protests, rallies. both of the convention cities ha been very concerned about that. it is a fine line between allowing people to openly protest but it is not an easy thing to juggle. we could see some problems in both cities with that. it could cause some negative feelings coming out of both conventions. that is always a thing we have to walk. >> sean lengell, ginger gibson, thank you so much. >> every four years the republican national convention adopted a national platform, an official statement on the

position of a variety of issues. our live coverage begins tomorrow at 1:30 p.m. eastern from tampa, florida. watch "newsmakers" with marsha blackburn today on c-span. but americans for tax reform talked last week about the u.s. tax system and how it applies abroad and is implement on u.s. foreign policy. he also commented on paul ryan as the vice-presidential candidates. this is 1.5 hours. >> ok. folks, ladies and gentlemen, i think we are ready to begin. i am the editor of the national interest magazine. i am delighted to have all of you here. welcome.

i am particularly delighted to have grover norquist here. grover is one of those people about whom is often said in these kinds of settings, he needs no introduction, but i am going to give him one anyway, because he is too interesting not to. he is a massachusetts native, harvard b.a. and mba. he quickly gravitated to the district of columbia, where he has significant position to the u.s. taxpayers association. he is the author of a recent book, "debacle." in 1985, he founded americans for tax reform, whose aim was to reduce government receipts as a

percentage of gdp. he believes in a smaller government. he believes in getting a handle on the debt overhang, which i believe is the most serious problem facing the country today. his most famous for the famous pledge, getting members of congress and other politicians to promise not to vote for any increase in marginal tax rates for either individuals or businesses and not to vote for any net reductions in credits unless there is a commensurate reduction in rates. as of late last year, 238, i am told on google, of 242 house republicans had signed this pledge and 47 senate republicans. this drives democrats and liberals crazy. he has been lauded and attacked

for it. john stossel lauds him -- "no one in modern times has fought harder to shrink the state than the founder of the group americans for tax reform." arianna huffington has a bit of a different view. she calls him "the dark wizard of the right's anti-tax cult." p.j. said, "grover norquist is tom paine crossed with lee atwater, plus a soupcon of madame defarge." i pondered that. since in our species you can really only be the cross of a male and female, i found myself reminded of what mark shields once said about his good friend bob novak, the late columnist, when he said "bob novak is proof positive that calvin coolidge and -- were more than just friends."

grover takes a rapier to his opponents. he takes no prisoners. at the same time, he is always very pleasant. he never raises his voice. it is always in mellifluous tones and has a lilt to it. it occurred to me that maybe richard nixon hooked up with doris day. >> thank you for the unique introduction. and, i think, generous. i have been asked to talk about economic and foreign-policy, domestic policy, and how they interact. are two ways in which they interact.

there is the reality of economic policy and whether it works or not. and since we are talking about politics, you can win or lose an election on one set of issues, even though you think you're focusing on another set of issues. foreign policy and economic policy play out in a campaign, but they also play out in government. obviously, economics matter. the united states is the preeminent world power and has been for some time because of its economic policies. it has a more free and more open society than other countries and it creates more wealth and allows more people to accomplish great things. more so than other countries do, less than we should, less than we will in the future. but we're competing with the alternatives, not with utopia. we were a world power back

before we even had much of a military to play with because of our economic growth. you go back to before the american revolution. we were taxed between 1% and 2% of gdp in the colonies. people in britain were paying 20% of their income to fund the british empire. empires are expensive. people do not appreciate having to pay for that. they wanted us to help pay for the british empire. we said, thank you, we will pass. rather than run an empire, we ran our rather large commercial republic, which became very powerful. when you have all that lovely money, you can buy things that go boom at great distances on your own. it matters that we have a large economy.

it makes it possible for us to have a national defense spending 3% or 4% of gdp that dominates the globe. we spend more than the next 13 countries added together, he says, understating his case as always. we do so with a much smaller fraction of the wealth and income of the american people. foreign policy also affects domestic policy. you go back and look at the last two administrations. bush, who got elected on his domestic platform, decided after 9/11 to focus on foreign policy. as a result, there were opportunity costs. the opportunity costs on your foreign policy is that you take a dollar that you're going to spend on welfare and spend it instead buying a gun. the more important opportunity cost -- that is not unimportant when you're dealing with hundreds of billions of dollars. the more important opportunity cost as the band width of the presidency, a congress, a white house, and bush decided to be the mayor of baghdad rather than

the president of the united states. he decided to occupy iraq and afghanistan, rather than reform fannie mae and freddie mac. that had tremendous consequences. time, the president's bully pulpit, the president's attention. the president could go and demand certain things from congress. if you have made all your asks about occupying iraq and afghanistan for a decade, rather than reforming fannie and freddie -- they will tell you they sent several letters to capitol hill and ask them to fix the problem. that is not the same thing. it does not fit the magnitude of the threat and the problem that was seeable and knowable for the eight years of the presidency. a focus on foreign-policy as a consequence for domestic policy. we did kabul.

we lost the opportunity to either expand free-trade during those eight years. that was in terms of our requests -- we could have had all the europeans gang up on france and beat them senseless and get a free trade agreement that made the french farmers not get the subsidies they have been used to. instead, we have all of europe beating up on us because of our foreign policy. we could have focused on immigration reform. very important in the united states economy and to us -- us being us. instead, time and effort was put into iraq and afghanistan. when you talk about how foreign policy affects domestic policy, in theory, you could run foreign-policy -- aggressive

foreign policy and an aggressive domestic policy. but try and get the president, a white house to be able to have that kind of bandwidth when they deal with congress and when they speak to the american people about what they are trying to accomplish. looking for -- go back to reagan. reagan was able to manage the collapse of the soviet union while -- and i would argue this is not a paradox -- because he focused on getting the american economy turned around, taking double-digit inflation down to almost zero, 20% interest rates. if we had reagan's growth rate during this recovery -- there are lots of handouts i want to share. it is important to have lots of handouts. ever since trees ran into sonny bono. you can see the past several years of recovery have been

very weak. we have been in recovery technically since july of 2009. if we had reagan's rate of economic growth, reagan's rate of job creation, it would have many millions more americans working today. gdp would be about 10% higher than it is. this is a disaster. it limits american leadership in the world. one of the reasons other countries look up to us is our strong economy. and when it appears to be lagging -- we are looking ok. how is your wife compared to what? how is the american economy compared to europe? we are not so bad. compared to the trend line of where we were and where we could be, where a normal recovery would have taken us today, we are in very bad shape, much weaker than we could be. reagan focused on getting

economic growth and job creation, and that sense that he was always focused -- he had one hand out here, holding the soviet union at bay, whacking at grenada, but he was always focused on us and domestic policies, explaining to the american people he was focused on their concerns about keeping the bear at the door. the alternative is to walk outside and spend all your time arguing with the bear and convince people you are focused on what is important to them. since we have elections every two years, there is a cost to that. republicans lost in 2006 not because the economy was a problem. the independents were unhappy with the occupation of iraq and afghanistan. not necessarily knocking off saddam hussein. but staying for 10 years

afterwards. the voting switched from 60%/40% to democrats. on foreign-policy issues, the economy doing well going into that election -- moving forward, where do we go from here? i would argue that our tax policy -- we're going to have a big election. we will get into this more with questions and answers. paul ryan's choice as vice president clarifies that the directions. budget, in the ryan road map, as endorsed by the modern republican party. tax policy -- i would argue this affects both our hard power

and our soft power. on the soft power, we have 3 million americans, 4 million americans living overseas. every one of them, as they tell you when you travel to some european country or around the world -- you are an ambassador for the united states. do not annoy people. people meet you. they get a sense of what the united states is like. this is particularly true outside a paris or london. countries and cities that do not see a lot of americans. there could be a lot more americans overseas representing the united states on a one-on- one basis, a sort of ugly american novel of being a good representative of the united states, except our tax policy makes this difficult to

impossible. we have, in the united states, not a territorial tax policy, which the rest of the world does. we have a worldwide tax policy. france -- if you live in france and you are french, you earn money, the government steals some of it. here, the united states government steals some of it. when you go back to france, they do not take any more of it. the bite at the american government took out of your income is all that is taken out. in the united states, if you are an american and you go work in another country, that country will tax you because you earned the money there. but you come back to the united states and the united states will top off whatever the other country failed to take from you to where it is at 35% or, under obama, 43%-plus of your income. americans living overseas are taxed more heavily than other countries' citizens when they were overseas.

that is particularly problematic when you're working in countries that have little or no income tax. hiring a german to work in saudi arabia is less expensive than hiring an american. reagan lowered marginal tax rates from a top rate of 70% to a rate of 28%. the economy boomed. the rest of the world looked at that and said, we want to do that. you saw the european countries come in with flat income-tax rates. not only does it think it difficult to hire an american, it is less expensive to hire somebody from another country to work in saudi arabia or brazil or around the globe, but

american companies are at a disadvantage. i bring this up because the paul ryan plan is not only entitlement reform, welfare reform, plus tax reform. the outline that he has generated, the top rate of 25% corporate and individual, and territorial tax system -- within that, revenue neutral. the territorial tax is very important to america's foreign policy, not just domestic and economic policy. an american company overseas earns $1. the local government taxes some or not. when you bring the $1 back, the federal government takes 35% of it.

if you do not bring it back, you want to leave it in china or brazil or germany, you can -- there is no additional tax to leave it there. we have more than $1 trillion overseas. when you talk to the corporate guys who have been trying to get obama for the last 3 1/2 years to go to territoriality or allow repatriation of that money without a big tax hit, some say it is between $500 billion and $800 billion that would come back in the same year. it does not cost anybody anything. we just have to get rid of our worldwide tax system. the reason anheuser-busch was bought by a european company, it is more valuable if it is owned by a european company than an american company because of the way we tax earnings and other countries do not. if we did not fix this, other

companies will start being bought more and more by foreign companies. the economics just makes sense. we can fix that by taking our rates down 25%. and by going to a territorial tax system. i think these are extremely important. another challenge that europe has is the defined-benefit government pensions, the social- welfare pensions, the unionized pensions for the private sector, and there defined benefits. it means you constantly -- defined benefit requires a whole bunch of new people coming in and paying pensions to support the old guys. there are more united mine workers retire than working. it is an extremely heavy load for the industry.

the coal industry, the automobile industry, all of these industries are badly damaged. people have gotten most out of wack in the public secto unions. we have begun to reform this in the united states. one of the reasons i am optimistic is not just because i believe that romney and ryan are going to win the next election and have a republican senate and house -- i think that will happen. i think that is very important. the good news is also when you look at the 50 laboratories of democracy, there are 24 states that have republican governors, republican legislatures. there are 11 states that have 11 democratic governors and legislators. we have a real opportunity to see what works. california, illinois, maryland, and new york are busy working on becoming -- and the red states

are trying to reform reduced taxes. we had overwhelming elections in kansas where the winners were committed to the governor's vision to abolish the state income tax. north carolina is about to elect a governor committed to abolishing the state income tax. oklahoma has made the same commitment with their government and other states are moving in that direction. in utah, the government there a year ago -- all new hires -- state, local, county, teachers, they will have a defined contribution pension. which means here is your pay, here is 10% of their pay and a 401k. 12% if you are a fireman or policemen. that is the model that louisiana has begun to move to,

kansas will be moving to. other states -- north dakota will do it shortly as well as wyoming. moving state-by-state to reform the pension system allows us to also look at how we can do this at the national level. private sector has been doing this for 20 years now. shifting from a defined benefit plans to contribution plans. i think we miss the challenge your past. not only because our demographics are better -- we are having more kids, more open to immigration as opposed to the europeans. and we can -- this buys us the time to reform our pension system so we do not bankrupt ourselves with the entitlements. the big reform that ryan has put forward the us three things -- tax reform brings the rates down, makes us more competitive on the corporate and individual level. territoriality which stops disadvantaging american

corporations around the globe. american companies are ambassadors for america. it is much better to do the one on one conversations. so those reforms are key in part of ryan and will happen with the republican house senate and presidency. it will not happen if obama is reelected or the democrats have the senate. they did not do any of those things. they moved in the opposite direction on all of them, including territoriality which is why some of high-tech corporate world is so irritated at obama with a had a lot of hopes for. the other twpieces are beginning to reform entitlements. the model we have is working at

the state level. people are doing this and winning elections. not losing elections. which is always the key thing that politicians want to know. is this safe? can i do this and get reelected? and is it good for the economy and everything else? it always has to assure politicians that this is safe to walk out on the ice with. then the other one is the block ranting of all the welfare programs. clinton reform welfare, the bill in 1996 but block granted aid to families of dependent children. here is your money, a fixed amount, but you have a lot less strings. each state could decide how to get people out of welfare dependency and focus on people with real needs so that people with real need for taking care of and other people were not locked into welfare.

there is somewhere between 77 and more than 100 means tested programs at the federal level. the big ones -- medicaid, housing programs, job training programs, and food stamps but then there are a bunch of others as well. lyon and that approach looks to block grant. when you hear critics of ryan say you're cutting aid to the poor, they're plagiarizing the criticism of clinton's welfare reform. everything the left said about clinton's welfare reform turned out not to be true and everything they are saying about ryan is not true for the same reasons. it is doing for other welfare programs what clinton did. they signed the welfare reform bill and it worked. they did everything its critics said it would not. i think these reforms here will help strengthen the american economy and we can afford to

have an adequate national defense which keeps us free and safe and would make anyone afraid to throw a punch at best. as long as we do not make some of the decisions that previous administrations have which is to overextend ourself overseas and to run the government -- we are not very good at making americans organize their lives in the way somebody in washington thinks they should. why did the same people think they can do this in baghdad with success? it has not worked well there. let me take some questions here. the two feet off each other. a strong and healthy american economy with reasonable laws that we do not allow the billionaire trial lawyers -- where we do not have

overregulation, we will have tax is damaging this domestically. but also internationally. it makes it difficult for american companies to work overseas, for americans to be hired by companies overseas. and when you lose that, you lose some of the best ambassadors for who and what america is. strong economic growth allows national defense to be a smaller percentage of a larger economy and we can dwarf any with the enemy of the united states by having a stronger economy more quickly that we can by raising taxes here. if you grow the economy 1% faster than expected for a decade, the federal government and of the $2.80 trillion in higher tax revenue. what more revenue, you want to fund that national defense and the state department, reduce

marginal tax rates. deregulate, take that trial lawyers and took them down the pacific. do all the things that the great the american economy and move us forward. revenues flow in from strong growth better than if you try and take people down and pick their pockets. questions, arguments? >> wonderful. thank you very much. i am struck as i look at the history of the cold war and since that america's most powerful time were those times when we were most help the economically and vice versa. in the early cold war in the truman and eisenhower administrations, we held the soviets in check. we were also in the 1980's and

90's during and after the reagan performance, we were able to bring about the end of the cold war. we were least powerful during that entire history when we had economic difficulties of the late 1970's. with soviet adventurism on the rise of the places like afghanistan and central america and africa. this is related in little bit too grover norquist's point about domestic politics and reagan. i wrote down a few things. reelectionagan's year, the economy grew by 6.2%. that is the current percentage our current president could use. in the second term, the average growth rate was 3.4% and as soon as he managed to get the country through that recession

which was an induced recession to squeeze inflation out of the economy, the growth rate per year on average was 3.89%. reagan takes a big key on the deficits which is what it -- take a big hit on the deficits which is a legitimate hit. in 1987, he had a 5.8% gdp. by 1987, it was 3.61%. in his last budget, it was 2.8%. that is a manageable level. then under george w. bush, it went back up to 5.8% in 1992. growth has a big impact on the deficit an economy.

you talked about ryan's plan but a lot of critics of that plan suggest that those numbers do not add up. that the tax cuts are going to be devastating to the deficit and that the cuts in the entitlements and other places will be devastating for the economy. what is your answer to that? >> the key number to look at in terms of the cost of government is total government spending plus the regulatory burden. set the regulatory burden aside because that is largely driven by the executive branch implementing but at the spending level, the cost of government -- the government

spends $100 and it takes $90 in taxes and borrow $10. what problem have you solved by taking the other $10? in the other case, all $100 is taken. it is gone from the private sector. the cost to government in that case is $100. some was borrowed, some was taken or always taken. this is one of the challenges we get into when people focus on the deficit rather than total government spending. that is where reagan was trying to focus on reducing the total sites of government. one of the ways you can reduce that is -- as percentage of the economy. our government would be bigger. but as a percentage of the

economy, you want your government to be a smaller percentage of gdp. the thing to focus on, this is what ryan focuses on, not only does the cost curve on spending start to fall as a percentage of gdp because the economy is growing and we're spending less through washington. but eventually it ends up paying off the national debt because the reforms are so key. you can reform entitlements to save a lot of money. and you save a lot more than my cutting a particular program. we reform welfare by putting it out to the states and allow the state to handle it. the state -- the federal government's a great deal of money. it did not keep increasing the welfare payments and get the state's office state money because they were spending less than they used to have to and spending it smarter. those people who say the ryan

plan cut aid to the poor in 1996 need to say why they will be right this time. the ryan plan brings down spending and brings down the deficit. the obama plan -- if ryan has plans written down, you have simpson bowles, an essay in haiku. the want to take taxes from 18.5% gdp to 21%. they are very clear about that. everything else is on the fuzzy side. simpson bowles is over the next decade -- we expect $2 trillion in gdp.

so they will increase the tax burden on the american people from what it would be, never mind obama's $5 trillion in increases but an additional $5 trillion under simpson bowles. the spending restraint discussed at this point -- simpson bowles is not real. the democrats in the senate have not voted for any of this stuff. they have not put it in their budgets. obama does not put any of simpson bowles spending cuts in his budget. so there is no interest in the spending cut part. they like the $5 trillion in a tax increase. i would argue that ryan has already had his moment. reagan was -- his meeting with gorbachev. his empire was imploding and he

wanted us to make these concessions and reagan walked away from what the entire washington establishment said was a great deal. they love the idea of the deal. reagan walked out and took all the criticisms for having walked away. ryan blew up the simpson bowles phony deal. a massive tax increase little or no spending cuts. that is before it gets to the democrats in the senate. ryan is old enough to have lived through the 1982 budget deal where reagan was promised $3 of spending cuts for every dollar of tax increase. the tax increases were real, permanent. we are still paying them. spending went up after the reagan budget deal. then you had the 1990 deal with george bush who was in the bush

reagan administration and watched reagan get taken on the 3 to 1 deal walked into the room and said we have a deal for you. we will give you $2 of imaginary spending cuts for every dollar of tax increases. i think that is a bit insulting to the democrats. as long as you are lying to the guy, offered 10 to 1. and of course you did not get 2 to 1. simpson bowles is the third iteration of 1982 and 1990. discussions about the possibility of someday cutting spending. it would have ended the same way. ryan would have been a hero for the washington post and time magazine. he would sign a deal and find the republicans up for that disaster.

instead he stepped out and said i know everybody in washington thinks this is a good deal. ryan has been in washington, not of it. you are going to fight against the other team, you have to live and in washington from time to time but you do not have to become of it and you do not have to be scared of the washington establishment. he walked away from a very bad deal. because a much better deal with no tax increase as a result. his leadership encouraged on that fight. >> if you want to ask grover a question, kept my eye. -- catch my eye. >> i was listening to c-span on my drive this morning and the caller said paul ryan was a puppet of grover norquist. [laughter] i was a little surprised by this. he referred to an adequate

defense budget. it seems that -- if paul ryan was a puppet or even a strong accolade of grover norquist, he would be serious about cutting military spending as well as other spending and he is not. how would you respond to that? >> i would argue that he did not ask everybody to do everything. ryan has designed a budget approach with three things that 66 of the clinton plan and moves it forward on others. you now have the division in the democratic party between the old clinton people and the traditional liberals and a hard left. obama's guys want to smash reform. they do not want it expanded to other government programs. he has that, he has tax reform, he is looking at in tandem reform. bipartisan entitlement reform.

other people need to lead the argument on how can conservatives lead a fight to have a serious national defense that defends the united states from any potential aggressor without wasting money. i work with a group called right on crime. domestically. it is conservative folks who are focused on -- they say we are incarcerating too many people for too long. it does not make sense. we are not stopping crime in with all this additional spending. we are hiring more democratic union members and is that a wise way to spend taxpayer dollars? but only a conservative can come to the table and talk about how long should bad guys be in

prison for? the good news is that the first reforms were done in texas. at the same reforms were done by liberal and in vermont, they could not travel. nobody would go. they did this in vermont. but when you have prosecutors and police and people who are serious about personal responsibility and keeping bad guys in prison and stopping crime and punishing crime -- say are responding too much too little? you have a similar discussion that needs to take place on national defense. how do we spend money wisely? you had dick army who did this with his base closing legislation. it helped our national defense but it was difficult to do because bases were put in different congressional districts just as some of the contracts for weapons systems are also allocated by

congressional district rather than by talent and confidence. that is an entirely long -- a huge, important project. we should be very careful. the government should do this things mentioned in the constitution. with the possible exception of the post office. and probably not things that are mentioned in the constitution. if you take government seriously, we want the bits that should be there then confidently. that includes the defense budget. i would not ask ryan to be the reformer of the defense establishment on top of that. >> please identify yourself before asking your question. >> thank you for coming. i have a question to purpose into three observations. i'm a radical eccentric. as it on the board of a number of financial companies. and regulatory reform is overdue.

you mentioned mitt romney three times. my question is this. obviously we need entitlement and regulatory reform. you are not going to get 60 seats in the senate. how you do it? >> my own view -- paul ryan loses the election to mitt romney. obama and wins by eight points. set the because i am not an obama fan. >> let me cheer you up. i grew up in massachusetts. the left post a reaction to ryan is very interesting. they are basically tired. there plagiarizing everything

the democrats said about reagan when he won the nomination in 1980. are we glad to run against the guy who wants to cut spending and cut taxes and confront the soviet union? their understanding of where the country was is not with the country is. looking at it -- if you live and in chicago, you do not have an understanding of what the united states is thinking about in a given time. i would argue he is more ideologically rigid and learns less. his economic policies -- equally challenging. the second part is the argument that the republicans have written down the rhine plan. now we can attack. the democrats always attack the republicans ever since the 1940's with wanting to undo social security and later medicare.

they always say that when bush ran in 2000 and 2004 with a plan to privatize social security for people under 55 -- if you are under 55, will give you the option of a 401k. the democrats said this would have us win the election. that was one of the few elections where social security was a winner for republicans. we did not let the democrats care the old people when they yelled social security. they made it clear they were not changing it to 55 and over. every time, the castoff 20, 30, 40, 50 year olds who understand they will never get what was promised. when you rate something down, you make it more difficult for the other team to lie about your position. the democrats will attack his reforms on medicare.

the only thing obama has done to medicare is promise to take $700 billion away from it to pay for obamacare. and he has had no reforms that will help. he added an entitlement that does not pay for itself and costs twice what they said it was going to cost. by writing down the ryan plan which is reasonable bipartisan reforms on medicare and bill clinton pulls of reform to the poor, let the democrats attack bill clinton 's successful legacy. and make that case if they want. that is the civil war in the democratic party that we should encourage to continue. i am very optimistic that by writing down the ryan plan, the other team seems to have a better target. >> let's say that mitt romney wins.

have you get tax reform? >> you can repeal obamacare with 50 votes. it does not require 60 votes. you might have an argument on a couple of the policy things but with the right parliamentarian, those are completely solvable as well. most of ryan's tax cuts can be done with 51 votes. you can do them inside of it in your window. these are the guys who redistricted the country. in california and illinois, they redistricted. others have redistricted to elect more traditional.

these state legislative lines, the red states redistricted to stay red. but the rest of it stays pretty much the same for the next decade. on the back of that is the chart. 23 democrats in the senate, 10 republicans. half the deeds are doable. you are about to the republicans in maine and massachusetts. scott is running an extremely hard left against him. elizabeth warren, who has a lot of problems. that is a tough sell there.

we will have the senate next year. the senate election cycles are so advantageous for the republicans because these are the people who are elected in 2006 and 2008. only the republicans who were really tough one and a lot of democrats got swept into vote against bush. some of us and did not understand what bush and karl rove were doing but now we can cleverly see, they were sneaking up behind the democrats to take them all back. we will get the senate this time around. we will get close to 60 in 2014. in the presidential election, our president is not going anywhere near 50%.

he will not get -- the guys who are undecided will not be voting for him garrett -- for him. >> i would like to debate what you said of my question is, let's assume we do dumb things and go to a dull more like a record something. should we ask the american people to pay more taxes so they will feel part of it and maybe ask for questions? >> i think to avoid stupid things. >> i know, but bush did not. that is my point. >> there are two things -- one, there are ways to reduce those cuts now moving forward. and if you have a a government program of any kind that is not working or that is counterproductive or is lot -- is worth less than the money you are extracting by force for

the american people to pay for, you should stop doing that. since we have been doing all of these somethings, it is like a ship that collects barnacles. you get rid of the barnacles over time. you go back and say what works, what does not? let's reform these issues. i am in favor of reforming government to cost less, not cutting it. some stuff government does it is useful. tough to find in between all the stuff that is that useful but there are important things and you want those fully funded and then confidently and transparently to rebut that you also want to stop doing those things that are not working well. i am not in favor of raising taxes to pay for mistakes of any kind. >> center for immigration. you were talking about

efficiently running for policy and avoiding waste. that is not really the issue. the issue is what are the objectives that we want in foreign policy? we smashed the nazis and the japanese with massive inefficiency. what is the goal, what are the foreign policy goals? i think you are capering over a difference among conservatives. i agree with what i think you're for policy is which is frankly, let's not invade whatever the country du jour we are supposed the takeover. >> if the president cannot pronounce it, you cannot blow it up. >> mali is easy to pronounce. my point is that my sense of what you're saying is that even if we undertake the tax in the reforms that i agree with you

are essential, we are going to be under fiscal constraint for a long time into the future. what i want you to actually say is that those constraints are going to force us to not do what mitt romney and paul ryan have said they wanted to do with our policy. the way they have articulated their foreign policy goals is very expensive. not really in any sense like what bush campaigned on. a more limited, modest foreign policy. my senses we are going to be stuck with that no matter what it because of our economic constraints and is that a positive outcome from your perspective of all the problems we have been dealing with?

>> whenever you meet any foe, the first thing you need to do is cut the capital gains tax. [laughter] from there, there are different approaches. i would argue -- you need to decide what your real defense needs are. that does that mean chairman of certain committees get to build bases in their states. that is not a defense needs. that is a political desire but we need to figure out what do we need to do to protect the united states. how do we keep the canadian on their side of the border guard to mark an otherwise make sure the united states is secure? what is that? what does it cost? there are questions about how to less expensively by things if you are the pentagon?

have you make that economically efficient? it is not like going to walmart. so there are a lot of challenges government have is a meeting has been a buy stock. because there is not a market for it in other places. i with a start with what we do come to a decision on that. your question on foreign policy -- presidents have a lot of leeway on foreign-policy compared to other issues. there is no nra on general form policy. there is no americans for tax reform which has asked politely and consistently and repeatedly for people to make a written commitment to voters. the reason why the pledge has been useful and important is that i ask all candidates for the federal office and state office tuesday -- sign a pledge to their voters. harry reid seems to get this

wrong. they make that commitment as a way to let voters know where they stand. they do not oppose taxes because they signed the pledge. a sign the pledge because they oppose tax increases. those are -- both republicans who do not support and tax increases, do not sign the pledge. sandoval said repeatedly he would not raise taxes. when asked that it would put that in writing, they would say i am offended you would question my character. then they got in, the bulls past -- they both passed massive tax increases. they lied their way into office present a loss of one not raise

your taxes but i will not put it in writing. the first time he had a pickup, he raised taxes. the pledge is there for those who know the want to raise taxes. the politicians who signed the pledge do so because they want to leave the door open. that is okay. they have to run being honest about that. >> you still danced around the issue. buying b52s cheaply is not the point. how you define the objective? what does security mean? much of our foreign policy elite, security means we need to have democracy in burkina faso before any american is safe. that is baloney. my sense is your try to be too

polite and a team player to point out that in mitt romney and everybody else other than paul -- have the same take on ruling the world. you will not get what you want until that is addressed frankly and directly by people on the right like you. >> i think you do need to have that kind of conversation. i engaged in that earlier when i said we do need to have a conversation about what our goals in afghanistan are and what is winning. what are we trying to do? how long are we staying? the answer to those questions are ridiculous? we need to have these conversations with in the modern conservative movement because the guys on the left have forfeited their capacity to argue that they have something to say here.

so it has to be a conversation. chris is going to be managing this and you can be his co- chairman of the committee. >> [inaudible] the point about the one contingency everyone is talking about -- the war with iran -- does it seem looking at the statement that mitt romney is even more willing to go to war with iran than obama? if there is a war with iran, no one knows how much it will cost but it will be a lot more than a few million dollars. at what point under those circumstances are you prepared to admit something will have to

be done to either stop the war or pay for it with taxes? >> the argument that had been put forward -- the former head of the cia explaining that even a piece that there and shelled them for a month, we would convince them the actual -- they absolutely had to have a nuclear weapon. i am not a defense expert. this would not get what you want it to do. they are shelling them and they will sit there going for a month if we had some nuclear weapons, they would not do it. but when we get tired of that, they get back up. it the government comes in and

decide to focus on a particular war or occupation down the road, you lose the bandwidth to do other things. that is what happened to the bush and administration. it focused on iraq and afghanistan and not fannie and freddie. that was expensive for the american economy, and expensive for the world, and expensive for our world leadership. i am not sure it made us stronger in a hard power military sense as chart -- and not strong as a soft power military sense. >> can i ask a follow-up? i think the question and answer sort of fit but he was saying if we got into our war with iran, what would we have to do in terms of economic policy? your answer was we should i get

into war with iran because it does not make any sense. i happen to agree with both of those things but -- there are no numbers on the curve. because of laughter and all those people from the supply side were saying that in different times, the optimal tax rate is at different levels depending on what the needs are. they all said that in times of war, the country is more prepared to pay more taxes because of that response ability and therefore you cannot reach that point of diminishing returns. could you respond to that? >> i read the curve differently. there are two ways to get the same amount of money. want to decide how much she wanted to stock by force, there are two ways to do it. you can tax it at 90% and take a lot of the small economy or

text the 10% and it allowed the money with a small tax burden for much larger economy. at any given point when you decide how much money the government decides it is going to take, there are two ways to get there -- with a high tax burden, and no tax burden. what changes is the denominator. i'm not kidding when i say if you have it war with iraq, cut the capital gains tax. something to grow the american economy. drop the other costs of government. right now the government is eating up 24% of gdp. it used to be more like 20%. it is jumped up dramatically under the stimulus package and the general motors bailout and the various other ways we have wasted money in the last two and a half years. we need to drop the percentage of the economy of sorts by government. federal and state.

the states are doing a good job and the reforming government. we have gridlock in washington at the state's instead of having a box, you have one party controlling the legislature and governor in 24 red states, republican state, and 11 democrats states. the parties together, they can take a stake in one direction or the other three are getting serious reforms. real savings. real improvements. school choice for the lowest income kids, half the kids in louisiana and indiana. massive reforms. and the quality government and also less expensive government. i would argue that what we need to do -- we are spending 4% of gdp on national defense. you can reduce, if you really felt you had to send more money, you could spend more money out of the national budget to an ex canada and reform of the parts of government to cost

less. you could double national defense to 8% of gdp and drop the rest of the government down to 15%. why is the position of ted kennedy's government -- we will keep the same amount forever and this is mine. this is my money. that is why obama talks about giving people stuff. the money the government takes from you as his -- he used the money the government takes from you as his. that is not the way most americans view the proper role of government. we can afford to invade, occupy and reduce spending elsewhere. benjamin got us into the korean war by telling the chinese we would not mind, -- when truman got us into the korean war by telling the chinese we did not mind -- he kept the war going for some time.

>> i wanted to press you on that last point he made. into the ryan plan, put the act -- total discretionary spending goes up to 3 but 5% of gdp. the trade-off -- if the whole discretionary budget is a but 5% of gdp, how do you maintain? >> you are talking about projections of 2040, the government will spend less.

and the larger economy. 3%, 5%, 10% of an economy twice our size is a much bigger number. i would much rather fund a serious national defense and those things that the government needs to do that are mentioned at least once in the constitution even in passing. of a much larger economy. if we have been growing significantly over the last 20 years -- >> it would make sense to [inaudible] >> no. nationald america's defense needs are set in moscow. the guys who followed did not notice the soviet union disappeared. >> my big question is do you think it matters that this is

the ticket with the least of foreign-policy experience and credibility in modern history? reagan had a cia director perry bush headed defense secretary. -- director. bush had a defense secretary perry does that make an impact? >> i am a big advocate of common sense. ryan's serious about looking at foreign-policy issues. we survived obama and the problems have come not from his farm policy but domestic policy. >> do they have any foreign- policy experience you can point to? if i was advising the president on foreign policy issues, some of the people he has listened to are very serious people.

>> [inaudible] corporations did not take as much. >> why am i advocating? at present, the federal government takes 35% from companies. 35% marginal tax rate. >> [unintelligible]

>> top marginal tax rate for corporations is 35%. for individual right now is 35%. most businesses pay at the individual level. they are passed through s corps. under obama's world, that goes up to 39 by% in january%3.8% for taxes on successful small businesses that are not incorporated. 35% on general motors. it is a massive tax increase on small companies and less taxes on major corporations. which are more likely to be donors. i want to take that rate, both rates, to 25% as step one in tax reform. please do not misunderstand me and think that 20% is a floor. it is a ceiling.

be taken down to 25%. this is not an endorsement. -- we take it down to 25%. this is not an endorsement. i and in favor of americans being treated less poly then -- less poorly than cerfs were. on the way to americans -- cerf for a couple years and then down lower as you have the economy grow. i am a fabian limited government person. we take this is that at a time. i do not have some magic bottom number. >> the only real conservative was eisenhower.

he balanced the budget three times and reduce government spending as a percentage of gdp. that percentage went up under nixon, reagan, both the bushes. i know people do not like eisenhower much because he is a moderate but is there anything to be learned from his success? >> fiscal conservatism is not about balancing the government's budget. that is what cromwell and henry viii up the whole point was, to balance their budget. as much as they spent, they took from other people. that is not a conservative position. the modern reagan republican position -- is different than a lincoln republican party. the lincoln republican party was against slavery and for the union. we have a war. and over 100 years, it became a largely consensus issues in most counties in america, even

among democrats. no slavery, one union. once everybody was in on that product, we say now what does the republican party stand for? that is the problem you have. kansas just finished a conversation with the remaining lincoln republican. that was a really good reason more than 100 years ago. there are little old ladies in mississippi who agree with ronald reagan on everything and they voted for george mcgovern because sherman had been very mean to atlanta recently. [laughter] we're beyond that except for parts of this room. the new movement, this is what i think the obama versus mitt romney and mitt -- an paul ryan

thing are so clear obama can i get away with hope and change anymore. he has to talk about yes we did. versus the republican approach which is written down. the modern republican party, the reagan republican party, is interested in maximizing the rate and that the people run their own lives. the analysis, if you want to know who was in the modern republican party, or on the table. everybody is there because on the issue that moves their boat, they wish to be left alone. taxpayers leave my money alone. businessmen and women, leave my career alone. home schoolers, let me educate my own kids. 20 years ago, that would be illegal. they are very serious about being left alone. the second amendment community -- i serve on the board of the national association spirit -- association.

it devotes to be left alone. they do not lock on your door on saturday -- they vote to be left alone. they do not knock on your door every saturday. just leave me alone. they simply wish to be left alone to practice their faith as they see fit. so the other guy who understands scripture -- if i am going to have religious freedom, so the fact that. that is what the senate wright works well together even though they are a bunch of people who do not have lunch together because the guy who wants to go to church all the looks across the table at the guy who wants to make money all day and says that is not how i spend my time. not necessary that people agree what to do but they agree that we should be free.

in this coalition are people in the military and police to protect your right to be left alone. so around this center-right coalition, there are legitimate functions of government. those guys are part of anti- government -- anti use of government. i always get a kick out the liberals who say conservatives are anti-government. can fight back -- cancer doctors are not anti-cells. they are against cells that are problematic. we are against government that becomes against human liberty. balancing the budget that -- balancing the budget is what the left has been telling conservatives for a long time. we are going to spend a bunch of money and we will be back then you can go raise taxes on the american people to pay for

our big government and they will hate you. some people want to fall for that trick. tom coburn. but the other 99% of republicans go -- i have seen lucy and the football thing and i'm not doing that again. your analysis of balancing the budget at the highest goal of conservatives -- maybe in 1953. >> just a clarification. [inaudible] >> you want to limit the size of government. but clinton held the house and senate, we then had 6 years of republican governance by not increasing spending as his budget projected but by spending less than that. you ended up with a surplus.

spending did not increase. a lot less than clinton was planning on spending. that was very important and it did turn the economy around. limit the size of government, the economy will " -- grow so rapidly and to end up with surpluses. >> i want to salute grover norquist. it is great to see him begin to embrace the clinton legacy which is the sign of progress even if he has to distort the whole welfare story in the process. >> he did sign the bill. >> every other part of the story is wrong. i want to inject a note of bipartisanship. listening to you carefully here and on other occasions, i have

the impression that your attitude towards american intervention abroad as much closer to barack obama than to mitt romney. and number two, the one issue where you really think the republicans could blow the election is on form policy. is that right or wrong? >> obama tripled the number troops in afghanistan when he came into office. i would not allow myself with his views on occupy other countries. what was the second part of that? >> their approach to future intervention, it sounds to me -- it is clear that you are an anti-interventionist and that the republican party is far more sympathetic to intervention and the obama administration.

but this is a very interesting question. i wondered about it during the bush years. in the united states, there is a great lack of interest in the rest of the world. people begley know it is over there. -- vaguely noah's over there. nobody wants to avenge ourselves on the british stealing our money. we cannot remember who our enemies were 40 years ago. unlike the guys in yugoslavia and the ottoman empire who can remember back 1000 years, i was one sitting in a room like this and some guy was talking and

went on and on about the 700's in coastal boat. --in kosovo and i signaled them to speed up you. and he said, ok, jumping ahead to the 1400's -- [laughter] presidents have incredible latitude on foreign policy that they don't have and other issues. in the united states -- there is no national rifle association for national defense. veterans groups are only interested in va hospitals, not drones we have.

you have four places you cannot shell because there is a domestic lobby. the president can decide just to do just about anything else. and people said they probably deserved it. when clinton was blowing stuff up, republicans said it was outrageous. democrats said it was a wise move. when bush got in having campaigned against the crazed what job nation-building, we proceeded to knock out the taliban and stay and knock out saddam was san predicts saddam hussein and state.

the republican base said ok. the code pink people were part of obama's base have asked what obama has done to keep that coalition together. it did not slow anything down. >> he withdrew from iraq and mitt romney said he would try to quickly -- withdrew too quickly. >> i believe he was on president bush paused timetable. -- president bush's timetable. at some point, this is scans verses shirts. when you're right is blowing up something, democrats say that is good.

the republicans say that is crazy. then the team is reversed. this is not taking it seriously. it is a moving issue until you stay for 10 years. that becomes a voter issue. use of independents and republicans not enthusiastic about staying in iraq and afghanistan for long periods of time. if you want to hit the grenada, a pet. you want to stay there? less interest. it is not like other issues. it is very different. you would think we were treated more seriously than we do. our politics drive us to a seriousness about the subject more than other areas.

both sides can be for or against the wars. everybody gets tired when they are not quite sure what the point is. >> thank you very much. >> can you identify yourself? >> i am from the cato institute. you mentioned there is no nra for restraint on foreign policy. how do you impose costs on people so they care about foreign policy? i think you are right that people are indifferent. if you put some cost on the, people belong to the emirate because they have skin in the game. people belong to atr because

they want to keep their money. people say they can deal with the violence but it gets back to how to get people to care and have a cost imposed on them. i remember when the coburn fracas happened. there were many offenses about him -- i mean that and the most favorable way -- theou're talking about quotations were he said he was going to raise taxes. >> right, the conversation goes on with people like blockmckeon

about the sequestered. they say if we have less than $700 billion in defense spending we might be killed. is this something you have delved deeply into? >> i have chatted with all the guys you mentioned. the good news is there is a very small number of them. who has skin in this game? the house ways and means committee and the finance committee. they view deductions and credits as things you can get rid of and reduce marginal tax rates in tax reform. they are doing all the work on it. you have these other guys to say can steal the reductions and credits.

that way you get to tax reform, there will be no tax reform. my job is to make the taxpayer tougher to beat up and other spending interests. the politician says that the spending interests are powerful in washington, let's go mug a taxpayer to get the money. if we make it more difficult -- some of these guys won't come back. the handful of talk about tax increases are by people who are not coming back or are people who don't know they are not coming back. the idea that you will raise taxes on the american people

does not take the place of defense priorities. there's a big republican in that category that i will not mention. he said i would like to raise national defense and not raise taxes and he asked how he could help. do you have performed we you're doing that we could help highlight? doing?rms you're perhaps commitments to various over-spending groups. the answer regattas we could extend it to people that we cannot cut the spending. i've tried these things than they have not worked. push we coulddutcus

get it to the finish line. nothing. that doesn't solve all the problems. several tens of billions of dollars. i believe we will get serious conversation from some of the defensees of national dispen when they understand," here is the dollar amount. make teh decisions." they want to argue that you have to raise taxes. i think it's a mistake. if you are not afraid to try, no one will helpful in -- help you, starting with me.

you have to be serious. the lack of seriousness at the guys trying to reform the pentagon are just doing everything they could. if they just said they were doing everything they could, but they are saying there's just nothing to be done except more spending. salere not just making a and they are now competing when they say they are not going to raise rates. we're not going to raise tax rates, only eliminate credits. sometimes they do not think alternative minimum tax is not a tax. the can raise dollars -- raise taxes trillions of dollars and have convinced themselves it's not a tax increase -- it is. they want to take that and spend it on defense.

the tax reform programs want to be used also. this is key to our strength as a nation. inutes.ave two me quick question and answer. but that is probably the first time. fundamentally, we have some people in this room understand what tax does and does not do. russia, the tax is used against corporations. to the argument that the taxes required for good government, no tax, no government. the gatt nigeria. across the world, you can couple the ability to honestly tax the

people with the people's voice. if they are not taxed, they have no speech. if we're going to go to war and you raise taxes to go to war, it engages the populace, the body politick more closely and they will watch more closely instead when they're being told. it is just away from the details of the organizational tax rates and the fundamental reason behind taxation. >> very quickly. >> you have taxes to pay for the legitimate constitutional parts of government. things that are actually written down. general welfare. it could mean anything, therefore it's nothing. [laughter] news of the guys who never does

for the second amendment when they read the constitution. first amendment, stay with it. it is stated local government and an interesting different? you have federalism competing. i think what you do to get good government does have the best competition you can. people are moving to read state. they are sending their money to read states and leaving the blue states. 10 years from now, we could see a coastal split. the states like wisconsin which is fixing the pension problems, unionism, and utah fixing it to get rid of defined benefit pensions, 10 years from now,

michigan which ended defined i contributions, there are now working on other stuff. you have the country moving in two radical different ways and you will have some big government france-greece states and some singapore states. the problem is that taxpayers are going to leave the states that want to abuse them and move to the states that do not. there's going to be this incredible shift here. then we will get those who do not want to pay 75% tax rates to come over. taxation is necessary to provide the rules for the free society like protecting your property.

i will limit it to that. you want taxes to be as limited as possible. i'm not sure about the idea that if we had limited tax as we would be less likely to go to war. the more taxes, the bigger the government, the less voice people have. the government has a bigger voice than the people in russia and they tend to run the media and other projects. i think it squeezes out the freedom. and also sound like a backwards argument for the draft, which is very problematic and a serious tax on people. the draft is one of nixon's great successes in making people freer and improving the competency of the military. >> with that, we are adjourned and we thank you. [laughter] [applause]

c[captioning performed by national captioning institute] [captioning performed by national captioning institute] >> new york city mayor michael blumberg and news corp. chairman rupert murdoch recently gave advice to the obama and romney campaign on immigration policy. >> what would you like romney to do on immigration or say on immigration and what would you like obama to do or say? >> either one, i would love for them to say that they would change the whole system. at least in the beginning, get rid of this, get the high graduates in. according to the law, provide

that they learn english and give them a path to citizenship. they will pay taxes. they are hardworking people. why romney does not do it, i have no idea. their natural republicans. there catholic. there are family people. >> minority groups, although they seem to all be in the democratic party, but they tend to be much more conservative and have republican social values on choice, gay rights, public schools, that sort of thing. they're walking away from the latino community. you know why romney does not do it. the screams of his own party would drown him out. >> water they going to do? they little corner of the party?

to bad. the worst they will do is that a few of them will stay at home. >> can you conceive a republican convention where they do not nominate romney no matter what he says? what's the downside? in terms of the general action, the people nor opposed to immigration are not want to vote for obama anyway. there's no downside. the same thing is true for obama. >> you can watch the entire event. later today at 5:00 p.m. eastern on c-span. this year, watch coverage of the republican and national -- republican and democratic national conventions. we have your front row to the convention. coverage begins august 27th and continues through the 30th.

the democratic convention is september 4th through the sixth. live on c-span, c-span radio, and c-span.org. >> tonight on "q&a," walter pincus talking about his jobs as a journalist, and his views on extravagances spending overseas and defense department. >> it is about 40 people. there's room door everybody. the use them for dollars million on an elementary school, and that people would gradraise questions. >> former state department and united nations officials spoke last week about u.s.-iran relations discussing nuclear program, israel, and sanctions against the shipping and finance

sectors. this is one hour, 30 minutes. >> good afternoon. it is a real pleasure to welcome you to this middle east institute even to announcing a middle east institute scholar publication called "prospects for u.s.-iranian relations." on the nuclear issue in the year ahead, i find this a remarkably clear, straightforward, and very useful analysis of the situation. it is one that avoids any of the pitfalls of the journalistic treatment of this issue in

washington today. it is a particular pleasure that i was asked to moderate this panel. if i have any qualifications for the role, it is my time at the u.s. institute of peace and i spent seven years abroad as a science counsellor in american embassies preventing technology to go into potential proliferators than three years managing one of the energy offices in the state department. we have a wonderful panel that includes the two principal authors of the report, allan keiswetter and geneive abdo.

it is not my habit to do biographical introduction because, after all, you have them in writing and you can read them at your leisure. i like to say something striking about each of our speakers. for allan, i read his biography here and i said to myself that what you really need to know about allan keiswetter are his posts -- baghdad, beirut, etc. not a bad representation. it's really quite extraordinary. i know him from our service together, intelligence, and research. geneive abdo i do not know well. when i asked her what i should

emphasize, she offered me something not in the bio. it is a book from 2003 called, "answering only to god, faith and freedom in the 21st century iran." i think it's particularly relevant to the issues we have to discuss today. you can read her distinguished background as a journalist, u.n. official. she comes to less well-prepared. unfortunately, we're going to mess melissa, who is ill today, but we have roby bqarrett to finish this up. i can't say i know roby well, but i can tell you when you are in a meeting with him, you will know what he thinks about

things. he has the particularly incisive way and a brutal honesty in dealing with military issues which have been a real focus for him. i will ask allan to do an initial presentation of the report. >> i said i was the deputy secretary for miscreants, iraq, iran, the arab peninsula, libya. fortunately some of them have become good guys, but we're back to the miscreance today. i also feel a little bit like the head of the corps of

engineers who come in and the appointed, was reluctant to make a public speech. however, he saved up his energy until the was invited to speak on floods. he felt that was a topic he felt he could do justice and he did well until i got the question when he discovered that there was no one in the audience. i recognize him out there. i would like to do two things today. the first is to summarize the report and the key judgments overall with a little bit of filling in on israel since melissa cannot make it. the second part is to talk about the u.s. perspectives on the iranian

now likely to remain in a stalemate. there are margins for negotiation and i will return to that in a bit. on iran, and like to come forward with our key judgment which is that it is not clear to what extent i ran as committed to a diplomatic outcome. mild sanctions exact a significant toll, they seek out -- they seem unlikely because they are prepared to hunker down as necessary. in addition to this, therefore, we vote strategic pressure are not very important. she will expand on the iranian position. on israel, without sufficient diplomatic progress, there was

an uncomfortably real possibility of israeli military actions because of the israeli perceptions of existential threat. i think cents melissa is not here, i would like to just read a few sentences that i think express her points. should focus on the military option because, "this is where we truly are. the debate in israel is that israel has the capacity to hit and destroyed the known nuclear infrastructure with the unknown sites to have the capacity to sustain advanced nuclear program after the attack, how would the iranians respond?" she concluded it would be a serious mistakes to dismiss the possibility of an attack. netanyahu thinks he can do what he wants despite u.s. opposition.

lest you think any group care has consensus, i will have to read this next paragraph. persons said his comments are intended to press the u.s. and to take a hard line stance and scare the iranians into concession. given israel's military capabilities, he said there was more elasticity than one would surmise in netanyahu's remarks. i think this is a fair representation. i would like to go on and make another comment about our key judgment on the gcc states. they have unprecedented unity in the fears of iranian pretensions. we think it is likely to hold, still there are nuances among the states and they may not

fully be aware of the extent to which they risk iranian retribution. roby will expand on that. we think next year will almost certainly market turning point in u.s.-iranian relations. without progress, the trajectory of the u.s., of israel, of iran, though they are not settled, it could lead to nuclear conflict -- excuse me, to military confrontation. i would like to go on and talk a little bit more about why we reached these conclusions. i will stick to the u.s. position. what is the current situation? the administration has a two- track policy of engagement and pressure. the engagement will largely taken the form of negotiations,

sanctions, and what one may call active measures. obama has made clear that, "all options are on the table" except the option of containment. he says moves by iran to actually weapon is for nuclear capabilities would cross them. excuse me. in the short term, we think, therefore, that the prospects in the movement, it would not be great, particularly before the elections. p5 +1 is asked for a suspension of iranian enrichment than they are shipping out at that level. the second and thi conditions

are working at the heavily fortified facilities. in return, they would offer minor inducements such as spare parts for iranian airplanes. their response to this has been low. they have issued such a small deal -- eschewed a small deal. it is centered on the lifting of sanctions. from the u.s. point of view, that would be the end game. from our point of view, we are not even in the game yet. we have a defective suspension of talks because of the west's willingness to wait for the full effect of sanctions to come in play and because the iranians insistence about assurances about their rights and to

enrich. we think the prospect for extended diplomacy is better. once the election is over, a second obama administration could be able to consider a broader deal and they may have sufficiently felt the effect of sanctions to be willing enough to negotiate on specific steps. it is an acknowledgement of their right to enriched to a limited degree, 3.5%-5% in return for stringent monitoring and inspections. there has not been a "full throated discussion" according to a former senior administration official. any acknowledgement of their right to enrich would run against u.n. security resolutions, aggregate is really sensitivity, alienate u.s.

supporters of israel, and accuse the president of being soft on a round. these risks are not acceptable to the administration. whether they would be acceptable later depends greatly on the extent to which these kids be -- these could be mitigated and also process for an arrangement could actually lead to stem iranian nuclear development. if there is a romney victory, the specific nature of his policies remain largely speculative and extrapolation of his generally hard line decision on iran. if the same continues, he would prefer to focus on campaign priorities. whatever the administration is in power, extended diplomacy

includes, first, a stylish and from work or regular negotiation and broaden the discussion beyond the nuclear issue and established a private u.s.-iran channel to discuss bilateral issues. these are points on which we could make progress now. another is the deficit ofp5 + 1 solidation but the prospects are uncertain. they do not fear the consequences of a nuclear iran to the extent a u.s. does and there are growing differences over syria and other issues. another possibility is crippling sanctions. administration officials describe this as, "truly crippling sanctions." if they would go through, it

would extend treasury auctions to a wide range of imports come lot like now. such sanctions may find limited support abroad, hurt the iranian people with little effect on decision makers and offer no guarantee that it would be a pre lewd to a popular overthrow of the government. moreover, not realize that a certain level of iranian oil experts must be preserved to maintain stability in international energy markets. i would like to sum up and tell you where the group came out. there was easy agreement among the concert -- conference participants that the best area is deployments in but there were sharp disagreements about whether diplomacy have a decent chance of succeeding. one group argued that the

iranians would not dismantle the nuclear program unless the existence of the as promised republic is at stake. they see iran with even the capacity to produce nuclear weapons as an existential threat that they will not tolerate. the united states has stated they will not allow iran to develop a new weapons. the leading gulf states are adamant in their pretences. given these projections, their conclusion is the potential for military confrontation over the iranian nuclear program. do not deny these in the bitterest paramilitary confrontation this will allow

iran to enrich and it could be possible later. the margin for negotiation include the of the iranians do not want war in their territory. the best option is not to go it alone but at least with u.s. support. the u.s. for a family does not want another war on the heels of the ones in iraq and afghanistan. the world fragile economy would suffer yet another severe blow. there was common ground, a realistic view possible hostilities wall in dodging it is time to redouble efforts on the diplomatic front including staving off military action in the near future, keeping the negotiations opened, movement

towards the discussion of enrichment at some point soon. this would probably be sometime soon after the u.s. elections, will establish a track or non- nuclear issues could be discussed and make clear to them what has to be done for sanctions to be lifted. >> good afternoon. hello, everyone. as allan explained, i hope we do not sound repetitive, but my specific remarks and then to be focused on how iran but the use

the nuclear issue, and more broadly, how would use its role in the region, and what has changed since 2003. in examining our ron's position, it's important to put it in a context and were there were in a $2.30 when the world and to negotiate only afghanistan. the ayatollah are actually sent a letter to then president polish by the former swiss ambassador in iran in an attempt to reach the kind of breakthrough we're trying to reach with iran now. in explaining what has changed, we can grasp how gloomy the picture is born for work.

even if we set the minimal goal of a trust building exercise with nuclear negotiation the without even assuming a breakthrough could be reached, i ran an hour and not in favor of establishing any sort of trust with the united states because of the way they have been viewed in the region and also u.s. policies. iran is convinced that the ultimate goal of the united states is a regime change and the nuclear issue a more regional issues over syria, u.s. activities in afghanistan and iraq, all of this was meant to undermine the islamic republic and this is the way that the regime views united states's intentions.

unlike 2003, we are long way from convincing enron, that this is to build trust. and do not need to generalize about the iranian regime. i'm speaking specifically of of the initial goal and the supreme leader come in. if he were president right now, we probably would not be having these discussions because political personalities do make a difference. the generation that created the revolution think differently than some of the other people we have seen come to power.

in a way, there is a belief that the united states has created a self-fulfilling prophecy. he continues to reiterate this belief. in july, he said the animosity of the arrogant nations returns to the principles of the system ." they try to make the nation with the iranian nation seem as though it is founded on human rights and nuclear. he says is not founded on human rights or nuclear, but the regime change. you have to ask why he would believe that. if you read the american media as they do every day, there are statements coming out of people in congress in statements from republicans candidates running for president that we need to

launch a military attack on iran. why would you not think the ultimate goal is a regime change? dan oliver continue to hide the nonconventional mean in the region. as we have seen, the revolutionary guard in iraq and syria, they become very active. the iranians have taken a direct policy toward the intervention regionally. another significant change of has happened over a long time is the educated middle class which was once the bases for the reform movement and they have been completely marginalized. this is the sector or by iranian society that is very favorable to americans and they want iran

to cease being a pariah. will they have political power, they were those looking for ways to break three decades of political hostility. other reformists recently of also, out and stressed the need for a settlement. those voices have been silenced. there are no longer politically relevant and that is something that has changed dramatically. another thing that has changed is the mass movement for democratic reform. the regime has completely triumphed, so the voices that could put pressure on the

regime, whether it comes from society or in the system no longer have influence. i was reading just this morning an article on foreign relations that made the argument of all the nuclear issue because the democratic revolution could be coming if we're just patient. people tend to draw parallels, but the parallels should not be made because we're dealing with a completely different type of of authoritarian state and political culture. you do not have the advancement of civil society that you had in egypt or tunisia. the kind of civil society does not exist in our ram. another thing that has changed is the political and

longstanding economic power they have built in the country. the revolutionary guard, it could be argued their position is very similar to his. although could be argued that they stand the most to lose from the sanctions because of the great economic interests in iran and abroad, nonetheless, it would serve their interests because it would reform along have positioned about the united states specifically, we're not very hopeful on the specific points regarding the nuclear negotiations. there were many who argued that

if the united states will offer air ron that this deal could be the point that sealed the deal. unfortunately, although they have been talking reducing in richmond a few years ago, there are no longer moving on that issue. there also no longer entertaining the idea of shipping out the uranium making it an easy case for israel that that they have now entered the zone. the reason there's so much discussion now of a unilateral military attack is that they're convinced that they have reached nuclear capability, even if a political decision have not been made to build a nuclear bomb. as they continue to enrich uranium, this is bill -- ability

to the israel argument of their intention. just last week, netanyahu and his top ministers declared that the united states and the west should officially announce the nuclear negotiations had failed. you can see how the way is being paved for them to appear that all options have been eliminated. when i was in israel in march, even then, it was clear to me in the meetings i had with israeli officials that come even though the position towards iran is much more nuanced and much more, i would say, profound, the conclusion is still the same.

they must be stopped before their new clearly capable. i will conclude with a few more points. have asked for all sanctions to be lifted before there are any serious talks on the nuclear issue. it is highly unlikely sanctions would be lifted. i think, for all these reasons, it is clear that iran is interested in prolonging the diplomatic process but not necessarily reaching a breakthrough. both sides now have a reason to prolong the process. president obama does not want any unilateral attack before the presidential election and the iranians want to buy time until there is, perhaps, an unpredictable event that would allow the gamut -- the diplomatic process to go forward

even though they realize there is unlikely to be any kind of concrete break through. i think the other issue that has changed dramatically is politics in israel and the united states and we will be discussing up further in the q&a. thank you very much. >> before i give the podium to roby, a love a standing-room- only crowd, but there are some seats up front and your more than welcome to come down and take them. don't be shy. >> i like the introduction. i think i will put another back of my next book. and warn the talk a little bit

about the gulf, what i call diplomacy and war with iran and donna will touch a little bit on israel and policy. i see the short-term fallout of war were born to be looking at in the next six-nine months. i agree with her analysis of where the iranians are and i would add that if you put your self in the position of the revolutionary guard and you evaluate your interests that they are pressing ahead with the nuclear program and not really interested in negotiations. think about it from there. i want to talk about the gulf.

i spent a lot of time there. since almost the beginning, the last eight years since the beginning of iraq, there has been a consistent theme from gul about the iranian intention, the gulf and across us -- the ultimate process and that the u.s. has been somewhat 90's. it is past administrations as back as far as you want to go. they do not believe the armenians will give up the nuclear capability and they believe it will move towards afghan possession. they have consistently said that the world needs to do something about a, the world meaning the

last -- meaning the u.s. they come with a second statement that another war in the gulf would be disastrous. i do not know how you would reconcile the two. what has emerged as a resignation on the part of the more hard-line states in the position they're taken on nuclear weapons that the only alternative is going to be war. as one commentator said almost three or four years ago at an mei function, "for the first time, i have come to agree with israel almost 100% with an issue and it is the nuclear capability and the direction iran is headed.

then you look at the war issue. the possibility of war as create a difference in the way some of the state's view the issue of conflict. you could argue that kuwait, saudi, and bahrain, and abu dhabi want to see teh program stopped. people in qatar have a nuanced view of it. here is where i think they make a mistake. i think they seized some possible separation in the division and the various states on the issue of their position of nuclear weapons or their preference for hegemony that

exists. there are pronouncements by senior porforeign-policy advises about bahrain being a province of iran. they dispatched the minister of the interior to explain that is not what they meant that all the real problem with the american presence and zionism. to a degree, the iranians do not understand just how much their policy position and overall latitude is despised across the waterways. while they may press the issue thinking there is some daylight, and does not exist behind a

policy of to either end or curtail their iranian program in one way or another. that being said, i do not think anyone has added up the potential cost for a full-blown conflict. everyone is one new systems that we're busy integrating, command- and-control, etcetera, and were looking at all kinds of options, but i think the impact in the event of an actual war is started would be significantly more than most of them have come to view as expected. set that aside and it raises another issue. i tend to agree that the iranians are not want to

negotiate seriously over those, if they view this with in their interest to pursue a nuclear weapon, this goes back to the shah's, a historic view of their role in the gulf. isthat's the case, it difficult for me to understand will stop war which brings the issue of diplomacy and war. i see diplomacy as a tool in forwarding your policy. it is used to add stability. was is another tool they have

used to forward interest, although it is far riskier. given the armenian position and the israeli position in the daylight between the american version and the israeli position, capability vs possession and the red line that they say takes capability, then i think i think it will be very difficult for the united states to stop the israelis from attacking the iranians if they decide they had to. impossible, as a matter of fact. just as i think it is unlikely that sanctions will work. looking at the future, i think it is likely we will see conflict.

it is very unlikely that we will see the united states -- i think it is very likely that we will see the united states initiate an operation. if a unilateral israeli attack against iran's nuclear facilities occur, it is going to be as much political as it is military. the one thing holding the israelis back right now is the fact that officials are concerned about the limitations. it is a 2000-mile round trip and is much more difficult than anything else they have undertaken. there is a strong preference that the united states did with it. one would have to assume that a

unilateral strike would express a level of, if not desperation, but a level of very heightened concern on their part with a political objective of bringing the united states into the conflict, most likely by the iranians lashing out at everyone in the gulf. thank you. >> if anyone thought that mid august was a time for cheer, they have had that illusion dispelled. we have ample time for questions and comments. do we have microphones? we do. >> [inaudible] >> that is good to hear. who has microphones? very good. this gentleman here in the

green shirt, stand up so they can see you. oh, no. wait for the microphone. i meant the other guy in the green shirt. you can go ahead and we'll take the other guy. >> let's try this one. what do you suppose our policy towards iran would be if they had no nuclear program? i argued it would not be very different because the real issue is strategic control of the gulf. that issue is ongoing and is likely to become more dramatic >> can you identify yourself? >> ken. >> allen, it sounds like a question for you.

>> can you hear me? i think i agree with you, ken. the issues would be separate. we have had 30 years of negotiations with the iranians or non-negotiations on issues. but i think the nuclear issue is bringing it to a head. this is something that we think actually threatens our own national interests so severely. that is the dominant issue. i think you are right. >> can we have a microphone down here please? pleased to introduce yourself first. >> the surprise invariably results from faulty assumptions. one of the assumptions we are making here is that when iran

completes its bomb, it will test it. there is a proven design in the possession of iran. there is no need to test on iranian soil. they can test in downtown tel aviv. that is how strategic design happens. there is only one way to make sure iran stops completely its nuclear weapons development, and that is to promise them that within 48 hours or iranian use by iran or one of its surrogates, the city of tehran will be destroyed. that announcement now and kept perpetually as a promise will make the iranian nuclear weapon useless. >> we have a proposition to intimidate the iranians out of

it. can that be done? >> i don't think so. i think that what we've seen over time is the more iran is pressured and threatened, the more belligerent the regime becomes. if there is one lesson we should take away over the last decade, iran does not respond to pressure in a way that is constructive. i think that approach would be very counterproductive. >> that begs the question, what would the iranians respond to? >> i think that a while ago, they were responding to collaborative efforts in afghanistan. there have been several

commentaries written over the last several weeks that cooperation over syria could be some sort of entry point into improving relations. i think that is a very interesting and constructive proposal. i do not know if that leads us to a breakthrough for the nuclear issue. if we go back to the beginning of the whole trust issue and what i was mentioning a few minutes ago, you have to start somewhere. if there could be another issue upon which there is collaboration that is not about the nuclear issue that could be a trust building measure with iran, that could be one way of eventually getting to the nuclear issue. this proposal was considered by the u.s. government for many years. that is the reason why we were negotiating over afghanistan, to

create some sort of broader relationship in which we could discuss many things. the reason we are at an impasse is there has been far too much focus on the issue and not enough focus on issues where we have commonality between the two countries. >> i actually think what you are talking about is -- saying if you do this, i'll do that. that already exists. if something bad happened in downtown tel aviv or the gulf, the iranian republic would be attacked. i think this is all -- i do not think is very constructive to make threats like this. they understand a nuclear attack in tel aviv will be the end of the iranian republic and will be responded to accordingly. >> [inaudible] >> i think they absolutely do. >> i have asked you to not do that partly because you will not be heard.

>> what we are trying to do is figure out how it does not get to that point, where somebody can make a mistake whether it is the iranians making a mistake. this is what we're trying to do. it may very well be this idea that diplomacy -- this idea that somehow diplomacy and war are separate. it may be the only way you are arrived at negotiations at this point to prevent that type it may very well be this idea that diplomacy -- this idea that somehow diplomacy and war are separate. it may be the only way you are arrived at negotiations at this point to prevent that type of situation. it may be through a war to negate that effort. not the case.

we are pretty pessimistic about it right now. everybody. i hear what you are saying, but i think that is already understood. this idea that the iranians are a crazy people who do not understand this is utter nonsense. that is people who do not understand how it is worked in the iranian context. i think the iranians are aware of it, and i think it is a huge risk. when you do not know how to control it, you can have that happen. there is no doubt in my mind whatsoever that if the iranians had a bomb and unloaded it -- whether you have the design or not, and i spent a lot of time in the nuclear weapons industry, you do not know whether it will work or whether

you have done it right until you put it in the ground and pop it. >> the gentlemen in the back. >> i have a question. studying the iraqi case, that did not finish the program. that hindered the program and started the military aspect of the program. would it an israeli attack on iran might lead to a crash program similar to the iraqi program that started after the invasion of kuwait? would that have -- if the iranians started to do that, how would the u.s. respond to that? >> allen? >> i think i am going to defer to roby on this one. roby? >> here's -- i actually believe

this time the knowledge and technical capability is dispersed enough in iran that the likelihood that an israeli strike could do it any more than temporarily curtail it. it is probably not very likely. i think the iranians learned something from 1991. you do not put all your eggs in one basket. i was recently at a function in germany. the germans have a very good relationship with iran. a lot of their analytical people are trained at the university of tehran and other places. we had this exact same discussion. when i pointed out that the sanctions had come too little,

too late, he said but nobody has an idea. which is true. i do not think it is a question of if it would happen. which leads you to the question of is it going to look like the no-fly zone over iraq from 1991 to 2003 where you are constantly trying to redo it? short of the fracturing of the entire iranian state or what happened to iraq by accident, you are not going to see that capability go way. that is a huge issue right there. it is so ingrained in their perception of themselves, of sovereignty and national rights, even people who opposed the

regime and replace it, they believe it is their right to do with it what they want. >> i have to ask you not to conduct a conversation without the microphone. [inaudible] >> what if they use the safeguard day already have which is almost 80% enriched? to produce a single bomb in limited time in three or six months. >> i think i agreed with you. i think it would be an ongoing thing. we would not get it all. >> you raised a really important point. i hope that no one misunderstands that even though we are in agreement it seems more likely now than before

military check. this is not something we believe it is the solution. i think you raised the most important question. what happened the morning after? if you read all the statements coming out from israeli officials and politicians, they openly acknowledge that a unilateral attack will not set back the nuclear program. they have openly said maybe they would have to have isolated attacks on nuclear facilities every few years. i think it is safe to assume that a unilateral attack would hasten iran's nuclear program. from everything we know about the iranian society, it is an issue that is a point of national pride. if the country were attacked on that basis, you could assume there would be far more support

for the government than it exists today which is completely counterproductive for where the united states believes it interests lie. >> let me take the gentle man right in front of you. >> thank you. i am part of the treasury department. you talk about sanctions before. we hear that the sanctions are different country sanctions, things such as that. i am waiting to see one case outside the united states where a financial institution, individuals, an organization or anybody either paid a fine or was in prison. when i ask that question, it is very embarrassing because i think what happens is there is no example. what i often say sometimes is there is an old italian proverb

that says many pairs of shoes are worn out between saying and doing. i think it is wonderful that we war. as the general said, even silence is a weapon. i am just wondering what your views are on sanctions basically. that. since you work for treasury, you may be better positioned to answer your own question than i am. but i think the retribution for violating sanctions has not necessarily been imprisonment and fines. it has been the denial to the u.s. market which discourages doing business or buying oil

from iran. there have been punishments. as to the exact answer to your question, i cannot answer that. to some extent, it is not the most relative answer. the effects of the sanctions have been very well known. there has been a drop in an iranian oil exports and an inflation rate that has now about doubled. there are beginning to be shortages. i think the effect is there. the question is does this economic effect have any political effect? the answer is unclear at best. >> the gentleman down here. >> i am jonathan from congressional quarterly. in the report, you mentioned the political constraints to get into a serious negotiation

with the iranians. i am talking about why the diplomatic track has stalemated. given one of the key demands is recognition for the right to enrich, in your view and that of others on the panel, is it politically impossible for any american administration before or after the election to recognize that kind of right? >> good question, and the answer is, again, i don't know but let me tell you what i think. it is certainly politically impossible before an election. after that, it is conceivable that the administration could come to an agreement based on this basis.

what are the alternatives? are you willing to attack periodically? are you willing to send in the troops? are you willing to absorb $800 barrel for oil for several months? i am not as pessimistic about the chances of war. frankly, the results are horrendous. i see this as a chance for renewed efforts of negotiation. it in some ways reminds me of the peace process. people know the answer but they cannot find the political will to get there. it is a question of coming up

with tight enough controls so people can have confidence that they will work. so, politically, that is a different problem and it deals with the nature of american politics. we will have a better idea after november. >> maybe i can add a word to what allen said. you have to realize there are quite a few countries that have reached the point that iran has reached in terms of capability to enrich, for example, who has stepped back. the equation in brazil was simple because they had only one motive to develop nuclear weapons. that was argentina. a mutual stand down was

possible. how does the iranian situation differ from that? several important ways. 1 is complete lack in confident between iran and the people who threaten it or might threaten it. another is it is a multi-party situation. it is a much more complicated situation and one in which building confidence is much more difficult. if you have what allen is pointing to, which is very strict safeguards, you really -- an agreement is conceivable. we are not imagining something that cannot be imagined. it is something quite possible. the equivalence has been done in other cases. let me take this gentleman here.

>> my question relates to the previous question. we hear a lot iranians are not seriously negotiating. but from the report from the summary mr. keiswetter mentioned, i heard today the effect americans are waiting for the sanctions to run its course and influence iran's actions. at some point, americans are moving on full speed with the pressure track. and they are having their diplomatic track mentioned.

but iran always has mentioned acted it is not serious. i want to say there is no excuse for the iranians' unwillingness in the past, but from what i know, this time, iran for its own various reasons is seriously committed to negotiations. unfortunately it is the year of a political election. the americans perhaps hoping that sanctions and the dynamic of the election -- they are not committed.

that is a comment i wanted to make. the second one is -- you got me lost when you said [unintelligible] proposal of accepting the right of 2.5. you do not see iranians are serious about changing the course. i would like to get your evidence of that because i do not see that. thank you. >> do you want to start off? >> i want to go back to the broader point before i answer your specific question.

i do think that if there could be a way -- a measure of confidence building after the november election, perhaps iran would entertain the enrichment reduction. but i think the problem has -- the problem that has developed, at the time when iran was willing to seriously consider this proposal, the united states backed away from it. from iran's perspective, every time they come close to accepting something that they never said they would accept in the past, the offer is withdrawn or is it is no longer a possibility for a variety of reasons. so, i think to answer your specific question, because there is a lot less confidence on the

iranian side, i think it is much more difficult now to get to that 3.5 to 5% that was six months ago when the ambassador first floated that idea in the "boston globe." that is why i give the answer that i did. as this process evolves, the iranian perception is that they do not want to ever think about offers any more because as soon as they get close to compromising, it is no longer on the table. there is absolute evidence for that. every time there seems to be some sort of negotiating process, the west makes greater demands. that is why i am not very optimistic any longer. however, if we could turn the clock back after the presidential election, maybe

there are talks over syria or in negotiating process that goes confidence-building measure to get us back to where we were six months ago. regime. to say they are not is somewhat ludicrous. a lot like it is important for us to realize to what degree the sanctions are hurting the population. we should never forgets that. that gets lost -- people cannot afford to buy a ticket anymore. the devaluation has tremendously hurt people's buying power. the middle class is suffering the most according to a lot of economists. i think we have to keep that in mind as we talk about the effect of sanctions. >> are the americans negotiating seriously? >> i think they are.

maybe i differ a bit from genevieve. we are now able, politically, to reach a deal in a grand way that the iranians would regard as satisfactory. the proposal is in essence a series of confidence-building measures that in the american view could lead to serious negotiations on big issues along the lines that they suggest. it is the old adage about walking before running. in this case, crawl before you can walk. the iranians have not been willing to deal with this. you have a mismatch and i guess my own thought is that he eventually, the fears that come

from the fear of war will perhaps lead to all of this and i do not see that happening before the u.s. election. >> thank you, i am from the u.n. press corps in new york. i like to address this to any of you, but particularly to you -- this goes to the question of what is really going on and what the people really think inside iran. do the people at large really support the government on development of nuclear weapons or do some of them really believe it is only for peaceful purposes? do they support the government or this any significant

percentage of the population -- do they say we have one of the world's central puddles of the planet and we are spending all of this money on development of peaceful alternative sources of energy? does nobody realized that this is costing the government and therefore, it is costing us. >> i would like to turn that question over to the iranians in the room to get their opinion. there are some familiar faces. maybe you could give us a sense of public opinion in iran? >> where are you? there you are. >> i think it is --

>> can you stand up, please? >> the question is the vocal to answer because i personally am not great enough to represent the public opinion or claim that i know what 75 million people in the country think. it is also very difficult because when you talk about all of them, some polls have been conducted. they're very difficult to judge given the restrictions that society experiences from the government. for the most part, i think i will defer to a lot of scholars who have written about public opinion and what the iranian public believes when it comes to nuclear issues. i think this is one thing that the public does support the government on. now, the question is after sanctions, how will it affect the people if the costs are

increasing? the impact is felt by the public -- will the public change their opinion on this and say enough is enough? we cannot play chicken. we would rather go along with our everyday activities and livelihood. maybe there was a second heart to your question? [inaudible] >> did they not see what it was doing? sorry. do they support it only as development of peaceful uses of atomic energy or do they not realize what the real intention is? >> the real intent of the government depends on who you

speak to. the government says they are not even developing nuclear weapons. it is for peaceful energy purposes. that gets very tricky. it depends on what segment of the population believes what the government tells them and which segment and to the more educated -- do they have doubts? it is a different answer. it is hard to say that the costs are impacting the average people. it is early to say if that will change public opinion against the government or not. >> thank you. you have a question, pass the microphone. stand up, please.

introduce yourself. >> my name is jessica. i have a reaction to the comments that were made on the two track system. it is politically dangerous to reach an agreement with iran. with regard to come into negotiations after the election with a degree of credibility, it would be important to have sanctions on the table. as to crippling sanctions versus truly crippling sanctions earlier, i would like you to respond to -- we continue to up our military presence in the gulf. if we continue to do that, additional sanctions were possible. we have targeted everything. how do we -- should there not be a form of trust and the size to be on our side to demonstrate a

willingness to negotiate? not that there is paralysis before the election -- >> perhaps the biggest element of trust is the intent of the u.s. effort to convince the israelis that now was not the time to attack. the rest of this is sort of beyond administration's control. that is my answer. >> you may point earlier and that is something i would like to address my question or comment to. you said that there must be something that would make the iranians agreed to it and if i

were an iranian negotiator, my position would be to dismantle his trial's nuclear capability, number one, destroy israel's nuclear stockpile, number two. number three, we want to get the russian and chinese's position with respect to a unilateral attack on iran. i think they should come forward and say they would neutralize israel just as the u.s. would say if israel was attacked with a nuclear weapon, i run would go up in flames, just like it was said during the 1960's -- when france and england attacked egypt. if you do not stop the draw, london and paris will go up in flames. there should be counterattacks

to stop israel from attacking because i do not think -- president obama's cajoling will not stop them. >> anybody want to take that one? [laughter] >> i am a realist. i do not think is right will give up its nuclear options -- is i'll give up its nuclear options. if that is what is required, that will put us on the path. -- >> i think there is an issue. people are top -- talking diplomatic traps and pressure traps. conflict traps. all of these are part of the process. if they conflict breaks out tomorrow, the you think there will not be this incredible

ferry of diplomatic action? about trying to limit it and do this -- on the other side of it because the problem of iran is not going away but on the other side, there will be continued diplomatic and whatever. seeing these things as alternatives is wrong. i think they are all part of individuals. there are parts that are much higher risk than other parts. anytime you start thinking that you are going to solve a problem with a war, you better think about it again, because you are going to create another problem. anytime you think you can absolutely prevent a war and create a stable situation for negotiations when the tensions are running as high as they are and the positions are as hard as they are, you are also being naive. i think it is more productive to

look at this on a continuum. one more comment about the iranians. if i were the iranians or i were advising the i iranians, i would look at the past 10 years and say the u.s. has destroyed our enemies in afghanistan. they have done everything, accomplished every goal that we have in the iran-iraq war. they have gotten rid of saddam and they have placed the shiite in control of iraq. the u.s. comes around and wants to have a relationship. they label us. we are the access of evil and then they do nothing about it. we're not talking about this administration, ok? the u.s. is trying to get the israelis to back off so they can let sanctions work. i am not sure we were serious.

i think they are making a big misjudgment about just how serious this situation is right now. i think it is serious. >> i have three comments. i would take your attention to the quotation from church hill on the cover of the paper about war. secondly, about israel and its nuclear weapons, there are beginnings along these lines of u.n.-sponsored conference on the middle east, but that is only the very beginning. >> let me take this gentleman in a blue shirt. wear a bright blue shirt. >> i am from human rights watch. it seems that in the last few weeks, we have talked about the

sanctions harming the civilian population. it seems to me that the only good option with iran would be for the regime to fall and a new regime to pop up that would may be not have the kind of rhetoric that makes israel and america so upset. if the sanctions are harming the middle class so much to the extent that civil society structures are collapsing, and if they are not deciding enough to really harm the regime, because as we all know, this regime wants to stay in power. if they launch their nuclear program, that is where they get money. if the sanctions are not preventing the regime from doing what it wants and it is stopping the people from building a civil society, what is the point? thank you. >> they have 40% less income to do things whether it is nuclear

or otherwise. i think it is not right to argue there has been no response. it just has not been concentrated enough at the political level. whether it will reach that is another question. i do not know if you have seen the movie "of the green wave" but i recommend it. the regime is now so cruel and brutal that is provoking a resistance that may take some time to generate. there is a reaction to the -- to what they have done. i was very struck by one of the tweets saying our greatest weapon is hour endurance. >> one last question. then i am going to ask the panel to make final remarks. >> i would like to hear the

panel talked about -- >> tell us what the argument is. >> let it go. having a nuclear iran will create stability in the area and give them enough self- confidence -- >> i am sure roby will want to comment, but it is much like -- thank you very much. my reaction is it maybe we end up with a policy of contingents. i personally think it would work.

i do not think he should be our intended policy. there are better options. >> i think this is one of the arguments that the israelis have been making. it opens a door to a whole series of countries to -- turkey -- if you think the competition between turkey and iran is dead, you do not understand what the geopolitical dynamic has been for 500 years or maybe even longer than that. turkey, egypt, saudi arabia, all of them at least consider the nuclear option because none of them -- as a whole, they despise the iranians -- fuehrer the

iranians. the other thing is, it is impractical. i do not think that there is any way this administration or the next administration or any other administration can agree to that because they will be pummeled by the opposition. i think people are underestimating the obama administration because it has been far more aggressive in many ways than the bush administration was. for more aggressive. if you look at -- remember it was the republicans who castigated him for saying that if he found out of osama bin laden were in pakistan, he would go into pakistan and get him. what happened? i think people are assuming

that some how obama will be easier in the long term. i think they hope that somehow, the iranians will come around to the views that this is serious. i also think there is a realistic view that it is not likely and then we have that ignition point where we have to look at what would happen then. >> it is a very destabilizing situation not only because of proliferation, but because the israeli have been reduced to choosing between launch on warning or taking a big risk. i do not think they would want to take a big risk so they would launch on warning. this is one of the reasons i think there is a negotiated solution because when the iranians think about what the implications of their actual possessions of nuclear weapons would be, it would not be in

iran's interest. maybe i could ask the panel going in reverse order to make any final remarks if they would like. >> i am afraid that the path to meaningful arrangement, and do not kid yourself about the lack of conflict, it is the nature of the thing and it dates back -- i can give you example after example. i do not see that changing. i think going to a situation where you have a simmering conflict where people feel like they have to do something, the only path to convince the iranians that everybody is really serious may take a conflict.

it may take a conflict. >> i would like to go back to what we were talking about earlier which is that even if there is a conflict, i do not think that will resolve the issue. i think that the story is far from told. a lot of what happens with u.s.- iran relations will depend on what is happening in syria, what happens in bahrain, and i think that we are likely to see or have some sort of unintended consequences of the arab uprising in terms of our run's power in the area. >> my position is the common ground i cited. the primary goal has to be to stave off conflict. i think it would be devastating economically.

i do not think u.s. public wants another war in this part of the world. i do not think the countries want it. there has to be some option here. the primary job now is to stave off the conflict and then you think about how you can negotiate seriously and bring in a new american administration. >> let me just thank the staff of mei for their strong support for this event. thank you to the panel for a really good -- [applause] [captioning performed by national captioning institute] \ [captions copyright national cable satellite corp. 2012]

>> this year was the independent institute's 10 annual tobacco, alcohol, and firearms party. the group educate citizens and policymakers about personal and economic freedoms. here is a look at the events. >> what we see out of michael bloomberg and his crowd -- and their attempts to exploit the recent murders in aurora and wisconsin and really every day -- some people associate

violence with owning a firearm. this is hypocritical because when michael bloomberg says people should not have guns for protection, he has his fingers crossed. if you can get an entire security detail to carry machine guns and the company, that is ok because he is not personally owning a gun. they put out these terrible foibles against people like when they say the only reason a person would own a rifle is because they want to be a mass murderer. what a horrible thing to say about the millions of americans who have those rifles and what a malicious thing to say about our

police who frequently carry those rifles when they might need one for backup. neither the american regular civilians who use the guns for target shooting and a sense or hunting nor the police have those firearms because they want to harm a lot of people. they have them for legitimate purposes and especially to protect themselves and other people. >> watch the entire event witabt personal freedoms and gun rights today at 4:00 p.m. eastern here on c-span. mitt romney and his vice- presidential running mate will hold a town hall meeting tomorrow in new hampshire. this is mitt romney's 100 town

halls and running for president in the first time paul ryan has been in new hampshire since 2010 to promote his budget proposal. our coverage begins tomorrow at 10:30 a.m. on c-span. every club for years, the republican national convention adopt a new national platform. it is a statement of the party's position on a variety of issues. our coverage of the national convention platform committee meeting begins on monday at 1:30 a.m. from tampa, florida on c- span. additional defense spending cuts will result in the hollowing out of the national guard. according to paul mchale who served under the george w. bush administration. he said the national guard would lose 20,000 members if the additional spending cuts under sequestration go into effect. from the heritage foundation, this is an hour and a half.

>> good morning, welcome, everyone, to the heritage foundation. we welcome those joining us on our web site at on all these occasions and those joining us on the c-span network. we appreciate their attendance with us today. we remind everyone in how to make sure cell phone is have been turned off as we proceed. it will be appreciated if. will post a program on our website within 24 hours. our viewers are always welcome to send their comments and questions for the panel by e- mail. hosting our discussion this morning is steven bucci. is senior research fellow for defense and homeland security at our center for foreign policy studies. he looks at special operations and cybersecurity as well as defense support to civilian authority keith. he served america three decades

as an army special forces officer. in july, 2001, he assumed the duties of military assistant to defense secretary donald rumsfeld and worked daily with the secretary for five and a half years if. when he retired, the continued at the pentagon as deputy assistant secretary of defense, homeland defense, and american security affairs. immediately prior to joining us and heritage, he served as a lead consultant to ibm on cybersecurity policy. join me in welcoming my colleague steven bucci. [applause] >> good morning. we hope to have a lively discussion this morning. i have a couple quick plug before my introduction of our esteemed speakers. first, today is national emp awareness day. electromagnetic pulse. it came up in our discussion yesterday and is kind of nice

that this is part of our homeland security week discussion. electromagnetic pulse is something we need to worry about, because in a country like ours where everyone is connected electronically on a continuous basis, it would affect us. any of you who remember the blackberry outage we had last year for six hours and everybody in washington was in a panic, you can imagine what would happen if if we had an event where we lost all our capabilities in a city or maybe all over the east coast for a while. the other thing is today is the official rollout of this document. these are are two speakers in the suits. [applause] this paper, critical mismatch, the dangerous gap between rhetoric and readiness in dod civil support missions.

this is a critical issue. there is a problem with our capability to do our job, the job of the nation. this does not deal exclusively with the national guard, but the national guard is a huge part of this and need to be. hopefully, our speakers will touch on that a a bit this morning. this is available outside and we hope everyone will share it. it is an issue that affects each of you. if you are at ground zero when something happens, you will want this nation to have the capability to respond properly and expeditiously. right now there is some debate as to whether we have that capability or not. our subject for this morning is the price every state will have to pay: the effect of sequestration on the national guard.

i never served in the national guard. i spent 28 years in active duty in the united states army. but i had the opportunity numerous times to work with the national guard. as i became the deputy assistant secretary of defense for homeland defense i got to work with them pretty much every day. i have to tell you, if you don't understand what the national guard, army, and air guard, what they do for this country, you are missing something, because those men and women are heroes for this country. they are the lineal descendants of the minutemen. that is in their simple and it's very appropriate, because they are regular citizens. are not just weekend warriors. they are people who have real jobs in our communities. and then when the call is given, they put down that plow or whatever they do and then pick up a musket and they are ready to help their fellow citizens and most of the time at

great personal sacrifice. these folks are important. i cannot think of canada better people to discuss this with you than are two speakers. the first is paul mchale, president of civil support international, a consulting firm in washington. paul was my boss at the department of defense. >> can you say that again? >> my boss. [laughter] only two people are still referred to as boss. that is secretary mckale and secretary donald rumsfeld. they are two gentlemen that i hold in high esteem, not just because of what they have done and who they are, but because i have seen them at work and i have seen their dedication to this nation. secretary paul mchale is a former congressman from the state of pennsylvania.

he served on numerous positions and the most relevant to this is the was the co-founder of the national guard and reserve components caucus in the house. he came to work at the pentagon. i will be honest, i was the military assistance to the secretary of defense at the time and i said, a former congressman, this could be painful. as it turns out, he is an incredible gentleman, easy to work with. easy to work for. he wants you to perform properly. the happiest i ever saw him was when he recruited me to come work for him and then shook hands and said i will see you in about six months, i'm going off to put on my marine uniform and he went back to afghanistan. already retired from the marine corps reserve, recalled to duty so he could serve as an adviser

to the minister in the afghan regime. he was so happy to be a marine again. they never stop being marines. he served there with great distinction and then came back and continued being my boss. his dedication to the national guard is not just professional. he also found a beautiful woman who is a national guard general, who he then married. where is martha? that's his lovely bride. from vermont. next to him as the gentleman that he was joined at the hip with the whole time we were there in the building, lieutenant general retired h. steven blum. the whole time i knew steve, he was the director of the national guard bureau, not a very glamorous, but a very critical

job. he later became the deputy commander of u.s. northern command, the first national guard officer ever to serve in that position. steve is also a special forces officer, which i kind of like, because i was too. he has served pretty much in every position you can have in the national guard. he is a man of infinite imagination, infinite energy, and vision. even before the rest of the department of defense started getting ahold of the issue of chemical, biological, radiological, nuclear, and high yield explosives response, he was the one who picked up the gauntlet and said the guard can contribute to this and the guards will contribute to this. he made to the guard a critical cog in that responsibility. these two gentlemen fought that battle against a lot of naysayers and achieves quite a bit during their tenure.

i will let you read paul's paper to get the status of it now, which is not quite as good as it was when they left office, but these two gentlemen i am proud to call both of them friends. they are personal heroes for me, because i have seen the work they have done for this nation, not for self aggrandizement and definitely not for money but for the sake of this nation. i would ask you to join me in welcoming paul and steve. i will give each about 10 or 15 minutes to make opening remarks. and then we will go into question and answer. i will tell you, as i call on you to ask a question, if by the end of the second sentence i don't hear? , i will ask you to stop. -- if i don't hear a question mark, i will ask you to stop. we will start with paul. [applause]

>> steve, thank you very much for your kind words. i truly don't think of myself as your boss. i think of you as my friend and colleague. i was honored to serve by your side during 3 or four years of pentagon service. general blum, my good friend, and my wife, the general as well. and the colonel just back from afghanistan, sir, thank you for your service. [applause] ladies and gentlemen, there was a very fine article in "politico" yesterday in which secretary of defense leon panetta was quoted.

"i realize there are a lot of other things going on in this country that can draw our attention, from the olympics to political campaigns to drought to some tragedies we have seen in communities around the country. i thought it was important to remind the american people that there is a war going on." the only thing worse than the fog legislative strategy of sequestration would be its actual implementation. with military men and women in daily combat, 41 were killed last month, says secretary panetta. it is a deep breach of trust to put the department of defense on automatic pilot. across-the-board cuts in d.o.t. funding would severely jeopardize the operational capabilities of our active

forces, sent a message of u.s. defense vulnerability to our adversaries, and irresponsibly weaken the national guard in its ability to protect the u.s. homeland." because the sequestration cuts, totaling approximately $500 billion over 10 years are across the board, it's difficult to determine precise with the impact. but a substantial reduction in military personnel is a near certainty. recently it was reported by the chairman of the house armed services committee and secretary leon panetta on july 25 when buck said, "we have 100,000 leaving the military." it's expected there will be a

reduction of 100,000 personnel coming aboard donnelly from the army is what he's saying, as a result of cuts that have already been approved. then he went on to address sequestration. he said, "if we will have another 100,000 if sequestration takes effect." in response, secretary panetta said, "it would obviously add another 100,000 that would have to be reduced." there is uncertainty as to what the impact of that reduction of an additional 100,000 would have on the structure and strength of the national guard. some insight into that was provided on may 17. that was when ray odierno, once the special assistant to the chairman on homeland defense

issues. he and i worked together on a daily basis. i have extremely high regard for him and his professionalism. he provided some insight into how that 100,000 production in end strength would impact the national guard when he said, "if we have sequestration, it will affect the reserve component and the active. it depends on what the balance we picked. what i talk about a lot is 70,000 out of the active component, 30,000 out of the reserve. the army could be reduced anywhere be 400,000 to 425,000 soldiers. the national guard might lose an additional 20,000 soldiers. the army reserve might lose an additional 10,000. additional 10,000.