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 unprecedented $11 billion

provided under recovery acts, students with special needs, including significant improvement at the preschool level. we are focusing on needs in the rural communities. each of our grant proposals will include criteria are priorities targeting or areas specifically. we welcome the input of congress as we work to ensure that all of our competitive grant programs give strong opportunities to brous schools. we want to see a community in america have excellent opportunities, our children and our nation deserve no less. what that improved opportunity at up to is and turned -- is a return investment. according to a recent study the benefit of a college degree compared to an investment that would turn 15.2% per year. we know that the engines of our economy and its global competitive environment is the best educated for force in the world. it is the only way to build a strong, vibrant, and growing

middle-class. we know that giving every child an opportunity is the right thing to do. it is who we are as a country. the most much and i look forward to your questions. -- thank you somewhat and i look forward to your questions. >> thank you, mr. secretary. you may be some bared my questions -- may be scared my questions entirely. it is part of -- may be s pared my questions entirely. it is part of my strategy. i want to talk about your proposal to move to market-based interest rate on all federal student loans. as you know the basics of your plan and the administration's plan falls largely in line with our goals for student loan interest rates. for example, your proposal moves to a market rate interest based

-- market-based interest rates on loans. your proposal is based of of the 10-year treasury note, so is ours. you have three different formulas for calculating different student loan rates, i thought it would be better to narrow it down to two. we need to get our proposal as close to budget neutral as to could -- as we could. your proposal is a little different, costing 28.9 billion over five years and saving 6.8 billion over 10. it attacks students in high interest rates environment -- our bill includes a reasonable cap. your legislation does not include a cap expands the income base for payment program bringing the total cost of your proposal to $33.4 billion over five years. i would say our proposals are pretty close and others agree.

a quote from the washington post , "this yearsterday president obama proposed taking a loan rates to the rate at which the government borrows plus a relatively moderst markup. its bill may reach the house floor this week. it will indeed reach the house floor this week. continuing backers of the president's plan say that the proposals are designed to be budget neutral over 10 years. there is no reason to delay passing such a policy." have some competing ideas. at one to get you on the record as to where the administration stands. we are going to go to an interest-rate debt is paid to the market for a long-term solution or are we going to keep kicking the can down the road? generally have to

start taking up tough issues together in a bipartisan way. we have to think for the long haul. we are very interested in long- term solution. we are interested in this being budget neutral, not try to do -- not try to reduce the deficit. i appreciate your thoughtfulness and the idea of coming back every two years to try to fix something is just a very -- with all of the real challenges the country is facing and what is going on today in oklahoma, we cannot think long term. we cannot move on to other issues. i just cannot understand that thinking to give we are interested in a long-term fix, interested in it being but neutral, and trying to find some common ground. >> thank you. i hope we can continue to work together. i mentioned this briefly to you earlier today so i am going to ask you give me some

information for the record. the regulatory flexibility act of 1980 requires federal agencies to publish in april and october semi-annual regulatory actions that are being developed. further the executive order requires agencies to publish every six months the regulatory agenda, including all the regulations under development review. last year for the first time since 1980 we had and the administration that cannot publish the spring agenda at all, just skip it. when an apology can do they let that go past until they published it on december 21. we haven't seen such an agenda. my question to you is can you tell us when the department of education submit its input to onb?

>> on may 8. >> thank you very much. that is what you bring them, they are smarter than i. i just wanted to make the point again about the administration bringing forward a new proposal. you explained and talked about early education for 4 year olds in the country. it is a cost of over $70 billion over a tenure. and you really didn't do anything. -- of $70 billion over a 10-year period. and you really didn't do anything. i ask what you said the most important thing the government can do for you. it is to meet the government's obligation to fund special education. i am disappointed and my time is expired. mr. miller? >> thank you, mr. chairman

tweet thank you for your comments on the allegations. you, mr. chairman. thank you for your comments on the allegations. there is a big difference between the president's plan and the republican's plan. you what the students into the long-term benefit of lower interest rates today as opposed to the variable rates which locks them in at a much higher rate later on and they do not know the cost of college is going to be. i want to go back to the point i was making with respect to the waivers. i want to make very clear that there is an understanding between us that no child left is more successful in mitt many ways. you may remember when president

bush said the systems had the biggest -- had low expectations. the fact was that these students were hidden, their performance was washed out by averages and cannot go back there. i am glad to see what is happening on graduation rates that we have to understand that the graduation rates have to be real and we now see some states suggesting they want to do something that is a sub- g.e.d. i have no problem recovering since that did not make the four-year cycle. we have seen successful efforts in new york state to do that. before that no child left behind, students cannot read the diploma the board granted. now the question of what the diploma means to an employer. we have to maintain the integrity in the system as you

go through the renewals on this round of this question. as we know we had dropped out factories that were losing 50% of students upon graduation. point made. finally i want to thank you so much for emphasizing early childhood education. it is very clear the benefits of early childhood education did i realize there is if that amongst the educational leaders suggesting that perhaps it makes no difference. i always find that interesting when you know how much rich people are prepared to take for the early childhood education and development opportunities. people pay $50,000 per year for

that experience in washington d.c., a major metropolitan areas, seeking to have their jobs have that advantage of starting school. -- have their child have that advantage of starting school. we put them into a terrible school and we say it did not work. lose compass and see if i was in some of these schools. this is a continuum. all the signs that we have learned about bring development, about skills development, about vocabulary acquisition and of those fundamental skills tellus this is a very wise investment. as i understand it, we're still in the drafting stage of the president's program -- basically he is providing money to states for states to make the decisions about -- all have to do is be willing to invest in high- quality, to improve the quality of the existing system and expand participation. they decide how they want to allocate this in the early drafts that i have seen.

this is about as providing resources to help the state meet the demands and quality issues. >> i will try to respond to each of your points. on maintaining high part of commitments and waivers please know you have my commitment. i appreciate your leadership. one of the biggest benefit of the waivers the people to not fully understand is that there are electorally hundreds of thousands of children with special needs, minority children, who were invisible under no child left behind. it was not the intent but it is what happened. they can now hold themselves accountable for children's that did not exist on the previous accountability system. that is a huge step in the right direction. on the health budget, to be clear, and she'd your commitment to try to find more for special needs children. with the house appropriations 302b allocations' there would be a cut in funding of $2.4

billion. it is clearly not going in the direction that you proposed. the investment of early childhood education with the two reduction would lead to reduction -- would lead to reduction. this is the best investment we can make. we have a nobel prize-winning economists that come to this and talk to a minimum of seven-to- one return on investment. we have to get out of the dysfunction. we have to stop thinking short term. this is a long-term play. the benefits are 30 years out. politicians are too wide to think about the short-term and election cycles. if we invest in high-quality early childhood education less chouthree in 10 -- early of education -- less than three and 10 students have access to

high-quality education. it is an option. i am hopeful about this because we see governors in a bipartisan way, republican and democrat, who are investing their significantly in early childhood because they get it. we just want to partner with states that want to invest in themselves. >> the time has expired. secretary,ment, mr. i do battle with my own party on special education as well. whatever those issues are does not change the fact that once again the president has, in my judgment, ignored what should be a commitment an obligation to the federal government. >> thank you, mr. chairman. thank you, mr. secretary for being here. the program integrity the commissions have been the center of intense scrutiny from the higher education community and that was met with both sides of the aisle in congress.

you recently announced the department plans to read- regulate gainful employment. the house has had strong bipartisan vote opposing both of these regulations. why'd you continue to pursue flawed regulations and what changes are you considering? >> part of what we are doing is hearing public comment and did good feedback. we welcome good feedback. what we wanted to very simply is to have on the painful side -- if we are going to hit the president possible we need everybody -- students with real skills -- >> are you willing to make the gainful employment apply to everybody in higher education? >> we talked to a number of issues here. my point is what we want to do is make sure that real training is leading to real jobs. what we wanted to see that happen more often when you have

a spokesman going into greater debt and not having an opportunity -- you have folks going into greater debt and not having the opportunity. mr secratary, my colleagues will tell you i am sensitive about the were "training" as opposed to "education." i think we educate people and train animals. it is one thing to say states must authorize institutions that operate within their state, it is entirely another to dictate how these states are to do it. if you do not agree with it punished students that are attending the institutions in the state. >> we just want to make sure that we want to lead the world

in graduation rates. we used to lead the world. i should be ashamed of that, you should be ashamed of that, we all should be ashamed of that. we should make sure that all of our taxpayer dollars are doing a good job of educating people. >> one more thing on the state authorization, you issued a "dear colleague" letter in march 2011 about how the state can come into compliance. you have extended the deadline twice. can you identify which states only to come into compliance and what of this has been given to them? >> i will have to give you the information -- i will be happy to give you that information right away. >> thank you. i have noted the charts the secretary brought today. i simply must make a couple of comments about them. thatnot know who it was said there were lies in the

statistics. having dealt with that all my life always free curious on this high-quality preschool issue -- all my life, i was curious on this high-quality preschool issue. people ins 5,000,574 2011 and they spent -- iceland is number two. their population is 319,000. they spent $9,745 per student. is the russiane federation. i am not sure we want to compare the united states of america to these other places, especially the russian federation hough, the elected

point of the unisys spent more per student than any of these places -- i would like to point out that united states spent more per student than any of these places. if you want to look at it as a percentage of gdp, we are not comparing apples and apples. we are comparing apples and tangerines. if you look at iceland and denmark in the comparison to us with 320 million people -- >> children in europe's congressional districts are not competing for jobs in your district or state. they are competing with jobs -- with children in singapore, india, china, russia -- we want our children to be able to compete for those high skilled jobs and keep those companies in our country or are we going to see those companies might creek where the most skilled workers are? -- migrate toward

most skilled workers are? >> it is always a pleasure to have you testified before this committee. thank you for your outstanding leadership and perseverance for joining us on this education work force committee. i am pleased that president obama's proposed 2014 budget makes strategic investment in early learning and also on k-12 and higher education. i have been a strong champion for education and k-20. i have a daughter, the second out of four girls, who specialized in learning a preschool education for pre- cantor programs.

kinder programs. she often times reads what we are doing in congress and makes the comment that not enough children are being given that opportunity an. certainly what is in the chart in the material you give us, the u.s. ranks 20th in public funding for early learning out of 36 countries. surely that is in line with what she is telling me going on in texas. testimony to highlight -- you highlight that the graduation rate for latino students has improved from 200822011.

2008 to 2011. or three african american students are graduating on time and that is progress. i am glad we are seeing this progress with the achievement? -- with the achievement gaps. 2.2 5 million dropped considerably in 2011. the number in those school districts church dropped from 1746 to 1400 in 2011. .howing great progress , looking atk you the proposed budget -- the

republican party's proposed budget would result in two significant cuts to the education program i am talking about. what impact is sequestration this?g on peac can you discuss the effects of ryan's budget on president obama's completion goals? >> i want to go back to why we are pleased to have 700,000 fewer children enrolled in drop out factories. we still have 1.5 million children in drop-out factories. we have to get their better faster. -- we have to get better faster. we have a lot of hard work ahead of we need to invest, not invest in the status qu,. anytime you have a budget that would take away from poor hundred 20wo

million, children of aid american reservations. $4 billion cut in program. we try to get more people coming to college. it is devastating. let me be clear. our competitors are international competitors. they're not managing education strategy by sequestered. that is not how they're doing this week. they're investing, innovating, they are putting more money into the south korea has invested -- increased investment by a third over the past decade. i am worried we are poorly serving our nation's children and our nation's economy if we fail to invest and fail to give our children an opportunity to compete in global marketplace. the world is fundamentally changed.

>> i like to hear your views on the hr19.11 that would make college more expensive. how does this affect students of color? >> i desperately hope that we can agree that our goal is to lead the world and the college graduation rates again tweet that is the right thing for the people, for the country, and for our economy. i talked about the return on investment of college students being 52.7% per year. anything that makes college less accessible and less affordable and more distant for first generation college powers we do ourselves a disservice. >> thank you, i yield back. >> the gentleman yields back. >> thank you, mr. secretary. before i start up i have a special guest today.

she is my shadow, christine can you stand up and be recognized? thank you for being here. i also want to send [indiscernible] it is indescribable what is happening on television and compare to what is happening on the ground. i feel your enthusiasm for education. i got talking to adults and went to seven schools, talking to young people. most of myh what colleagues on both sides of the aisle have said. ago the chairman went in there and we went into the department of education. 700,000 of them do not have electricity. when you compare that i do not

think most people can comprehend the have a spoon without electric power. those with fair a year ago. i want to go to the early childhood. if you spend more money there you will ultimately get a better outcome. what studies are you setting? because i have looked at this very delicately. >> we can get you a whole series of studies. is the perry preschool project. it has done a lot of studies over the past decade. clucks let us go over this. those two studies that are closing rest on two academic studies. the 44 and 5 package studies. these studies actually started

in 1972. the perry got it started in the 1600's. was the costd between $16.41000 dollars for children. variousy was spent on intention interventions, home visits, parent counseling. it was incredibly complicated. that is what we what are basing this on. by no means the only one. we will keep you off -- we will give you all this data. recent short-term studies in tulsa and oklahoma, which has done a great job in preschool, have let 67 months in literary math skills. very recent study coming out of boston, seven months gains in

literacy and math and the sitcom to school. let us look at the head start program. >> i want to make sure you are aware of those. >> i am. in december of last year of the hhs released a comprehensive headstart data. states fort several several -- had said starts. -- said as it had a head start. several states had a head start. it to the children who had access instead of those who attended, 20% of children in that study did not attend.

>> it would not have mattered. >> again to you have children to work in that study who were part of the cohort, 20% did not attend. half would sit down with you and go to the facts. >> it is same as the group whether they dropped out or not. i am very committed to this. the number of drop out factors, i think that is a travesty in this country. we should concentrate on the 1400 students. i want to work with you where we invest the money more wisely. i think we can look at a higher number if we knew what the outcome was. give it to students who are effectively using it. get a grant, to drop out, i want to see that money invested.

>> the gentleman's time has expired. >> welcome, secretary duncan. the department11 stated the opportunity for the requirement of providing supplement educational service to students. proposed inrances this way in my home state -- i am concerned with the post- waiver realities of -- i know you have a lot of data but could you tell me what the criteria of the department -- that the department is using to ensure critical services being delivered to the students? >> at the end of the day, while

we have approved 37 state plans i want to look at outcomes for children. are those gaps being closed? our children who have been disadvantaged improving or not? tells you what is happening to real stood. let me tell you why we did it. one of the things i presented about washington when i lead the chicago public schools was despite the limited funding coming from washington they are tying my hands as to how i can spend that money. i want to be accountable for results. current had this to my department of education and the chicago for the right to tutor about 25,000 children after school. my department was telling me i could not do it. that is backwards. with limited dollars education being underfunded we thought it was very important not to dictate to districts and

superintendents and school boards that have to use 20% of your title 1 money of around ses. the good providers, use them. to say you have to spend money in this way, the prices are fixed, it's a plea to not make sense. the fundamentals thinking about means, if be loose on people flexibility about how they hit that higher bar. >> i do not mind the flexibility. what i mind is making sure that the students are getting the programs that they want and how we know that the states are doing that? >> we will monitor their plans. it is very clear begun monitoring plans that have ongoing checks -- i want to look at a student achievement improving. >> have you seen any information coming in since 2: 11? >> graduation rates are up, drop

out factories are down. we need to be in looking at state-by-state. i want to look at 50 states and see who is moving the needle faster. >> i agree with that. i am looking at the drop out, which is one of the biggest factors for many of us. once we get those kids that drop out -- rarely do they ever come back into the system. those are the kids that unfortunately sometimes end up in prison. those are the factors that i have, that we have the opportunity to reach these kids. we have an opportunity to change their lives around. i just want to make sure that the state and the local district are using it. more added a point. i think all of us have to be naive in dropping that rate down to zero. a lot of students do not -- a

lot of students leave high school not because it is hard but because it is easy. i have been in a couple of high schools that did an amazing job fixing that bridge between what they are doing in class and what is going on in the real community. the kids feel like they are wasting their time so we want to invest in states and districts that are serious about how things didn't understand what they are learning in class and how it is relevant to the job community. >> it is absolutely fabulous working with students. anyone that meet the students, certainly college material but that is not what it shows. a lot of them to go on to college. i think that is important. not every student wants to go a college. >> what other countries do, some countries attract students.

i never wanted to do that. we need to give them options, not limit the opportunities. >> i yield back. >> thank you. mr. wall work? >> thank you, mr. chairman. opportunity tohe meet with more than one dozen college and university presidents from my district and the surrounding district. we primarily discussed the issue of high costs of tuition, high cost of higher education, and ultimately the cost of students we discussed numerous times, this -- the cost of loan debt. we know the department of education requires these colleges and universities to collect a great deal of information and to report that .nformation to the department

that level of reporting to them continues to grow. ask, mr. secretary, since it ultimately comes back to the students -- for all that goes on in education including excessive reporting, if that be the case, has anyone in your department look at the financial impact of all of this record keeping and what it is costing not only the university and colleges of the students? >> we look at that very closely. i do this all the time -- we have regulations that are redundant or prince some -- or bird and some -- or burden some please let me know. is on needed burden please help me be accountable for challenging that.

and dollars are scarce, we do not want to waste time or resources. we want them to be focused on completion rates. in >> i appreciate that offer. are there any illustrations of what you're doing right now on that? >> i often and at this question, i do not get that concrete specific. the more specific you can be the more this piece of data -- the more concrete you could be could be helpful. a bigger issue is the idea of college costs. we can reduce paperwork. factse done a lot with and some vacation to make it easier for folks to apply for financial aid. part of the proposal is the rates for higher education to incentivize state to continue to to sweepniversities

down their own costs, and to incentivize universities to build culture's not just around axa's but about completion. the goal cannot be to go to college, the goal is to help them graduate. we want to be a partner in that part of what we are proposing. >> let me go on to the panel. i recently heard from several financial aid officers in my district that they are concerned about fraud. this is not new information to you, i am certain. 800 people are enrolling in community college to get access to student aid dollars with no intention of ever trying to complete an academic program or their ruling. can you point to specific actions that this administration

has done to clamp down on fraud within the programs? >> it is a real concern so i have a list of 10 tweets on october 2011 we issued a dear colleague letter to a school will community addressing the findings. we established and anti-fraud ring tax force, to address the issues raised in that report. we have created a mailbox and a colorado line. we're developing a process for schools to review and flag unusual activities. we take this very seriously. there are additional ideas should be taking. >> is there any move to tie fax irs taxtie fafsa with records so we do not have redundancies are mistakes, either an intentional or intentional. >> the irs can repopulate those

things. hope we can get to ways we can get to reducing the subject committee of reporting. -- the subjectivity of reporting. >> we will share with you what we are doing and if you have suggestions in ways we can do it better we will be happy to hear that. >> thank you. >> thank you, mr. chairman. thank you, mr. secretary for being here. k initiativepre- questions. i am happy to see that in the budget, i do not know how many times we have to go over it -- the study of studies. the sooner you get these babies ready the sooner -- the better their outcomes. i appreciate your an initiative on that.

just for my clarification, it would certainly provide the committee information on -- the regulatory question around dean full employment. looking at the outcome -- around gain full of employment. look at the outcome. it was inclusive but there was a with the for-ealt profits colleges. what is the percentage of federal funds that go into for- profits for student enrollment morses the outcome? certainly that information would be important for the committee. of money over time has gone up significantly to before profits. i am not anti-for profit.

we give them skills to give them real jobs and a living wage. we want to see them grow and prosper. people are putting others in a worse financial situation and using taxpayer money to do that. dollars a waste of tax answer to that information would be important committee. what happens with head start once the pre-k initiative is fully implemented, given the cuts that are coming and can good competition that was necessary and proper in some of the instances those agencies were working well. .e had a great partnership >> she is a good friend, we traveled all the time to get it. this is a zero to five

initiative. this is a goal to try to end achievement caps and stop paying catchup -- stop playing catch-up. on zero to three space, more home visiting. focus on head start and early headstart and an overtime the transition of for year-old would be into the pre-k program. it is zero to five. fromverage time coming this kind of background starts kindergarten at five years old 12 to 14 months behind. that is far too long and the goal is to level the playing field, have young children have the same starting line as fighter old and can the carters. if i could add one more thing, part of the benefits are academic but a big part of these

benefits of these long-term studies are what is called non- cognitive skills. the ability to have resilience and grit and those non cognitive skills place huge dividends. you could not be as successful as you are if you did not have those. not every child grows up in a family or household that has this kind of opportunities. they seem to have these lifetime in packs of people's ability to enter the middle class and be successful. the english component -- i read it quickly, is that included in the initiative? are we going to be able to make sure that all of our kids and families -- >> the focus will be on kids who are low income and work our way up. if our states wants to do more

in the middle-class they have the right to do that. the state's -- we are going to provide lots of flexibility to parlous state, build upon their straight -- upon their strength, and filling the gaps. >> one of the hits with the sequestration was in india country. as you see that question in a reflection of the president's .udget >> the gentleman's time has expired. >> thank you, mr. chairman. good to see you again. just a quick observation on the average increase of graduation rates and going back to what was said earlier about statistics.

i think it's great that the average rate is 78% tweet i think we have to be careful using the average because that always implies a high and low. we know the top five larger school districts -- the average comes out to 69%. maybe we start using the median interest to make sure we are tracking all school districts. an issue very important to me is the technical education act. should bel seniors college and career ready when they are graduated. we talked about the affordability of college but not everyone is meant to go. those that choose to forgo college in order to enter the workforce directly after high school the options and the necessary training. i do have some concerns with the designation to create a new innovation fund. as you are aware our funding is

based on demographics. because it is discretionary funding there can be fluctuations from year to year. the whole harmless provision was put into place in 1998 to prevent states from receiving a less than they were allocated. -- states established like my home state in nevada have had a significant population growth. if we used the harmless provision in combination with the version of $100 million for the innovation fund it put the bat at a significant disadvantage that could potentially result in a funding reduction of 42%. with that in mind did the department of education take these potentially devastating cuts to states like nevada that would receive a 42% cut in the account? does the department have a proposal to revise the formula to provide a more equitable

distribution of funds? >> i will be happy to work with those of the issues with you and the governor. we put out a blueprint. we have to get comments and feedback from everybody. our goal is not to devastate any state clearly. i would be happy to look at it. the fundamental point we are trying to make it as a country we did better with folk-ed. we have got away from this. we want to see this become much more part of the norm of what high schools offer. we want to spur innovation and creativity. other places are doing it. some high schools are training people for jobs that disappeared decades ago. we want to find ways to increase the access to quality xdte -- to quality cte programs. >> i appreciate your efforts to work together.

also, with the significant cuts based on a harmless act of 1998. i appreciate your help with that. i yield back, mr. chairman. >> mr. fisher? >> thank you very much, mr. chairman. thank you for your leadership. i am very worried about the federal campus space student financial aid programs. i sink -- i think sequestration has had a significant impact on college work study. in appropriations will to even further damage to those programs. i am particularly worried about perkins'. as you know, current law has the perkins law and fund returning to the treasury october 1, 2015. that means we have two more academic years left of a program we have had since 1958.

the department has made a proposal for the president -- or the president has made a proposal to dramatically expand perkins, basically turning it into a campus-based direct lending, helping significant numbers of additional students -- but let us be honest, i do not think that program has a chance in this congress. i think the acting commissioner of the irs has a better shot of being named a government man of the year than we have of getting gh.t program throu does the department have a plan b? that is a billion dollars of financial reform that could disappear overnight unless we are able to keep the program as it currently exists or extend it in some form or fashion. >> obviously your long history in this area -- stepping back to the big picture, we have a huge

challenge of keeping college affordable and not just disadvantaged communities in the middle class. whether i go to the grocery store or the dry cleaners, everywhere i go people are telling me the cost of college is crushing them. the question is is it the country? do we want to have the best educated work force or to we want to continue to the 12th or 14th? looking at all of these things, figuring out how we make college more affordable, have to be our collective goal. our proposal is increased to the top for higher education. a dramatic impact on k-12. we cannot do it by ourselves, there have to be shared responsibility. but if we can get states to reinvest -- for the state recently cut funding for higher education. there is no upside there. not enough universities are using technology to reduce costs and increase graduation rates. we want to try to put some

significant care out there to incentivize this behavior. we would love to get your insight on what makes sense. the debt burden is staggering. the cost is far too high. none of this is good for the young people of the country. >> thank you for that. i would be delighted to work with you and your colleagues in the department. i guess i wanted to empathize -- i wanted to emphasize the importance of the campus-based financial programs. they are often the difference between whether a student enters force doesn't enter. second question, you talked about a culture of completion. i am in full agreement and there are a lot of pieces to that. one piece that i hope we could resurrect is cooperative education. as you and i have talked about this, it is something i think one of the best things colleges

can do for students. it also correlates very positively with completion. students not only stay in roles, the finnish and generally 70% of them have a job waiting for them. if we want students to enter a job market that isn't as hospitable as we would like to be -- cooperative education can be a part of that solution. i would hope we could move towards resurrecting the federal role in cooperative education. >> i will think about that. it is an issue of national security and economic competitiveness. we need to be bold and work together. >> thank you, mr. secretary. i yelled back, mr. chairman. >> the gentleman yield back. >> double, mr. chairman. secretary duncan, the proposed budget contains several new and costly programs to address college of portability, including billions for the race to the top.

what is the department doing to remove the existing regulatory barriers that prevent colleges from sharing innovative practices by reducing costs and spending billions more on the programs. i am aware your apartment implemented regulations. you implemented seat cars that were put into place over multiple administrations. in response to the democratic side of the aisle toward department maintained -- preventing revenue-sharing between colleges and third parties to innovate and share expertise. --r department prohibited from participating in this market. you bya letter sent to ranking member miller, saying that you were looking to fix this unfair ruling negotiating

process. it is not on the agenda of issues to be addressed and the federal register notice the state process will take years. there is bipartisan support to fix this problem immediately, expand innovation, help colleges reduce cost to students. simple, straightforward legislative language has been put forward. would you support this legislation and work constructively? >> i would be happy to look at that. if there is bipartisan support for anything these days we have to look at it seriously. >> i appreciate your commitment to do so. one question dealing with common core standards. i have been a state's rights kind of guy and i believe the top quality of education really is affected at the state level and more specifically by the local school districts. i do not see anything in the constitution that deals with education -- the 10th amendment

gives the states the lion's share of the responsibility if not all of the share of the responsibility for education. the general educational provisions act prohibits the federal government from directing education. paul i have a lot of constituents on the education front that are very concerned about the federal takeover of curriculum. they see it as a beet which. it is a promise of money that if the state one with this federal curriculum many states have taken the bait but a lot of students and parents are not happy with this. what are we doing to make sure that we maintain local control of curriculum? >> fax matter. as a matter of fact we are prohibited by law from touching curriculum. never have, never will, no

intent. there is not a black helicopters deployed. i am not trying to get inside people's minds and brains. let me be clear -- what many states on a voluntary basis have done, including your state, is raise standards so we have children competing with high standards and international benchmarks so they are not at a disadvantage to children in india, china, and singapore. how you teach those high standards? the curriculum is absolutely control and local levels. you have never heard the ones talk about that. -- you have never heard me once talk about that. let us talk about that. theirzona wants to raise standards tomorrow or lower their standards you have the absolute right to do that. >> thank you. have auld just

straightforward question and you have answered it -- i appreciate it. he said federal government has no intention of getting involved in what states do for curriculum. i appreciate that and i yield back. >> to be clear we are prohibited by law to do that. >> the gentleman yield back. >> thank you, mr. chairman. i have a guest from dayton ohio who is one of our foster care advocates. thank you for being here. thank you, mr. secretary for your testimony and thank you for your focus on children, which sometimes i think gets lost in this very committee. i wanted to make a comment about the smart solutions they talked to you about earlier. let me just say it is not smart for a solution. all it does is it is just another vote that is going to try to balance the budget or make cuts on those that can least afford both those that are concerned about idea, i do not

have colleagues have voted for the stimulus, even though there was significant resources for idea. >> thank you very much. i see in your budget you're asking for an additional or $150 million for stem innovation. what emphasis will the department place ensuring that these funds will be used for low income education. >> we haven't talked enough about stem so i appreciate outraising it. this is an area where the jobs of today and the future are going to be in the stem field. so equipping our kids with those

skills is important. this is not just an department of education initiative, the president has challenged us to do more. he is passion nirt about this. there's -- passionate about this. he's asked us to lead an effort to he bring together all the resources behind stem to make sure we're doing a couple of different things. one, we're creating a master /teacher course so we can help keep the teachers in the field. we need about 100,000 stem teachers going toward. we want to invest in communities. there are strong private/public partnerships around stem. where all are working together so the stem innovation hubs can increase the pipelines. so there's a chance, i think, to do some creative things as we

already do, we'll ensure that disadvantaged communities have access to these kinds of opportunities. >> i will be introduces the promoting health skills act. this bill recognizes physical and health education as core subjects ensuring that schools have the options to use title one and title two funds for physical and health education programs. we know about the epidemic of obesity in this country. as we move toward the authorize, what are your thoughts as recognizing physical and health as core subjects? >> we're both trying to be athletes and that chance to run around, burn off a little steam, for me to do well academically, i needed those opportunities. i think that is true for many young children today. my wife is a former physical

education teacher. we need more recess. these have to be a normal part of the day. again, we have all these fights in education and some people believe that if you do more of that you're hurting yourself academically. it is the opposite. there's all kinds of research, they can concentrate and not be jumping up and down. whatever we can do to bring p.e. back into the norm, whatever we can do to encourage recess. the nutrition part is important t the healthy skills and lifestyles can stay with them over the lifetime. the chance to play and be part of a team, that should be a normal healthy part of growing up. i think there's a down side to not having that there. >> thank you very much. i yield back. secretary.u, mr.

i want thank you for your work. we agree on many topics, disagree on some. i know of no one who questions ur commitment to the young people in this country. hopefully, we can touch on all three topics. i want to make your aware of the improving post-secondary student act that passed last week. it is designed to make sure that families as they go through this important investment of higher education have good data. i hope we can streamline that data and improve reporting and burdens of colleges. >> i don't know all the details but i love the direction you're trying to go. i love the transparency. for families to choose the right colleges for them, have the full

information, what is a grant? what is a loan? whatever we can do to add transparency, to add clarity, not to go on too long but we have the best system of higher education but we're the marketplace for choosing the right school is insufficient. whatever we can do, again, anything bipartisan, i love to work on. great, we're glad to work you. >> it doesn't to be sexy. if it helps the young people. don't discount what you're doing. >> information matters. several questions address pell grant. i'm a product of pell grant. it is a very important program. i'm glad we have more students who have access to that. we spent $36 billion on that last year. it is my understanding we don't really report or measure as a

society what the outcomes of what pell grants are. what are your thoughts about reporting on the outcomes? >> we want to look at what do universities do to have completion and looking at apples versus apples. seeing which university is taking this mission seriously and we want to provide maximum transparency there. we've gone from six million recipients to 5.9 million. it would lead to a reduction in access to pell grants by $4 billion. how is that in our nation's best interest? >> again, the point i would make, when you start to measure what the outcomes are it give you the opportunity to shape policy. the third issue and understandably it is tight budget times.

we've heard comment abc tiret budgets. -- comments about tight budgets. we want to raise a concern with you that was raised to me. shelby's school system's annual budget is $40 million and $3.6 million is provided by federal funt funding. they have raised the fact of obamacare on our local budget. the provisions of obamacare require health insurance for anyone who works over 30 hours a week. they will be required to cover them with obamacare or cut back the hours for these teachers aides and have impacts on student learning. it is estimated about $800,000 on this school. if you look at the federal impact of $3.6 million in

funding it is a 20% reduction in the federal benefit. are you aware of this issue? secondly, would you support the idea of exempting k-12 for the requirements of obamacare? >> i don't know the details but if you give me their number we have team working on the implementation of the obamacare. if you can leave me the contact information we can follow-up on that. >> thank you. i appreciate your help. >> the gentleman yields back. >> mr. secretary, thank you for your testimony and your years of service and observe dedication to the students. when i review the blueprints in the budget summary, i see a lot f comments about assessment. it reminds me when i toured a

school and they cut p.e. i see comprehensive funding and in your testimony you say budget detailed value choices. what i'm looking for is a value choice that furtherers development of innovative, creative critical thirchers. you talk about global competitiveness and i don't think businesses or employers are looking for good test takers. they are looking for people who are creative and innovative. that comes from using both sides of the brain, from a well-rounded education, especially includes the arts, music, p.e. we need to stimulate intellectual cure rossty. you talked about the kids who drop out because they are bored.

in light of the fact that a lot of students today will be doing jobs that don't exist now and making things that haven't been invented yet. what policies will lead to schools that, really cultivate creative entrepreneurial students and how can $75 million be adequate for something that is so critical? >> it is a huge, important topic. that is obviously, a funding source. i would argue to you when you see states rank critical thinking skills, that is part of what you're getting at. please challenge me and challenge our team. i can't overstate how all those things you talked about need to be the norm for public schools not the exception. not just for high school but first, second, third, and fourth

graders who can get these skills and self-esteem and develop a passion for something beyond the academic subjects. please challenge us to do more. the other thing that is of important in the waiver process, what i hated about no child left behind it grades the child on just a test score but i want to look at housm they are improving. if you seen in many states through the waiver process is real creativety here. looking at graduation rates. looking at reduction in dropout rates, looking at college going rates, looking at what percentage of kids are staying in school, just in our fundamental accountability system we try to move away from a focus on a test score. if you're going to reduce

dropout rates i think you have to attack all the things you're talking about in different ways. we're trying to change the structure, sharing what different states are doing. but those kinds of opportunities and learning experiences need to be the norm not the exception. if you have thoughts on how we can do that better i would love to hear them. a billgoing to introduce that has a lot of great brain research how the arts and design improves and enhance the stem discipline. in my remaining time i just want to make a comment about the importance of early education. i had an opportunity to hear a doctor in oregon who spoke about rising out of poverty. she's the only person in her family who had not been incourse rated. incarcerated.

what she's doing now compared to where she came from is remarkable. this goes to support the importance of that early learning it is a great investment in childhood education. we want to get to the issues of equality, we give every child an equal opportunity for the learning. thank you for that. >> very quickly, just on the arts piece, quickly, in the arts is the turn around space, these underperforming space use these arts curriculum to turn it around. here in d.c., there is an elementary school, i encourage you to go visit, it was amazing. 3 or 4-year-olds working on an opera. that was no what i was doing. the principal was here yesterday. he's amazing. that is another funding stream learning.see creative

>> the world is a better place because i never worked on opera. >> i thank the chairman for not working on opera. i would say that i just saw the ballet in chicago a few weeks ago. these kids in chicago who are learning that as well it was absolutely fascinating. it was the one of the most athletic experiences i've witnessed. talk to me about the waiver process. how much time do you spend or did you spend personally involved in that process reviewing it, deciding who gets a waiver and who doesn't? >> not a lot of personal time state by state. some. when it was pretty clear yes or

no i did not spend a lot of time. what are we trying to accomplish, what we're trying to move away from in the no child left behind. >> the reason for my question and we've had personal phone calls. i will say on the record i greatly appreciate it. regarding this administration, you're one of the ones i think i can really communicate with and reason with and have a relationship with. i appreciate that. i thank you for it. but i'm seeing letters that are coming out, if you're the head of the organization you're creating the culture. the finding that out all around especially the federal government. the letters don't track our personal phone conversations in this respect. back in 2012, we asked to see your schedule for the purpose of determining -- because we have oversight over no child left behind and waivers circumvent

the no child left behind. we have a duty to see what the department is spending its time on and what you're spending your time on. we got an objection to that looking at your schedule. then i see a letter where you -- you sent a letter to the states that received waivers asking about the implementation process. that is the letter we sent. you felt the need to send a letter saying that the department has been transparent and check with their legal council in responding in responding the letters. you can't read in the context but you can take that almost as to to say check with your council. i don't have to respond to these people until you check with your council. can you clear that up? >> i was not aware there was a

request on my schedule. >> june 25, 2012. i will introduce it into the record without objection. >> my point is, looking at my schedule would not -- it's a difficult way to figure out how much time, the meeting, i don't know the title of the meeting. if you have a direct question i would be happy to answer. >> would you send your schedule and add to it i'm spending this kind of time, round figures. a wild guess. could you try to reanswer the question? >> i don't know the details. > how much time do you need? anything you can answer, you can look at your schedule and give us a ballpark figure, how much time you're spending on these labors? >> again, to be clear, i spent a

lot of time thinking on the philosophy behind it but less time on the waivers. >> you can't give us a date? a month? >> i can't -- it is months. it is an odd request. i don't quite understand. >> it shouldn't be that odd of an request to understand when we're circumventing federal law how much time you're spending on these decisions? don't think that is a crazy question. >> i'm a little taken aback. i've never had that question in any setting. . it was asked in june 12 >> zero intent to do whatever. states were a little worried when they received that letter. we have good relationships and we were trying to mitigate, . ock down the worry

we have a good trusting relationship. it was scary to some states. >> i appreciate that. on common core. the standard is for for you to adopt college and career ready to a significant number of states. is this any other standard beside the -- >> the gentleman's time is ready. we'll take it for the record or i will give you a chance later mr. secretary. >> that's incorrect. i need to be clear. > noted. >> thank you, mr. chair. in a time when congress is disinvesting in children, i want to thank you mr. secretary and thank the president for putting

forward a budget proposal that will hold our sacred obligation to educate our young people. in particular, i applaud your focus on funding early education at a time when sequester cuts like imating promises head start and stem education. robust funding for education is essential for ensuring that children can live out their fullest potential and this nation's economy can reach its long-term potential. the earlier we begin teaching our children in the field of science, technology, and education -- in engineering and math. i know it works. i served as an educational coordinator for three years for head start. i have an advocate from florida here.

raise your hand. research of the last decade shows how important rates of teacher qualification are in ensuring that pre-k are high quality and produces all the benefits we want to see. the findings from national research demonstrate that low levels of compensation diminish the ability to retain the highly trained work force for high quality early education. how can the administration ensure that the work force is adequately compensated? and the position to provide high quality of education that produces the desired benefits for children, especially in science and math. they are energized by technology, they can use the ipad. what do you see as the

administration can hold that interest? >> 2 and 3-year-olds are sometimes ahead of us, quite frankly. we have to start early. that's a great point this is $75 billion proposal. this ellipsesing the else we've done. this is a really big deal. we think it is a game changer. part of those resources can compensate teachers, part of it can make sure they have the training to work in these areas. we have to raise the quality of the training of folks who participant in this these programs. here is a huge emphasis there. if this is immediate occur programs that does not change kids' lives. they have to continue to learn and had just as the world changes, is hugely important to make sure we hit that quality

benchmark. >> according to the committee for education funding, the republican budget, the ryan budget would cut head start by an additional $900 million on top of the $104 million cuts from the sequester. what impact do you think this would have on the efforts to ensure that all children have the skills they need to succeed? >> the facts are today, less han three in 10 have access to high quality pre-k. if we cut $146789 billion, that would be tens of thousands fewer children would have a chance to go. we're -- $1.4 billion would be tens of thousands fewer children would have a chance to go. children need longer days,

longer weeks, not less time. why do we do these things this are not in our nation's interest? it is mind-boggling to me. it is so disappointing. >> what do you think the administration can do fill that gap to make sure we -- do we plan to do marketing? any outreach to people? >> i'm traveling the country talking to everyone and again, outside of washington there's a huge amount of interest, republican and democratic governors are investing, michigan, nevada, alabama, i can go down the list of republican governors putting huge resources behind this. i think we can build an interesting coalition of bipartisan governors, c.e.o.'s of parents in head start communities, of the faith-based community, of military generals who like this, police chiefs, i

think we can build an interesting coalition. i was in michigan recently with the republican governor who was supportive. this is the birthplaces of this work. for all the dysfunction in washington in the real world, there is a real chance to try to move this thing. i'm going to try to travel the world to try to build that coalition. >> time has expired. >> i was on the committee and my first two years here and part of the stuff i enjoyed how we work together and try to work together and your honesty in these meetings. the one thing i was ranking member at the time. one thing that was bipartisan was the agreement that we don't want kids graduating from school with too much debt.

i think it was frustrating how the process moved forward. the most frustrated people were not of my party and they were members of your department. i want to talk about the report. last week, as you know, there was a report in "the wall street journal" a member of the department is being investigated for leaking information. i think your own i.g. was asked to come in and negotiates for the rule making process. can you go how this particular individual affects how you're going forward with this? >> it does not affect us whatsoever. we have a great relationship with the i.g. obviously, suspend judgment or opinion until that report comes back. >> you don't have any recommendations yet? >> no, that is an ongoing investigation.

>> so moving forward. >> yeah. >> so thank you. i yield back. >> the gentleman yields back. >> thank you, mr. secretary. i have to make a comment on the issue. you and i know and most people know this was a judicial mandate back in the 1970's that communities educate all children on that. the federal government stepped anywhere states would voluntary accept or not on that basis. we authorize a certain amount of money for child's additional money but we never appropriate that full amount. the republicans on that and i and this committee put forward to fully fund on it and not one of our single republican friends voted on it. >> i think there were 320 members of congress to fully

authorize that. >> i'm glad to hear others saying that we're behind this. i contrast that with the republican budget, as you mentioned, cuts over $2 billion. we also hear people talking about not wanting to give the burden on our children for a deficit. apparently, they don't have the same concern about loading up student debt on them. given the fact that the to essional budget office can i e over $30 billion assume you don't favor that republican proposal, that you favor the administration's plan? >> what i'm interested in is a long-term fix. i want to take on tough issues,

take them on for the long haul. there is so much and i don't want to come back year after year on the same stuff. >> i would hope hope we keep the 3.4% rate for the stafford loans. then look at that long range proposal. does that sound all right? i would love to figure out a long-term fix sooner than later. >> tell me about the administration's families on the repayment plan and the importance on this process? >> i think it is an extraordinaryly important opportunity. it is a terrible name. we have to market it better. the chance to have people's -- their repayments index to their income. so fur you making more money you pay more, if you're making less you pay less. after being a teacher, all that

debt is forgiven. it is a remarkable opportunity. we do a better job in terms of getting the word out, there's more young people who could take advantage who haven't yet. but i'm thrilled to get that done. >> let me ask you a question, there is any number of students who graduated who are carrying a burden of debt with high interest rates. what is the administration's rates on getting relief for that population? >> i'm happy to have these ations on any of areas. let's work in a bipartisan way to factor that debt supass $1 trillion, there is no upside there. the more we think about these things comprehensively in a bipartisan way i welcome that conversation. >> that would put $17 billion

back in the economy and help these families out on that. i hope we look in that direction. >> you worry about people trying to buy a home. >> buy a car. try to start a life that we always joke, it is not that funny but try to get them out of their parents' house. >> that is real. >> we have a bill in the house that addresses that in a long-term fix and we look forward to working with you on that. >> the gentleman yields back. >> i'm going to continue to be concerned about the run away cost of the pell grant program. we received the figures from the c.b.o. demonstrating that we're looking at $500 billion funding gap. we must stop infusing the one-time mandatory funds into this program. you talked about the fact we have nine million participants in the program, that is up from five million from six year guys.

now the cost is $42 billion. we're not doubled the number of participants but we tripled the cost. what reforms do you have or what ideas do you have to lower this cost? before going to here i asked you a question about the community college students who are dropping out after they received pell grant money. what can we do to bring the cost down? >> i don't think the goal should be to bring the cost down. i think this is the best investment we can make. you're sitting next to a colleague who the pell grants made him go to go to college. i want to make higher education more affordable. we need to make sure that the prom is not being abused and people are taking the money and not do other things. but i would like to see -- to be clear, i would like to see more

young people have more access to pell grants, not less. >> infusing more money is not necessarily exclusive. i agree we need to be more efoshte. that's my point. how do we become more efficient? the answer is just to throw more money at it, we doubled the amount of students but we tripled the cost. if we continue to do that our kids won't have it. >> i talked about the race to the top. we have to find ways to get states to invest. several states have cut their investments, that is not good for their economy. access arounduild completion. it might bring down the cost of

young people. >> i agree there is no incentive for universities to be more efficient because we just throw more money at them. >> that's not true. 40 states have cut funding to education. universities are out there hurting. for me it is not about pointing fingers. what is the role of states? what is the role of universities? we need to not blame each other but behave in a more productive way. >> i look forward to working with you. like my colleague, we appreciate you're willingness to reach out. i think your the only secretary that came to my office and met with me. i think we all appreciate that very much. i look forward with working with you. >> put that on my time sheet. >> it was a good hour. i will yield the balance of my time. >> the gentleman yields.

>> thank you, chairman, i appreciate that. how much time do we have left, mr. chairman? >> 1.24. >> perfect. i want to pick up the conversation where we left off. i apologize. let me set the question up again, in your proposaled budget request, as i understand it, you're saying that you're going to limit funding to states that have adopted "college and career ready standards that are common to a significant number of states." is there any set of standards other than common core that fit that quote. >> yes, absolutely. >> which ones? >> everything we've done, including the waiver package, our goal is not common, it is high standards. we're providing waivers to states like virginia and minnesota that are not -- >> so it is not a waiver question. it is funding to states.

>> let me be really clear. me.he grant program, excuse >> which to be clear? >> the repeat proposal was about limit the funds that have adopted college standards. >> that is not common that is high standards. the goal is not common, the goal is high. we would not want to provide -- >> from a practical stand point is there anything but common core. >> virginia and minnesota are two examples. >> thank you. my time has expired. >> thank you and welcome. i want to echo some of the comments. i don't know anyone in government who shows as much passion as you do. there's been discussions about how nonnecessarily educational

factors impact the education and the affordable care act has been raised today. is there any way to quantify and there probably isn't, how important the expansion of of aid, the joiblet ? panded -- eligibility >> if we're serious about students being academically successful they have to be in place. so students' physical needs to be met, health care needs, they need to be safe, their dental needs to be met, if they can't see the black board they need glasses. those are foundational. when we meet them, then let's talk about calculus and physics and going to college. when children have aching cavities or they can't see the

blackboard, they have health issues diabetes, asthma, it is difficult to concentrate in class. >> there is no question those failing to do that severely impedes academic achievement and ultimately, long term success. >> no question. i've worked in communities all my life where children didn't have those kinds of opportunities and the loss of human potential was staggering. that's why i do what i do. >> in a related issue, we talked about stem education and that seems to be a national goal to look to entice people into those areas. how much difficulty is it to entice people into stem and generate enthusiasm for them on the other end the country is cutting funding for research so the jobs those people might fill -- seem particularly

[unintelligible]? >> that presents a real challenge. in math and science, in disadvantage communities, i argue that we should pay plagget and science teachers more money. we find ways to compete with the private sector and help those kids who don't have those opportunities. we have not talk abouted a technology, i think that can help to be a real game changer. this is the way that the world is going. when children don't have access that are comfortable and confident in third and fourth grades, we limit, we put a cap on what they can accomplish. >> i was going to get to technology. i'm very supportive of the effort. i was in a middle school not too long ago in a very economically challenged in my district. i asked the principal if she

could estimate what percentage of her students have access to the internet at home and she said 10%. is there anything we can do on the federal level or any level to try to correct the situation? >> we have to. i appreciate your interest and leadership so much. technology can either be this great equal lieser or it can create -- equalizer or it can create a divide. the upside is so high and the down side is so low. how we create access and make areas it can be challenging. i think we should all challenge ourselves across the federal government, agencies, we work hard with the f.c.c. we need to find ways to make sure that children who should be able to learn anything, any time, anywhere, 24/7 have those

changes. >> just a quick question. what does the president's budget do in terms of literacy programs? >> i don't have the numbers but there is a significant investment there. our hope is that some of the states are raising standards with the focus on talk and express your ideas around complex issue, expruss you're verbally and in writing. we hope to improve the literacy rates in this country. >> thank you. i yield back. >> the gentleman yields back. >> first, i want to -- in response to what he was asking about. i want to acknowledge many of us here, certainly myself clued that every time you spent on the waiver process is time well spent. we appreciate that in the congress. you used the process in no child

left behind. thank you for whatever time was well spent. we appreciate it. i want to compliment you on your focus on early choodhood education. seldom do we see as good of an investment in our future. looking at the numbers you cited numbers that have demonstrated lower delinquency and other areas. investment and childhood education leading to people with higher income careers and paying greater taxes back to our 7:1try above and beyond the ratio. the question i have about charter schools. the president's proposal includes an increase to the

charter program. the budget also expands the grants for the replication of the schools and expansions. 2009 thank you for being a champion for expanding educational choice, both in charters and district schools across the country. as you know, the supply of invowvative charter schools have not caught up with -- innovative charter schools have not caught up with demand. they are forced to attend a school that the parents per seerve as interior and to bjective criteria is interior. of course, not all charter

schools perform well that is why my bill concludes stronger language around practices, closing family charters and more accountability for school performance. i want to ask you today, what about the charter school program do you believe is the most effective in spurring the growth f charter schools? statesld you incentivize for charter schools? >> i want to thank you for your thoughtfulness on this. i appreciate the ongoing partnership in everything you bring to the table as we discuss these things. i am met with a number of high performing charter schools. it was uplifting. they have been able to dramatically expand the number of kids they are serving. there is still a real need, a

waiting list that you talked about. but they said they would not have the expansion and the reach it had and in the short amount of time for -- if it wasn't for our support. there is nothing magic about charter schools. we talk about failing schools and 5,000 were charter schools. we pushed them to close down and do other things. how do we continue to replicate faster and high quality? it has to be charter and district. charter has been more nimble, for entrepreneurial than district in success. >> if you could also address how we can incentivize states to encourage charters? >> i would give us a low grade there.

there's private foundations that are it getting charters and this is the wrong fight. we have one common enemy and that is academic failure. whatever we can do to attack that together and replicate success we can need to do that. i would encourage districts to replicate their high-per fortunatelying schools. -- high-performing schools. >> when you look at accountability and turn around, would you look at others to do the same? >> no 7-year-old knows if they go to a charter, magnet, or a district. am i learning? is my teachers and principals helping me? we need schools that look like that. >> i yield back. >> for the record, the question was asked who said lies and

lies, it was mark twain and he wrote it when he lived in connecticut. if only i can get steven spielberg to correct the mistake he made in his movie but that's another hearing. [laughter] first of all, i want to thank you for your visits to connecticut in the wake of newtown. some day we're going to get you to earn connecticut but it means a lot to the people of my state. your testimony, union, on school safety, it was eloquent in terms of the fk that we talk about these issues, if kids don't feel safe the numbers with illness -- the numbers that came out a few days ago, this has to be a focus. i want to just spend a minute, i was out of the room for a second because i was talking to the

head start director in connecticut who last monday had a staff meeting announcing six layoffs for teachers and this is driven by sequester. these are families who are going to lose head-start services. they have 120 kids in the program and they are going to the classroom slots next if we don't turn the poison off. again, looking at the budget that came out, the majority, which is below sequester levels. all the talk this morning about early childhood and the benefit, the reality out there is we're going backwards and we've got to address this issue of sequester. i'm sure you're getting these calls and this input. it's going to pick up speed. i'm looking to you to help use your platform to warn people about the damage we're doing. >> almost every day there's two

or three or four articles where the cuts are happening now around the country. whatever i can do to raise the alarm of not just what is going to happen but what is happening now. i'm trying to go out and talk about it and shine a spotlight on it. again, i think people in washington don't begin to understand the consequences of their actions. how do people feel good about that? was it to take away opportunities away from poor children? is that what motivated for you to get into public service? i don't believe it was. >> they shouldn't bear the burden. >> military families, families overseas giving their lives for us and we're going to give them a worse education and take away their counselors. families who are giving everything from us and we're

going to deprive them? i don't get our values. i don't understand. >> so in case, this is something i really think resonated with the public when they see that kind of damage being done. i was at a chamber of commerce meeting last week and shared that outcome and a grown went up in the room. hopefully, we can -- it was not about having sequester to go into effect, it was about having eople sit down and compromise. he said that was the purpose of it. it was asked about extending the 3.4% rate. i would say for someone who is pushing that, we need a higher authorize bill. we need a long-term solution. we're not getting there in 40 days, which is really july 1 and the ticking clock.

i think the president's proposal using market base to a point. i think that has something that people can work with. frankly, we have to do to make sure that the kids who are making the decision on where to go to school have some confidence and horizon about the decisions they are making. >> sequester, if i can do better to articulate it better please push me. again, on this one i know it is 40 days, this has some intellectual complexity but it is not that hard. expectations have are so low for congress to get anything done, i wish we could take two issues and we compromise. not everyone get what is they want but that is how the process is set up. i would love to get it done and move on to the other issues.

there is so many other things we need to spend time on and i don't want to come back year after year on this. >> thank you, mr. secretary. >> before we say goodbye i want to yield to mr. miller for closing remarks. >> thank you, mr. secretary, for your time. i agree with my colleagues here that the time you spent on waivers is better spent then trying to get a burem resolution out of this congress, unfortunately. out of tisan resolution this congress, unfortunately. this was a creation of the federal government. in fact, a number of people are surprised when the governors came forward and thinking how are they a worldwide entity. they need a better school system with better standards and better

performance. it's an important -- you have allowed districts that want to go to the future to go. not being held back by congress' bickering back and forth. i'm concerned they take everyone with them. the hallmark of this law is to equity and the treatment and to be opportunity of these students if they succeed or not. we can't guarantee that but we can provide the opportunity of first-class education. along with the common core. i'm surprised with the response on how positive it is. california has been reluck tant on this. it has been dramatic across the state. o that's all is very

encouraging. it's very important. i hope we will be able to work t a long-term bipartisan support for student loan activity. we've got a serious problem on our hands. i think there are new constructs that can be put together, as you say a shared responsibility. if the states continue to walk away from public support for public institutions we can't be put money in it at the top and they are taking it out of the bottom and that is what they are doing here. i know people are concerned about the growth in the pell grants. but a lot of people who never thought they were would be eligible for a pell grant but when they lost their job and had to go back to school, they found that very helpful to get the training so they would be ready when the recover starts to happen. they are not there by choice, they are there by circumstance.

that turned out to be a great thing for the program. i want to thank you for these projects that you have under taken. again, you heard from my colleagues, there's a group of people who are saying college isn't worth it. oh, yes it is. by every measure it is worth it. now people are saying early childhood education isn't worth it. yes, it is by almost every measure. it is incredibly important. we know the difference between families and vocabulary acquisition. we know the barriers that child with the first formal education system, whether it is head start or kindergarten. there is a bage difference between acquisition, reading skills and the rest of it, in terms of colors and numbers. it sounds so basic but so many

children come to school without those components. i think we've gotten better at partnering up with parents in the involvement, in the education, certainly in my area of the state it seems to have gone better. we realize we have to transfer some of this. there are very exciting things being done. some school districts are engaging parents in that early childhood experience and helping the child transition. again, if we're not going to build a first-class receptacle for the students we're spending money on, the children we're spending money on in early childhood education, if we dump them into a sub-standard system, it's not going to work. we have to get this system up and running. so i really just want to encourage the administration to push on this. it is so important to the

success of these young children, in terms of their participation in the fullness of the american society and the fullness of the american economy, and to help us move on to a democracy in a diverse country. we need their participation. so thank you very much for spending this time with the committee. > i too want to thank you, mr. secretary for being here today. it has been an extraordinary bipartisan support for pell grants. we're concerned about how much money is going in them and is it being spent, not only wisely but is it being abused? we know there's evidence that it is being abused. a student goes in get aspell grant, buy askar and never goes to school. we want you to look that the prom to make sure we are, in fact, helping not only kids but

as the ranking member sometimes as people coming back they may be 58, i forgot who used the that number. that is still young to me, i nope people come back, they need access to the pell grants we want to make sure it is not being abused and sometimes we're getting reports to indicate that might be the case. on student loans, we've talked about this again and again, we head it talked about here. we had republicans and democrats trying to get to the solution that i think you and the president has asked for, which is a long-term solution where we move the interest rates to a place where the rates are determined by the market. i hope you continue to work us with because there is still work to be done as we move there this through. july 1 is coming. we're not done yet. i would like to be able to work with you and try to get that long-term solution. finally, the point was raised

about what is called incentive compensation for affiliated third party entities. probably nobody outside this room know what that is. we've talked about this a number of times. this is an issue that came about because of departmental action and it can be fixed by departmental action. we were looking at a legislative solution here and we thought we had it but we missed be a little bit. we're not going give up. i hope you will look at it again. thank you for coming here today. it is a pleasure to have you. complete answers to our questions. very excellent testimony. again, i know you're watching closely in what is happening in oklahoma and those schools and you share our concerns and prayers. so no further business the committee stands

>> recovery efforts continue in oklahoma after last week's tornado. seven crosses were placed in moore, -- placed in moore, oklahoma in the memory of the children that were killed there.

[no audio]

>> c-span also walked through what remains of the school and spoke with a sergeant from the police department.

>> this is the front of the school. this is the main office.

this is one of the main hallways. there are classrooms on each side. in then are on the end bathrooms. this is a classroom. this is the gymnasium back here.

there were kids actually in the gym and hallways back there both a u shape. this is the first gate classroom. we are standing and what was a first grade classroom. this is a hallway. .oing this way

this is the only classroom that is not totally disturbed. you can get an idea of what some of the kids were doing as the tornado came. there was work on the desk, what they wanted to be when they grow up. >> what grade is this tax >> this is first grade. >> what great is this? >> this is first grade. they were all down here. teachers from these two classrooms and those two classrooms all were along this wall here. they may did all the way here and had one of the teachers pin

them down. all of them down here, they went into the women's restroom. it was too full for the rest of them. the idea was to put as many as you can. there was this wall and another exterior wall. all these people survived out here. the walls collapse because the vehicle actually went through that wall and this wall. they still survived.

what is weird is this tornado came from the southwest but when it got in moore, it went north for three brought -- three blocks and then street east. east for about another mile and a half and then it started going northeast again. that is not real, and for it to do that. .sually they continue northeast this one made direct angles. this was over the school for about 2.5-three minutes. it is not just through like they normally do. it was a very slow-moving tornado. you saw where it was going. >> i stayed on the backside and followed it until it was too

much to breathe. my daughter's school is right there. then the telephone poll started going and i could not get by. i ran. then the neighborhood was so messed up people started yelling for help. we had a lot the storm shelters covered with debris. gaslight and spring in the shelters a lot of things you do s brayingy -- gaslight down into the shelters. a lot of things you do not really think of it. fine. was founding -- no one was killed in my daughter's school. that is pretty much what is left. >> president obama will head to

oklahoma to see response and the cover he efforts firsthand. he will visit with families impacted by the tornado. we will have that here on c- span. republican national committee chairman rights previous and priebusl -- reince and rand paul spoke. this is about 45 minutes.

>> if i could have your attention please, we are going to get the program started now. folks, i need to ask for your attention please. we are going to get started with the program now. don't make me start identifying the talkers by name. i hate to have to do it. ok, folks, we are going to get started. thank you very much. i hope you are all enjoying your meal. we want to say thank you and if you could join me in a round of applause for the dinner committee, the extraordinary job they did today. [applause] thank you all. we are going to get started. i want to start this introduction by sharing a quick story with you. last summer, i was on the wgir political roundtable. i know a lot of folks in this room listen to it every wednesday morning. the other guest on the other side of the political aisle was former democratic chairwoman kathy sullivan. i think some of you have met her or read some of her columns and updates. -- op-eds. we were talking about the

supreme court case for obamacare. we were waiting for the answer to come down. we were discussing back and forth. we're both pretty passionate about our positions on this issue. i repeatedly made my point about where i felt the constitution sell on this issue, and where i felt democrats were falling on the constitution. we went to a commercial break, and the good of them are -- former chairwoman turned around, very agitated with me, started to shake her finger and my face and said, jennifer, i am sick and tired of republicans saying democrats do not care about the constitution. i am tired of it. i do not want to hear it again. on extended expression of her frustration, throughout the break, and the last thing i remember her saying before we got back to the show was, i'm tired of it.

i do not ever want to hear you say it again the democrats do not care about the constitution. we went back on air. the host asked another question about the case. he turned to me and said to his listeners, former congressional candidate jennifer horn is still with us. what do you think about that? i looked at kathy and said, well, i think the problem is that the democrats do not seem to care about the constitution. [applause] that is a fight we continue to face today. our next speaker is someone who understands that fight. in fact, what i am particularly fascinated by when you read our chairman's biography on the back of this program, the one part in particular that caught my attention was, as chairman in wisconsin -- he is a former chairman of the state of wisconsin -- under his reign, republicans not only defeated the democratic senator and elected ron johnson, they gained two house seats, one of the governor's office, took back the state assembly, the state senate, and defeated the leaders of both of those chambers.

what do we have before us right here in new hampshire coming into 2014? exactly the same fight. we have got to unseat maggie hassan. we cannot allow somebody who would build a budget on funding that does not exist to stay in that office. we've got to defeat jeanne shaheen who thinks it is ok to use the irs as a political tool. [applause] we got to grow our majority in the senate, and by god, we will win back the majority in the house next year no matter what. every single one of us are going to stand together in that effort. it is my great privilege to introduce to you the chairman of the republican national committee, a gentleman who i want you to know was one of the first people i called when i took this job and started asking him for help, and his immediate answer was, whatever we can do. whatever i can do. he has always answered the phone for us. he is the high new hampshire

100%. please welcome chairman reince priebus. [applause] >> well, thank you. thank you, jennifer. listen, you are all a special place, a special place in our history, a special place in our party. i'm from wisconsin, one of those places that likes to brag about the birth place, but tonight, new hampshire will be the birthplace of the republican party. that is coming from a cheese head, ok?

[applause] you know, jennifer mentioned a couple of people. it reminds me how important candidates, how important our leaders are to the movement that we believe in. you've got great people here in new hampshire like steve depree, juliana bergeron, phyllis woods. you got a chairman and mark smiley, susan hudson from vermont is here. you've got great people who care about this party. i want to talk about something that i used to say all the time before i started a speech. i think it is fitting that rand paul is here tonight, a great leader in our party that stands for freedom come of the constitution -- freedom, the constitution, republican party as well. how about your senator, kelly i

had, -- ayotte, who is standing up for this party, for the constitution, for liberty and freedom? i used to ask this question, and it is pretty simple. what does this party need? the answer to this is found here tonight. it is found from where i am too with scott walker, paul ryan, and ron johnson. [applause] our party needs a couple simple things, people of their word to run for office, to win, and then go govern like you campaign. it is a pretty simple formula. tonight, you exemplify that with kelly and rand and the direction of this party that your great chairman is taking you. we've got a lot of fight for in this party. we are in a battle for freedom. it is the same battle that

founded this party. it is the same battle that shape that -- that james madison reaffirmed in the bill of rights. it is the same battle that founded our country. here we are today. we are in obama's brave new world. [laughter] you know what? he is delivering everything he promised. he is not doing what he didn't say he would do. he is doing exactly what he said he would do. now, we have government gone wild. some people wonder why we are for limited, accountable government. i think recent events should remove any doubt why these principles are so important to the republican party. i do not think for a second that these latest scandals are a one- time thing. it is the irs that is going to enforce obamacare now, the same people that targeted conservative groups, and it

wasn't just conservative groups it was any person or any group that had something critical to say of the current administration, a president that is in love with the sound of his own voice, but not in love with leading, a president that puts ego, power, and a hatred for dissent above everything else. that is barack obama. that is the leader of this country. i do not think this administration realizes that the first amendment was not a suggestion. [laughter] [applause] the bill of rights is not a wish list. it is a set of nonnegotiable limits on the federal government. that is why this week and last week i called for the

resignation of eric holder. [applause] if the president of the united states doesn't fire him, the message will be unmistakable -- the president of the united states leaves his administration is above the constitution and does not respect the role of the free press. and it is more than that. don't we forget that it was eric holder reading the miranda rights to the christmas day bomber. it was eric holder that was so in love with these rights that he would read the legal rights to the dead body of osama bin laden. he said it would be his living legacy -- of all the things to make your living legacy -- it would be his living legacy to try the 9/11 terrorists in civilian courts. fast and furious, contempt of congress, including 17 democrats, and he comes back and says, well, i had a conflict with this associated press investigation.

one thing that people are not talking about is this -- eric holder got in front of tv, and he said -- i don't know if you remember this -- he said this was the biggest leak that he is ever seen, the biggest leak in his career. in fact, he said it put americans at risk. yet the president doesn't know anything about it. [laughter] the biggest risk of his attorney general's career that put americans at risk, and the president doesn't know anything about the investigation. that's the new defense. i didn't know about the irs investigation into conservative

groups. i didn't know anything about it, even though senior senators, including one senator from your state, has been begging the irs to attack the tea party and conservative groups, but he didn't know anything about it. didn't know anything about it, except as white house chief counsel got a report three weeks ago. didn't know anything about it, even though his chief of staff knew about it before the report was issued. didn't know anything about it. this is leadership? this is the president of the united states? i've got to tell you, your chairman did a tribute to people in the audience that served in the military and sacrificed for the things that our party believes in, and all americans not even our party, but everybody -- freedom, opportunity, liberty. those are the heroes of this country. we owe them a responsibility to uphold those principles. one thing that is true, i do

have a very weird name. [laughter] i am happy to be with a rand tonight. reince and rand. [applause] i remember a few tweets, somebody said, what is going on with the party? we've got mitt, reince, rand. what is going on here? we named our kids normal names. jack and grace. we went the other direction from my parents. [laughter] my little guy is eight. he is a fun little guy, curious, a good reader. how many people have been to the world war ii memorial? i think you would agree with me, it is one of those places that you get out of it what you are willing to put into it, right? i went with little jack because i want him to know what our country is all about emma to appreciate -- about, to appreciate all the freedoms that people gave us. we walked around, and he is a good reader, reading the quotes from eisenhower and taking our time -- some of you who have been there know what it is like

and then we walked up to that wall, that black wall with 4000 golden stars. each one of those stars represents 100 little guys -- obviously a little bit older -- but just like jack did not come home to mom and dad. i know you can never, ever, ever put yourselves in the shoes of a parent who goes through that, but as a young parent, in that split-second you look at your little guy, and you just wonder about the sacrifice. it hits you. in front of that wall and gold on the black writing, it says, here we mark the price of freedom. that is what this is about. it is about freedom. that is what we are fighting for every day. i know we've got to do better in these presidential elections. we've got a tale of two worlds

going on. you've experienced a taste of it here too, just like i did in wisconsin. you win about everything imaginable in the off year, but then you get to the presidential election. i want to talk to you for a few minutes about what we are doing. i want to tell you what growth and opportunity is all about. i want you to know that we cannot be a party anymore that is a five month party before presidential election. it is a world of permanent politics. we are trying to build out a party that understands we need to be coast-to-coast, granular, every community, clipboard in hand, asian, african-american, hispanic. new england, all over the place, nonstop, big party, politics all-time, registering voters, going to community events, going to swearing in ceremonies, and working nonstop. we cannot be a five-month parachute organization getting

huge and raising a lot of money, dropping in, and expecting to succeed. you know what? we are not running against al gore and john kerry anymore. this is a new world. two years ago, when i walked into the rnc, some of you may not know this, but we were $26 million in debt. something i haven't shared a lot. you would agree that the rnc and dnc are probably the two biggest political organizations in the world. when i walked in, both credit cards were suspended for nonpayments. 80 employees in 2011. do you know how many barack obama had in florida? hundreds. if we are going to compete, we've got to win on the ground.

if we are going to compete, it means we need to be huge, right now. that is what this project is all about. we need to speak to people from the community, in the community, working in that community, hiring the people from the community to speak to the people in that community. that is how you win elections. secondly, branding and marketing. we do not tell people who we are anymore. we are the party of freedom and opportunity, and equality, but you wouldn't know it. we are not out there saying it. but we are going to be. we are going to be educating people about what we believe in and what we are about, but the principles are of the republican party on a year-round basis, not

four months ahead of time. when is the last time we have seen flyers that say, i am a republican because? we've got to protect our brand. it doesn't matter whether you are for rand paul, paul ryan, arco rubio, telling -- kelly ayotte, susana martinez -- every one of these folks, they are going to have a big fat r next to their name, and it stands for republican. we've got to get that straight. our digital and data capabilities have to improve. i will not bore you with the campaign-finance speech, but i can assure you that the rnc has to be in the middle of it and it has to improve. it will take a lot of time and a lot of money and a lot of people to get on the same page sharing data, big data. it's an endeavor for this party that we have to work at. now we have the opportunity to do it. the last thing i want to talk to you about. i happen to think our primary system, not the early states -- i was a general counsel that helped make sure that new hampshire was an early state carveout, so i'm not talking about that -- [applause] i'm going to tell you what i am talking about.

i think the slicing and dicing has got to stop. we've got to grow. we've got to let people in that door. i want to tell you two things that i am bent on fixing. number one, we cannot anymore allow moderators who are in the business of creating news make that news at the expense of our party and our candidates read it is over. we are done. -- at the expense of our party and our candidates. it is over. we are done. [applause] we are done having anderson cooper and george stephanopoulos depose our candidates in front of national tv. [applause] second, the second thing, some might say, wait a second, isn't this something pretty big? mitt romney never defended himself. it went all summer, got defined. tell you what is going on. this will be in the weeds for a second. number one, you know there is primary money and general money.

back a few cycles ago, these convention started moving to the end of august. they did that because the candidates wanted to shorten the time they would have to rely on public financing. conventions got moved later and later. in this case, mitt romney goes through a bruising primary, he's out of primary money, he sitting on millions of dollars in the general election bucket in june, but he cannot get it because the convention is in august. so he is the proverbial duck in the pond that cannot get to the money that is sitting in his campaign. that is why we are talking about moving the convention to the end of june. that is why we are talking about making sure that we have a say over who the moderators are and who the media partners are.

it's not an establishment takeover. we are trying to protect the candidates, the nominees, and the things we believe in, the things we are celebrating tonight. look, you are all leaders in the party. you would not be here. you all have your own networks. we want to do you proud. we want to build a big party. we want to build a party that works with people, that shares data. we want to be a party that wins together. that is what we need to do. i want to tell you a little story as i close out. it gives you an idea of where my head and heart is that. i met with a person who had been very helpful to our party. i will not share any names, but i will tell you he is a very outspoken -- we've all been through this, one month after the election, obviously very frustrated, like we still are today -- we were talking about,

what do we need to do to get this party straight presidential elections? -- for presidential elections? he's a tough guy, i knew it was going to be intimidating. i got two minutes into it, and he said, hang on a second. timeout. here's the deal. you are young. you're smart. that's debatable, though he did say that. you're young, you're smart, and if you want a job here, i would love to have you. i will give you a job down the hallway. here's the thing. if you are not going to be big, and you are not going to be bold, and do not waste my time. don't waste your kids time. don't waste your wife's time. don't waste your life. we are all called to be big and bold. whoever did the prayer tonight,

i thank you for that. i am thankful for a party that prays before we sit down. [applause] we are all called to be big and bold. that is my pledge to you. you are all in it like me. it is not glory. it is the grind. it is a grind we have all taken up because we want to have a country that returns itself to the principles that we are celebrating tonight. i am honored to be here. i'm honored to be your chairman. i'm honored that you're chairman of a couple of months ago and said, we are going to have a dinner in new hampshire, and i would love nothing more if you could help me to senator rand paul to come and kick off his new hampshire gop. we all did our best. we are fortunate and blessed to have you here, senator paul. it is a blessing. we are grateful for you and everything you have done for our party. [applause]

the last thing i would say is that i am also grateful that i am going first it does with a 13 hour filibuster, i'm not going to be here in the morning. inc. you, god bless you. -- thank you, god bless you. [applause] >> thank you, mr. chairman. inc. you so much. -- thank you so much. before any of you arrived, there were what felt like hundreds of media outlets setting up in the room. i was like, what is the media here for? what could it possibly be, senator? i am really very pleased that senator paul could join us here today. i actually met him, and i bet

you do not remember this -- i would not expect you to -- in 2007 when i was still hosting a radio show down in nashua. the senator was in town. he was campaigning for his father. we talked about his dad an awful lot, but one of the questions i asked him was, what about you, do you think you'll ever run for office? i do not even think of president. i said, we'll never run for office? he said, no, my dad is a politician in this family. with all due respect, i think you might have been wearing the same jeans that day as well. [laughter] i am very pleased that senator policy with us today. i am i am a big believer that we cannot win if we do not broaden our party and embrace all of the voices. i say all the time, whatever it is that draws you to the republican party, whatever part of life, liberty, and the pursuit of happiness inspires you, i want to stand with you. i want to fight with you for those values and principles. we must together. i think senator paul has been a great voice for the message. he has been a strong voice for

limited government, balancing the budget, and in the last couple of weeks, he has been a leader in the fight against this administration on the irs, and ghazi -- benghazi -- [applause] and he is the first person to go was the first person to go to the press and look into the camera and say straight out that hillary clinton is not qualified to be president of the united states of america. [applause] thank you so much for joining us. please welcome senator rand paul. [applause] >> thank you. thank you. you can always tell that there

is a sign that it might be an easy crowd if the prayer is interrupted by applause. you got a great chance with that crowd. [laughter] then if we applied again with the prayer. it is good to be part of a group that does believe in prayer. -- applaud again with the prayer. it is good to be part of a group that does believe in prayer. i need to get one thing straight before i get going. i believe we have to have border control. i believe there is absolutely no reason we cannot have a fence is we've got to keep those people from massachusetts out of new hampshire. -- offense because we've got to to keep those people from massachusetts out of new hampshire. -- a fence because we've got to keep those people from massachusetts out of new hampshire. [laughter] you think i'm joking. about a month ago i got in the car to work, and i thought i

wanted to say something about drones. i have been asking the question for a while, so i got up and spoke for 13 hours. [laughter] i went to cpac the next week, and i talked to one kid, and he summarizes my speech in three words -- he says, don't draw me drone me, bro. [laughter] he did have a point i wanted to make. i think it is a point that is incredibly important. it is a point that sometimes we do not always agree on, but i think we should agree on it. the question i was asking was, to the president, do you think you have the authority to kill on american -- an american on american soil who was not involved in combat. his response was, i do not intend to. i haven't done it yet. i might. [laughter] it is sort of like him saying that he doesn't intend to break

the bill of rights, or he intends to honor the second amendment. the oath of office says, i will defend the constitution. i will preserve and protect -- and attacked the constitution. it doesn't say i'm up i might if it is convenient. -- it doesn't say, i might, if it is convenient. we went back and forth. we could get no answer. finally we got an answer. people say, that is absurd, he would never kill an american. i think my wife said, ruin their caf? experience. the thing is, we passed the year before legislation that gives her government the ability to indefinitely detain anyone of you. without a trial, without a lawyer, and actually send one of you to guant?namo bay. that sounds absurd also. the president said he doesn't intend to use the power.

it is not about intention to use power. the reason we keep power from our government, while we have always jealously govern -- guarded our power, and we've wanted to limit the power of the monarch from the beginning, we are afraid about the chelation of power. madison said, when somebody has power, you need to have a certain degree of distrust. madison also said, if government were comprised of angels, we wouldn't need to have rules. patrick henry said, the reason we wrote the constitution was not to restrain you, it was to restrain your government. the first amendment is not about restricting your religious freedom. it is about restricting what government can do to your religion, how they get involved in your religion. these are things, whether your officials say they will use them or not.

they are important. you can imagine a situation where an arab-american in our country is communicating by e- mail with a cousin who lives in lebanon, and somebody says the cousin is a terrorist, and now you are associated with terrorism. do you think you would at least get a lawyer to defend yourself? when i brought this question up, another republican said, well, i said, could you send un- american to guant?namo bay without a trial,without an accusation? he said, if they are dangerous. i said, that begs the question, what makes them dangerous? when i see in the young soldiers who come back -- my wife and i just helped build a house for a soldier who lost both legs and one arm -- when they come home, i asked them what they are fighting for, and they say, the bill of rights. that is the freedom. we talk about fighting for freedom, we have to define what

we are fighting for. it has to be at the constitution, the bill of rights. some may not agree with this. think about it. we had the boston bomber recently, and i was at a charity event about a week later, and a boston policeman was there giving a speech -- one of the best speeches i've heard in a long time -- he ran to the scene, he helped apply tourniquets, he helped people at the same, he had the same thought every one of us would have, anger, wanting to punish these people. he still has that. i still have that. it is human and normal. he said what separates us from them is that when we did finally capture them and guns were gone and removed, once it was all removed and he was captured, we sent our suspect to a hospital. he is going to be tried in a court of law. he is going to have an attorney. in their country, he would've been dragged through the streets and beaten to death with a tire iron. we are different than they are. it is our bill of rights, our laws, going through the process that makes us different than them. with regard -- anybody in here a big fan of obamacare? [laughter]

i figured there wasn't. the president just wants to take care of you, he doesn't think you're able to do it for yourself, and so does anybody feel comforted that the new irs agent in charge of your medical records will be the same agent who was in charge of targeting the tea party? i think really there is great to be such a level of distrust, such a level of feeling, how will they ever cross that barrier again, i think there is going to have to be some sort of independent commission. i do not see any way the president can gain back trust. [applause] for goodness sakes, somebody's got to be fired. if not go to prison.

[applause] [cheering] the president doesn't think you're are smart enough to take care of yourself. is that obama care. i want to tell how he will take care of you. they used to have 18,000 medical codes. i am a physician. when you come in to see me, i marked on a. that is how it gets billed. there were 18,000. obama is going to make you healthier. there'll be 140,000 codes. among these close will be 312 new codes for injuries sustained by animals. among these codes will be 72 new codes for injuries sustained by birds, including nine new codes for injuries sustained by the macaw. [laughter] i've been in practice 20 years, and i have never seen that injury. i'm waiting to see that. [laughter] there will be two new codes -- this is to keep you safe and healthy -- two new codes for injuries sustained by turtles. [laughter] you say, why would there have to be to? the government needs to know

whether you are bitten or struck by a turtle. [laughter] just try to take care of you because you cannot do it for yourself. kids get their news through youtube and videos. do not watch the news much. i 16-year-old son sent me a clip of jimmy kimmel on the street, and it was pretty hilarious. he was out on the street and he says to the first person who walks up, you understand that the president has pardoned the sequester and he sent it to portugal? [laughter] that was not the response. the response was, i appreciate the president. he is such a good man. he wouldn't send it to portugal unless they deserved it. they all responded the same way. then he goes, you for that north korea israel and the saber and launching missiles, but the president has sent the sequester to north korea? and they are like, damn right, they deserve it. [laughter] i think the president is losing the optics of this.

the president is losing the public relations battle. he says, whoa is me. i've got to close down the self- guided white house tours. when he does that and in the same week he announces that he has found an extra $250 million to send egypt, in addition to the $2 billion we have already sent -- they've got money going to be sent overseas, but not enough for the self-guided tours at the white house. he says, i've got to fire the air traffic controllers. i've got to fire the meat inspectors. we've got a $3.8 trillion government, and he cannot find anyplace to cut? if you've seen the chart of what is going on with spending over the next 10 years, it goes like this. if we had the sequester, it goes like this. we still increase spending over the next 10 years. you cannot even see the white space between the lines. he says, we do not have enough money. i have come up with a few

suggestions. number one, if you just do not rehire the people who leave for retirement, that is $6 billion a year. he waited a year and a half before he even got started. that would've been $9 billion. he didn't do anything. you can save $10 billion a year by having competitive contracts. meaning you do not have davis bacon, your schools will cost 20 were dirty percent less. -- 20%-30% less. you do not have to pay new york union scale. there are smaller items that run throughout government. for example, last year he spent $325,000 on a robotic squirrel. you might ask yourself, why would you need a robotic squirrel? that's an important question. the scientists wanted to know whether a rattlesnake would strike a squirrel that was not wagging its tail, but they could not get a squirrel to volunteer.

[laughter] they built one. guess what? the rattlesnake will bite the you know what out of a squirrel out of a squirrel that is not wagging its tail. they spent $500,000 on a menu for mars. if any of you've got a 26-year- old living in your basement and you'd like to find him a job, this is a great job. a $5,000 stipend, it was in hawaii, all expenses paid. there were some prerequisites. your youngster had to like food. they went there for a couple of weeks and they studied this and came up with the many for mars, and guess what a bunch of college students came up with? pizza. [laughter] i got on the foreign affairs committee this year, and so i got to ask hillary clinton a few questions. i did happen to tell her -- [applause] we asked her on important question -- we asked her, did you read the cables asking for

more security? she said no. i said, i cannot imagine if i had been president, i would have relieved you of office without question. that is a dereliction of duty. [applause] they will say, they did a review board, the ambassador said, those decisions did not rise up to her level. that is precisely her culpability. how many countries are there in the world or dangerous than libya? they should have risen to her level. i am a physician. if you come into the emergency room, there are people triaging you. but if you come in with the stiffnecked and temperature of 100 five degrees, it is my job to make sure that the people out there know that you have to get back to see me. it is her job. we're talking about one of the most dangerous countries in the world, and they repeatedly asked for more security, and she does

not get involved and asks like, i know nothing. it is inexcusable. here is the thing. i come back and say, republicans do not provide us with enough money. back in may, four months before this happened, there was a request for a dc-3. they denied the request. four days later, they did approve $100,000 for an electrical charging station because they were greening the embassy in vienna. they've got money to show off for the european socialist friends about how we are greening up the planet with this electrical charging station for pretend cars that cost on average -- you pay for these also, you subsidize these -- $250,000 per car. that is what we are doing with the money, but we do not have enough. i said, why didn't you have more marines? her answer is, the marines are

there to guard the paper. i said, that's a bit insulting to any marine i've ever met. i think they are capable of guarding more than the paper. she said, that's what they always do. here's my point, benghazi is not paris. this is what they missed on the review board. the review board went through and had 64 good suggestions of things we should've done better. they missed one whole point. benghazi is not paris. and ozzy should've been treated and should still be treated like baghdad. it should be under military control, not state department control. that implicates the president and hillary clinton. [applause] when i think of all these scandals, i sort of think of old macdonald had a farm, old mcdonald's farm of scandal. here is scandal, there is scandal, everywhere a scandal. [laughter] it's hard to know which one we want to talk about, but i think all stem from one problem, that

that the government has a cumulative too much problem him of the president has accumulated too much power. not just this president, but maybe the last 10, because we have allowed that power to go from congress to the presidency. we have allowed the presidency to become too strong. lincoln had an egg knowledge meant good he said really any man can withstand adversity -- adversity, but if you want to challenge a man, you empowered. i think the president is failing that test of power. any person who would oversee -- he said he didn't know anything about it, but the word gets out that a lot more people knew about it than they are letting on -- any person who would use the power or abuse the power of government to go after their political opponents, i do not care if you are a republican or democrat or independent, to that brute force, that a lien force of government and use it against your opponents, there is something distantly and profoundly un-american about that. [applause] -- distinctly and profoundly un-american about that. [applause]

i have been talking with the rnc about how to make the party bigger. we have to do something different. we have run good candidates. i do not blame anything on governor romney. i think he was a good candidate, frankly. [applause] i think he was one of the most generous, honorable people we've had to run for office and a longtime. i do not think you will find as upstanding a person. [applause] but the party, we need to grow bigger. if you want to be the party of what people, we are winning all the white vote. romney got a higher percentage than mccain got. he got a higher percentage than bush. but we are a diverse nation. we will win when we look like america we need to be white,

brown, with pontyrails, with beards. we need to look like the rest of america. we need to be able to appeal to the working class did a message is, the government is not just helping those who have. the government is hurting the have-nots as well. [applause] one of the things we suffer from big government, from the debt, from the printing of money, is rising prices, and any routing standard of living. many people in this room, you can handle gasoline at $4.50. if you make $30,000 a year, when your gas goes to four dollars a gallon, you do not go on vacation. you have trouble getting around. you have trouble getting your kids to sporting events outside of town. that is big government. we need to be the party of we need to be the party that can express it in a way that shows we care about people. we need to care about people even if they are on government assistance.

people on on implement are not bad people. we need to be able to express that we are the party that is going to give them the opportunity to join the rest of us in the middle class. there is an american painter who writes, when you paint, you need to paint like a man who is coming over the hill singing. i love the image of that. we need to be the party that proclaims our message like a man coming over the hill singing. we need to be the party that has passion, that believes in things. we do not have to dilute our message. the constitution, individual freedom, all of those things, liberty, those are things young people can come to. they want someone who is genuine in how we present them. we do not have to dilute that message. i think somehow we have to combine the passion of patrick henry, give me liberty or give me death, with the passion of the proclaimers who said, i will walk 500 miles and i will walk 500 more just to fall down at

your door. we need to have that order, that passion that young people have. we need to combine that with patrick henry. when we do, when we combine that passion again, when we become the party who is like a man coming over a hill singing, then we will be a great national party again. thank you very much. [applause] [captioning performed by national captioning institute] [captions copyright national >>le satellite corp. 2013] we joined members of fema posole disaster team as they walk through a neighborhood in oklahoma. >> we are disaster survival specialists. 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. if they need housing, we have volunteer agencies. we make sure they have proper housing and food. register with fema. they can also go to the website disasterassistance.gov. we 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. we are -- we have come to get you registered with fema. americorps is a team based national and community service program for ages 18-24. femacorps is solely focused on disaster recovery and really. we are part of the disaster survivor assistance service. we register people in the field. we commit the next 10 months of our lives to responding to >> present --

president obama will travel to oklahoma tomorrow to speak with families affected by the tornado. we will have coverage here on c- span. i had at the 10th anniversary of the medicare prescription drug program, a special agent committee held a hearing on the ont, savings, and impact seniors. this is one hour and 15 minutes. >> good afternoon. a the interest of time since vote will be called at 3:40 p.m., senator collins and i are going to forgo the opening we will getnd

right in with your testimony. we will insert our statement in or record lex let me introduce you -->> let me introduce you we're going to hear from margaret warner. is a medicare beneficiary herself. she is volunteered at the medicare rights center in new york city for the past eight years. this capacity, she has listened to other beneficiaries and their themies, and provided

with information on a wide variety of issues. and aa volunteer beneficiary, dr. warner has a unique perspective on medicare part d. is a research professor at the health policy .nstitute at georgetown recently, dr. hold lee has studied various aspects of thecare part d, including spending trends and the use of formularies. he was also recently appointed to a three-year term as a member of the medicare payment advisory commission. , executive vice andident for policy

research at pharmaceutical research and manufacturers association. mr. smith has worked extensively in healthcare. romosco.t .e is the president of aarp this is a distinguished panel. because i said we are going to forgo the opening statements, since we have a vote coming up, we will get right with the witnesses. we will start with you. the your full statement will be placed in the record, and if you could give us about a five minute summary. thank you so much. i have been a health line

volunteer for the past eight years of the medicare rights center in new york city. the medicare rights center is a national nonprofit organization that works to ensure access to affordable healthcare for older adults and people with disabilities. as a volunteer, i provide information and counseling to medicare part d beneficiaries and their family members on a variety of issues. this work is deeply gratifying because i can help people solve very real life problems. i have seen the positive impact that access to prescription drug coverage under the part d benefit has had for so many older adults. and people with disabilities.

while these benefits are undeniable, many barriers to accessing needed medication still exist. i believe that the part d benefits can be made even stronger by addressing these issues. i speak to countless beneficiaries who go to the pharmacy to fill a prescription only to find that their part d plan refuses to cover the medication. when this happens, most beneficiaries leave the pharmacy in two-handed and without answers. upon calling the plan, they are given any number of reasons for the denial, for example, they play once than to try a less expensive drug first. the drug is not on the plan's formula, or the drug is being

taken for an off label indication. before beneficiaries can even begin to appeal to have the drug weerage, i must counsel that first must request a written coverage determination from her plan, and include a letter of support from her doctor. many of the people i speak to have not received instructions from their plan on how to do this. callers often expressed frustration at the need to jump through so many hoops because of these hoops, some will try to pay for the prescriptions out-of-pocket. others will sit would go without their medications because they can't afford it. ed a woman in florida who received a denial notice from her part d plan stating that

they would not authorize a drug for her rheumatoid arthritis without additional medical information. when she had previously been living in ohio, this same plan cover the same drug. she was quite confused. an upset as to why they would not fill this prescription this time. . it took four weeks for her to get the prescription covered. in the meantime, she had to suffer through the pain and inflammation caused by her arthritis. the large number of plans available, and the frequent plan changes, make it nearly impossible for many of our poor to make the right decision about enrolling in a new plan, or -- theirheir ex 16

existing plan. i have found that from year-to- year, my own out-of-pocket costs for the same coverage, for the same medication, can vary greatly from plan to plan. i speak to many beneficiaries who attempt to understand their coverage before they enroll, only to find out after they have enrolled that their medication is subject to numerous it isctions, or that much higher than they can afford. to get the most out of your coverage, you must know the differences between preferred drugs versus nonpreferred brand- name drugs. generic drugs.d versus nonpreferred generic drugs. versus specialty drugs. you must know how to obtain your in networkpreferred

pharmacies, versus nonpreferred in network pharmacies. versus mail-order pharmacies. of course, you must know whether your drugs are subject to any restrictions. many good done things for older adults and people with disabilities. there is much more that can be done to improve the program. thank you for the opportunity to testify about my experience helping people with medicare part d. >> thank you dr. warner. we are looking forward to questions as we dig into this issue of the benefits. dr. hoadley. >> thank you. i do appreciate this opportunity to talk about my

ongoing research work on the record of part d since the law was passed. part d really marks several first and that medicare. it was the first outpatient drug coverage for medicare beneficiaries. the first part of medicare solely available through private plans. the first time medicare they had provided assistance to low- income beneficiaries not relying on medicaid to provide that. and a gap in coverage also as we looke doan -- at the record of party over the time since it started, there are successes but ongoing issues and concerns. i want to mention a few a beach. the successes. the cost of part d has been 30% lower than the initial budget projected. that is an important thing. something we do not often get to talk about. -- but the a result

program has been able to take advantage of the lower spending trend on prescription drugs over the. of time. lower enrollment has been a factor, although not one of the ones that we should be happy with. the second successes that enrollees in part d have had reduced out-of-pocket spending and access to their needed drugs. research is supportive of this finding. congress has taken steps to figure -- fix the design program. that is on schedule to be phased out by 2020. that means that people are not running into the problems when they hit that as they did before. that issue will have gone away. in 2006ram starts

despite a not -- a lot of initial concerns. while there were glitches along the way, many cases during the initial problems were fiske's -- were fixed. issues do remain. although congress and the cms have made important adjustments, there is room for improvement. complex andns confusing to many beneficiaries, as you just heard discussed. despite important efforts to streamline the program, there are too many plans with too many comp amended -- complicated differences. people report it is a confusing benefit. people do not always the plan that is best for them. furthermore they do not always look at alternatives that might save the money and put them in a better situation.

second, not every medicare beneficiary has drug coverage. it appears from data that 10% does not have adequate drug coverage, does not have part b that is as good or better. we do not fully understand who those people are, and why the as happening. that is what we need to redouble efforts. there are really important issues remaining with the low income subsidy programs. it has been a big help to people who get the subsidies. only 40% of those required to apply actually have done so and gotten a low income subsidy. than halfalf -- more are not enrolled in the subsidy. they're not getting the extra help they are entitled to. furthermore, those with the subsidy generally must which plans on a fairly regular basis

in order to gather the benefits of the subsidy. for example, the plan with the premium charge. 1.6 million beneficiaries were part of the low income subsidy program paying a premium to stay enrolled in part d, something they do not have to do they were to switch to one of the eligible plans. even the fact of switching to other plans means that people's coverage is disrupted. both ways.problem there are things that we can probably due to address some of these things. beenugh the cost has below projections, spending trends in the future add cost pressures. the way the patent expirations has been responsible for take -- keeping spending down is slowing. we will not get the advantage of that in the future. new drugs tend to be expensive

specialty drugs that come at a high price tag. , and needtherapies access to those drugs, but they are going to be expensive drugs. -- theailability .otential to use the rebate and better medications by plans to make sure there is appropriate use of those drugs. the bottom line is that we can point to clear successes in the program. it is critical we do not rest on the success and address the outstanding issues. as one last point, let me observe that the experience in launching this program may offer some bible lessons to the launch of the insurance exchanges this fall. i would be glad to talk about that.

thank you for the value of your research. mr. smith? >> mr. chairman, members, good afternoon. highlye part d has been successful. like my colleagues, i will go to a few points where we believe improvements can be made. overall, it has been highly successful. nine in 10 seniors have drug coverage. 94% are satisfied with their coverage. program costs are 45% less than initially expected. ,n average monthly premiums which remained at $30 from 2011- 2000 13, are half the original forecast. medicines play a central role in fighting diseases for seniors. only 10% of for medicare costs. growth and spending have been a knowledge.

growth in spending on medicines have undergone a slowdown in recent years. in each of the last three years, cbo has reduced its forecast for part d by over $1 billion. further, cms says that spending for personal growth 1.8% in -- haved market wise occurred since rd began in 2006. one reason for slow growth in drug costs has been deeply -- prescription drug lifecycle, becoming generics. i have a slight disagreement with my co-panelist. i believe that the market works to obtain maximum savings on the lifecycle. is a five prescriptions filled with generics. it allows resources to be reallocated from older to newer treatments. due to the lifecycle between

2006 and 2010, the average cost fromay in part d dropped a dollar 50 to one dollar. it will credit policies to increase use of medicines on services. making this change, etc. esearch -- this equaled $13 billion in savings in 2007. newbury's or suggest even greater potential, for instance, increased adherence with medicines for congested heart failure to save medicare $22 billion in the coming decades. competitive structure is the reason for its success. these organizations already by drugs off the half of tens of

millions of people in the commercial sector and use their clout and ask for tees to negotiate premiums and cost sharing. i will beies have -- glad to come back and address that in questions. some suggest that more savings could come through part be government negotiation. we disagree. cbo's consistently found that giving the government authority negotiate we would have a negligible effect on's -- federal expending. some have proposed imposing medicaid's price controls on medicines used by low income medicare beneficiaries. proponents of the suggest it would be a return to the pre- party status quo. i believe that is not accurate. first the policy that has proposed applies to millions of people who were never eligible

medicaid drug coverage. part d extended discounts to 11 might people who didn't have them. and also increase generic use and lead to new cost of payment tools that has not been spread throughout the market. 2006.policy changes since analysts estimate these new cost at over $100 billion over 10 years. see mandated rebates as leading to higher premiums, fewer plan choices read researchers of also found that price controls discourage investment in new medicines at great cost. the party rebates could discourage r&d research in development.

in addition to improving medicines and improving lives, r&d is driving economic growth. i will conclude by noting that when any program, improvement came he made. not all eligible individuals are enrolled. seniors should be encouraged to shop more to make good choices. there could be improvements in medications in the specialty tier. however program improvement shouldn't undermine the successes of part d. innovation is challenging. there is a lot more to be done. all sommers will cost medicare and medicaid $300 billion annually by 2030. none of us want that to happen. hope for the future lies with innovation and i appreciate your invitation to testify. >> thank you. youratulations on

industry developing extraordinarily wondrous new drugs. this will continue. my name is robert romasco. . service aarp is a we think you for holding this hearing on the drug program. as we approached the 10th anniversary of medicaid modernization act, party is helping millions to get the prescription drugs they need. aarp continues to support of the medicare drug benefit. part d has improved their access to prescription jugs. prescription drugs coverage

plays a vital role in the health and security of older americans. part day has been a success in helping seniors get and stay healthy. as part of the affordable care it is slowly being eliminated through escalating discounts. these changes have helped save people more than 5.1 billion -- $5.1 billion. i like vegas opportunity to thank you for your support of this key provision. the estimate is 30% lower than cbo's projection in 2003. last year cbo acknowledged that taking medication helps prevent medicalns and other services. this shows the importance of part d in helping control spending.

and maybe successes of part d, we see opportunities from improving the program. our members, especially beneficiaries, tell us they struggle to afford prescriptions. concern. test is of to be eligible for the low income subsidy in 2013, if the series cannot have one dollar in savings. this is hardly enough to get the retirement. we have consistently opposed the asset test. instead we recommend further research to help understand what is driving utilization, and to ensure that any changes in the benefits will not interfere with access to necessary drugs.

part d enrollees are faced with increasing caution areas as the drug plans get more andlex, with more tiers, further aarp does not support a higher premiums based on income. seniors in medicare already paid into the system the payroll taxes, and those with higher incomes paid more over their lifetimes. in many cases, seniors with higher incomes are still working, and to pay medicare taxes because they do not have the savings they need to retire. aarp is concerned those with higher income base is made choose to not dissipate fundamentally changing the nature and quality of the program. we do however recognize we must take steps to reduce cost. aarp encourages commerce to enact legislation that will lower overall costs and part d rather than simply cost

shifting to older americans and asking them to pay more for care. we strongly support the medicare drug savings act and wire prescription drug made factories to provide rebates eligible for medicaid. this would restore savings they received prior to the enactment of ama. this legislation is estimate to save $141 billion of the next 10 years. aarp looks forward to working with congress to enact this sensible legislation to improve physical fiscal stability of medicare while protecting beneficiaries. we have also consistently supported legislation that would enable the secretary of hhs to use the bargaining power of the beneficiaries to negotiate lower drug prices. further we support reducing the market at close of the tee. .- exclusivity

in conclusion, we should focus on efforts to hold down costs, not simply shift costs. we look forward to working with members of congress on both sides of the aisle to improve part b and find ways to keep drug coverage affordable for people of medicare. thank you. >> thank you to all of you. we are going to get into questions. it will help flesh out. i'm going to defer my questions until our colleagues have asked there's. >> thank you. let me begin by commending you for holding this series of

10thngs as we approach the anniversary of the medicare modernization act of 2003. i was proud to be voting for that legislation. i think that it is possibly -- i'm going to go out i live and say it is the only entitlement program in history where the actual experience has produced much lower cost both for the government and for beneficiaries than was initially estimated. usually goes the other way. that is good news indeed. as is the high satisfaction rate. nevertheless, there are some very important issues that we need to explore as we approach the 10th year of the program.

dr. warner, i was very interested in hearing your experience in counseling beneficiaries. many part d plans now use medications you does laois and management tools, such as prior authorization, medication substitution, or quantity limits that restrict a beneficiaries access to prescription drugs. i heard -- i have heard concerns from my constituents that some firstlans have a fail policy in which a beneficiary may be prescribed a more expensive medication but first has to use a lower cost drug or a plan of preferred medications

and actually experiences the failure of that medication before they are allowed to use the medication that their doctor wanted to prescribed in the first place. i know of an elderly woman in maine who had the experience of having side effects from a drug that was the lower cost drug. had a terrible cough from a month. able to switch, she was fine. is this common in your experience. d of any suggestions? do you have any suggestions for how we can strike the right thatce between making sure plans do have the ability to legitimately control costs, and yet not put our seniors through a situation where they are going

to have to experience the failure of the drug before they can get the drug their doctor knew was the preferred dedication in the first place. >> you have it exactly right. from peoplecalls who have gone through the process. the doctor has prescribed the drug, and the plan says before we will cover that dread, you must try sometimes 2-3 other drugs. very often the caller will tell me i have tried those drugs. i had a terrible rash when i got that one, or a terrible intestinal problem, or they have already been through those.

in order to convince the plan, they need to get documentation from the doctors who prescribed those. that is not always possible or easy to do. a very say that is common problem among the .allers that we get i am not sure i have the ability to answer the question of how the lot of these people who really need the drugs that the doctor has prescribed. and still have some cost- containment issues. >> let me ask the rest of the panel whether it is good to have these verified that you get

those kind of costs. we have gotten them even when the physician has written the letter saying the person needs this particular drug. why don't i quickly go down the panel. think that there are some potential things you can do. one of the things is to understand how often this happens. we know there is good data on how many drugs this limit applies to. we do not know how many people run into these issues. just more information would be better. plans can be forced to target these measures better. there are some cases where there are appropriate measures, safety measures in some cases. that should be measures

are appropriate. if plans targeted them to a select center of drugs, that would probably help. we also need clear and simple processes to go through this. we hear the same thing from doctors. the paperwork involved to request one of the exceptions is a realrization burden on doctors. i last comment, it goes to this point that you are talking about a moment ago, which is you have already tried the drug before. a better method to track this is if a person moves from plan a-b. the information if they try to improve the information should be carried along the plan be. if somebody is new to the program, you're going to have to involve a doctor in some way. better way to carry the history forward. i think there are things that are not -- there are simple

solutions however. think that there is real opportunity to improve the situation by bringing along information as a transfer among plans. that something we support. i think that is a step forward for the inefficient areas. cms will also note that has looked out some plan practices and indicated that there are ansys is in which we think you are overdoing it and we don't want to see that. it may be that we should be looking more to identify other plans that are outliers where we are seeing a particular pattern

of problems. finally, i would say the it may be, i am feeding out loud, it may be that we should think that in some instances may be the presumption should be in favor of the beneficiaries of they do not have to fail first. >> thank you. i know my time has expired. i'm going to ask for the record 's.you provide me with aarp >> we are hearing transparency, portability, and the relation between the doctor and the patient. my personal expense of doctor understands what i need, what i they makebefore, and good judgments based on the total costs of impact. studies have shown that when physicians see the cost impact, they make a good judgment of

what is best for you medically combined with the cost. improve thee would situation. >> thank you. >> senator warned. >> thank you. i want to look at another part of this. traditional medicare spending goes towards the care beneficiaries with multiple chronic conditions. prescription drugs are a vital part of their care. they allowed to manage successful chronic diseases impart to of front investments and innovation in those pharmaceutical industries. unfortunately, just because the drug is prescribed does not mean a drug is actually taken according to the terms. tryingtters when we are

to get better outcomes at lower costs across our healthcare system. i think you alluded to this duty -- study. patients at high risk of cardiovascular disease who reliably took their cholesterol fewerhad about 35% hospitalizations compared with those who didn't. that is a remarkable difference. i understand the new cbs -- study shows that increase the prescription drug use reduces the cost of other health care services. one important way to improve effective drug use is through the medication therapy management program that you spoke about. medicare part d requires these programs for seniors and those with multiple chronic conditions to help with their medication regimens. andfully increasing,

assuring that the drugs are taken effectively for each individual. how can we improve on the medication therapy management program, and if there are other evidence-based strategies that we might employee to get more people taking their prescription medications successful. could i start with you on that? >> thank you for the question. this is an area which has tremendous potential. it is one of the areas where you can say we can actually get the cost savings we all want with better outcomes for the better beneficiary. in terms of medication therapy programs, we are encouraged to see cms publish the first study this year about the experience of medication therapy programs. and congestive heart

failure, the medication therapy management programs were in fact helping lower hospital cost. that is good news. better quality care, better results for the beneficiary. >> i want to make sure i understand. lower costs on those two diseases. because they found they were not lower cost. >> i believe that is right. , think that a couple of points we actually need a lot more research. we need to know more about what is going on with the medication therapy management program. so thatrategies work there can be broader learning and we can take advantage of this opportunity. you asked about other strategies. -- one mibated to related -- one that might be related is

synchronization. you may have a senior taking five different medicines. they have to go to the army see five different times in the month. theut it all to gather -- senior only has to go once. you see all of those prescriptions together so that if there are issues in the indications of the medications, you have an opportunity to take care of them. looking at strategies like that and learning more about how it is working, and how it is intended is important. we need to learn why cms reported that a fair number of seniors who were contacted for therapy management were not taking advantage of the opportunity. >> the first barrier to compliance is to make sure you provide --

-- the second thing is that compliance with it, if you're taking medication when you're 60, you probably will be more likely to do it when you are retired under medicare. we need to look at the entire compliance issue and learn from how the private plans are encouraging compliance as they have responded to things. those issues, making sure the cost is low enough so that you can afford the drug in the first place are worthy. understanding why people skip it even when they know it is good for them. >> would it be all right if i ask if you could quickly add anything more. >> i would easily second the

comment i have heard on affordability. it matters a lot. you need to know more about what the plans are doing. more information in their star rating system. a consumer can save this plan has a better track record of helping to improve adherence. there are some solutions that technology could play a role to synchronization. even other things like taking the medication. if you have multiple chronic conditions, you have 4-5 different drugs to take. each one says this food, on empty stomach. as ang the patient pharmacist or a nurse, up figure

out what is the right way to take medications across the day. how can we provide more aids and tools to help people take them together, get them lined up. get the most important drugs and build systems for the patients. >> very thoughtful. i'm out of time. a brief remark you would like to add? i'm not sure what that means. it is a very helpful point about going back and understanding. >> we have great ideas for how we can make the right investments. that has to be what we are aiming. was want to underscore what said that cost is still a major

barrier. it is not unusual in florida it is senior, fortunate not happen often, a senior is making a choice between medicine and food. that should not be in america in the year 2013. >> i want to thank the chairman and ranking member for having this year -- this hearing. , the affordable care act created what is called the independent payment advisory board. it is uniques -- in that structure. in over -- you have to have a recess vote of congress so it wouldn't be how we would .ormally pass legislation

also it contains a provision that a majority of the people making the decisions what impact payments to medicare providers and therefore could also impact what recipients would receive depending on what was covered. can those individuals -- they be involved in providing healthcare services to beneficiaries. theously they can serve majority who are making these decisions will be covered. i read the issue because i've heard from many physicians in new hampshire that they are concerned about how it will impact senior care. just this past month, organizations that represent a diverse sector of the healthcare industry small and large wrote to congress urging us to eliminate it.

i wanted to ask why that is. what impact do you think that it could have on medicare part b, and i would like to open it up to other panelists and have an opinion on this. thank you. >> you are correct. we have can -- expressed concerns about it. i think that i would say that starts with the fact that it could make major changes to laws that congress passed without the usual checks and balances from congress or the courts. i think that raises a lot of reasons for concern. i would note that in -- its advocates argue it will improve savings. i think that is almost certainly wrong. it is not because it will be made up of shortsighted people

but the reality is it has to meet suspending targets a one- year time frames. cbo has pointed out that it expects it to focus on payment cost. within the it will focus very much on part b and part d because those are called out in the statute to be targeted. canpulating payment amounts have significant effects on beneficiaries. because we have the market -- em we have, 84% i do not think you are going to that result from the board that

has been created. i think it is going to go the traditional way that can significantly restrict access. >> thank you. >> i would just note for the moment the low spending growth trend we have seen in the last couple of years has made the triggers that are built-in to that, even if you had been staff then existed, would make the kinds of deliberations unnecessary. maybe the observation to make here is that if we can continue to maintain a track record like this has maintain, and do the things we have been talking about to keep it working well, that will help make those double or a dashed liberations unnecessary. sure it is amake create new situation where people aren't -- one of the concerns is that super majority that is required.

question mark ad ipad?hought on >> the legislation calls for it as a failsafe. the real issue here is health care costs overall. if we can get them to grow at or lower, thate is where our problem is. that is the failsafe mechanism. that itthat the idea is there in case as opposed to amanda terry consideration. -- and mandatory consideration. we need a mechanism to focus on the spending. >> i appreciate that. if the failsafe is there and you are all concerned in terms of what is the care that people receive, i want to make sure that failsafe has accountability. so this congress can correct

them in a normal course. ending it.rter of i do appreciate all of you coming here today. thank you for the work that you are doing. >> thank you mr. chairman. thank you for very kindly leadership. this is a particularly important time for us to look back. it is so great to have the medicare right center. welcome. recalling for a minute the ferocious debate that took place when this legislation was first considered. i think you would have to start with the proposition that at that time the level of desperation among seniors for some measure of assistance with

their medicine was just extraordinary. at the time, it really felt like this debate had gone on for eons. inan her member this back oregon. we were talking about this very issue. i came to the conclusion that we were very -- we were really at a fork in the road. if we didn't take the opportunity to at least get started, it would probably be eons more before we would ever get this effort underway. i told senator warner -- war in -- i told senator warned, -- i voted for the legislation. at least we have gotten started and we have been able to help a lot a people.

your with respect to the future are really spot on. i want to ask a couple of questions by way of what is ahead. one of the major concerns today is how seniors are going to afford the specialty drugs, what are called specialty tier drugs. drugs that weren't on the board back when this program got started. cancer drugs, arthritis drugs, ms drugs. a drug where the government laid , large role with pfizer $25,000. a big risk for a seniors center -- will be your counsel with respect to how to deal with these specialty drugs that are so expensive, and increasingly

they are going to be injectable and play a bigger and bigger role in the healthcare landscape? your thoughts on specialty drugs for seniors? >> there is a particular problem with the specialty drugs for people who are really in lower incomes. what happens is for other medications, if the doctor prescribes the particular medication that is in a high tier, and i specialty tier, the to a lowerappeal tier, lower the price, if there is not another drug that that person can use instead. specialty drugs do not have that. one cannot appeal for a lower price for a specialty drug.

whoave had many callers have needed one of the specialty drugs for conditions like multiple sclerosis, for example, who can't appeal to the dump to the company because they are low income. one woman was living on $1700 social security income. she was above the level for the extra help. .hat is not a lot of income she had to choose between her multiple sclerosis drugs at high cost and food. or other everyday living expenses. i think the first thing would be the samea process of

kind of appeal that you have tier appeals. -- >> that sounds illogical. -- that sounds too logical. why do we have one more person. ,> on the chronic disease issue perhaps picking up where i left off, one of the issues with medication therapy management who is targeted for medication therapy management? right now you have to be hydro expenditures and him practice

-- high drug expenditures. we may be missing people who are not adherent because they're not taking the medicines. maybe we ought to be looking at what their total expenditure, conditions they have, and can it be helping rather than just hearing in the way we did read it have a lot of opportunity to make progress on cost and quality. >> my time is expired. i hope all of you will also start to factory in that these drugs affect people differently. for years and years, medicine has always been based on the proposition that this drug will affect harry and george in the same way. i think this is particularly important in the area of chronic disease where senator war in --

and relate to individuals. to do that right, we're going to need need to know more about the differential treatment of medicines were different people. gun of really the personalized medicine. senator nelson, thank you for your leadership. .> thank you senator wyden thank you for bringing up the appeals process. .nd for dr. warner's response to give you an example, at lady forlorida, when her drugs brain tumor went into the specialty category, and she had no appeal process, it went from $30 a month to $650 a month. , there is a need now

in any of the remaining three to comment about the appeals process. >> i totally agree with the point. pharma has been on point in support of creating the specialty tier in the same way tiers.other two years -- >> let's move onto another subject. the very same drugs that medicare used to pay for when the prescription drugs ,egislation was passed in 2003 because those people that had been receiving their drugs under medicare now are over age 60 five years old, they get their drugs in medicare. now, the price that the government is paying is not the

same. it is not the same to the degree of the statement by mr. o -- how can. o masco we justify that for these dual eligibles? >> thank you for the question. i suspect that i might get it. i can appreciate you putting it out there. let me begin by noting that medicaid has never been viewed as the benchmark for medicare for any service. it hasn't been viewed as the benchmark for position payment. or hospital payment. advocatedons aggressively for moving the do eligibles out of medicare -- medicaid and into medicare because of the restrictiveness that accompanied medicaid

benefits. i think that there have been major policy changes that are not taken into account when these constellations are done. thereample, since 2003 thatoverage gap discounts the cms estimated that just over six years and not to the 10 years we are used to comes at a cost of $30 billion. spun out over 10 years that will be $60 billion or $70 billion. it is paid by the industry. taking medicaid over here and only part of medicare over there and not looking at the totality does create an apple and oranges effect. finally, i will add we have

strong, powerful purchasers with lots of holes to drive savings. they do drive savings. 2012 arests today for 2004ower than projected in after the program passed. medicare as a whole has increased. so, medicare deserves their prices, good price. they are getting them. that is whyycb -- cbo has not off $100 million. we think that is the right way to do it. government price control layered on top of the market i believe will do significant -- will undermine the program effectiveness and competitiveness. it will lead to the results of

beneficiaries. i want you to tell your employer said that i give you an a for your response. if i were in your shoes, i would have liked to have been as articulate to respond as you do. it does not cut it. it does not cut it when the u.s. government is in fact a big purchaser that you talked about in a competitive marketplace. and to the united states government gets that discount with the medicaid, which is as almost as big a program eventually as medicare drugs will be. and the u.s. government also gets that discount in the veterans administration which is another multiple of tens of

millions of veterans each requiring drugs and the u.s. government also can set discount through the department of defense. so when we talk about the competitive marketplace, arerly since some of us invested with the idea we are trying to get the biggest bang buckhe tax payers but -- and you have someone who is eligible up until they get 64 but onf age and 364 days the 365th day they are eligible for the same drugs divided by remember thet, way we are phasing in under the

bill, the way they are phasing in is that the federal government will continue to pick up more and more of the cost at the donut hole is shrunk. out tosult, what they're be is balance in the system. i started my comments early on the by complimented you. >>understood area complimenting you on what your industry is doing is absolutely fantastic because of the miracles you are creating before our eyes and what you are researching and developing. in no way do we want to lessen that r&d. down to ae have come basic question of dollars and cents for the taxpayer. this is one we are going to have to look at. have took this on when we

passed the health care bill and i got to beat in the senate finance committee. this issue is not going to go away. you should face that. that is especially so over the course of the next seven years as the u.s. government is picking up more and more so that by 2020, 100% of the costs of medicare in that doughnut hole are going to be absorbed for the senior. , you look like you are ready to say something. >> i cannot support more fully. huge.s. government is a purchaser much more than individual insurance companies. it continues to bow full meaning that it is like telling walmart they cannot negotiate me that it is like telling walmart they cannot negotiate with procter and

gamble over prices area -- prices. the industry made the argument this would stifle r&d. through their market forces we have a generic drug and everybody is prosperous. they continue to be successful and profitable. the concept of negotiating authority is a critical idea. lengthening the biologic 7 years ism 12 to another possibility. it is another way of keeping our eye on the ball. the affordability of the trucks drugs the entire -- across entire health care system. wyden wassenator here. going on the history of all of

the, it is true that prescription drug benefit was first authorized and set up in 2003 and the prescription drug bill. it became very costly to the government. it was setting up a new delivery of medicare through an insurance company called medicare advantage delivered through an hmo which is an insurance company. what happened in 2003 legislation was insurance companies were given a 14% bump per senior citizen beneficiary. thatbecame so expensive when the health care bill came along, we had to save medicare because it was going bankrupt

and one of the major reasons was that federal government was paying out too much to the insurance company over and above medicare fee for service. that was leaned out over time through that health care bill. history of this whole continuum here, we have seen one over stepping and that now being corrected and that is why i bring up this prescription drug benefit where there is a significant increase to the taxpayer on the bill on the drugs delivered through part d. senator collins? >> t y. i am going to follow up on the interesting question in regard -- and this is an issue where i can see both sides of it. on the one hand, you look at the

va system where government has used its purchasing power for years to negotiate prices. we do it in the medicaid program. it was not just president obama who has included this in his touch it but the bowles-simpson commission also headed the recommendation which gives it some credibility in my eyes. on the other hand, you can certainly look at the marketplace and say that we have 1000 plants. there is lots of competition. we have sophisticated insurers who are doing that kind of negotiation with very good sinces for the consumers the prices are so much less for premiums advance had been -- and

can had been projected. 2 minds on this and which is the better way to go. mr. smith, from your perspective, since you can legitimately point to a successful program that has driven down prices with successful, sophisticated but if it should be extended why do we have in medicaid and the va program? >> thank you for that question, senator. the first point i would make is i think it is always possible to look somewhere else and find a different price point and say why does a different program get at this program -- at this price point?

it is central to the u.s. marketplace. it is a much more significant program than both medicaid and va. i think because we have statutory provisions that have set prices in those programs over the years because there are exceptional reasons for those programs does not mean we can expect that we would have the same effect if we extended that to medicare. i think extending these rules for smaller programs that have exceptional circumstances, veterans and so forth to medicare would send very negative signals both into the part d program and into the market as a whole. i know that there is a view that it is really just easily affordable.

when i look at what mackenzie says about pharmaceutical, in recent years pharmaceutical r&d had not been earning a return. what i see what analysts say echoes what mackenzie has to say. that we ares clear 80 point where this type of policy -- at this type of policy is going to force choices r&d and change the fundamental nature with premiums and so forth. it is going to change the nature of the program and the industry as an economic driver. final point i will make is that those programs that we are often

compared to, va and medicare, there was a broad-based effort to move prescription drug coverage out of medicaid into medicare specifically because of the shortcomings of the medicaid program. i think we have heard today while while at there are issues to be addressed, it is working well for seniors. are veryhose programs restrictive around access for more so than part d. art d alters -- offers broader range of drugs. many veterans who have va coverage are also enrolled in part d. they are using parted the because they are getting access to medicine they are not getting in va. we have a range of issues, but the most direct point i can make is i think what is being

proposed is a race to the bottom. there's an example over here of a program with a specific set of prices. should be transported over here. that is not been discussed around hospitals or doctors. that has not been discussed around hospitals or doctors. i think it does force real choices instead of being something that will be without consequence. >> with respect to the vital research and development of new drugs that the pharmaceutical industry does, isn't the american consumer really subsidizing that for the rest of the world which marked most on thees do have control cost of medications. i live in a border state with canada. in a way, it is the american consumer that is paying for that cost.

are we not? >> american consumers pay for the cost and consumers and foreign markets pay for it. >> how which marked -- how? >> with restrictions. the center of the global research sector through the 1980's and so forth was in europe. today, the u.s. greatly outweighs europe area -- your. europe. i will also note that finally our market-based system creates to use dollars where they are valuable. overseas, they have price

controls over brand medicines and they suppress r&d and their use. at the same time, they pay about twice as much for generics. instead of rewarding an ovation with medical advances, they suppress innovation and they pay twice as much for generics. generics are about artie 30% of spending of medicine in the u.s. if we push down on medicines -- talks aboutnders issues facing veterans and the almost 90,000 claim act log at the veteran administrations. newsmakers at 10:00 a.m. on c- span. in his weekly radio address,

president obama talks about memorial day. the republican address was delivered in oklahoma. he talked about tornado recovery efforts. this week ibody. have been speaking about america's national security. our , and future. i allied the future against terrorism. -- i outlined the future against terrorism. i went to annapolis. will notrs and marines only lead the fight but will lead our country for decades to come. all monday am a we celebrate memorial day. it is the start of summer. a time for us to spend time with family and friends and barbecue and get some fun and relaxation before going back to work. it is a day in which we set aside some time on her own or with our family to honor and

remember all the men and women who have given their lives in service to this country we love. they are heroes. each and every one. they gave america the most precious thing they had -- devotion. he cuts they did, we are who we we -- because they did -- are who we are today. at a time when only one percent of the american people baird the burden of our defense, the service of our men in uniform is not always readily impact -- a parent. they are so skilled at what they do and because they tend to do so quietly. o not seek the limelight. they risk their lives and many give their lives for something larger than themselves or any of us. the ideal of liberty and justice that make america a beacon of hope.

that has been truth throughout our history. to ourr earliest days 9/11 generation which continues to serve and sacrifice today. every time a threat has risen, americans have risen to meet it. because of that courage and willingness to fight and die, america endorse. that is the purpose of amir -- a memorial day. gratitude for the countless men and women who have given your lives so we can live in freedom. we must do more than remember. we must care for the loved ones of our fallen service members. we must make sure all of our veterans have all the benefits they deserve. we want to be there for the military families who loved ones are in harms way. above all, we must make sure that the men and women of the armed forces have the support to complete their mission at

home and abroad. the young men and women i met at the naval academy this week know the meaning of service. and study the hubris of our history. they have chosen to follow in their footsteps. at decided to lead a platoon. they are doing their part. each of us must do our part. his weekend as we commemorate memorial day, hold all of our fallen heroes in your heart. let's work together to preserve what their sacrifice is achieved to make our country even stronger and more free. that is our mission. it is our obligation. as those whovilege came before us. thanks. , i am the senator from oklahoma. let me start off by telling those who loved lost was in the tornado, we love you.

we continue to pray for you. we pray for you every day. i have been in communication thatthe fema officials the direct needs of those affected on the ground are being met. oklahoma has been hit hard, but we are not knocked down. 14 years ago, and airily similar tornado hit the same area of moore, oklahoma. the images from earlier this week are nothing new. oklahoma will persevere and overcome this tragedy as we have demonstrated in the past. after the oklahoma city bombing, we all remember that, people saw the many ways the oklahomans took care of each other from running toward the bombing instead of running away and to

donate their blood, time oma and money. this display became known as the oklahoma standard. after each disaster that people of oklahoma ace, the standard is exhibited. in the aftermath of the tornado, we are witnesses to the oklahoma standard. that counts of two elementary schools that were wiped out have struck a chord with all americans area -- americans. it was the last day of school for most of the students. you know how excited they get area with the storm tore through the town leaving little in its path. we are beginning to hear about the selfless acts that oklahomans demonstrated to ensure the safety and protection of their fellow neighbors and friends and students. keptond grade teacher praying with her students and

reminded them how much she loved them as she and the students took cover. susanna haley was a first grade teacher who suffered a severe injury. part of the school desk was impaled in the back of her leg while protecting her students in her classroom. the most heart wrenching testimony i have heard is from the person who is responsible for matching the missing kids with the missing parents. that individuals who lived through the storms are volunteering in the recovery and assistant efforts. they are america's real heroes. i have seen people from all comers of the states to to the devastated areas and give their time and money and energy to meet the guy your needs of those injured or displaced. ofahoma has survived an act

terror in 1995 and devastating natural disasters in the past. this most recent storm will only embolden the standard and encourage the rest of the country to follow our lead area -- lead. our victims need your help. they need your money. please visitle, the american red cross website at redcross.com. of oklahomafor all today when i thank you for your thoughts and prayers as we begin the recovery process. oklahoma is grieving and in pain. the devastation such as this tends to bring us closer together as a country. i thank you for listening. god bless those who are suffering today in the united states of america. >> the c-span crew is in oklahoma to show some of the

damage and response i officials. by officials.

>> i just got here this morning. they started at one location.

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[no audio] >> president obama will travel to oklahoma tomorrow to see response and recovery efforts firsthand. he will visit with families affected by the tornado. we'll have coverage of the visit here on c-span. on the next washington journal, politics correspondent alexis amending or reviews political news. robert levinson looks at spending