dawn. the words i feel, maybe that means the closer the turnaround is. he talks about the presidency. those were a proper remarks. the disappointment people feel with the obama presidency is that expectations were set so high. there was the sense of turning the corner with change. we get the same old. i did not have enough time to get through the slides. there is period of indecision at the end of the 19th century. no party had full control of the government for more than two years for a 20-year period. when you look at these polls about presidents, the great ones were great during periods of unified control. often, 14 years, the party controlled everything.

they usually come from that period of divided control. were they pour presence because of the conditions -- poor presidents because of the conditions? we shall not lose track of the context. we are in a tough year. all governments have a tough time taking things away. it is good to give things away. how much? who gets it? when you have to take things away, all governments have trouble. it is happening everywhere. in europe, whether it is parliamentary. we are in a situation with entitlements, debts adn government have to take things away. we are in for tough times.

i hope that is wrong and we have a sudden burst of economic growth. i do not see it coming. we are in for tough times. >> this ends the part of this morning's program. we will have a dialogue between the speakers. thank you to all of the speakers. you were terrific. >> watch coverage of the republican and democratic conventions live on c-span. what the 2012 conventions. next, a look at the fiscal burden of the united states, followed by new york city mayor michael bloomberg and news corp.

ceo rupert murdoch. later, a look at the event on the u.s. political system. >> c-span was created in 1979, brought to you as a public service by your television provider. >> next a look at the financial burden of the united states, including pensions, social security, and medicare. this is just over 14 minutes. -- 40 minutes. >> "washington journal" continues. host: joining us from stamford, conn., david walker, former comptroller general for many years in the government accountability office and now he is the founder of the comeback america initiative.

what is this new initiative your sponsoring? guest: i found it in october 2010. it is about the facts, the truth, and the tough choices about what we need to do to put our federal, state, and local government finances in order. we are nonpartisan, non-video logical and we're focusing on solutions -- non-ideological. host: what is your burden barometer? guest: it is a new innovation we have come up with. people are familiar with the national debt clock brought out in the late 1980's. it had $2.70 trillion and now it is approaching $16 trillion. while that is a shocking number, and understates the problem. when you look at the financial statements of the u.s. government, the total liabilities and dumbfounded policies are about $70 trillion.

it is going up $10 million a minute. the federal financial sinkhole is getting deeper $10 million per minute. that is the name of the tour we will embark on. it will be nationwide fiscal responsibility bus tour from september 7th to october 9th. host: when you say unfunded liability, what exactly do you mean? guest: the government makes promises for things like civilian and government worker pensions. the government has made commitments. the government has made promises with regards to medicare part a, hospital insurance program, as well as part b and c, the outpatient position than prescription drugs.

when you add up all of the unfunded obligations that, by the way, are not in the debt number or in the balance sheet, its $70 trillion. host: that includes future social security and medicare payments for people currently in the workforce? guest: existing numbers from the official social security report, and as you recall, i watched them from 1990-1995 and it takes the difference between what revenues are expected to come in over the next 75 years, and what the average life expectancy, and how much is expected to be paid out over that same period of time and recalculate the difference and you come up with how much money would have to have today investing at treasury rates to be able to live on that promise. that is more the number comes from. host: who were some of the known figures that will be joining you on your tour or who are

supportive of your efforts. host: you'll find out about the tour and about the many bit different people who have endorsed it. for example, two former heads of the democratic party, the republican party, the two living former chairman of the federal reserve. a number of ceo's, a number of former senators and members of congress. we went to former individuals, not sitting members. it will vary by city who joins us. former gov. lendl from pennsylvania is set to join us in addition to former senator grahm, ross perot, a senior, who ran for president 20 years ago. we have different people in different locations. former senator judd gregg. he will not be in new hampshire, but he is a supporter. host: reduce stand on the

simpson-bowles budget? guest: simpson-bowles has a lot more write about it down wrong. i would agree with about 85% of it. it's as we have a serious problem and need to solve sooner rather than later and we need to differentiate between our structural challenges and our long-term challenges. we need to renegotiate contracts and reduced defense and other spending. we need to recapture control of the budget. we need to engage in a comprehensive tax reform and we need to do these things sooner rather than later. there are lot of good things about it. i do not think there is any one plan that is the right plan. i do not endorse particular plans.

what we will be doing on this tour is taking good ideas from domenici-rivlin, simpson-bowles and expose the public to a range of sensible and non-partisans solutions that ought to be able to get non-partisan support. that's the key. they need to be sensible, non- partisan, but ultimately you have to get partisan support to make them a reality. host: do you agree with paul ryan in his approach to reforming medicare? guest: there is a lot of spending and mudslinging going on in medicare and it's embarrassing for both sides. they're not focusing on substance and solutions. let me give you some facts. they both understand we have to significantly reduce projected spending in medicare because if we do not it will bankrupt the country.

they both understand that we have over promised with regards to medicare. if you look over time, the amount of cost savings they're predicting to achieve is roughly the same over time. there are fundamental differences as to how they want to go about getting these changes. he would rather have a government controlled more of the policy with regards to positions, product, and services. governor romney would rather have more choice and competition and more private-sector involvement. i think it's important we get beyond the rhetoric and the mudslinging. we understand where they'd agree and the key areas of disagreement and why so that the american people can make a conscious choice about which way they think is better. guest: -- host: in your restoring fiscal sanity report said it was largely an expansion rather than a comprehensive health-care reform bill. there are some positive costs related provisions and it did not do nearly enough to address the drivers of health-care costs that have served to

threaten our fiscal future. you also had this chart in your report showing the average per year cost of health care for different groups. the united states is in red here. uk, sweden, germany, etc. guest: the truth is that the affordable care act was part of the expansion bill. it did something to try to control costs, but not nearly enough. there's no way we're going to be able to deliver all the promises they have made. the one thing that could bankrupt the government is out of control health-care costs. we have to be honest with the american people. yes, we need some level of the universal health care costs.

based on broad based societal needs, things like preventative, wellness, and catastrophic protection. we also need to recognize the government will also always do more for the poor, the disabled, and the veterans. your government wants to promise a lot to everybody and create a system that ultimately is going to fall down. we were told the affordable care act was going to save money, but according to the chief actuary of medicare, it will cost $12 trillion more than they claim. quite frankly, i trust the professionals more than i trust the politicians. we need to recognize that the one area we need to make the most dramatic changes in is health care. that is the biggest weakness of simpson-bowles. the specific proposals it has about how to achieve the cuts are really not going to accomplish that objective.

host: we have had these bipartisan budget agreement is over and over again. why is this one important? why this year? guest: united states financial condition is much worse than the politicians claim. if you use honest and compare by accounting techniques and you compare total government debt, federal, state and local to other major industrialized nations, there are only two countries in worse shape than we are, japan and greece. quite frankly, we do not want to follow either one of them. we are a temporary safe harbor because of the uncertainties in new york and because we're the largest economy on earth, because we issue debt in our own currency.

therefore, we can do things that others cannot do. we have more time than others have. we look at the facts, the federal reserve is purchasing two thirds or more of our new debt. they need to put their money some place. interest rates are at an all- time low. we're adding that at record rates. we have huge interest rate risks. we must -- and i underline this -- doing grand bargain in 2013. in order to do that, the race has to be about the economy, jobs, and fiscal responsibility. the american people can make a choice about who is best that whoever wins will be able to claim they have a mandate. that's what we need. host: it is now your turn to talk with david walker.

caller: hello, c-span. thank you for accepting my call. i appreciate you very much. host: we're listening. caller: in your estimation, where did the stimulus package go? guest: first, i think we did need some kind of stimulus and the size of the stimulus was adequate. the's the problem with stimulus. it was over-sold, under delivered, was not properly designed, was not correctly implemented. as a result, it did not have near the impact we were told was going to which tainted the water in being able to do more actions in the future. let me give you one example. in europe, they do a lot more planning with things like critical infrastructures so that when they want to end up spending a lot more money, they

have projects to help grow the economy, and hence the environmental situation, and in many cases they have already been preapproved with requirements. we do not do that. the united states is very porat planning at the national level and does no planning between the vermeil of government. therefore, when they decide they want to do spending they does push money out the door. we are just repaving roads. that does not do much to help improve economic growth. we have to recognize that, while the stimulus was needed because was poorly designed, it is not properly implemented. it did not have near the impact it could or should have. host: off of twitter.

guest: there is no question that we are waiting on congress, we might as well move. they are a dysfunctional body. we currently have their republic that is not representative of the or responsive to the public. we need political reforms in addition to operational reforms. we need to change the house of representatives to maximize competitive districts rather than minimize them to entrench incumbents. we need to get rid of democratic and republican primaries and go to open primaries were the top two vote-getters runoff for the general election. thirdly, we need to deal with campaign finance. we have the worst of all worlds. people can give unlimited amount of money with limited to no transparency and no candidate accountability. fourthly, we need to have term limits.

our founders never intended for us to have career politicians. people who, may or may not have had a real job, they want to keep it for life. it's not conducive to telling the truth, making tough choices and to have a crisis. it's also not conducive to innovation. we need for all those things to be pursued. host: in your restoring fiscal sanity report, this is the u.s. defense spending, $698 billion. here are the next 14 nations combined, $646 billion. tweeting in -- guest: i do not think it needs to be slashed by 75%. there is no question that the pentagon is a bloated bureaucracy. we are doing a lot of things based on the past rather than

current and future threats. we have way too many bases. our contract and practices need to be revised. compensation and benefits need to be rationalized. there are a number of things that need to happen. we can significantly reduce rid -- defense spending without compromising national security and that needs to be one of the elements to putting our finances in order. let me know to going to the one chart you mentioned before about us spending double per person in health care, we also do that in k-12 education and in both areas readable lower than average results. spending dull person -- spending double per person, the answer is not to throw more money at it. we need to look at the mechanisms to transform it. the base system is getting that kind of results, it's called insanity. host:desoto, texas. you are on.

caller: good morning. i just want to make a comment. texas got the largest in the stimulus. i have three grandchildren in college. their dad lost his job. he was a teacher. now he drives trucks. they're still on his insurance because they are under 26. my son has a construction company. he cannot hire illegals. the jobs are there. growing up, i saw my mom do whatever she had to do. cooking in restaurants, maid work, whatever. she did it. paine finance. -- campaign finance.

have a niece in afghanistan. her mother works there as a contract worker. nobody talks about the amount of people from america that are in afghanistan. she was drafted from shreveport to afghanistan. that's where she's working. that's my comment. if people quit whining, there are jobs out there. create some jobs. the stimulus in texas, $25 million. host: david walker, anything you would like to respond to? guest: we do need to recognize the have two challenges. we need to improve economic growth in the short term, try to get unemployment and underemployment down, but at the

same time if we do not start dealing with the large structural deficits that lay ahead, we will never have these sustained over time. there are opportunities out there and many americans do not want to pursue those certain opportunities. we have a cultural challenge. we have moved from an opportunity society to an entitlement society. personal responsibility and accountability was core. now, we have too many people trying to blame other people for their problems. look. this is a great country. we need to have more things to try to create more opportunity for people. we need to have a solvent, sustainable, secure social safety net. but that we are on now is unsustainable and we better change it sooner rather than later if we want this to work. host: independent in idaho

falls, idaho, you are on with david walker talking about comeback america initiative. caller: thank you. i'm like to talk about one of the major entitlement programs which comes directly out of the general fund, ssi. i'm on it right now and i'm looking forward to going back to work within the next year or two. there are perverse incentives in the program where you can try to go back to work and you end up poorer than if you just stay on ssi. that needs to be fixed. host: david walker. guest: i agree. we need to take a hard look at a number of our federal programs. we have perverse incentives. it is not just with regards to ssi. there are certain aspects with regards to medicare and medicaid where there are services like in home, that are more conducive to their lifestyle and more cost- effective for the federal government, but the program will not allow you to pursue those for various reasons.

let me bring this up a level. the united states government does not have three things that it takes in order to ensure success. we have been in business for 223 years as a republic. one, we have no plan. two, we have no budget. three, we do not have performance metrics to understand what is working, what's not working, where are we getting better, how we compare to our comparable groups? at the person just mentioned, we all stop and look at our programs to make sure we have the proper incentives, adequate transparency, and proper accountability mechanisms. if you have those three things, you have successfully unsustainable programs. if you don't, it's only a matter

of time for people fail. host: newport, n.c., richard on the republican line. you are on c-span. caller: thank you. you keep mentioning social security as an entitlement. yes, we are entitled to that. we paid in to that. the entitlements are medicare, medicaid, welfare, food stamps. you keep dumping money and food stands. -- into food stamps. you put money into breakfast for kids, but they are too lazy to get up and fix their kids breakfast or you just give them free lunches. that's more money and you do not take off their food stamp card. i go to the store and buy see people buying chips and soda with the food stamp cards.

this is what they need to get in on. never mind social security. leave that along. we paid into it. the government robbed us of blind and they are not paying. social security and not an entitlement. host: david walker, just follow up on that caller, there are a few tweaks i want to include in your response. -- a few tweets. guest: i do not even like to use the word "entitlements." we are opportunity society, not an entitlement society. people think they are entitled to things merely because they are a citizen or because they are a legal resident. in some cases, even illegal residents think they are

entitled to certain things. social security and medicare are social insurance programs. it is adding to deficits. to ill increasingly as to \ dd deficit. medicaid is in increasing worse shape. the number is $70 trillion. 37 is medicare. social security and medicare are different from welfare programs. welfare programs are not universal. there are some perverse incentives in our programs that we have to address that

discourage people from working or done certain things that they should otherwise do. one of the things we should to for social security reform is increase the taxable wage cap. is a hundred $10,000. increases to about $150,000. if you eliminated, as it has been done for medicare, you would be raising taxes 12.4% above that. we need additional revenues. we do not need all of those revenues for social security. we are spending about 40 cents -- dollars $1.40 for every dollar we take in. we have a lot of other problems, the biggest one being health care. host: new york, fred.

and appended. -- independent. caller: what do we do? we need a brand new congress. that is my opinion. we have to address something important to address. the waste and abuse in all of these government agencies. these people are sitting on their hands. medicare has lost so much money on fraud over the years, the committed amount of money that they have lost is probably more of a reason is going into this bankruptcy. people are collecting from everywhere. there is no abuse control. what do we do? a bandage approach? we need a new set of leaders in this country.

there are unbelievable excuses with ivy league educations and all of the experts and advice. our america is on its knees. guest: you have to recognize congress is a committee. they are in charge. you do not have a chief executive officer. there is only one, the president of united states. the president has an obligation to lead. the biggest deficit we have in this country has been this way for a while.

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>> they are legitimate questions. but recognize the reality. the world is getting smaller. we are not want to get back to protectionism. we have to recognize we cannot compete on wages. if we try to compete on wages,

will be undercut by china, indonesia, whatever country it may be. we have to be on innovation -- we have to compete on innovation, value added, the things that america has a comparative -- competitive advantage. we have to reform our tax systems. we have to treat the disease, not the sentence. -- does sometimes. caller: i am concerned about your agenda, because it is my understanding that social security and medicare -- the trust funds for years since i started to work, and i am 71, my

payroll taxes have gone into the trust fund. my payroll taxes have gone into the trust fund just like everybody else's. what has happened, i believe i am right, beginning with the reagan years and subsequent presidents and congresses after that, they borrowed our money and used it for other programs. they secure the debt with treasury bills. you are advocating defaulting on the debt? is that what you are saying? guest: absolutely not. i was a trustee of social security-medicare. let me help you understand. since the beginning of the social security programs enacted into law in 1935, effective in 1940, since the beginning, to

the extent their revenues in excess of expenditures, by law, these have to be invested in u.s. government bonds or other debt securities backed by the full faith and credit of the united states government. it has nothing to do with ronald reagan or any particular person. it has been that way since fdr. what happens is for a number of years there were surpluses. those were invested in u.s. government debt. the money was spent on something else. that debt is backed by the united states government. it is guaranteed on principal and interest. it is guaranteed by the 14th amendment to the constitution. it is several trillion dollars. we will not back away from that. there are a lot of the promises made that are not backed by those bonds. we have gone from having 16 people working for every person retired in 1950 to now about 3.1 working for every person retired. we're going down to have two persons working for every person retired. because people are living longer, the numbers do not work. we need to reform it to make it more sustainable. if you are 55 or over, little to no changes. the younger you ar the more you will be affected. this is one of the areas i will be talking about on the tour.

i have gone to 49 states doing events. in the last year in talking about potential reforms, they get 95% plus support. host: a few more minutes left with our guest. time for a few more calls. shayna from new york. caller: it is lovely to be on. i have admired your message for years. i was hoping i could entice you and other groups to look at what our universities are doing to our agriculture policies along with the u.s. government and state agencies of supporting

farmers who want to take farmer welfare and destroying the fiscal responsibility. it is very disturbing. it is not looked at and putting a huge burden because the government and universities are pushing farmers with illegal alien help as opposed to individual farmers. please look at it. guest: i will try to find out more. i am not an expert. i will look further into it. thank you for the suggestion. host: the last call for david walker comes from keith, a republican in florida. caller: think you for your service. i have seen you on msnbc, cnn, everywhere. i talk to informed people. they are still not getting the message.

in 2000, we were $56 trillion ahead. president bush gave a tax cut. supposedly only the rich got that. how did we go from 56 trillion dollars over and in 10 years $56 trillion under when the tax cuts were only $4 trillion in that 10-year period? guest: at the end of 2000, we had $5.60 trillion in debt. the unfunded liabilities were $20.40 trillion. today we have about $16 trillion in debt. the total liability in unfunded promises are about $70 trillion. things have spun out of control since 2000. both parties have controlled congress during that time. both parties have controlled the

white house. things have particularly spun out of control since 2003. in 2003, three things happened. the second round of tax cuts could not afford returned to deficits. we invaded a sovereign nation without declaring war or paying for it. congress passed and the president signed an extension of medicare, added $8 trillion when medicare was already underfunded. you cannot spend more money than you make up the rate we are, charge it to the credit card, and not expect to have a day of reckoning. it is not too late to turn things around, but we need to make major progress in 2013. to do that, the president has to exert extraordinary leadership. we need to put pressure on the house and senate to work with the president to make a

comprehensive reform plan that will keep us from having the debt crisis over time so our future can be better than our past. there needs to be tough choices that might cause some short-term pain but much greater long-term gain. host: once again, why do you think your approach will be successful? why are you taking this on? this has been tried before. guest: this has not been tried before. there has never been a nationwide bus tour. we're going to swing states because the candidates and press will have to spend time there. they will decide the

presidential election. you can have a greater impact there. my experience is the people can handle the truth. they are just not told the truth very often. they are willing to accept tough choices as long as it is part of a comprehensive plan they deem to be fair. i am trying to help fill the void. we need more truth, leadership, solutions. we need our next president, whoever it is, to lead. >> sabrina shave fraudulent us to talk about women voters. the federal government began accepting applicants deferring deportation of illegal immigrants. we will talk about the loss of the 2009 auto bailout.

life at 7:00 a.m. eastern on c- span. tomorrow, life campaign events from around the country. paul ryan campaigning in tampa, florida. 10:00 a.m. eastern for live coverage. president obama it tends a campaign rally in >> up michael bloomberg and rupert murdoch to give advice on the immigration policy. you will hear from the boston mayor. this is about an hour. [applause] >> the council is having a discussion on one of the most

vexing issues of public policy facing our nation -- how to develop and implement fair, sensible, enforceable immigration policy. it is a topic that often is addressed with more heat than light. a partnership for a new american economy is working to change that tendency and to promote serious, intelligent, rational, and respectful engagement on that complex issue. we are especially honored to have with us two prominent leaders of the partnership for the new american economy. mayor michael bloomberg and news corp. chairman michael -- rupert murdoch. they are joining us tonight as the partnership releases a new report on the increasingly important role of immigrants in starting new businesses of all

sizes and in all sectors, the copies of which will be made available hopefully as you leave here this evening. mayor bloomberg, after an enormously successful business career, has gone on to an enormously successful career in public service. we new englanders claim him as one of our own. the gift to the big apple. and as one of mr. murdoch's headline writers might say, "local boy makes good." [laughter] mr. murdoch, as you all know, took the newspaper business from down under and over the competition -- up and over the competition to make news corp. a truly global business. for him, the headline might be,

"media mogul routes rivals." his international perspective on the intersection of business and immigration will be fascinating to hear. to moderate the discussion, we are pleased to welcome jerry seib, the assistant manager and editor and executive washington editor of the "wall street journal," also writes a column a couple of times a week. terrific, terrific, terrific read. people often say to me, "how do you know what you know? " i say that i read gerry. that is the reason. i am pleased to introduce another talented and accomplished chief executive, who is also a partnership for the new american economy. our good friend, well known to all, the mayor of this great

city. [applause] >> this is the major city. he is asking to sit. -- this is the mayor's city. >> thank you. jim's earlier quotes about having this forum in the middle of summer. we in the public sector work by things -- five days a week. you guys in the private sector can do whatever you want to do and nobody ever watches you. someday when i get in the private sector, i will not have

to worry about all that nonsense. it is a pleasure to be here this afternoon. thanks to the new england council for hosting this evening's conversation. i am really proud to be a member of partnership for a new american economy. i want to thank my friend, mayor bloomberg, for keeping the immigration issue at the forefront. and really leading the way so our country can have an important discussion on the issue. i know tonights conversation is about immigration. but i also want to recognize mayor bloomberg for his leadership. together, we started mare's against illegal guns 26 years ago. now we have this as part of the

coalition. we started a plan to reduce the toll of gun violence across the country. i am proud to stand with him on this fight. i thank him for his leadership almost on a daily basis. [applause] i also want to thank rupert murdoch for being here and sharing his views. thank you for being with us. it just gives us diversity of opinion. tonight, i am pleased to offer some brief remarks about a

vitally important topic to our nation's future. boston has a proud history of immigration. our city has been a gateway for immigrants since just about the start of our country. tens of thousands of immigrants came to these parts in the early 1900's, and today, boston welcomes people from many different cultures and countries. immigration has made boston a better city. generations after generations, the irish, italians, the greeks, to today's immigrants from africa, asia, and latin america. immigrants have helped to reinvent boston.

they make this old city new again and again. how are immigrants making boston better? let me tell you about three ways they are. number 1, immigrants are strengthening our economy. all you have to do is shop at one of our neighborhood businesses. visit our hospitals. attend one of our colleges. eat at one of our restaurants. see how immigrants contribute to this economy. the drive to succeed knows no one race, color, or creed. let me give you some numbers to back up those statements. 8800 immigrants owned small businesses in boston, generate almost $3.7 billion in annual sales and employ over 18,000 people. newcomers in boston also spend

just over $4 billion annually. this spending generates $1.3 billion in state, federal taxes and helps support over -- 2500 jobs in our local economy. number two, immigrants are growing our cities. for the first time since 1970, boston's population stands at over 600,000 people. for us, more people means more challenges, more ideas, and more innovation. a lot of that population growth has come from immigrants. you know what we call immigrants here? mom and dad. you know what we call people from another country looking to fulfill their dreams in our city?

brothers and sisters, aunts and uncles. we welcome them always open arms. we are here to help them along the way. number 3, immigrants are making boston and more diverse and international city. you can walk through boston's neighborhoods and your 140 different languages, celebrate countless cultures, and sample food from around the world. listen to the fact -- in 1980, close to 70% of boston was a white -- was white. today, less than half the city is white. that diversity is one of boston's great strengths, a real competitive advantage in today's global world. so, when boston's immigrants

continue a strong tradition that dates to the start of our century, they are a positive force for our city. they strengthen our economy, growing our population, and making our city more diverse. it is no wonder that some of our east coast, bonds have looked at boston to see what they can do to attract newcomers for the same positive results we have seen in the city of boston over the last several years. immigrants are making huge contributions in boston. this is what immigrants can do even more across our country. come together, get the job done at the national level. this is not a democratic issue or a republican issue. it is an american issue. we want our country to be open

and forward-looking. as this debate moves forward, let's not forget our past, the factors -- the fact is that we all are immigrants. almost all of us come from someplace else. that shared experience should guide our national conversation and its tone. we should be less concerned about where people come from and more concerned about where they can go. we as a city and a country can go together. i once again want to thank the council for giving -- the new england council for giving me this opportunity. this is one of those issues that we debate nationally, and locally, we are acting.

we welcome those immigrants to our city. part of the economy, part of the growth, part of the diversity of washington. we have to respect that. i think that discussion that happens this evening will show that respect and how important immigrants are. i just want to start the conversation. another one of those phony issues we discussed nationally. let's get down to those real issues that affect america. thanks a lot. [applause] >> i want to thank mayor menino for his kind remarks, but also, you all know he has been a great supporter of the business community here in boston. in particular, under his leadership, we have seen this innovation district that we sit in the middle of right now really come to life. we are thrilled that you are here tonight, and we are also honored by your leadership and

your presence here, tom menino. [applause] notice there are index cards on your table. if you have questions for our speakers, please write them on the card, and staff will come around to select them and give them to our moderator. with that, again, thank you for joining us here tonight. i turn the program over to joe. [applause] >> i am in great peril here tonight, and i need your help. i have agreed to moderate the discussion involving the man who signs my paycheck and the guy who started one of our principal competitors in the news business. so i have to be careful. i am counting on you to ask the hardball questions. please help me. but the money cards. -- put somethin gon tg on the c. do not hold anything back because i may have to. let's talk for a while, and then we will get to your questions. mayor, let me start with you.

you wrote a piece in which you said there is nearly a consensus on this subject we are talking about tonight on immigration reform that something ought to be done. if there is consensus, why does nothing ever happened? >> let me start by saying that tom menino understated his contribution to mayors against illegal guns. i helped, but he did a lot of the work. having said that, i am better looking. [laughter] integration means two different things. there is consensus on one of those things. immigration, and that is what rupert and i talked about, is the need to have people help our economy grow, put americans back to work, make sure the industries of the future are created here.

to a group of people, immigration means what i call family reunification, and that is bringing over their relatives here, and they may or may not have the skills that we need for their economy, but the family reunification people would argue that that is as important or more important. i think it is true that both sides have tried to hold the other side hostaged, but there is consensus, certainly on the economic side. there is enough pressure on both republicans and democrats in congress from the home town farmer who cannot pick his crops any more because he cannot get seasonal workers or the businesses that cannot get the engineers and doctors, lawyers that they need. the problem is that our country in congress and in washington has become so polarized, they cannot be seen working together. they may agree on something, but certainly, before the election, -- they learn what i call the dick lugar lesson. if you go to the middle and look rational, the orthodoxy of your party will throw you out,

whether it is from the right or left. i think there is a consensus, but i do not see how they come to the other, unless the next chief executive, whether it is obama in a second term or mitt romney, can pull them together, and that really is the chief executive's job. >> the report that is out today talks about the connection between immigration and economic vitality. in your mind, what is that connection? what is america missing in making that connection between immigration and economic vitality? >> maybe it is just ignorance. i have seen that paper, and one can argue very, very strongly that most immigrants add tremendously to the economy, but it is also argued about special immigrants. i think we are in a crisis in this country. for instance, of all of our

graduate students, there are only 4% within science, technology, engineering, or math in a graduate. in china, it is 31%. we have a demand just with our present economy crippling along in the next five years for 800,000 graduates. there will only be 500,000. there is a desperate need for 300,000. i think that is probably a great understatement. if we get right now qualified people, get them in, there should not be any nonsense about it. the mayor said it first. this is boring. we agree to much with each other. [laughter] but the h1b visa, they should

not have them. when they get a graduate degree in a certain subject, they should have a green card. and the argument. -- end of argument. there is a huge economic argument. we could take it step after step. for instance, an immigrant is more likely to start a small business than a non-immigrant. why is that? well, they are more ambitious. they have come here. they have left behind the place they come from, may be desperate circumstances. they want to dream the american dream. i think there is a lot more to this than economics. i think it is the nature of the country, the culture, the

history, which will always be an open country, to welcome the oppressed, to meld them in, and they have formed the character of this country, which we must not let go. we all talk about the parties. it is true there has been a flood of illegal immigrants in southern california or some of the southern states. there is sort of a nativist groups who do not want any more or want to send them all back, but it would not take much courage for the republican candidate or his deputy to ignore them and run right over them. they are not going to vote for obama, so what the hell? do it. it is just an overwhelming case. as i say, i think economically, which is an urgent case, and on a broader sense, i think ideologically, there is a great case for it as well. >> to add to the point,

education is the key. america is falling further and further behind the world. in new york city, we have made enormous progress in the school system. 65% of our minority kids graduate high school. i was in chicago this morning. 30% due in chicago. 65% in new york. yet, in new york, we are still falling behind what is needed in industry and falling behind what the rest of the world is doing. the one part of education that we own is higher education, except we are deliberately trying to kill it. we are taking the best and brightest -- they get their ph.d. or their masters, and then we send them overseas. they cannot teach here. they cannot do their research here. what do they do? they built the industry's overseas and start making the overseas universities better than us. you will not reverse that easily. there is something like 3 million unfilled jobs in this country. businesses just cannot find

qualified people to work. it is not incident just education. in alabama and places like that, a lot of the crops this year just brought it in the fields. they could not get people to pick the crops. -- a lot of the crops this year just rotted in the fields. >> if this were easy, we would not be having this conversation. you have to deal with the politics. you have to make people feel better. make my family feel better. my son is a physics student. you let in a lot of foreign physics students, are you diluting his job market? my sister lives in amarillo, texas. they are very worried about waves coming across the border. >> one, nobody has come across the border in a long time. we spend a fortune on technology. if you want to come to america illegally, do not waste your time going across the border and through the desert. it is dangerous. just lie here and overstay your

visa. we have absolutely no ability to check who you are and get you back. -- just fly here and overstay your visa. we solve our problem by having an economy crater. people do not come here to put their feet up and collect welfare. if there are no jobs, they did not come here. if they cannot find a job, they go back home because america is not a very good place to sit around and think the state will support appeared in the case of your son, somebody has got to create the business that he is going to go to work for. all of the numbers show -- and rupert pointed out -- immigrants, and i think it is because it is a self-selecting thing -- rupert is an immigrant. it cannot be easy to leave australia, come to the other side of the world literally, give up all your friends and family, everything you know, and start out from scratch. that is what people are willing to do. of course immigrants are going

to be more aggressive. of course they will be more risk takers. that is why they have come here. your son will want to go to work in a place where there are other engineering companies. that is the duty of the boston area, which has the big high- tech industries. york, where we are creating one. austin, texas, silicon valley. -- new york, where we are creating one. they want to be where there are other people doing the same thing, other companies. the way business works is you split off. people go back and forth. you copy each other. you work to -- you work together. you buy from, you sell to. unless someone starts the process, your son will not have a job. >> in silicon valley, you suddenly realize it is misnamed. it is not the silicon. it is the evidence. immigrant valley. go there for a couple of days. you'll be overwhelmed with young people with great ideas of trying to set up. some have been successful. you can name company after

company -- big companies and hundreds of little companies, of course. they all took big risks. >> i spoke to a united states senator i will let them couple weeks ago, and he was at silicon valley, and i asked what they want to talk about, and he said immigration. you are right. the question i have for you is -- i of the feeling is that -- if the feeling is that strong in the business community, why are more people not marching down to washington where i live and making something happen -- if the feeling is that strong? >> that is why we have got to organize this, try to get a movement going. to make ourselves stock. we are the politicians. >> i would argue that the one thing that seems to drive most elected officials -- not all -- tom is not one of them. i am not one of them, i hope. but most elected officials, their business is a job. they might also want to make a difference in the world, but it is a job.

it is the way they feed their families. the thing that drives them the most is a way to keep their jobs, which means getting reelected or elected in the first place and keeping the party in power because that makes it easier to continue to get reelected. if you want them to do something, you have to convince them that voting with you for your interest will enhance their ability to stay in office. and i of the other side has a bigger threat to them -- and if the other side has a bigger threat to them, they will go in the other direction. the perfect example is the nra. it is a textbook case of how you go and influence congress. you either vote with the nra or you do not. they never take any prisoners. they are explicit, and they do not consider any of your other views. our problem is as rational people we will allow an elected official -- we might not like this one thing, but they are ok on the other things.

the gamble is they will vote with the nra and hope we still like their positions on lots of other stuff. whereas if they do not vote with the nra, there is no question the nra will go after them. you have to make the immigration lobby, if you will, say to the officials, "you either do something to help this country and get the people in your we need, or we will vote for your opponent and raise money for your opponent." unless you are willing to do that, you are just sitting in the wind. >> i want to spend the next few minutes just beating up on the teachers' union. [laughter] the mayor has had a tremendous 10 years, 11 years, a lot of it pretty tense when it comes to the teachers' union, and he has made a lot of progress.

you can bet that his successor will undo all that. it is a tremendous problem. for instance, they have managed to get themselves into position, and i think this is probably true across america, where all the teachers bargain for is a pension and how early they can retire, how soon they can get tenure, etc. so when the education authority comes to look at the books, they've got very little money for hiring new teachers. what do they get? they get the lowest -- they draw from the lowest 20% of university graduates. other countries make it legal that you have got to draw from the top 30%. it is all sort of self- perpetuating, and there has got

to be a showdown sooner or later on this matter because they then charge their members q deduce, and they throw money at every politician -- they charge their members huge dues and they throw money at every politician. >> will your reforms on rabble? >> i hope not. what we have to do is instill in the public the notion that they can have schools that include all the students. i think about it, we guiliani -- rudy giuliani was my predecessor. his job was convincing the public that you could have low crime and good race relations and that any mayor that came after him would not be able to allow a crime to go back up. since then, we have brought crime back down another 35%.

we will have the lowest number of murders in the city's history. life expectancy, partly because of low murders in new york city, is now three years greater than the average in america. but i could not let crime go up. i would just get beaten in the press every single day if i did. that is not the reason i brought crime down. that is not the reason ray kelly is i think the best police commissioner the city has ever had. but the public would not tolerate it. what we have got to do in education is try to create an expectation of the public they will not tolerate the reform's going away -- reforms going away. the teachers union will certainly put a lot of pressure on the candidates in the democratic primary. the democratic primary is everything. they will put an awful lot of pressure on offering their

support in return for -- and they might not want to roll back everything. that is not fair. but a lot of the stuff they want to roll back. particularly evaluations that are specific. if you take a look in the country, i think one of the real difference is -- differences is how much you want to measure people based on. some is touchy-feely, some israel members. rupert and i certainly would agree that you want to measure outcomes, and in the private sector, if you do not do a good job, you will lose your job. if your industry is in trouble, and because of the economy, you are competitive, so what? you will still lose your job. in the government, it does not work that way. the teachers union will set family structure does not today provide the background that it used to before and therefore, they cannot do a good job. that is not an excuse in the private sector. >> nor is it true, as the charter schools have shown.

i know from some charter schools, when they draw by lottery tickets, 60% of them from single mothers, and they turn out and get incredible grades. they do a superb job. they go on to college, everything. it is a tragedy that there's so few of them. >> there will be pressured to change the democratic party in new york city. 20 years of built up pressure for patronage is a pretty powerful thing. we will see. i think there are four main candidates that are running, and i think they are all intelligent and smart. they will have to make their case to the public and to the teachers' union and balance that. it is not easy for them. i will be interested in seeing what they do. all i know is what i have got

to do is try to make the public understand if they demand a great government, they can have it, but it is up to the public in the end to hold government's the to the fire -- feet to the fire. if you do not do that, government will go to work for the people that had the most to do with their getting reelected. there are certainly business groups that do the same thing. >> you started down this path of immigration a minute ago. what would you like mitt romney to do on immigration or to say on immigration, and what would you like barack obama to do or say on immigration? that either one, i would love them to say that they are going to change the whole system. at least at the beginning. get rid of this h1b thing. as for the so-called illegal mexicans, give them all -- that behave according to the law or that are okay, provided they learn english, give them a path to citizenship.

they will pay taxes. they are hardworking people. they are everything. why mitt romney does not do it i have no idea. because they are natural republicans. [laughter] they are catholics. they are family people. >> they seem to be all in the democratic party, but they tend to be much more conservative on social values -- gay rights, public schools, the sort of thing. the republicans walking away from the latino community is about as dumb strategy as any political party has ever adopted. but you know why he does not do it -- the screams in his own party would drown him out. what are they going to do? that led to bad. he is going to go to the convention. are they going to go and vote for obama?

-- >> too bad. he is going to go to the convention. are they going to vote for obama? >> can you see a republican convention where they do not nominate mitt romney at this point? in terms of the general election, the people opposed are not going to vote for obama anyway. the same thing is true i would argue for barack obama. both guys have 45% of the vote. they do. you are really arguing about 10% or 15% in the middle, maybe less. those people are not ideologues. they have real interests, and they listen. that is where all the attention should be. i think that a lot of people, all the pac's spending misfortune -- i think all these people are wasting their money. there are so many ads in swing states, everybody tunes out and you cannot pay attention. it is slogan after slogan, and eventually, your mind bills to the whole thing.

>> -- your mind dulls to the whole thing. >> on this hispanic think, i agree with you. they are very sensitive people appeared on saturday, there was not a hispanic in this country who was not crying with joy about the winning the gold medal in brazil. did any candidate had enough sense to refer to it? no. but it is not a difficult thing to do. it takes maybe a little courage, a little bit of overriding a few advisers, but it can be done. >> in this new report, which is fascinating reading, the downside -- the good news is that business started by immigrants are going up. but aside -- i wanted to ask about -- ask both of you -- is

that businesses started by native americans are going down. what is the problem? why are there not more entrepreneurs among native-born americans? >> it has been too easy to go to college. and spent three years being subsidized to do bloody media studies or some rubbish. [laughter] truly, it is easier to go to college and take some soft course. that is one thing. you know, we have 23 million people in this country today who are out of work, who do not work. a lot of them have given up looking for work.

are they getting so much benefits and everything? i do not know. but i think you have a big problem. it is getting very political. i think you have so much doubt about what is going to happen to taxes or what is going to happen to regulation and everything else that people are frightened to start a business. there is uncertainty about the future, which gives people confidence to do something. >> it is two things. the hunger of immigrants. it shows every time. every ethnic group, the newer ones here are hungrier. that is a self-selection process. if you come here, you want to do it. those that are already here, some do, some do not. the other thing is having them go out and actually be creative

and try new things -- you know, as his fascinating. this morning, i was in chicago giving a speech. the two presidential candidates are unwilling to say where they stand on immigration, on the fact that 40,000 americans are going to get killed in the next few years with illegal guns. we have this triple witching hour of sequestering and the bush-year tax cuts -- bush-era tax cuts and the deficit ceiling staring us in the face. the good news for the country is we at least have two vice- presidential candidates that seem to have some courage and say what they want to say. whether the people who have picked them to run with are happy about it, i do not know, but you cannot say that either will ryan or biden are shrinking violets. good for them. whether or not you agree with them, at least you know where they stand. >> i agree totally. wish we could reverse their positions on each ticket. >> what of the big problems we have in the country -- there

are these old industrial cities that have been hollowed out. boston, not true because you have a big stem group of peer -- up here. it has a big history. or chicago or new york, and there are other cities, but there are cities who their whole industries have just left. there's no traffic on the roads. they have too many classrooms, not too few, as we do. the question is -- what can you do about it? i was asked about it, and that picked detroit, and i do not know why i picked it as an example, but the federal government could do something and it would not cost anything. we are so worried about not having the money, but here is a solution to the problem. if you have a better one, we would love to hear it, but we could say that we will welcome people in this country, families and we will assign them to a

city, and they have to agree to not be arrested, not take federal or state money, and be there seven years, and if they survive seven years, we will make them and their families full citizens. they would go there, by these houses that are parallel, fix them up, there kids to school and tell them to value education, make a big fuss and demand the schools get better. immigrants have a very low crime rate. we certainly do not have to worry about that. they create businesses. if they had to drive to california every morning for three jobs and drive back at night, they would do it. when people vote with their feet, they come to america. it is the one currency. it costs us nothing, but it is phenomenally valuable overseas. you would get people to come here, and they would fill those cities with a vibrancy. people who are unemployed in those cities would suddenly have companies they could go to work for. they would get the jobs helping to fix up the houses. they would be in the schools, driving the buses, starting schools of their own because they see how other people can

do it. other than that, i do not know how there is any great solution. at these immigrants that will create the jobs. >> i do not know that i agree with that. that is a pretty high price to pay. but cities, and cities go, and there are great new cities being built -- cities come and cities go. detroit is a disaster area, but you go 10 miles around, and there are beautiful suburbs everywhere. it is not that bad. there is just change. it will come back. someone will bring it back. i agree with that. you will probably get, you know -- i have a theory that within three or four years, you will see huge, chinese investments in land and development in this country because they will have to put their money somewhere. >> that is a good segue to the first question from the audience.

thank you. appreciate it. it is something i wanted to touch on. what can we learn from other countries and the way they think about immigration? other countries other than the united states. what should we be learning from them? >> we are learning -- and we can if they are successful -- i think that's -- what looks less successful is singapore is not a great example. they have got a tiny island, and that a lot of money to get the very best brains there, and as a result, they have a higher gdp per person. it is terrific. but if you look at australia, new zealand -- i would not say y australia was ideal. australia was ideal. there is a huge debate about it at the moment.

it is only about illegals coming down from asia, and personally, i will let most of them in. it is interesting -- we have had floods at times from different places, and it has led to crime, and whenever crime has been left alone, the community has taken over a town or the outside of sydney, or all vietnamese would be one, all lebanese another, it is not long -- maybe it takes half a generation -- they work it out amongst themselves with their leaders are. there are power struggles and gangs, but that is normal. look what we have had in this country. you saw that film -- what was it called? "new york."

>> "gangs of new york." >> it was fantastic, the battles. now we are a much more sophisticated country, a much bigger country. and people spread out much more. they do not all, in a flood -- they do not all come in a flood. >> we give out most of our basis for family reunification. take a country like canada, most of theirs are given out for helping the economy. there are a lot of countries around the world that will pay you to come there and start a business. they have a pro-business policy. they use immigrants as a stimulus to their economy, and we do not have that mind set. >> canada loosen up in the last year or so. >> yes, you should go to vancouver. a lot of the big i.t. companies have offices in vancouver because they cannot get the engineers into the united states, but they can get into

vancouver. it is just a boat ride across the pond. >> it is a great manufacturing center for drugs to come across the border. something like $10 billion or $15 billion of bad drugs come in from british columbia to the western states. i am not suggesting what you can do about it, but it is a fact of life. >> there is a question here about something president obama did a few months ago, which was a stopgap policy, which was essentially to say that his administration would not enforce the deportation laws as they pertain to younger immigrants who were born here -- illegal immigrant parents, been to school, got in trouble with the -- have not gotten in trouble with the law, we will not deport them. is that a good idea?

>> politically, it was brilliant. romney, instead of changing his policy and outbidding him, said he did not want to look like a flip-flopper. well, what the hell is he talking about? it is the policy that matters. >> the obama administration has supported more undocumented and probably the last five administrations put together. you would not expect that from a democratic administration. -- the obama administration has deported more undocumented then probably the last five administrations. kids that were carried into the country in their parents' arms -- did they break the law? technically i suppose they had no right to come across the border. they did, but in terms of culpability, i mean, come on. these are people who want to work. they want to go to school. they want to serve in the military.

we are desperately trying to get groups like the to push them out? the president was right on this. >> i agree totally. >> the next question, i will read what is written because i think it captures the political ranks. how do you count the the rhetoric that is out there that immigrants are taking jobs and change it to immigrants create jobs? also the web up -- also, what about people's fears that immigrants might be terrorists? >> last time i looked, most of the terrorist tend to be born here, educated here. they all have mental problems and that sort of thing. it is true there are terrorists overseas. what are you going to do? close the book and not let anyone in? a terrorist is just as likely to be a terrorist as someone who comes here to work. i just do not think that is a legitimate thing to worry about in terms of creating jobs. if you have a seasonal worker, they create jobs at higher

economic levels in terms of once the crops are picked, what happens to them? at the engineering level, they create jobs below in lesser skills, so you want to work in both directions, but the terror thing -- we have to be vigilant. we have to be in charge of our own borders. we have to make sure that we have intelligent policies. for example, if you get a visa, you come here, we do not track when you leave, so we have no idea how many people are here. we are not doing the things we should do, and that is why i think the 9/11 memorial is so important, to teach people a lesson. but that is not a reason to not have people come here. the terrorists want to take away our economy, take away our rights, and if you do not let immigrants in, they are going to win. >> i am sure that the federal authorities, the fbi are very aware -- i know that is the case in britain, but you look where you get big muslim communities.

they are all fine people. you want to have a look at the mosque and what they are being told. muslims are just fine, but there are a few who are rabble- rousers' and brainwashes -- rabble-rousers and brain watchers -- and brainwashers. they are watching kids who have got not a school, go on a so- called family trip for a year or two years, they come back, and they keep them under surveillance for quite a while. they are british citizens, just as they would be american citizens here. i think we are watching it pretty well, but i do think we want to look at what is going on in some of those places. >> what about if he wanted change the perception politically that immigrants take away jobs to immigrants create jobs, how does that happen?

>> i do not think that is true. i think it is only if the immigrant has worked harder. we have it in britain. because of the common market, people can move around. hundreds of thousands of poles went into britain. mechanics and plumbers and so on. they built the olympic stadium. it is a wonderful olympic stadium. i was in it last week. they built it a year earlier. i guarantee if the british had built it, it would have been all done in the last week in triple time. [laughter] yes, they are pretty popular. they behave pretty well. now poland is doing better. most of them have gone back to poland. but they just work better.

>> s&p did a study of correlation between how good a city is doing in america and the immigrant population. those with high immigrant populations had better credit ratings, better economies, better average education, lower crime, the sort of thing. i think if someone wants to demagogue, there are people who will believe slogans because they just sort of want to. >> but i think there is a certain situation, which has grown in europe where politicians have been lying and giving out money and borrowing and so on, and we have an entitlement state. we get in our newspapers hundreds of letters a week from people who are working really hard in the north of england, getting 15,000 or 16,000 pounds a year, and they are pretty down hard. next door, they have got people

getting 20,000 because they have got six kids, and they get every possible entitlement. that is pretty spread through europe, and that is why europe is now having this sort -- i do not know what sort of mess it will be, but you can rise up from it through economic growth for the next 10 years. but we do not want to let that happen here. >> make the case you guys are trying to make, you have picked a terrible time to do it. unemployment is 8.3%. how can you make this argument about immigration before the economy craters -- how can you do it in this environment? >> you have to in this environment. it is like how can you make an investment when times are tough? new york city walk away from its future back in the 1970's. they did not make any investments in infrastructure or maintenance or anything because the economy was bad, and it took

decades to work their way out of it, but if you go back and look at history in america of one great things were done -- central park, the empire state building -- these were things that were started at the bottom of a recession. there is a guy -- not barnett -- gary barnett. everybody thinks he is crazy. he has been building through the whole crisis, and suddenly, there is enormous demand and he's got these buildings. he just sold a building for $90 million a piece, and stop telling because he cannot keep up with demand. he is going to wait until prices go up. brilliant, but the people, leaders make investments when times are tough. leaders bring along other people, and the president of the united states, this one, where the next one is, they have got to bring along congress. it is their responsibility to answer your question, to explain to the public and make sure we do it, or we will not have a future.

>> we've got a great economy. the unemployment will go down. to get a great economy, we have got to have more and better migrants. >> two years from now, will this immigration system have been changed, or will it be the same one, and will we be having the same conversation? >> i think it will have changed. it will have had to change. >> i agree. i think the pressure eventually will get to everyone, and all of these things where we say the president and the governor are not addressing the issue -- they are not addressing the issue, they are unwilling to say anything -- that is still pressure that will be there after the election.

then, because the president fundamentally has a two-year, not a four-year job because midterm elections are really very important to his or her ability to continue on and to govern, so they've got a very short window. they have to address this right after the beginning, and it will come out as a bargain with everything else. just over night, everything, they will get in here, hear, hear, and you get in here, here, and they will have two years to put their constituency back together. if they do not do that, you will have a lot, and we will also have more experience about what happened in europe and how they can down the road. some parts, they will really have to face some of this. spain is in big trouble. italy is in big trouble. in greece, they're just does not seem to be a solution. merkel has got big political problems at home. -- in greece, there just does not seem to be a solution. asia and china's economy's just slowing down. it is not good for america. not good for europe.

all these economies are interdependent. people keep defending the chinese people. manufacturing in the united states has actually done very well. people do not understand how good manufacturing has been the last year in america. what it has not done as it has not created jobs. it is using technology, but we need a market to sell the things we manufacture. china is the biggest market in the world for us. we want their economy to be good. they also insisted the bill restores with things that people want to buy at low prices. the consumer is one of these days going to wake up and say, "wait a second -- i want them to keep sending stuff here. without them, i could not afford it." >> one very hopeful thing -- in the last few years, we have had enormous discoveries of natural gas in this country.

we have an energy policy for six or seven years, we will be totally independent of importing any oil or gas, and the gas which will go into the power stations and the coal will give out half the carbon in the coal dust. we will not have to worry about bloody wind farms and other hideous things. [laughter] >> glad to see you supporting the coal plants. >> absolutely. we have got the gas now. except in your state, we have a governor who has been very slow to allow it to be brought out of the ground. >> the politics of that will be interesting. we have got to close on an optimistic note. i love it. thank you, and thank you for making my life easy. [applause] i would like to thank our two very distinguished speakers for their eloquence on a very difficult issue. and what they are asking all of us is that when we meet the federal candidates, and comets, or challengers -- candidates, incumbents, and challengers, i think it is important that we elevate the discussion, and it is up to is to elevate it. these wonderful, creative, innovative young men and women that get these master's and ph.d. is here, that is where all

of the finest colleges are in new england. it is a shame that we send them back to their country, who want to stay here. they go back and create these wonderful products that they sell to us.

it is the knowledge they have received here. we cannot agree on your eloquence on this stem visa. we have two international speakers. it says an awful lot of boston and new england that we would to some to come here. i would like to give you a token of appreciation. they are international speakers. the mayor alluded manufacturing is back. it is back in new england. we have this chelsea clock that is made here a few miles to the north. the mayor knows it well because the mayor's father grew up in chelsea. a chelsea clock is a company that manufactured these clocks here, in new england. made in the usa.

i hope you enjoyed your presence. we look forward to working with both of you. [laughter] [applause] >> tomorrow, the executive director of the independent women's forum joins us to talk about women voters followed by a discussion on deportation and the dream act. our final guest will talk about new estimates that increases the loss of the 2009 auto bailout to revive dollars billion.

$25 billion. live said 7:00 a.m. eastern on c-span. >> i started as a copy boy at "the new york times." i was in a training program when i get out of the army for the wall street journal. >> walter pincus talked about his various jobs ats a journalist. >> they built a $4 million facility for the band, which is about 40 people. if you spent $4 million on an elementary school, that would not raise questions. >> more with him sunday night at t 8:00.

>> good morning. welcome back to the second day on our political system, "which way out?" this is the 21st annual seminar at the vail valley institute. i do not remember being as excited with four speakers. we begin with harvey rosen, who has a ph.d. he has been a member of the economics at princeton and is deeply involved in both public service and academia. he was very much involved in teaching and mentoring students at princeton.

he has been a percipient of numerous prestigious awards. it is a great pleasure to introduce harvey rosen. [applause] >> thank you for that very kind introduction. they have been telling me how wonderful these events are at vail. i know what they mean. it is delightful to be here. across the entire political system, there have been indications that the u.s. protocol said that is dysfunctional and even pathological. i was asked to talk about that. if you want to know whether something is dysfunctional, the

first thing to figure out is what is the function? i checked the constitution. the founders took these very seriously. george washington said it was an important source of strength and security. we may be cheers in it a little too much. it is clear that things are not working if you look at the budget numbers. it is another indication that things are not quite functional.

madison said it would be little help to the people that the laws made by man that are incoherent that they could not be a understood. the most natural explanation is too partisan. many americans believe there is too partisan fighting between the two political parties. there is an alternative to that congress is as partisan at it always has been. it is built to fight. think about it. every committee as a minority staff and a majority staff. it has a chair and a ranking member.

it is a feature of the system. if we have a system where we encourage them to fight, how does anything gets done? this is a question that was considered by economists after the 1950's. one economist won a nobel prize. it is hard for democracies to work and to get consensus. but he listed some circumstances under which it would not be hard. many of it was that there was not much disagreement. today there are lots of disagreements. there are fundamental

disagreements about the role of government. how were they solved before? this is a political issue. imagine a story of a guy who survived 1889 and he was really remarkable. he decided to spend the rest of his life studying, which he did. he died and went to heaven. when he was getting his orientation, st. peter told them that they had conferences on various topics of interest.

this guy said, well, i happen to be an expert on that. i would be happy to talk. st. peter said, luckily we have a spot next week. we will put you in there. one of the people in the audiences will be noah. the question was, politically if you have a disagreement, how do you get -- the president can bribe members of congress. the president can provide cover to members of his own party. that is failed presidential

leadership. this is obama up speaking only two democrats. we need of both parties to work together. one cavaet to this view is the gerrymandering issue. i like this framework. i was thinking about it. gerrymandering fits into this framework nicely.

what does it mean when more and more constituents need to be bought off. if we have this problem where we are dysfunctional and the parties are not talking to each other, what can be done about it? it is natural for me to think of it in terms of budgetary issues. my discussion of these ideas will be framed that way. i would like to talk about this one view that if we passed the right set of rules, we could fix it.

that the rules right. we can fix all of this. most of them are legislative lawyers. pass a law. find the right law. i would like to discuss some of these. it reminds me of my job when i was on the council of economic advisers. i once heard someone characterized the job as flushing roaches down the drain. there are roaches coming up the sink. these roaches are ideas. they can come from colleagues and what you need to do is flush them down. when people say, what did you accomplish when you were in

washington? you say you those flushed down. there are theories that there are to double much money and politics. let me talk about a man who has degrees in both philosophy and law. some people think the government is awful. as a democracy, we should have a good government. why have democrats we have elected have gotten things so wrong?

one explanation is that the voters were misled. consider the liberal media as a source of the information. each side strongly believes there democracy would work better if the public heard a good deal less from the other. in other words, it is precisely the desire to restrict political speech or otherwise unsuitable for the voting public. this raises all sorts of interesting political issues. i want to ask the following question -- how do we know there is too much money? more than $4 billion was spent in the 2010 cycle.

that is a lot of money. those elections put members in the house and senate. there is a sense of the scale of the 2011 super bowl advertising and how much was spent for 30 seconds. to me, that raises a problem why so much is put at stake. does money matter very much anyway? it is convenient to blame the nation's problems on special interests. well, what about the correlation between dollars and winning? tell that to meg whitman.

just because you see a positive correlation, that does not tell you much. could be that donors to a candidate that they see could have a victory.

there is a popular writer who did empirical research. a number like that gives a false sense of cynicism. the point is that it is not very obvious that this money is swinging elections. at the end of the day, common sense tells me that if you stayed too far from your constituents opinions, you will not get elected. there was a wonderful presentation given last night. there is a disconnect between the elites and the normal people.

i found that research compelling. on the other hand, mitch mcconnell is from kentucky. the constituents have a certain view and they are reflecting it. how about another idea? line item veto. the claim is that the ability to veto certain spending reduces undesirable expenditures. you need to give the president line item veto. ronald reagan asked for it. bill clinton asked for it. what do we think about that? the labs have been busy at work. a number of states have implemented line item veto and have been doing so for many years.

it remains to be seen if line item veto has much of an effect. it does not matter very much. anything that you care about is not seem to have much of an effect. it is not clear and here is why. the president and the congress are always bargaining with each other. they're not talking about building a new dam in alaska. there is abortion, you name it. all the line item veto does is strength in the president's and in promoting his own interest. you might not care about having the salmon from alaska, but if the president wants to get a

vote -- what it does is alter the power within the government. another problem with this notion suggests that our main problem is entitlement. they did not appear in the line item budget. there are on autopilot. that is why it is called entitlement. ok. we have lawyers at work. maybe we need something tougher than a line item veto. if you do not like the deficit, what do you do? pass a law against the deficit.

if these targets were missed, across the board cuts would happen. that sounds scary. according to the senate republicans' top adviser when the bill was passed, the first thing we did was to ignore it. how do it up the ante? amend the constitution. we can have a balanced budget within the constitution. we can have a constitutional amendment.

i do not think that will work. let me give you a few reasons. last i heard, we do not have airvoyance working in washington. if the have a lousy forecast, congress might be in violation of our constitution without even knowing it. i think in general that is true, but we cannot count on it. second, the amendment would hopefully be transparent and britain to it would be less than 2700 pages. at the end of the day, it would have to list domestic products. these are all a concept by using suitable conventions the congress could in the system. the events of the past 48 hours -- what is the past?

the supreme court provided an example for me. what about loan guarantees? when the government retains a loan, how much? it depends on how much you are getting paid. is it controversial? yes. but it would have to get done. do we really want people from the supreme court arguing? here is another question -- what is the government? the know why fannie mae is our protest? -- do you know why fannie mae is arbitrized?

the state and local government uses dodd-frank all the time. their 40,000 of them. special bid checks are entity set up so that they can borrow -- special interests are entity set up so that they can borrow. what do we do? we roll our eyes. we shake our heads and we move on. what happens if there is an amendment? can they stop government activity? we want the courts more involved in policies?

i think it would be a problem. bottom line, and after which rule is adopted -- no matter which will is adopted, the problem is that all members of congress have strong incentives to spend more and to pass less. unless the political and economic environment in this. public sentiment is everything. with public sentiment, nothing can fail. if there were constitutional amendments, there would be endless amending of the rules. it would take a different form. another nobelist made a point i tried to make before with my roach example. i think this applies to leftists on utopia.

after i heard a story about budgetary issues. the organizer got up and said, i cannot take this anymore. i am opening up the bar right now. that might be the best advice i can offer. thank you. [applause] >> thank you. our next speaker is craig barnes. he has an impressive and intimidating background. he was an infantry officer. he was a trial lawyer. he was an international mediator.

he applied his work in many places. he was a founder of the colorado common cause. he is author of an incredible variety of intellectual pursuits, one of which is an example of the roles of women in theology. he has a trilogy of plays of elizabethan england and a passionate book called "democracy at the crossroads." craig barnes. [applause] >> thank you, governor. nice to see everyone here. nice to be invited.

it is a pleasure to be here. i appreciate the invitation. thank you to harvey for spelling out the most articulate and a persuasive argument i can imagine. [laughter] in a little part of my early career -- it is an honor to be on the same program. in my early career, i began traveling back and forth to moscow and negotiating nuclear issues with the academy of sciences. after that, i found myself in disputes in the war.

later i was a negotiator for the u.s. government and the dispute over international river's. i came home from these troubles a flaming patriotism for the rule of law and prepress. i had won some cases in american courts. i have lobbied in the courts and congress. i had a run for high office and affective introduced the sunshine contest. i new democracy firsthand and i thought i knew in deeply. i came home from these years of our experience events that the difference between u.s. politics and politics of either asia are russia was as wide as the grand canyon. the conclusions i share today, in part from the contrast between what i consider to be very different cultures and the political experiment which we initiated on this continent in

1776. the most of history, wealth and power go together. as wealth grows, its owners tend to surround and invade government. with the help of garment, increase their position, thus concentrating the world even more -- with help of government, increase their position, thus constituting the world even more. it was too and to support the heavy crown and the whole thing toppled over. supporting the government at the apex, the ship of traditional governments around the world is the opposite. the wealth is at the top and the rest of the bottom. think of a monster with the golden glow at the top. -- think of a mushroom with the

golden glow at the top. think of "tale of two cities." think of rome or florence. as the crown grows fatter, marie antoinette retreated, and the presence drew restless. when people lose their belief, the stem of the mushroom disintegrates and the crown falls over. that is what we saw in the air of spring and in france in 1789. -- that is what we saw in that arab spring and in france in 1789.

john anger was burned. -- joan of arc was burned. in every case, the case was freethinking. the danger was not the thinking, but the erosion of power. and in the first half of 18th- century, the scottish began to see this pattern. luxury kills. but timing get to tom paine, he writes in "common sense" that we should put all of the crowns in a bonfire and burn them. we should charge rent.

there is moral sentiment no moral sentiment in aristocracy. the republican would allow a portion do have influence. to some extent, madison succeeded. more people had access to education and participated to some degree in elections. madison and his fellows felt in some sense. the constitution treated a non- democratic supreme court. they could exercise the power over rights to be a human being and for women opossum rights to vote and over taxation.

-- for women at's power to vote and over taxation. in the process, they have corporations and unleashed sources, including the potential of any member of the russian mafia of the mexican drug cartel to influence the so- called election of ordinary americans. with some exceptions, the supreme court has been a tool. it has been a tool for wealth. it has been in constant opposition to democracy.

it is no coincidence that economic opportunity or due process are drawn by jury are not enforceable with this hypocrisy. they do not have a word to try to enforce their nests in russian court. the russian revolution changed the players, but did not change the culture. they have a government that reinforces inequality by sending challengers to siberia. in this factor, they are in tune with most of history. it is why that american democratic experiment is such an anomaly. unfortunately, classic is

autocracy has now someone emerge in american politics. it is reinforced by scientific ideology, drafted by ayn rand. this ideology is the cause of our current consumption, the subject of our discussion. when i grew up in the wheat fields in eastern colorado, we gathered together in the summer to help each other bring in hay and chase the cattle when they got out and driving together to the county fair. did did this store propagated however is that -- that there is no such thing as society. that changes the american story from the common good and the community to one of individual freedom.

contrast that to james madison and the federalist papers in 1788. we may define a republic to be a government which derives all of its powers directly or indirectly from the great body of the people. directly or indirectly from the great body of the people. that is the great body of society. not from a favored class of it. otherwise, a handful of tyrannical people would aspire to take over. a handful of tyrannical nobles might aspire to take over government. that is quite different from what margaret thatcher said in that there is no society. if there is such a thing as

society, margaret thatcher is contrary notwithstanding. madison favored class of tyrannical nobles. there is the responsibility for the general welfare or the common good. author of the constitution and soft as opposite of democracy. today, americans demographic is that 400 people have as much wealth as 90 million americans. americans -- wall street ceo's in 2010 received bonuses of $90 million. it is an amount greater than the gdp of 23 countries. that creates an unmatchable gap. the rest of the american

population is expanding foreclosure and job losses. the american people brought the bank's back up. no one learned very much. they went right on paying those extraordinary bonuses and not knowing that their support was shrinking. another stunning figure -- 6 wall street figures are richer than many americans. think of that. literally unlimited resources, they can pick and choose when to fight it will pay for women to the supreme court. if they did that act down, they can turn their briberies to mexico and turn in illegal to the gulf. -- legal.

luxury is the enemy of virtue. luxury is also the enemy of democracy. the u.s. chamber of commerce and the koch brothers plan to spend $1 billion in this year's elections. in last vegas casino owner said he would spend $100 million to do whatever it takes to beat barack obama. and in washington, a rumor were circulating two weeks ago that these billions are being used to buy ads now.

that means obama will not be able to advertise. does that seem like that destruction of free speech? you would be right. in 2005, dick cheney guided the oil and gas lobbyist who spent $750 million persuading congress are hydraulic fracking from the clean oil act. that seems like a massive amount of money. in 2009, in the fight of the health care bill, the health industry spent $4.1 million per day in the first five months of lobbying against these health care reform bills.

that seems like an amount of money available to patients for an elderly, uninsured, the port, or the small business, all who had a great interest in health care. there for, that amount of money overroad a normal person's voice. that is the destruction of our democracy. and a 2011, at $62 million of an income pays taxes at 24% and mitt romney pays taxes at 15.9%. every school teacher and every part across america and pays as high as certify%. -- 35%. if that seems to like a system that favors the wealthy in and disproportionately finances schools, libraries, and roads, you are right on that as well. as far as i can see, there is no sound economic reason whether

the in europe and dignity and managing investments compares the dignity of teaching or nursing. this system shows countless years of countless lobbying, even to the point that lobbying wants taxes on capital gains to be abolished altogether. corporations need more profit to invest more and create more jobs.

why at this time when corporate profits or at record highs? eliminating capital gains will give them more profits, but it will not create more jobs. the hypocrisy to corrode democracy. we would be read on that account as well. on that count as well. the final an the final analysis is my own experience in negotiating. the democracy -- those values we should treasure most of all are truth telling and non- violent and the opportunity.

they're not written. they are fundamental for this democracy to succeed. imagine that your mother has a heart condition and is to go to the hospital and you have to negotiate to get her into the hospital. when she gets there, you have to negotiate with the doctor to get it taken care of. that is corruptive in a practical sense. imagine if your scientific results, you cannot share with them with anyone. , you cannot share with

them with anyone. even falsify at and try to make up your report as they did in the soviet union. -- you could falsify it and try to make up your report, as they did in the civic union. what happens if the figures are fudged? you could be describing russian politics. you could be describing chinese politics. if it the common good depends -- the coming the depends on the integrity. the ultimate source of our dysfunction in study after study is welt disparity.

a huge wealth disparities. not just a little. i am not talking about the 1% of the 99%. there is a huge gap of what this party. the result of the population as a whole is raised in helplessness and mistrust. business does underlies the ability for people to participate in politics. that the mix the not want to participate in a boating. the gap is too -- elainvoting. the gap is too great. it breeds obesity.

it breeds lack of mobility. it means a limited life expectancy. there is a wealth gap. you will know where you stand compared to the rest of the developed countries. all you need to know is that where you are because the wealth gap undermines trust and its dysfunction. to restore things in the u.s., we need to return government to the whole of people. we need to get corporate money out of politics. we need to declare that corporations are not people and that money is not speech.

more significantly than any of daythese, we have to revise the understanding for the compassion and generosity that is part of our genetically programmed him and make up. we humans will survive together or we will not survive at all. it is participation by the greatest number that opportunities is spread and education for the greatest number that can turn history on its head as it can to do -- we attempted to do. they do not have a word for fair in russian, but we do. democracy is flawed, but it is better.

thank you. [applause] >> craig barnes, thank you. tom cronin is an acting president at colorado college, where he now holds a ph.d. at stanford and was a white house fellow. he is a much demand speaker and commentator. he wrote a very well received a book on leadership. tom cronin. [applause]

>> thank you. thank you for my inclusion in the vail valley institute seminar. thank you harvey and craig for those excellent opening remarks. i will talk about the american presidency and expectations that we have in a democracy. but me begin by saying the profits of gloom about the does functionality of our elections are the american constitutional system have been with us since the very beginning. let me share with you one observation about the election of 1880. if thomas jefferson is elected,

said a respected individual, the bible will be burned. we will see our wives and toghters of thsubject prosecution. that was said by a reverend. he talked about the horrible things that would happen if jefferson was elected. let's talk about the prospects of our political system. this was a presideial election. right now we are in the 57th presidential election. 21 times we have transferred power from one political party to another. this is a singular achievement. no other nation that i know of

has had regular elections and has figured out a way to transfer political power from one party to another. the presidential box congressional separation of power -- presidential- congressional separation of power is slow. it is slow to embrace certain things that many people think need to be increased more quickly. it has a tough time solving issues of inequality. it is a framework and a structure and a foundation rather than a document. we have to supply the values and underline concerns and principles. we have campaigns that are very

expensive. the amount of money for some campaigns seems rather small compared to advertising companies. there is a strange device that we would not have invented today. i know there were compromises made at the constitutional convention back and we designed our presidential-congressional separation policy. we need to take a moment to celebrate that it has worked on many occasions. for a moment, i might sound like a chamber of commerce commercial, but looking back of

the last 70 years, the system rose to the occasion in world war ii. old war ii was successfully executed and completed. -- world war ii was successfully ocompletedt competeand and won. there was a high rate system that we can be reminded about -- highway system that we can be reminded about. eisenhower and congress could to gather. that is an incredible achievement. it took many years to be completed. it took a long while to get him

in the final picture in this region. take the highway system as an example of the common good and doing something in a humanitarian way. there are other issues that are incredibly important. we have the clean air act and the china initiative. those are examples where congressional leaders and the president had the foresight to make our system work. the reagan era, tax reform of 1986. we look back and see it could have been better, but it was an achievement for democrats, republicans, for them to work together. people thought it was impossible to get done.

the artistry of politics is spirited debate and problem solving. the bush era and obamacare economics and the automobile industry -- those are examples where both parties worked. in the obama era and the affordable health care act of 2010 seems to have more legs under it than it did a few days ago. in a remarkable collaboration begin congress and the white house, but now the supreme court as the third branch. it was a remarkable contribution. it is too early to digest what the role of it was.

my point is let us remember that on occasion not every day and not every year and not every legislative -- usually there are two or three rather significant steps forward and are progressive and that serve the common interest. that does not mean that problems have been neglected that great, inequality, in particular. -- that to create inequality in particular. we look at the opportunity. we tried to bring that about

through legislation. we have a state legislator in the room from colorado. the person has been a fighter for minorities and immigrants. we salute him, michael johnson, for his work in that effort. the obama administration's made additional steps. i think both leaders are trying to figure out how to respond on immigration to make sure we can have people come to this country, but also have the opportunity to live a decent life. i want to say a word or two about the splendid talks that are given yesterday in. >> he has several books.

we are pioneering works in political science. he is largely correct that the american people have more in common about issues than many of the leaders in congress. there are issues that divide us. they get soft and we move onto other issues. a study that i have just completed in colorado politics, we found statewide respondents -- there are about 20% of what we call principal conservatives, who would never wrote for a democrat, tea party conservatives. they are counterbalanced by maybe a dozen or 12% of what may

be printable liberals. they rushed and listen to rachel m-- watch and listen to tachel rachel maddow. that is at most 20% on one side. most are pragmatic, pragmatic liberals, pragmatic conservatives or moderates who are willing to split the ticket and carefully make decisions. there is a large room in the middle. read the last three paragraphs of a book that is going to press in a week or two. it echoes a little bit of what both the arenas of research find nationwide. the last paragraph says -- most

people in colorado are not on the extreme right or left. they are not orthodox or rigid. they do not rule out of the views of good ideas that are held by other parties. some politicians may be polarized. most people from colorado are relatively small liv moderates. they understand politics is needed, and politicians bring about compromises. independent voters play a large role in a state like colorado. they agree on many more policy matters then there are divisions. they want a better colorado. they want to come together to fight forest fires and to make

for better roads and a better higher education system. the higher education system is embarrassingly starve to -- starved. person should is desirable. people have differing sensibilities as well as the views about the relative importance of liberty, equality, and social justice. politics comes about because society has to make choices about how to solve problems. there'll always be disagreement. humans could sharpened. most of colorado's political leaders will family debate about policy challenges without becoming disagreeable or mean- spirited. there are some exceptions. for the most part, people are willing to talk and debate.

politics in a spirited debate, compromise and problem-solving are the artistry in a constitutional to receive. we should cherish and celebrate, and we should shout out to those are effective artists. politics is a performing arts. when me add one other theory -- the change comes about in this country were often from the bottom up than from the top down. that is to say, when we want to have women's rights, very rarely is it to have an american president or majority leader in congress lead the women's suffrage movement. it usually comes from the bottom up and takes decades and

several elections. it usually takes some of agitators', who will star stuff up. people who could not get elected. this is to left and right. tax reform has come about often from angry people on the right who challenged things in california, like proposition 13, which captured the interest of governor reagan and brought about certain tax reform. issues of environmentalism. no president was a leader in the environmental movement. the only person who may have been in at one for act two leader -- if you see a gun in the wall in act one, it will go

off in act three. if you look hard, we should not give credit to most president for solving problems and saying lincoln sought slavery. lincoln did not believe in the abolitionist movement. he had 15 ideas about slavery. he was late when it came to what should be done. there are movements. mothers against drunk driving. that is not left or right. i do not necessarily agree with everything they believe in. it was a bottoms up movement -- one of her family members was killed by a dui incident. she went to city hall, and got no response. she got to other people who were

in office. they said, we take this very seriously. there was light sentencing. within a matter of -- she went from being an act one agitator to a woman who decided she would get other mothers and baulked. eventually, madd was -- if you were running for office in the 1970's or 1980's. there would always be a table of mothers against drunk driver with pictures of their relatives who have lost their lives and information about the white censusing -- light sentencing or none. this issue got up to the white house to reagan, who was against

federal regulations, except the mothers for truck driving -- drunk driving wanted to raise the drinking age. he tagged onto legislation. places like montana have to raise the drinking age to 21. he was nominally against regulation, responding to and ideologically neutral group that wanted to bring about some change. if we want to alter things, we need groups. repeople most of the time will respond if there is welling up

from beneath. they are after a while the representatives of our system. i want to ask our guests to speak about the taxation -lements of the simpson bowles. a lot of people probably endorse the general concepts of a grand bargain or compromise and which spending and tax exemptions are brought to the table. this is something america is not good at. our constitution is not good at focusing something as large as that. we tried that in the tax reform

act of 1986. a compromise version commercial. it was a step forward. we are talking about something much more comprehensive and much more needed. i would love to hear about that. what is my time? five minutes? we expect a lot from american president. we force them into saying, i will be a united -- united, not divider. i will change the way washington works. i will change the way lobbying is done. when he gets going, he said he will change the way the world works. everyone who listened to the rhetoric had to have an uneasy stomach. we knew enough about washington, d.c. to know that you're not one

to change it very much. on day one, you're one, lobbying doubled in size. economic stimulus money became available. more people wanted more money. presidents often are very visible. we know we need hamiltonian energy in the american presidency to make our complicated system worked in a way to achieve resulting ends. we need hamilton energy. retried after watergate to have a weaker presidency. four years ago, this month, watergate occurred. the presidency was bruised by a variety of crimes.

there are efforts to rein in the american presidency. by a lot of noble people. it did not work. we knew that we need our system to work a presidency and a cabinet and some hierarchy that a emergencies.r version see we read strengthened the american presidency and had ignored a lot of constitutional constraints on budget matters as well as the war powers resolution of 1973 and similar efforts we are trying to force president. that is not a happy story. president probably have too much power in the age of drones and

secrecy. presidents are usually affected during crises, honeymoon years and when there is high popularity and prosperity. presidential popularity and the american people is fascinating. we lose confidence in president rapidly. truman lost 50% of support in public opinion over a three-year period. lyndon johnson lost 30%. nixon lost 40% over a two-year period. carter became unpopular in his last term. his own party challenged him. george hov bush-- h.w. bush, one from 90% public approval to 35 per cent in one year.

-- 35% and one-year perio. obama started off with 53%, but he began with 50 -- 65% during his honeymoon time. now he is at 38%. obama enjoys more public approval ask congress, more than the supreme court. more support than public schools, banks, and a slew of other institutions. why are we so tough on presidents? we put on them would -- what we

should be doing. we want them to unite us. it is a tough position to unite us. they have to make tough decisions on budgetary decisions. whoever gets elected in november will have to address the fiscal cliff and the economic decisions. well that made them popular? probably not in the short term. any time in natural disaster occurs or a recession occurs, or we do not like a war, as we did not like the vietnam war, who do we blame? we blame the person at the top of the pyramid, the american president. we are tough on president. we tire of presidents. we are impatient. presidents will respond if we,

the people, care about issues, the values we talked about earlier and to recognize that we have to help point the way. we want leaders to leave us in new directions. most of the gimmicks that are suggested to change the presidency or the election systems are liabilities. i agree with professor rosen, who suggested the proposed line item detail or for constitutional amendments are an illusion, just like the illusion of entitlements for -- term limits for congressmen. we have a term limit for the american presidency. also, for the supreme court.

term limits for congress to make no sense. we have term note now. the initial research evidence is power transfers to lobbyist, to the executive branch, to the governor. power moves. there are few reforms that i support. in anchorage -- in correct opening of the election process similar -- more people can vote. i am against the voter suppression. we should have a boat king holiday, voting by mail. -- bolting holiday, voting by mail. i like the idea of we may have a

filibuster percentage requirement lowered to 55. we lowered it from 67 to 60. it may help out. we could get a compromise on things of that order. most of the changes we need are changes in values. who are we as a people? what do we want to achieve? do we want to be an inclusive nation? what kind of tax reforms and entitlement reforms would be fair and balanced and makes sense for the kind of a country we aspire to be over the next century? thank you very much. tom.hank you, a our last speaker is a professor

of science at stanford and a senior fellow at the hoover institute. this is his second time with us. we were so impressed with him at the first time. we were compelled by his message. we cannot wait to get him back. he has been elected to be in national academy of sciences. his groundbreaking work brings him back again. his culture wars' made him a nationally recognized expert on politics. mo fiorino. or.thank you, govern

i had to wait to hear what people would be saying. i will try to draw some threat between this because we heard today. -- france between -- threads between the speakers wither today. most of these we have discussed have been disappointments. there is good literature on this that concludes they do not make much difference. in california, we have those kinds of things. they are like keeping squirrels out of your house our garden, they will find a way in.

they will find a way around these rules. if you have more competitive representatives, you will elect more moderate representatives. there is literature on this going back in time. if you are only having nine% choosing their nominees, you end up with the same kind of extreme candidates. it is one of these reforms that is good in and of itself. the notion that elected officials get to choose their own constituents is perverse. we need to have a more nonpartisan-oriented mission. it will not have an impact on

the problems we face. there is literature on term limits. you have to make judgments. that is a negative judgments. california, they move around. they go from the house to the senate, senate to the house. they are always running for reelection. they are always looking ahead. it has made depended on interest groups worse. money is the big one. the anecdote has been mentioned a couple times. the precise picture -- picture -- procter and gamble spent more

money advertising in the year than the entire electoral cycle. it is like how many people are watching rush limbaugh. harvey referred to the in dodge and 80 -- public interest groups as soon one way causation. the process is more complicated. after a congressional election, italic of the top 10 phrases in the house of representatives. in the top 10 races, several of the people lost the election. everyone else ones by about a 52%. -- everyone went by about a 52%. it is the anticipation of what

will happen that make some raise money. donors give to people they expect to win. you do not have a lot of money -- you do not win because you have a lot of money. scott walker and -- the democratic party could have done more money into that race. they made a calculation they would not win. he had a lack of money because they expected him to lose. diminishing returns. the more you spend on something, the less impact he will kick if you go up. in these swing states, there will be ads that say if obama and romney have a certain

amount to run as, that will be affected. they are wasting a lot of the money they spend. the debate on the popular saw it presents the american public is stupid. children learn the difference between commercials and serious stuff when they are four years old. just because she won as, you will win an election is been customary to the american public. -- is on complementary to the american public. crack appealed to our emotions in a powerful way. craig appeal to our emotions in a powerful way.

spending so much time on a campaign funds is not the way to gut -- go in reform. equality is important. if i have been one of obama's political advisers, i would have said, the first thing you do is indict every wall street person you can. make the perp walks. the american public is upset. the people who played by the rules screwed. the people who screwed us are getting bonuses. from the political side a lot of the toxic attitude is americans are convinced this whole catastrophe is the wrong people

who were rewarded are the wrong people who got punished. i sympathize. the tax system -- harvey should address some of this later. labor is not mobile. they cannot take off and go to sweden. international -- we look at these issues. from an american parochial prescriptive -- perspective, we look at a problem and says what about the united states it that makes it a problem? it is crawling around the world. it is growing. globalization. we tend to focus on things that are minor factors while ignoring the things that are bigger out

there, some of which we can control or tried to ameliorate their impact. civil society. we do not have the kind of system that many of the screw up with where you had strong associations outside of government. we grew up -- every town had a rotary or farmers' association. these things have gone by the boards in most communities. we do not have this rich layer of civil society in between government and the ordinary people. many of these people think there is a tension between governor -- government and civil society.

in europe, they have never had this kind of infrastructure. the government are strong. people rely on governments to take care of the problems they face. in philanthropy -- americans give away more than your opinions do. europeans figure that is the government's job. you can criticize us in a lot of ways. the fact that we do not have a better government makes us more self-reliant. tom cronin is an optimist. i hope he is right. the darkest night is before the dawn. the words i feel, maybe that means the closer the turnaround is. he talks about the presidency. those were a proper remarks. the disappointment people feel

with the obama presidency is that expectations were set so high. there was the sense of turning the corner with change. we get the same old. i did not have enough time to get through the slides. there is period of indecision at the end of the 19th century. no party had full control of the government for more than two years for a 20-year period. when you look at these polls about presidents, the great ones were great during periods of unified control. often, 14 years, the party controlled everything. they usually come from that period of divided control. were they pour presence because of the conditions -- poor

presidents because of the conditions? we shall not lose track of the context. we are in a tough year. all governments have a tough time taking things away. it is good to give things away. how much? who gets it? when you have to take things away, all governments have trouble. it is happening everywhere. in europe, whether it is parliamentary. we are in a situation with entitlements, debts adn government have toake things away. we are in for tough times. i hope that is wrong and we have a sudden burst of economic growth. i do not see it coming. we are in for tough times.

>> this ends the part of this morning's program. we will have a dialogue between the speakers. thank >> two live campaign events from around the country. at first paul ryan campaigning in tampa florida. join us for live coverage at 10:00 eastern on c-span. president obama attends a campaign rally in the afternoon.

our live coverage begins at 2:00 eastern. >> i started as a copy boy in the new york times. i was in a training program after i got out of the army for the wall street journal. >> this sunday, walter pincus talks about his various jobs as a journalist, his views on extravagant spending overseas. >> they built a $4 million facility for the bandit, which is about 40 people. -- the band which is about 40 people. if he spent $4 million on an elementary school i bet people would raise questions. >> sunday night at 8:00 on c- ."an's "q%a

>> panelists discuss the consequences of increased exports from the country this year and the outlook for the international oil industry. this is just under two hours. >> good morning. good afternoon. it is already 3:00. thank you some much for joining us today for a panel on iraq and the oil sector. i want to thank our distinguished panelists for taking time off from their busy work schedules or perhaps their very relaxing vacation time to share with us their insights on iraq. today's even to is the third in

a series of panels on a rock band -- iraq. did it program on the u.s. a rocky relationship. we looked at their relationship with their arab neighbors. if he were not able to check those out please check them out on the youtube. coming up we will be looking at irans relationship with and turkey and looking at the political situation. i want to thank shell for their sponsorship of this series and a particular recognized tracy for her encouragement and support. this series i think is a valuable at a time when iraq is on the the the front and back pages of most newspapers. when it is it is to report on a tragic bombing such as the one that took place today.

there were several killing more than 49 people. there was an attack on that iraq oil facility. and yet iraq remains of important -- enormous importance to the united states for many reasons. it is critical that here in washington where policy is made of those interests in a rock banking have access to a substantive discussion that can inform policy recommendations to this vital country that is extremely culturally and historically rich. i also want to recognize another individual who has been a supporter of mei. this is his second public appearance this week on c-span. he is having quite to the week.

earlier we launched an mei scholar paper looking at iran relationship. please go online and check it out if you have not already seen it. allen knows quite a lot about iraq as well because he served as the be assistant -- he served in posts throughout the middle east including in baghdad. hopefully he will share a story with us today. thank you alan for taking charge of the panel. i would like to invite you to the podium. >> thank you very much. i did serve in baghdad, but it was a long time ago. it was so long ago that saddam hussein was the vice chairman of the revolutionary command council.

we were the reporting part of the embassy. i reported on oil among other things as the economic -- david was the political officer. i have to say we were not to their exactly as part of the u.s. embassy. we were there as part of the u.s. interest section of the belgium embassy. we outnumber the belgians 11-2. things have changed. i was a deputy assistant secretary that covered a rock band. i call myself the dispute -- for iraq. it included libya and all of north africa. i know you are an adviser. i believe there are now for people or for deputy assistant secretaries covering that terrain.

it is a sign of the times that our largest embassy is now in baghdad. one of the things that links all of these relationships through the now 30 some years that i have been involved is oriole. therefore i a particular look forward to this panel. -- have been involved is oil. the topic that runs through it all is iraq and the politics of oil. our first speaker is the iraqi commercial counselor. he has been an adviser on foreign relations. mr. al.hassan.

second is raad alkadiri from pfc energy. he leads a team that focuses on political and sectorial factors that influence decision making and oil and gas producing states. he will follow with an examination of the politics of oil. third speaking will be denis natali. she is at the to institute for national strategic studies at the national defense university. she has a long association with iraq. she will be talking about baghdad and the relationship as it relates to the royal successor. a last will be brett mcgurk.

he handles matters relating to u.s. policy inf -- in iraq and afghanistan. he will wrap up our session with lessons learned it through the prism of 2007, 2008 and the 2009 oil did rounds. with that the floor is yours. [applause] >> thank you. thank you 4 raging this event. it is my pleasure to be part of the distinguished panel. -- for arranging this event. it will be difficult for me to talk about the oil sector for 10

or 12 minutes. a thought about five years ago when i was coming to this city, we mainly focused -- i took over military security topics. after five years, our main focus is to talk about economic relationship between iraq and the united states, cultural respect with the military security. i am glad to brief you about our vision, achievement, and it challenges and opportunities in the iraq oil sector. probably all of you know the a rock -- iraq oil was discovered

-- the last 50 years it became the main source for the iraq budget. the secretary. -- it was affected by wars, sanctions, and bad management for decades. as a consequence, oil exports fluctuated. there was a delay in the investment programs for both oil and gas, especially for the guests that was being burned. -- the gas that was being burned. the oil played an important role in the iraq economy. it funded 95% of the iraq federal budget and employed more than 100,000 people.

it is the glue that sticks the country. let's talk about some numbers. in 2003, crude oil production reached 1.5 million barrels per day. it rose to 2.2 million barrels per day in 2008. it reached 2.5 million barrels in 200011. a growth of 85%. an average for the first half of these years was 2.7 million barrels per day. the area of the exported oil -- we were exporting around 1 million barrels per day. that has increased to 1.8

million in 2008 despite all the damage basic oil exports happened after the war -- before the war during the sanction. then it was 2.3 million barrels per day as an average for first half of this year. to compare where we are right now compared to 2003 is almost 130%. the quantities of the crude oil locally was increased but slowly from 340,000 barrels per day in 2003 to reach 484,000 barrels per day in 2008. and recently we reached 567,000 barrels per day as an average

for the first half in 2012, which presents a growth of 67%. everybody probably does the iraq oil sector. a huge crude oil reserve confirmed and iraq putting it in third place worldwide. we do have one of the largest and gas reserves and also we have a competitive advantage. low attraction costs compared to many other oil-producing countries. however, although we have a route 80 years of experience in oil operation, there is a lot of area for development and improvement. that includes the transportation

of crude oil, extraction, and isolation of the oil and gas and many other areas. if we add years of the sanction and wars, there is a lot of area for experience that needs to be gained. we want to get it from the international companies. the transports, pipeline network does not function the way it used to be. that requires a lot of work could enter this area. insufficient number of in the iraq courts and all refineries, which most of it cannot meet environmental regulations. we continue to burn a lot of gas.

as you can probably imagine, the list of challenges is and less. a couple of our friends here will probably focus on the challenges that we have. however, our vision is to increase the protection capacity in the -- production capacity in the field of oil and gas. also to increase the amount of the area that we expected the oil and gas reserves and it definitely would like to do that wisely with protecting our environment. the list of the objectives and goals of the a rock government -- iraq government. for about 10 or 12 minutes, it is long. one of the keys that we are to

open a number of the fields for foreign investment. and we did so -- there is one more coming. all that to increase the quantity of oil exports from iraq. also to gradually increase the capacity for our crude oil storage. in addition to that, we would also like to work on the area of refinery. right now unfortunately because we had a lot of difficulties in that part, import products from other countries. while we export a lot of crude oil.

mentioning all of these challenges does not mean we have not achieved a lot of tangible goals. we increased the capacity of refineries by adding more units. we increase the requirements, storage capacity is now at 16 million barrels. we plan to double it in the next five years to be 32 million barrels. we increase our exports incapacities. maybe not all of you heard where we are in the ranking. i just mentioned the refinery projects. there are four refineries open

for investment. we start building new ports. let me get to the conclusion. with all the potential i mentioned and other friends will mention it, i am sure you are familiar with it. put the iraq government and a commitment to look forward to leverage our oil wells to be in the benefit of the iraqi people. we understand there is a lot of challenges, especially when we have an emerging democracy. the good news is we have an

emerging institution to solve the problem. you have an institution -- our base and our reference. we as the iraqi tried to push and encourage our parliament to ratify the oral law. -- oil law. we also explore all the possibilities to balance between protecting the iraqi wealth and our iraqi interests with giving a decent, reasonable profitable deals with international companies,

especially companies who think long term and a strategic way and play a positive role for iraq. it looks like i have to stop. i will leave the rest of it to the question and answer. thank you for coming. [applause] >> gd afternoon. it is a pleasure to be here. thank you for organizing this. thank you for the invitation. i think this is the largest gathering of friends and acquaintances i have been in the same room with for a long time. it makes it almost fourth being back in washington. when case said, i would like you

to talk about oil and politics and iraq and you have 12 minutes, there are those who do not believe i can say anything in 12 minutes. but i will give it a go. it is a huge subject. i could simply say if you are ever looking for an example of a phrase coined by a former venezuelan ministry of energy and mines that describe oil as excremento de diablo, iraq would be a good example of how much it can ruin things. we had a role the called it the 3 million barrels a day rule, any time they reach that it would go to war with a neighbor. now they are doing it internally and not worrying about neighbors. some of that is somewhat comical, but that is also real. oil and politics and iraq have

been a volatile risk and remain a volatile risk. it is central to everything going on at the moment could enter the country. -- in the country. i want to focus on a few issues. they are big issues so i will cover them in a cursory fashion. they are important about thinking of oil and politics. one is federalism in the shape of the state. the other is an issue of how oil and national reconciliation are coming together. finally, the impact of dysfunctional government and politics. to show how destructive politics continues to be in terms of iraq will production and its future ambitions. also to make an important point

about the civility of the state and the extent will is threatening the big territorial fabric of the state at the moment. it is fair to say from my limited experience iraqi politics is probably more polarized now that -- sends any point since 2003. the country has been in a constant state of crisis. has been in a state of crisis since 2010. the elections were unresolved. the outcome was never really accepted by all of the parties. the deals that were struck after words and the deals that allowed a new government to be formed after nine months have not always been honored or adhered to. has not always been understood. part of that shows and illustrates how party politics, political differences, agenda

differences actually -- there has been a tendency to see it as a interplay of -- over time and has been proven that the time to pursue that policy creates more problems than less. but to the dispute going on and the battles that are going gone to this day in terms of the iraq politics shows a number of deeper issues that play. the most important and fundamental is a dispute over federalism. really a dispute between various parties and iraq over sovereignty the shape of the state. also in terms of revenue and oil and gas, management and licensing. it is not just an arab curred difference.

-- kurd different spirit is a matter of degrees in both communities. in the past as politics is played out, the different factions in communities has led to specific outcomes as opposed to them battling each other. the failure to reconcile what are radically different views about federalism, a view that the center should be powerful forces week and the political power in decision making power should actually be decentralized and to the provinces and the new regions. the failure to reconcile that and the failure to reconcile is -- reconcile has been the most destructive feature of iraq politics. it has led to ambiguity as opposed to any accommodation are resolution or compromise on that

key statutes of state, not least the constitution. the constitution is ambiguous because you could not agree on key outcomes. key laws have not been passed because of the differences over the shape of the state. revenue-sharing laws being foremost among them. there has been a mind set that you could get a hybrid carbon law it would be a capitalist to solve disputes and iraq it. the opposite is true. to get a bad law just like a bad constitution it can create more instability. a good hybrid carbon lot is going to be a solution and an accommodation to these political issues. it will not be a steppingstone to them. it is also important to remember these issues are existential political issues. both sides of the political date and -- to the political debate and battle. it has been important to have a

sunny independent state with a week baghdad, a divided remainder of baghdad for the kurds. someone said to me, iraq is a failed experiment. what are you trying to recreate it? that has encapsulated a haskurdish vision of iraqi politics better than anything else i have come across. but is also important for the prime minister and the wider arab community to have seen the dangers of federalization and the dangers of decentralization as threatening the division and territorial integrity of the country. make no mistake about it, this battle has gone on almost 10 years. it will continue to be a principal cause that could threaten to tear up the state. events over the last few months

have suggested a decline of interrelations with baghdad and fractures over these issues than at any time before. i think it is important to realize in terms of the dynamics of iraq, what is driving the sunni agenda is not a desire for self-determination. it is far more a response to frustration, a sense of marginal as asian by the government. it has an element of political ambition involved. some people linked with the

former regime. and regional even start changing views, not least the events in this area and those are influencing perceptions. if you really want to go to the cause and what drives the sunnis, it is the other great unsolved issue of iraq politics and that is national reconciliation. defined as who has the right to participate in the political circumstance and whether that is the outcome be full and complete. oil has been central to keeping this issue alive and ensuring it is not resolved. on the one hand it has made possible a central government and has funded a central government that has been able to wield its power and leverage to ensure the fraction takes place. also hot oil can be used to undermine the prime minister. how they can take away the prime

minister's strength is something that has clouded the view of some of his rivals. but it also is going to influence the outcome as you move forward. the sticks and carrots and the central government will use will be dependent on access to that revenue. there is an eye to oil and particular amount the sunnis to what they can get and how to negotiate the best deal. in terms of where the sunnis stand, aligning them directly with the kurds might be somewhat different. most of these things if you take them together create the third and last. i would like to focus on quickly, that is the issue of dysfunctional government and dysfunctional politics. along with the events in syria, i keep going back to how much different things. that is a talk on -- all on its

own. probably the most immediate driver for the events happening in the oil sector at this moment in time is the dysfunctional politics aspect. it is eroding the value in the south of the country and is prompting international oil companies to look elsewhere despite a whole host of risks associated with the kig itself. also the risk the companies are running threading their position in the south. it is fair to say only b [, shell, and maybe one or other companies remain commited to the central government. it is not guarantee that iog's will remain the commitment. imparted is because baghdad has done a bad shot at taking what was a good position, the great deal a caught commercially for the country and it got for the

whole of the country out of the better rounds and not being able to understand commercial drivers for ioc,s not understanding are being able to fix some of the operational infrastructure will revenue issues and financial bottlenecks. not really understanding at the end of the day no matter how big your resources and how much to give companies access, if that is not commercial, those companies are not doing the best thing for their shareholders and they are not improving their position on financial markets. it does not mean the companies will stay. it says stop. can i do my conclusions? the question is really in terms of what the charges mean, really to try to throw some ideas out there for debate afterwards. i think the first one in terms of what the charges add up to is

the progress on oil production, which has so far been extremely good is not guaranteed in the future and is not sustainable for a whole lot of reasons. where the ceiling is is even a bigger question. for those of us in the industry looking at this, the ceiling is not 12 billion barrels by 2016. is whether it will be 6 billion barrels a day or less than 3 million barrels a day is actually an open question and one that can go either way. certainly ioc could lead the south. that would test the investment environment and the production shuffle. some may go north and some may leave iraq altogether. crucially the thing that is going to happen i think is oral will continue to exacerbate the political crisis and keep it's a

vicious circle alive that encourages authority to areas -- authoritarian some. regional events are going to come in. i will leave you with this thought. iraq really is at a tipping point. it is always said -- it is often said. now it really is one. the country could go in a number of ways. not all of them happy ways. oil will be central to that in terms of how the play into federalism and reconciliation. [applause] >> thank you very much. thank you for inviting me here. it is always hard to follow raad. i want to focus on some of the

trends and relations that have the marriage between baghdad and the krg. with these applications have been for the oil sector. there are two. so would like to make in the brief time. israeli -- relations have deteriorated since 2011. these reactions that i will talk about on the ground among the iraqi arab populations. shifts in the geopolitical security and regional relations. despite to this crisis and how pessimistic we may be, i do not see the tensions leading to sustain our conflicts between baghdad. what is more likely is a continuation of the status quo,

a lot of inefficiencies, each side attempting to gain more leverage than the other and gaining from the positive externalities' of the revenues. this will mean there will not be a national hydrocarbon law signed in the near future. these temporary side deals trying to be negotiated at different points in time. how and why these relations have worsened and what really changed since 2007 when there were moments when baghdad and the krg for trying to negotiate. the first point is the three key issues -- i will not go into what raad talked about. this is about federalism and how power will be distributed. there are three key issues that remain the same between the krg and baghdad. article 140 the dispute of territories and the national hydrocarbons lot. the difference now since 2007

when the referendum did not occur, when the national hydrocarbon law did not get past, these issues have become entrenched. so any law that will be passed or negotiated in the future has now become an issue of negotiating disputed land as well as this budget issue. as much as contracts, payments, and auditing. this energy sector has become so politicized that this. that the failure to move it forward has that led to a reaction by the kurds. i do not know if you have seen that map of the 2003-2008 land claims that the krg has made, this is a significant swap of territory.

there has been again the militia and flags and these disputed territories leading to suspicion to reactions from baghdad and further entrenchment of positions. the second issue that has again exacerbated relations is the turkish k are g relationship and the geopolitical tensions that have emerged. this relationship that started to move in 2007 has negatively impacted baghdad krg relations. to benefit from the energy market has actually antagonized the central government and you are starting to hear statements that they are dealing with the kurdistan region as an entity. the political alliances and proxy wars. i cannot get into this. this is really important with the kurds and i will nuance this which is more the kdp, they have

further entrench the division's reflecting the risks between ankara and syria, iran, and the krg's role in assisting syria. this pkk is to end the syrian opposition. energy ambitions are breathing iraqi nationalism. i have spoken to iraqis what is going on the ground is contrary to any plans to create some grand sunni alliance. has not been able to consolidate. local populations in central iraq are reacting to their perceived maximalist ambitions.

what is the emerging alongside -- this is not just occurred arabic, but there is a growing anti kurd sentiment and a block outside of the circles. we are talking about the kurds overstepping their autonomy. this has all been to his benefit by trying to -- you know what has happened in the recent trips. sunni arabs are saying they may not like maliki, but we are against with the krg are diong even more. what is happening inside the kurdistan region. when we say the kurds in bagdhad, and there is a unified position. but there has been chipping away and increasing

polarization. we do not see this in the press. as we can say the puk influence has declined and has somewhat dissipated, you have seen a polarization of the two group's. this is becoming salient in a way that the krg has been dealing beenbagdhad. the trends that occurred in the 1990's, they are not even close to coming to a civil war. in the 1990's there was a turkish alliance and the smuggling made thepuk went to iran and it was a regional polarization occurred. these trends are occurring again as the puk did not want to support a vote of no-confidence. is turning to iran to assure border trade.

it is also to check a growing family power. there is a current supreme council that has been formed by the kurds that to negotiate with maliki and they are going down there right now. it is something that is a step forward. i must emphasize there are only puk members of the council. more approachable in baghdad. this is the same type of pattern that occurred. how does this again affect energy issues? even if the puk negotiates something because he has to, the more important issue is whether

they really do have some influence where the real power rests. that is where the hard-liners are. they did not have a great influence when he was prime minister. so you have to see again to what extent the supreme council will really be able to come back and get what they really need, which is an ongoing payment mechanism. we all know this has become increasingly personal between two favorites of hours who have not been very clear about their antagonism toward each other. you have seen at least in the public discourse a couple of years ago saying we recognize the only person who has the right to export six months ago -- they're saying the they have the right to export oil as well.

this shifts in the discourse. at the time to recognize who is a sovereign authority has also changed. why then should we not expect an extended crisis? this to me in my view is another issue of brinkmanship. if you look at the pattern of behavior, for the last 80 years this has not been a state -- there has been conflict and negotiation. at times posturing. this type of posturing will continue. even today the stakes are even greater. there are much higher for the kurdistan region. there is a lot of money involved. k are g does not have the leverage that it claims to have. it can bring in theseiocs.

the key issue remains, who is going to pay? aside from small sporadic payments to oil companies, there is a serious payment issue that makes sense what people need to get into acquisitions to help offset costs. unless some of these key issues can be negotiated again about payments, i do not see where the leverage is to threaten brother to negotiate with baghdad. when that will happen, i do not know. what i see for each side's benefit is to maintain political limbo. given these realities it is not just confiscation, it is not in either side's interest right now. they do not even need it.

they can get more sign on bonuses and baghdad can pump as much as it can because it cannot really afford to have greater capacity at this time. this status quo will probably continue into the at least short or medium term -- short are medium term. thank you. [applause] >> thank you so much for organizing this and allen and my distinguished panel colleagues. it is interesting remarks and a timely topic. to see so many people here, i am quite surprised. iraq is beset with political challenges, it always has been. two issues proven to be the most difficult and fraught with risk and uncertainty is the issue of iraq will and in particular the

politics of international investment in the oil sector which is of great interest to some people here. secondly and regrettably, the issue of foreign troops on iraq will. i was thinking of how to structure the topic of going back to the relationship between the two issues and how and why they are related. they have been the most controversial from the beginning of iraq's history. it goes all the way back to iraq's finding in 1920. oil goes back to when oil was first struck a denture 1927. this should go to the heart of iraqi nationalism and what it means to be an iraqi in the heart of the state. there are issues in which others -- outsiders are apart and. they are issues and which outsiders -- the british government, the u.s. government

and international oil companies are coming and negotiating and working with the rockies on issues that carry this deep historical backdrop. i thought i would try to draw some lessons as a practitioner of dealing with iraqis on difficult issues. i will call an audible and go right to the 2009 bid rounds. i will briefly talk about where we are on these issues which were raised in the panel. i want to say for lessons up front. they seem obvious but they are more honored -- there is no substitute in these areas for sustained engagement. that means daily, active, constant behind the scenes, it is not glamorous work, but every day talking to iraqis to try to get a view of the issue. the culture and the personalities. we a americans might see issues

in terms of mutual interest logic. these political realities have a lot more to do on the iraq logic. you come up with constant surprises and setbacks. relationships and council of ministers and the parliament's. you better have relationships with councils, with a civil society leaders, to understand what the popular sentiment is surrounding the issue. that is particularly important in iraq because they are responding to popular pressures. you just cannot ignore the popular pressures that bubble up on these issues. wherever possible have a pre negotiation to draw the line, expectations and gap to confront when dealing with these issues. be flexible and patient. there is no cookie cutter

approach. you cannot say we have done from the steps to force an agreement this way. you cannot say this is how we negotiate oil contracts with the saudis. in terms of patience, the status quo will always change. in 2007 or the fall, it really looked like we were trying to stop the break out of an all-out war. compare five years later it is extraordinary and five years later we will have to see where things stand. jumping to the 2009 brown's, june 30, 2009, what was happening in iraq, it was national sovereignty day. it was a day in which we truly

transitioned security control over to the iraqis. across the street at the hotel was also the first bid round. this was the first time international oil companies came back into iraq since it was nationalized to really bid for access to iraqi oil fields. provincial councils were opposed, the parliament was supposed, the k are g was opposed. almost everybody was opposed. if you read newspapers at the time, there was tremendous opposition to this. also the legacy of our own occupation. the hangover of why did the americans come -- that was deeply ingrained into the psyche of the iraqi consciousness. i do not think it was a coincidence this happened on the day that the international story was u.s. troops were leaving the

cities. the relationship between the success of the iraqi government's was increasingly front. the result was a massive class of expectations. it was also on national television and a rock. they are often 10 times higher than what the iraqis were willing to pay. there were gasps in the audience. this was seen from the outside as a major failure. from the inside as the iraqis saw it, it was a big success. it took care out of the nationalists bowline and groups ready to use this to take to the streets and tried to block foreign investment. it set the stage for pre negotiation and for a second bid

around. what you saw over the subsequent four months, the exxon at shell a deal and also the second to bid around in december was a huge success. i think 10 fields were up for a license. suddenly ioc was granted access. there was no backlash at all. the issue was taken after the political debates. i think it was quite extraordinary the way the iraqis and a back given the difficulty of the issue. fast forward to where we are today and the results can speak for themselves. the iraqis can see the fruits of what happened in 2009. the debate is not why are their national companies, but why not more. what are some going to the north. the last bid rounds are seen as a failure. i know he said it did not live

up to expectations. you need a new model contract. you need to make profits to be incentivize to get the oil out of the ground and not to international markets. that is very important. for the first time in history there is an emerging consensus -- these things are never lanier -- on the need for expertise to help iraq develop their oil sector. this was never a given given where we are today. brings of the fact we face extraordinary challenges. let me say where we are now. when it comes to hydrocarbons, there are three lines of effort. there are internal facilitation, that is focused on the baghdad peace. we can address that in the q and a's.

there is more energy in the area now than i think there ever has been with the joint coordinating committee. we are helping them on the model necking and trying to make sure they think of the system, not an ad hoc effort. and also a multilateral facilitation. working with the world bank has we focus on oil and also working with the iraqis to increasingly try to diversify their economy. more and more oil comes out of the ground in the international markets, the more they are approaching a risk of a first type economy. working with institutions like the extractive industries, trying to get with the problem of corruption and all these things. these are things where the united states can play an important facilitating role. i get into some details about

the disputes and where we see that playing out. with my time short i think there will close and say, these are extremely difficult and challenging issues. we in the united states and iraq bank share an interest in this area. we want to the oil sector to flourish nationwide and to be done until a responsible way in which the parties work together and come to the table. we are beginning to see that as the crisis eases a little bit. we have a ways to go. there is a lose-lose path and a win-win path. trying to focus the debates in the 2007 timeframe -- a devolved into this provision in the constitution and that provision in the constitution. but the basis of any, it is a

set of compromises. now we can focus the parties on the hard economic realities that iraq faces. the hard economic reality the baghdad faces. trying to get to the problem from that, hard numbers, hard facts. how are you going to get onto an international market from the bag that perspective, how will incentivize toc's fulfill their obligations. they are focusing on the hard economic realities and bring the parties to the table is a role the u.s. can play as a facilitating role. thank you. [applause] >> i would like to ask the first question because the focus has

been almost entirely on the consequences of oil politics internally to iraq that. i would like to ask, what is the rise mean for iraqi relations with iran? i will make that to who ever would like to take it. >> i think it is worth looking at -- you are asking two separate questions. one is the bilateral relationship with iran and one is an issue of iraq the's rise on the international oil markets. both follow a similar path, although i think the key aspects differ. in terms of the iraqi relationship you have already seen the element of tension that has brought into bilateral relations. the battle over the last two or

three years over who has the largest reserves and a constant recalculation of reserves, cryptically a look forward in terms of the view to the future that if you have renewed opec quotas they may be based on reserves, etc.. it is something that has been a source of tension between the two governments. and opec system at a level under iran. there were a parity when iraq was last targeted. iran did not want to see a rock band actually participate -- or not participate in the corpus system. in a short, the iranians are worried the iraqis will take market share. under present circumstances when iran crude exports are sanctioned, that concern is more

acute. it is also has put into a broader context of a strategic relationship between tehran and baghdad and the importance of that strategic relationship. i think some of to run's worries -- tehran's worries about wanting to keep their friends' clothes that remain. there is an issue of the rising of iraq within a opec context. there is a big battle between iraq and saudi arabia under which at what point iraq should have quotas. i think the test of the answer to your question will depend on circumstances in part and critically if you find yourself in a position where the markets are oversupplied where there is

the beginnings of a need to start to limit output, and at that. what iraq is going to be allowed itself to be subject to and how that impact relations with iran and the wide opec status. >> would anyone else like to commt? >> i will just say, if you read the papers the last two months, a rock's production has surpassed iran for the first time in decades. i think it is interesting, we see these statistics. i want to highlight the importance of this u.s. iraqi partnership. one reason exports have increased dramatically are the openings in the gulf. they have the capacity to export 900,000 barrels a day. because iraq has to think anymore system -- systemically, there are only able to use one

spm at a time. there is two open now. only one is usually open a day. that plan was put in place in 2007. it was an approach we made, general petraeus that said if you do not have an alternative export route given the problems with the a-bot and needs some serious work, you have a serious national security problem. we worked with the iraqis diligently every day which got this project going. now i think people take for granted -- that happen because of a lot of things we did together in the 2007 timeframe. a lot of americans are involved in that. it's a just shows how the

efforts can pay off. it can take five years. some things we need to get in place now. we are working with a it on the bottle backing, infrastructure protection might bear fruit and five years. these export figures are impressive, a positive thing for the iraqis and for us. they are the fruits of some things we did together with the iraqis. it is an example of what we can do when we thing together and work together. >> there is a microphone coming. please state your affiliation. >> when i think about iraq, i

think about oil as one o fthe factors in determining -- we have done a lot o fthings to help them export to the south through the gulf. would it have been wise to help them fix the strategic pipeline and help them export more to the north and west? >> the pipeline can carry -- please correct me if from the -- it can carry 1.8 billion barrels a day. 1.6 billion barrels a day. over a number of years we have talked to engineers who have said they can get up to 3 million barrels a day. that is the pipeline of course in which the kurds will run feeder lines into. also begs the question of why they might want to build an

independent pipeline. it gets into my. there is a win-win scenario that i think all parties will come to gravitate around. i think one of the fruits of the search and what i think that strategy was so necessary at the time was to ensure that you have some security around the pipelines and of the work done. just like we came to the iraqis in 2007 and said you face a national-security problem, they face a security problem given the uncertainties in the strait inhormuz. to make sure they are as effective as possible, i think it is right on the money and we are has to speak.

>> it is probably the biggest unknown i would say and the most illogical decision that the iraqis have taken. it is one that i asked on a number of occasions and have not gotten a good answer. there is a plan to build a strategic pipeline in place. why not fix the pumping stations that were bombed in -- 1991. rehabilitate that line. that is a huge question not least because -- i am a cynic. the cynical side to the answer about what has been achieved is when it comes to actually thinking about things in a systematic fashion and critically when looking at on a sure infrastructure, there are a huge set of bottlenecks that are part of the reason why i overseas are leaving the south am looking elsewhere. are leaving the south

and a looking elsewhere. it would suddenly opened up capacity of something in the region of 500,000 or six and a thousand barrels a day. it would shift the bottleneck a number of companies will tell you has limited the up side of their production capacity in the short time. it is also a question politically. if you can send another 600,000 barrels a day up through turkey and some of that being delivered to turkey is crude, there is a political and strategic rationale for it as well. the short answer is, it has been on the table. to reinforce -- i have seen plans since 2004.

originally it was thought of as project rio. it has been part of the overall thinking since 2003 and 2004. the iraqis have yet to see it as the simple quick fix that it is. >> with our plan to go up with the level that we understand, our ports in the south cannot handle it, that is part of our plan to look at it as our options which is going north and going west. we should also understand there is a regional stability. the political tensions between a rock band and the saudis deny

using that line. any potential projects going west through syria, jordan or the pipeline going through -- we are going in that direction the long term. it is not enough to export what we plan to export only from the south. >> another. to be made. there was actually some plans to continue and to expand the oil coming out of the northern pipeline. the last echoes out, the less baghdad has to pay.

they're down to 300,000 rainout. i do not think it was completely off -- there have been record -- efforts again to increase the amount of oil coming out of the pipeline from the very fact this agreement is still made it. when they talk about how we are going to build crude out, there could be some confusion here there is one discourse that there will be an independent pipeline. there is a more realistic one to refurbish the existing pipeline. that actually is what they're talking about right now. that is not completely off the table. >> back of the room please on the aisle. >> high. -- hi. we spoke about iranian influence. i wanted to address a question

-- what is your response to certain corners that perhaps iraq could be selling irani in a war on iran's behalf. >> i am not aware of that. we hear the opposite way. the minister of oil many times says smuggling from the north. going to iraq.

>> healthier students are better learners. the missing link in health education reform. and the next is the association between physical activity, physical education, and academic performance. these two books along with every professional development library because these zero have taken hundreds of studies and analyze them according to what benefit they have to academic success. and we have hundreds of studies that document that students learn better the more physical

activity they have a more time and intensity they have, the higher the test score and just be better student in general. they have better discipline, they are demonstrating less stress. there are so many benefits of physical education and physical activity that if people brought in, they are doing a total disservice to the field of education. >> i know part of your work is going to schools and promoting physical education and the type of curriculum. i am curious what kinds of conversations you're having and what challenges they are having. >> one of the major challenges that schools are facing is the fact that you have cut back of

physical education because they don't have gym anymore. they don't have recess either. over 40% of schools no longer have recess. i don't know if i could survive in school today because recess was the thing that i looked forward to that needed to my knowledge games like tag and the red rover, remember those? if you ask a kid today what they do at recess, like you have two heads. it is something that is really important for kids to be able to have that time to decompress. it is not just about structured physical activity and having physical education in the school, but recess and that time

provides them the ability to put together a growth and figure out and negotiate with one another, that we are missing. like sen said, the screen time has gone up astronomically. that doesn't include school time, but a wave. there are teaching could cut the lead because they have to learn how to play. they go to school and teach kids how to organize groups. how organized the game because they have lost the art of learning how to i know most of

us learned that at school on the playground. there are lots of schools that don't have playground's a more or they have green space areas to runaround. here it is a tremendous problem. >> going back to structures and vigorous curriculum that dr. meyer was espousing the benefits of earlier, i think that another reason other schools are not really taking gm class seriously is because so often it is seen as a free time. especially high school age, you're sitting on the bleachers talking to your girlfriend and not talking -- and not doing a whole lot there. what does it affect of physical education program like? and what sort of the aspect is that required?

>> i brought a trot. at the time, the division of adolescence school health even though they have reorganized. they have developed as a physical education curriculum analysis tool. this is excellent and every school needs this manual. it is on line. how do you assess it? how do you know what children need at what level? it explains -- is everything in here. they have done a nice job. i cannot say enough. there is training available. administrators need this. not just the teachers in the classroom was a program supervisor.

so many times administrators when they are observing teachers -- they are not sure what they should be observing. they do not know what is educational in the physical education curriculum. so there are people who let their programs slide because they know their administrator does not really know what is a quality program. >> we are talking about, here is what you have to do. could you give a specific example of what an administrator should look for? what is the education component? is it to be hyper competitive? >> just like in the curriculum, it should have learned outcome. they should be accessible. they should have planned lessons, sequential that are developmentally appropriate.

it -- the lessons should be tied to the outcomes. it should have all those components with in it. that is one thing to look for. the second is how is it delivered? what type of delivery is the instructor using? are the interactive or just lector? are they just going over what are the rules of things? this should be lifelong learning that the students are getting in their physical education curriculum. is to not be a lot of competitive sports. it should be skills base. how are we developing that child mentally, emotionally, socially, intellectually? -t's mr. jones, >> mr. jones, can you explain where you are doing at your school and to regard to physical education? can you hear him?

>> hello? does to piggyback on some of the comments here, one of the questions we had in public school was the fact that academically, we're pushing our kids to go for standards are always increasing. it seems a great idea that we know where our country is ranking among other countries around the world. we are in a panic zone to compete on all levels. with that, we have taken so much out of all of the other aspects of learning that i once had. learning, have a home economics class, learning how to cook, take care of home. gym class -- every year we sit down to decide who will get jim this year -- gym this year. it is unfortunate because

everyone can benefit from gym.' there are a number of things being stripped away from schools because we are in a panic mode to create a streamlined and individuals. where i am now, we decided to create a health and wellness environment where we wanted to focus on. we believe that a healthy person with activity -- i also remember the tv gone off. i felt bad that i was one of the few the remember that. but my students come to school with mp3 player, their telephone, something connected to their ears. if you cannot force them to let go, they will not let go. our focus was to force them to put those things down and interact because through those

interactions, a lot of the social skills start to bloom. kids become mature in a much faster rate whereas if you allow them to sit in a corner, they will adjust to an out the world. -- they will just tune out the world. we also included free time for our older kids. do not call a recess. you have free time. but we also engage them attended different activities during that time as well. our focus is to keep kids acted as much as we can, even within our lesson plan and our curriculum. our curriculum -- i encourage my teachers to make students move. it is very difficult to just learn in one spot. get up, go interact with the community, things to do. even if it is just a short walk around the block.

to engage in something just to keep the focus on. my focus is on movement. at all times. >> let me ask you something he was talking about. i am also share of our local advisory board. we have health councils within our school system. the teachers -- we are encouraging all the teachers, especially at elementary schools, to have activity breaks. we call them brain breaks to get the brain active. and to a carriage more efficient learning. the more active the brain is, the more they will be able to learn that much faster. and be able to get the learning. we are using that and encouraging it now in the middle and high school level. >> i wanted to touch on

something -- talking about community involvement in bringing these ideas into the home. for all of our efforts in schools, we do not want to have them reversed the second they go home and into their neighborhoods. i am curious what sorts of efforts you are making so schools can assure those efforts did not go to waste once school is over. how are you involving parents? are you getting pushed back from parents when he tries to implement these ideas about health, nutrition, a physical fitness back home? >> national wildlife federation has a program called ecoschools usa. the program promotes help the schools from the inside out. not just -- is about what kids

are eating, outdoor space, creating gardens were you can actually decide that you learn about vegetables. you can learn about vegetables and then put them on their plate and ada part of the curriculum. that is -- it also encourages parents to get involved and be at the school and really participate. kids when they get really excited about something, they cannot wait to share it with their parents. that is a way to bring parents in. to have these innovative things -- what did you have for lunch today? they can say i have pizza with portabello mushrooms. those of the types of things that we need more of because that will leak out into the

community. parents will have these really excited kids that they want to keep that excitement. you are not -- you are actually talking to me, you are not texting this across the table. >> when you talk about the national wildlife federation program and all these efforts, how do schools get on board with this? do they come to you? >> they can sign up. it is a voluntary program. you can either focus as a school on water quality, you can create a recycling program, you can create an outdoor garden. you can just sign up. >> nutrition, we talked about it and people may be not knowing how to cook. if you have parents who are on that level when the kids leave your kitchen -- are there ways

you are trying to bridge that gap? >> i wanted to talk about incorporating the community. asa to a program -- i also do a program. we do a lot of community based functions it because the community supports ccap. they give back to the community. my kids go and cook and talk about nutrition theory they do a lot of different things, go into other schools, work with kids. at the other end of the spectrum, i teach parents at my child care center. i have culinary class is for the parents. a lot of time the kids will go home and they will not eat the food the parents give them. they say i would like how the chef has a and then the parents come to me and they can give me the recipe. so i do parent classes. it is always based about

nutrition. have you can make a meal for your child. if you work during the day and you do not philip cooking and mcdonald's is an easier answer. but it is not. i teach them how to make healthy food and i do with a very diverse group of people. they all come -- to this cooking class and i asked them, the you have any suggestions for the next class? it is always fun. i teach them also how to cook with their children. in other times you not want to do with their kids cooking but they have a tendency to want to eat what they fix. they are part of that. so that is the initiative i use and then to my program at children's village. >> i think we all would like to have you in our school or life somewhere area that is very impressive what i like about the

panel is the way everybody is trying to do their parts around the objective. one of the things we have done cryresponse to mrs. obama's to get the private sector involved is to get the parents and consumers meet the right courses, to put a calorie label on the front of every can, bottle and pack. now you can look at the can -- it is very clear. this has 10 calories per serving. just another step to give parents, consumers, and permission to make the taurus is right for them -- to make the right choices for them.

>> it is sometimes tough for because they are working many jobs so they can put food on the table. we have been trying to do some things with educating them about going on line and looking at things from the national pta. they have a website that has loads of activities and ideas about activities that parents can do with their kids and how to get them involved. we have a wonderful -- when the kids are assessed, we have a mission is -- a nutritionist that goes into the home to help teach the parents how to cook with the kids need. there are programs out there that are doing wonderful jobs. >> i have a question that is

not supers pacific and terms of programming. we are talking about children especially in the wake of let's move, we often talk about it in the framework of a child of the obesity. there has been some push back around framing the discussion that way, particularly with kids. some think we're focusing too much on size, is suing issues of shame -- introducing issues a shame and body consciousness. onyou think focusing obesity is not the way to go? is it something to confront head on? how should we talk about these with kids soak it is not about something they are self- conscious about? >> they should be working on

this for every child. looking at how are you personally? helping to educate them about what their body should be able to do at what age level. and helping them to set their own personal goals. and how to reach those personal goals. if they have it -- a good program, it should be included. >> they should make it fun. this should be fun. we used to play in the bizarre activity. the first lady recently said it used to be called play. you wrote your bike in iran around with their friends. -- you rode your bike and you ran a round with your friends. there are schools that are on report cards. and they are doing that because

they say they are trying to do it in a way that will help schools and kids regulate their health. at the same time, do we really need that number on there? does the kids really need to know that right now? maybe as an adult, yes, of course. pay attention to it. but i think we need to make movement fund. we need to tell our kids to put down the the price. -- down the device. it is our responsibility to turn off the tv, have a green our were you say we are going to turn off the devices, turn off the computer, and we are going to go outside or just sit and have a conversation. face to face. not a device to device. focusing on the fun instead of the detriment would be the way to deliver the message of health

to kids. >> some of the questions -- it is hard in today's society with so much information and media being available to separate the conversation of obesity and size, thickness, things of that nature. one of the things i think we are overwhelmed with how much fitness information there is on television. or even online. but it is always a vision of some perfect person trying to get even more perfect. [laughter] the images that our kids see -- in the panel prior to us, there was a discussion of expectations and stereotypes and have to be fight those things and does have a conversation on health and

wellness? -- and just have a conversation on health and wellness? everytime i get on the airplane, i realize i need to get in the gym. i have those moments throughout the day. i think we force people to come to the realization that things in our society are not necessarily working on our behalf. just because there is a mcdonald's on every corner does not mean is the right thing to do all the time. there are a number of things -- the images we give to our young kids are not all positive images. b. schubert to control the things we're feeding our kids. -- we should work to control some of the things we are giving our kids. the health aspect of that -- it

is something we all deal with. i have my own challenges. as a part of what i do, i make sure every day before my kids leave, i change into my work and close to the no when they leave, i am going to work out. hopefully encourage someone to take that same type of activity. it is a holistic view we have to take culturally. how do we raise our kids in a generation where so much is available as a child, it was not an option to leave the house. if he stayed around, there was work to do. so we left the house because you did not want to do the work. whereas there is so much not to keep you glued to the television, a computer screen, or some type of device and sitting in a chair. it is the way we have to look at the society -- the way we have to look at, the society has to change. >> i think that healthy eating

is very important. you can work out, that as important as well. but if you work out and the five tips of bags afterwards, it kills the workout. we need to do healthy eating. i work with children as young as 18 months all the way to 12 years old. they are eating zucchini sticks and hummus at an early age. teach them how to eat healthy so by the time they get to high school, they have already been introduced to a lot of things they may not normally be introduced to. because i work with a diverse population, i am introducing them to different foods -- things like bok choy. i think the stars with healthy eating. -- it starts wtih healthy

eating. kids carry around a lot of baggage tripoli at bmi, come on. that is stressful. what do i do? i think we focus on healthy eating that held down the road for the boost to the -- for the obesity, we can cut that down. >> i want to open it up to auden's questions. -- up to audience questions. there are microphones going around. >> this is for the shaft. we do a lot of work with my organization with schools and school meals and the quality of the meals that are served. one of the things we have run into with some of the other food service workers is they say i

understand the mills are changing or i have to put out this but then i have kids asking questions, why are my carrots mix with my peas or why did you switch this? sometimes they do not understand how to answer those questions. what suggestions do you have to educate others about how they can be part of -- proud of the food they are putting out, even the ones they may not have the ability to prepare fresh. >> when i cook, i also have to cook for vegetarian children. and gluten-free children. i have a lot of different types of food allergies. so the question, why does this look like this or that? you have to explain to children sometimes, it is fresh. it is not frozen.