tv Capitol Hill Hearings CSPAN May 30, 2013 10:00pm-1:01am EDT
10:00 pm
make it happen or the lack of electronics that will keep us in good shape, then we are getting away from the real question. we need to pay attention to these children and constantly synthesizing and how best to do that. that speaks to a lot of parents who are now very unwilling or even fearful of putting limits on any of these things. and i say, well, what does your child do if he's not doing his homework? he spends about phi hours on the internet or with his friends, he's got 200 friends. i don't think he's ever met any of them or talked to them really but he's got 200 of them, whatever they are. you would think this that would be a no brainer in terms of your response to that parent. and yet, many of us, the children have decided the limits. i'm not finished yet. i've only been on for an hour. they get bent out of shape
10:01 pm
because they're literally addicted to that, or they're addicted to the television. and i think that we can teach our kids from the beginning, here are the elements. and it can start as a 3-year-old. montessori school, i'm surprised, hopefully that's not a montessori policy, all over mont sore re, i would think he mont sore rewould be the first ones to say, how do we teach the kids to utilize that and use that in an efficient and effective way and then how do we teach them to use other things as well? so i think one of the big things we're going to be ending up teaching this generation is how to balance our lives. and it's really a metaphor. balancing our lives with electronics, versus the weas of learning we had before, only a metaphor for balancing our lives in so many other things as we grow up.
10:02 pm
>> i'd like to offer some thoughts on that question. i was sanguine in my last two answers about technology, it's new things, that's great, but there are also reasons for concern, as have always been the case with new technology. when presenting came out, the catholic church was concerned, and they were right to be, because the protestant reformation detieror ated the power of the catholic church. there's always things to be worried about. but today the things to be worried about, i think, is how people form intimate bonds. i think smart phones are incredibly addictive. we are addicted. my wife is always trying to pry me away from my iphone because it is so end lessless fascinating -- endlessly fascinating. there's always another story to read, another emale, at "new
10:03 pm
york times" thing. it's compelling. so you just stare at your iphone. there are a number of bobbings that have accumulated some data that this is changing the way we form intimate relationships. nge of sherry turkle's book, "alone together," she talks about psychological profiles of children over the last 20 years, examining the way they form friendship, the number of friendships, the way they interact and she sees a declean in the quality of relationships, which is well worth worrying about. so this is something that i talk about in my own writing. imagine this high tech future, all these really -- all this realy cool stuff, the problem was that that would be even more addictive than the iphones we have now. it raises the possibility of a
10:04 pm
future where people live in synthesized worlds and sit alone in their own rooms having virtual relationships and nothing else. i think we really do have to be concerned about a future like that. i was thinking about this when i was writing the book. one thing i stated was, i took meditation workshops. weekend workshops where you go away to a resort in northern california which is where this was happening, and do exercises with other participants like, sit down, face to face and lock someone in the eyes for 60 seconds. that's actually really hard to do. it's valuable to me to have that coined of practice in encountering the other. i was trying to juxtapose a high tech, low touch future, with a high touch, low tech future and trying to say, it is possible to forge a world where wen have both technology and the intimatity -- intimacy of human
10:05 pm
communication together. it is not impossible to imagine a future in which these things an happen. [applause] >> i would add only a rhetorical question to that, and that is, can an iphone or -- excuse me. or a smart phone build word pictures in the mind of a listener? or are the pictures already shown you so you are forced to see the images that are built rather than to manufacture them yourself. which would you prefer? one is fast, the other takes a little skill. >> thank you. next question, please. >> thank you. do you think -- because i've heard reports that a lot of young people, this is, there's
10:06 pm
more suicides. do you think too much technology might be -- hoith be one of the problems to that? >> the we was, you know, being -- there's a supposed rise in suicides in young people, you know, do you think technology lays a role in this trend? >> i was just saying that there's a kind of clinical or practical aspect, answer to that question, or discussion of that question. but i'm very interested in knowing about mike's philosophical take on it in general as well. when you hear of a high profile suicide, they been in the context of someone being
10:07 pm
cyberbullied, i think is the term now, where the essential herbal -- social interactions within something like facebook and the like, are so out there and open that what used to occur , back biting in the halls of our schools among children or among high schoolers or middle schoolers, that remane there is, so that it was more of a rumor thing, very painful and destructive even then, but now it takes on the role in terms of the facebook type of socialization where any time nyone feels something, it just splatters, not to another person about the ore person but -- or not to that person directly. but it splatters to the hundred people that happen to be stopping in on somebody's facebook, plus, i dwess, the hundreds of friends of those friends. and the whole idea is, is that
10:08 pm
people -- one of my professors used to tell me when we were coming out with power point slides and i was able to make slides and put together a presentation very quickly and he said, you know, the bad thing about power point is that you take your ideas and you can have a very interesting and very beautiful looking presentation, but it allows you to be very premature and perhaps not even have thought about what you're going to say because you can co-it so quickly and ease he. we used to have to craft the slides and have to do our notes and you know -- a lot of research. he said, i'd rather you not add to the noise out there. do this again and think about it. and i was -- i was very insulted and hurt. but i think the lesson i learned was that he could tell that i had not really thought this through. even if it was an error or
10:09 pm
whatever, at least he wanted something that reflected some careful thinking about what i was going to say. on the internet, the problem with that is that there's so much -- i made a note here, of premature -- how many of us have sent an email in response to a message immediately and then we did it so quickly, that it literally did not necessarily reflect and perhaps done damage because we can't take it back. and the same thing even a hundred fold son social media in terms of the things that people say. when you think of the number of -- or put on photos. think of the implications of putting a photo out in public, i mean, we have parents that cringe at somebody else having a photo of their kid if they don't know who it is, think of millions of people having access to that and not being able to
10:10 pm
take that back. if anything, i think that from a clinical perspective in terms of increase in suicides, i wondered, how can you be cyberbullied? it's one thing to be on a playground and have somebody bigger than you are beat you up, i understand that, but i can't quite understand how you'd be cyberbullied because you don't have to listen to that, you just turn it off. how can somebody cyberbully you to the point of suicide. the way that happens, after i thought about it, is the humiliation and anything -- even if it's not true. there's no way to take that back. and now enstead of being humiliated to yourself and to your fantasy about who else knows about this or who else has heard this, you don't have to fantsoys, you know thousands of people out there have seen this. and that is one of the tox exthings i see in the social media the way it's organized now and the tox exthing about being
10:11 pm
able to speak your piece on mail and on that media, immediately before you've even had a chance to think about it and the destruction possibilities are very real. >> thank you. >> i have a followup on that same point, google is coming out with -- fwoogle is coming out with their new google tpwhrass, life with subtitelts as they imagine it, with your camera and recorder on and we already have the memory capability now that not only a goog -- not only google takes a picture but google records my every weaking moment and everything i see. i'm wondering if we as people are going to put up with any time we step out on the street, every action, every word we say in peculiar, may be recorded for all time, may not ever get looked up but now every gaffe, every stupid thing you to, is now recorded and i'm wondering what your thoughs are, if we're
10:12 pm
going to be able to put up with that? >> thanks. the question related to the new fwoogle tpwhrasses product, and what your thoughts are on the ramifications of a product of that nature. >> well, i'm fascinated by google tpwhrasses. i can't wait to get a crack at it myself. i think it's a thought experiment, you can't imagine the uses to which it will be put. the practical experience i have for this is that, i interviewed a guy who has been using a version of google glasses for many, many years. he built himself a rig where he's got these glasses that he can see a projected computer screen hanging in front of him in space. he has a keyboard in his pocket he can take notes on any conversation and then look up those notes when he meets that person 10 or 15 years later and
10:13 pm
pick up the conversation where it left off. so i think that kind of technology which gives you that incredibly instant access, you remember, ave to it's going to have positive effects and negative ones. i think one of the potentially negative ones is that kind of distraction. so this guy is kind of hyper. when i was talking to him, i just knew that he was reading stuff off the screen that only he could see while talking to me at the same time. so he had kind of a permanent case of adhd that's entirely technologically mediated. a deaf ther hand, person, that could be useful, i would love to see live, accurate captions of what people say in noisy rooms. i think the way things like tra
10:14 pm
gone naturally speaking, the way that works, it's not impossible. when somebody asks a question that i can't entirely peck up, i'd love to see something like that. i think it would be great in the way individuals and groups can collaborate to give're people access to your information, to create new kinds of teamwork that today would seem magical to us. it's really, as with any technology, there's dangers and benefits at the same time. google tpwhrasses, i'm pited about the benefits and really interested to see what the dangers are. >> i wanted to touch on one point that isn't specifically along the google tpwhrasses but along the idea of children, adolescents, who are not aware of the implications of what they put on, in terms of photos or maybe keeping track of min-to-minute what they're
10:15 pm
toning with their -- minute-to-minute what they're doing with their lives and now i suppose everybody has had this experience, when you go in for an interview for a job, you've been googled. i had an attorney we were going to do business with at home and i set it up and so i was talking to the lady at the desk, she was an assistant, and she said, oh, hello, i said i'm going to send the information you need. she said, i've already got it. i said, what have you got? well, i've got your address and everything and where you're working, that kind of stuff. i looked at some of the things you've written, very interesting. i began getting kind of chilled. i was just trying to think, what else have i put on the internet? and when i think of some of the kids who very playfully because they could do this playfully before, put up crazy pictures of themselveses or share that with a friend, what happens when the 12-year-old texts something or
10:16 pm
puts an increept -- but puts a picture they western they had never done and the person applies for a certain school or pplies for any kind of job and revels in the indiscretions they've had at a certain point. that's the toxic, scary things i think of in terms of recording every event and having it for he peculiar. >> on the subject of scary and hopeful, is there any use of the technology being used to partially rewire, partially help the children you find that have problems? it seems like some of the things that -- some of the problems children have are a wiring thin in their brain almost. is there anything being done that's hopeful? >> the extent to which neurorow transmitters and pathways are
10:17 pm
getting -- become more crystallized in ters of the assessment tools that are used, in terms of the use of glucose in the brain, lights up certain pathways which is just incredible. it hopes -- opens up whole new ways of thinking about brain disorders. and certainly the idea, i don't know if it was you that mentioned brain mapping earlier, but somebody did, but that whole idea lends itself very much to the use of technology in terms of the way we're changing the effect on the receptors in certain pathways, we do that with medications right now and a lot of times it's extremely helpful, almost scary how helpful it is to take someone in the midst of a bipolar man exrage, an episode, and it's not a matter of calming them down, putting them to sleep or drugging them out, it's a matter of the mother the next day says i've got my child back. t just totally, it's gone.
10:18 pm
and so the extent to which the represent re-septemberors are affected by neurotransmitter replacements is a very real phenomenon. the idea that technologically we may be do a parallel to what's been described by mike, in materials of ideal odgic and other devices, the vista is wide open but wru to the talking to an expert, i'm talking philosophically, as i say, anything that has buttons on it, i'm not supposed to be close to. >> context, microphones, is my mike snon let's talk about context. there was a study that asked how many neurons is it possible to track, between 1960 and now. he went through literature and
10:19 pm
found out the number of neurons that can be individually watched in the brain is doubling about every seven years. that's an obvious analogy to moore's law. in stevenson's law, the number of trackable neurons doubles about every seven year. it's hard to track now -- it's possible to track between 60 and 200 neurons simultaneously in the brean. but even -- but every seven years if that number doubles, by 2040, 2050, it may be eable to track thousands or tens of thousands of neurons in the brain and have a much richer understanding of what gos on in the brain in devastating disorders like par kenson's epilepsy and others and be ablv.
10:20 pm
give a warm welcome to our panelists. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2013] >> coming up a look at the potential effect of the health care law on insurance premiums. and the c.e.o. of america's natural gas alliance on natural gas export opportunities. and another chance to see our discussion on the deficit, the economy, and science research. coming up on "washington journal," scott paul of the more than aleeps for manufacturing on the state of manufacturing and job creation in the u.s. thullingfrut ever -- then federal regulatory commission chairman jon wellinghoff. then a look at the trends of school violence, crimes and safe the. planty, are my call
10:21 pm
and nirvi shah. washington journal live every morning at 7:00 eastern. >> when you first arrived four years ago, i'm sure you never imagined that at the end of that time, there would be a lady behind a podium talking to you in a funny accent. this accent has been the bane of my existence until in 19 0 i moved to new york from england and met henry kissinger and he said to me, don't ever worry about your accent. in american public life you can never underestimate the advantages of complete and total incomp rehenceability. >> this weekend, more stories and advice for a new graduating class with commencement speeches from government officials friday neeth at 8:00 eastern, f.b.i. director robert mueller, fed chairman ben bernanke, maryland governor martin o'malley,
10:22 pm
florida governor rick scott, attorney general eric holder and newtown, connecticut, selectman patricia llodr. c.e.o.'s.y, apple co-founder steve wozz knee yak. arianna huffington. and former president bill clinton. >> the group center forward released a study on the health care law's potential impact on insurance premiums in sex states. next, a discussion of that report with former congressional budget office director douglas stafin and earl pomeroy. this is an hour and 10 minutes. >> good morning. i'm bud cramer, former member of congress, chame of the board of center forward. we welcome you to our program this morning.
10:23 pm
as i hope you know, center forward as existed now for three years, we're all about discussions, we're all about across the aisle conversations in this hyper partisan atmosphere we have up on the highlight here. we think it's important for an organization like center forward to bring panel discussions together over issues that are currently very important to the american public, very important to those policymakers on the hill as well system of we view our role as aiding and assisting and providing information and today is about providing information as well. we bring together in other, smaller programs, we bring together members of congress from both sides of the aisle, beth sides of the hill, we bring together staff we invite associations, not for profits, corporations, union representatives as well to come in with topical conversations. our stake holders support us and we appreciate that support.
10:24 pm
this has been a die nam exeffort on our part, those of us that left the hill and moved downtown are eager to see that centrist conversations occur this this particularly difficult atmosphere. so today is about education. we pvide educational lambs for the general public as well. as i made reference a few seconds ago work elike to produce information. today's issue is health care. center forward has come together with milliman incorporated to produce a study looking a how certain aspects of the affordable care act will affect health care premiums for americans going forward and already there's a lot of demagoguery, a lot of information out there, slants on that information about the affordable care act and health care premiums as well. we will see today a presentation. jim o'connor is here to lead that presentation he flew in
10:25 pm
from chicago to lead the presentation this morning and then essentially we will have a reaction to jim's presentation as well by our other panelists. is i want to make you awear of who is participating in this pral. at the end of the program, there will be time for questions from the audience and we'll make sure we fwrd our time to a certain extent to make sure that that happens. but the first panelist is jim o'connor, to my immediate left. let's warmly welcome jim and doug and earl pomeroy as well to our program this morning. jim is a principal and consulting actuary with milliman he has considerable experience consulting in the individual health and small group insurance markets and has been very involved in assessing the potential impact of health care reform and the various provisions of the affordable care act. so it's very relevant to the conversation this morning. he has provided insight with -- insight with regard to the implement eags of the affordable
10:26 pm
care act, to the national association of insurance commissioners, the and the society of actuaries among others. briefly, before jim presents, we have doug holtz' kin with us this morning. doug currently serves as president of the american action forum, having previously served as the chief economist of the president's council of economic advisors. he was the sixth director of the nonpartisan congressional budget office and also served as director of domestic and economic policy of john mccain's effort to be president. doug, welcome to this program this morning. then we have earl pomeroy joining us, earl, a former member of congress, currently serves as senior counsel at austin and bird, brings 26 years of regulatory and legislative experience to today's panel. proof perfect that we continue to learn information that we don't know as well as i know this nine-term former member, i did not know he served as north
10:27 pm
dakota insurance commissioner and he was president of the national association of insurance commissioners. so earl, a welcome presence here this morning. jim i'm going to turn the presentation over to you now. im o'connor. >> thanks. the affordable care act, of course, we've heard a lot about it and what its potential impacts can be and what milliman has done is we, on behalf of center fwrd, they retained us to
10:28 pm
look at six specific states as to what those impacts might be. and the states we looked at were arizona, florida, illinois, new jersey, ohio, and wisconsin. each of those states presents its own type of characterist exs. one of the things when we're talking about change going from regulatory , is environment, the current regulatory environment of each state right now. each of these states varies somewhat in their current regulatory environment. in particular, new jersey, is a -- has regulations different than the other five states that i mentioned. in that many of the reforms that e being required through the
10:29 pm
a.c.a., the affordable care act, are already in effect in states like new jersey. that's one reason we chose a state like that, to see a state that's already passed the underwriting regulations compared to those that have not yet passed those. and there's significant differences certainly in what e'll see as impacts. our analysis included looking at the men mum ben fete coverage, essential benefits required under the a.c.a. step levels of member cost shares or the actual values you may here. premium rating restrictions regarding age, gender, the fact
10:30 pm
that you're no longer going to be able to rate by health status and some other insured characterist exs and the fact that coverage is now going to be guaranteed issue that obviously is going to be a big impact in those states that currently llow medical underwriting, and federal subsidies. so what's the impact? the insurers come out with their premiums but we have federal subs des provide for people who have household incomes urn 400 pk of the federal poverty level level -- level. we look at that as well.
10:31 pm
that's what people will feel, the after tax effects and there are costs passed through inner it is of premiums. those are key driving forces that will affect premiums. we concentrated mainly on the vedge market because it's most affected by the changes. at the same time, the individual market today represents about 5% of the population. we expect that to grow considerably other the next several years because of a.c.a. we think it will double. so there's a lot of focus on the individual marks for those reasons, number one, it is most
10:32 pm
affected by a.c.a., and number two, it's expected to grow the fastest as well. we also looked at the small group market. i'll have some comments on the small group market as well in terms of how it gets affected. and while the effect is not on arch as great as we might think it -- we might think for the individual market, there are certainly effects on small employers. and i'll have some comments on that. so, if we're talking about the individual market, the key observations we made is that certainly the -- certainly before a.c.a., other than new jersey, these states allowed medical underwriting, as i mentioned, they allowed carriers to varier that premium rates based on the risk characterist exs of the applicants who were
10:33 pm
coming to them. so they did vary their rates based on health status, they varied their rates based on age and gender, geographic location, those things. with a.c.a., we're no longer going to be able to vary rates by health status or gender and our age rating will be compressed. so instead of having premium tes where the rate for a 64-year-old is five times as great as the rate of a 25-year-old, a.c.a. compresses that to 3-1, so they can't be more than 3-1. and actually, in the individual market, because carriers are able to rate for health status and some other things, that 5-1 actually can be -- actually gets ex-panned quite a bit because of the premium add ons for poor
10:34 pm
health status. o we can actually see a much greater than 5-1 in today's market and that's all going to be compressed to 3-. so that really affects a lot of people. and we illustrate that in our report as to what those effects are. as i mentioned, those effects depend on the characteristics of each person. so that certainly is one of the findings that we el strait in the report. the other thing that is evident is that the participants in the individual market, because they're paying all the premium out of their pockets, they're not getting any kind of help fromer that employer, they tend to choose lower cost policies
10:35 pm
that have much higher cost sharing. so a.c.a. has a new requirement that that cost sharing, the percentage of benefits that the health plan has to pay have to be at least 60%. in today's individual market, in a lot of states, the average is less than 60%. so what's going to have to ispen is that the person who today insured with a policy of less than 60%, say they're at 50%, are going to have to upgrade their coverage. so they're going to have to move to that 50% level to that 60 -- at least that 60% level and that's going to go twet -- ogoing to get reflecked in their premiums as well. they will bear the costs of getting those extra benefits. they do get extra ben fis with
10:36 pm
that but of course it's going to cost them more. they will see that in their -- in their preemyulls come 2014. those people who already have plans that are above the of% level, they're not going to be affected by that part. so they won't see that piece of the increase that will be coming through. so what we've done in our studies here is we've looked at two sample plans in 2013. are looked to see what popular plans that are being sold and from those plans, we chose two plans in each state. one of those plans was a popular plan that had an actuarial value less than 60% and the other plan was a plan that had an -- had a value greater than 60%. because we wanted to impact the -- illustrate the impact of just that factor itself. is when you look at the details
10:37 pm
of our presentation, you'll see that obviously the total rate changes for those who have plans greater 60% value are than those who already have a plan with -- that pays more than 60%. so new jersey was different. because new jersey passed a lot of these requirements such as guaranteed issue in the vedge -- the uch as unisex, individual market, such as unisex, the changes in new jersey are far less than what we see in other states. new jersey also has standardized plans that are required in the individual market. that also reduces somewhat the tissue the actual value impact in that state. so we see in new jersey that
10:38 pm
will people can certainly get reductions in their rates. subsidies. the so the tissue the thing in new jersey is they have two different types of standardized plans. one they call basic and essential, one they call stan card plans. the base exand essential are a little bit less regulated plans, less rich plans, those plans will get more impact in new jersey than the standard plans. even in new jersey we see people depending on where they are and what plans they have today, get impacted differently than people who have the richer standard plans. some of the rating characterist exs, some of the rating provisions are different too for those basic and standard plans and that gets reflected in those
10:39 pm
new jersey rates. finally, we look at the federal tax credits. those are the premium subsidies. ose premium subsidies can be people who cant for call fi for them. people with household income under 400% of poverty will qualify for them. for a family of four, a household income of about $95,000. so people below that threshold, a family of four, are going to qualify for some consideration for premium subsidy. now, some of the things that we have noted, though, with the premium subsidies is while they can be very, very generous to people at the lowest levels of
10:40 pm
income and in fact they're so generous that for people -- because premium subsidies are beased on what's called the silver plan, that's a plan with a a 70% act twarle -- actuarial value, if someone chooses to purchase what's cowled a bronze plan, a plan with 60%, the minimum, some of those people can actually get their coverage for zero premium after subsidy. spectrum of full where the premium changes are going to be after subsidy, all the way down to zero for a bronze plan for some people and then for people above 400% of poverty, they get no subsidy relief and so they will see the brunt of the other changes that we've studied and are in our
10:41 pm
eport. there are also some people, younger people, who after subsidy qualify for very little subsidy as it turns out out -- out because of the way the subsity formula is, it's bested on household income. whether you're 27 or 57, you're t the same household income, for the same size family, you're going to get the same subsidy. well because premiums are much higher for older people than younger people, some of those younger people, their premium rates are actually less than at tissue less than what the threshold for their subsidy. so they end up not getting a subsidy. that tends to happen somewhere above the 300% of poverty.
10:42 pm
so it varies by age in terms of who gets the subsidy. it's not quite just the 400% level. that's when we start looking at but in effect it's, for younger people, in a lot of situations, it's 00 or -- 300% or more that don't get subsidies. those are some things we looked at, the key findings we have, basically in the five states other than wisconsin, before subsidies, the changes that we're seeing are going to be somewhere in the area of 15%, up to 60% on average. so those are pretty wide range of potential changes and certainly very high increases. now i need to note, when we're talking about these inveeses -- increase, we did the study just looking at the impact of a.c.a.
10:43 pm
on premium rates. in addition to these, there's also the normal type changes that happen due to the annual increase of costs -- of cost of care. what we actuaries refer to as trend. so in addition to these, you should consider that trend will also be added to these and trend -- varies state by state, plan by plan, but it ranges typically somewhere from 5% to 9% that we're expecting for next year. so those will be some additional impacts that people will feel as well. now, one of the things that we did in our study is we looked at 2014 plans, so the 2014 plans we modeled, we assumed that those plans would have the same type
10:44 pm
managed er network and care features as the plan that people were coming from. what is happening in the 2014 market, in order to keep rates as low as possible, health plans are introducing new plans that ave alternative provider networks. you may have heard the term narrow network plans. will umber of plans introduce alternative plans with these narrow networks which can drive down costs because they're able to negotiate lower rates with providers if those providers want to be in this narrow network. and i think we've seen that that's been the case in rates that were released by california last week. that a lot of those plans are
10:45 pm
narrow network plans and have been able to support lower premiums than what we otherwise would have expected. so our study, though, did not want to look at what effect that might have, and that effect might be a 10% or 15% lower rate than might otherwise be affected. so that kind of counters for people who opt for those types trend , counters the increase i just mentioned, maybe a little bit more than that. so we see increases on average between 15% and 60% in these states, new jersey, on the other hand, we see that their average is going to be somewhere between minus 25% and 0%. and that's where the tissue for the sample plans we looked at. there could be other results certainly, there's a myriad of
10:46 pm
current plans out there that ill affect people. now, of those pieces, a good chunk of that is due to the fact that people will need to upgrade their benefits to that 60% level. so in our report, we give an indication of what that would be and it tends to be in the 10% to 25% range of that 15% to 60%. and then finally we also look at the subsidies again and as i mentioned, they can be anywhere from 0% to 100%. so the subsidies can vary quite a bit. hat i encourage you to do is read the reports, the reports are out on the center forward website, but don't just read the report. read the appendices.
10:47 pm
it's in the appendices where the real detail is. in that appendix, we look at the effect both before and after subsidy, based on sample ages, so we look at ages 27, 37, 47, 57, 62, for males and females, we look at different health status levels, so people who are very healthy all the way to people who are quite sick. who are getting large rateups right now on their premium rates. and we look at different income levels. s bied on all those come by faces, you can see in our appendices how those rate changes might be expected to come out for a person at a given situation with their characterist exs. that's where the real value, i think, of the study is, is it gives you that kind of detail that you can get a good sense of
10:48 pm
that, it's true that there are winners and losers and -- in this, and that kind of illustrates who those people may be in terms of who is going to pay more, who is going to pay less than what their current premiums might be. inally, i want to talk about the small group market. in the small group market, we see that, you know, most states, there will be increases. one of the things that most rates a i lou is to vary for small group based on its composite health status. that's going awaif. so we took a look at what the distribution of those rateups is in each of these states and based on that, we're able to
10:49 pm
take a look at what impact that has, and that was our key focus in the small group market, what impact just that one single change is going to have. it averaged somewhere around 6% to 12% for most tissue for each of the states. and what's real key, though, is that that's just an average. whoif we look at, you know, the -- what percent of fwroups are going to have increases for that, versus what percent are going to have decreases, we see that typically, somewhere from 70% to 80% of the groups will get some kind of increase for that. and those encreases will vary, the averages in our -- and the increases will vary, the averages in our study tend to be
10:50 pm
between 10% and 25%. again, new jersey had the least increase of all of those. included in those increases is the addition of the taxes and fees that are also going to impact those. and they tend to be around % to 5%. -- 3% to 5%. and then the -- another percentage of the small groups is going to see decreases. and those decreases tend to be somewhere in the range of 10% to 15%. actually, one of them, ohio, is in excess of 15%. it's less than 20%. so small groups will also see differences based on their characteristics. what we didn't factor into our study for small group, though, is small groups will also be affected by the age changes and the unisex requirements of
10:51 pm
a.c.a. because, you know, an employer group can differ in its makeup in terms of its age and gender, we realy couldn't look at that in too much detail, but certainly, groups that are made of younger, healthy males, will tend to have higher rate increases than those groups that are unhealthy or are comprised mainly of older people. so the age-gender impact also plays a role here too. so those are our main findings and with that, i think we're ready to open our discussion. >> jim, thank you. >> thank you, jim. we are ready to again our panel discussion and doug, we'll start with you. if you're comfortable there, absolutely. first of all, thanks to bud
10:52 pm
forward nter organization. i've worked with jim in the past, i have a lot of regard for his efforts, i worked with earl when he was on the budget committee and i still live in terror of him. i love this work. and there are a number of reasons. with it accords everyone's intuition about what some of the features the affordable care act has to produce. if you put in the age rating bands and tighten those and say you can't charge higher premiums to the older paired to the younger, without question you expect to see increases among the young and relative decreases among the old. this comes through in this analysis and it ought to have a differential impact depending on whether you had those regulations in place. given that we have had so much speculation about how the
10:53 pm
affordable care act will play out, it's nice to see a study that cements everyone's intuition about the pattern of increases and the level of increases that are likely to prevail. the second reason i love this work, of course, is that it gets the sameances that our work got. what could be better? in january, the american action forum put out a survey which was a survey of insurers and asked them actually a very similar question. not identical, but we asked them questions leek if you have a 27-year-old healthy male in chicago, illinois, and this is the policy they have right now and we add these age wands and guaranteed issues and the variety of other regulatory restrictions that are placed on insurers in the plan, what happens to the premium and we got anns that looked very much like the appendix that jim recommends you read. there will be very different impacts depending on who you are in the affordable care act.
10:54 pm
averages are not going to tell the story. the young and healthy will see beg increase, in some cases, our survey says 200%, their number for illinois is 197%, very close. these are sharp premium increases. and for others, they'll get relative the creases as a result of the regulatory framework. so there's -- you just don't want to rely on an average. there isn't a single number that's going to tell you the story about the a.c.a. implementation. some people are going to get quite a bit of impact and others a lot less. that's important and raises a couple of wild cards that i think deserve some further work. we did a second survey, which we put out more recently last week, that surveyed young americans, 18 to 40-year-old americans who have insurance. and we actually took the time to find out their monthly premium and as a result turn into dollars what happens if their premiums go up 10%, %, 30%,
10:55 pm
which based on all the work that's been done, including today's, are not crazy possibilities under the a.c.a. and the answers are quite striking. in a group that basically looks at the law and says, i like some of it, i don't leek parts of it, it's not an act of political or partisan calculation, it's a consumer pricing decision, they look at what happens to the cost of a product and there's a certain price point, they just say, we're done. if you look 10%, it goes from 100% of the people having coverage down to 8 %, they lose 17% they pay the penalty. raise the payment 20%, it drops to 65% who retain coverage and 0%, it's down to 55%. those are quite striking results about the price responsiveness of the young folks who are important parts of the pools that are going to be on the
10:56 pm
state-based exchanges. and that leads me to a final point, which is, this is going to depend a lot on money. the way you solve that problem is easy. you throw money at it. either by having subsidies, and this raises the importance of the subsidies jim talked about, you have subsidies for those young people so their net subsidy premium doesn't go up 10%, 20%, or 30%, they get a smaller increase and continue to purchase and stay in the pools, that's one way to solve the problem, or if they choose to exit and we are left with much more expensive pool, the preshurns -- the reinsurance provisions and other ways of insuring are going to become important. how that plays out is something i don't know the answer to and i think merits a lot more consideration. it's at the heart of having this be an effective, functioning expansion in insurance for americans. last piece i want to emphasize
10:57 pm
is something that i'm glad jim mentioned. which is, there's a big difference often lost in the public debate between health insurance coverage and health care. and the choices and care that people actually receive. and we are seeing this innovation called the tight network where care choices are going to be far more limited and where the care people receive will be affected by these coverage regulations that have been imposed by the a.c.a. that's the second thing that we don't really know yet how it will play out but i think it's very important and merits watching as other states sort of go through the process of taking up the insurers' filings for coverage that's going to be available on exchanges. what's the nature of that and how much of it is broad and open networks and how much is tight networks and what are the restrictions on care options people will face in order to keep the coverage prices at
10:58 pm
reasonable levels? but you know, the short version here is, i want to applaud both the work that got done, enge it's exactly the right kind of work we need, the fact that we're having an event today to talk about it and to encourage everyone that one of the key takeaways is there isn't a single answer. this sadly, will be a nuanced public policy issue and it has been my sad experience that nuance is not easily conveyed in the public debate so get ready to be disappointed. thank you. >> thank you so much. earl? >> thank you. i'm very pleased to be on this panel. jim has produced a very interesting body of work here for milliman, and it should be commendle -- commended for the level of detail that get into showing the nuances in terms of the picture. doug, someone i've known and respected for at least 15 years, someone that has been very
10:59 pm
engaged in the political debate in town while keeping his intellectual integrity intact, which is no small trick system of doug, congratulations on that, it's good to be with you this morning. i have an interesting perspective on all of this from my background as insurance commissioner and member of congress as the bill was built, ultimately voted for the bill, a good reason why i'm in private sector today is that vote. so i'm finding the debate on rate increases right now to be about as vacuous, partisan and disappointing as much othe debate about the whole darn bill. you've got the republican side at's scouring every rate filing b if there's an uptick, they say, rates shock, the bill is a failure, democrats conversely looking for where the rates are not impacted too
11:00 pm
severely, and they'll propound that as absolute proof that you can expand coverage to those who now can't get coverage, you can limit rating surcharge to those there is no consequence whatsoever. obvious either side is just continuing the melodrama approach and it's important we understand in context by the situation will for some involve some great -- rate increases but what are the trade-off policy benefit that a been achieved? when i was insurance commissioner, 1985-1992, the last period of serious efforts by the insurance industry to contain medical costs in order to keep premiums affordable. in the end, the inexhaustible increases in medical costs won the day and the business of
11:01 pm
health insurance changed. it became much more the business of identifying risk in either excluding it from the pool or sore charging it -- or surcharging it. there were a number rating schemes we addressed as regulators, trying to keep that from getting entirely out of bounds. as a business practice, segmenting out high risk it's a legitimate approach from a business standpoint. as a social stall -- as a social policy standpoint, however, you might think this is not an acceptable foundation for health insurance for america and the 21st century. the affordable care act tries to address that at its core. it basically says if you have been excluded from coverage because of a health condition, we will assure rating rules that
11:02 pm
keep you out are changed and you're now now able to access coverage. if you have been surcharged to an unacceptable degree, defined in the statute, 3 to 1 for example, you will not be charged over that amount. in the event that the cost consequences of this are too grave, you can come into the insurance exchange to buy your individual coverage and there will be premium subsidies in order to be affordable. it is a hugely complicated piece of work. with an awful lot of decisions taken from the marketplace and defend as a matter of social policy. level of coverage is that jim mentioned, for example. the way coverages are marketed. the loss ratios imposed upon insurance companies, all very
11:03 pm
severely limited. what we're seeing underway of and insurance companies companies is the most competent rating challenge i've ever seen. because it involves the great unknown. new systems, new market structure. and behavior responses from the population of the impossible to predict. so i think the political debate about whether or not the rates will be ruinous, whether there should be no great consequence, there is a disservice to the difficult time the market is in getting coverages extended for next year. the way i like to think of it is we're shifting gears. moving from a system that has excluded risk or surcharged it
11:04 pm
to a system that ask fans of cross subsidy the very nature what insurance is. it's a cost subsidy. cost subsidy and we shift to where there's greater coverage certainty. and worst of coverage available. and we subsidize those who are at the moderate end of the rage school -- of the range scale. jim mentions $96,000. i think a lot about the premium subsidy on this part. the portions of the health insurance marketplace, most giving way under the old system. the changes are most dramatic in the system.
11:05 pm
the $64,000 question that waldman to determine rates and these new individual health insurance exchanges. from people what health conditions that have excluded coverage, they will sign up. they understand acutely the financial risk to their family of not having coverage to pay the medical bills they're much more likely to be incurring. people have been self insuring the risk that they don't have [indiscernible] now they're going to have subsidies of making that coverage available. will they respond, will they
11:06 pm
respond, will they understand how this all works and is extremely competent at bill and mark politics again is weighing in on this one. we have taken efforts of voter suppression and we moved to efforts that an moment suppression. we have not funded information, getting information out to let people know who may be subsidy eligible. secondly, we have health and human services reduced to shaking the 10 cup, panhandling for contributions trying to raise privately money. been accused -- being accused of something like the iran-contra
11:07 pm
type violation. this is about trying to discourage the contributor in adverse. we don't want people to know about these exchanges because we don't want them in the pool. that on the one hand has been an unfortunate aspect of what we're seeing relative to the potential to get as many lives in the pool of possible. and you need allies in the the pool to keep premiums down. my ding on the other side, i think the democrats have to be real. it will be rating consequences when you expand coverage and guarantee access and narrow
11:08 pm
premium surcharging. you might say at least you're getting more for it. one facet of this relates to no improvement in the policy at all. this is insurance fees and taxes newly created under the bill. this happened in the senate. [laughter] you can't do that them -- do. them. who pays them? the people paying the premiums here that cost is passed on them priced out in the cost of coverage. that's a premium driver that
11:09 pm
does not tend to be anything in enhance coverage. jim ends up by saying winners and losers. we see that turns on who, where, how old, how much. some states that have made this shift already, not that much impact. how old. obviously if you're a younger, you lose this rating then limitations. if older, you win under the limitation. finally i do not think of as winners and losers. i don't think we have except what health insurance system.
11:10 pm
if you need the coverage it did nothing to respond to those who cannot not afford coverage at all. that was a system where in a way, we were all losers. we are in the middle of a difficult under a very complicated re-do but i think you'll end up with a stronger health insurance system as a result. thank you. >> before we go to the audits for some question and reaction, anything you want to further discuss our react to bought up in the panel discussion? >> certainly the point they both made a very valid. i think the --one of the keys that we need to understand is that i mentioned that rates are different in different states right now. earl mentioned where you live as being the --being important. you look at a state like new
11:11 pm
jersey or new york where a lot of these reforms have already been put in place, we look at their premiums today. they are quite a bit higher than the premiums and these other states we looked at that have not passed those reforms. a good indication as to what direction we think premiums for the indigo market -- for the individual market will lose overtime as the new requirements get put in place. we do need to be cognizant of all of that. as i've mentioned, everybody gets affected differently. i encourage you to look at that type of detail not just averages. that's really where it's important. >> thank you. now if he could have questions
11:12 pm
on the audience during bear with us here. we will need to get a microphone to you. and for you to state who you are and who you represent here. >> peter barnes with fox business -- i haven't had a chance to read the full report but can you tell us how and why you selected these six states? i assume you have looked at all 50 states and selected these based on some criteria. to give us an idea about the geographic impact, calmly states would you say are like new jersey and new york and massachusetts and already have a lot of these reforms in place and thus their residents might not see large increases? how many states are on the other side without as many reforms? >> we selected the states largely due to several critersia criteria.
11:13 pm
we were getting data from certain carriers and so the states where they were operating is where we can get good data. the second criteria was we wanted a mix of states where the regulatory environments for somewhat different. new jersey obviously stood out as one with more restrictive regulatory environment. arizona and ohio -- they had a far less regulatory requirement than other states. states like illinois and florida were somewhere in between. most of the states in the middle tend to be more similar to those that are least restrictive than
11:14 pm
those with most restrictive. they do allow for rating variation as well as medical underwriting and the ability to decline. in terms of the numbers of states, pretty much the ratio that we have in our study is the same as what we would see if you look at all states. the states that have passed these, maybe five i would put into that bucket. the least restrictive and the middle restrictive, the other 40-45 states are falling into that category. within that middle, there is a spectrum asked where regulation
11:15 pm
is. it makes a difference as to the regulatory environment not only for the individual market was deposited on but small-group market. some states that are more liberal in the individual market are not necessarily all that liberal in small-group market. that makes the difference to in terms of choices employers will make going forward because today they may have made some choice based on the current regulatory environment. tomorrow when the regulatory environments are basically the same across the nation, those choices may be different that those employees will make. [inaudible] >> with a be fair to assume that about five of the states will not see significant increases on their healthcare
11:16 pm
reform and 45 will see bigger increases, everything else being equal? >> i think that is a fair statement. certainly not only will those five or six states not see increases, quite possible that quite a few of their members will actually see decreases in their rates provided that the inflow of new members are healthy. so we gotta get that healthy flow of new members to bring down the average health status and risk pool. right now in the states, because there isn't a mandate, a lot of the healthy people choose to stay out of the markets and the because the premium rates in those markets are a lot higher than they are and the other
11:17 pm
markets. so you definitely need the inflow of new healthy lives as well as those life that -- lives that we expect to get who are certainly less healthy. we need the proper mix of risk. >> one thing in context is -- as you look at most people in their coverage, they are coverage are large employer group. we are talking about the smaller portion of the market is short in the individual market. >> i work for a representative. as a clarifying question from something you said about who responded to the study. i wanted to confirm the states that are studied here that the
11:18 pm
companies covered the ballistic comprehensive. are there companies that did not respond question mark -- did not respond? >> no. we solicited information from the blue cross and national carriers for these states. we do not look to every carrier in the state. >> tony pugh. you mentioned an estimated five percent of the insured market is in the individual market. i wanted to find out what percentage is covered to the small-group market directof the fix -- direct market. of the five or six states, you mentioned new jersey, what about
11:19 pm
the other three or four question mark -- or four? and the availability of the catastrophic coverage that typically have lower premiums, is that not a viable option for the young, healthy people that will face the entire premiums? >> the other states awe're -- we're talking about would be new jersey, new york, massachusetts, vermont. we might consider maine, washington, oregon. those last states less so than the first several i mentioned. your second question? i don't have those numbers with
11:20 pm
me but that would roughly be about 12% of the population. and that's through, when we talk about small groups, companies with 50 or fewer employees. >> the catastrophic coverage? >> the catastrophic coverage, plan will be out there for young people were people who find other coverage unaffordable. to purchase at a lower cost. so there is some viability to that plan. i don't think it's the title plan that we be attracted to everybody who qualifies but certainly having that plan does
11:21 pm
give another choice the people. >> on the small-group, a group of 25 and fewer, there is a tax credit in support of the premium to 50% for the first two years of coverage. that's kind of bait and switch. the rationale behind it is you rearrange your pricing in your cost structure so that you work your way into employer coverage for those small employers on 25 and under. so that's a significant tax credit not mentioned in jim's report. >> is that a relatively small
11:22 pm
slice of the total market that would be affected by this law? >> most people will not directly feel the impact of aca immediately. because most people are employed by large employers who are not subject to the minimum actual. they are subject to a minimum value of 60%. they're not sensitive these rating requirements. they won't feel a type of impact we are talking about for the other 20% or so. they will feel impact because the large employers are going to
11:23 pm
be subject to these new taxes and fees. then we'll see some of -- they will see some of the premiums passed on to them in the way a premium. so i think that's right. in majority of the population is not going to be impacted as greatly as the people in the small-group and individual markets will be. >> i think it's important -- it's important is beyond the proportion of people in it. here's why --to the extent that employers change their coverage, they will get into a tighter reg the tory web. second, anyone who is on the arithmetic recognizes that for any employee of to about 300% of the poverty line, it is clear
11:24 pm
that the employer and employee have a shared interest to stop providing insurance, give the employee a raise, let them pay taxes on it, take the subsidies and buy coverage that is as good or better than what they had before. the employer can give them a raise -- they can't even pay the penalty, i had your the only big losers the taxpayer. -- ahead. the only big loser is the taxpayer. will they remain a niche commodity or will to be the case of large-scale entry by people in the market. if it's as large as the arithmetic suggest, the majority of insured products we conveyed to the exchanges in america's future. how this plays out is very important. out of proportion to exactly the
11:25 pm
initial startup. we know the bad risks will show up. there are high risk pools in every state. those people will be hand as quarter to these exchanges, i promise you. they will be there. -- they will be hand escorted to these exchanges, i promise you. they will be there. if they are not subsidized, they will say goodbye. of these are very expensive pool that leaves a very expensive pool deck goes into potentially a death problem. -- pool that goes into potentially a death problem. they could show up and if they do, the exchanges survive for later the employers to enter into this.
11:26 pm
the ultimate outcome of this is highly unclear. it will differ across pages and incomes and health status but the implications are enormous and the future of american health insurance. its importance is not best measured by the fraction of people currently in the small groups or in the middle markets. this is a very big deal. ask -- >> i think what doug has for expressed -- has expressed, most employer groups will hold. the tax incentives remain. the importance of health insurance as part of your employment relationship -- the importance of insurance given those going to work at their place of employment is paramount. it's a key recruiting tool.
11:27 pm
everything about employer health insurance continues. on the other hand, these exchanges, this is a marketplace idea. when we were in congress considering the clinton health insurance forms -- reforms, it is a marketplace based concept. there's a lot to be concerned about in terms of whether they will work perfectly or not under the affordable care act. i wish we were at a point in our political discourse for the parties were collaborating in terms of how to make this marketplace where consumers can compare apples to apples and get better deals for their covers. -- for their coverage.
11:28 pm
>> can i have one -- add one question? we agree on a lot of things. one of the key features will be doesn't work? when you flick the switch on october 1 for assignment -- for sign up and generate first actual operation, will it work? what are they show up and the subsidies don't show up? there are lots of start up risks associated with this vision. even if you agree on the notion of an exchanges and after concept. the next year is going to be an interesting period of science for the insurance industry.
11:29 pm
>> in 2016, the definition small-group expands to 100 employees. that increases the percentage of people who are going to be affected by this. we will see a resurgence of some of these questions and issues of that market expands. >> one last question from the audience. i don't see a hand. is it possible considering the detail that have to be discussed and where we are right now to give general advice to those folks listing -- listening saying how do i avoid a large increase in my insurance premium? >> is think -- i think some
11:30 pm
people are not going to be able to avoid it whatsoever. depending on the characteristics. but the insurers are putting out plans that will at least provide some relief in terms of the premium rates that will be charged based on what i mentioned earlier through plan design, network design, more managed care. things like that that will help keep down costs. those are the options for people who otherwise would be getting even larger increases than what they'll get from opting for those plans. >> the industry --presented an array of options that will give choice to people. sometimes the regulatory calls on whether the ideas would be acceptable or not in a new
11:31 pm
environment have been turned down. i think it's a time when we should have flexibility and choice. we are making a very important market shift. so i would encourage the administration to have an open mind about alternatives and flexibility, especially in the early going of the affordable care act. >> i think it's really important and the reality will be at the level of the states for a lot of these decisions to be made. some states are opting for an active purchasing approach where they go out and decide in a military fashion what kind of policies will be available. the latter would be preferable in an environment where there will have to be a lot of people response to the reality of the regulatory shift, the reality of the tax and fee shift. that's all unavoidable.
11:32 pm
so you have to maneuver within that. >> thank you all. on behalf of senator -- center forward, i have to end the program now. i want to thank the board and the holders -- and stakeholders, the staff. thank you. terrific presentation this morning. this is a perfect example of how we try to offer timely information to the general public. a general public that is awfully cynical about what's going on here in washington. maybe now the insurance is viewed with more favorability then the house and senate right now but it is still a world out there that will have to go through a lot of sorting through. becky for coming. -- thank you for coming. [captioning performed by
11:33 pm
national captioning institute] [captions copyright national >>ble satellite corp. 2013] coming up, the discussion about the deficit and science research. a look at a potential effect of the health care law on insurance premiums. the state of manufacturing and job creation in the u.s. grade than a federal relic story commission chairman discusses the regulation of electricity natural gas and oil markets. later, a look at the latest trends in school crime, violence and safety. our guests are michael plenty of the bureau of justice statistics and nirvi shah. live every morning at 7:00 eastern on c-span.
11:34 pm
the annual report detailing the health of social security and medicare is been release. treasury secretary jack lew and health and human secretary well lead an event examining the report. you can see it live starting at 11:00 on c-span. when the attorney general arraigned me in california after the extradition, he indicated that he wanted the death penalty each of the three charges. he wanted the death penalty three times. that made me realize serious they were. it made me realize that it wasn't about me. i could be killed three times. it was about the construction of this imaginary enemy, and i was the embodiment of that enemy. >> she was not that interested in talking about what happened. the crime, the implications.
11:35 pm
she was not interested in talking about it. she is one of these people you do not go to directly. i was trying to get to her directly. i figured out that there were very important people in her life, and i chipped away at the people she knew and trusted. . was able to get points let them see my previous work. slowly, she came around. she agreed to meet me. --automaker show a lynch >> now the ceo of america's natural gas alliance. he's got lucky opportunities for natural gas. this is 25 minutes.
11:36 pm
ours a pleasure to have speaker with us today. martin durbin. it is the president and ceo of the national gas alliance. he is the new anger management. if things get too stressful, just remember. it's a movie thing. we are very much appreciating him being here with us. he is into his tenure, 29 days into the first 100 days on the job. we're all very proud. as many of you know, he joined , where he served as executive vice president of government affairs before his work at api him he served as
11:37 pm
vice president of federal relations at the american chemistry council. he also worked for the american council pressure the merger. he is a maryland guy. earlier in history, served as a legislative assistant for senator alan dixon and for congressman rick boucher. please welcome me -- these join me in welcoming -- please join me in welcoming him. >> i appreciate you invitation to be here. i am taking suggestions. , i have tot started impress my colleagues back at the office by tweeting while i'm making a presentation. done. if you want to follow me, it is
11:38 pm
@martyjdurbin. i've had a few opportunities to get out and speak. i was on a panel with different fuel sources, and it was an interesting format. you had five minutes, 20 slides, and they had to advance every 15 seconds. i'm than to take more time today. i've instituted that my weekly staff meetings. it has helped a lot. , and what we are about. let me first at back and say that from its beginning it has always been about trying to promote greater utilization of natural gas. because of the economic benefits that it brings, and the better energy future that we are
11:39 pm
going to be a part of. just flipping through some of themajor points to raise, public debate on energy as we have seen in the last several years, quite a lot is going on. the american public is sometimes uncertain about what their energy future is. in our view, the benefits of opportunitiesd has help bring clarity to that discussion. , we havely for me launched a new ad campaign to help get our message out read i hope some of the have seen it. it is called think about it. it is focused on getting the american public to think about our energy sources. think about where it comes from. it is often confusing when you hear all the debate about whether we should be using this type of fuel, or that type of
11:40 pm
energy. often the debate turns into an order to have more of this, we need to us of that. the bottom line is, there's no question we need a fuel diversity in this country. it is a good thing when we have competition among sources. we certainly have that now right natural gas is a very good position to pay -- play a positive role going for. natural gas is abundant. i'm not telling you anything that people don't know. the clerk and citizens that we have more than 100 years of natural gas to serve us here in the country. it is affordable. these are third-party sources that are coming out saying we expect expect to see stable prices for natural gas or 20 years or more. when abundant abundant, affordable, clean. the carbon emissions at the lowest levels in more than 20 years.
11:41 pm
we're not just about greenhouse gases. you look at the power sector and talk about the the reductions they have seen over that timeframe. again, the benefits are for all of us. importantly it is ours. it is a domestic resource. we know that in 2011, 35% of the natural gas that we were reducing was coming out of the shell around the country. is projected to be higher in 2040. estimates in two years time increased by 26%. we're looking at a time when we were looking at the potential of having to import natural gas. now we are clearly in a position to be able to exporting natural gas to our allies.
11:42 pm
while there are those that say that natural gas is a bridge, i would say that is one heck of a long bridge. the fact of the matter is that reality is that today and for the future, natural gas is a foundation feel. it is providing us the opportunities, and will be for a long time to come, for this abundant, affordable, clean, and domestic resource will bring economic and elemental benefits. what are those opportunities? clearly the power generation is one of the biggest areas where we can see even greater benefits from natural gas. that is happening. we're seeing that. the good news is that there is a lot of competition in the power generation sector right now. the market is helping us determine where the existing utilities, what types of fuel they are using pray that is good. as healthy for the economy.
11:43 pm
-- that is help the - that is help the -- that is healthy for the economy. great opportunity and capacity for being able to grow our utilization and power generation. then you look at the industrial site. we are leading the march year to greater manufacturing use and utilization in the industrial section. the chemical industry, the steel industry, you're saying facilities both new and expanded. the chemical industry is looking at 97 new projects that are out
11:44 pm
there. great opportunities for building jobs here in the u.s.. it doesn't end there. fertilizer.teel, general manufacturing. we could have one million new jobs in manufacturing based on natural gas shell development. this is a game changer. the renaissance, the rebirth of the rust belt. the opportunities we have to really bring back the economy. we are really starting to see it. a lot more is coming. provides greatat opportunity is in transportation. i hope some of your singer television ads. we focus on the fact that los angeles has 100% of their transit buses compressed of
11:45 pm
natural gas. they reduce emissions by 80%. as one city. 2500 buses. we are seeing that around the country. systems areansit just one of those opportunities. we're seeing more fleets looking at opportunities for natural gas. i think there are great opportunities here in segments like rail, marine, earth moving equipment. even the equipment that our industry uses when they're producing natural gas. great opportunities in the transportation sector as well. of course there are exports. another great opportunity that we have got to provide markets for. to continue to divide certainty and the incentives for producers to keep producing. i think that this is a great
11:46 pm
opportunity, and it is a good start. we have seen more and more reports come out within the last couple of weeks that the bipartisan policy center added their own voice to the others that said we can do this. we can export some of our natural gas without harming the economy, without -- by providing benefits and helping our balance of trade, helping the president meet his goals of doubling exports in the u.s. i think it is one of the things you have to think about. clearly the president has. even as recently as yesterday, two different events in chicago, he did say it was great news that we would soon be able to export some of our natural gas. i agree with him completely. we like to see a faster pace on the approvals, but another great opportunity on the export side.
11:47 pm
on safety, this is one of those where we of course have industry committed to producing energy resources safely and responsibly. we do that now. we work closely with state regulators and federal regulators. it is unfortunate some believe this is a wild west out there where there are no rules in place for producing oil and natural gas. we have got no end of regulations already in place at the federal level, and at the state level. our member companies have the fact is, it was innovative technology that brought us of the opportunity and natural gas production, now allowed us to recall -- a recall of these benefits.
11:48 pm
continue to improve, continue to be more efficient and safer as we go along the way. as how this industry works. you'll continue to learn as we go along. this is a well-regulated industry. we will continue to work closely with the regulatory is -- regulators. i've already mentioned in several contexts, huge job creator. we're seeing thousands of jobs, tens of thousands of jobs being created across the country. they good paying jobs. these are jobs that you come into with opportunities to move up within the industry. nothing but opportunity there. -- we are seeing benefits to the consumer cost. heating bill,ur consumersill,
11:49 pm
receiving -- saving $1000 a year. .he lower-cost natural gas our mission is to be getting that message out there. this is a great opportunity from employment, for the economy, for -- all of these things will divide benefits across the economy. to helpr role demonstrate very clearly to the public and policymakers that this is real. it is not a saying this. we have third parties that are verifying the fact that the resources are there. we are not going to be seeing
11:50 pm
spikes in prices into the future. we are seeing the impact as far andhe reduce emissions, clear source of fuel out there. want to be part of this revolution. we are part of it now. we will continue to be a part of this revolution. power, industrial, and i look forward to working with a lot of you to make that happen. with that, i would be happy to take questions. [applause] if there are any? or suggestions. >> [inaudible]
11:51 pm
we should be out -- adding value here. they have an advantage over the rest of the world. >> is a a false choice. we can do both. because of the abundance and affordability, we can produce enough to provide the benefit to the manufacturer. especially the chemical sector. and still be able to export some of those two allies. the other important factor is the number of facilities built, the amount of gas exported, the market is going to help control that. it is news to anyone every facility has been built. there is fierce competition internationally for its. this opportunity to make sure
11:52 pm
the nice it is piece of the market going forward. our view is we can do that while the same time providing both the amount and the abundant, stable supplies to the manufacturing industry in the u.s.. >> a follow-up? >> in order for your vision to hold, we need to have the supply match the demand. i am thing about how do we make sure that the supply is there? the chemical side. how do you see the hydraulic fracking debate playing out? [inaudible] >> i think the debate is one
11:53 pm
that -- i think the debate is going to be with us for a long time. we have to separate out the legitimate concerns and questions that are on the table from the amenities we are operating, and from broader environmental organizations. to separate those out from those who simply do not want any production of natural gas. i wouldear on that, tell you, i was heartened at the senate energy committee roundtable discussion they had over the last month. the utilization, the final session we had last week on shale development. the discussion was not about should be doing it, how may regulations do we need, it came out and said -- we have this system in place, are there ways we can improve it.
11:54 pm
we have confusion out there about water contamination. is it coming from the process itself? good question to have on the table. let's answer that. we have good answers for all of that. .e got into issues of flaring a lot of confusion and misunderstanding what is actually happening. art of is incumbent on us and working with others to clarify the record. that is the discussion is taking place. not should we be doing in the first place. the president saying it is good news that we will be exporting natural gas and a few it -- a few years. while the debate is not going to go away, i'm very confident we have got the answers. we have the ability to work at the local level with the state regulators. that is incumbent on the individual companies. i think they are doing a better job all the time of being right in there with the communities and saying here's what we are going to do. it comes down to real local
11:55 pm
concerns and local issues. we get to those issues, and now air in a better position to make sure there are not obstacles in our way to achieve the benefits. >> hello. you have expressed confidence in the regulatory system. do you see any need for nor additional regulatory structures question mark -- structures? >> frankly, the process is very well regulated at the state level. that is the right place for it. it is the oil and natural gas development process that is regulated at the state level. they have the expertise and are able to take into account the local conditions. theres not to say that
11:56 pm
seems to be a general sense that there is no federal regulation of this. i know several in the audience and take off regulations that apply to our operations. it is not that nobody is watching. i do think that alan move forward -- as removal part, to demonstrate that programs like we provide the -- several states up -- it was a great discussion at the senate energy roundtable. theeneral i would say that process is working really well. let's make sure we are not going to layer things on top of a -- a constructive process moving forward. and realizing all the economic
11:57 pm
and environmental benefits of greater natural gas use. >> a question for you. you talk about the power generation. everyone talks about investing in gas. it is beating out cold. coal. does there come a point where they take that and point the finger at the coal industry thing you should be shutting down? [laughter] that is what everyone is talking about. [applause] [inaudible] >> the answer is no. we're going to need a diverse
11:58 pm
mix here. we have that. it is good news that the competitive market now, the market is helping decide what fuel the generators are using. i do not see any need at all from and natural gas industry .o single out any fuel source we have a great story to tell on our own greed we are a part of the market now. all all we need to stay focused on. what are your members thinking about controlling methane conditions? >> any companies that are involved will tell you they are doing a good job of controlling methane. we had a epa rule last year that help address this further. are outstanding
11:59 pm
studies that haven't come out yet are looking at are there additional issues to be addressed there. or, what the omissions are. but from our industry standpoint, this is an area that is in our interest to capture that methane. that's what they are doing. if we can find ways -- if there are issues, this is an innovative issue. -- innovative industry. you mention climate change earlier. , one of theask benefits of natural gas. what is the policy driving the natural gas push? or do you think is along for the ride? i do not see a need for
12:00 am
separate current policy to continue the move we have already seen. givearket itself -- innovative technology developments that have allowed us to have this resource available to us. he market has said this is the right field to use. because of that, we have now seen reductions in carbon emissions and many other emissions that did require any overriding any overriding policy at the federal level. i would almost want to say let's not mess it up. let's keep it rolling. any last questions question mark -- questions? suggestion box? thanks. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2013] >> we appreciate you being here. we will provide you with our
12:01 am
the gasgift, roundtable gas claim. display probably. -- it proudly. thanks to all of you for being here today. we are adjourned. >> a discussion about the deficit, the economy and science research. the nethercutt the potential effect of the healthcare law on insurance premiums. later, the ceo of america's natural gas alliance on natural gas export opportunities.
12:02 am
,oming up on washington journal got all of the american alliance for manufacturing on the state of manufacturing and job creation in the then federal energy military commission chairman discusses the regulation of electricity, natural gas and oil markets. later, a look at the trends in school crime, violence, and safety. our guests are michael plany and education week. washington journal is live every morning at 7:00 a.m. eastern us he spent -- on c- span. the american enterprise institute holds a discussion friday on the cost of long-term health care. a panel care professionals will examine whether the government should finance long-term care with individual should get coverage to the private marketplace. buy coverage at mine -- 9:15 eastern on c-span two.
12:03 am
>> she makes the first speech by a sitting first lady. becomes the first president of the daughters of the american revolution. designs her own china and establishes the white house china collection. and as the first have a christmas tree in the white house. meet caroline harrison, wife of the 23rd president benjamin harrison as we continue our series on first ladies with your questions and comments. monday night, live at 9:00 eastern on c-span, c-span3, c- span radio and c-span.org. >> next, we will hear from juan enriquez, the founder of the life sciences product at harvard university's business school and ceo of bio -- of i/o tech economy. we will open up phone lines and take some of your tweets. use juan enriquez and we will post some of those. we have also posted a facebook
12:04 am
question that deals with your thoughts the deficit and economy and scientific research funding. should we invest in scientific research funding. in particular, if you have questions for him, you can include those as well. a couple postings already. one from jeffrey who says -- is theid murphy, what point? ingres does not understand what that is. does not understand what that is. more of that in about half an hour along with their phone calls and tweets. from earlier this month, juan enriquez look at the peterson fiscal summit and looked at the impact the growing deficit and debt is having crowded investments into scientific research. we will show you his comments and then hear from you. ♪
12:05 am
>> good morning. let's go up to the first slide, please. all of you know the story of paul revere. the british are coming and people paid attention and that was a good thing. a modern paul revere looks like this. [laughter] he has been wandering around and saying, hey, folks. the dutch are coming, the dutch are coming. he has been doing that for decades. of course, even though he has been warning about this stuff, nothing happened. usually, impolite capitalist societies -- one of them came out and then there are weeks where decades happen. you can accumulate that until the european union begins to figure out when you promise to
12:06 am
much and your debts get too big and you end up with taxes that look like 75%. if you think about what the life of a minister in the european union looks like and what it looks like every month, over the past several years, this is what they spend their weekends doing. [laughter] you can call this iceland or portugal or spain or italy or greece or cyprus. but basically, the overpromise, you overspend, and you spend your weeks making sure the entire european union does not go off the cliff. those are the consequences if you do not act. those are the consequences if you save for decades, nothing has happened, until it does.
12:07 am
as you are thinking about that, what will happen in the united states, mandatory spending, when the peterson foundation start thinking about stuff like this, relatively minor surgery. you are sitting here basically at 38% of the u.s. federal budget. today, what you are looking at is about 64%. as you look toward the future, the future is beginning to look like this. minor outpatient surgery is becoming critical surgery. if you have a debt problem, you do not exhibit debt by doubling or tripling the debt. let me show you what $1 trillion in $100 bills looks like when it is stacked up. please note the gentleman sitting to the left of the picture is six feet tall. that is about $1 trillion.
12:08 am
here is what has been happening in the u.s. with federal gross debt. you take about 1.3 of these stacks in 1983. you take about 4.4 a decade later. you take about 6.8, and then today, you are sitting at 17.2 of those stacks. by the time you project those forward, by 2040, you are talking about almost two times the gdp of the united aids. you have got to ask yourself, is that sustainable or does it again to look like a fun european weekend? as you go through this stuff, it is really important you start reading documents like this, which are not the usual language
12:09 am
of the federal reserve subsidiary board. they are normally very boring documents and do not have headlines like, deficits, debt, and looming disaster. what i want you to note on this document is that this is an old document from 2009 and was talking about the crisis when the debt was $10 trillion, not when it was $17 trillion four years later. as the system goes forward, let me remind you again, it does not seem like anything happens or interest rates go up, it does not he liked the debt matters, because we have got a lot of disciples of the fictional french economist. the disciples advocate and say, you can have two major wars, and not pay. at the same time, you can give yourselves a major tax cut. at the same time, you can increase benefits for all, and you will have no consequences. when the disciples go through the new machines at airports, the ones that do full image a- day scans, you can always tell the disciples because they look
12:10 am
a little bit like this. [laughter] as you are thinking about this stuff and see signs looking like this, one of the things michael has just said, there is not much difference in the short term projection between the government and think tanks on the left and right. in terms of what happens over the next few years. all of them, left and right, see a way going forward. it is painful. it would have been far less painful five or 10 years ago. this is not pleasant trade-offs. but it is doable. it is doable without the types of crises you have seen in europe here at what is not sustainable is the current policy, which takes us in this direction.
12:11 am
it is better to act now. as you are thinking about what acting might look like, it is a series of compromises and trade- offs. it is not either or. either or is too darn expensive. only cuts, you cut 28% of gdp. only revenue, you have to increase revenue 38% of gdp. by the way, there is a third thing you have got to do. as mandatory spending starts crowding out everything else in the economy, you cannot fund growth because there is no money left to fund education, r&d, and infrastructure. a combination of fun stuff, some increase in revenue, some cuts. it is a moderate compromise in
12:12 am
those three things. i hope it takes these two new paul revere's in a new direction. what i would love to do is take this fiscal summit and a year in two years, three years, in this direction. please get on with it. let's put ourselves out of the business of discussing the fiscal deficit and talk about important things like long-term trends. right now, the fiscal debate is taking all the oxygen out of the room. you are either on this or this side. you have all kinds of fights about stuff, which is reasonable compromises that have not happened. when you do that, what happens is you do not understand the truly important transition taking place because you are focused all day, all the time, just on the deficit. you might be missing the big picture. here is what it looks like. humans are the only species on
12:13 am
earth that transmit data consistently to their kids across time. maybe a dog learns commands and a parent learns words, but there is not an animal on earth that rights on cave walls except a human being. why is it so important to write on cave walls? this is how you have a baby. this is how we cook it. this is how we dress. this is how many of us there are. these are our musical instruments. you learned a whole lot about what is happening in argentina 2000 years ago. as you think about how we
12:14 am
transmit knowledge, that is enough for a try but not an empire. why. here you have to go to a cave to learn what is going on. in empire, on the other hand, looks like this. two things have happened. you standardize the language and put it on paper, so you can transmit data across time and you can learn the lessons of why egypt fell. all of you clearly know you can read that, right? it basically says, cut the deficit. then you standardize language and you put it in 26 letters and it looks like this. you have huge data. in this, you can write sentences that say, cut the deficit. what has happened over the last 30 years is you have collapsed all the languages in ones and zeros. it is the countries that understood the transition because they were not worried about the current problems but look at the future. you understand the rise of silicon valley, taiwan, boston, singapore, india, if that transition right there. the first line of code says, i love you. the second says, i hate you.
12:15 am
the difference between love or hate, green or purple. what have you done? you have collapsed every word written or spoken in england and condensed it into two letters, and chinese, and japanese, every language in the world. and every music, and every photograph, and every video, and every film. that translation in code is what generated most of the big companies you look at. it allows us to write sentences like this. guess what this one said here it cut the deficit. as you are looking at this transition, you can take the world's first trillion operations per second per computer and put this into an intel chip in your computer, which gives a street salesmen in mumbai as much information as the president of the united
12:16 am
states had 20 years ago. take all the satellite images and maps and bios and send them to your smart phone. as you begin to think of those transitions, what is really important to understand is the transition took place really quickly. the world was basically 98% analog in 1996. it is about 96% to juggle today. you blow up xerox and all these enormous businesses. you have built enormous businesses, if you were paying attention to the transition. here are the top 10 fastest- growing u.s. industries for the last decade. you want to understand where jobs are? where growth is? it is countries that spend money on education and infrastructure as codes transition. every single one of those has to deal with the transition of ones and zeros. you are all a very competitive group. let's try the following experiment. see if you can get more answers than your neighbors on this question. for the next 15 seconds, come up
12:17 am
with the five large u.s. companies that did not exist 10 years ago, 20 years ago, or 30 years ago? just think them through. all right. now tell your neighbor how many you came up with and see if they have more or less. all right. for the winners. here is a bonus question. do exactly the same thing with either major european companies that did not exist a decade ago, two decades ago, or three decades ago, and see how many names you come up with.
12:18 am
that one is a little harder. you want to understand why there is 40% unemployment in spain? you want to understand why there is huge debt crises? partly it was because there was no growth, not because there are no smart people. there were no startups. partly because they spent a whole series of mandatory spending items and did not invest in the future. as you think about this stuff, job growth only comes from startups. it is not the fortune 500. it is not the fortune 50 that generate net new jobs. it is the start up economy. people are investing in the future. they got dreams and they invest in the stuff. it is important for education, infrastructure, r&d. let me tell you about the current transition. again, we are transitioning in code. we move from hieroglyphs to
12:19 am
abc's, to ones and zeros, and we are transitioning in dna now. 60 years ago, they began to argue that all life is coded in what they call a double helix. this double helix of dna has four little runs in it. all life is coded in water levels. every human being, every orange, every politician, they are all made of the same stuff. as you are thinking about this stuff, you can write incredibly boring books. you can write trillions of letters of this stuff. why is this important? it means this orange executes code. how does it work? it is simple. it begins to execute code and make a little root. make some leaves. make some oranges.
12:20 am
remember those ones and zeros? i love you, i hate you. it really matters which string you send. same thing with life. orange. this becomes a grapefruit. this becomes a lemon. maybe he becomes a watermelon. you change one out of the letters, you become the person you are sitting next to today. the more careful where you sit next time. as you are thinking of the consequences of this stuff, it turns out life is code. if life is code, we can read it, we can copy it, we can edit it, just as we do with ones and zeros, or words or hieroglyphs. you can go to argentina, they will introduce you to your friend, the cow.
12:21 am
as you are petting the cow, these to show up and you say to yourself, those two look really similar. they do. if you take the cow genome, you can take the genome of every cow and give birth to two clones. this is what cloning looks like. placing a bunch of clone embryos. there are a lot of cows that look really similar. i did not expect to find this in argentina. why are you taking so many pictures?
12:22 am
do you understand? they are all the same. [laughter] stage one, we read the genome. states two, we photocopy it. stage three, we edit it. this is important because we edited the genome. we did not copy -- in such a way this animal produces medicine used to cure cancer in its milk. 20 of these animals substitute for this factory right here. how we make things and where we make things will fundamentally change. those countries did not just focus on things. they invest in the future and r&d and had startups and became the powerful countries on earth. the same thing is happening now
12:23 am
if life code makes its way across the economy. how and where we make things will change in a fundamental way. of course, no red-blooded american would ever want to be treated with a medicine used were created in argentine cloned cows. that is why americans are using goats. these are goats in western massachusetts worth about a million dollars apiece. as the stuff moves forward, this is beginning to move through college campuses. college kids are beginning to ask the question, can these simple biological systems be built and operate within living cells? the answer is yes. what these kids have been doing is building everything you can build in electronics but they have been building it themselves. all the switches, mathematical
12:24 am
compilers, etc., that you have in a computer ship, you can build the cell and you can build it in a robust system. you can copy. you can make this standard. you can build all the things that make a logic circuit on a computer. what are the consequences of being able to do that? five years ago, in a bar across the river, after three scotches, these two guys, sat down and said, would it be cool if we could program cells as you program computer chips? we decide to fund the company, and it helps when you're partner sequenced the genome. it also helps when the guy sitting down one a nobel for enzymes. a mere four years and $32 million later, we are able to take this picture. why is this picture important?
12:25 am
it is the first time you transform one creature into a completely different creature. one species into a different speeches. some people thought was the world's first synthetic life form. the cover of 4800 papers and magazines and the science discovery of the year. this is interesting because there are two big differences between what happened over the last 30 years with digital code and what is about to happen. you can make anything you program the cell to make. to make gasoline, machines, information storage, foods, and we are doing all of that. but the second big difference is, the software makes its own hardware. it does not matter how i program a computer.
12:26 am
i will not have 1000 computers in the morning. if i program cells, they go from one of the test tubes and we go back to our greenhouse in san diego and they look like this. what we are doing is buying a tiny piece of the valley, and here is what our factory will look like. some of those will make energy and some will make textiles and some will store information and some will store other stuff. we will make a transition on how and where we make things. let me tell you about the second big difference. the speed with which this is happening. the cost of sequencing a full human genome dropped in four years. it is a decline factor of 800 times compared to when computing dropped by about four times. this is happening a lot faster. the cost per genome has dropped off the cliff. we cannot build computers fast enough to transmit it. that is one of the reasons amazon is seven percent of the cloud.
12:27 am
everybody is uploading this stuff. companies like ibm, not just the startups, but cambridge, is interested in the stuff. you hear general electric talking about this. life sciences and healthcare four percent of the revenue. that is why you see genomes and proteins and cell discovery. and why dupont is beginning to make all of the stuff not out of petrochemicals but out of cells. they are programmable. they make plastic. by the way, life sciences is 42%
12:28 am
of total earnings. these are big transitions in the economy that are taking place very quickly, not just here but also elsewhere. here is the bottom line. you do not have to invest a lot of money. these startups that start small and become the big companies in the united states, it is .2% of gdp invested through then venture capital. these are 21% of u.s. economic output. you want to address the deficit? start investing in this kind of stuff. understand the transitions. do not cut research budgets for r&d. here is my specifically. can we please get on with it already? can we quit talking about deficits and start talking about the future? you want to keep this country as the greatest power on earth? it is about investing in the future and understanding these transitions. it is about letting kids dream. changing the conversation. at this point, it is a painful operation but it is doable. it will take decades to get it done. in europe, it has become critical and the survival of some countries and the sovereignty is at stake. let's just not reached that point. there are too many other things
12:29 am
to talk about. thank you all very much. [applause] >> next on c-span, joining us live from newton, massachusetts, is juan enriquez, the ceo of biotech. here to your comments and calls about what you just heard, the investments in research and the amounting debt in the u.s.. there are a couple of ways you can participate by phone -- make sure you turn off your television. we will read some of your postings, as well. if you are on twitter, if you just use juan enriquez. thank you for taking your time out this evening to talk about
12:30 am
some of your ideas. to start off, how do you get lawmakers to be the visionaries you need to get to where you want to go with scientific research? >> you have to go back to the origins. there are a lot of people talking about what the founding fathers want to talk about. one of the real magic of the u.s. is a lot of the founding fathers fathers were interested in science and science research and entrepreneurship and building new things. if you think of the stuff that jefferson did and his great
12:31 am
library and architecture and you talk about franklin and his inventions and research, and the other founding fathers, you go back to original principles and follow those. >> you mentioned in other talks i have seen online that the whole talk about the fiscal debate is taking all of the air out of the room. how do you get lawmakers to listen to these ideas? >> part of the tragedy, what is happening, they are taking your and my credit card and charging everything on it. they are saying, we are having a great quarter or a great year. they are basically charging all of that to our kids. what is important to understand is when you spend the day but your kids have to pay later, that is not a tax cut. that is a long-term loan, which may have a very high rate of interest that our kids will have to pay. what you have to think about now is to you invest in science, innovation, infrastructure, or do you invest in paying the current account deficit, which is what we are doing.
12:32 am
>> your primary field is genomics. where do you see it growing in the next 20 or 50 years? >> i think the transitioning happening today in science -- during the korean war, when people worried about a possible nuclear war between the soviet union and the united states, when people worried about transitioning all the soldiers out of world war ii, very few people were paying attention to transitions like these of obscure little nerds inside bell labs inventing the transition the transistor. they ended up being one of the biggest single drivers of the global economy because it led to the internet. the biggest transition is not only in reading and writing in digital code, but the biggest
12:33 am
transition in the world today is the transition into reading and writing life code. that will change every business on this planet. imagine if i were sitting here in the late 1970's and early 1980's, and i told you the single biggest change in the world and in your kids lives, the single against change in the position of relative countries, who is rich and who is poor, is the ability to write in ones and zeros. that would seem like a nerdly and obscure argument. it turns out to be true. 99% of the information we transmit today is in digital code. that is why we do not use vinyl
12:34 am
records. that is why we do not use manual typewriters. that is the reason why we can use the internet. that is the reason why you have wonderful posters out on the internet. your parents never had access to google and wikipedia in school. we are beginning to understand how the code of a virus is written, how the code of a bacterium is written, how the code of the plant is written, how the code of an animal is written, how the code of a human being is written, even how the code of a politician is written. as you begin to think about that stuff, what is interesting and important is very small changes could lead to a big difference. the difference between a chihuahua and a great dane is a single gene out of 20,000 genes. the difference between a tree
12:35 am
that grows at this size and one that grows at a larger size is a few genes. if you think about life at those terms, how long a human being lives, what the quality of our life is, what diseases we die of, how we feed ourselves, what medicines we take, how we clothe ourselves and create energy, all of that will change in a fundamental way as we begin to understand, read, and right life code. >> we have a lot of callers and comments waiting. joining us from newton massachusetts. caller is in new york city. caller: thank you for taking my call. you paint a grand picture of science and the future and its place in humanity. i really appreciate that. i can resonate with a lot of it because i am an engineering
12:36 am
student. you mentioned the importance that spending has, as well. mandatory spending, for example. social security, entitlements, education, etc., and connecting that with science. you mentioned that investments in science and engineering and innovation, they take small amounts of spending. but as to how people, in general, view that sort of spending, the culture of science, and the way people currently see science, how can you bridge the divide that currently exists from what most people think about science, which is not much, and it shows in a lot of international exams, and the digital divide that exists between first world and third world countries. it is extremely large. you may talk about the importance of reading and this
12:37 am
new way to speak, speaking in the language of the life of code, but a lot of people do not have that sort of opportunity in the world. >> i will let you go there and hear the response. thank you for your call. >> so, you know, computers used to be incredibly expensive. having access to a computer used to be a big wheel. people stayed up until 2:00 in the morning to be able to program a few lines of code into the computer. today, everyone has access to a massive supercomputer called cell phones. the amount of data you have access to on your iphone or on your cell phone or on your android phone, is equivalent to what the president of the united states had a couple decades ago.
12:38 am
if you look at all the maps and biographies and information. if the president said, i want all the data on this, you now have that as a fruit salesman in mumbai for a few cents. it has shut down the whole discussion of the digital divide. 10 years ago, we were worried about those who would have access to information and those who did not. basically, the information has become so cheap and ubiquitous and large, wikipedia, google, and this that the other, that there is no longer a talk of a digital divide. what has happened is countries like india and taiwan and singapore, korea, basically now have a standard of living equivalent to that of the united states because they educated their children in the new language, they took education seriously, they took the digital education seriously, and all of a sudden you have all these countries growing at nine at nine percent every single year on a compounded basis. and you get this massive growth.
12:39 am
something similar will happen in life sciences. the rich countries today may be caught by countries that just educate their kids in the stuff. that is why the stuff is so important. that is why the deficit stuff is so important. we are spending a lot of money today on a whole series of mandatory programs. a lot of other countries are spending money on the next generation. they are spending money on education. it is not a lot of money. it is enough to have a growth rate that is different between this country and this country and when you have a growth rate that is three times as large in one country versus another, year after year after year, those countries catch up very quickly. >> for a quick snapshot of where things stand with the deficits and debts, $642 billion is four percent of gdp. the national debt is $6.8 trillion.
12:40 am
caller: i sold the program microsoft word to bill gates in 1980. software is one of the reasons it has gone overseas. i wonder if the wonderful technology you are talking about, that everyone in america should see that talk, i am just wondering if it will bring jobs back from the united states or will further move american jobs offshore. >> the united states is still the most innovative place on the planet. when you look at the entrepreneurship, when you look at the men and women wanting to start new companies, when you look at the research going on in the universities, particularly life sciences, the united states is so far ahead of the rest of the world, the u.s. is to lose.
12:41 am
this is one of the key instruments. what the united states can do that very few other countries can is they can take the energy out of research come out of the universities, out of people like you, and turned it into these enormous companies. the richest state in the union, just to take your particular story, should be new mexico. because that is where microsoft was started. because microsoft moved from albuquerque to seattle, all the sudden, washington state became a huge hub of growth and it has got red hat and amazon and all these companies. it is because it is where people like you choose to live that generates enormous growth, just to repeat one statistic. .2% of the u.s. economy is invested in venture back startups. 11% of u.s. economic output, and
12:42 am
11% of u.s. jobs and 21% of u.s. economic output. it is having 10,000 brains like yours, and what we have to do is not just this cost the deficit and whether it is democrat versus republican, but discuss how we take the 100 smartest people in each high school, the hundred smartest people in each college, and give them an opportunity to build colleges that are 10 times or 100 times the size of microsoft or amazon -- companies that are 10 or 100 times the size of microsoft or intel and make the u.s. remain the economic power it is. by the way, it would be good for the u.s. to have this happen overseas as well. the more the world gets smarter and the more the world gets richer, we take more care of the environment, we consume less resources, we do better as a world, and it does not help us to have more poor countries and more isolated countries.
12:43 am
it does not help us to have more divided democrats or republicans. we have to start talking about how we deal with a very big issues in the world, as to how we restructure the european economy, how we solve crises in medicine so we double human lifespan. those are the challenges our kids and congress should be talking about. >> we go to chicago next on our independent line. caller: good evening. there is quite obviously a huge backlash against a biotechnology and me personally, looking into this more, more transparency is needed, more of a public dialogue. because obviously some of the consequences of biotechnology is controversial, from the human genome roger, and even agriculture.
12:44 am
there was a large demonstration this past weekend against one of the large biotech companies and people are adamantly against the kinds of genetically modified organisms and the supreme court is hearing a case on whether you can patent genes. we could foresee a future where you could have surgeries targeted on specific gene patents. the big question is whether or not this seems like we could be giving god-like powers to scientists. what are your thoughts on that and how safe could this be? with the concept of biotechnology in agriculture, a lot people are worried about inadequate modified organisms and how that creates huge health problems. >> thank you.
12:45 am
we appreciate your call. >> so, look, first, no technology is perfectly safe. the problem with countries starts when countries start to make a reasonable-sounding ledges nation that turns out to be completely unreasonable. parts of europe have adopted the precautionary principle. the precautionary principle says you prove to me this is completely safe and i will approve it. think about that for one second. intellectually, it sounds interesting and attractive because you want what is approved to be safe. but you would not be allowed to build a staircase, and automobile, and electric light socket, if that was the principle applied to technology. unless the biotechnology is the first technology humans have ever invented that is completely 100% guaranteed safe, then you and i know we will make mistakes.
12:46 am
the question is not whether we will make mistakes. the question is what is the alternative and how expensive is it to not apply this? let's talk about agriculture for one second. if you do not have increased products, crops, if you do not use less pesticides, if you do not use less fertilizers, if you make it all organic, part of what will happen is you will take an area the size of the amazon and put it under cultivation to feed the next 2 billion people. either we wipe out all of the rain forest in the world to feed the next 2 billion people, or, we begin to increase the productivity per acre that we. what we have been doing is increasing the productivity of
12:47 am
corn, wheat, reducing the use of pesticides. so far, at least, there has yet to be a case i am aware of where somebody has a serious reaction to a genetically modified organism. which, you cannot say for peanut butter, which you cannot say for a whole series of foods. you do not ask people if they are allergic to genetically modified foods. you ask them if they are allergic to stuff which many of us live with everyday. so far, and this is not a guarantee of what will happen in the future, genetically modified foods, about 70% of the grains we consume today are genetically modified, have been very safe. we still have to be careful. we still have to test the stuff. but it makes a huge difference if you can generate four times as much food per acre as used to generate per acre. it makes a huge difference if you use less test decides. sometime soon, what will happen -- less pesticides. sometime soon, what will happen is you
12:48 am
will start getting food to fight specific diseases. you will have cancer fighting corn. at that point, there will be interesting trade-offs. >> we are talking about the federal debt and how we fund scientific research. 15 more minutes of your calls. on twitter, you can use juan enriquez in your tweet. here is a tweet. >> there is a whole series of ways of building companies. the tax structure is one of the pieces. but the main piece of the whole
12:49 am
thing is really important the government understands what it does and does not do well. the government funds basic research very well. if there is basic research at nih, basic research at nasa, basic research at the national academy of science, basic research at a whole series of organizations, that is fantastic. once the research starts becoming, how do you apply this to business, governments do that very poorly. that is the point where you get investors, venture capitalists, entrepreneurs, and part of the magic of the u.s. is in the places where that bridge works, you get a lot of economic growth. let me give you an example of this.
12:50 am
if you walk around m.i.t., the difference between that area of cambridge 30 years ago and that area today is night and day in terms of buildings, restaurants, art, museums, economic output. the same thing is true in silicon valley. simply because stamford m.i.t. were very good at taking basic science research and translating it into google companies that look like google. you do not want to walk 10 blocks in the university of chicago. there are huge ghettos university has not been able to create jobs and it has not been able to create startups. it has not been able to create a local economy. as a result, you have poor people sitting around the university. that is what happens in a lot of europe. it is hard for some of the european universities to make the bridge between a lot of government funding and the university and the start up business. the magic of the u.s., the power of the u.s., is a continuous
12:51 am
ability to reinvent itself, to generate new jobs, to generate new technologies, to take stuff which did not exist and make it true. a whole lot of the rest of the world follows and also makes itself rich. that is the thing the u.s. will do not just in life sciences at it is doing it right now in robotics, nano tech, the data research. there are so many interesting areas where our kids can work. but it is really important to get our schools right. it is really important to invest not just in the elderly, which is where we are spending most of the money, but to invest in the next generation and the schools and the basic research and infrastructure. >> back to our phone calls. robert, good evening. caller: yes. i appreciate c-span. i tuned into your program a little late. i have been able to figure out biotechnology. my question would be the religious aspect. i recently became a christian.
12:52 am
how do you feel that people realize you are messing with dna, genome projects, and building animals, and it sounds great, cancer fighting milk and everything, but what is your opinion on the religious aspect and how people are afraid we are doing what god does? >> one of the interesting things about religion is religions appear and disappear. most of the religions that humans have generated, most of the gods humans have worshiped across time, have ended up in parts of history museums or art museums or part of archaeological sites.
12:53 am
and that is the reason why you go to a series of races and people used to worship the god of thunder or the god of rain or the god of this and that. religions that tend to survive across time just as species are the religions that adopt and adapt as things change. because there are two visions of how to think about religion. one is, we know, if we are believers, everything that god taught us and intended and we know it from the beginning. and those religions tend to disappear. other religions tend to say, you know, as you get smarter, we adopt and adapt to what is happening. the religions that tend to last across time are those that understand we are taking a small green poisonous berry and cultivating it to the point where it becomes a big, beautiful, heirloom tomato or many different versions of tomatoes.
12:54 am
there are religions that understand we have taken a small grain the size of your thumbnail the size of corn. we have taken moles and turned them into dogs. we have been doing this for a long time. as we breed vegetables, animals, we begin to understand how to modify gene code so we live longer, because we double the lifespan of human beings over the last hundred years, those religions tend to do very well. it is the religions that back knowledge, learning, education, and the religions that are humble to say, i am still learning, that tend to generate both successful worshipers, successful congregations, successful countries across time. that is something the u.s. is
12:55 am
allowed. the u.s. is allowed tolerance. the u.s. is allowed learning. the u.s. is allowed for many different believes to coexist. >> on the extended lifespan of human beings, i heard the talk you did, not the one we showed this evening, but you talked about the human lifespan going up to 120, 130 years. do you think that is possible? how many years down the road do you see that happening? >> again, when our grandparents were around, they were around my age, those who were 65 looked pretty old. when social security was established, the average lifespan was a couple of years. part of the problem would be deficit, retirement deficits, and all this, is because we have increased it to the point where someone dies at 75, they are dying young. it is not unusual to see 80- year-olds. it is not unusual to see 90- year-olds running a marathon. which would have been really hard to conceive of for our
12:56 am
grandparents. what we are doing today is adding about one year of life for every 10 years. every decade, we add about a year. as you do that, it is not inconceivable that our grandchildren will live pretty comfortably and the new 60 will be 100. there will be a point where we are going to reach some really interesting and complicated ethical dilemmas. because we can now ready much know that we can clone our bodies out of any one of ourselves. we have not done that. we should not do that. it is a risky technology. it is highly experimental. until we make it safe, that is not a choice we should face or discuss. but once you make it safe, then there is an interesting question. would you like to have an identical twin that happens to
12:57 am
be 30 years younger or 50 years younger? what would you teach it? would you want it? how would you do that? how would you deal in the world where that became commonplace? if you could have an identical twin that was frozen because you can freeze cells and it was born in 500 years, would you want that to happen? there is a whole big complicated ethical, moral structure that changes with this technology and there will be a healthy, interesting, open debate on this stuff. we are doing some very transformative stuff. between now and 2020, we should be able to tell whether planets that look like earth have life in other places. >> let's get back to our call here.
12:58 am
sorry to interrupt you there. a number of folks standing by want to ask you questions. alabama, next up. alex, go ahead. caller: good afternoon. i really enjoyed the conversation. i would like to make two questions. one thing that is very clear, the democrats, republicans, fight each other. that is the sad part. secondly, most of us know [indiscernible] does not work and does not align us to use the technology of biotech and computer marriages that could tour of the future of
12:59 am
the country. the country four years ago, [indiscernible] the best place was united states. today, i am considered by my grandchildren, i am afraid for them to learn chinese. i am disappointed. i do not know what to do to wake up republicans to tell them we have to not fight each other. nothing but lies and fights. we all know. i know. you know. everyone hearing knows that these guys forget about the country, forgot about my taxes for the salary. it don't matter what i do. >> we will let you go there. going back to the original point, how do you get lawmakers to listen to your ideas and work on the deficit issue and scientific research? >> that is part of the problem we have with deficits. what is happening in europe is they never faced a series of this debate in a series of countries. all of the sudden, the credit
1:00 am
ran out. what ends up happening is nothing happens and nothing happens and nothing happens and then over the course of a weekend, you get the explosion in the bond markets. then you wake up and you have no then you wake up and you have no banks, no credit, you have a system where all, people realize you are broke because you spend more money than you had, not for a month, not for a year, not for a decade, but for several decades. part of what the u.s. is doing right now, which is very healthy, is just recognizing how big the problem can be before we reach a situation like that faced by iceland or ireland or greece or spain or portugal or perhaps italy and france. if we can solve this, if we can get democrats and republicans to say, ok, look, we do not like the increase in revenues, we do not like the cuts in the programs, but we will have to blend these two alongside economic growth.
71 Views
IN COLLECTIONS
CSPAN Television Archive Television Archive News Search ServiceUploaded by TV Archive on