on the panel. mike understanding is -- my understanding is two-way communications as well.

there is the limitations, but with kinect, you are interactive with individuals. >> that is correct. i look at the "sesame street" program as a catalyst. this is technology, kinect is an accessory that attaches to the xbox and has the capability of detecting voice and motion sensing as well as a video camera. what we have done is commission 50% more programming to be shot, integrating it with the production of the sesame street program that is produced each year. it produces 40 hours of linear program.

taking the additional content, children are able to interact and can throw a ball toward the television set and the ball magically appears on the television set. as though -- as though it fell into their television set. we see this as a seed for showing others. it is at the beginning of the stage of being able to have producers produce the content that is available for children to be used in this fashion. the same with health care. there are a number of ideas that could be used for this technology to bring healthcare content. >> on-line technology does not

transformed tech -- education, it would be a crime. it is beginning to do so. we have only had broadband for just a few years. the ability to have rich video transmitted is a recent phenomenon. we have things like khan academy which is a wonderful service. we have online, like kaplan's online university which was has -- which has 100,000 members. everything is going to be online. there are healthy potential business models that are going to support that. it will have a profound effect, profoundly positive effect. it will finally get some competition from lively, creative competition in education, how it is delivered,

what its products are, etc. i would say i cannot imagine it will not be transformed. >> thank you. >> thank you. >> thank you. this is the technology, the technology is remarkable and amazing. we are trying to keep up with what is going on out there. as you can tell from listening to us this morning. i am curious to know and this is for anybody on the panel. there are studies that suggest streaming accounts for about 54% of internet traffic in north america during peak times. netflix and youtube account for 36%. that leads to a question. do we have sufficient infrastructure and bandwidth to support the increased demand for

high-quality online streaming services, and what are the foreseeable issues that arise from our interest structure in terms of this -- a demand and availability of online video? what should congress be watching for if anyone would like to take a stab at that? >> thank you. the court characteristic of the internet is that consumers are allowed to pull to them information they seek. it is about consumer choice. the information does not get into the water unless the consumer asks for it. consumers are driving that growth of online video. consumers are demanding devices like the kindle fire. they are demanding the broadband delivery of video services. so long as consumers are able to make that choice in the future, so long as the networks remain open to the consumer choice, it will be a bright future.

they will decide what they want to receive through the internet. in terms of capacity, is there the infrastructure to handle this? does anybody see that as a problem? for future growth of the industry? >> it is going to be a problem. we do not have a first-rate broadbent infrastructure. we are slower and less deployed than 15 or 18 countries. we're beginning to strain at capacity. and so all the efforts to free spectra, the efforts should be mandated for the widest broadband coverage is mandatory. one way or the other, it will get soft. it would get -- be nice if enough spectrum is offered and

enough bidders bid it up to what they think is a fair going rate and they bash each other in competition for which there is relatively little right down and the potential is for transmission rates to be lowered which would be a good thing. >> you mentioned in your testimony, you talked about broadband being ubiquitous and as someone who represents a rural area, their places for that is not true. i think of the reservations in south dakota. thinking about how what efforts we made -- we need to make to make sure we are including rural americans in these video business models of the future. seems like it is a bit -- ubiquitous but there are a lot of places that do not. a question having to do with this issue of cord shaving.

you mentioned where consumers elect to have basic cable and supplement their subscription. there are content providers that will have an opportunity to sell to the consumer which would allow them to bypass cable subscriptions. many of not all the current online streaming models advocate cable subscription. it cannot watch hbo or espn unless you have a subscription. what is stopping espn from selling their content to the consumer or the nfl to sell to the consumer? >> in terms of each of these companies, they can make a decision whether they choose to sell directly to the consumer.

do i know of any impediment? there are no impediments. this is a decision they make. some of these services are selling directly as well as on a [unintelligible] basis. some have and some have not. i would expect there will be more services that are offered directly to the consumer. >> it would be insane for espn to sell itself directly. right now it is selling itself to me. i do not watch it espn. i call it -- i pay god knows what for cable transmission. i am paying for espn. 100% of subscribers have to pay for it. to salih individually -- sell individually is something they would avoid. >> thank you. but time is expired. thank you.

-- my time is expired. thank you. >> thank you. thank you for holding this hearing. testimony,. diller's incumbents want to protect themselves and we need more destruction. i agree coming from the telecoms side. i am trying to get my head around this new model where we have on one hand, the content generators. in the traditional model, we have protack -- broadcasters that have some level of public obligation because they got that free license or they negotiated with the local community. we have got this how you do distribution through cable over

the air or broadband or network providers. we have this new -- you are in between the content crater and the distribution system. the question i have is we have placed in the past program access rules or other responsibilities on the network providers, some restrictions or rolls around the content entities. what should be kind of the policy ramifications for you? what set of rules? should we get to the notion of how to redefine whether it is a distribution network, what

should or obligation be and what policy restrictions, for remarks should we put around you? i am not sure that is the clear question. >> if i may, i think vigilance is most in the area where there is most competition. at present, there are a plethora of content creators, of content distributors, and consumers. conduitsn't not many by which the content can get from producer and provider to consumer. that is the area that requires most vigilance. in this context, maintaining an open internet is crucial to the provision of these competitive services and consumer choice i believe we agree is the right policy. >> not to be presumptuous but

you have to write the communications act of 1996. it is overdue given the internet. it needs revision. this started with broadcasting 80 years ago. the rules that protected broadcasters and the rules that enable cable television, there is and new entrant. the new entrant is a health the entrant is the internet. and so i think the rules then and now need to reflect that there is a potential positive competitor to what has become as you stated earlier, a very closed system of program content makers, people who organize

networks, whether they be pay networks or whether they are advertising supported networks and subscriber supported networks rather than pay-per- view. these players are in a system where there is no air. there is no air because it is completely closed. dominated by relatively few companies, less than a handful. i do not think those companies are going away. my goal is not to make them disappear. but i think the internet allows for competition. >> let me ask you. my time will run out. i agree. we have to push more access, more conduits. what obligations should you

have as a way to take the intermediary between the content creator and a distribution system, what obligation should you have in terms of paying for the amount of content you push through these pipes and should we be distinguishing between traditional sources, cable broadcast, wired, where the -- wireless? >> i would say a level playing field is mandatory. the rights and obligations people have are across all these arenas. >> [inaudible] >> absolutely. the profit margins on data transmission are in the 90's. it is not exactly as if these systems are not going to be billed out. they are being and they're being

added to every hour. i do not think you have any worries about that. >> the reach of broadband is the essential part. we will not have had -- have a problem getting to be content. wide access is essential. the creation of content is growing exponentially, the volume and the innovation behind it. >> senator klobuchar will be called by senator hiller.

you, mr. chairman, for holding this hearing. i think you know the ftc national broadband planned talks about getting broadband web pages and photo and video to everyone. these beans are not as fast in rural areas. can one of the -- the speeds are not as that in rural areas. can you talk about making your services available in rural areas? >> we are certainly encouraging wider access to the ftc for minimum threshold.

at that point, we feel in terms of what we can deliver in terms of high-quality video and high definition quality video, that since the needs of what we have in terms of giving consumers what they need. as far as being able to facilitate that out to the home, that is not a business we are in. >> we believe we are helping to provide the bellevue proposition for the build out of that broad band. -- provide the revenue proposition for the build out of the broadband. that makes it more valuable for consumers. consumer demand will drive be billed out of broadband. as important policy oversight, i am a big believer of that. whorl areas will benefit from internet -- rural areas will

benefit from internet bdo. >> how about the disparity in equal access to low income households? how does that fit into this? >> i would say that accessing -- access is going to be increasingly available as the broadband infrastructure becomes completely ubiquitous, but also has enough price competition to allow it to be available. what the fcc is doing in terms of using the old telecom funds to finance build outs in rural areas is great.

we need a national policy for broadband. everyone will be affected by it. we need to have as good a system as there are -- as there is in the world. right now, we do not. >> what about the local news? it is for getting people through tornadoes. what is the role of local news as you see the video marketplace? >> local television stations were going to be outmoded. in all of these new development areas, they will be antiquity. i have always felt otherwise. the strongest local television stations are the ones that provide the most news and information and community programming.

i think that continues to be vibrant. if you look at the success of any television station in any market, they are more dependent on their ability to deliver news than they are having a hit television program of the moment. >> based on the greater seattle area -- i live in seattle -- the local stations are utilizing online for a depth of local news that is not practical on air. there is barely 10 minutes that go by in the broadcast of a local independent or philly a station that does not refer to their web sites for more in- depth video footage. local content remains the most

-- first and foremost for were consumers go. we are seeing just the beginning of it. you will see those local station adapt to this video apps that others are doing and it will only proliferate. >> one last quick question. your gender breakdown is always a good topic to end on. you have the tv viewers 51-49, women watch more tv. online, women beat all men 50 -- 63-47, 50-50 for smartphones. the tablet owners are the only category where the men are ahead. where did you see that going? >> no, i do not see that changing. >> why is that? >> we see broad distribution of

video and use it on every device. if you mean do i see the tablets -- >> there is a man up there with a tablet. [laughter] >> that is mainly because it is a newer device. >> the women wait to make sure it works. >> i was going to begin my testimony with my iphone and my blackberry and might pc. i think it is the timing issue of the distribution of the devices. >> senator heller. >> i want to thank the panel for being here. it is enlightening to hear your comments. i assure you my question

probably run to write down that line. -- runs right down that line . i hope we talk about the communications act a little more. i hope we hold an oversight hearing on the fcc and discussed some reforms i have introduced. that would be my request. i would also like to submit a statement for the record, if that is okay. like all of you, i marvel at the technological advancements and innovations that have taken place in the last 15 years. and on regulated internet market has been a dynamic force. unregulatean internet market has been a dynamic force. are laws passed in the 21st

century outdate it in relation to today's landscape? -- outdated in relation to today's landscape? they should do this while remembering that content should be protected and compensated accordingly. focusing on the loss on the books is a discussion for another day. i am hopeful our panel can provide us with an outlook of where we might be headed with content distribution and what consumers may expect around the corner. one of the great benefits of being an senator from the data is the conventions that come to my state. as the consumer electronics show. these gatherings are always informative because they

showcase what is coming down the pike for innovators and consumers. knowing where we are going is helpful to me because the last thing i want to do is stifle that innovation. with that in mind, i would like to ask the panel an open question with regard to the wing content. where do you think we are going? do the laws in existence help or hurt us from getting their? >> i said it earlier. where we are going is obvious. we have a new radical revolution in communication called the internet. more is going to transfer, not completely. more is going to utilize the capacity of the internet to provide more information, more services, more programming.

the laws we have -- the 1996 communications act -- do not address the reality of this new force that has only been going on since 1995. >> senator, i would add a couple of things. we see a trend of people using multiple media, multiple devices simultaneously. more and more people watch television while they are using their tablets or their pc or their phone. that only leads to the need for more broadband pretty -- more broadband. we see more multitasking. we see people wanting access to their favorite kind did, their news and information wherever they are.

on the best device possible, wherever that is. on phones in particular, smartphones have wider and wider penetration. that is a video device or any of the different kinds of content we are talking about. that increases as well. they complicate -- compliment each other. people are using multimedia. those are the trends we see in the next few years. also the innovation people are talking about. i will leave the experts for that. >> senator, the distinctions drawn among different communications services in the 1996 act in the 1934 act before, the 1992 cable act -- those distinctions have blurred significantly over the past decade or so. i would be happy to work with

the committee to address that blurring on how we can update the law to reflect the business models that exists today. >> my time has run out, mr. chairman. >> you do not have to apologize ever for 29 seconds. senator pryor? >> indeed, the lines are blurred. it is unclear where a lot of jurisdictions began and where they end. i have said this before. i have said that we were behind the curve within six months of the 1996 bill being signed. we did not think hard about data transmission. a hearing like this is important as we think about the role of

government in the market going forward. hopefully, it will help us understand how we americans are to engage in the creation and consumption of video in fair terms at fair prices, as well as the role that competition is going to play in those choices. i do not think we have tapped the answer to that, to be honest with you. you mentioned it a moment ago. ms. whiting, the floor apparatus that you lead. it is normal -- the four apparatus that you mentioned. it is normal. digital technologies have shaped the video landscape. youtube, amazon instant video,

facebook, netflix. they have made it possible for hollywood to distribute television and movies over the internet and for the rest of us to produce and distribute our own video. from the innocuous and silly and personal family oriented things to the joseph kony video, which had a profound impact and had over 180 million hits over time. now the smartphone and the tablets folks make it possible for people to capture video not just on your television or your computer, but anytime and anywhere. it is a brave new world. it is a whole new deal. most of these services are riding on the wireless investments of a group of companies, satellite, cable, television folks.

now they are using their broadband capabilities to put content out in new ways such as the comcast microsoft x box set up. a lot of us are trying to figure out what the principles are that guide us going forward. mr. chairman, i think it is critical that whatever we do, we helped to grow and to empower and the enable this innovations. that means, on the wireless side, we have to do a better job of managing and releasing the spectrum. the deal takes up more bandwidth. on the wired side, we need to be pushing out broadband networks to underserved regions. we have had policies put in place. president bush, in 2003, said we

would have a policy to have everybody in america wired. we are light years behind that, in fact, dropping behind other countries. we should take note of that. if you want to talk about american competition and preeminence in the marketplace, it is going to be dictated by some of this. we are not doing what we need to do by any sense of the imagination. finally, we have to protect net neutrality. that is critical. we fought back against one effort here in the senate to on do that. undo.in -- to that. i remain committed to enhancing that marketplace and making sense out of it. consumers are bouncing off of the walls right now. in other ways, they are benefiting enormously through

the increased access and different appliances. we have to be careful not to nip that because of its power in the marketplace. let me ask you a couple of questions, if i cano. one, i might ask mr. diller. given your success of the marketplace and the knowledge you have of this, what would prevent you from going out and creating your own fox network or some network or any other name you might attribute to it? >> i would pick a new name. >> pick a new name. your own network. an individual network outside the broadcast and cable world and distributed through the cable world? >> absolutely nothing.

the wonderful thing about this miracle of the internet is that you literally get to make up whatever you want, pressed the send button, and published to the world without anybody between your effort and the consumer. it gives you an absolutely open possibility to create anything. we are at a very early stage. we have only had video for a few years, that ability to transmit rich pictures over the internet. there is no question in my mind as time goes on and consumers get used to the same degree that they are used to be one click on amazon, if you have something you can offer it to them in a patent system in a way that they can understand and will be able to -- in a payment system in a way that they can understand and

will be able to access easily. it is the greatest opportunity there is. >> in that context -- we do not have a cable or broadcast representation -- do they have an incentive to try to limit the growth of online alternatives? >> thank you, senator. i cannot speak for them, obviously. we have seen indications that they may restrict the availability of computing content. that has to be monitored vigilantly by the commission and this committee. >> we should probably look carefully at that playing field? >> at amazon, we start with our

customers and work backwards to figure out what they want. in this context and in congress's role, we look at the citizen consumer. what would they want? i believe they would want as much choice, as much selection, and the great his value and convenience as possible. as we look -- and the greatest that you and convenient possible. we look to see what they want as opposed to what the industry's do. -- what theical a -is- industries do. >> how critical is net neutrality? >> it is that parity and the need for the national broadband policy that gets us, if not

number one, i would not settle for no. 2. -- number 2. net neutrality is mandatory. there is no question that without it, you will see the absolute crushing of any competitive force. it is just not going to be possible if you say that distributors can put it cancans -- tin cans and anchors or rounds distributors who want to distribute content the -- around this tip is to want to distribute content that they do not own. >> i could not have said it

better. >> the final question, and if i may. as we all know, hundreds of thousands of illegal movies are downloaded every day. one could blocked that by preventing people from getting to the sites that screen the video. nobody wants to impede people from going where they want to go. is there, in the current copyright or propose copyright law, both civil and criminal, too little protection and too little -- and too much constraint on an elevation or is the balance right-- on innovation or is the balance right? where do we come out on that? >> we are in the business of selling the did a bad product. we fundamentally at whole or

-- abhor piracy. if there are ways to get at those kinds of copyright protection issues, we would support that, senator. >> copyright protection works pretty well right now. there needs some strengthening outside the united states -- there needs to be some strengthening outside the united states. that would be helpful. s.o.p.a. is not helpful. it is a ridiculous over reach. >> this is something we need to follow up on. there are a lot of sidebar issues to each of the questions i asked. i look forward to working with each of you closely as we work through this. thank you. >> thank you senator kerry.

>> senator pryor. >> mr. diller, if i could start with you. senator kerry asked you what would prevent you from starting your own thing on the internet. you are excited about that. it is exciting. i have a question about regulation and what regulatory environment there should be out there. for example, we recently passed the 21st century communications guyot accessibility act. -- communications accessibility act. one of the examples we gave was when folks are watching a movie like the wizard of oz on line and it does not have to be

closed captioned. but it is on television, so it is. those are regulations that do not in french -- infringe much, but it provides -- but they provide access to everyone. technology has changed so rapidly. we have not been able to keep up. what is the balance in this legacy regulation. you are comfortable with all kinds of regulation? what is the balance as we moved forward? how much regulation should there be and how it will shed those playing fields be? >> i think regulation should be relatively light touch. given this powerful mass

communications, the engines and such, there has got to be the level of playing field that can be legislated. at the same time, there are all sorts of legacy obligations that broadcasters took on, that satellite companies took on, that should now be covered and included with the internet. and the issues of the internet. i do not think it is that hard to do. the last time around, the 1996 act, took a lot of pluck and preparation and in the snow is was heard. not that that -- and in less -- endless noise was heard. because of the internet and its

ubiquity and its adoption has changed so many things naturally that amending the act for the future that includes the internet and the reality of the internet will not be that problematic. >> do the other panelists have any comments to that? >> i will respond on that. we are working toward the implementation of closed captioning. the volume of content that is flowing and the amount of data associated with closed captioning is no small task. that is our goal and one that we treat seriously. >> let me ask this question about something that senator kerry alluded to, international -- intellectual property. given the ubiquity of the internet, it becomes harder and

harder for folks to own -- spoke who own international -- folks who own internal actual property to enforce that -- folks who own intellectual property to enforce back -- that. >> at amazon, we have been working with rights holders to insure their legitimate product is made available to the widest range of consumers. we provide them with a legitimate products. the 120,000 videos that are available on amaziah instant video were all obtained with working with the rights holders. we respect their intellectual property rights. >> good.

one last question -- i know you look at this date all the time and see how people are behaving. do you think back -- one of the things this committee has been working on is trying to get high-quality broadband to every american that wants it. it is particularly challenging in rural areas. do you think that as more and more content is available online that that will incentivize people to get broadband? especially in the rural areas? >> it seems like a logical conclusion. so many of the things we talk about with content being available on a fun, will lead to more people asking for broadband and requiring for that access.

that usually leads to a commercial discussion of making it available. >> that will lead to the discussion of affordability and trying to get it deployed. one of the concerns i think this committee has expressed over and over is we do not want two americas. we do not want urban to have the latest and greatest in high-tech stuff and rural to be left behind. thank you very much. >> i would ask that the offering of all this additional video, which really requires that broadband capability, which i have mentioned before as far as the threshold that the fcc has stipulated -- my impression in dealing with internet service providers is they are looking for ways to be able to offer broadband to more households. it is, frankly, a good margin business, and as people see more and more of this content, the demand goes up. as typically occurs with most

businesses, as demand rises, the business is see that void and try to fill it. i think the increase in video content may well be a catalyst for it. we hope so. >> thank you. senator, you have been such a champion for rural america. as you know, the fruits of your labors in getting broadband -- the fruits of the chairman's laborers in getting broadband out into the rural areas have helped my state enormously as well. a lot of people do not think of florida as the and roll, but there are vast portions of florida that are. having done a number of town hall meetings in rural parts of the state, i must say that now as a result of the stimulus bill having put money into

expanding broadband into the rural areas, which is now just occurring, that is being greeted with exceptional excitement and approval so that basically, as you say, that we do not have two americans, that the children in rural america have the same access that children in urban america do. i wanted to ask a question of ms. white. i was fascinated the other day when a senior member of our staff said to me that she does not watch television anymore, that she gets all her information basically from either her computer or from her aunt had -- from her ipad.

how in the world does nielsen, which has refined the technique so well of determining how many iphones are watching a tv set with your electronic boxes that measure it exactly -- how in the world is nielsen adapting to determine how many eyeballs are watching content on the internet? >> thank you for the question. we have obviously had to adapt. as we just talked about, if we want to follow the audience of a program across any screen, we have to measure that, and we do that for programmers and advertisers. we use technology to do that. we recruit samples of consumers who let us measure that. there are a growing number of

people who do not own -- there are contradictionss going on. there's a small number of people who do not own a tv set. they tend to have a smartphone, and they are getting their content and information that way. you balance that with households that now have four tv sets and their pc's and every other device, and our task -- programmers and advertisers really require it -- is to measure the programming across that. technology is our friend. we use technology to help us measure, with permission, the behavior on all those screens and samples of people. it is possible and we are doing it, and i expect we will continue to have to innovate because there will just be more screens. >> tech -- will technology refine your technique with regard to television screens?

because you can put a box on a representative sample and then determine who was watching what program. how do you do that with a hand- held computer device? them a very specifically, it is usually a software application that we basically recruit someone to participate -- >> there is specifically. we download either a software application or we measure a commercial in a program, and there is a code, and we pick it up if you are part -- basically, it is code recognition. it is technology residing on whatever the equipment is. it is not a separate box. it is a way of understanding behavior with your permission. >> how do advertisers understand that they are being

charged appropriately on the internet as compared to the satisfaction and confidence that they have in the number of our balls that are watching a tv program because of you? how are they being satisfied that they are being accurately charged a fee for their advertising on the internet or any way that is distributed through an internet-type program. dam it really simple measures advertisers are looking for -- how many people or where exposure did my at have? they have estimates for television. there are a number of different ways they can get those estimates for online display ads. search advertising, they get feedback. we provide it.

other companies do. the major question we're getting now from advertisers is to understand across the screens how an ad campaign can be effective, how to balance the money they put in. that is again done recruiting panels, using technology to measure, the same kind of way we do in television and exposure to an ad, and then there is effectiveness. but there are many ways because you have website information and other technology that people can do that. we have similar methods to television. the big question that is happening is trying to understand how they complement each other with tv and the internet. >> if i use myself as an example, a tv program goes dark and an ad comes up -- maybe my mind is watching it or not, but that is what is filling the space. not so with an internet screen.

i may be looking at content on the screen on and i had, and there is an adjacent ad, but i'm not paying any attention to that. how do you go about measuring the effectiveness of that compared to a tv program? >> we actually use a method that involves both understanding -- the panel we have recruited has the ad of than on the screen, and then recall after the fact. certain measures we create for recall and impact of the advertising. it is a combination of things, along with demographic information we have. we can say cassette in this ad was used by an estimate of men 18 to 49." additionally, we look at the impact and the recall, and we do that for a number of major advertisers. >> do you find that the recall

for internet adds is much lower than the recall for tv ads? >> it depends on the creative. it depends on the placement. in other words, the actual ad, the placement. what we do find is that ads shown on both television and the internet have much higher recall and much higher effectiveness when they are combined. that is something many advertisers are studying with interest. >> senator, i would and also to the point i made in my remarks about innovative business models and new offerings that various content companies, which obviously use advertising as part of a way to fund the programming, are experimenting with ways -- wider at loads, for example, shorter ads. to my comment, out with the old, the new ways online video is

being delivered is not just the means by which the content is being delivered, but the way in which it is offered up as far as the price point for access to the content, the ads deliver pre-roll where you watch an ad before. a number of things are being down, putting aside the actual measurement, which is not my expertise. some are finding it, from what we hear, extremely effective. >> thank you. i will ask the final question, there being nobody left. i will have to roll several into it. you were very interesting the way your answer the question because you really hesitated when you talked about the effect of technology leading to rural coverage. i mean, you had an answer, but it was a while in coming, and i thought that was honest, and i

have to agree with that. the business of when rural space senator's talk about rural people or poo people in ar places, and people talked about they are just pandering to their constituency -- it is really not at all the case. this is a basic american precept. everything has to go to everybody. that such a fundamentally american concept, and also a concept which is still probable -- can be probable with this proliferation of platforms in delivery areas. however, i think this committee has done a very good job in three areas of all this, and that is houston with wireless the second day and was completely -- every classroom

was done on the third day. others did not do that, so it was a much longer process, but now, it has worked. there's always a starting point for connectivity. i think we have pushed really hard on, as senator nelson said, broadband. through the stimulus package, which some people say they never want to see the likes of that again, and therein lies the problem. because what we have done in broadband as a matter of public policy may have reached its point of no return. then i think we have done also a very good job in wireless. but a lot of money into wireless. on the other hand, we have not done that by ourselves. but with all of these things going on, all i can think of when i hear about rural america -- and then going to think about the rural part of florida, not

west virginia, just for the moment, so i appear to be more honest in my question. that is that for the most part, it has been the business of telecommunications companies up until now. it has always been wonderful because there are lots of mergers and lots of conditions. the conditions always include precise -- you have to go everywhere and cover everybody. telephone companies that have rolled over west virginia over the years have all promised it but had done nothing about it. yes, they have incrementally moved things further, but if you talk about driving down any interstate in west virginia, you have to memorize the places where the interstate rises high enough that you have cell phones service, which is humiliating in the modern world -- that is our world.

so i am on fire on the business of if we're going to have this explosion of technologies, which i totally welcome, and i welcome it for several reasons. one is that i think this is -- this explosion of technology and capacity to see, learn, listen, watch the be the salvation of the older generation. you read so much about people alone. they do not have friends and cannot communicate. all of a sudden, they have all the friends in the entire world. they could make 25 friends every single hour if they wanted. but the problem is they still have to have children in their household, but most of them do not. so the problem is how did they come to the marvels of this new way of watching, learning, going

back to 12th century british history and finding out marbles of how people actually builds cathedrals back then. you know, the stonemason process. how could they do it? this is all interesting stuff, exactly the kind of thing which gives them motivated. and then the whole news factor. i also have a big problem in question because news outlets are diminishing. i think there is 180 person left in charleston, west virginia, which is our largest city, and capital, and newspapers are getting smaller. the "post" is getting faster and easier to read. as is the "times." and television increases. news is now doctor, and local news is that a little bit less than cnn and m foxeds, then

etc.bc -- news is now ,got local newcha a little bit less than cnn and msnbc and fox, etc.. believer in net neutrality. i want everything to go after everybody. i do not want anybody stopping anything. we have not really dealt with caps because at some point, you cannot create spectrum. you can buy it back or give it back, and then the fcc can sell you something, but the streaming eats up a lot of megabits really, really fast. my question to you is, have a neatly wrapped all my complaints into that -- what is going to

happen in this new revolution, which is going to force not just the telecommunications companies, but others who are in the game out to get it out to people who are not asking for it? they are not asking for it. i do not believe they are. i think when they knew they could have it and overcame their fear of doing it and had access to getting it -- although you might sell with connectivity. they could go down to their local public library. there's a connection down there. i think it is going to be a really tough slot, but it is the classic american requirement of this new explosion of possibility. i have absolutely no idea who i ask that question too, so i will just as it to barry diller. >> thank you so much.

i think just like a long ago, phone companies were forced -- they had returned from their monopoly, that they had to -- in return for the monopoly that they had to connect every place that existed. >> but they did not do it. they went to the cities and with the business was and where the prosperity was, and they got all of that. >> and morgantown and all those places are happy, but out where people mine coal, with everything that, and in rural parts where i live, you cannot get anything. >> i had thought phone coverage was pretty much everywhere, but if it was not then is not, then its replacement, to a large degree, which is wireless, and broadband -- it should be the policy, i think, of this country

that every place must have the ability to receive both wireless and broadband connectivity. that ought to be our lot. we cannot compete in the world with the 16th or 18th best communications infrastructure. >> you are talking more broadband then you are wireless. >> wireless as well. but by the way, you speak about if you go too low in parts of west virginia, i promise if you drive around los angeles or new york city or seattle, you will find lots of drop calls, lots of places where there is spotty coverage. to begin, we've not had enough competition or enough national policy. >> how does national policy do this? in then to be in love with

national policy, and i've seen these national policies, but it is always the people who make the money would decline to get it out there because it is at the margins. >> we build a highway system in this country, which we did in the 1950's, i believe. that got done. why is this so impossible for us to organize a system where it does get done? >> because that was an executive decision approved by the congress in a much simpler time. this is an explosion of technologies which so many people are just barely holding on by fingertips, particularly the more rural you get. inner-city is the same thing. so who is going to push this? >> i'm sitting here pushing it. my colleagues will push it. most of the people in this room, i think, would push it.

if you ask anybody, they will say we want competition in communications infrastructure. we want it to be universal. we want it to be the best in the world, and we will support it. >> do you understand what it feels like when you go to a place called upper big branch somewhere, and they have just had a big explosion and 29 miners have been killed, but nobody's quite sure of that debt, so everybody is gathered around the portals as close as they are allowed to get, and everybody is trying to dial their mother, their son, their grandmother, etc., in detroit, and they cannot do it? charging up the road comes boatload after boatload of wireless polls from verizon -- landline polls -- because the

air goingp to sellol them upe -- s see what i mean? any kind of role mishap. i.t. and health care is helping a lot on this on that particular aspect, but the general availability and accessibility remains very much on my mind, and i worry about it. >> i sympathize. that any concluding comments? >> mr. chairman, i guess what i would weigh in with is that a balance is required because it is a combination of factors, like anything. most of these companies at the table are benefited from the very notion of having wide distribution of broadband on many levels. anything from the very basic for us to pushing up updates to our operating systems to the delivery of entertainment. so they are all essential. the reason we supported the decision on that neutrality was because it was a balanced

decision. as you evaluated -- i did not know that i will have the last word, but the last one of the closing thoughts is to balance those interest because the companies that actually build, a woman this are in a better position than certainly i am or we are to assess what all is involved, but it is really looking at that. it is a balancing act, and as we evaluated that, we realized just that, that you have to take into account the innovation opportunities, and delivery of content. i believe as more high-speed content is delivered, i would like to believe there would be an incentive for the investment made to deliver that broadband, and it is essential for this country that whether we are 18th -- i know we are way down the list, and that is something that is -- whether it is delivery of education, which is fundamental all the way to the more mundane

and education entertainment, it certainly where we are headed. >> may i make a car robbery in common? >> is there a possibility that you will not make a corroborating comment? [laughter] >> i just want to say if it is any consolation, the highest point in florida is 350 feet, so not a lot of hills and valleys, and very spotty coverage, but as mr. diller says, in any urban area, it has crossed every one of our thoughts in the middle of a very important cell phone conversation and you lose it, and you wonder why they do not have this problem in third world countries on this planet.

i would just like to throw out a final thought that we need to consult with folks like this on getting what should congress do in the updating of our video and communications laws, given the fact of the subject of this panel today. >> thank you. >> you have been a superb panel. we have -- many ideas have been thrown out. frustrations have been thrown out. the opportunities are endless, so it really is the most exciting time in telecommunications since i came here, so i congratulate you all for being a part of it and for being warriors in the war of the roses. this hearing is adjourned. >> thank you. >> thank you.

host: [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012] >> we are at the national public radio -- with the national public radio table? [applause] you guys are still here. that is good. i just remember when we landed on that. >> later today on c-span, the 98th annual white house correspondents' dinner. president obama and late night talk-show host jimmy camel headline the event before an audience of celebrities, journalists, and the white house press corps -- late night talk

show host jimmy kimmel. you can watch the entire dinner on c-span and sync up your experience online. c-span.org/whcd. the white house correspondents' dinner -- live it 6:30 eastern on c-span. >> it is the only world he had ever known. born in 03 and work hand. he is also the only one who ever escape from camp 14. >> his first memory at the age of around the for your was going with his mom to a place near where he grew up in the camp to watch somebody get shot. public executions in the camp were held every few weeks, and they were a way of punishing people who violated camp rules and of terrorizing the 20,000 to

40,000 people who live in the camp to obey the rules from then on. >> sunday, an author on the journey out of north korea and warning about society and "q&a."ation on c-span's may 6, an interview that coincides with the release of "the passage of power, the fourth volume in cassette in the years of lyndon johnson quarter made his multi-volume biography of the 36-president. >> i of the asteroid can systematically and routinely buy their way out of public services and publicly-provided goods, do they not lose a stake in the public sphere and in the quality of those goods? >> mercenaries can be paid to fight wars. students can be paid to get good grades. you can wait to jump to the front of the line. sunday night, harvard professor

on what money cannot buy, the moral limits of markets. this weekend on c-span2. >> this week, a look at how police are using cell phones and other technology to search for criminal activity and whether current law covers cell phone tracking. the american civil liberties union issued a report on the subject after studying the records of hundreds of police departments. >> over the past year or so, there's been a series of police actions regarding cell phone tracking, shutting down of cell phones towers, the use of drones domestically, etc., and there been a series of news articles about these topics, and that is our topic this week on cassette in the communicator's." technology, the use of technology, and police surveillance. joining us from our new york studio is katherine crump, a staff attorney with the american civil liberties union --

catherine crump, and also josh smith of the national civil liberties journal. if we could start with the use of cell phone tracking by police departments. what was the report about? >> the aclu has believe for some time that police departments around the country are tracking people cell phones on a routine basis, often without getting a warrant based on probable cause. that is what we thought, but we were not actually sure. in august, 35 affiliate's in 32 states around the country filed a total of just over 380 public records request from specific law enforcement agencies asking about the policies, procedures, and practices for tracking cell phones. the report we put up earlier this month documented the findings from that study. >> what did you find? >> we found that virtually all

law enforcement agencies who responded to our request engaged in cell phone tracking, that it is in fact now completely routine surveillance tool that is just comment in the arsenals of law enforcement agencies. moreover, we found that recently, law-enforcement agencies track the location of cell phones without getting a warrant based on probable cause, and that is a concern because where you go can reveal a great deal about you, and we do not think it is the type of information law enforcement should be gathering without getting a warrant based on probable cause. >> are the police departments doing this based on some federal or state legislation, or are they doing it through the lack of legislation? >> there is legislation that governs electronic privacy in this country, but unfortunately, it is often quite out of date. the federal electronic communications privacy act has not been meaningfully updated

since 1986, which was before the world wide web was invented and a long time before most of us had cell phones. unfortunately, under this law and also under the constitution, it is not exactly clear when the government needs a warrant in order to attract someone using a cell phone and when that actually violates a person's right. i think because of this void in the law, law enforcement agencies are frequently tracking people without getting a warrant. we believe the better argument is that they should get a warrant, but the law is far from clear. >> george smith of the national journal. >> i wondered if you could explain what kind of information law enforcement are gathering when they ask or seek for this location data. >> shirt. law enforcement is able to get all sorts of information from tracking a cell phone. i think it would help to start by talking about how cell phone tracking work spirit that you

have a smart phone, it maybe there is a gps chip embedded in your phone, so it could be tracked with a great deal of precision, but it does not matter if you have a smartphone for a dumb one. those things can be accessed regardless. the reason is because in order to work, cell phones have to communicate with a network. they communicate specifically with cell phone towers. you have probably seen them. that transmits the signal. by knowing what tower a person's bonus communicating with, you get a pretty good picture of where they are. these technologies enable law enforcement agencies to track individuals in real time, so as you are walking around the city or wherever you happen to live, but they also enable law enforcement agencies to track people where they have been in the past. most of the cell phone companies in the united states have records about where you have been for at least a year, and law enforcement agencies can serve subpoenas or other forms

of court process on the companies and gain access to those records. in some cases, law enforcement agencies are tracking people using these sell tower records. other times, they are engaging in gps tracking. some funds from attracting one individual for a relatively short time or sometimes getting all the cell phone location records of everyone at a particular location, so there is willie -- really a wide range of practices. >> i and many of these cases where police organizations are taking advantage of new technology, their argument has often been that they are similar to, for example, following somebody physically or taking a picture of them with a camera, which in most cases do not require any kind of warrant or court sanction. how do these forms are tracking for this kind of information gathering differ from what law enforcement has been doing for years? >> it differs substantially because tracking one person,

say, by following them around is actually really resource- intensive. you need a lot of people in order to do that. being able to attract people through their cell phones erases the practical limits on the ability of law enforcement to track people, which raises the possibility that tracking will become much more common. this distinction, both with the ease of tracking, and also that prolongs the nature of tracking, is one that is recognized. just earlier this year, the supreme court decided a case called the united states versus jones in which it held that when the police attack -- attach a gps device to a car and obtain the permission from the device, that is a search under the fourth amendment, and the law enforcement agencies have to meet some sort of constitutional standard in order to attract people.

i think that because cell phone tracking is often directly analogous to gps tracking of a car that the best argument is that it also triggers a fourth amendment protection against unreasonable searches and seizures. >> you mentioned in the study that the aclu released that you also note the role that carriers play in gathering this information and providing it to law enforcement. can you explain more what the role of carriers is in gathering and providing this information? that absolutely. today, most americans have a cell phone, and all of those cell phone companies store records on where americans have been in the past and in addition have the capacity to track people in real time. the agencies are that most law enforcement agencies go to in order to

engage in tracking. they have these huge departments now where they just process court orders that they receive to engage in cellphone tracking, so it really ended up being a massive operation. for them responding to a law- enforcement request for responding to information. in the case the carriers are building these online services so law enforcement can simply log in and get the inflation that we. even though this has been gone to going on for a number of years, i do not think customers have done enough to help customers understand the way in which users use their cell phones makes them more vulnerable to tracking. you cannot go to their website, for example, and learn how long your phone company keeps records of where you have been in the past. i think that is wrong.

i think cell phone companies zero customers a picture of how customers are accessing their data. i hope that the rising tide of public concern about this issue encourages them to take action. >> you mentioned others. are cell phones being tracked by other groups rather than just law enforcement? >> i don't actually know the answer to that question. law enforcement has been our primary focus. there is one thing in the dimension earlier, that if you do not mind i might bring up now, which is that the picture is actually not all bleak. some law-enforcement agencies -- well, most law enforcement agencies, i should say, do track cell phones without getting a warrant based on probable cause. there are some agencies that do get a warrant, and i think it is heartening because it shows that at least in the view of some

agencies, it is possible to pursue the totally legitimate security needs that law enforcement agencies do have while protecting the privacy of americans, and we hope more agencies will adopt policies like that. >> what are some of the examples you have found in your study? >> lexington, kentucky, is an example of one city that gets a wide to engage in cell phone tracking. wichita is another. other cities have much more expansive uses of tracking. for instance, there is a town in north carolina that got a court order to attract not just the location of one cell phone but of all of the cell phones that had called that cell phone. in the case, they did get court approval, although i do not think the court approval was

appropriate because -- but what that means is if the person who was the target of an investigation called a pizza delivery company, law enforcement ended up tracking that phone or the guy was the mother's phone in addition to the subject of the investigation. the other example that came up frequently in the examples were generated through the support that we have -- through this report that we had not known about previously is the practice of power dams, identifying all cell phones that made contact with a particular cell phone tower. depending on what law enforcement agencies feel like paying the cell phone carrier for. that means that a lot of innocent people are getting their location information handed over to the government because many, many, many people will use a cell phones tower over the course of an hour. >> joining us by phone is a

professor of criminal justice at the john jay college of criminal justice. you have been listening to this conversation. what are your initial thoughts? >> first of all, what she describes is completely accurate. from the law enforcement perspective, i think that a good deal of the capability she described in some ways can be very helpful. my immediate reaction, however, is that the focus on limiting just law enforcement, i think, would be misplaced theory the notion that you could sell that information did that the carriers can sell that information to law enforcement agencies -- they can sell it to private interests as well. i think right now, the usage of that data is pretty unclear. who can get it, who can use it, and so forth. there are commercially available apps now that you can get on your iphone that will enable you to track not just your phone but other people's phones as well.

>> do you see where the aclu is coming from here when it speaks about the danger of the privacy? >> certainly. as i said, my greater concern would be what i would not want to see is a situation where the police are the only ones who cannot have access to the data, that it is commercially available. obviously, then the police would be able to have it as well, but i think it is a bigger issue than just what your local police department is doing. i think their usage of the data may be the least threatening of the possibilities. >> josh smith of "the national journal" also joins us." >> you mentioned that a lot of this technology can have a lot of -- law enforcement can use this for many good things, that is what they are taking a vintage of it. because they feel like it advances their investigation. how much of the rise in the use of this kind of information or technology is due to just the fact that there are more cell

phones and more of this kind of technology out there versus laws potentially post-9/11 that may have encouraged or open up this opportunity? >> i think it is a combination of the phone's being there and the technology to be able to take advantage of them. something like 50% of loans now are smartphones, which are particularly easy to track -- something like 50% of phones. as your guest pointed out, dumb phones can be tracked, not as well, but they can be. i think it was the son of sam that was found because they pored through the records and found a parking ticket, which identified somebody who was in the neighborhood, and eventually, they were able to clear the case because of that. enables thempe police to do some sort of -- the same sort of thing. you have a crime but not a suspect. obviously, there are privacy concerns, but from an efficiency standpoint of an investigation,

that is particularly useful investigation. >> do you think that there is common ground that can be found between protecting constitutional rights and allowing law-enforcement to take advantage of the latest technology? >> absolutely. >> a d should be easy for people is to get a court order if they are able to demonstrate a need for the information -- it should be easy. and control the conditions to be able to use the information. my greater concern is that the laws are so far behind technology right now that private business and a variety of other people to some extent today and in the future i would imagine would readily be able to get their hands on the and permission. i suspect carriers will make in

the future more money selling information about where you are than they get from your phones. >> recently in san francisco, some cell phone towers were shut down from the police in anticipation of a demonstration. what is your view on it? >> i think that is a real problematic ability for the police to be able to exert the sort of influence. it would be a very rare condition -- and again, i think it would require a court order or should require a court order to be able to do something that extreme. >> but that was not the case, was it? there was no court order. >> do you foresee that type of behavior or action being taken by police departments all over the country? >> we talk about a rare case.

this was simply a demonstration that they were not in support of. >> no, i don't. first, i cannot imagine very many police requesting that sort of thing. i would imagine that the push back is that becomes better known -- to push back on the would be pretty extreme. it is something i cannot imagine the police requesting very often. that said, now is the time for us to be thinking about the rules -- what should be allowed and under what circumstances. >> finally from me, would you like to see federal regulations more clear in this area? there's a lot of state and local laws working right now, but what is your view? >> >> there's a lot of ability

to block cell phones signals. there are relatively old regulations. technology has advanced beyond what the public -- with the public policy debate has been. i suspect a both a combination of regulations and probably court decisions, which, as we have seen and she just mentioned, the courts have already begun down this road. problem is, of course, those sorts of policies developed very slowly and in today's climate, i suspect we would have a great deal of difficulty getting a lot of agreements, particularly legislative agreements, on what the authority should be. >> a final question from josh smith. >> going on with that thought, what do you see as some of the challenges towards getting more of a standard framework for everybody that seems like it would provide more clarity to law enforcement as well as to individuals who are worried about their privacy? >> what do i see as the bigger problem? >> right, what is standing in the way? >> there's a lot of folks who

can benefit from the information. it is not unlike cloud computing and other forms. i think we are due for a complete rethinking of what constitutes privacy and what levels of privacy we are prepared to give up in exchange or the conveniences that come with the location services and so forth. the police are obviously one group that uses it, but they are by no means the only and probably in the future will be one of the lesser users of that information. >> dennis kenney has more than 35 years of experience in criminal justice, including serving as a florida police officer. he is a past editor of "the american journal of police" and current editor of "police quarterly." thank you for being on the show. what did you hear from our

conversation? >> based on that conversation, i think there actually is common ground between people are concerned about civil liberties and law enforcement agents. the aclu, for example, is not opposed to cell phone tracking in any categorical since. we think that there are circumstances in which it is a perfectly appropriate and indeed valuable tool. the sticking point is what standard the government has to meet in order to engage in cell phone tracking. our strong belief is that only by having to go to a mutual magistrate to have your request to engage in self on tracking review by someone who can look at it objectively and being held to the probable cause standard -- only through those equirements will americans' privacy interests be met. the point is to make sure that innocent american privacy rights are not violated in the course

of law enforcement investigations. i was is going to add, you know, i do think there is a role for congress to play here. we have not had a meaningful update of our electronic privacy laws since the 1980's, which is a long time ago, especially when you think about the type of technological changes that have taken place. some members of congress have introduced legislation that i think at least goes some of the way toward resolving some of these questions to bring clarity both for americans who are concerned about their civil liberties but also for law enforcement agencies and courts who are struggling to interpret vague and confusing and outdated laws. >> he also mentioned an app you can get for your phone or ipad that would allow you to track other people's cell phones. what are your thoughts? >> i think the private uses of

this data are extremely complicated and poorly understood. there are an increasing number of applications that people can subscribe to on their smartphones that will both allow companies to track you and also allow you to track other people. in some senses, i am less concerned about private tracking because only the government has the power to lock people up and throw out the key because it has this unique power in society. so i think that makes government surveillance often a greater threat than private sources of surveillance. but all of this is uncharted territory. i think we're just beginning to think through the ramifications of what it means to have where you are available to others at all times, and the technology is still evolving. >> earlier in the program, you mentioned some national security

agencies at the national agency looking into or using gps tracking like this. when the aclu launched this effort and survey last year, it came right after a controversy over whether the nsa, for example, and other organizations believed that they were authorized under the patriot act to use gps information to track americans. i was wondering what have you found as far as the national level -- the use of law enforcement and other government tracking? >> the truth is we found very little concrete information about what is going on. it is difficult to obtain any facts about what our national security establishment is doing in terms of surveillance in general, so we are less speculative on what we know about currently available technology to guess what the law

enforcement agencies may be doing. one example that the cato institute has raised repeatedly is to what degree the national security establishment may be tracking cell phones in a large scale manner. for example, if an individual disposes of their bone, you may not be able to track that phone for a prolonged period of time, but as they move through their entire pattern of their lives, you may be able to find another phone engaging in the same pattern and extrapolate that that is the same person who has changed phones. the situation is very murky, and we are less extrapolating about exactly what has happened with unfortunately too little insight into what -- into how that is affecting the privacy of ordinary americans. >> you mentioned legislation, and the aclu has come out in

support of the gps act, which has been proposed in both the house and senate. how would this help clear up the murkiness you see in this situation? >> the gps at what address location tracking and hold that the government needs a wide in order to track locations. it is not the only case of legislation that has been introduced that would bring some clarity to the situation. in addition, senator leahy has sponsored reforms to the electronic communications privacy act -- the old statute we have been talking about that has not been updated for some time. it would require a warrant for real-time tracking, although we do not think it goes far enough because it would allow law- enforcement to access historical information without probable cause. i would love to see some of that legislation passed. even law enforcement has an interest in their being clarity to the law, but it is difficult

these days for congress to revoke that kind of attention to the legislation. >> we asked about the san francisco cell phones power shutdown case. is that something that the aclu is looking into? -- the san francisco cell phones tower shut down case. >> it is something we're looking into. we were surprised to hear that in a city as progressive as seven cisco, that law enforcement agencies there were shut down cell phone access. it almost surprised me almost on a public relations front because it happened during the era of spring when the repressive regimes in the middle east are getting slammed left and right in the media for doing exactly that kind of shutting down communications networks in order to stymie democratic protests. we have not seen a repeat of that. the public reaction was so

vehemently opposed to this that i'm hopeful many law enforcement agencies will take heed and not go to such extreme measures. there were also legitimate public concerns about people using their cell phones for all sorts of things -- to make 911 calls for instance, and for the government to take down the whole network, i think a lot of people felt that it may do more to endanger people's safety then actually help them. >> are there any court cases that you are monitoring or that we should be aware of regarding technology and police surveillance and privacy? that yes. >> yes. dealing with gps tracking of cars was momentous because it dealt with the court's grappling with law enforcement dealing with technology. there is an open question about whether the rule of jones, that

the fourth amendment covers attaching a gps device to the car -- there is a question about whether that extends to cell phone tracking. i think actually whether cell phone tracking triggers fourth amendment constitutional protection is a much bigger deal because hundreds of millions of americans carry cell phones with them all the time. courts are really just beginning to grapple with that question. a federal court of appeals in texas is poised to consider the issue later this year, and i think that decision is especially worth watching because there is only one appeals court decision to date that really addresses the appropriately the standards for cell phones tracking. lower courts around the country are also dealing with cell phones tracking. there is also a remaining issue about gps tracking of cars after jones, which i think is really important. the court tells us the fourth amendment protects people to some degree against having their cars trapped by law enforcement attaching a gps device to them,

but it left open the question of whether the government needs a warrant based on probable cause to conduct those investigations or whether it is sufficient for a law enforcement agent to in his own evaluation conclude that tracking a car was a reasonable law enforcement step. i think the question is hugely significant because i think it is far more protective of privacy rights for law- enforcement agencies to have to go to a judge and justify surveillance then to make that assertion on their own. courts around the country including the court of appeals in california and in chicago are going to potentially be addressing that over the coming year. >> this is an issue that "be communicators" will continue to monitor. thank you for being on our program. program.