there isd backfire if trash thrown about, and then you have to hire somebody to pick it up among which would be more expensive than ending trash cans. we will and with oneh one tweak. one of our followers showing that -- i am planning to view the needy or from joshua t -- joshua tree national park around eight second week in august. emily, thank you. that is all for "washington journal" this morning. we will see you again tomorrow at 7:00 eastern time. our guest include the white house correspondent alexis simendinger, robert levinson from bloomberg government will look at classified and intelligence spending, and we coyne,ok at christopher the author of "doing bad by doing good."

have a good day. [captions copyright national cable satellite corp. 2013] [captioning performed by national captioning institute] >> to them c-span, federal reserve chairman ben bernanke testifies. then, the senator tammy baldwin 's first speech on the senate floor. and in the commencement address at the university of minnesota. the federal reserve -- ben bernanke -- testified before the joint economic committee about the u.s. economy. he talked about the fiscal policies toward quantitative easing.

>> chairman bernanke, welcome.

thank you for your service as chairman of the federal reserve. you deserve great credit for the leadership that, the american financial crisis in 2008. 4.5 years after that crisis, nearly four years after the recession has ended, the fed is still engaging an extraordinary monetary actions. today, this committee will examine how these actions have affected jobs in the middle class america, and how and when fed will act. america's economy is improving, but faces challenging. we are facing the worst recovery since world war ii. the growth gap between discovery and the average postwar recovery is large and growing. we are missing 4.1 million private sector jobs, $1.2 trillion from real gdp. what is troubling is that many economists are predicting a new normal for america. where longform -- long-term growth is diminished.

the budget office release its estimate for potential growth from 3.2% down to 2.2%. the one percentage point out some like much, but it is huge. one percent growth gap means a smaller economy in today's constant dollars. the unemployment rate has declined, which is very encouraging. but there are red flags that we should not ignore. 20 million americans cannot find a full-time job. millions more, from recent college graduates to workers in prime earning years, have simply given up looking for work. unemployment remains at historically high the labor force participation rate is at a 35 year low. while it is encouraging that since the recession hit bottom, over 6 million americans have found work, or than that -- over 8 million americans have been forced onto fort stamps.

-- onto food stamps. one in six americans may now rely on food stamps to feed their families. with strong earnings reports and fed's accommodating monetary policy, there is no question that wall street is will -- is roaring, but main street entities to struggle. since the recession ended, the s&p 500 total return index has risen by 74.2%. disposable income per person has only advanced a mere two point three percent. that means that over the last four years, the real disposable income for joe sixpack increased a mere $745. an average recovery since 1960, he would have 3006 hundred $40 more in his pocket by now. $3640 more inve his pocket. these same low rates are

punishing seniors, favors, tension lands and insurance products. families may now feel more secure about their house, but less secure about their income and job prospects. as for the fed's unemployment rate turning, quantitative easing has run out of steam. long-term interest rates are already adding your 70 year low. thanks have $1.9 trillion in .xcess reserves at the fed nonfinancial corporations have $1.5 trillion more sitting on the sidelines. more liquidity and lower long- term rates cannot fault -- cannot solve the problem's holding back job creation in america. business investment in new buildings, equipment, software, which drive drop creation, remains the missing ingredient in this economy. monetary policy, no matter how thoughtfully applied, has its limits. it cannot six poor washington budget and tax policy.

ishink my key point today that i do not question the fed policyf current to fulfill its mandate, but i question the policy's effect on employment, and i worry about future risks. in the near term these extraordinary monetary actions become an enabler of bad fiscal all of the, allowing president obama and congress to avoid the tough and necessary decisions that will clear the roadblocks with stronger economy. addressing america's long-term financial sustainability. rebalancing regulation, addressing the harmful economic effects of the president's affordable care act. in the long term, the fed's extraordinary monetary action pose three were -- three risks to the economy. the fed may be inflating price bubbles. large excess at the fed could

become the fuel for future inflation when economic growth accelerates. toess the fed acts swiftly contrast the balance sheet. 's balance sheet creates a perverse incentive for future financial repression. an economic term which means channeling domestic savings to the federal government to lower its interest cost. since 2009, the fed has purchased equivalent of 24% of all newly issued treasuries. when growth picks up, we hope it does, the fed cannot raise its target rate for federal funds and sell long-term treasuries without recognizing substantial losses on its balance sheet, creating uncertainty. to avoid that, the federal light would boost the interest rate, pay the banks and the reserve, increase the reserve requirement, which would restrict economic growth by limiting bank loans to small

businesses and families. financial repression. we needed through the fed through the treasury to help maintain costs. given these risks, and the limits of the monitored policy, the federal reserve should begin now to carefully exit from its extraordinary monetary actions and return to a more predictable, rules-based monetary policy to focus on maintaining the purchasing power of the u.s. dollar over time. begin now with clear communication to the market. that will lessen uncertainty and form the best long-term foundation for maximum economic growth for america. today, we intend to explore the fed's exit strategy and timing. chairman bernanke, i look forward to your testimony. i yield the vice chair of the committee. >> thank you very much, chairman brady.

thank you for putting together this hearing. we have very good attendance for you, chairman ricky. thank you for being here. i look forward to your testimony and your thoughts on the short- term. as you know, the economy has added private sector jobs for 38 straight months. during that time, 6.8 million private sector jobs have been created. key economic indicators are also showing some strength. the housing market is recovering. in my officetors from minnesota last week, and it was the first time they had smiles on their faces in a couple of years. credit conditions are improving. but we all know that there is a lot more work to do. my hope is that this hearing will allow us to talk about potential solutions that can move our country forward. because of the fed's two objectives, maximum employment and stable prices, i am eager to hear your thoughts on what the fed is doing to stimulate

lending and economic activity. one issue that i know we are all concerned about is what is going on in congress. you have testified before about how that would be the best solution and that we would have more tools to move this economy forward. pleased the immigration reform bill passed with a strong bipartisan vote last night. that is one example as you look at skilled workers in addition to our own training we need to do in this country for science, engineering, math, and technology. on work we need to do exports. the work on congress of tax reform, as well as bringing down the debt and getting our fiscal house in order. i wanted to focus on that for a minute. in the past two years, congress has made some progress, as you know, in reducing the deficit. 2.4ave achieved about trillion dollars in deficit reduction, and the goal of $4 trillion, which is one goal that was set out by a number of economists, is within our grasp

over the next 10 years. last week, the congressional budget office reported that the deficit will fall to $642 billion, which is $200 billion less than what the cbo projected three months ago. the better numbers reflect good news and housing and larger than expected increases in tax revenue, but i believe they're resting on these numbers would be a mistake. i think we are closer to reaching a new deficit agreement that many people believe when you look at the numbers at the end of the year when speaker boehner and the presidents were negotiating, when you look at some of the work that is being done on a bipartisan basis in the senate, and it is frustrating to me that we are not reigniting those negotiations. it is only going to happen if we work in a bipartisan manner to get a deal done. the budget the senate passed, which i voted for, is a good approach, but i think everyone is open to some compromise. the senate approach is balanced with targeted spending cuts to replace sequestration, and new

revenues from closing loopholes and ending wasteful spending in the tax go -- tax code. i feel strongly that we should be going to conference committee in regular order with these two budgets, the senate and the house, and get this done. last night, senator mccain and senator collins came out and agreed that these two budgets should go to conference committee. warn that cutting too much too soon could lead to a sharp contraction on our economy. i remember that well because for any woman who has been in labor, it is a very meaningful phrase -- a sharp contraction. it is one of the reasons i believe the deficit reduction must be paired with economic growth. our ultimate growth is not ugly a balanced budget -- it is a budget that has balance. as we work toward that goal, we must avoid a repeat of the debt ceiling debacle from the summer of 2011 that rattled financial

markets, led to a downgrade of the u.s. credit rating, and unnecessarily harm our economy. when i asked you about the debt ceiling showdown at agp hearing at the fall of 2011, you answered -- it is no way to run a railroad. i agree with must do better this time. we have some breathing room because of the change with the debt. to pressst continue policies that will help the economy. the immigration reform. a long-term farm bill, which helped with a significant sector of our economy that i believe we'll get through the senate in the next two or three weeks. work training. regulatory reform, streamlining regulations. cumbersome and paulson and i have worked a lot on the medical device industry, trying to make those fda approvals quicker. a conference of tax reform. smart this is also federal reserve policies. since the financial crisis

again in 2007, the fed has used many tolls to bolster our economy. it has kept short-term interest rates near zero since late 2008, and it has taken action to keep longer-term interest rates and mortgage interest rates low. as you and i have discussed, this makes it hard, yet in the past three years, americans have saved more than 4% of their income. the fed has taken steps to open up its policymaking rossett, expand communication, provide more specific guidance, and enhance the transparency of monetary policy. finally, there has to be an ongoing discussion about changing the fed's goal. there has been an ongoing discussion. chairman brady had a good hearing on this. in my view, now is not the time for the fed to take its eye off of promoting employment. i hope that we can come together to find solutions that put more americans back to work. the employment rate while had

been -- while heading in the right direction remains that over 70%, well above the 6.5% level -- well over seven percent. i'm employment in my rate is significantly lower at 5.4%. again, there are states that have weathered this downturn and are actually expanding the economy. at the same time, inflation is well below the fed's target of tubing percent. 1% over thebout past 12 months. notes. like to hear your i believe we have turned the corner and our economy is getting stronger, but i also believe there is so much more work to do. as congressman delay notes from the hearing that we had on long- term on its limit, while the unemployment numbers are getting better, there are still many people -- too many people -- that have been unemployed for more than six months under

finding it very difficult to get back into the job market. this is all conflicting news in terms of the long-term unemployed and the numbers which show improvement, we all know we have more work to do. i look forward to discussing how we can build on this economic progress. thank you for being here and for your testimony this morning. >> i would like to welcome chairman bernanke to our hearing. dr. earning he is currently in his second term as chairman of the board of governors to these federal reserve. prior to his current position, he was a economic advisor. he purposely serve the federal reserve system as a member of the board of governors. a member of the academic advisory panel. he has the established teaching and education career. i welcome chairman bernanke. you are recognized, sir. >> thank you. chairman brady, vice chair

klobuchar, and other member's of the committee, i appreciate this opportunity to discuss this opportunity. economic growth has continued at a moderate pace so far this year. reald gdp is estimated to have risen as an annual rate of 2.5% in the first quarter after 1.375% in 2012. economic growth and supported by demand by u.s. house old and business, which offset the drag from the decline in government spending. conditions in the market have shown some improvement recently. 7.5%nemployment rate is in april has declined more than .5% since last summer. again cents nonfarm phil roe implement have average more than 2000 jobs over the past past six months, compared with average monthly gains of less than 140,000 during the last six months. in all, payroll implement have

expanded by more than 6 million jobs since as low point, and the unemployment rate has fallen 2.5% since its peak. despite this improvement committee job market remains weak overall overall. the on employment rate is well above its normal level. rates of long-term unemployment are historically high. the labor force participation rate has continued to move down. moreover, nearly 8 million people are working part-time, even though they would prefer full-time work. high rates of unemployment and underemployment are extraordinarily costly. imposey do they hardships and affect the individuals and families, they also damage the productive potential of the economy as a whole by eroding workers skills and by preventing many young people from getting workplace skills and experience in the first place. the loss of output and earnings associated with high on employment also reduces government revenues and increases spending on income support programs, luke thereby leading to larger budget cuts

and higher debt than would otherwise occur. consumer price inflation has been low. the price index for personal ventures rose only 1%, down from about 2.25% in the previous 12 months. this low rate of inflation partly reflects a decline in consumer energy prices, but price inflation for other goods and services have also been subdued. never the less, measures of long-term inflation x ray patients have remained stable and continue to run over the past several years. over the next few years, inflation appears likely to run at or below the two percent rate that the federal local gnomic -- the federal economic committee wants. over the nearly four years since the beat recovery began, the economy has been head back by a couple of headwinds are some of these headwinds have begun to

dissipate recently, in part because of the federal reserve's monetary policy. notably, the housing market has strengthened over the past year, supported by low mortgage rates and improved sentiment on the part of potential buyers. increased housing activity is fostering job creation and construction and related injuries -- elated industries -- related industries. severe fiscal and financial strains in europe are weighing on u.s. exports and financial exports have also restrained u.s. economic growth over the past couple of years. however, since last summer, financial systems in the euro area have improved, which have helped mitigate the economic slowdown there while also reducing the headwinds faced by u.s. economy. also, credit conditions in the united states had eased for some types of lines as -- of loans as bank capital and asset

quality have strengthened. fiscal policy at all levels of government has been and continues to be an important determinant of the pace of economic growth. quitel fiscal policy was expansionary during the recession and early in the recovery. a substantial part of this impetus was offset by spending cuts and tax increases by state and local governments, most of which are subject to balanced budget requirements, and by fiscal tightening at the federal level. over the past four years, state and local governments have cut civilian and government employee by roughly 700,000 jobs and total government implement has followed by more than 800,000 jobs over the same time. over the quarter years following the 2001 recession, total government employment rose by more than 500,000 jobs. , therecently strengthening economy has improved the budgetary outlooks

of slow states of local governments. at the same time, fiscal policy at the federal level has become significantly more restrictive. in particular, the expiration of payroll tax cut, the enactment of tax increases, the budget caps on discretionary spending, the onset of the sequestration, and the defense spending for overseas are expected to exert a substantial drag on the economy. the cbo estimates that the deficit policies will slow the pace of real gdp growth by about 1.5% in 2013 relative to what it would have been otherwise. in present circumstances, with short-term interest rates are ready close to zero, monetary policy does not have the capacity to fully offset an economic headwind of that magnitude. although near term fiscal restraint has increased, much less has been done to address

the federal government's longer- term fiscal imbalances. that underjects current policies, the federal deficit and debt as a percentage of gdp will begin rising again in the latter part of this decade and move sharply upward after. reflecting the aging of our society and protecting increases in health care costs, along with mounting debt service payments. to promote economic growth and stability in the longer term, it will be essential for fiscal policy makers to put the federal budget on a sustainable long-run path. arertantly, the objectives addressing longer fiscal term imbalances and analyzing the headwinds are not incompatible. to achieve both goals for simultaneous the, the congress and and administration could consider replacing some of the near term fiscal restraint with policies that reduce the federal the deficit more gradually in the near term, more substantially in the longer run. with unemployment well above

normal levels, fostering our aggression only mandated objectives requires a highly accommodative monetary policy. normally the committee would revive policy accommodation by reducing the target for the federal funds rate, thus putting downward pressure on interest rates generally. andfederal funds rate other short-term rates have been close to zero since late 2008 so the committee has had to use other all is the tools. the first of these alternative tools is forward guidance about the likely future targets of the federal funds rate. since december, the committee's post meeting statement has indicated that its current 02 one fourth resident -- inflation between one and two years ahead is projected to be no more than .5% above the committee's 2% longer run goal, and longer-term inflation at quotations

continue to be well anchored. this guidance underscores the committee's intentions to maintain highly accommodative monetary policy as long as needed to support continued product -- the need progress. the second policy tool that we use is large-scale purchases of treasury securities and mbs. downwardchases put pressure on longer-term interest rates, including mortgage rates. agency mbs at a pace of $40 billion per month. the committee has said that it will continue its securities purchases until the outlook of the labor market has improved substantially in the context of price ability. the committee also have stated that in determining the size, paint, composition of its assets purchases, it will take appropriate account of the costs of such purchases as well is the extent of progress toward its objectives.

at its most recent meeting, the committee made clear that it is an prayer -- prepare to increase or reduce the debt purchases to ensure the monetary policy remains appropriate as the outlook to the labor market for -- or inflation changes. accordingly, in considering recalibration of the pace of purchases, the committee will continue to assess the degree of progress made toward these objectives in light of incoming information. the committee also reiterated that it expects a highly accommodative stance of monetary policy to remain appropriate for considerable time after the asset approach -- asset purchase program ends. in the current economic environment, monetary policy is providing significant benefits, low real interest rates help support spending on durable also contributed significantly to the recovery in housing sales, construction, and prices. higher prices of houses and other assets in turn have

increased household wealth and consumer confidence, spurring consumer spending and a germane to gains production and employment. importantly, accommodated monetary policy have also helped offset deflationary pressures and kept inflation from falling further below the committee's 2% longer run objective. the committee is aware that a long period of low interest rates has cost wrists. low interest rates have helped create jobs and support of the price homes and other assets, savers who rely on income from savings account or government bonds are receiving low returns. another cost at we take seriously is the possibility that very low interest rates, if maintained for too long, could undermine financial stability. investors or portfolio managers satisfied with low returns may reach for yield by taking on more credit risks for leverage. the federal reserve is working

to address financial stability concerns to increase monitoring a more systemic approach to supervising financial firms and the ongoing implementation and reforms to make the financial system more resilient. ofognizing the drawbacks persistently low rates, they seek -- unfortunately, withdrawing policy accommodation would be highly unlikely to produce such conditions. a premature tightening of monetary policy could lead interest rates to rise temporarily, would also carry if it natural -- carry a substantial risk of causing for inflation to fall further. outcomes tend to be associate with extended periods of lower, not higher, interest rates, as well as for returns on other assets. moreover, renewed economic weakness proposes its own risks to financial stability. because only a healthy economy can deliver sustainably high real rates and returns to savers and investors, the best way to receive -- to achieve higher

rates is for the federal reserve to provide policy accommodation as needed to fox or -- to foster maximum limit. we will do so with regards for the efficacy we will do so in a way that is responsive to the economic outlook. thank you, mr. chairman. >> the economy has already started on winding. what is the fed exit strategy and then do you expect to execute it? >> mr. chairman, the first course would be to wind down and eventually the quantitative easing program, the asset purchases. as i said, the program relates the flow of asset purchases to the economic outlook as the economic outlook and particularly outlook for the labor department improves in a

sustainable way, the committee will gradually reduce the flow of purchases. i want to be very clear that a step to reduce the flow of purchases would not be an ofomatic mechanistic process ending the program. rather, any change in the flow of purchases would depend on the incoming data and our assessment of how the labor market and inflation are evolving. so at some point, of course, we will end the asset purchase program. subsequent to that, we will follow the guidance we have provided about interest rates. our principal tool for raising interest rates will be the interest rate on excess reserves that we pay, which will induce higher money-market rates and a higher federal funds rate, and we will complement that with other tools, including tools we have for draining reserves. we may or may not sell assets at this point. it does not appear that it is necessary for us to sell any

that iso exit in a way not in danger price stability. so there are a number of steps we are currently discussing further our exit strategy. we hope to provide more information going forward, but we certainly are confident that we can exit over time in a way that will be consistent with our policy objectives. >> do you anticipate allowing insurance securities to roll off the balance sheet before you begin selling securities? >> as i said, we could normalize policy by simply letting securities roll off. i think there are some advantages to doing that. for one, it would not disrupt markets so much. it would avoid as much irregularities in our fiscal payments to the treasury. but we will see. ultimately, in a very long run, i think there is a desire to get back to a predominantly treasury

securities portfolio. but again, in the exit process, allowing assets to roll off would be sufficient to bring us to a normal balance sheet within a reasonable period. >> when do you expect the strategy to begin? what benchmarks are you looking at to begin this process? >> we are looking at -- we are trying to make an assessment of if we have seen real and sustainable progress in the labor market outlook. this is a judgment that many will have to make. if we see continued improvement and have confidence that that is going to be sustained, then we could in the next few meetings take a step down in our pace of purchases. again, if we do that, it would not mean that we are automatically aiming towards a complete wind down. rather, we would be looking beyond that to see how the economy evolves, and we could

either raise or lower our pace of purchases going forward. again, that is dependent on the data. if the outlook for the labor market improves and we are convinced that that is sustainable, we will respond to that. if the recovery were to falter and inflation fall further and we felt that at the current level of monetary accommodation was still appropriate, then we would delay that process. >> at the pace we are going, do you think it is likely these actions would begin before labor day? >> i don't know. it will depend on the data. the key to this program -- in our previous quantitative easing programs, we gave a total amount of expected purchases, and when that total amount was done, we stopped. in some cases, that stopping was premature because the economy was not yet on a fully self sustaining trajectory. the difference in this program is that we are buying a flow rate, a certain amount of assets each month, and the amount that we purchase will depend on how

the data come in and how the outlook for labor market goes over time. >> how much notice will you give the market before you start executing the strategy? >> we have explained the strategy. again, the market can see the data as well as we can. we are looking for increased confidence that the labor market is improving and that that improvement is sustainable. in steps that, we will respond to that by reducing the amount of accommodation in a way that is appropriate and maintains an appropriate level of accommodation given the economic outlook. >> it is frustrating, here we are nearly four years after recession ended, and this economy is in such a weak state, fragile state at this point. the patient ought to be out of the hospital, done with rehab, and playing baseball with his kids. i feel like the fed continues to

feed it medicine on a daily basis, asking, "are you getting better?" my worry is that the fed does not have the prescription for what ails our economy. a year ago, the fed made clear that it would not set an employment target rate because it is generally affected by non- monetary factors, but your on winding qe based on the areas that you have the least control of. what do we make of that? >> mr. chairman, first of all, the slowness of the recovery can be explained by a number of important headwinds, including the after effects of the financial crisis, developments in europe, problems with the housing market, and very importantly, the fact that fiscal policy the last few years has been a significant headwind to recovery rather than a tail wind. i would submit that without monetary policy's aggressive actions, that this would do it -- this recovery would be much weaker than it has been.

if you compare our recovery to that of europe and other advanced industrial economies, it looks relatively good. with respect to employment, the monetary policy as a general rule cannot influence the long run level of employment or unemployment, and that is certainly correct. what we are trying to address here is the short run cyclical gap. we are seeing currently the economy operating at a level below what it is capable of operating at, and many people out of work who normally would have work, and monetary policy can help to put people back to work in the short run. in the longer run, increasing the potential growth of the economy, as you mentioned earlier -- that is not really a fed job. that is the private sector's job and congress' job. >> thank you. i will conclude with just the point that i think monetary course.as run its

i have yet to meet a business who tells me if long-term rates which is lower and there was liquidity they would be hiring more. that is just not happening. it really is fiscal issues from higher tax increases, regulation extraordinarily burdensome to them. the president's health care law is creating a great deal of uncertainty and impact on job hiring. today, those are the main roadblocks theory that is why i think the earlier the fed can begin communicating and is puting, the more onus on congress and the white house to actually address some of these critical issues. with that, i recognize the vice chairman. >> thank you very much, mr. chairman. i was going to take the analogy the chairman just made about the hospital, and i was thinking that we are out of intensive care, thanks in part to the actions of the fed, and we are probably out of the hospital. one of the problems is because of this brinksmanship that goes

on on the hill here, we keep having to go back to the emergency room, and i do not think that helps. we also just are not in that kind of long term, healthy way that we want to be. so i want to start with that. right now, the fed is working to spur the economy, as you just discussed, at the same time that congress is implementing across the board spending cuts. i'm one who believes that we have to have a mixture of cuts and revenue, but some policymakers are pushing for even deeper cuts than we are seeing with sequestration. what effect do you think sequestration -- you addressed this in your opening statement -- what effect do you think it is having on economic growth? do you think it would be better to have a long-term budget in place? in myi talked about testimony, sequestration is only part of an overall pattern by which there has been considerable fiscal restraint in the short term, not involving just sequestration, but tax increases and elimination of

payroll tax cuts, and numerous other things, which collectively are creating quite a bit of head when for the economy. now, i fully realize the importance of budgetary responsibility, but i would argue that it is not responsible to focus all of the restraint on the very near term and do nothing about the long term, which is where most of the problem exists. i do not take a view on tax cuts versus budget spending. that is really the prerogative of congress, but i do think that we would all be better off with no loss to fiscal sustainability or market confidence if we had somewhat less restraint in the very near term, this year and next year, say, and more aggressive action to address these very real long-term issues, which threaten within a decade or so to begin to put our fiscal budget on an unsustainable path. >> so having a more long-term approach with spending

reductions as well as revenue changes would be better? >> it is a long-term problem, and i would advocate looking at it from a long-term perspective. i worry sometimes that the 10- year window may artificially constraining thinking about the appropriate horizon for budgetary discussions. >> well, we are not even at the five-year window. there are many of us in the anate that would like to see budget conference committee so we can really work on these things and try to work them out. you are talking with chairman brady about the work of the fed. there have been proposals to change the fed's dual goals of maximum employment and price stability to a single focus on price stability. how would that change the fed policy making? >> first, let me say that, of course, congress sets the mandates for the federal reserve, so congress has the right to set the mandate any way it likes. my own personal view is that we have been able to help on the employment side and that the

dual mandate has served us well since the mid-1970's when it was first incorporated. i would recommend that you stay with that. but again, congress certainly is able to make that decision if it wishes. i would point out that even though we have a dual mandate, that inflation, if anything, is a little too low. inflation has been very low. the dollar has been strong. we have not in any way failed on that responsibility, so i think it is consistent with our mandate and our current policy to maintain price stability, and that is what we have been achieving. >> the federal banks in other countries that just have a single goal and not the dual mandate, do they have a better track record in terms of inflation? >> i don't think so. in fact, they often also -- i think in practice, they do respond to cyclical conditions.

that is certainly the case in a number of major central banks. again, our inflation record is as good as, really, any central bank's, so it has not really been a sacrifice in that respect. >> last month, we held a hearing examining the persistently high rates of long- term unemployment during the recession and recovery. cluster four in 10 unemployed workers have been without a job for six months or longer. you made reference to it in your testimony. long durations of unemployment have long lasting impacts on health and the children of the unemployed. are you seeing signs of rising structural unemployment? and is the high long-term unemployment rate a sign of structural challenges? >> it is a significant concern, and we are seeing evidence, for example, that employers are reluctant to look at people who have been out of work for a long time, even if they appear to be qualified.

just on the assumption that if you have not had a job for six months, there must be something wrong with you. >> actually, the former adviser to mitt romney who spoke here, who did a very good job, talked about that as a scar on the worker, that it is so difficult for them to go out there for this record -- with this record at this point. >> that's right. we think at this point, that this is not an irreversible problem, but we are concerned about the long run effects on employability of people who have been out of work for a long time, and if they are employed again, what will their wages be? likely much lower. >> is the fed able to address cyclical or structural unemployment or structural unemployment different, and are they better address the 3 job training, education, and things we should be doing? >> monetary policy -- and this again relates to chairman brady -- is not able to address long- term issues very well. our goal is to address cyclical

unemployment primarily. that said, cyclical unemployment that lasts long enough becomes structural unemployment, as people whose skills and so on, and that is one reason for the urgency of trying to get people back to work as quickly as possible. >> i mentioned how low interest rates have helped spur the economy by promoting investment by businesses and households, and low mortgage interest rates have helped with this growing housing market for the first time in many years, but lower interest rates, as you and i discussed, have also affected older americans who live off fixed incomes and are relying on the return they can get from the safety of government bonds. can you talk about the impact you think low interest rates are having on u.s. households? >> generally, i think that low interest rates are helping households. i am very aware of the return issue that you just mentioned. i will come back to that in just a second, but it is often true that low interest rates are making it easier for people to buy homes, are increasing the

price of homes, increasing construction jobs and other jobs related to housing, have supported automobile purchases, and manufacturing, and are generally adding both to ofloyment and to the wealth americans. in that respect, i think this is very much a mainstream policy. that is very much our intention. are respect to savers, they workers, and they own small businesses. a healthy economy helps them in those capacities. as i said in my testimony, what we would like to do is get higher returns in a sustainable way. a weak economy will not produce high returns. in japan, for example, interest rates have been 1% or lower for 15 years. the only way to get interest rates up to get the economy growing again so the returns will be adequate, not just for

fixed income instruments, but for other kinds of assets as well. >> thank you. chairman and mr. mr. chairman. you mentioned in your opening remarks about financial stability concern driven by the quest for higher yields and some of the risk that could cause given the low risk in fixed income instruments. had your concern about these financial stability concerns increase recently? it has increased a bit. we have greatly increased our monitoring and our attention to these issues and we pay very close attention to essentially all asset classes and all major types of financial institutions, even those we do not regulate. we are trying to ascertain both if there is a sign of frothing ors or bubbles -- frothiness

bubbles, and moreover, if there is a sense of high leverage or other kinds of vulnerability, that would mean if a frothy asset price were to reverse, what implications would that have for the broader economy? we are paying closer attention to that, and doing our best, both through monitoring but also through our supervision, regulation, coordination with other agencies and so on to address some of these problems. some of these issues were discussed in the annual report, which secretary louis has been testifying about, so this is an issue, and it is something we take into account. as we mentioned in a statement, we look at the cost and the efficacy of our program, and i think the most significant cost is probably financial stability concerns. on the other hand, it is a very difficult tradeoff because, as i mentioned, a weak economy means low interest rates, which creates some of the same

problems, and moreover, a weak economy means worsening credit quality, for example, and that, too, has financial stability implications. there are trade-offs and difficult judgments to make, but i want to assure that we are quite aware of the issue and watching it very carefully. it does factor into our thinking about the proper amount of accommodation and the appropriate exit strategy. >> speaking of exit strategy, yesterday, the federal reserve bank president said that the federal reserve should consider holding onto mortgage-backed securities until maturity rather than selling them at whatever point an exit strategy might be necessary. maybe i read wrong, but i thought i heard in your response to chairman brady's questions that perhaps you agree with that viewpoint? if so, because when the fed into a couplentered the qe of years ago, that was not the plan for the exit strategy.

the plan for the exit strategy was to begin selling those at some time. you are correct we have not updated the exit strategy. the committee has not officially communicated our plans, but i will say that we have done a lot of work on this, and i personally believe that we could exit without selling because most of them will run off in a reasonable period, but that decision has not yet been taken, and we will certainly let people know it when it is taken. >> if you do that, are you subject to the argument that that is out right on a physician -- monicaization in that that debt will never be sold to the public essentially? >> no, because monitress asian means we finance

the government. what we plan to do is get our balance sheet back to a more normal level and get excess reserves back to a more normal 25 billion or so. that seems like the more likely outcome. my point is that we can do that by allowing assets simply to run off and mature rather than selling them. either way, it gets them off our balance sheet. >> in my final 45 seconds, bank of japan -- yesterday, they repeated their qe, if you will, and there is significant buying. the yen is depreciating about 5% against the dollar. how do you see this as a potential currency war? a race to the bottom? are all world central banks leaning towards trying to -- in a war here of depreciating currencies? given a statement

with which we agree, which is that monetary policies, which are directed primarily at the domestic economy and are not specifically designed to affect relative exchange rates, are acceptable because whatever effect they may have on exchange rates, they also affect domestic depend on the domestic demand in japan, which is good for the global economy because it creates more trade and activity around the world. we are supportive of japan posted policies, and i would make two observations -- one is that under their current plan, the japanese felt -- the bank of japan posted balance sheet as a share of gdp will be three times larger than the fed's, just to give you a shot -- a sense of proportion. separately, the actions that have taken seem to be having a dramatic effect, both on financial markets, but so far as we can tell, on some aspects of the real economy. i take that as a bit more evidence that these policies to have effects on the economy. >> thank you. >> thank you.

representative delaney is recognized for five minutes. >> thank you, and thank you not only for your leadership, which was really a comparable across the financial crisis in particular, but also for your testimony today here, which i thought was very well crafted in terms of laying out the limits on the economic recovery. we can see absence certain actions from congress and the administration. in other words, the cost of this inaction is not nothing, and we see it in the cost of the economy, and as the kids to me you were fairly specific with what we should do. first, we should focus on the long-term fiscal challenge. the years what i will call 11 through 20 challenges, which can only be addressed through appropriate but comprehensive reforms to our entitlement programs and reforms to our tax programs. but also in the short term, the more intelligent about the cuts that we make, about our tax

policy, and about the investments we make in the country, and absent our doing that, you face challenges, and the country faces challenges. tor challenges iare you have continue to make monetary policy. while i agree with chairman brady that monetary policy has limits, it seems to me its limits have to always be defined in the context of what else is going on. in other words, the limits, i would think, of your monetary policy would be different if congress was acting in a different way. my question really is tied into what we were talking about with employment. if we construct our unemployment challenges between cyclical unemployment and structural unemployment, -- if we did construct our unemployment challenges, how do you think about the effects of monetary policy -- obviously, if monetary policy can be more responsive to cyclical unemployment -- how do

you think about the targets for unemployment in light of what you are seeing between cyclical unemployment and structural unemployment? i will respond to your first comment. i think a more balanced monetary fiscal mix would be better. monetary policy cannot offset what is happening in the fiscal sphere. it would be better if there were a more equal burden sharing between the different parts of the government in that respect. it is very difficult to assess exactly what the long run, natural structural rate of unemployment is. as i said before, for the most part, the reserve cannot influence the long run structure of unemployment except insofar as cyclical unemployment becomes structural unemployment, so we are focused primarily on our estimates of cyclical unemployment, and in particular, our forward guidance

gives a way station of 6.5%, which is a point at which we will consider beginning the tightening process. that does not mean we think that is the lowest rate that can be achieved, but that we have to get the process before we get to that lowest rate, or else we will risks overheating the economy. we have a projection, which is that the second condition, which is that if we see inflation beginning to rise, it would suggest that structural unemployment is higher than we estimate, then we would perhaps raise rates earlier. that is how we protect ourselves. the thing about the unwinding question, and as we look at some of the external factors we are observing, rates obviously low, market quite strong without any observation that there is a because corporate balance sheets are in very good shape, consumer balance sheets in

better shape than they have been in a long time -- if we were to do something significant in terms of the fiscal condition of the country, in your opinion, how much would that improve the fundamentals are around employment that would allow you to have more flexibility in your ability to unwind? if a grand bargain were to happen, how much greater flexibility do you think that provides you? >> it addressed it in your last comment, which i wanted to make, which is that i view this as a two-part policy. on the one hand, slowing the pace of tightening in the very near term, but at the same time doing things that will create greater confidence of our fiscal sustainability in the long run. i think that combination would be confidence-inspiring in the public in markets. it would help strengthen the economy certainly, and it would help take some of the burden off of monetary policy, and i agree with chairman brady that monetary policy is not

omnipotent. we are pushing pretty hard at this point, and there are a lot of headlines. it would make it certainly easier at this point for us to unwind. , all jobsn bernanke are not equal. in fact, in the last 20 or so years, about 90% of the jobs created have been service jobs, not science, technology, engineering, and math. we have a skills gap, a growth gap, which seems to be an intractable a employment gap, a shrinking middle class, and on top of that, a lack of growth in real income. in a speech you gave the other day -- and i do not attribute this -- you are attributing this to someone else -- the i.t. revolution, as important as it is, likely will not generate transformative affects that flow from the earlier psychological

revolution. as a result, these observers is likelyomic growth to be noticeably slower than the pace to which americans have become accustomed. apparently dr. kevin has said agrees with you or agrees with that statement of the american enterprise institute -- dr. kevin hassett. though the structural mismatch that employees have and employers need also plays a significant role. my question is -- how much of today's unemployment is cyclical and how much is structural? if a significant portion of today's unemployment is structural, then how does a highly accommodative monetary policy, as the fed is pursuing, boost employment cyclical or structurally over the long term? and if a significant portion of

today's unemployment is structural, do we expose ourselves to significant risk of price inflation in the near term by continuing a highly accommodative monetary policy until employment -- the the employment rate drops below 6.5%? on the first question, how much is structural, nobody knows precisely. it has to be estimated. f1c makes its own. if we have 7.5% unemployment now, it is probably a couple of percentage points of cyclical unemployment, which can be addressed by monetary policy. the rest probably cannot be addressed by monetary policy except that cyclical unemployment left untreated will become structural unemployment. in terms of longer-term growth, the comments you rest may be

clear that i laid out this view that, as you mentioned, of pessimism. i was agnostic about that. i think there are a lot of differences between the world today and the world of the 19th century when other inventions were being made. what is important about the difference -- the most important differences have to do with the amount of research and development funding, the skills available, the markets that make it very profitable to be first to market with a new innovation, since research, development, and technological process are good for long-term growth, we need to think about our policies in that area and try to do what we can to address shortages of stem workers, mismatches, assure that talented people from all over the world can come to the united states and participate in technical innovation. i think this is a very important

area. i am the first to admit it is outside the realm of what the fed can do. it is only something that congress can address. christ to eye. >> senator sanders is recognized. >> thank you, mr. chairman. yourld appreciate commenting on previews. number 1 -- i continue to worry about the growing inequality in wealth and income and this country. we have the absurd situation where the top 1% owns 38% the wealth in america. last two years, almost all new income went to the top 1%. i also worry about ownership with what is going on in wall street. we build up the long -- the large financial institutions because they were too big to fail, yet all 10 of them are larger than they were when we bailed them out. there is a growing feeling among many economists, including the

president of the --, that maybe the time is now to start breaking up these large financial institutions. the top six of which have assets it could lead to two thirds gdp of the united states of america. so i would like you in a second to comment -- is now the time to break up large financial institutions, which have unbelievable amounts of assets, and are in danger at some point in the future of once again being in a position of having to be bailed out? issue number two deals with the structure of the debt. , we have 12 fed reserve banks, which have nine members each. my colleagues may not even know this, but as a result of congressional law, of the nine members, three come from the financial institutions

themselves, three others are appointed by the financial institutions, and three come .rom appointments by the fed we have had absurd situations , the ceo ofdimon the largest financial institution in america, sat on the new york fed. reintroducing end what i to consider to be an absurdity of having sex out of nine members six out of feds -- nine members of regional feds coming out of financial institutions. the last question i would like fromk is the fact that the end of 2007 until april of 2013, financial institutions have increased the amount of excess reserves held at the fed from 1.5 billion to more than

1.7 trillion. one of the reasons that have occurred is that since 2008, the fed has provided interest to financial institutions to keep this money at the fed. a huge we see is financial pocketing huge amounts of money in the fed getting a small amount of interest. i think it would be much more productive for our economy if that money is outgoing to small businesses and into the productive economy rather than sitting at the fed. the legislation i am working on what address this problem by prohibiting the fed from providing interest to banks on their excess reserves and 2%uire the fed to impose a fee on the excess reserves of the largest peaks in america. in other words, get the money out. those are three issue that i am working on. i would love to have your comments on them. thank you very much. >> senator, on the last one, the amount of excess reserves

in the banking system is completely out of control of the banks. the fed puts those reserves in the system, the banks can pass them around to each other, but the total is given. they cannot do anything about that. it is like a hot potato. .25% interest we are paying them is not printing money from going out to small businesses or any other business. 4% now,e paying about prime interest about three point five percent. so banks can find attractive loans. of thetion, getting rid interest in excess reserves capacity would force us when we come time to tighten, it would force us to sell assets very quickly and in a destructive way instead of using that tool to tighten interest rates and avoid deflation. it would be very counter productive. >> we will discuss at more length -- breaking up large banks? >> that is a complex question.

many suggestions to break them up at either involved relatively small changes or a last eagle. -- banksl breaks separately got into serious trouble. i would support -- i think that we're doing if lot of things which i don't have have time to go through through dodd frank, through the order live at that order liquidation authorities to move into the other direction and addressing too big to fail. we do not feel that we have addressed that problem. i would certainly be supportive of additional steps. i think the best direction is probably requiring the largest firms to hold more capital for partially. that would force them to be safer, to have more even, more level playing field, and if their economic returns did not justify the higher capital costs to induce them to break

themselves up. >> structure the fed -- >> structure the fed. i am open to discussing those with you. i want to assure you as strongly as i can that the primary role of the board members is first to market insight, business insight. they are also helpful on operational issues. but there is a complete and impermeable wall between the board members and any supervisory matter. i assure you that there is no conflict. that being said, i could see what you want to have different people represented on the board. more union members, for example. i think that is a perfectly reasonable thing to talk about. >> thank you. representative paulson. >> chairman bernanke, i wonder if you could comment on what are the primary factors you are monitoring to gauge the economic risks of your current policies. federal reserve

policy has been at least somewhat muted by a strong deleveraging cycle, how important do you consider the expansion of bank lending or the result of the fed's own senior loan office he as a gauge of future inflation? and what other factors do you look at as potential precursors to an expansion of economic risks due to these policies? number of seen a things, which are suggestive that the effects of the financial crisis are being mitigated to some extent. as you mentioned, consumers are deleveraging their debt burdens and interest burdens are going down. their balance sheets are healthier than they have been. a smaller number of people are underwater in their mortgages, for example. banks are much healthier. regulatory role, we have been doing a stress test. we found that the largest banks have now roughly doubled the amount of capital that they had.

as that survey you mentioned indicates, their willingness to lend is improving in many areas. credit availability is improving. so a number of factors related to the financial crisis still seems to be moderating, and that is hopeful for further progress in the real economy. deflation -- we use models, we look at market data, we look at commodity prices, commodity futures prices -- we simply do not see at this point much sign of inflation. in fact, inflation is on the low side historically. if you look at market indicators, the very fact that the united states could borrow 30 years that under 3% is indicative that investors are

not anticipating a major inflation problem. we are incentive to that. that is half hour mandate. at the moment, inflation is on the low side. >> why do you think businesses are not investing so much? interest rates are really low, especially long-term interest rates. businesses into minnesota that say interest rates need to be lower. at what point can you comment, whether it is the tax increases -- you talk about the payroll tax in your testimony. the tax increases at the end of the year having an effect. at what point are the tax hikes on high-end earners as a part of the new taxes associated with the implementation of the affordable care act? in minnesota, we see the effects of the medical device acts. as aterms do you see it drag on the economy? >> first, we have been invested in hiring. they're not seeing the rapid

growth that would reduce them to expand capacity quickly. given the amount of growth they see, they have been investing, and employment growth -- as unsatisfactory as it is -- is probably stronger than you would have guessed given how much gdp growth there is. firms don't respond very strongly to interest rates directly in their investment decisions. a lot of literature suggests that. but but they do respond to final demand -- how many orders they have. indirectly, monetary policy stimulates capital investment is by generating more consumer demand through the fact that lower interest rates do affect consumer spending or raise prices. we have been seeing the last few reports on consumer spending have been surprisingly strong. we have seen improvement just the other day -- we saw a substantial improvement in consumer optimism. that is the monetary policy's best channel for affecting

investment. if firms see more demand coming in the door, then they will expand capital and labor. >> do see a drag on the economy with some of the tax hikes that have at the end of the year? >> i mentioned a list, including tax increases, illuminating payroll tax -- i am not pronouncing on the desirability or the -- of any of those policies. taking them altogether, they have the effect of being a drag on economic growth, perhaps more than necessary. >> i yield back. >> thank you. senator coats is recognized for five minutes. >> thank you. and imember nagy, you had a conversation, and i asked you the question about why the united states is doing relatively better than its neighbors across the sea, and you said it is because we have the best looking horse and the glue factory. i am wondering where that horse

is now. is our horse still in the glue factory, if the in the past are outside the glue factory, or he back in the form? >> it is clearly the case we're not back where we want to be. we have 7.5% unemployment. -- very lowry row ratio of employment to population. gdp growth has exceeded now where we were before the crisis, but we are still well below the trend of growth. that being said, i was struck at the latest meetings of the imf in washington recently when the imf economists were talking about a three speed local recovery by which they meant the fastest growth still taking place in some of the emerging markets like china. but the united states now breaking away to some extent from the pack, notably from europe and japan, and we have

had better performance. in the case of europe, it was about less than four years ago that the u.s. and the euro area had the same unemployment rate. today, our unemployment is 7.5, and the euro is above 12. so we have done better than other countries for a variety of reasons. not any single factor. but we are moving in the right direction. i do not think we could be as satisfied given where the labor market is and given that we still have unused capacity. >> you caution in your statement that too much restraint to quickly continues to be the headwind that we may not want to get into. but we have not addressed our longer-term problems. felt thementioned you 10-year window might be too short to do that. some of us are looking at more like 30 years relative to where

our growth will be relative to our debts. particularly the enormous spike in mandated mandatory spending, and the impact of that on the interest rate and the economy and so forth. you have suggested before that you have used a lot of the told, most of the tolls that the fed has to get us through this period of time, but ultimately that response ability falls here and with the administration. we have yet to summon the political will to address that problem. my take is that that begins in earnest in a relatively short period of time, maybe 2, 3, 4 years. it make it that we begin to address it now. chairman klobuchar mentioned some of that earlier. can you expand more on what you think our responsibility is? i am starting to hear things like the fed is buying its time,

therefore we do not need to take action right now. if the fed being an enabler for an addiction that congress cannot overcome? >> the fed is doing what congress told us to do. we are doing our best to try to promote maximum employment and price stability. congress need to take a longer view. interest rates arkwright -- rates are quite low today, but when the cbo scores budget plans out for a decade or two decades, it assumes that interest rates are going to write, which we hope they will because that will be a suggestion that the economy is recovering and coming back to normal. in looking at those 5, 10, 20 year budget plans, they assume highesr interest rates, and you will have to deal with higher interest rates as the economy strengthens. i very much support your suggestion of having a longer horizon. i would note the 1983 social security commission that my

predecessor chaired. the reforms introduced in then are still now being phased in 30 years later. some of these changes have long lead times. your concern about the low amount of interest return and the risk-taking or the reaching for a yield -- is this creating another potential bubble? there is a big surge in the market here that seems to be not enforced by underlying fundamentals. i would like your take on that. >> we are watching this carefully. nobody can ever say with certainty what an asset's price should be. our sense is, that major asset prices like stock prices and corporate bond are not inconsistent

with these fundamentals, for example, it was mentioned earlier that price-earnings ratios and the like are fairly normal in the stock market. thinking about the risk of financial stability, you have to look at things like leverage, credit growth, and other indicators that suggest not only is there some mispricing going on, but that mispricing of the possibility of gravely damaging the broader financial system. we are not seeing that to this point. it is always dangerous to predict, but our sense is that those issues are still relatively modest. they require very close attention. we will continue to do that. >> we're glad you are doing that because we do not want a repeat of what happened. thank you, mr. chairman chairman. >> thank you. representative sanchez as recognized for five minutes. >> thank you, mr. chairman. and mr. chairman, thank you for being before us.

you had many years when you were the crisis economic advisor, and now f chairman. i know you are sitting at the chairman, but have questions overall about our economy. i i would really like to get your idea on something in particular. i remember when chairman greenspan was before us, and i ilked to him about what thought a frenzy in the housing market. he just called it a frosting in a particular set of markets. of course, since having left, said that i completely missed what was going on. so i want to go back to housing because i think housing is such of theedible piece american families budget, their sense of wealth creation because in many ways it is a first step. it is traditionally what we have used to make small

businesses, to put kids through college, etc. so this is what i see going on now. around the nation, in a lot of markets in particular in california, housing prices are going up. everybody is cheering and everything. but what i see is foreign money coming in, money being bought as investments, banks sloughing off large amounts of homes and ,utting them into hedge funds these funds holding onto these and renting them out, anticipating that at some point, i am sure five or 10 years down the road, to get appreciation out of those assets. rental markets tightening, rent going through the roof, and your average working family -- at least where i live -- is not able to buy a home because of -- if you will -- haves who

have the money and the cash to come in and buy the home and in return -- not flip it, as we saw in the last speculation housing market, but actually hold it at a higher rate for rent to the families who now are unless we change something -- permanent renters. so the housing market getting better, but not for the middle -loweror the higher income class. and almost chaining them, i would say, into the inability to find their way to homeownership. do you see that going on? do your people see that going on in the different markets? do tohat can the congress to d ensure that too many people who

should not have been buying them bought in, but that what we would normally call the middle class and people who should be attempting to buy a home not get didht in this cycle of i not get in and i did not get a home. first, with prices having fallen about 30% and low anger -- low interest rates, affordability right now is the highest it has been in decades. so there are people who are able to buy now who could not have bought under other circumstances. although mortgage lending is tight for the people in the lower part of the cycle distribution. i agree with that. on the right side, many people who have lost homes or otherwise not become homeowners stop being homeowners have gone to renting, and rents have gone up have you said -- like he said. so it is probably a good market response that houses that were previously owned are now being available to rent, it is adding

supply to the rental market and will probably reduce the rents that people have to pay who are forced to rent. >> excuse me a minute, mr. chairman. there are people who had mortgage rates -- who were paying mortgages. we know that a good amount of these people lost their jobs. and that is why they were not able to continue their payments. but in most cases, what i see in my markets are lower mortgage payments that they were making versus higher rental payments -- again, the family is not getting credit or cannot get credit or even those who qualify with credit, cash offers from foreign markets are wiping them off from being able to own them. so what i see for a family unit is a higher cost of housing effectively than what they had pre-this whole problem.

>> again, if you can get a mortgage, the payments are low, and affordability is high. i agree with you -- if this is your question -- i agree that mortgage lending is still too tight. there are a number of reasons for that. if that's of conservatism on the part of some uncertainty about regulation. conservatism on the part of the banks. some uncertainty about regulation. reform, other things, fear of put backs that the banks still have -- so i think over time, particularly as has prices go up -- as high as -- as house prices go up, it is still relatively tight. >> chairman, all time is expired. senator lee. >> thank you very much. mr. bernanke, this quantitative

tends on the margin -- to encourage private sector debt, or does it at least tend at the margin to discourage private sector deleveraging? one hand, with low interest rates, we do want people to spend normally. we want them to be able to afford a house or a car. that is part of what put the economy back to work. , as thether hand economy strengthens, jobs are created, they get more income, and interest rates are lower. so those factors overall help people deleverage. as you look at data, you will see that that consumers have deleveraged quite a bit. does this quantitative even facilitate -- quantitative easing facilitate or promote the accumulation of government debt? by private citizens?

>> know, does quantitative easing have an impact on the accumulation of government debt? ditty margins make it easier for government to require a lot of debt? make ite margins easier for government to acquire a lot of debt? >> again, what we're trying to do is get a stronger economy, which will support higher interest rates going forward. as i have mentioned, any type of budgeting process that looks ahead more than one year has to take into account the cbo's estimate that interest rates will be rising over the next few years, and factor that in when you make your budgetary calculations. so i don't see how raising interest rates prematurely and causing the economy to relapse back into recession would be helpful to fiscal policy. i think it is important for congress to look at the five and 10 year window and look at

how interest rates are expected to move and make decisions based on that. extent quantitative easing does have these impacts that i have described, it does by way ofly encouraging consumption. >> writes, there is not enough demand in the economy. so it does encourage consumption. >> would net equity extraction from homes and increased leverage. in the mid-2000's -- >> there was a lot of equities traction from homes during that period. how much was due to fed policy, how much was due to lax lending policy, how much is due to regulation is a debated question. >> excessive leverage, whatever it it has caused, tends to

exacerbate the crisis that he rose to that -- crisis that arose in 2008? >> yes. >> didn't react to it? -- did it react to it? saw that the relationship between house prices and rent -- that house prices were very high relative to rent. house prices are -- were historically very high. therefore it was always considered a possibility that house prices would come down. in fact, when i became chairman in 2006, house prices were already coming down. so we certainly saw that as a possibility, but what we did not anticipate was how much damage that would do to our core financial institutions as it did. that led to the crisis. >> these things are hard to anticipate. >> yes. >> would it be fair to say that debt can create risks that are,

by their very nature, difficult to anticipate, and once they arrive, also difficult to address? >> excessive leverage can't create instability, but as i said, what we are seeing in household and corporations is a muchf deleveraging and stronger balance sheets, more equity in the case of banks and thes than we saw prior to crisis. >> so what would you say to those who might be concerned that we could be facing a similar crisis coming up as we saw in the mid-2000's? >> again, the indicators like asset prices, house prices, leverage, credit growth -- all those things look very different today than they did before the crisis. secondly, there is a whole lot of reform going on. very bad mortgages were being made, as you know, and there is

been a considerable amount of tightening up of the laws, protecting consumers. there have been considerable increases in the amount of capital banks have to hold and so on. a lot has been done. i'm not saying the work is completely done, but we have done a lot to make the system more resilient. >> i.t. white very much -- i thank you very much. >> senator toomey is recognized for five minutes. >> thank you. the nature of the accommodative monetary policy -- isn't it true as a general matter that very accommodating monetary policy has the tendency to the extents to be successful at all to bring economic activity that would otherwise occur in the future closer to the present day rather than to increase the total amount of economic activity that occurs over the long run? to some extent, that is

correct. but we have a situation now for example, homebuilding is well below what could be sustained in the longer term, so they were quickly we get back to the more normal level, the more quickly our economy will be close to full employment. >> be that as it may, i think it is an important point to consider that accommodating monetary policy is not really a net growth strategy. it probably have a bigger impact on economic activity than the total amount. >> we are trying to mitigate the effects of the recession, but we cannot affect long-term growth for a much at this rate. >> right. another point, just a quick follow-up. senator coats and senator lee alluded to asset bubbles that have occurred in the past. i think it is clear virtually everyone that we had a virtual housing bubble in the last decade. thist worry that

extremely accommodative and unprecedented policy can manage that -- can manifest itself in unpredictable ways. we see extorted early low yields yieldsxtraordinaryly low on junk bonds, it is very hard to know at any point in time exactly what an asset ought to be worth, but it worries me that this is going to manifest .tself in unpredictable ways the last point i just want to thee is you have discussed general strategy for exiting when that day comes. but always with an implication that there will be this orderly transition. i know you are aware of this, but i think it is important to underscore that it is hard to predict how the markets will respond when the biggest holder of a fixed income securities in the history of the world decides they have to sell them.

might decide you have to sell them. i know you may decide to just let them run off, but that may not be enough. i just think there is very significant risk that we are taking by accumulating a portfolio of this scale. do you want to comment on that briefly? >> i do not disagree that this is not easy and requires good communication. we have improved our communication. >> by the way, i would like to commend you for that. you have provided more transparency, more medication, more guidance than the fed has to my knowledge ever provided in recent history. >> thank you. i guess i would say there is no risk-free strategy. 1%, an unemployment is still high. we could address some of the issues. if it moves quickly and unexpectedly -- >> which might suggest the reason the market is where it is it because of the monetary policy --

>> the market things that monetary policy is creating more markets than growth. >> a quick follow-up to a, you have made any past about dodd frank, i have legislation to allow that -- much, if not all -- of that activity that is currently pushed out in the banks, which i think is a better way for a financial institution to manage risk and a better way for end-users to use these products. do you still share the view that it is a good you -- a good idea to repeal parts of the -- >> yes. the federal reserve had reserves about this prior to the enactment of the law and we thought concerns. minutes of the meeting contains notes on an august 1 in which there is a reference. i'm going to read a quote --

plans regarding the processing of federal payments, regarding regulatory policies as actions that the federal reserve would take if they pose a threat to the federal reserve's economic objectives. this was in the context of the debt limit impasse. clearly there were plans regarding how to deal with processing be fed payments and other things. could you give us a sense of what those plans and -- those plans consist of? not beemory will complete, but we look at our systems and our ability to make payments to principal and interest holders. for the most part, we found that we were able to do that with a few possible exceptions, people holding savings bonds and a few things that are not as easily connected to the system. ofalso had some discussion

the kind of policy we would have with banks. discount window lending where we leveraging.lted contingency planning if this were to happen. directlyid not do was engage the private sector for any contingency planning. we were mostly looking at our internal systems and our ability to address whatever directions -- we are the agents of the treasury. it is our job to do whatever they tell us to do. we were just working through our capacity both as an agent and managing be payment system and also as a bank supervisor to ifl with a possible default the debt ceiling was not race. >> ok, i see my time has expired. mr. chairman, thank you.

, thank youklobuchar for making this opportunity available. chairman bernanke, we are grateful for your presence here and your testimony. i have to say as well the work you have done to deal with this set of economic circumstances that we were have rarely faced in american history -- you have brought not just a lot of focus, but also a lot of passion, and we appreciate that. i want to focus on one issue. i am not sure it has been raised yet, but it would have been, it always bears even more examination. the issue is tax reform. if there is one area of real consensus in washington and across the country, there is a lot of consensus -- and here it happens to be bipartisan -- that we've got to simple five the tax code, we have got to make it a much more workable system for individuals.

the hard part is getting consensus in order to move forward. the good news here, and i don't want to oversight is, but it is important to assertive. to chairman. two chairman's working together and their staff to try to tackle this. and processes or mechanics under way in both places. for example every thursday in the finance committee, we sit down around a table for at least .n hour or more i think that is moving in the right direction. -- question i have for you did if the question is -- can you give an opinion or assess the impact, i am assuming it

would be positive, but i would like to hear about this, passage of a substantial bipartisan reform in the tax code? >> first, i would make the observation that such a major action taking on a bipartisan basis would itself be confidence inspiring. i think most everybody on both sides of the aisle agree that the tax code is extremely .omplex and distorts if it were done in a way that the bullfighter, made it more efficient and rational, i think that would be very positive. and yourat you colleagues can make progress on that. >> is there anyone part of the is of particular significance in terms of the adverse impact it has on either business activity or economic growth?

i realize it may be more than one, but if there is one that you think may be particularly difficult to manage. >> the difficult problem you face is the following -- most annomists would argue that efficient tax code is one of have a relatively broad base and .ow malt -- low marginal rates but low marginal rates are easy. broad-based means restricting or a limiting popular deductions and credits. that is the goal, but the political challenge is to figure out how to do that. in the income tax, for example, the biggest deductions are housing, charitable, state and local governments, and healthcare a vengeance, which are all very popular and have their own purposes. deal with thato

issue is the most challenging part but has the biggest payoff if you can find ways to broaden the base and lower the tax rate. >> i hear about a lot, and i know we all do. this sense that businesses have that there is various -- i say a big measure or substantial areas of uncertainty. one is the tax code, one is the economy, one of the areas of uncertainty is what the congress will or will not do or have not done. it is my belief we can get a bipartisan tax reform agreement -- it would remove at least one element of uncertainty. i know my time is almost expired. as a former chair, i want to be on the right side of chairman brady. [laughter] >> thank you, sir. representative duffie is recognized for five minutes. >> thank you, mr. chairman. to follow-up on mr. casey's questioning, i hope to get

bipartisan support for reform of our tax code, hopefully we will have bipartisan report and fair implementation of our tax code. but that is not this hearing. thank you for coming, mr. chairman. you testified with regards to the need to keep the big it's going with regards to monetary spigots goingthe with regards to monetary and fiscal policy. that you are going to drive interest rates down, that we should continue to borrow and spend on our end in the short term to help grow the economy and work on our debt in the long term. i'm sure you are aware of these numbers, but if you look at how we've spent cents 2008, the federal government in 2008 spent $2.9 trillion. in 2009, during the course of the stimulus bill, we spent $3.5 trillion. so the year of the stimulus bill, $3.5 trillion.

$.5 trillion jump. this year, 3.4 trillion dollars. so we are almost spending this year the same amount we spent in the year of the $800 billion stimulus bill. but your testimony today is that the cuts have been too significant, we need to actually spend more in conjunction with your printing. can you explain that a little further for me why we need to spend more when we are already $.5 trillion more in spending from fiscal year 2008? do not facee i spending. i talked about the whole whole package, which includes tax increases, a lamination of the payroll tax cut. put that together and it is a drag on the economy. the government -- since the stimulus, the government has been tightening its belt significantly. i mentioned in my testimony that there are a hundred thousand fewer government employees today than there were a few years ago. am not here to advocate

major new stimulus program. i'm simply saying that rebalancing between a somewhat slower tightening in the near- term and more aggressive and systematic attempts to address the longer-term imbalance where the big problems really are, i think that would be better. please don't misunderstand me -- i am not in any way denying the importance of fiscal responsibility. i just think it is not the best way to go about it to focus entirely on the short and ignore the long-term. >> and i would agree with you on that point. one of the problems in this town is that we see the long-term implications of the course that we are on. well aware of these politics in these two chambers in the white house. you have seen our side. theessively talk about long-term implications of our aging populations and the impact on medicare, and that is the

driver of our debt. you do agree with that, right? >> on the spending side, health- care costs and aging are important. >> what program does that spending come from? >> medicare and medicaid. >> so you know on our side of the aisle, we are trying to reform it and make it sustainable. one of the frustrations is we in with able to get buy- others to join us in that effort. it is wanting to say -- listen, i do not like the republican's plan, but then the other side has to put up a a plan that makes it sustainable, too, what you agree? >> we certainly want to do that, yes. >> both sides should put a plan to make medicare sustainable so they can negotiate, correct? >> i do not want to get into negotiations -- >> i'm talking policy wise. >> from a policy perspective, yes, we want to care to be sustainable in the budget overall to be sustainable. >> and we want both sides to put a plan to make medicare

sustainable, right? >> there needs to be a bipartisan way of negotiating whatever it is you need to do. >> one of my concerns with your testimony when you talk about headwinds with you do not talk about the regulations. when i talk to small business owners in wisconsin, they are concerned by the things you mentioned, but they are also considered -- also concerned about the rules, red tape. government is getting in their way when they're looking to expand and grow the business. when you have somebody looking to start a business, they will cite rules and regulations and government interference of a problem. i see that as one of the headwinds as well. that was a reference. i wonder if you see that as a concern. >> it is a concern. theseer whether regulations are ones that have just been imposed or whether they are ones that have been a place for a long time. talking about headwinds, i was looking at factors that were specific to this recovery as opposed to longer-term growth

issues. >> quickly, i know your term is up in january. if offered a second term by the president, would you accept? >> i'm not prepared to answer that question now. >> ok. some of us are concerned about the policies that have been implemented in the long-term impacts that will take a packed -- that will take effect in annex x month that will impact us years down the road. thank you for your testimony. >> thank you representative duffy for waiting for the very last moment to slip that question. chairman bernanke, thank you for being here. i think the fed played a critical role in calming the financial crisis. i do not know if i agree with the fact that everything good in the economy has occurred because of a direct monetary policy. i think the economy is more complex, more resilient. i believe at this point in the recovery, while very fragile, it is really a fiscal roadblock,

aside from europe and some other issues, really key to getting this economy going. we're going to continue to explore monetary policy, exit strategy, other issues in future hearings. chairman, thank you for being here today. >> thank you, sir. [captions copyright national cable satellite corp. 2013] [captioning performed by national captioning institute] >> nexon c-span, wisconsin senator tammy baldwin's's first speech on the floor of the u.s. senate then commencement addresses from members of congress, starting with senator al franken at the university of

.innesota then senator ted cruz next, wisconsin senator tammy baldwin delivering her first speech on the floor of the u.s. senate. she is the junior senator from wisconsin, and the first woman elected to represent wisconsin in the senate, and the first openly gay u.s. senator. she spoke for about 10 minutes. >> as i make my first remark on the senate floor, i have the honor of occupying the same senate seat, and in fact occupying be very senate desk once used by senator robert -- senior. republican senator from wisconsin a century ago. he was credited as the founder of the progressive party and progressive movement in his nature. manyire his legacy in ways. i wanted to assure my

colleagues who are present in the chamber at this moment that i will not any laid his maiden speech, which when on for three successive days. ran for this office because he was concerned that while corporate interests were being well served in washington, ordinary people were not even being heard. he traveled all around the state of wisconsin, literally speaking from makeshift stages .f so boxes at county fairs his message came to define my staple of the progressive tradition. the things he talked about in that day still ring true today. ,s i travel the state wisconsin has shown me that powerful, well-connected seem to stone right their own rules. while concerns and struggles of military middle-class families

go unnoticed here in washington. they feel like our economic system is tilted toward those at the top, and that our political system exists to protect those unfair advantages instead of to make sure that everybody gets a fair shot. washington happy to let wall street right their own rules. but unable to help students pull themselves out of debt. they see washington working to protect big tax breaks for powerful corporations but unwilling to protect small manufacturers getting ripped off by china's cheating. washington bouncing from one manufactured fiscal crisis to the next, but never addressing the real and ongoing crisis of our disappearing middle class. the truth is that while you hear a lot about the wide distance

between democrats and widest and, the most important distance in our political system is between the content of the debate here in ofhington and the concerns hard-working people in places like wisconsin. parallels the large and growing gap between rich and poor, between rising costs and stagnant incomes. between our nation and our competitors when it comes to education and innovation. .nd it is really hurting people when my grandparents were raving raising me, i learned a few worked hard, you can get ahead. the wisconsinites i talked to grew up learning that very same thing. they work as hard as ever to get ahead. many are finding that they

are hardly getting by. forle are still working them middle-class dream, a job , healths the bills coverage you can rely on, a home that you can call your own, a chance to pay for your kids' a secureducation, and retirement. instead, too many are finding that even two jobs are not enough to make ends meet, and those jobs are hard to find and hard to keep. but finding that the homes they worked so hard to own aren't even worth what still remains on their mortgage. they are finding that the cost of college is going up, and they are worried that they might never be able to retire comfortably. that is the biggest gap of all. the gap between the economic ites workedsconsin so hard to achieve, and the economic uncertainty that they are asked to settle for.

if we cannot close that gap, we might someday talk about the middle class as something we used to have, not something that each generation can aspire to. we all get it. we all see this happening. while wisconsinites do not agree about what we should do, they want to see us working together to find solutions. even if it takes some spirited debate. -- when they look at quads ink across that you divide washington, they see as playing politics instead of putting our varying experiences and talents to work solving these problems. but i am optimistic. i do not run for the senate just because i agree with those complaints. iran for the senate because think we can do better. i know that i have a great example to follow in the people

of wisconsin. are particularly tough times for my state. even as the national economy is rebounding and businesses in wisconsin and middle-class families in my state really remain stuck in neutral. the manufacturing sector that sustained our purpose -- our prosperity for generations has taken a lot of hits. some they could have been prevented, and others that are simply a factor of our changing economy and our changing world. don't see wisconsin workers and business owners wallowing in crisis. or looking for someone to blame. our state motto is one word -- forward. that is the only thing we know. in the short time that i have been here, i have made it my mission to fight to make sure ites have then

tools and skills that they needed to succeed in a made-in- wisconsin economy. that rebuild our prosperity. that means labor. it means investing in regional hubs of collaborative research and development. supporting the technical colleges that are working to provide us skilled workforce, and encouraging the public and private partnerships to revitalize our manufacturing sector. on theall relies talents of individuals who are working hard to help our communities move forward. , ars ago, john miller disabled marine corps veteran who lives near milwaukee, invented a new kind of motorcycle windshield that uses l.e.d. lights embedded in acrylic. for years, he's been working

hard to find investors and bring his ideas to market. he has been testing different acrylic, showing off his work at trade shows, spending months trying to get approval from the department of transportation. investors are lining up at john's door. harley davidson even wanted to buy his patent, but he does not want to just make a profit. he wants to make a difference. so he is holding out until he knows that everything in his product will be made and manufactured in the united states. hopefully by other disabled veterans who also have a hard time finding work when they come home. wisconsin is full of john people withinary ingenuity and determination and the civic spirit to become not just successful but engines of economic opportunity for their whole communities. committed to the common good.

all of theud of remarkable potential i have seen in wisconsin. the global water center in the walkie, which will open this .onor -- this summer the partnership of johnson forrols and u.w. milwaukee a research park. the advancement in energy efficiency technology being realized at orion energy in wisconsin. the work on sustainable biofuel at the great lakes bioresearch center in madison, and small business incubators at the technical colleges across our -- tohelping to big build the dreams of entrepreneurs. but the stories of innovation and cooperation, these exciting opportunities to build an economy made to last, these are happening all over our country.

i'm going to let people in on a little secret -- we here in the senate can be innovative too. we can cooperate. we can get excited by these opportunities. none of us did this to win our next election before the bumper stickers from the last one even, off the cards. i have already had the great joy of working with colleagues from both parties. i know that neither party has a monopoly on compassion or common sense. there is nothing liberal or conservative about wanting to in onn w our manufacturers the world stage. there is not a signature in this oddity whose heart has not been here.

we cannot fix all of those gaps with one bill. we cannot close that divide in the club -- political system with one speech. year tong my first each say that i am ready to work tod and work with anyone make progress on these challenges and help move this great country forward. thank you. i yield the floor. >> next, senator out franklin followed by ted cruz. then jameslyburn -- clyburn. the university of minnesota held its 50th commencement ceremony on may 11.

this year's speaker was al franken. the senate energy subcommittee chairman and former saturday night live performer spoke about energy sustainability and u.s. energy policy. forffered advise -- dealing with future success and failure. this is about 25 minutes. [applause] >> thank you. wasn't holly great? [applause] i told her i wish she would have shared one of those 25 drafts with me. [laughter] thank you, chancellor johnson, for your leadership here, for your stewardship of this great tradition of intellectual

achievement and engagement, and most of all for that really warm introduction. i want to begin by congratulating some people who truly earned a day of celebration. a day to take pride in their accomplishments and vinyl he relax a little bit after lifetimes of taking an impossible journey to get to this day. i'm referring of course to the parents of the class of 2013. [laughter] [applause] look, graduates, i will say nice things about you in a minute. [laughter] as someone who has been looking forward to having kids graduate from college myself, i can tell you your parents are every bit

as rob today as you are. they are also every bit as stressed as you during the endless application process, every bit as miserable as you the wrist time you got homesick, every bit as anxious as you when you had a big paper or a final exam coming up. your parents have grown up with you and gone through all the ups and downs with you for the past 22 years or so, including the four or five years you have been here. and they did not even get to go to the parties. [laughter] so please hug them. [laughter] later today and in the future a lot. got it? ok, sappy lecture over.

now it's time for you who are graduating today to give yourself a deafening round of applause. now! [applause] now, in the program, next to your name, it lists your degree like it's no big deal. like you showed up on campus four years ago. there you are. i can understand why they kept it short. if they really wanted to be descriptive, it should have been your name, where you are from, and something like "never made anything less than an a-in high school, and then she got a c and actually had to go to the professor for help" or "he auditioned for jazz fest sophomore year and did not get

in, auditioned junior year and did not get in, and then he ended up with one of these solar's and it was that the solos and it was spectacular" or " everyone in her family was a doctor, but she realized her passion was history and she had to go home for thanksgiving." [laughter] and she had to explain to her cardiologist mom why medicine just was not for her. many of you felt lonely. maybe all of you sometimes felt overwhelmed. many of you -- definitely all of your -- made mistakes. sometimes the states that at the time made you thought you had ruined your entire lives. but you are still here and you are getting your degrees.

it is incredible you made the dean's list or the founders club or broke some athletic record at school. is it in some weird way impressive you want strike eight red bulls in a row so you could finish a paper in one night? i guess so. [laughter] but i think the best part of what each of you has done individually is you know you felt uncertain, you know you screwed up at times, you kept going. you made it. congratulations. of course, well each of you have

accomplished so much individually, what makes this an extra special place is what you have accomplished together. this school's identity -- you can see it in the traditions of providing free tuition for native american students. you can see it in the government structure that actually gives students a real voice in how the school is run. you can see it and the way the college and the community's support each other. morris did not become a leader in technology by accident. and it would not be a world either if the community and the college had not worked together to make it that way. it may be the first school in the nation to have on your campus -- the money that gets pumped into the economy when you buy corn for the gasification

plant, the student-run recycling program that processes more than 200 thousand pounds -- 200,000 pounds per year. it all happens because everyone at the school considers themselves to be a member of this immunity and everyone in this community considers themselves to be cougars. [laughter] i know folks here have heard a lot, i know folks have heard a lot about sustainability and sustainable energy. you know who else has heard a lot about it? the other 99 members of the united states senate. [applause]

see, as chairman of the senate subcommittee on energy, i spend a lot of time trying to convince people out in washington that not only does sustainable energy and energy conservation really important, it is also something we can do. and as a senator, thank you. [laughter] and as a senator who represents this state, well, i spend a lot of time bragging about you in particular. at a time when too many in washington will not admit that climate change is a real problem, one committee is showing us what a real solution looks like. and you're doing it in a way that really exemplifies the best about what morris means. you are reaching out and

including everyone. you are organizing on the grounds instead of waiting for someone else to lead. you are bringing the change you want to see in the world. now, when it comes to the change we all want to see in this country's energy policy, well, it won't be easy. but you have proven that change can come from the ground up, and don't think for a minute that you aren't making a difference beyond this campus. a decade after morris made the commitment to become a green school, it encouraged other schools to be more like morris. princeton review surveyed nearly

10,000 college applicants this year, and 62% said the school commitment to the environment would affect their decision to apply. you are making a real commitment. that is what this school is like. you know, world class local art schools do not spontaneously appear. [laughter] morris was founded here in the middle of the night, america. because a group of ordinary citizens got together and decided a liberal arts college would be a good idea and got together to make it happen. no wonder morris turned out so many people who learn how to make a mark on the world.

working in washington the way that i do, i am run into so many morris graduates. go hang out in any minnesotan's office on capitol hill, it will not be long before you meet a friendly, passionate morris grad. someone like jerrod from the class of 1978 who is working with the board members of congress. i'm lucky enough to have a time of morris graduates on my staff. lana petersen is my state office and is one of my closest advisers. shelley schaefer, less of 1997, my deputy. adam, class of 2009, coordinate our internship program in washington.

cougars tend to find themselves in leadership positions and that is a good thing, if you ask me. we could use more people in washington who know what it means to work, who always thinks to reach out to the community. who understand how to work with others. to make positive change. i know that many members of the class of 2013 spent some time organizing on behalf of political candidates. i know that many organized for me, thank you. i know many of you may be thinking about which leadership position you plan to attain when you leave here. hopefully not mine. [laughter]

at least not for a while, ok? ok? [laughter] but even if you are in the politics business, you are thinking about what kind of leader you will become, what kind of places you will go and what kinds of things you will achieve. that's a fun thing to think about. and what makes the dream more than a dream, what makes it a goal is the impressive potential you have already shown right here at morris. and you guys are overachievers. something like 25% of you are double or triple majors. but all that potential can also

lead to a lot of pressure. especially because there are only so many nobel prizes to go around. some of you will walk out of here with a plan and execute it flawlessly. you will think you know exactly what you want to get out of life and exactly how to get it, and you will be right. you will never doubt yourself. you will never struggle. you will never make a mistake. good for the two of you. [laughter] as for the rest of you, remember the times you felt lonely, overwhelmed, the times he made mistakes, felt like the end of the world. that will not stop happening just because you got a diploma today. don't worry. this is not me telling you that failure is a better teacher than success. failure actually kind of sucks. and so do the useless platitudes

told by speakers like me at commencement addresses like this one. like failure is a better teacher than success. here's another one. it's lonely at the top. actually, it's a lot lonelier at the bottom. here's one i particularly don't like. when one door closes, another door always opens. first of all, that's not true. [laughter] and even when another door opens, sometimes it's a trap door. leading to that very lonely place at the bottom. [laughter] can i see the trap door?

oh, man, this is fun. now, all these platitudes aside, nearly all of you will experience failure. some of you will have failure you recover from. yes, learn from. yes, be all the better for, because once you have the failure, that's the only good option. too take something from it. some of you will never recover from your failures and statistically 2 in 5 of you will spend some part of your life in prison. [laughter] and interestingly, it's one of those graduates will consider prison to be the best thing that ever happened to them. [laughter]

just for the sake of argument, let's say there's a middle ground between the white house and the penitentiary. the middle ground in which you have a leg up over most college graduates, who in turn have a leg up over pretty much everyone else, but in which you are not exempt from anxiety and indecision, and yes, failure. i know it sounds like a mixed bag, especially considering this is supposed to be an inspirational speech. [laughter] but i have good news for you. you can make your mark on the world without conquering it first. and you can do it without leaving town. that may be one of the most important lessons you learn when you spend time on campus here at morris. morris is morris because

generations of students, faculty, administration, neighbors who selflessly gave up their time, their resources, their potential to make it the landmark campus that it is. mattie graduated in 1976 with a degree in philosophy and the talent for graduating -- four writing. she has spent her career right here in morris, hoping to lead this community by organizing alumni to give back and telling incredible inspiring morris stories to the world. doc carlson, class of 1965, made his alma mater come alive by making jazz his profession. making this camp is more

inclusive by incorporating different of different cultures into the life of the school. tommy roberts, class of 1968. could have been a history professor anywhere. he was a brilliant teacher. but he was a cougar most of all. a former leader in student government and came back and contributed decades to this campus. his wisdom and his loyalty and his wit touched the lives of what must have been thousands of students who no matter who they were or what they are doing today, just would not be the same without him. i am not trying to convince you

to stay in morris forever, although i bet mattie would appreciate that and you could do worse than staying in a community in close proximity to don's. but milkshakes do not count as breakfast after the age of 25. [laughter] i'm here to suggest you can make a big impact on the world by making a big impact on your community wherever that turns out to be. it's possible your path will lead you somewhere you never expected to be. somewhere far away from the place in your mind today. it's possible that your path will turn out to exist and you will just have to invent it. success does not always come the way you think it will. the word success does not always end up meaning the same thing you thought it would when you started out.

but whether you end up starting a business or running for business or discovering a planet or finding a job you like and raising a family and coaching little league and taking vacations, you are going to belong to a place. you're going to be part of a community area -- are going to be part of a community. if you're lucky, you will find yourself in a community just like this one, the one you have been part of for the past four years. but no matter what community you write yourself in, you will do everything you can to make it more like this one. no matter what you end up doing, no matter what your path turns out to be, and no matter how many false starts and wrong turns you encounter, you can always make a difference in the world by making your community a little bit more like morris, by making it a little more inclusive, by making it a little more fun, by making an example

for the rest of the country and the rest of the world. you are part of a select group of people seeing firsthand what a community like that can accomplish. although, as i mentioned, i spent a lot of time trying to tell other people in washington about the secret, with everything you learned here, whether it is what you learned about chemistry or history or anthropology, what you have learned is about organizing and coalition building and the rush you get when you change the world around you. the question is not whether you will make your mark. it is where. so what can i tell you as you get ready for this next step? don't freak out when you fail.

don't wear socks with sandals. [laughter] really. don't forget to hug your parents. beyond that, all i can really think to say is thank you. thank you for working tirelessly for social justice. thank you for setting a great example for the rest of us. and thank you for inviting me to this remarkable place to share this remarkable day with you. thank you. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2013]

>> ted cruz gave this commencement at hillsdale college in michigan. he talked about opportunity and of his father's escape from cuba as a teenager seeking the american dream. this is 25 minutes. [applause] >> thank you very, very much. thank you so very much. graduates, moms and dads, faculty, trustees, members of the hillsdale community. i am grateful for that warm welcome, and for that overly generous introduction. it was edward r. murrow who

described the ascension of winston churchill to be prime ministership in 1940. "now the hour had come for him to mobilize the english language and send it into battle." these are different times to be sure. but we are all justifiably proud of his leadership, his good humor, and his ability to send the english language into battle. today is a day of celebration. it's a celebration of your hard work, your commitment, time, energy, passion, and prayers that you have put into graduating hillsdale. it is a day of celebration for the sacrifice and dedication your family has put in to get you here. i'm honored to join you today. let me say i fully recognize the most forgettable part of the entire day will be the all addition -- will be the

politician they invited to be your commencement speaker. [laughter] today is the day your welcoming and celebrating with friends and family. but no worries. i'm in politics. i'm used to speaking when no one is listening. [laughter] indeed a few years back, i was on an airplane, and a voice came on paging tom cruise. somewhat sheepishly, i came to the run of the plane and i said, i think you may be looking for me. you have never seen so many disappointed flight attendants. [laughter] this opportunity i had a wonderful opportunity to tour the campus of hillsdale. i was taken to the top of the tower. i carved my name in the top of

the door. and the statue of margaret thatcher. i understand that statue was unveiled, she sent a letter of praise that said "hillsdale college symbolizes everything that is good and true in america. you uphold the principles and cherish the values which have made your country a beacon of hope." i could not agree more. i also understand that two of the men graduating today are the creators of that interesting game referred to as thatcher ball. i have no doubt that margaret thatcher would chuckle at the games only rule -- no murder allowed. [laughter] i'm not sure how she would react to the unusual way the score is tallied. [laughter]

there are commencement speaking held on campuses all over the country this spring. but this one here is different. hillsdale is known across the country as a class by itself. those graduating from other colleges are being told to go out and make something of themselves. before the 287 men and women receiving their degree your today, the expectations are much, much higher. because of the education you have received here, you are uniquely prepared to provide the desperately needed principled leadership to your family, your church, your community, your country, and your fellow man. while undergraduates have been exposed to college courses such as lady gaga and the sociology of fame -- and i feel quite confident the doctor will not be

teaching that in the fall -- you have been grounded in an understanding of our constitution and our government that our founders delivered to us. you understand that precious legacy and the need to preserve it. this past year, the world lost baroness thatcher. in her honor, i would like to spend a few minutes discussing the miracle of freedom. in the history of mankind, freedom has been the exception. for millennia, it has been nasty, brutish, and short. which is how some of my senate colleagues describe me. [laughter] rights were taken away by the

whim of monarchs area the british began a revolution in a meadow. as the magna carta provided to all free men of our kingdom, we have also granted for us and our heirs forever all these dignities written out before, to have and keep for them and their heirs. that revolution reached full flower in philadelphia in 1787 and the constitution that began from two radical premises. first that our rights did not come from kings or queens or even presidents, but on god almighty. as the declaration observes, we hold these truths to be self- evident that all men are created equal, that they are endowed by their creator with certain

unalienable rights and among these are life, liberty, and the pursuit of happiness. second in the constitution, the framers inverted the understanding of sovereignty. power comes not from the monarch on down, but instead of from we the people. and the constitution in turn lends authority to those in office for just a brief time. as james madison explained, "if men were angels, no government would be necessary. in framing government which is to be administered men over men, the great difficulty lies in this. you must first enable the government to control the governed. and in the next place oblige it

to control itself." in my short time in elected office, i can assure you there are no angels in washington. that is why, as thomas jefferson put it, the constitution serves as chains to bind the mischief of government. when government is limited, rights are protected and rule of law is honored, freedom flourishes. all of you know this already. hillsdale does not subscribe to the notion that all books published before 1900 are obsolete. against all odds, the college speaks up, as it did during the 19th century, for permanent things. with those foundations, what has freedom rocks? simply put, the american free market system is the greatest engine for prosperity the world has ever seen. freedom works.

no other nation on earth has allowed so many millions to come with nothing and achieve anything. and all the centuries before the american revolution, the average human lives on between one dollar and three dollars a day, with little difference between asia or africa or south america. from that point, the beginning of the american experiment, for the first time in history, per capita income in a few countries began to grow rapidly and none more so than the united states. over the last two centuries, the u.s. growth rate has far outpaced average growth rates throughout the world, producing per capita income about six times greater than the world average.

50% higher than the incomes in europe. put another way, the united states holds for wave five percent of the world population and produces a staggering 22% of the world output. a fraction which has remained stable for two decades, despite growing competition from around the world. america's predominance is not new. by the 1830's, the late british economist angus madison observed american per capita income was already the highest in the world in the 1830s's. this was the result of american economic freedom which enables on the norse of small businesses to flourish. today the u.s. dollar is the national reserve currency. english is the standard language for commerce. the strength of the u.s. economy allows us to maintain the mightiest military in the world, effectively

enforcing a pax americana. on culture, tv, the u.s. is preeminent in the world. 80% of the movies seen in the world are made in the united states. a disproportionate number of the world's great inventions in medicine, electronics, the internet, technology come from america. improving, expanding, and saving lives. america is where the telephone, the automobile, and the airplane were all invented. americans were the first to walk on the moon. we invented pong, space invaders, and the iphone. but most importantly, freedom produces opportunity. i would like to encourage each of you to embrace what i call

opportunity conservatism, which is every domestic policy which is conceptualized, articulated should be viewed with a laser focus to how it impacts the most vulnerable among us. we should view every policy through the lens. how does it impact the most vulnerable? the most fundamental difference between left and right is both look at the economic ladder and those on the left was to physically move people up the economic ladder, and that is almost always driven by noble intentions, and yet it never, ever, ever works. the only way anyone has ever climbed the economic ladder is to pull him or herself up one rung at a time. [applause]

as president reagan observed, how can we love our country and not love our countrymen? and loving them, heal them when they are sick and revived opportunity to make them self- sufficient so they will be will in fact and not just in theory? historically our nation has enjoyed remarkable economic mobility. 60% of the households that were in the lowest income quintile in 1999 were in a higher quintile 10 years later. 60%. simultaneously almost 40% of the richest households fell to a lower quintile in 10 years.

this is a nation where you can rise or fall, climb the economic ladder, based not on heredity, the blessings of aristocracy, but based on your talent, your passion, your perseverance, your willingness to fight for the american dream. economic freedom and the prosperity it generates reduces poverty like nothing else. studies over and over again five countries with higher level of economic freedom like the united states have poverty levels as measured by the united nations, that basket of conservatism, 75% lower than countries that are mostly repressed.

i remember some time ago of former texas senator, phil gramm, participating in a senate hearing on socialized medicine. and the witness their explained that government would just take care of us all. senator gramm gently demurred and said, i care more about my family than anyone else does. and this wide-eyed witness said, oh, no, senator. i care as much about your children as anyone. senator gramm smiled and said really? what are their names? [laughter] thanks to america's free-market system, the average poor american has more living a's than the typical nonpoor -- has more living space than the typical nonpoor worsen in sweden, france, or the united kingdom. in the year i was born, only 36% of the u.s. population enjoyed air conditioning.

today 80% of or households in america have air conditioning. and $.96 of poor parents stated 96% of poor parents stated they are children not go hungry during the year because they could not afford food. now there is still need. and all of us should act to help our fellow man. but more and more government is not the answer. to say otherwise is to ignore the fact that all major european nations have higher levels of public spending than the united states does and all of them are poor. human beings are not happiest when they are taken care off by the states. those who depend on the yoke of the government are among the least joyous in our society. we all flourish when afforded the opportunity to work and

create and accomplish. economic growth and opportunity is the answer that works. the prosperity and opportunity of the american remarket system gives us better healthcare, higher levels of education, the means to better protect the environment. no matter where you look in the world, the evidence is clear, as a strategy to create greater well-being, freedom works. the advancement of economic freedom, empowering individuals to decide for themselves where to work or how to spend or invest their resources outperforms government programs, centralized plants or increasingly regulated markets. it is for that reason so many millions have risked everything for a chance at the american train.

55 years ago, my father fled cuba. he had been imprisoned and tortured as a teenager in cuba. today my father is a pastor in dallas. to this day his front teeth are not his own because they were kicked out of his mouth when he was a teenager. when he landed in austin, he did not speak a word of english. he had $100 sewn into his underwear. i do not advise keeping your money in your underwear. he got a job as a dishwasher. he graduated from college. he got a job. he started a small business. he worked for the american dream. imagine if the minimum wage had two dollars an hour instead of hanging able to work for $.50. he may not have gotten that first job. i cannot tell you how many times i have said they got some well-

meaning liberal did not come to him when he landed and put his arm around him and said, let's take care of you. let me make you dependent on government. and by the way, don't bother learning english. instead, my dad like so many millions before him came seeking a better life. when i was a kid my father used to say to me all the time, when we faced oppression in cuba, i have a place to flee to. if we lose our freedom here, where do we go? my entire life my dad has been my hero. i will tell you what i find most

incredible in his story. how commonplace it is. every one of us here today has a story like that. we could, pier 1 at a time to this podium and everyone could tell the story of our parents or grandparents or great great rant parents. we are all the children of those who risked everything for liberty. that is the most fundamental dna of what it means to be american. the value of freedom and opportunity above all else. in 1976, margaret thatcher delivered her pivotal written awakes speech. she said "there are moments in our history where we have to make a fundamental choice. this is one such moment, a moment when our choice will determine the life or death of our kind of society and the usurer of our children. let's ensure our children have caused to rejoice we did not forsake their freedom."

if we do not fight to preserve our liberty, we will lose it. and each of you with a world- class education is perfectly situated to lead the fight. to communicate one-on-one with your peers and neighbors and colleagues on facebook, on twitter, with internet videos, with creative communication, to tell and retell the story of america re-. -- america the free. to so many young americans who have never had the opportunity to hear that story from the media, from the schools, and certainly not from hollywood. the 287 men and women graduating today are ideally situated to win that argument, tell that story. thatcher continued, "of course, this places a burden on us, but it is not one we are reluctant to bear it our freedom survives."

at hillsdale, you are all prepared to go forward. carry the torch for freedom so each one of us works to ensure that america remains a shining city on a hill, a beacon of hope and freedom and opportunity for the rest of the world. thank you and god bless you. >> james pieper and

has received early one degrees from around the country southing this in carolina. he gave this years commencement address, advising graduates to take chances and never give up. this is about 15 minutes. [applause] >> thank you. thank you very, very much. thank you very much, dr. rice. if i had good sense, i would keep my seat at this moment. but i don't have good sense all the time, so i'm going to spend a few moments with you this morning, offering up the commencement address. let me begin by thanking your

president, reverend tisdale. a good friend, and one i admire and respect a great deal. and i think his lovely wife, the first lady of this institution. i thank the members of the board of trustees for their tremendous leadership. i want to thank those participants in the program this morning. the vice chairman. mayor miller. chairman rice. but i want to begin my comments here today by sharing with you a little experience. several years ago, i was invited to do a commencement address at another college in this congressional district.

and two weeks later i met two young ladies who told me that they were in attendance for that commencement ceremony. they said to me they thought i had given a very good speech. so i decided that they to play devil's advocate. and i asked them, what did i talk about? [laughter] they looked at each other. and after a while, one of them said, i don't remember, but it was short. [laughter] so, i gathered from that experience that in order for a commencement address to be considered good, it must be short.

[applause] now, you are going to have a great speech today. [applause] first of all, let me congratulate each and every one of you on this great accomplishment. having been through this ordeal that you have been through, i know that you ought to be congratulated. secondly, i want to congratulate the administration, the faculty, the staff, all who contributed so much to getting you prepared for this day. i know president tisdale has asked you to stand already, but

i want to thank someone else. we are all very emotional about your accomplishments. we are touched, emotionally. but there are a couple people out here who have been touched financially. i want you to stand and thank them. stand and thank your parents, your guardians, who got you this far. [applause] there is a reason i asked you to do that. when i was leaving home to pursue my college education, my dad said this to me. "son," he

son, he said, the first sign of a good indication as good manners. i want to repeat that. the first sign of a good education is good manners. of all the things that you learned, please learn to say thank you. [applause] you will be surprised at how much that will mean to the people with whom you come in contact. the second thing i want you to learn today --to practice, that is, is the golden rule. all of you came to claflin university with a set of experiences.

each one of you has had a unique set of experiences which means that you see the w differently from the others with whomorld human directed -- with whom you have interacted all these years. when you leave here, if you pursue further education, if you go anywhere in the world of work, you are going to encounter people whose experiences will make them see the world differently from the way you see it. it does not mean that they are wrong. it doesn't eman that you are wrong. it simply means you can be no

more nor less than what your experiences allow you to be. so the second thing i want you to remember from today is to respect and honor the experiences of the others with whom you come in contact. treat them the same way you would like for them to treat you. you will be surprised as to how important it is to honor respect each other's experiences. i often tell the story that my wife grew up on a 22 acre farm. i grew up in sumpter. my wife grew up walking two and a half miles to work, school in the morning. two and a half miles back home.

my elementary school was three blocks from my house. my middle school, 6 blocks. and my high school, also a methodist school. so i do not know what it was to grow up the way my wife grew up. and i learned very early that i had to make some adjustments and i made them. and because of that, if i continue to make these adjustments until june 24th, we'll celebrate our 52nd wedding anniversary.

[applause] i want each of you to understand when you encounter others in the workplace or in the home, learn to respect each other's opinions. learn to honor each other's backgrounds and experiences and remember, it is those experiences coming into the home, into the work life, that allows you to grow and become some of the challenges you're going to face.

if you listen to the program, he has told you about all of his successors that i have had. .e did not tell you about this theid not tell you about failures. the first time i ran for office in 1970i lost. 1978.again in i lost. i ran again in 1986. i lost. whatend of mine said to me are you going to do now? three strikes and you are out. i said "that is a baseball rule." nobody should live their lives by baseball rules.

each and everyone of you must remember, you will will not always succeed every time you attempt anything. it grandparents told you. if at first you do not succeed try and try again. they did not say one or two more times or three more times. they said try and try again. not a single one of you can tell me how many times thomas edison failed. for hist remember him failures. f we member him for his success. each and everyone of you will be remembered not for your failures failures but for how well you overcome your failures. that is what you need to be remembered for.

to face theve here world, i have often wondered why people look upon commencements as the engine of something. end of something. that defies the dictionary. commence means "to begin." today is not an ending. it is a beginning. i want each and everyone of you to leave here today remembering remembering no matter how many times i may fail i will never give up. remember. i do not care how many times you , the next time could very well be the time. if you really wanted to honor your parents, your family members, your friends, this

administration, this great university, just remember that you should pursue your life's dreams. it is an attitude that you will never ever give up. if i had quit after three failures i never would have become number three in the house of representatives. [applause] let me say this to each and everyone of you. . congratulations. good luck. godspeed. i want to come back here and help you celebrate just like these platinum ones have celebrated.

andthis all come back in celebrate together. spicy but. godspeed. read jake thank you. godspeed. -- thank you. godspeed. [applause] >> i begin with integrity because it is so essential to who and what you ultimately will become. many of you have a career path in mind. many of you have no idea where you will end up. a few of you may be surprised by where life takes you. i certainly was. is not only what we do but how we do it. quite you know i have to start by tweeting this. i am a professional. it will only take a second. when i woke up this and started writing my speech i was thinking

of my first month on campus. ranked number one in the nation. september there was all this excitement on campus. our first game was at wisconsin. we went up there. we lost our first game. there was this crushing disappointment. i would like you to think of that soaring expectation followed by crushing disappointment as the metaphor for your next 24 minutes with me. >> the university of michigan commencement with robert mueller and rick scott. saturday at 8:30 p.m., business leaders including the twitter ceo dick costello. find more commencement speeches online at www.c-span.org.

>> next two more commencement speeches. first senator saxby chambliss, ldwin.ammy ba several thousand graduates of the university of georgia listen to senator saxby chambliss delivered the commencement address. he described the world as a scary place and talk about working to prevent another 9/11, boston, or oklahoma city bombing. this is 15 minutes. [applause] much.nk you very it is in a privilege and an honor to be here tonight.

president adams, to the trustees, fellow alumni, graduates, family and friends, thank you for allowing me to share this tremendous day with these individual graduates tonight and with this great institution that i am so proud of. now, there is another group of people we need to think tonight. and that is the proud parents and in particular all of the mothers who are here tonight on this mother's day weekend. to all the mothers -- [applause] havel you mothers who provided so much inspiration for these young graduates, let's stand up all the mothers and let's salute them for a minute. [applause]

and all you fathers, you played in this toy role but we have another month before recognize you. i also want to say thank you to my good friend mike adams for his leadership here. mike has been a leader on higher education issues across our state and across our nation. he has been such a valuable servant during his tenure here in athens. and we wish he and mary the best in whatever face their next life takes. tonight, we gather between the hedges to celebrate the graduation of more than 5000 women and men from this very special place. now i have to tell you i am a little bit intimidated. and that never happens to me.

politicians better not get intimidated or you are going to lose. but the reason i am intimidated is that i have been in this stadium. and on this field literally hundreds of times over the last 50 years. but i have never performed on this field. and i know that most of y'all here tonight are used to performers on this field like walker andherschel eron murray and yes, jason aldeen. how about jason? tonight, i am sorry, you just get the other guy. the university of georgia is not only a flagship institution and our great state and a world renowned school but is also a very special place to me personally. as president adams said, it is mater.

it is where more than 40 years ago, i met my wife. i love my wife. we are two children and six grandchildren later. you can see that uga formed not just a foundation for my career but one of the cornerstones of our lives. arexcited as i know you graduates to finally walk under the arch for the last time as students, i know that most of you are sad to leave this beautiful campus, but remember, today is about beginnings. in fact, webster's dictionary defines commencement as the act of starting something. you'll find that the friendship to have made here and the lessons to have learned here will ground you as you face the

choice as well as the challenges that will become a part of your. life your for you to seed the news these days and not worry about your generation and wonder how our will be treated. and it is easy to feel overwhelmed with how much the world has changed just in the time that you have been here at uga. the eventsther than in boston last month were single wasident, a joyouse event, transformed into a scene of life changing carnage. uncertaintyease -- is a powerful emotion. in my position as chairman of the senate select committee on terrorism, i your daily about

house. the world can be. i am privy to details that keep me awake at night. i also hear how dedicated young people like you day and night are out there working hard, foiling plots, taking down bad guys at preventing another boston, another september 11, or another oklahoma city from happening. i want to issue three challenges to your graduates tonight, and the first deals with this very topic. the world is in on certain place. it is difficult and complex out there. your challenge that i issue tonight is to bring surety out of unease, calm out of chaos, light of shadows and resolutions of questions. world, butnging

great change begets a great opportunity. just think of how your generation has forced a change and become leaders in the cause of freedom and all parts of the world. a round the world in such places egypt, libya, and syria, men and women of your generation have raised their forces, stood up to tear it, braved the beatings and imprisonment and risked their life and limb to bring down some of the planet's most notorious regimes. it was that change brought about by your generation that has given millions of people one of life's greatest gifts -- the chance to rule themselves. the things you have learned here at uga and how you build on those experiences will have a

direct impact on america's national interests and on our place in this shifting world. some of you will choose to join those already in uniform who are serving our country, and for that decision i salute you. others of you will serve our country differently. some of you will be in laboratories where you will tackle problems that could present by a terrorism or cure diabetes. in engineering firms, others of you will invent new technologies. thelassrooms, you educate next generation of america's leaders. helpsinesses, you will promote american competitiveness. and on farms, you will revolutionize agriculture with new technology. no matter what career you embrace or how you decide to fit in to this changing world, do it with dignity, do it with

passion, and with a spirit of community. and most of all, do it with excellence. now, to be graduating from uga means that you are all smart. despite some of you spending your free time sitting on beer --and drinking y'all know who you are. that was a lot more noise than what i expected. guys, butthese 4.0 the rest of you all. even so, just because you are here tonight tells me that all of your hard working and you are blessed with the most important ingredients for success in life. but listen, no matter how smart you are, no matter how good- looking you are, the matter how

talented you are, our athletic you are or how brave your, here is my second challenge to. embrace humility. why do i say that? because you are going to need it, because somewhere along the line, each of you are going to fail. some of you and more spectacular ways than others. alone. will not be here are some abject failures. oprah winfrey was fired early in her career as a reporter for being unfit for tv. herite finishing third in law school class, former supreme court justice sandra day o'connor could not even land an interview with nearly 40 law firms and was offered a job as a secretary. walt disney was fired from a newspaper job because he lacked imagination and have no good ideas.

former british prime minister winston churchill, who also knew about winning and losing, put it this way "success is the ability to go from failure to failure without losing your enthusiasm." who failed at, tryouts for his high school varsity basketball team, this wayd his career -- "i have missed more than 9000 shots in my career. i have lost almost 300 games. 26 times i have been trusted to take the game-winning shot and missed. i failed over and over again in my life, and that is why i succeed." ladies and gentlemen, you can count on three things in life -- death, taxes, and failing at something somewhere along the way. and i speak from experience.

my first run for public office was not a success. offact, in 1992, i got 30% the vote in the primary that i first ran in. but it is not about failing. it is about how you have an you handle it. you accepted as a challenge? humility is not a lack of confidence. in fact, it takes far more confidence to be humble men to be arrogant. but being humble will allow you to figure are who you really and what you do not know, what you can do better. every successful person has stumbled somewhere along the way, and most successful people have understood that only by increasing humility will they figure out a path to improvement.

augustine was queried, do you wish to rise, begin by descending. do you plan a tower that will pierce the clouds? lay 1st the foundation of humility. sitting fact you are here today in your caps and gowns been to our west. you are very fortunate. as the bible says in luke, for on to whomsoever much is given, required.hall be much and to whom men have committed much, of him they will ask the more. thomas jefferson put it a little different way. when he wrote there is a debt of servers due from every man and woman to their country. i hope some of you will serve your nation and a way that i did not mention earlier. and that is by running for public office. despite what the pundits, the

cynics, and even the polls say, is a noble calling. you are interested by voters to make difficult decisions, to write laws and set policies in change not just those policies and laws, but the very course of our nation. my final challenge to you is this -- get engaged. stateive at the local, and federal political levels. in your community and your country needs you. and in these uncertain times, they need your brain power and your gumption and your enthusiasm more than ever. travel inass you may life, there is no substitute for hard work and no shortcut to success. above all, and remember this, stick to your principles and be bold. most of you were lucky enough to

be bored americans. some of you chose to be americans. you should take every opportunity to understand what being an american means. others, the, engage curious about the rest of the world. america has long been lighted lamp, the beacon for the oppressed, the strivers and those who simply yearn for a better life. your country offers you a great opportunity for success. i have every faith that your future is so bright. it is yours for the taking. god speed you as you begin that churning and go, dogs -- that journey and go, dogs. [applause] offreshman senator tammy

baldwin as the commencement speaker at beloit college. she is the first openly gay u.s. senator as well as the first woman to represent wisconsin in the u.s. congress. this is 15 minutes. [applause] >> thank you for that introduction. faculty andank the administration and staff. and i want to thank and recognize all the parents and aunts and ucnles for, friends and neighbors in of helped make the members of the class of 2013 reached as proud moment in their lives. and especially for all of the bombs out there on the special

mother's dead. graduates, congratulations. this is such a special day for you. i can imagine your feeling a lot of different emotions -- pride, elation, relief? it must feel kind of strange to walk around campus without the weight of a final exam or a term paper weighing on your shoulders. i know exactly how you feel. privilege ofr representing beloit for many years. in every campaign, the college would oppose the debate. it does not matter how prepared you are. when you are sitting in the green room ready to take out your opponent, television cameras rolling, you know the feeling you guys got when there

were handing out blue books? same feeling. last year, i have the biggest test of my career when i ran for the united states senate. the voters honored me with a passing grade. i remember how i felt on election night -- proud, y es, elated, of course, relieved? you bet. but also a little anxious. after all, i did not run for the senate because i wanted the title. i ran because i wanted a chance to do the job. in the same way you did not come to beloit because you wanted a piece of paper you are about to receive. you came here because you wanted the chance to change the world in a short time you are in it. night,ke my election

today as a celebration, but it is not an ending. it is a beginning. it is a beginning of something fun and exciting, but also difficult and maybe even a .ittle scary some of you will challenge yourself to make new scientific discoveries or create new inventions. some of you will work on on locking the puzzle --or the mistress of the ages. some of your dream of publishing your work or standing on the stage at carnegie hall. on the you have your eye old office. -- the oval office. but all of you will confront the same questions producer -- how do i start? i spent my first few months as a

freshman senator confronting that exact question. i do not know what it is like for a freshman to give advice to seniors. the state of wisconsin in my campaign, i saw so much potential. and a lot of pain, too. beloit is to produce samples. classwe have a world- college. where students are doing incredible things. we also have a community outside the campus where unemployment is high. and middle-class families are struggling just to make it. how can the state where we made things for generations -- paper, tools, engines, and yes, cheese, can thed beer -- how

state be losing manufacturing jobs to other countries? how can a nation that boasts the biggest economy in the history of the world have so many roads going on repaired, so many businesses struggling to keep their doors open, so many people who have been out of work for months or even years? i decided i would run my campaign on a simple message. we can do better for our workers, our manufacturers and small businesses. howve a lot of ideas about we could do better. how we could level the playing field for our worker, how we could make our taxes fair, how --can rebuild our what was in the senate, there was that question. now that i have the chance to solve the problem, how do i

start? many of you will find a way, you'll have colleagues who are not on the same page. you'll be told to wait your turn to speed. after all, you're new. and you will have to work really, really hard just to make the smallest amount of progress. that is what i found in my new job, too. washington,slow in too slow. and they do not always move in the right direction. at the endto leave of the day to know we have not found a job for everyone who wants one or given every child a chance to attend a great public school or making sure that every family has good health care. it is hard to let the sun go down knowing that we still have not resolved our fiscal crisis addressn steps to -

climate change or make sure that every american can marry the person here she wants. or 18hard to imagine 6-12 years in this amazing job that we will not reach the finish line on some of these issues. there are days when it seems like the world is too big to get your arms around. i will tell you what i think about to get me through those things and to get up every morning ready to get back to it all. mathve it or not, i was a major in college. and i had this professor, a terrific professor. i was a pretty sharp student, but my first class with this professor was a real tough one. -- [indiscernible]

the professor did something in that class that took me completely by surprise. insolvable us problems, problems with no solutions. we were not expected to come up with the answers, but we were not expected to -- we were expected to show progress. i never figured out any of those problems. there was a reason i became a politician and not a mathematician. but over the course of my career, i thought back to that class many times. was thatssors points by pushing against the boundaries of what we knew we could expand those boundaries. after all, every problem starts out as in soluable, but people keep pushing, keep making

progress. eventually someone goes ahead and cracks it. how do you cut away the area of a circle? how do you build a computer for less than $1 million? how to govern without a king or queen? once upon a time, all of those were insoluble problems. nobody solve them all at once. nobody solve them all alone. but we solve them. just like we rebuild our country after the civil war. we rebuild the world after world war ii. just like we planted our flag on the moon. do not be afraid to take on the and soluble problems you encounter. solvell not be able to them by yourself. but you will make progress. and maybe you will help someone

else make progress alongside you. i was raised by my grandmother. she was born in 1906. she wanted to be an astronomer. but the times and her families circumstances dictated that she learn to sew. my grandmother was an incredible artist. she made it all of my clothes until junior high school, when i remember asking permission to buy a pair of blue jeans. she could not compete with levis. she was so proud when i graduated from college and even prouder when i ran for office. at the age of 92, she watched

me get sworn in as the first gay woman in the united states congress. [applause] . . the newspaper, she looked out the article and and save it. she has all those clippings in the drawer of her nightstand. on top of that nightstand, she kept a photograph of my cousin jennifer, her first great- grandchild. she will look that photograph every night before she went to sleep. i don't know what was going through her mind at those moments later night but i think - late at night but i think when she saw the photographs, she would think about how much things had changed since she was born.

how our country have become more fair, wiser, a better place. how great men and women had made such incredible scientific discoveries and build incredible buildings, bridges, factories. she must've been marveling at what lay ahead for jennifer but i hope she was proud of the progress she made in her time, the progress i was beginning to make in my time in the progress jennifer would someday make in her time. you ha\ve -- have been a part of a legacy progress that stretches back to the day when wisconsin was a frontier society. you are also part of a legacy progress that stretches back to the founding days of this country, a legacy that includes countless inventors, explorers, thinkers and statesmen.

yes, we have big problems to solve and yes there are days when they seem insoluble but i am confident that you and i can make this progress together. we work and work just to get to the starting line, it could could be hard to know how to take that first of forward but i'm confident you and i can figure it out together. potentially all the of shown here at beloit and the progress we will make in our time. congratulations, class of 2013. [applause]

more ofht on c-span, this year's commencement speeches from congress. minority leader nancy pelosi at the university of baltimore, followed by new york congressman peter king. then the framingham commencement address by elizabeth warren. an senator mark warner delivering george mason university's commencement speech. >> i begin with integrity because it is so intentional -- essential to who and what he will ultimately become. many of you have a career path in mind. many of you have no idea where

you one that. -- where you will end up. a few of you may be surprised to where life takes you. in the end, it is not only what we do but how we do it. >> you know i have to start by tweeting this, so give me a second. when i wrote up -- when i got up this morning and started thinking about my speech, i thought about my freshman year here. the football team was number one in the nation priest is in -- nation pre-season. our first game without wisconsin. we went up there and we lost, 20 1-14. it was crushing disappointment afterwards. i would like to think -- like

you to think of that as a metaphor for your next 20 minutes with me. >> next weekend, more stories and advice for graduates with administration and state and local officials, including the fbi director and florida governor rick scott. saturday at 830, a business leader, including the twitter ceo and apple co-founder steve wozniak. find more commitments because c-span.org. lastcovery continues after week's oklahoma tornado. >> we are a disaster survivor -- survival specialist. the states request a declaration of disaster from the president.

we get activated as reservists and come out to the site, which starts at the local jurisdiction, at the local level. we go house to house. we make sure they register with fema. we haveneed housing, volunteer agencies. have proper they housing and food. .egister with fema they can also go to the website disasterassistance.gov. .e resisted them on-site we can register by phone. we are out there in the field

talking to the survivors face to face. >> good afternoon. i am with the muck. my name is patrick. i have come by to give you registered with the muck. getre -- we have come to you registered with fema. is a team based national and community service program for ages 18-24. is solely focused on disaster recovery and really. the disasterf survivor assistance service. we register people in the field. we commit the next 10 months of our lives to responding to disasters. ofwe also saw what remains

the elementary school in moore. in thedren were killed tornado. you won't hear from sergeant jerry lewis. he is with moore's police department.

>> this is the main office area. this is one of the main hallways. there are classrooms on each side. children just down at the very end in the bathroom in this hallway. the cafeteria area.

this is the gymnasium back here. there were some kids actually in the gym, in the hallway. this is a classroom here. you can go into some classrooms if you like.

we are standing in what was the first grade classroom. . this is a hallway. going this way. this is actually the only classroom that is not totally discouraged. you can get an idea of what the kids were doing as the tornado came. what they wanted to do when they grow up. >> what grade classroom is this?

>> this is first grade. they were down here in different areas. the teachers from these two classrooms and those two classrooms and this one right here. all of these teachers that were down this way actually went into the women's restaurant. it was too painful for the rest of them. the guy -- the idea was to put up as many walls as we can. there was this fall and another exterior wall. all of these people survive out here. sold the walls --

>> the walls collapsed. the vehicle went through that wall and that wall where we are at. what is weird is this tornado came from the southwest. when it got into moore, it went three blocks and then it went straight east. as i followed it, it stayed straight east and then it went a little bit north and continued east, went about a mile and half

and started going south east. to donot real, and for it that. usually, they continue northeast. this one may direct animals. angles.t it was over the school to win the have-3 minutes. it did not just move through. it was a slow moving tornado. you watch it to see where it was going wasrght -- it was going, right? stayed and went through southeastern. my daughter's school is there. that is where i was trying to go. people started yelling for help. a lot of storm shelters were covered with debris. a lot of things you do not really think about having to

deal with that. that is where it started. fine.me was my daughter's school, the gymnasium was torn up. nothing like this. no one was killed at her school. >> president obama will travel to oklahoma tomorrow to see response and recovery efforts firsthand. he will visit with the families affected by the tornado and thank first responders. live coverage of his visit here on c-span.

education secretary arne duncan testified on his department's 2014 budget request, which include $71 billion in discretionary funding. he addresses early childhood education and loan interest rates and waivers for no child left behind. from the house education and labor committee, this is the two hours and 10 minutes. >> thank you so much, mr. chairman and members of the committee. on the oklahoma situation, i the states lieutenant governor. to the publicll school superintendent this morning. she is a 40 year veteran retiring at the end of june. i want to thank all of the heroic teachers and first responders. there has been significant loss in the life of children.

amazing work done by teachers and administrators and first responders and all of our thoughts and prayers are with them this morning. i am pleased to be able to talk to you today about president obama's vision for investing in education to ensure equality of opportunity for every child and delivered a strong return on investment for the taxpayer dollars. i is important, especially in tough economic times like this. i will ask you to visualize and keep in the back of your mind 84-year-old little girl. 4- the end of the day -- a year-old little girl. it is about the choices we make for a real families and real children. i think and i desperately hope that we all agree that improving our education outcome is a vital national interest that we all share. the decisions we make will have a major impact on our economy,

on our economic competitiveness, and on the four-year old girl's chances to have the good life she deserves as part of a thriving middle-class. that is a core american values. right now, it is in danger. we have lost our place as the global leader in college completion. .e rank 14th we should be embarrassed that we have fallen so far behind our international competitors. we want good jobs to stay in this country and not migrate overseas. let's start by looking at what is happening with young adults. doing betterre than france, britain, japan, chairman, canada. by 2011, we were doing worse -- japan, germany, canada. was said that the united

states has lost its large lead in producing college graduates. education remains the most successful strategy in a tech- heavy economy. we are trying to come -- improved opportunities for every child to make the united states the global leader in college completion. we have been working four years to raise standards, improve teaching, established systems, takes the most broken schools, and make college more affordable. we have made some real progress. next slide, please. you asked, have we made progress. the progress was not fast enough and we have a long way to go. but we have made progress. high-school graduation rates are at their highest level in over three decades. we are on track for a 90% graduation rate by 2020. next slide.

at high schools where 40, 50, 60% or more of young people are dropping out. we have had 700,000 fewer children attending dropped out factories. those young people have a much better chance of not just graduating, but going on to some form of higher education. go on to the next slide, please. we know that delaware grants go to first-generation college course and english language learners -- we know that tell -- grants go to first- students andllege english language learners. these people may not have had the opportunity to graduate from college. next slide please. the enrollment rate in college

has gone up and live in, particularly in the african- american and latino population ,- has gone up significantly particularly in the african- american and latino populations. 32% of hispanics attend college. todayn-americans, 38% versus 30 in 2000. real progress, but a long way to go. but we feel good about that. the congressman talked about the flexibility in each state. that is going absolutely in the right direction. we will fixed no child left behind in a bipartisan way. -- we will fix no child left behind in a bipartisan way. work aheadot of hard of us. next slide, please. too many low-income kids and

minority children are not receiving the education they need to reach middle class. let's look at these numbers starting with high school. 19% of the students from the high income groups complete high school. less than two-thirds of those who come from the lower economic quartile do. the next slide is even more stunning. in 10 low income children eventually graduate from college, less than one in 10. compare that to more than half of our high-income students walking across the stage. not enough, but a huge difference in the outcome. think about what that does and how that hurts us as a country in jobs and our competitiveness and what it means to the lives of children and families trying to escape poverty. next slide. how do we change the odds. i want to read you a quick

quote from a nobel prize-winning economist. he says, investing in disadvantaged young children is a rare public policy with no equity-efficiency tradeoff. it reduces the inequality associated with the accident of birth and raise the productivity of society at large. what is the most important single thing we can do in the education to change outcomes i have talked about. i am convinced it is investing in high-quality preschool. low income children start school 12-14 months behind their peers in language development. that is morally and educationally unacceptable. we know how to fix this. this is one of the few public investments with no trade-offs. investment for

high-quality preschool is so high. seriousntry, we are not about preschool. the united states ranks 20 28th in thee -- enrollment of four year olds. if we expect to compete effectively in a global economy, we have to invest in what matters most and what makes a difference. preschool fors all proposal can be a game changer extending quality to the kids and communities that need it the most. it is a major investment in capital on a major issue. think about that 4-year-old girl. whether she is from minnesota or north carolina or california, she deserves a rich environment. she deserves the chance to

develop for cognitive and non- contours of skills. she may not have a home life that can -- than when and 9- -cognitive -- non skills. macy's and theof former ceo of procter and gamble have written that universally available pre-kindergarten is not only the right thing to do, but the smart thing to do. other countries have realized this. china has set a goal of giving 70% of all children 3 years of pre-kindergarten education. why is it? because of the return on investment. for every dollar we invest in preschool, that dollar returns $7 just in public funds. some of that comes through greater productivity. some of it comes through reduced need for cash handouts. almost $3 of every $7 comes from

reduced costs of crime and jail. think about that one for a moment. we should ask ourselves. preschool or prison? where do we want to invest? will cost less and of society more? the answers are obvious. earlyable, high quality learning is the best thing we can do to help children and help strengthen families. i can tell you what does not help. incoherent cuts to programs that serve our most vulnerable students. houset address the appropriations committee allocation. it represents a cut of 22% from fiscal year 13, pre sequester level. -- kissell your 2013, pre--- pre-sequester level. it would represent dumb

government dumbing down america. it would multiplied the damage of sequestration, which continues to hurt low income, special needs students, young families counting on our head start programs, native american children, and communities who schools rely on aid. together, we can choose another pass and make smart, strategic, long-term investments. let's return our focus with -- to plans with positive roi. president obama's early learning investment aims to prepare students for college and for work. we are working to strengthen the pipeline with an emphasis on college completion, which is the ticket to a solid middle-class life. low on interest rates stood alone will require your action before july 1 to prevent those rates from dublin. we know you share that concern. we need to keep working with you

to find an approach that will keep college affordable for students and families now and into the future. to make college more acceptable, we have developed simplified paperwork to make it easy for families to access student aid. flexibility has provided crucial space for innovation and system- wide improvement. under esea flexibility we are seeing states raise standards and hold more schools accountable for the learning of students with special needs and minority children. far too many of whom were literally in visible under no child left behind. we have also acted to improve services for those students with special needs. we have requested hundreds of millions of dollars in increased funding in addition to the