>> the leaders are critical to this. let's play this out with clinton. at the end of his presidency, he made a declaration that america is a diverse and multi- cultural country. we are at a competitive edge tentative country. our advantage in the world is that we are competitive and more diverse. i work all across the world and i worked across europe. if you say you're a multi- cultural company anywhere in europe, you are out. you cannot mention multi- cultural. what that did was bring over not just the minorities themselves, but more educated, more cosmopolitan, -- these and not the only issues they are voting on, but it is their world view. we made the decision -- we new

welfare were form was the issue with clinton. we ran welfare in the primary in georgia on purpose so that no one could say after the general election the the reason we were running welfare reform and was to get the white vote. we could win african-americans on welfare reform in the primary. >> as an implication of that today, how tough it before republican? -- how tough would it be for a republican? >> it would be impossible to get it off the table. >> my friend jonathan martin

said yesterday that any potential 2016 nominee will be intimidated from joining a comprehensive immigration solution because the likelihood that at least 12 candidates will go into iowa and new hampshire in 2016 and ran on repealing obama's amnesty -- you have the catch-22 that the future never gets a vote in the room. the existing coalition were white. over 60% were over 50. groups that are uneasy with a lot of what is happening demographically, how much leeway do you think republicans have? if you're a republican leader, how much risk would there be in moving out in front? lot don't think there is a of risk, frankly.

in the primeval -- in the primary this year, immigration reform did not raise an issue for republican voters. i do not understand why these candidates were moving farther and farther to the right. every exit poll, 3% of the voters had immigration. those voters are not really scared of immigrants. they would vote republican anyway. they can get through the primary. they just have to settle down there and visors and say that we will run this type of campaign. i think that candidate can be successful. >> hispanic voters are less than the activist camp than african-americans. certainly, there is a lot of support for health care reform.

but what to do about health care reform, leaded or expanded, repeal it summerall? -- leave it, expand it, repeal it some or all? among whites, basically 60% said repeal. 75% of african-americans said to leave it or expand it. when you look at the core issues, lifting people to the middle class and headed do it -- education, health care, training -- what are the challenges each one face? >> immigration is by far not the dominant issue. it is not the only issue on the agenda for voters. it is an issue that creates a lot of the possible rhetoric so you get evaluated on it. but on these other issues, on health care, and overwhelming majority of hispanics voted on

that. an overwhelming majority of them said that taxing the wealthy was a majority of that. there are other issues on the economy. 70% to 20% said that they trusted the economy. that should not be their goal. their goal should be to hit the 40% level that w. was able to do. that will make them competitive. and they need to also created goal for blacks. they cannot conceive 97% of the black vote. start with 12%, 17%, something. they need to make inroads. is unrealistic to say let's go for hispanics. if they can get to the 38% range, they can be competitive. in the same way, we're talking

about the democratic problem with whites. >> in 2013, there is a big deal. comprehensive immigration reform was taken off the table. how far does this get you with this next emerging electorate? what else does the party have to do to get back to the kind of numbers that bush saw? >> is a step in the right direction, but it is far from the whole thing. it is basically ronald reagan mindset that says we welcome anyone who shares our values and our desire for lower taxes. bill back and listen to some of ronald reagan's rhetoric. -- go back and listen to some of ronald reagan's rhetoric. in his farewell address, he talked about the shining city on the hill. if you had to have walls, the

the walls have gates. you have not heard a lot of rhetoric like that from republicans. that is ronald reagan. that is the guy that builds the majority. if we can get back to the regan mentalitythat we welcome all regardless of what you look like, who share our values. we will get back and we will get back quickly. bush got 44% of the latino vote because he tried. we are not that far away from being of the level of being competitive with the right leaders. we have to have the right leaders. >> and in terms of the immediate issue of immigration reform, they blanked on it for fear of legislators from heavily blue-collar distress and hedging economic advance -- blue-collar leaders and hedging economic events. they have to be able to deliver

tangible uplift and improvement for this coalition in order to hold it together. >> it needs to deliver for america. it is a function of the number one issue of the election, which is the economy. howe we are going to grow it and what will happen to the middle class. we had the good fortune to run this time against the republican party and a republican candidate that was out of touch with ordinary voters, that was hostile on immigration and denying the right to vote and denying signs and whatever. but what voters mainly wanted him to address was the short and long term problems of the economy, which means how to raise income and what the future

of the middle class is. that is what the white voters are looking for. that your world view is mainly focused on meeting the obligations of commitments made. that was you should recruit romney and mccain. negotiate a deal with the chamber of commerce? if i were them, i would get it out of the way. and then you can set of economic issue and you have a much greater challenge. the president knows how he will raise income and create jobs. that's the first thing to deliver on. >> let's not underestimate the challenge the president faces.

the election yesterday was 50- 48. the president managed to get less than 40% support from the largest group. he leads a very divided country and he helped make the divide by the way he ran the campaign. it is incumbent on this president to reach out, to show ogling is to expand his coalition, to be flexible with some of his policy options, and only he can do. . no one else other than this president can get beyond this incredible divisiveness. >> as of right now, his margin of victory is the smallest ever for it successfully reelected president as a share of the popular rovote. >> that won't remain. >> but he is the first president

since andrew jackson to be reelected with a smaller share of the popular vote than the first time. >> thanks for this panel. i want to pick it off something you were saying about science- based relative. the october surprise was hurricane sandy, with the bloomberg endorsement, christie, a bipartisan appeal, etc. on the right, you see them looking over their shoulder in terror of being taken on in primaries. yesterday four of the five members in congress targeted by the leak of co conservation went down in defeat. they were targeted for taking

anti-science positions and independent districts. is the ice stunning to melt and break up in the republican party owith this reign of terror of the no-nothing wing of climate science? is there an opening for the administration to go more boldly on climate? >> is sandy a turning point? >> the whole discussion of climate change has become so polarized that i think that if we can address some of our economic challenges, if we can address some of our immigration challenges, there are things that are a whole lot higher on the priority list and trying to overcome the divine on that. eventually the progress of science will be persuasive to more and more people. but right now it has become so divisive that i wouldn't look for any sort of immediate

rapprochement on that particular issue. >> i wonder if this could be an event like the santa barbara oil spill, galvanizing, changing the debate in an important way. >> i think there are more opportunities at there. but i think the, it reflects something about the republican party, which goes back to immigration issues. there is something about the dynamics of the republican party in the primaries that romney thought he could survive by positioning himself to the right and ultimately win by being as far right as possible on immigration. that is the first issue you chose not to move to the center on and did not move in the debates when he did move center on other issues. he felt he could not do it. i wonder, given christie's

position in this, and cuomo's speech, that it is not a question of the science but just managing the consequences, maybe we can find a basis for acting. on the rubric of energy, there's a lot that obama wants to do on energy -- natural gas, etc., addressing climate change in the process -- it may be pragmatic in the context of this crisis and there may be movement. >> this question is for matt. as we see the latino population getting bigger, more affluent, more politically involved, and also the culturally based, normally socially conservative family, opening the gates up for everyone as long as they have equal opportunity -- if

there is a legitimate latino candidate in the future, the reciprocal, will they be able to coalesce with the african- american vote just as president obama has taken the coalition of both latinos and african- americans -- would a hispanic be able to do the same thing? >> there is a lot of similarities. when you look at congressional candidates that are out there that represent black and latino , they are doing that our reach, and there are similarities. we sometimes see disagreements in primaries, but in general, there is usually overwhelming support, and we're starting to see more latino candidates emerging, and to do that, they'd know that they need to build good strong relationships with the african-american community.

but there are those on the horizon. one quick thing on the republican side -- one of the republicans that did the best with latinos was ted cruz. he did not win the latino vote, but he got 35%, a lot better than mitt romney did. part of it is that they are making more authentic efforts. it is very poor to ta very -- important to talk about candidates. >> would be your bed, and the odds of an elected a candidate on either party's ticket in 2016? >> good. >> for both? >> i don't know about both, put particularly on the republican side. >> republican side is better.

>> in the back. keep going back there. >> it is typical for candidates to pivot towards the center after their respective primaries. can you distinguish the difference between pivoting and the creativity that mitt romney used in terms of "i didn't say i was going to raise your taxes, i didn't say 'let detroit go can you see- candidates in the future being that creative? [laughter] >> pass that one -- i will pass on that. >> also, the severity of it was

intense on some of these issues, but in the context of our conversation, i am struck on the immigration thing how little of that occurred. the second debate, he used the word "magnet" and "amnesty." he doubled down, after softening in the fall with univision and so forth -- he reaffirmed that the signal. >> and he got in so much trouble with his idiotic "self- deport" comments that he re expanded in the debate. "we will make it so hard for you to live here that you will want to go home." >> if we have a quick question, yes, and then we will wrap up. >> thank you.

what impact do you think the election will have on what has amounted to an endangered species, the moderate republican and moderate democrat? >> who? [laughter] it is interesting, the continued hollowing out of the center in congress, especially as you see the kind of split ticket voting in many states, where all the what is the trend line you are seeing for more centrist legislators? >> not particularly good, particularly in the house. in the senate today, the greatest threat to a democratic senator in most states is the run to the left and the greatest threat to republican senators is be run to the ri -- run from

the right in the primary. it will take a leader who is willing to bridge those differences, and the president is the only one who can do that. >> this is not symmetric problem. is an asymmetric problem. look at what happened in the u.s. senate across the country yesterday. how was it that in these very republican states -- montana, north dakota, indiana -- with big votes for romney, they were speeding tickets and voting for what was probably described as -- splitting tickets and a voting for what was probably described as moderate? we have a diverse party. now in the statewide races -- the same kinds of issues exist when you deal with the house.

but on the democratic side, it has been driving towards ideological diversity. the opposite is true on the republican side. >> we got to finish -- it was striking yesterday that all the candidates succeeded in getting crossover support, missouri, indiana, montana, and if you look at the states that obama won -- virginia, ohio, connecticut, wisconsin -- there was 90-plus correlation of the vote in those cases di. >> but the blue dog democrats and the house are gone, and this house democratic caucus is going to be far more liberal than the last caucus. >> as our colleague david wasserman was the first to point out, this will be the first time in history that the majority of

house democrats will not be white man. well, this has been a great panel. thank you so much for joining us, whit and stan and matt, and we will talk about the economic policy implications of where we are. >> august returns to washington next week, and now we preview the commercial agenda in the land and the relationship with president obama. panelists include a former labor secretary elaine chao and president of the center for american progress, neera tanden. this is half an hour. >> see you again. all right. jared is over there.

let me just real quickly -- elaine chao, now at the heritage foundation, is a former secretary of labor. alex brill, senior fellow at the american enterprise institute. neera tanden is the president of the center for american progress, formerly chief policy adviser for hillary clinton and a 2008 and 2016 -- sorry. [laughter] jared bernstein is a senior fellow at the center on budget and policy priorities, former chief economic adviser to joe biden and in 2000 and 20 -- no, sorry. we should have separated you two, actually. >> today is a day for half the purpose of the families. >> -- happy progress of

families. >> we have to start with the big question. obviously, we are in a position where the country is sent back a democratic president, republican house, and a large, potentially by two seats, democratic majority in the senate. when you look at that new configuration and the incredible agglomeration of the school choice is barreling down on us, what is that when imports at this point? -- what is that pointing towards at this point? does this make some kind of deal more or less likely, the alignment of voters? >> it makes the deal a little bit more likely, which is not as likely as i would like it to be. but by "deal," i don't mean this gets resolved by january 1 hit by the way, i saw the market is taking today, which is an

unfortunate thing. it is like they were expecting a different outcome than what the numbers suggested -- >> polls in october. >> they are suppose to be numbers guys, but put that aside. this is beginning to take shape and it could be a viable during the lame duck. it does not have to pass during the lame duck to avoid the recessionary contraction that is imbedded in the fiscal cliff. we talk about it more as a fiscal slope. if you turn around quickly or maybe a fiscal bungee jump, i don't think it will be recessionary. look, i am not sure about this. i am still digesting this like everybody else -- i'm way over- tired.

it seems to me that a newly reelected president, or a new president, for that matter, gets most o-- stuff that he or she wants than someone who was 12 with the kind of instruction error -- toiled the kinds of obstructionism we've seen. i am confident that there will be enough grown-ups and the room to do enough on the spending side -- $1.70 trillion of cuts on the books over the next 10 years have already been scored and have been passed and legislated -- and some new revenues. >> elaine, after this election, can you foresee a a circumstance where republicans in the house accept a net increase in revenue? >> the republicans have already made that overture during the fiscal committee. it was not herald the very much by the press or even with the most conservative representative on that

committee. the republicans made an offer to increase revenues, and at that time it was not accepted. that is a very important point. i have been through administrations, congratulations to the other side for winning. the american people have spoken. but the second term as hard, and lots of unexpected surprises pop up. governing is hard. this president has been campaigning for the last 18 months. i think the fiscal cliff was always going to be addressed, but the results of the election would havergin - determined the complexion of the deal going forward. if romney had won, republicans ha -- house and senate had a clean republican sweep, there would've been a short-term solution and gone home.

now that they have the presidency and the senate, i think that is much more incentive for the democrats to take a more thoughtful point of view. >> alex, what do you see? pointill pick up jared's as the fiscal cliff as a short- term versus long-term scenario. we will not see a lot in the next few weeks other than perhaps the beginning of a framework of a deal. i agree with secretary chao that the democrats have more incentive to be engaged in how that process plays out in 2013. before yesterday there has been chatter about how a lame duck deal could be structured that not only moved the deadline of the fiscal cliff, which is a really boring policy outcome, but sets forth that path for resolving some of these issues.

to the question of whether revenue is going to be part of that solution, i agree. the key for republicans is the rates themselves, not moreover than the dollars themselves. at the moment, in this past debate and the president's budget, both parties have a fight about what the marginal or statutory rate. there are ways to get more revenue in. >> the president ran as explicitly as any candidate ever on taxes for the top, and he waon. how strong a position is he going to be in? >> i think tying this to the previous conversation, it was u

npresident did that attended it ran on raising taxes on wealthy americans. the president spoke about it on the stump, and it was in iowa that he focused on these issues. i was actually an issue that was important to the coalition that elected him. still significant portion of the vote in ohio, as well as african-american latinos. and white women. it is not just a promise made. the challenge for the conversation in washington --

the republican party is in an odd position, because their position is not do the thing that is the most popular item to do, but to tax everybody and some other group of people. it is a very popular thing to do. if anything, we have a grand bargain that moves away from the politically popular thing to do to the more difficult things to do. as a progressive, i am not sure why the president would want to do this. why give on issues like taxes when all the republicans will ask him to do is something that is less popular on taxes? >> the public is concerned about taxes. do you see him signing an extension of the bush tax cuts

for all earners? >> i find it extremely hard to see. i agree with neera. what i think i hear alex and the secretary saying -- correct me if i'm wrong -- something that is very popular, tax reform, which is that, yes, we need a new revenue and we are willing to bring in revenue to the table, but it has got to be broad based and not from increasing their rates. the problem there -- it is like mitt romney's math problem. you cannot get the revenue you need just on the 250-plus folks. you have to go below that -- >> in terms of narrowing exemptions. >> raising taxes on "the middle class," households under $250,000, which happens to be 90% of all households -- i am not sure that formulation works.

this is a great economic argument -- i am not nearly as obsessive as the economic impact of going from the top rate -- basically resetting to the clinton years, where not only did poverty fall steeply but we had a budget surplus. broaden the base, lower the rates -- in this climate, you get a tiny broader base and tiny lower rates and it is not going to work. >> on the base broadening question, one of the things on the president's budget is a base-broadening proposal -- >> raises $500 billion over 10 years. >> doesn't lower the rates. >> but the framework of having a base-broadening -- how you get there -- i was asking the

question, would the republicans accept revenue? you are asking if they would enough revenue -- >> to stabilize the issue. >> i think the president's math is faulty as well. even if you tax "rich people" in the country, that will not close the deficit. this country is still very divided. it was not a clear mandate, and the turnout was quite low -- enthusiasm. >> we are very closely divided at this point and you have the president standing here and the house republican starting here,

what is the place that you can envision -- >> we don't know, because the president has not stepped up to take leadership to he has been campaigning for 18 months, with a note to disrespect. -- no due disrespect. people on the hill are looking for leadership. >> just be fair, he has a budget proposal. he put forth a budget proposal, it did a speech on a, it is in his budget. it gets $4 trillion in deficit reduction. >> paid for the sequester. >> the idea that he has been out campaigning -- >> he has to bring members along. he is the only member of his party -- >> the critical question -- >> in some ways --

>> the republicans' offer was not accepted, let's not forget that. >> we are in reality where, without the president's signature, the tax cuts will expire. what will the response be of the congressional republicans -- >> we will see what happens to double the lame-duck session. the electorate is very divided. unless the president tacks to the mill, we will be faced with a horrible scenario. when wall street drops, it is not just companies that are suffering big is people interested in companies -- invested in wall street --

>> wall street has done very well -- >> i'm talking about pensions. the overall quality of life -- >> let me move on -- >> very basic point. >> the fiscal cliff is important i washington for good reason, but in the country, all these issues -- can you see any scenario where the two parties may be able to agree -- work force, education -- basically, equipping people to get ahead faster than we have seen -- is there any place where we've seen initiatives from the president or congressional republicans and where they might

converge? >> look, i've actually optimistic. this does not sound optimistic, but i want to sound optimistic. i came to washington in 1997. president clinton had been reelected, and he did not have a senate, and he did not have an expanded democratic majority in the senate. the president has said this before, but people had tried to defeat president clinton, it failed, and they recognized it was in their interest to get things done. over the last couple of years, we have seen that people have been very focused on the presidential election, but republicans up leaders on -- have been leaders on education

reform, senator landrieu had a workforce on education -- you had republican leaders, lamar alexander. there are areas like renewable energy where republicans in the past have supported proposals that the president did, too. there has been punishment of bipartisanship the past two years, and is that punishment lifting? do the republicans worry about facing tea party opponents? or do they say -- i am hopeful about senators like senator alexander, because they may realize there is not up point to coming to washington -- >> the romney proposal on individual development accounts and training got a lot of praise across party lines -- >> community colleges -- >> are there areas where they

might be -- >> on job training, of course, but not spending money like the jobs bill president obama wanted, $8 billion, $23 billion already on a jobs program scattered throughout the whole federal government that really should be challenged to there needs to be necessary reforms to improve job training so that people who are unemployed can get the relevant training, and when they graduate, they can get real jobs. let me go back to neera's point. i think divided government is an excellent opportunity to tackle the really, really important issues in our country. at the largest issue that we have are the spending. we are going to lose potentially our rating as a nation because of our irresponsible deficit spending. if the two parties can get together at tackle the whole

issue of entitlement spending, we would be contribute and a great deal to our country. >> i want to follow up that question and ask neera real quick -- john boehner expressed openness to reductions in spending, reforms, but not structural changes, not ending the federal entitlement to medicare or medicaid, as the ryan budget would do. where do you think that goes after the election? >> i think the president really crossed the rubicon there by putting medicare and medicaid on the table. neera mentioned the budget -- hundreds of billions of dollars in cuts. romney tried to put it back in. i thought it was very ironic. social security? no, it has not been on the

table. i think he has already done so and i suspect he will continue to. >> one of the interesting things about that -- we will go to the audience in a minute -- think of the context. medicare is one of the policies that transfers resources down the generational ladder. from the retiring baby boom that is 80% white and moving it into an uninsured younger population, it really in many ways -- the federal government has $700 per capita, something like that -- is striking that under such explicit attack, for kind of rebalancing that i think you are getting at as well, the amount we are spending for these entitlements of the elderly -- >> i think that is a very interesting and insightful way to look at $716 billion, as really almost a redistributional transfer of health care from young people to the elderly.

>> that was part of the attack -- >> yes. >> the money was going to be saved -- >> no, no, no -- >> cuts to fund obamacare. that is exactly what it was supposed to do. >> the effect was to move resources from seniors to the uninsured people, moving down the generational ladder at a time that the federal government spends 700 less per capita on seniors. we almost never do that in

public policy, shift resources from seniors -- >> the reason -- one of the reasons why that happened, that there was a coalition behind, is that some of the resources went back into -- coverage of the -- >> eight more years of solvency. >> luck, i think -- >> rebalancing? >> i would say that the president's policies were attack on the point of redistribution. whether romney made those attacks to get some support for his coalition versus another, i cannot speak to. i think the president's coalition -- >> more accurate to say that the president offset those attacks. the attacks worked. he was just able to overcome that because he got enormous margins among the people -- >> that is entirely true. >> would benefit from this.

the democrats are laying down the tracks to prevent cuts to programs and in the process for changing -- >> no, but -- i think this is an important question. the issues on health care, cap support deductions and health care, medicare, etc. -- the president was very specific about beneficiaries, and those beneficiaries in the future -- >> is there a generational -- when you see this through the generational lens of appeal to a population that is 80% white -- what do you think of the debt issues?

how does the generational lens applied to this question of the fiscal consolidation? some said that paul ryan is saying we are going to leave medicare the way it is -- >> that is more interesting than the specific transfer, because i'm not a sure that the transfer is ultimately sustainable. it makes the math work -- >> more sustainable today than -- [laughter] >> there is certainly far more interested in the broader question of the debt burden. i think it is question that all economists are worried about, this debt-to-gdp ratio and. in the generational context as well. at the people are much more aware after years of a trillion

dollar deficits than they were four or five years ago -- >> it is not the generational issue, because young people voted overwhelmingly for -- >> you are basically saying, are we saying to them, you are going to have to bear the burden of all the consolidation and we are going to exempt ourselves from it, because in the right version, for example, nothing really happens for 10 years. we put more money back in for seniors. generationally, does that work? >> there is the time value of money, and if you start a program with a far enough horizon for younger people, there is time to make up the difference. that is the purpose of having that delineation. the other think i would say is,

you know, i don't think it is the penalty. with a divided government, there is an opportunity to take on these hard issues. both sides are going to be blamed for taking on an unpopular positions. we saw that in 1986, with the tax to between tip o'neill and ronald reagan. i think divided government is an excellent opportunity to tackle some -- >> do we have some questions out here? do we have some questions in the audience? i think we are -- >> we have answered everything. >> while we are finding questions, this is what i wanted to file away from what secretary chao is saying -- there was a point in the clinton administration were he was able to say to democratic constituencies, who were resisting various kinds of reform and retrenchment, "hey, if it was up to me, i would not

be doing this, but i have these crazy republicans on the hill and therefore i have to --" in other words, would it be easier for president obama to sell democrats are reforming medicare and medicaid and job training programs if, in fact, he has the ability to say, "look, the republicans made me do it"? >> in 1997 there was a budget deal. there was a lot of savings in medicare to basically fund that budget deal, and democrats have resisted that. it is not that you cannot find compromise. the question is, it has to be an honorable compromise. i guess my view of this is, to me personally, i would find it a little depressing if our entire debate after republicans lost seats in the house -- still have the majority but lost some seats. democrats expanded their majority in the senate, which

nobody expected. if you had said a year ago that democrats would expand their majority, people would have literally said, "you are crazy." and the president was reelected and basically swept the swing states. we may be divided -- >> but there is a tilt. >> in my view, there is a progressive majority for governance. to go with the same policies that he had a year and half ago with boehner would be a disappointment to people who worked very hard to elect him. if he takes that debate to the country like he did with payroll taxes, more and more people -- >> let me ask a final question and i will start here and go down the line. if we say that the principal economic concern of the public is the decline of economics security and mobility, the crisis we've been living through in various permutations for decades, and it is not clear

how much leverage we have to really change this -- if you are going to say what are the two or three things public policy to do to increase the odds of more americans ascending the economic ladder in their lifetime, what are the two or three things you think at doing to increase the chances of americans moving up? >> we have to preserve and keep opportunity. that means having a vibrant free enterprise system that will promote opportunity, and it too heavy regulatory and government hand will limit that. bill clinton had his best triumph during 1997 to 2000. of course he had a republican -- no, no, nafta -- trade liberalization is basically gone. it is to the president's own

benefit, for his own legacy, if he tacks to the middle and results these big issues. it will disappoint his base, the republicans will disappoint their base pay but for his own legacy, it is better for him to tack to the center. >> when we see the income gaps showing up in the data, we have to look very closely at the education gaps. whether it is a federal issue or state issue or both, one can debate, but there is a serious crisis in terms of the outcome and disparity of educational attainment. i think another one is the tax code. going back to what you are asking earlier, are we going to have a fight over the progressivity of the tax code or reforming the tax code on a revenue-neutral basis? we like the code the way it is, we just want to make a progressive -- is there a way to blend those issues and have a code that is more efficient, more pro-growth?

it might make the economy grow a little bit. >> the 2 or 3 things help the economy get ahead, neera. >> immigration reform. it does depress wages that you have millions of people undocumented. if you move people out of that status, that will have a

positive benefit not just to people, but to wages being depressed. equity is a critical issue. we face a significant challenge -- in the short-term, medium- term, and long term, there is so much inequity in education. it is not something that the political process likes to discuss, but it is one in which we need to think more creatively about how -- it is not good for us in the medium or long-term. >> nice to go last on this because i can think. [laughter] a really high-quality pre-k -- >> i agree. >> education for kids at the

bottom of the income scale. this is supported by conservatives and liberals alike. a nobel-laureate economist who i think is associated with republicans has written eloquently about how critically important -- and there has got to be a significant government role. it will not happen without. and this is offbeat, but full employment. during my lifetime, the only time i've seen conditions improve is when the unemployment rate was 4 or below. i don't think that left to its own devices, even with economy better than the current one -- by the way, we have a lot of infrastructure problems. we could marry a problem of infrastructure repairs in the public sector, and high

unemployment -- >> this has been a great pair of panels thinking about the policy implications of the changing electorate that was vividly on display last night. you have been a terrific and -- what's the word -- endurance in this audience. [laughter] >> join me in thanking our distinguished panelists. [applause] i would like to thank the underwriters were able to bring >> tomorrow, they will talk about childhood and young the torcs in their programming ucla. our coverage begins at 1:00 p.m. eastern followed by a speech on foreign policy. this'll be his third time speaking since becoming prime minister. then later, be no rennae talks

about social enterprise. -- bono talks about social and a price. host: we want to welcome the former lieutenant governor of maryland michael steele welcome back to c-span. what happened tuesday guest: i think from the democrats perspective they got an affirmation of the policies and the direction that the president articulated. as a i would say there wasn't much articulation there but they showed they are spoir in getting their vote to the table and with the pick up in the senate i think a lot of people kind of looked at the senate as one of those fire walls that the republicans needed to pick up two seats was a profound effort as well. and it really makes the policy

discussion take on a very different hugh than it otherwise would. and i think for the republicans it was one of those come to jesus 340e789s politically where they have to reassess and evaluate whether they want to be a relevant political party going forward. host: how do they do that? guest: they have to get out of the mind set they've been stuck in and i think for two bright shining years you can prove you can win coming off the ash heeps of 2006 and 2008 the brand is in the bank. the money is nowhere to be found. we were able to turn around by enabling the parties to build a

grass roots game on the ground. i mod led my chairmanship politically how we operated with a 50 state strategy putting emphasis on states where republicans had not won in the past to win some. win a county council's race or state legislature race and build that from the bottom up. to have a message that resonated with folks and a lot of that was missing in this campaign for a lot of reasons. all the finger pointing is not helpful. second guessing should we have picked mitt romney, well you did. should he have picked paul ryan? absolutely, he's a smart political figure and has a lot to offer the party and resonated well with the electorate. so all of that second guessing is typical washington inside craziness. you need to hunker down and look at your ground game and your organization and your message and messengers. we need messengers who look like me. we need messengers who are hispanic, asian american, women

cross section of folks who represent communities all across the country. host: your successor of the republican national committee may seek a second term as chair of the party. what are you hearing? guest: i've heard people say that and that's a decision he will make on his own. and the party will judge whether losing two senate seats and the presidential and not much of a ground game is worthy of a reelection. host: a landslide loss for big money. voters ignored most of the outside ads but the danger of unlimited spending remains and a lot of focus on american cross roads and the money spent by carl rove. those people should ask for a refund guest: good luck with that.

the return on investment was not the best that it could or should have been no doubt. i don't know that's something that cross roads and their donors will have to work out. many of those donors were moved away from the r.n.c. and that may have had an impact on the effective ground game. they adopted strategies that a lot of people looked at and questioned whether or not they would work. it was more of a beached what he will than anything else. i think there were a number of aspects of this where money and i think this election showed that despite all the hype and hysteria at the beginning of the campaign about super pacs and big money, at the end of the day had very little impact in terms of getting people to vote one way or the other. a lot of networks and tv programmers had a very lucrative spring, summer and fall but beyond that i don't

think much else happened with it. host: from the weekly standard four more years and losing can be liberating. he points out that conservatives have a role to play guest: there is some truth to. that i think whenever you get into battle you're consumed by it, that's your focus. the fact of the matter is have you every expectation going in you're going to win. when you don't it takes your breath away and you have to step back. what i learned in 2009 with very little to work with and go on simply because the brand was not what it was before that was you sit down, you lay out your mission and you engage at a level that you hadn't gone

before. you really drill down and understand exactly what is going on. and what we did was almost like a 12 stefment we assessed our failings, we listened to what people were saying. we looked at the landscape to see how the changed and how we needed to adapt. and that's the same type of strategy that needs to go on now. if you want to moan and point fingers you can do that but you're not going to get to solving your problems. host: last week saying there were mixed messages and when you do that when you send -- didn't resonate with most voters because what -- how we came off and sounded was judge mental and really unwelcoming to people. ofan't tell you the number

people who would come up to me at a local store and say i would like to be with you guys but i'm not feeling the love. at a real base level that's what people look for in their political party. they want to feel some level of connection and acceptance, i'm not going to agree with everything or you may not do everything i want you to do but there has to be a connection there. and that was important for to us re-establish early on. when you look at a state like new jersey with chris christie running for governor in 2009.

how do you climb that mountain and yet you find with a good candidate like christy a strong message and he focused on what people were concerned about their taxes, the spending in the state and it resonated. he didn't get caught in the weeds of issues that people weren't focused on. that was a trap that was set. we fall into it every time. we feel if we don't talk about these issues people won't know what we believe. people know what we believe whether it's abortion or gay marriage, family issues and the like. people know that. if people are talking about this over here the economy and jobs, then let's focus on the economy and jobs. it doesn't mean don't focus on the other issues. focus on what people want to talk about. explain how your policies and your leaders will make a different for them. host: was mitt romney the problem for them? guest: no. mitt romney went through that primary process like everybody

else and state after state republicans voted for him. if they didn't want mitt romney to be that i shall nominee why did they vote for him? only so you can get to the general election and trash him when he loses. that seems stupid to me. so to say mitt romney was the problem. if problem if you're going to point to it is the republicans out here who said this is the guy we want and didn't support him. this is the guy we want but didn't help him get across the line. you can't put this on the shoulder of mitt romney necessarily. how he runs his campaign you can pick at that from here to . there but to say as the nominee he was the problem i think is silly particularly given all the other individuals who were in the race that ran through the primary like he did. he won. host: we'll get to your calls and comments.

join us on our facebook page or send us an e-mail or tweet. let's turn to the policy side of this speaker boehner telling the republicans to basically fall in line. he said let john boehner be john boehner he can negotiate a deal with the president without getting pressure from tea party caucus members. guest: i agree. let john boehner be in a position to negotiate from a position of strength not from a position of looking over his shoulder and having to second guess and ultimately a position of weakness going into these talks with the president. the spt emboldened and he could say john boehner i don't need you and if you keep this i'm going to run against your entire congress and all of you are going to be gone. he's looking at the longer ball as well.

you have all these house members who will be in their fourth year by the time they get to 2014 and if there has been no movement. if the country perceives republicans are not working trying to resolve the problems, then guess what happens in two years. the public will turn and say that's it. we're just going to go in a completely different direction. so boehner needs the short term and long term opportunity to position the party on policy so that they can art cue late what we believe whether it's on taxes or a whole bunch of other issues from a position of strength not weakness and i think the house caucus should listen to his leadership. the man knows what he needs to do and how to do it. he's done it before.

so let boehner be boehner. host: the tax code, changes to the overall tax code next year. how likely is that? guest: i think it's likely. it won't be immediate. you want to get it right as you possibly can but that's a leverage point for john boehner. latestot focus on the rates, we know there are all these other areas where we can begin to grab revenue and pull it back into the government. and i think that's going to give him some leverage but he's going to need that leverage going into this and not be second guessed. host: our first call is from maryland but i want to put this on the table. is michael steele interested in running for governor in 2014? guest: i don't know. i love my state. it's where i was born and i'm not happy with what i see there. a lot of frustration. we've had a lot of spending in the state and a lot of tax increases and i think people are looking for something that is going to be a little different.

it's a tough state and -- host: tough state for a republican? guest: tough state for a republican and it's one of those opportunities you have to look at carefully. i haven't made a decision than. i'll leave that to smarter people than me. host: good morning. caller: you just read my mind. if you ran for governor i would back you because i've seen a change in you personally. i've been watching and you and it was disheartening for the contest with the republican party treated you and i didn't like it. but what they need to do is come into these communities which they discounted like the black community. they never speak about us being republicans. that's not true. i'm a conservative and a moderate. i'm not a liberal. and i work hard every day and i

really like you and i voted for erowich without a doubt. my thing is the policy -- has to stop, people taking pledges. there is only one pledge we are supposed to take. they should listen to what you are telling them and there might have been a different outcome. when they started doing what they did to that president you know what it made us feel like. guest: i heard it. i heard it quite a bit. and you cannot start a conversation about how to move the country forward when the position is well our sole objective is to make i you a one-term president. so that resonated with a lot of people. i think a lot of how we republicans have expressed

ourselves has been rather bone headed. it is been ten eered. it has been not keeping in mind what people are actually looking for in your leadership. they are looking for you to make some hard choices and to move the needle for them. and i don't think we did that. i go back to the whole debt debate and when we were talking about the end of the bush tax cuts part one, and how does republican party get on the wrong side of a tax increase? when you're looking at your message and it's that off, you have to pay attention to how people are hearing and seeing it. and i think you are exactly right that the party now has an opportunity to fine tune its core and focus on communities. my first official visit outside of washington and this is three days after i was elected chairman was to harlem for a

town hall meeting. and people looked at me and said why are you going there. i said because that's where the votes are. if we don't go to communities around the country that don't look like typical republicans we're going to go to the way of the wigs. host: the republicans should listen to the dems, they know how to run and win. guest: i think there are lessons to learn. i looked at the strategies that the democratic national committee under howard dean's leadership put into position. and he got vilified for a 50 state strategy just as i did. you don't appreciate why are you putting money in arkansas or south dakota or ga well where we're going to elect republicans. you get that momentum of

electing people and spending time and money on the ground to build the party from the grass roots up makes all the difference in the world - host: let me share with you a cup of key demographic areas. as we move down to the issue of race mitt romney getting 59% of the white vote the president 39% of the white vote but the president getting a vast majority of the black, hispanic asian and designated as other. in terms of education mitt romney getting 51% of the college vote. president obama getting high school, some college and post graduate study the president winning 55 to 42. >> - guest: huge demographic shift. across the board success by the obama campaign to identify its voter and for a period of over a year to target that voter and on election day pull the trigger and have them go vote.

i laughed in the summer when people around this town were harping on the obama team hemorrhaging cash, why are they spending all this money this early in the campaign? duh. they were spending the money putting it on the ground to beat our behinds in november. they were investing in technology and infrastructure and a ground game that was beyond 21st century. their ability to identify their voter even when that voter looked like our voter. thing the interesting that your statistics are showing folks who looked like a republican voter turned out to be an obama voter because they identified them, worked them and got them to the polls. host: blake is on the phone on the republican line in alabama.

caller: \[indiscernible] they were able to vote in south because of grand old party, the way sehe talks. that was a long long time ago i guess. i see first of all -- i was curious about a couple of numbers but before i get to that just a quick point about the money that people are talking about, how much money, that money made no difference and it seems like money made all the difference. in the summer romney had no money and obama was savaging him and he could not respond. and he was -- as a rich fellow who had account in cayman

islands and didn't care about the people. he never responded because he had no money. money was the problem. but coming to the statistics what i'm curious what percentage of the total vote, not the democratic party, total vote was black vote, african- american american vote this time compared to what normally it is because obama being on the ticket and what that would have looked like if he was not obama? thet: i'm not sure what final number was a percentage of raw number of black turnout across the country. i know in certain regions of the country it was very high. don't know if it reached the 2008 levels. i do not suspect it did. i think that there was falloff by the african-american turnout but --

african-american turn out but it's important for the g.o.p. to realize for the first time in history minorities elected the president of the united states. the coalition of african- americans and asians and gay community, all these political interest around the country co- alessed in a way that made a difference and that's important for the future of politics. host: i heard last week barack obama won with the coalition of 1972. guest: you could say that. host: these are two tweets the ground game is good but messaging goes a long way. ask michael steele about the republicans must protect and explain individual liberty. guest: both of those tweets are smart and right on.

the first one in terms of the messaging the three m's. money, message, messenger. we don't have a problem getting money. our donors were very generous and we thank them for them. but when it comes to the message and the messengers that is where it false off the cliff. two not finding one or individuals to do it. you have to bring a whole lot of folks not allowed to engage in an honest way because they live in a part of the country or people don't want to deal with, they don't vote for us over there. people said that about my race in 2002, we shouldn't do this because we're running against a kennedy and it's maryland and they won't vote for us. if we didn't engage on ideas and a strong message i wouldn't have been in the game. number two, with respect to ron

paul and i said at the time of the convention the way he was treated was an offense. this man has been consistent about one thing and now we see everyone is coming around full circle on his views on the role of the fed and the government when it comes to our individual liberties and freedom. to have the party not allow him to speak at a national convention to me was offensive because when you have the ability to bring together 18, 25, 30-year-old's to the table and you just turn your back on that, it shows you do not have the foresight to show where our politics are going. host: our guest is michael steele, former chairman of the republican national committee. the former lieutenant governor of maryland.

you have one selection than you have lost elections. we saw mitt romney back at his headquarters, but what the thinking is going through personally? guest: it's tough. he ran before in 2008. for him, this has been a very personal journey to endure what he had to indoor with respect to his face, the assaults on that, the assaults on his character and integrity, assault on his integrity as a governor to lead. it's very personal. you have to find that space and get in that space where you really stand aside and say that's the politics of it, but it's hard to do. thank you for your run. you bested a big field of republicans, he weathered the

storm, and you put together a very strong field. that first debate in september was one of the strongest by had ever seen. he was the governor of his state and i was lieutenant governor and we became close in our association. he was a guy i was always looking for. i would see glimmers of him and it's very frustrating that people around him thought he needed to appeal a certain way. he would have to say things that you know he did not necessarily think was part of the corps. i get the frustration now having to go and live with that loss and try to move forward. host: on the independent line with michael steele, good morning.

caller: one, i would like to just agree 100% from the caller from maryland. i'm an african-american male and i love you. when you were the chairman, i did not appreciate how i really did not push that against some of the more forceful voices. overall, i think the message was right on point. after your loss seeking the second term, what i would hear coming from you, i think it is the tenor and the message that this country greatly needs. it was the frustration in the electorate right now and i think you could be a very, very major force in this political time to come. lastly, i would like to agree with you 100% about the ron paul factor. it from paul had run against a

president i love, i really -- that would have been a head- scratching moment because i love ron paul. his voting record of 25 years actually matches what comes out of his mouth. guest: amazing what consistency will do for a person, right? there's something about ron paul and his leadership. again, you can scratch your head on some of the foreign- policy stuffy has espoused and may disagree with him on that, and that's fine, but he engages you in a debate of ideas around some really strong principles, like the constitution. ron paul will estimate bridget still be a strong player. his son will be a very important voice in the next year or so. i get it. my style is not necessarily the

warmest for some conservatives who like the straight laced stand in the background. i thought of the chairmanship needed to be a vibrant part of the political process. that meant putting it out on the street. that meant doing some shows that were not necessarily traditional for the rnc chairman to do. i just felt very strongly, and i still do, that the power does not rest down here but arrests out in america in the streets. you saw this happen again in this election. it was all race centralized back in washington because we will tell you how to do it because we know best. the reason they hired me was to come in and break that up. some did not like that, whoever else down in other parts of the

country and that's fine. the goal was to push the envelope and push the party to recognize that they needed to play differently. we did that to build a national memory coalitions around the country and reelected two african-americans to the congress and we lose a seat two years later. how does that happen? we are continuing the momentum and it stalls. why is that? it's not me. i get all might bus and i do a speech to charge up the hill, when you get there two years later what? thee's no continuation of command to charge forward. the party needs to do a little soul-searching to see how we move forward. host: should reince priebus have two more years?

guest: that is something the members need to think about. 700 legislative seats around the country taking up senate seats and raising $198 million in an off-year collection without the senate? that's what i did. and i got fired for it. host: are you interested in running again? guest: it might shake things up. host: are you interested? when would you announce? guest: we've got time. host: next caller. caller: i have been watching c-

span this year more than i have ever watched. we now live in a world that is very diverse. like you're saying, we have other races in here and then they have come in to government in lost the momentum. we need people that are diverse and of the world. it i don't care what they say. there's a lot of poverty in all parts of the world as well as people. he was the candidate, but he did not represent.

he was not coming through. whenever he started off campaigning for, he just kept flip flopping. you have to be for everybody. everybody. that is where president obama won. host: they alienated women, latinos, asians, gays, black people, etc. guest: this is no longer the party of old white men the, nor should it be. we should be more reflective of what lincoln bargained for. it individuals of all backgrounds, shapes, sizes, and colors having a home in our party. as always confused me as to why

some people have a problem with that. if i invite you into my party and you are not pro-life would you agree with a whole host of issues that are fundamental to our founding, the government, tax policy, whatever, that's fine. if i invite you in and you have a view that is different than mine or other issues, that's fine. the fact that you want to be a part about this system. says something good about us. if we are putting up a wall saying we need to check and asking if you are this or that? i'm sorry. go to the other side it. we want to continue to send people to the other side? every month, 50,000 hispanics turned 18 years old.

you mean to tell me we're going to look at an 18-year-old deng hispanic person and say, "you know what? join the other side because that is 50 plus years we have lost that vote. are we prepared to do that as a party without really talking about us being the party of assimilation, the party of opportunity? we want to follow the rules law. we want you to have access to opportunities and citizenship here the right way. this is how you do that. more importantly, we want you to follow the dream that brought you here in the first place. i give him kudos for putting that on the table but he sacrifices his campaign for it but could not be honest and it speaks to the reality of this brave new world we are in. it does not mean we need to throw open the borders and invite everyone to come in.

no one has ever said that when talking about a path to citizenship. they're talking about doing the right way and a way in which your responsibilities, as a future citizen, are understood and appreciated from the moment you come on soil. they are not asking for a giveaway or anything special. that messaging goes right to their point. host: the rnc will kick you out for thinking like that. guest: they did. [laughter] host: if you were chairman again, what would you ask yourself? guest: what the hell are you doing? i'm not seriously looking at the opportunity right now, but they need to shake things up and get real. anyone running for that job has

to ask themselves what they are prepared to do to reach the breadth of this party? where are they prepared to go? who are they prepared to talk to to make this party look and feel more like america? people want to be part of what we are doing. they identify with us on so many levels. i'm a very pro-lifer guy, but i have always had a problem with politics getting into my personal business, politics making decisions that my pastor, my minister, my rabbi are responsible for. let me work that out with them. you helped me achieve the pathways to success, the american dream, all that, and make sure policies allow us to free up the economy to free up opportunities. yes. i appreciate the profound

statements on life, similarly for the democrats, things were putting in your platform are things that are not necessarily your strong suit. leave that to the people in communities who are responsible for those social issues because they are so personal. you cannot publicize them so broadly to make a decision for me or you when we are coming from two very different perspectives and experiences. we do have common ground on other things and that is something the country wants us to focus on. host: conservative author in "the washington post" today talking about the president viewing same-sex marriage as an individual liberty right. he says the president has a more conservative position on that issue.

norman, oklahoma, on the independent line. caller: everybody wants john boehner to compromise, but what about harry reid? he's an old bonehead. [laughter] guest: absolutely. caller:i think mr. romney was probably the nicest man that has ever run in the past 50 years. he just was not -- he should not have gone for the carotid artery the chicago way. guest: i love it. you raise a good point. i was struck by his comments in a the end of the campaign when governor romney talked about working with the democrats in the senate and harry reid made the comment that, basically, that was not going to happen.

harry reid has to recognize that, yes, he picked up two more seats in the senate, but that's not an invitation sent by the country to do nothing. put a budget on the table. dense serious about solving the nation's problems. stop the game of playing the thinking you're just going to sit and wait and throw back on the house members for not doing anything. very little was done in the senate over the last two years. certainly with the last four years with respect to something as important as the budget and harry reid now has the responsibility of to indicate his willingness to work with house leadership if we're going to get through sequestration in the fiscal cliff, the bush tax cuts, and a whole host of other issues on the table. not just this interim, but most especially after words when we need to get the nation's

business done. host: they lose and immediately the course begins. republicans must change or die. romney spoke at conservatism as if it were a second language. he was more ford 1976 than ronald reagan 1980. guest: i think a lot of what was said there was true.

he spoke more like ford and reagan? you picked him. again, we knew that going in. he was a governor with a record. we all understood where he was coming from a long before the tail end of this campaign. the second-guessing for me is just baggage that we don't need right now because it really does not advance anything. it is just analysis everyone knew going in. you did not know that he was a northeastern republican? this whole idea of modern versus conservative, again, you start picking up the edges like this and were still avoiding the fact that he's a republican with thousands of the views. that's where i think charles is bright. conservatism did not die on the hill of this campaign. the way we articulated conservatism and the way we talked about it is what did us in. when you start conversations

that people read as offensive to them or insensitive to them, you have to check what you are saying. we never did that. host: let me share you these comments from senator cruz from texas. he saying to the tea party when he won, but want to share with you when he said in terms of his message to the president and what your message would be to republican leaders in the house and senate. this is ted cruz from tuesday night, election night. first, to the republicans, what message would you give them? guest: the time for licking wounds is over. time to get to work. sit down with paul ryan, of eric cantor, mitch mcconnell, john boehner, a strategy to lay out our principled arguments of how far we will go and how far we will not go. what we intend to put on the

table with specificity -- do it. get ahead. but the president in a position where he has to respond, not just push aside. that, for me, in the next few weeks will be very important. i like the tone. it's great. we're going to work together. we get that, by all moment -- kumbaya moment. how are we going to frame the argument and the policy itself? mr. president, this is what the american people want and need in order to fully recover. we're willing to go to the water's edge with you, we will not go out into the lake and brown. [video clip] >> tonight is a tremendous benefit to republican women, tea party women. for all of you, this is your

victory. let me say this. if president obama means what he says on the campaign trail, if he is interested in working order to bring the people together to reduce the deficit and get people working, i will work with him. but if he continues down the same path, then i will spend every waking moment fighting him. host: your thoughts? guest: the most important thing he said there is a fit the present is serious, serious about working with him. but the president is going to hang out in harry reid's corner

of the world and let him get away without putting a budget on the table, not getting serious in the negotiations and really drilling down on something like simpson-bowles, what do you expect the opposition to do? they're not just going to sit there and fall in line just because. both sides now have an opportunity, i believe, to really come to a table with a serious plan and the let's have that fight. let's have that debate about the policy, whether it is tax policy, changing the code, extend the bush era tax cuts and leaving the whole $4 trillion off the table. let's have that debate. as the posturing and the finger-pointing starts, they are not serious, then the ted cruz's of the world do not have any good faith because there is nothing to negotiate over.

host: michael steele, former chairman of the republican national committee, thank you. >> tomorrow on washington journal, we will talk about immigration reform and potential areas of compromise. our guest is fawn johnson. fall but look -- but a look at the role of money and what role will super pac supply. we are joined by kathy kiely. later, a discussion about tax rates and which are scheduled to expire at the end of the year. "washington journal" live at 7:00 eastern on c-span. on friday, president obama talked about tax increases and budget cuts known as the fiscal

cliff. he spoke to reporters in the white house room for about 10 minutes. >> ladies and gentlemen, the president and the vice president of the united states. [cheers and applause] >> thank you. thank you. thank you, everybody. thank you. thank you very much. thank you. thank you very much. everybody, please have a seat. thank you. good afternoon, everybody. now that those of us on the campaign trail have had a chance to get a little sleep, it is time to get back to work, and there's plenty of work to do.

as i said on tuesday night, the american people voted for action, not politics as usual. you elected us to focus on your jobs, not ours. in that spirit, i have invited leaders of both parties to the white house next week so we can start to build consensus around the challenges that we can only solve together. i also intend to bring in business and labor and civic leaders from all across the country to get their ideas as well. in a time when our economy is still recovering from the great recession, our top priority has to be jobs and growth. that is the focus of the plan that i talked about during the campaign. [applause] it is a plan to reward small businesses and manufacturers to create jobs here, not overseas, a plan to give people the

chance to get the education and training that businesses are looking for right now. it is a plan to make sure this country is a global leader in research and technology and clean energy, which will attract new companies and high- wage jobs for america. it is a plan put americans back to work, including veterans, rebuilding our infrastructure, and it is a plan to reduce our deficit in a balanced and responsible way. our work is made that much more urgent because at the end of this year we face a series of deadlines that require us to make major decisions about how to pay our deficit down, decisions that will have a huge impact on economies and the middle class, both now and in the future. last year i worked with democrats and republicans to cut $1 trillion in spending that we could not afford. i intend to work with both parties to do more, and that

includes making reforms that will bring down the cost of health care so we can strengthen the programs like medicaid and medicare for the long haul. but as i have said before, we cannot just cut our way to prosperity. if we are serious about reducing the deficit, we have to combine spending cuts with revenue, and that means asking the wealthiest americans to pay a little more in taxes. that is how we did it -- [applause] that is how we did it in the 1990's when bill clinton was president, and that is how we can reduce the deficit while still making the investments we need to build a strong middle class and a strong economy. that is the only way we can still afford to train our workers or help our kids pay for college or make sure that good jobs and clean energy in high- tech manufacturing do not and

other countries like china. already i have put forward a detailed plan that allows us to make these investments by reducing the deficit $4 trillion over the next decade. i want to be clear -- i am not wedded to every detail of my plan, i am open to compromise, i am open to new ideas. i am committed to solving our fiscal challenges. but i refuse to accept any approach that is not balanced. i am not going to ask students and seniors and middle-class families to pay down the entire deficit while people like me making over $250,000 are not asked to pay a dime more in taxes. i am not going to do that. [applause] i just want to point out this was a central question during

the election. it was debated over and over again, and on tuesday night we found out that the majority of americans agree with my approach, and that includes democrats, independents, and a lot of republicans across the country, as well as independent economists and budget experts. our job now is to get a majority in congress to reflect the will of the american people. i believe we can get that majority. i was encouraged to hear speaker boehner agree that tax revenue has to be part of this question, so i look forward to hearing his ideas when i see him next week. let me make one final point that every american needs to hear. right now if congress fails to come to an agreement on an overall deficit reduction package by the end of the year, everybody's taxes will automatically go up on january 1, including the 98% of

americans who make less than $250,000 a year. that makes no sense. it would be bad for the economy and would hit families that are already struggling to make ends meet. fortunately, we should not need long negotiations or drama to solve that part of the problem. while there may be disagreements in congress over whether or not to raise taxes on folks making over $250,000 a year, nobody -- not republicans, not democrats -- want taxes to go up for folks making under $250,000 a year. let's not wait. even as we are negotiating a broader deficit reduction package, let's extend the middle-class tax cut. let's do that right now. [applause] that one step would give

millions of families -- 98% of americans and 97% of small businesses -- the same certainty that they need going into the new year. it would immediately take a huge chunk of the economic uncertainty off the table, and that will lead to new jobs and faster growth. business will know that consumers are not going to see a big tax increase. they will know that most small businesses will not seek a tax increase. a lot of the uncertainty you are reading about will be removed. in fact, the senate has already passed a bill doing this, so all we need is action from the house. i have the pen, ready to sign the bill, right away. i am ready to do it. i am ready to do it. [applause]

the american people understand we will have differences and disagreements in the months to come. they get that. on tuesday they said loud and clear that they will not tolerate dysfunction, they will not tolerate politicians who view "compromise" as a dirty word, not when so many families and small businesses are struggling to pay the bills. the american people are looking for cooperation, looking for a consensus. they are looking for common sense. most of all, they want action. i intend to deliver for them in my second term, and i expect to find willing partners in both parties to make that happen. let's get to work. thank you very much, everybody. thank you. [applause] thank you, guys. [cheers] >> prior to the president's news conference, john boehner spoke

about the lame duck session. it is about 10 minutes. >> on wednesday, i oulined a responsible path forward to avert the fiscal cliff without raising tax rates. about 24 hours after spoke, the congressional budget office released a report showing the most harmful consequences of the fiscal cliff come from increasing tax rates. according to ernst and young, raising the top rates would destroy nearly 700,000 jobs in our country. the members of our majority understand how important it is to avert the fiscal cliff. that is why the house took action earlier this year, to replace the sequester with other types of cuts, and is also why of the summer we passed a

bill to extend all of the current tax rates. for one year so we had time to overhaul our tax code. and that is why i outlined the responsible path forward, where we can replace the spending cuts and extend the current rates, paving the way for entitlement reform, as well as tax reform with lower rates. at 2013 should be the year that we begin to solve our debt through tax reform and entitlement reform. i am proposing that we avert the fiscal cliff together in a manner that ensures that 2013 is finally the year that our government comes to grips with the major problems that are facing us. we will bring jobs home that result in a stronger, healthier economy, and a stronger

healthier economy means more americans working and more revenues, which is what the president is seeking. this framework can lead to common ground, and i hope the president will respond today in that same spirit. as i said wednesday, this is an opportunity for the president to lead. this is his moment to engage the congress and work towards a solution that can pass both chambers. earlier this week, the president and i had a short conversation. it was cordial. i think we both understand that trying to find a way to avert the fiscal cliff is important for our country, and i'm hopeful that productive conversations can begin soon so that we can forge an agreement that can pass the congress. and with that, i will be happy to answer questions. [inaudible]

>> when the president and i have been able to come to an agreement, there has been no problem getting it passed here in the house. >> you have out what your goal of not having tax rates go up, but you did not lay out a deficit goal. what is the deficit goal that you have in mind? >> clearly, the deficit is a drag on our economy and we cannot continue to spend money that we don't have. i don't want to box myself in or box in anybody else.

i think it is important to come to agreement with the president, but this is his opportunity to lead. >> mr. speaker, going -- >> nope, you violated the rules, disqualified. >> what? >> [inaudible] >> it is clear that there are a lot of special interest to the polls, both corporate and personal. it is also clear there are all kinds of deductions, some of which makes sense, others don't. by lowering rates and cleaning up the tax code, we know that we will get more economic growth. it will bring jobs back to america. it will bring more revenue. we also know if we clean up the code and make it simpler, the tax code will be more efficient.

the current code only collects about 85% of what is due the government. it is clear if you have a simpler, cleaner, more fair tax code, that efficiency, the effectiveness and efficiency of the tax code increases exponentially. jake? >> [inaudible] why'd you have any leverage whatsoever? >> there is a republican majority in the house. the american people reelected the republican majority, and i am proud of the fact that our team and a very difficult year was able to maintain our majority. there are a lot of races out there outstanding, but, jake, it is clear as a political party we have some work to do. i think the principles of our

party are sound. we believe in individual responsibility. we believe in empowering our citizens. we believe in the american dream. we want that dream for everyone. but how we talk about who we are as a party is clearly conversations that are underway and will continue. >> do you plan to have a vote next week about the legislation -- >> you will have to ask mr. cantor. i do not schedule the floor. >> could you talk about raising the debt limit as leverage on the fiscal cliff? >> it is an issue that will have to be addressed, sooner rather than later. >> following on jake's question, a number of exit polls tuesday night said that there were overwhelming numbers of americans, 60% or more, who

favored raising taxes on the wealthiest americans. will you be guided by that principle at all when you sit down to do this? >> listen, the problem with raising tax rates on the wealthiest americans is more than half of them are small business owners. we know from ernst and young, 700,000 jobs would be destroyed. we also know that it would slow down our economy. the number one issue in the election was about the economy and jobs. everyone wants to get our economy moving again. everyone wants to get more americans back to work again. raising tax rates will slow down our ability to create the jobs that everyone says they want. jonathan? >> what are you looking for on the entitlement side? are you talking about the growth of social security and the military?

a listen, we're spending trillion dollars more than what we take in. we cannot continue to do that. this is year two of a 25-year demographic bauble that was not like anyone could not see it coming. 10,000 baby boomers like me retiring every day. 70,000 per week. this is just the second year of the 25-year baby boom bubble. this has to be dealt with. everything on the revenue side and on the spending side has to be looked at. >> mr. speaker project >> no, i'm not on to call on you. i'm not blind. no, the young lady. >> thank you, on immigration, you spoke about the immigration reform.

are you endorsing the pathway to citizenship? >> i am not talking about a 3000-page bill. i'm talking about a common sense, step-by-step approach to secure our borders, allow us to enforce our laws, and fix a broken immigration system. but again, on an issue this big, the president has to lead. i think members on both sides of the aisle want to resolve this issue, the president will have to leave here. >> are you embracing the pathway -- >> i am not going to get into the details of how you get there. it is just time to get the job done. >> mr. speaker, it sounds like you are talking about setting a framework for next year to do tax reform and entitlements, but now, with the sequester, the medicare problem, and you have spoken about this as a concept of a down payment.

could you go into more what that would be? >> i would rather not do that because i do not want to limit the options available to me or limit the options that might be available to the white house. there are a lot of ways to get there. i don't really want to preclude anyone who might have a good idea about how we move forward. but it is clear, it is clear that we have to fix our broken tax system and we have to deal with our spending problem. >> what would you need to pay for the general sequester immediately, or is that part of a bigger deal? >> a nice try. [laughter] >> does calling at tax reform give you a better way of selling it to your caucus in terms of increasing revenues in terms of something that is revenue neutral? >> we have had this discussion over the course of the last

year-and-a-half. when the president and i were attempting to deal with the problem a year-and-a-half ago, there were revenues on the table. you can produce revenue and put revenue on the table through fixing are broken tax system, getting our economy going again, and getting more americans back to work. thanks, everybody. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2012] >> the house leadership reporter for national journal. >> billy house is the house leadership reporter for "national journal." house speaker john boehner has appeared before the cameras every day since the election. what is he sang about the coming work on fiscal issues? >> he is trying to set a tone, i believe, of putting the onus on president obama to show leadership. in reality, he is not really offering anything that they have not been offering for several months in terms of taxes and some other items, but he is

trying to get out front and shown at least they're willing to talk, and president obama today responded and said, yeah, let's talk. >> some news reports are characterizing speaker boehner's comments as a softening or a change in what he said before the elections. what is the truth, has he changed positions? >> softer tone, same position. they say the higher income rates, or any of the rates, they will not go on with reductions. the issue is whether or not to extend the rates that were put in place under former president bush, the lower rates. those expire through the year. republicans say all of them, even those for the higher income earners, need to be extended at least one year as the work and more comprehensive efforts to take on this fiscal cliff. >> has the speaker clued us in on how he will reach an

agreement with the president on of flooding are getting past the fiscal cliff? that he will say the house passed a bill already that will address those things, including extending the bush tax cuts, but also making cuts other than those that are called in to sequester reductions. replacing some of those military cuts with cuts elsewhere. a lot of republican house ideas are to make cuts in social safety nets, like food stamps. that will not fly with democrats in the house or the senate. >> what are congressional democrats and the president looking for? >> it would say more broadly a balanced approach. in other words, hey, let's at least increase the tax rates, but those tax rates increased on the higher income, the 2% of the wealthiest americans, and that would go a long way to helping us not have to find so many other cuts and items to sort of get around this big hit of spending cuts and tax increases we are headed for.

>> what is the timetable for action on all of this? >> the so called sequester cuts hit on january 2. if they are not dealt with. though, when it would actually hit agencies and others, it will trickle into the year. the bush tax cuts technically and at the end of the year. but right around a corner is another problem, and that is the impending debt ceiling, our nation's ability to continue borrowing will have reached its cap. of course, that will lead to some more battles about how high we should extend it and what cuts should be made to let that happen. >> what is more likely, a final agreement on all of these outstanding issues or some sort of short-term band-aid to get past the end of the year? >> i think that is what we have, a band-aid, a bridge, whatever you want to call it, there is already talk about a

return for keeping it down the road six months, maybe john boehner could get his troops on board with cutting half, doing half the cuts that are called for. now, some conservatives, including jim jordan, who is now head of the republican senate committee, from ohio, says, no, we want to do the cuts. we are not interested in taking it down the road. if we do that, we come out of the 2011 budget control act having done nothing except increase spending and have no cuts to show. there will be battles over that, but i think in the end they will do a small part in that will get us into next year. >> he mentioned the president's invitation to congressional leaders to come to the white house to talk about this. what is he hoping to achieve in that meeting? >> i think he will say, hey, first of all he will probably repeat what he said today, that we won the election.

we, if anybody can have the mandate on taxes. of course, speaker boehner will say, i believe we still have some more than two dozen seat advantage in this house. but i think they will all come together and say, hey, you know, this is something that goes beyond partisan politics. this is something that goes to some very critical and clock is ticking issues that are coming or this country could face devastating results, including perhaps another downgrade on their credit rating. that is probably what they will discuss. >> billy house writes for the national journal. thank you for your time. >> thank you. >> tomorrow on "washington journal." we will talk about immigration