>> i thank you for coming and i have won favor to ask him if you could remain seated until you get an announcement to disperse, we would appreciate it. thank you very much for coming. [applause] >> defense secretary leon panetta and joint chief chairman general dempsey

testified about libya that killed for students and three other americans. we will be live touring at 10:00 a.m. eastern on c-span. later, president obama chief counterterrorism advisor and the presidents choice to be cia director testifies against the senate intelligence committee. that hearing is live at 2:30 p.m. eastern. >> president obama announces his nominee interior secretary ken salazar. postmaster general pastor donohoo announces the end of saturday mail delivery. "washington journal" is live.

>> what i have discovered is the war strategy to achieve happiness and life is to make that your primary goal. if you make your happiness what you are striving for, you will not achieve it. you will be knossos cystic, self-involved, caring -- narcissistic, self-involved. happiness is best as a byproduct of other things. it is a five part of meaningful work -- five part of meaningful work, family, friends, good health, love, and care. we get happiness by throwing ourselves into life projects, involving ourselves and trying to have integrity and be a good person. >> whole foods cofounder and ceo john mackey examines how the

good of both dismiss and capitalism can lead to a better world. sunday night at 9:00 on "after word.s." president obama nominated sally jewell for interior secretary. she will replace former colorado senator ken salazar. she would be the first woman nominated for a disposition and the president's second term. we also hear from outgoing interior secretary salazar and ms. jewell. >> please have a seat. everybody is so formal. well, good afternoon, everybody.

the department of the interior is actually the department of america. other members of my cabinet may not entirely agree with that statement but you can see where he's coming from. secretary of the interior is in charge of overseeing 500 million acres of public land, including places like yellowstone and the grand canyon and protecting our natural heritage for our children and our grandchildren and their children to come. but the job also requires keeping an eye on america's future and making smart decisions about how we create jobs and help businesses grow and put ourselves on a path towards energy independence and that's not always an easy balancing act. but with enthusiasm and skill and dedication, that's exactly what ken salazar's done for the last four years. we were just reminiscing a little bit. i've known ken since we were

both running for the senate together and became the only two incoming democrats in our senate class. pete remembers this. it was a lonely time. we actually lived in the same building when we first arrived in washington. and, ken, you'll recall, it was a little discouraging because basically everybody else that lived there was 20 or 25. so we were the two geriatrics in this building. but i came to appreciate quickly, not just him. not only did i come to appreciate his jump shot -- he's surprisingly quick on the court but also his patriotism and his belief that we have a responsibility to care for the land with which we've been blessed.

it's not surprising that ken feels this way. his ancestors were living here before the mayflower set sail. as he explains it and relevant as we are working to get immigration reform passed. his family did not cross the border. the border crossed them. and that's why when i needed someone to lead the interior i didn't need to look far. since then ken has cracked down on waste. he's improved the management of the department to make it work better for the american people. he's ushered in a new era of conservation for our land, our water and our wildlife. he's established seven new national parks, 10 new national wildlife refuges. he's opened more public land and water for safe and responsible energy production -- not just gas and oil but wind and solar creating thousands of new jobs and nearly doubling our use of renewable energy in this country.

he's helped to forge what's probably the strongest working relationship with tribal leaders that the federal government has seen in modern times. and when the unexpected has happened, like the gulf oil spill or hurricane sandy, he's been on the ground making sure that people get help right away and we deal with these challenges as professionally as possible. so i really like ken salazar, if you haven't gotten the point. ken is now ready to head back to colorado and spend more time with hope and his family and so in addition to just saying thank you, ken, for the extraordinary work that you've done, ken is

also going to have the opportunity to introduce his successor. and i am extraordinarily proud today to nominate another strong and capable leader to take the reins at interior and that is ms. sally jewell. in high school sally's aptitude test showed she had a knack for mechanical reasonable and spatial -- we check. we do thorough vetting before nominations. of course her recommended professions after she took these professions were to be a nurse or a teacher. just like all the other girls in her class. and it wasn't until she was an undergraduate at the university of washington she realized her boyfriend's home work was more interesting than hers and she decided to become an engineer. sally went on to work in the oil fields of oklahoma and california. later she brought her experience in the energy sector in banking where she spent 19 years determining what companies succeed and fail. and most recently as the c.e.o.

of r.e.i., a position she's held for the last eight years. sally has helped turn a stalling outdoor retailer into one of america's most successful and environmentally conscious companies. last year r.e.i. donated almost $4 million to protect trails and parks, and 20% of electricity used in their stores comes from renewable sources. even as sally spent the majority of her career outside of washington, where i might add the majority of our interior is located, she is an expert on the energy and climate issues that are going to shape our future. she's committed to building our nation-to-nation relationship with indian country. she knows the link between conservation and good jobs. she knows that there's no contradiction between being good stewards of the land and our economic progress. that in fact those two things need to go hand in hand. she's shown a company with more than $1 billion in sales can do the right thing for our planet.

sally's broad expertise and set of values i know are going to serve her well as she takes on these new challenges. she's got a wonderful and supportive family who i understand enjoy the great outdoors just like she does. so they got a vested interest in making sure that the department of the interior is doing the right thing. when sally's confirmed, i'm willing to bet that she will be the first secretary of the interior who frequently hikes mailbox peak in her native washington state and who once spent a month climbing mountains in antarctica which i don't think of something i would do because it seems like it would be cold and i was born in hawaii. [laughter] so for sally the toughest part of this job will probably be sitting behind a desk. i suspect she'll want to get out of the office quite a bit.

but, again, i want to thank ken salazar and the entire salazar family for their extraordinary service, their extraordinary friendship. the department of the interior is stronger. this country is stronger. our natural resources are in a better place because of his extraordinary service. i could not be more thrilled with the work that sally, i know, is going to do in following that path that ken has carved. i expect the senate to confirm her as quickly as possible. and with that i'd like to invite both of them to say a few words, starting with my dear friend, ken salazar. [applause] >> thank you, mr. president. is it the same one i have?

>> no, that's sally's. just didn't want to get them mixed up. >> let me just first of all say to president obama that i am humbled and honored beyond imagination to have been a part of the president obama dream team for the united states of america. his presidency is historic. his team in the white house is historic and the team at the department of interior are historic. and for that i will ever be eternally grateful to you, my wonderful friend, mr. president. >> thank you. [applause] >> so with your leadership and support and this wonderful team that we have here, we have in fact changed the way that the department of interior does business. we have seized the opportunity together with our other closing on the cabinet and under the

president's leadership and your stellar staff here at the white house to put the nation on a path towards energy independence. today, the largest solar projects in the history of the world are coming up out of the deserts of the public lands of the united states and our foreign oil imports are at the lowest that they have been since 1995. i'm proud, mr. president, of you and your team. because of your leadership on conservation for america. from your support and the signing of the historic 2009 public lands act to the launch of america's great outdoors. together we have ushered in a 21st century conservation agenda and preserve the crown jewels of our nation. from the crown of the continent in montana to the florida everglades to the statue of liberty. i'm proud of our historic work and perhaps more proud of this than almost anything else for the nation's first americans.

from resolving the longstanding conflicts like cobell, to delivering clean drinking water to the navajo nation, you've given credibility, mr. president, to the proposition that the nation's first americans, too, will share in the american dream. mr. president, my parents pushed their eight children to become first generation college graduates and taught us that anything was possible in this nation of ours. as your secretary of interior, you have given to me the opportunity to prove them right and to achieve that american dream, and for that, hope, my entire family will be eternally grateful to you. today, mr. president, i'm also proud to stand with you here as you announce your selection of an outstanding person to be your nominee for secretary of interior. sally jewell knows firsthand the inextricable link between conservation and the economy.

sally was a key contributor to you and to your entire team in the creation of the america's great outdoors agenda. she's been a champion of land and water conservation fund and so many other conservation issues of our time. i also know that her successful business record and experience as an oil and gas engineer will serve her well as she implements your all-of the above energy agenda, which has been such a keystone to you over the last four years, and i'm sure you will have more to say about that very soon. so mr. president, i believe as you have done with all the decisions that you have made since i have been working with you on your team, this is a stellar decision and you've chosen somebody who will be a stellar, outstanding secretary of the interior, sally jewell. [applause]

>> well, thank you, mr. president, for your kind words and for the confidence you're placing in me with this nomination. i have a great job at r.e.i. today, but there's no role that compares than the call to serve our country as secretary of the department of interior. i'm humbled and i'm energized by this opportunity and i look forward to getting to know members of the senate as they consider my nomination in the coming weeks. thank you, secretary salazar, for the opportunities you've given to people across this country, to engage with the department of interior, sharing their hopes and their dreams for our public lands, our resources, our people, especially our first people, our history and our culture. i look forward to working with the dedicated employees at interior who work so hard to care for our land and our resources every day.

i'm going to do my best to fill those big boots of yours, but i think i might get lost in your hat. [laughter] thank you, warren, my husband of nearly 35 years. my two children, peter and ann, for their love and their support on this career journey. i'm excited to take this new challenge. thank you so much. [applause] >> today, president obama and congressional leaders attend the national prayer breakfast.

the event dates back to 1953 with president eisenhower. live this morning at 8:00 a.m. eastern on c-span two. >> there is no prescription or role model or cookbook for being first lady. if you look back at the lives of martha washington or abigail adams or dolly madison or iesco wilson or eleanor roosevelt or mamie eisenhower, you can see that each woman has defined the in a way that is true to herself. how she can help her husband take care of her family, make her contribution to our nation. quick c-span's new original series, "first ladies,"

produced with the white house historical association. season one begins february 18 at nine: 00 p.m. eastern and pacific. >> if you go to most american history textbooks, if you go back to the textbooks in high school, in your american history textbooks, if you go to the index, you will find no tension of eugenics. if you go to your biology books in high school, you would find no mention of the word "eugenie cs." i looked at a biology book assigned to most classes here. great textbooks. i did not see any mention of eugenics. it is as if because we no longer believe in it, we do not

have to think about it. we know eugenics was so awful we can somehow pretend that it was not part of american culture. early 20th-anin century history. saturday night at at 8:00 pm eastern. postmaster general patrick donahoe announced the post office will end saturday mail delivery service starting elite august. the postal service expects a change to save about $2 billion per year. package delivery service would continue six days a week. this news conference from the postal service headquarters in washington is 35 minutes. >> good morning everybody. thank you for joining us. today, we're going to be making an announcement about an important change to our national

delivery schedule. i think anyone who has followed the postal service over the past couple of years know that we have been consistently making changes to our delivery schedule. it is an important part of our strategy returning back to financial stability and it is absolutely necessary to make that move. before i get into the details of the announcement, i would like to spend a couple of minutes discussing the financial reasons for this scheduled delivery change. since 2008, we have seen a steady decline in the use of first class mail. it is our most profitable product and generates the most revenue. people pay their bills online, simple, easy and free. on the other hand, people do -- still like to receive hard copy statements and bills and the fact that businesses continue to send mail to the homes and that's been pretty stable over the past few years, show people do value the mail that they receive.

however, they do like to make their payments online and put a tremendous financial pressure on the postal service. the biggest issue we face is whether we can adapt to these pressures in the marketplace. the laws do not provide a lot of flexibility to adapt. and this results in a major imbalance between costs and revenue. this past year, the postal service posted a financial loss of $15.9 billion. by any measure that is unsustainable and it's unacceptable. of the $15.9 billion loss, $11.1 billion was due to the amount we are obligated to pay the treasure to fund retiree health benefits. we had to default on those payments because we did not have the funds. and you know the postal service is expected to operate like a business.

we generate all of our revenue from the sale of postage. we take no tax dollars. we don't have the ability to reduce costs in a way a private business would. and we are at the end of our borrowing authority. to give some perspective of our liquid situation, a typical large organization would either have cash on hand or quick borrowing ability. in october, the postal service had less than four days of cash on hand. that's a very scary situation and no situation that a business should be in. and this is why we have taken aggressive steps to reduce our costs and why we have been so vocal about seeking postal reform legislation. we faced a major hurdle to return to profitability and long-term stability. we need to generate $20 billion in cost reductions and revenue

increases to close the budget gap and be able to repay our debt, both close the gap and repay the debt. and this is why the board of governors has directed us to take every necessary step to reduce costs and conserve cash necessary to continue our operations. it's what we have been doing consistently over the last couple of years. and we will be accelerating those efforts moving forward. since 2006, we made tremendous strides in cost reductions. we have reduced the size of our work force by 193,000 people. we have done it in a very orderly process through attrition, not through layoffs. and we reduced our annual cost basis by $15 billion. and how did we do that? we consolidated over 200 mail processing facilities,

eliminated 21,000 delivery routes, substantially reduced administrative costs and right now we are reducing hours in over 9,000 post offices across the country. i cannot think of another organization either public or private that can claim that comparable level of cost reduction. we have accomplished these cost reductions while continuing to achieve very high levels of service performance and yet with even these significant cost reductions, we still have a large budget gap to fill. and so today, we are announcing that we are moving forward with a change to our national delivery schedule. the new delivery schedule will result in about a $2 billion annual cost reduction and it's an important part of our return to profitability and financial stability. beginning the week of august 5, this year, the postal service delivery schedule will consist of six days of package delivery and five days of mail delivery. this is a new approach for the

postal service. over the past few years, we proposed moving to a five-day schedule for both mail and packages but our new approach is based on a great deal of customer input we have heard over the course of six, seven months. and strong demand for package delivery and enables the postal service to achieve significant cost reductions. what we are announcing today is not complicated. package delivery will continue monday through saturday and no changes in terms of post office hours. we will be open saturday. we will continue to deliver mail to post office boxes on saturday, which is very important for a number of businesses. mail delivery will occur monday through friday and we will not deliver nor collect mail on saturday.

our decision to maintain saturday package service is driven by a number of factors. we have taken a hard look at the future of package delivery and think there is a he very strong growth over this coming decade. as consumers increasingly use and rely on delivery services especially with the rice of e- commerce, we can play an increasingly vital role as the provider of choice and be a driver of growth opportunities for american business. americans mailing habits are changing and so are the shipping habits. people order goods online and e- commerce will drive those habits into the future. we have seen our package growth grow steadily and we expect this trend to continue. so, what kind of reaction do we expect to this announcement? people will say this is a responsible decision. it makes common sense. last several years, we have seen surveys conducted about a potential shift in delivery from in both packages and mail and consistently, we have seen the same result and this is true when the questions are asked a

little bit differently. 70% of americans have consistently said they would support five-day schedule for mail and delivery for packages given the financial condition of the postal service. we have not done a poll right now to get an idea of this new approach, the six-day package delivery, but we expect that 70% number to jump higher once people become familiar with our new plan. our move is as a result of research and study. two years ago the service put together a detailed plan to implement a five-day delivery schedule and looked at the impacts and we have a strong operational framework. an important announcement is to timing. we made a commitment to residential customers to provide six-month notice to any delivery change and ensure that mailers have adequate time to adjust to schedules and begin communicating with our employees, our unions and

management associations about these changes. many of our employees will be affected as we change to this new delivery schedule and we want to give our employees plenty of time to consider and plan for these changes. we pride ourselves on being a very responsible employer and make every effort to ensure that our employees receive good information. as you might imagine, most of the projected $2 billion in cost savings will occur as a result of a more efficient network and reduction in size of our work force. we are projecting that we will be able to reduce about 45 million work hours making these changes and the key areas of cost reduction will be saturday mail delivery, saturday mail processing and transportation.

the postal service has a great track record of managing through major operational changes. and we believe that we can accomplish our work force goals through attrition and will be working with our unions and management associations. in terms of timing, we will publish detailed operational plans for our business mailers in march, next month, and will be conducting a number of educational efforts to make sure we reach all business customers. as we get closer to the delivery scheduled change in in august, we will be publishing information in post offices, putting it online and other customer contact to make sure our residential customers know. let me conclude with a couple of thoughts. this announcement today is just one part of a much larger strategy to return the postal service to long-term financial stability. the plans saves $2 billion annually, that we have a $20 billion gap to close. we are striving to raise revenues, reduce costs and gain efficiencies throughout the

entire organization and making this change to our delivery schedule is a big-ticket item and simply too big of a cost savings to ignore. in fact, i would strongly argue it would be irresponsible for the postal service not to pursue this course. second, we are implementing this approach to improve our overall business performance. there is a strong and growing demand for our package service and we need to meet that over the coming decade and that's why we are continuing to maintain six days of package delivery. our five-day mail delivery reflects the changing market demand and we are not in a financial position where we can continue to maintain six-day delivery. we are in a situation where we are obligated to make tough choices and decisions and we are committed to keep the costs of mail as affordable as possible and our new delivery schedule helps us to reduce some of the pressure on the overall finances. let me finish where i started. our financial condition is urgent.

we continue to require basic reforms to our business model and continue to encourage congress to look at our comprehensive plan. we need to operate with greater flexibility so we can adapt quickly to the changing marketplace. our announcement today is a step in that direction. thank you very much. i'd be more than happy to answer your questions but i'm going to answer the first question, is this legal? it is. the way the law is set right now with the continuing resolution that we can make this change. the good news is, the continuing resolution that governance the postal service that way expires on the 27th of march, so there's plenty in time in there if there is some disagreement, we can get that resolved and encourage congress to take any language out to stop us from moving to this five-day mail schedule.

our customers said do the right thing and do not become a burden to taxpayers and our customers said we want packages on saturday and this is the right solution for the business and for our customers. questions? >> are you saying there is a loophole in the continuing resolution that is allowing you to do this when -- i mean -- i don't know for how long congress has had the language in their appropriations bill that says you have to do six-day service. i want to ask you about that. second thing is, why didn't you do this before if you were able to unilaterally do it? and third thing is, congress has not shown a willingness to go to five-day service for all kinds of reasons.

so how do you deal with the political fallout or is this just a bluff to get congress to pass legislation that you guys have been very desperately pressing them to pass? >> we feel very strongly that our customers want us to do the right thing. and when you look at the volume of mail that we have lost over the course of the last three or four years, it's substantial. we have lost in just single- piece volume, 30 billion pieces. if you take that times the 46- cent stamp, that is $14 billion just that product alone. you have to be responsible. we don't take tax money. and i think we can work positively with congress to make these changes. last year, there was a lot of concern about post offices. we came up with a win-win after

listening to our customers. they said keep it open, we'll take reduced dollars and saves us money and meets the customers' needs. we feel the same way. we want to work with congress. we are on good footing with us. this is not a hair splitter loophole kind of approach. it's the right thing to do. if there is a disagreement, there is like five or six weeks before the c.r. expires, let's work the language out, get it off the rules and move ahead. >> you say the c.r. has language in it that does not contain language -- >> our interpretation of the c.r., the language does not bind us to five-day and that's where we are. >> ron. lisa? >> angela. >> angela, sorry. >> you said 45 million work hours, what does that equate in terms of the number of jobs and is this layoffs or do it through attrition? >> it equates to 22,500 jobs. right now, the postal service, we run in excess of 10% overtime, almost 12% and we have not hired and using attrition to take advantage of people leaving without having to resort to layoffs.

by eliminating overtime and looking at some flexibility we have with the part-time work force and potentially working with the unions on some this will help. since the year 2000, the postal service has reduced approximately 306,000 jobs, people, new layoffs. we do not want to lay off. we are a responsible employer. yes, sir? >> just to follow up on her question, nuts and bolts, 22,500 jobs, how many people get laid off or bought out when? and the second question is in the back of your folder here, you have daily revenue and daily out-go and the revenue exceeds the out-go.

so -- >> the revenue doesn't exceed the out-go. $15.9 billion last year. >> not according to your own handout. my question is, where's the difference? >> let's talk about the jobs again. by taking advantage of natural attrition in our system, we have a lot of people leave. the postal service, interestingly enough, is a fairly old organization from a people's standpoint. our average age is 54 years olds. and it's easier to have a person work on overtime or replace them with a noncareer flexible employee. and what happens is as we make these changes in august, we will have worked up to that point. we have six months to work with mailers and our unions and management associations and our customers to get everything into place. we closed 2,200 post alpha silts and eliminated routes, people haven't noticed.

we are good about doing these things. we need to move ahead with the plans we have. >> "usa today." what kind of impact will this have on delivery times? will we still be getting mail in two days and three days elsewhere in the country? and the second question is, is there any historical experience with this? has the post office always delivered mail six days a week? >> i'm going to tell you a story, too. from a network standpoint, no change. the network will continue to run. i didn't want to get into the details here, where we accept mail in the system on saturday and sunday, customers will have that opportunity. so no changes. if you put something in the mail

on friday that would have normally been delivered saturday it will be delivered on monday. if it is going across the country, it will be delivered monday or tuesday. no changes. we have some history. the postal services has been delivering mail since 1860's. one time, probably a few people in the audience where they remember we delivered mail two times a day. i have an uncle who was a letter carrier who said, everyone was worried when we delivered mail two times a day and an italian newspaper and made -- the day after they made the change, he said, i said to the guy, sorry i couldn't deliver the newspaper, he said i don't read italian any way. the big changes we have made in our system over the years, people accept. they understand that. they understand that when you lose the first class volume that we have seen, you can't make ends meet from a financial standpoint.

the choice is either change some of the service or raise prices and people don't want prices raised. so we'll make the changes in services. >> i just want to go back to talking about the language in the c.r. that you think gives you the authority to do this. could you talk a little bit more specifically about that, because the c.r. simply funds at the last fiscal year's levels. doesn't that imply that the language is still there? >> from a high level explanation is the way we interpret it. the c.r. talks about appropriations that occur in the current year. the way that we receive money from any c.r. or any appropriations bill, it's for services already provideded. there is no appropriation that runs the postal service. all congress does is reimburse us for money that has already been spent.

and that language is different within the c.r. we have no interest in like trying to catch congress in a loophole. that's not our interest. we want to work with congress to do the right thing. right now, the opportunity exists from our estimate to make the changes on our own and if there's an argument about it, that's ok. we have six or seven weeks to change the language so when the next c.r. or the appropriation bill is done, our language is out of it and we continue on with the responsible course of action that we are proposing. yes. >> "wall street journal." what will your reaction be if the next appropriation bill there is language that says we bar you from making this change? what will your reaction be? >> part of my job is to make a very clear and consist argument in front of congress and in front of the administration that we're doing the right thing and with our business plan, we think we have done that.

we have a $20 billion gap that needs to get resolved. this needs to get resolved from a legislative stand point. if you think about it, we are on the look for $5.5 billion funding bill for the future of retiree health benefits. those things need to be resolved. we want to work with congress on things we don't have control over. i think congress will be very responsible and as we have seen shes the win-win with the small post offices, everybody knows this is the right way to go. customers have said we don't want the postal service to be a burden to taxpayers and we aren't going in that direction. >> what if customers don't accept this decision. you have done this since your inception? what if they protest? a couple of months back, you guys reversed your decision to close post offices. would you reverse this decision

if customers protest? >> we have done a lot of leg work with the customers on this subject. and i quote the 70%. i have seen surveys where it is 80% or higher. the major issues for customers have been, i ordered something on ebay or amazon and i want it delivered this weekend or can i get my medicine in the mail? packages of all sizes will still be delivered. what we'll move away from is the delivery of first class mail, period calls and catalogs. >> "washington post". are you essentially betting that congress will not move to stop this before march 27? and once the c.r. expires, you will have freedom to do what you want. but the next part of that is, what makes you think congress

won't re-impose a ban on five- day delivery since all of the arguments you have raised today you have raised repeatedly and your predecessor and congress has said let's look at this in two years in the senate. and the house hasn't shown any inclination to move to five-day delivery. if you get to march 27, are you confident that congress will not act to re-impose if the ban on five-day delivery? >> i can't speak for congress. what i would say and repeat what i said before. it's my job to lay out a good argument, a commonsense approach on why we should make this move. and the finances dictate it. as i said before, if we had the same volume mail we mad many years ago before people paid bills online, we wouldn't worry about this. we wouldn't about the prepayment of retiree health benefits. you think about the effect

internet has had on everyone in this room, in terms of the news organizations, newspapers, television, we have the same effects. and we cannot put our head in the sand and say, gee, hope this problem will go away. hope is not a strategy. >> it hasn't been accepted repeatedly. >> i can't speak for congress. but i think again my job is to be able to lay the facts out so people understand what the reality is that we're facing. the good thing about what we're doing here i think and i think congress will appreciate that and i know the american people will is that packages will continue to get delivered on saturday and that's what people said they want. >> we usually hear that the private sector works best.

>> of the private sector has some great companies. we partner with them. we do, from a postal service perspective, a good job of providing universal service that everyone is looking for. it is hard for the private sector to do those kind of things. part of the argument we have heard for years is maintaining delivery in the rural areas. that is expensive. we can balance the cost and that is the strength that you get with the postal service. another thing you get is a level of trust or a level of privacy.

i think it will keep the mail delivery and package delivery and the postal service. >> already starting to see e- mail from congress saying they are supportive of the plan to move to five days. have you briefed those committees yet? what was the reaction when you briefed them? people kind of fall behind them. can you give us a bit of those reactions? >> we have spoken to the oversight leadership and the house and the senate. i know you will see some reactions as you have seen today. we want to work with congress and make sure that we work with

the administration. people do a tremendous job for this american public and american business and we want to be able to provide that same level of reliable service going into the future. i expect that to happen. >> this will save $2 billion of a $20 billion budget gap. where do the others come from? >> the largest expenditure that we have, it is for the employee health benefits. and we have the number of others that we are working through right now out in terms of some of the network changes we are making. we also have other small changes we are discussing with congress and the union's right out around health care.

the interesting thing to look at is that time is money. while you delay a change, these numbers add up. by the time you get to 17 and 18, that gap continues to go down. health care, funding, a wheel like to own our own health care plans. we think it would be at our best interests and our employees best interest between the pre funding and the expense we pay of $7 billion a year. >> i am wondering what specific additional legislation like to see congress passed and if this announcements help or hurt the effort. >> we have to resolve the health benefits system.

we are not asking for relief. part of that is to resolve health-care costs from the postal service. we need legislation that addresses those two. we also the legislation that pays money into the retirement system. we are overpaid. it will apply to get that money back. other things from a congressional standpoint, we need some flexibility and some smaller changes going forward. there is a pocket of things that only congress can change. they are in the five-year plan. >> sorry if i am missing something, but are you saying that you're doing this that you would otherwise not have the ability to?

>> again, it is our opinion and the fact of where it is that right now, this is not like we got you. it is our interpretation and the fact that paying for services already rendered, we can move ahead. there may be people that disagree and that is okay. we have six or seven weeks to get it right, let's move ahead with six days of packages and five days of mail. i spoke last night and they know what is going don. i spend a lot of time outside of

this building and i speak to a letter carriers. they tell me to get to five days. preserve package delivery. we don't have enough mail to sustain here. 3:00 in the afternoon, the place was a swarm of people. 6:00 at 7:00 at night, we don't even have the lights turned on in some of these places. people have voted to pay bills electronically. it is what it is. we have to make those changes. they want to preserve this organization. you have to make tough decisions and make them quickly. >> i was wondering about the 22,500 positions you mentioned.

are those full-time equivalents? >> when we talk work hours, it includes overtime. if you convert it to people, a substantial portion is already working on overtime and those go away. what we have tried to do is anticipate what you see behind me on that downward spiral. we have been very conservative that we don't get ourselves in a position where you're giving people pink slips. we have done it without layoffs, the right way. >> are you talking to other unions? >> we have saturday jobs that we

have for letter carriers and some rural carriers. we have mail handlers that work in the evening and supervision jobs. those of the jobs that will be affected. >> what is the prospect for litigation on this? aren't you expecting a challenge from the unions? >> i expect we get a challenge. again, this is america. we can work it out. it is our intention that we would be able to work with congress and move on to get the next cleared up. it is the right thing to do.

>> speaking about liquidity, what is cash on hand right now? will you have to make adjustments for operational adjustments? >> we are going to have a teller caught on friday. we are in better shape than october because we came out of the busiest mailing season of the year. we are consolidating 100 mail processing facilities. we had 22,500 members, whether there are clerks or maintenance people taking retirement and believed. we will continue to move in. they know that we have to make these changes. >> you mentioned you have

flexibility with part-time employees? >> the way that the craft is structured today, we have full time people and flexible non- career. they don't have retirement benefits or anything like that. what that group is made up of his young people. that is why we have been focused on attrition. they have cash flow and conduct their lives, which is good. i would rather not shrink the hours. we will continue over time going forward.

i would like to keep every part- time worker on the role. >> what is attrition typically? >> somewhere between 27,000 and 30,000. depending on what happens this summer, we will have upwards of 42,000. it sounds like we are wrapped up. sorry, one last question. >> in terms of the legality with the c.r., do you have an opinion that is legal and would you make that public? >> i will have to ask my lawyers if i can make that public.

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begins presidents' day, february 18, 9:00 p.m. eastern and pacific. >> "washington journal" picture calls, e-mails, and sweets. then, defense secretary leon panetta and joint chiefs chairman general martin dempsey testify about the attack at the us consulate in benghazi, libya and that killed four americans. later, john brennan testifies before the senate intelligence committee. in 45 minutes, deepak bhargava meets with president obama about immigration. later, the arizona governor later, the arizona governor talks about the differences