requirements and cost of the u.s. medicare program. later, bill allison of the sunlight foundation discusses congressional fund-raising third plus, your phone call, e-mail, and sweets. "washington journal" is next. ♪ with four days to go before congress leaves washington for the month of august legislative action focused on spending bills and possibly a deal on the student loan rate. here is what we are watching in washington today, a verdict is expected at 1 p.m. eastern in the bradley manning case. and the senate banking committee will talk with bank implementing the dodd frank reform bill. live coverage on c-span three at 10 a.m. we will begin us morning on washington journal of prospects

for peace deal in the middle east. john kerry kicked off talks washington last night with israeli and palestinian negotiators. what is your reaction? democrats, 202-585-3880. -3881.icans, 202-585 585-3882.nce, 202- you can also e-mail us at journal@c-span.org. headline --

we want to get your thoughts on this this morning. middle east talks resuming. the phone numbers are on your screen and you can also send us comments via social media. inside "the washington times" is what is up for discussion. key issues on the table this week in washington. the first is directed at

israeli-palestinian negotiations. that in "the washington times" this morning. also in the papers this morning analysis of the situation. hear from "the new york times" is this headline --

i want to show you what martin index -- martin indyk had to say. [video clip] >> it is my conviction for 40 years that peace is possible. since i experienced the eight -- experience the agony of the war as a student of jerusalem. how one of firsthand your previous sensors, henry kissinger, broke a cease-fire that ended the war and paid -- and paved the way for peace for israel and egypt. because of your confidence that theould be done you took up

challenge when most people thought you were on a mission. you drove the effort with persistence, patience, and creativity. prime minister netanyahu has made the tough decision required to come back to the negotiating table. i am grateful to you and president obama for entrusting me with the mission of helping you take this breakthrough and turn it into a full-fledged israeli-palestinian peace. martin indyk after secretary john kerry announced he would be a special envoy for palestinian israeli negotiations. we are getting your box on that this morning. -- your thoughts on that this morning.

a little bit more about martin indyk -- we told you from "the washington times" what one middle east analyst had to say about the from then for israelis palestinian perspective. here's what the same analyst had to say for the palestinians --

asked monday whether mr. obama might take part directly in the top -- in the talks -- there is no current plan for that. our first caller is from chattanooga, tennessee. caller: the only reason they are meeting right now is because the the unitedple, states is forcing them to. the only reason the palestinian people are coming is because if they don't we will not give them the money they need to keep going. neither side wants to settle. two years ago when i told obama to throw israel under the bus -- when they told obama to

--ow israel under the bus 2002, all of the arab countries offered to give israel peace if .hey go back to the green line they absolutely refused to do it. do not want a piece, they want the united states to protect them. , int in 1967w 1948 they took 54% of palestine and then the rest of it, up to 90%, in the 1967 war. they had no reason to do it at all. you said palestinians are

not interested in peace, why? caller: neither side is interested in a settlement. they both want all the land. host: a democratic caller, hello. caller: good morning. , how canon is this this piece talk go on without the gaza strip? need to behink they part of the negotiations? caller: of course. the neighboring countries of the egypt, syria, and all of the other countries are in the area. back to "the washington

times."

those are the folks were presenting these talks. yesterday martin in, the special envoy for those talks, we will are getting your thoughts -- we are getting your thoughts. riverside, california, at democratic caller, hello, hannah. i think both people in the lands want peace. it is probably going to be impossible as long as there is a string of people who say that israel does not even belong on the map and they exclude israel from the maps.

i do not think that is very helpful. also, israelis will hold a grudge as long as the dome of the rock is possessed by a foreign nation. originally it was king solomon's temple. there is a lot of significance there for the israeli people. i just pray for the peace of israel and all of the other countries over there. >> front page of the washington post has this -- this is what william booth and and guerin right --

we read some of those from the washington times this morning. let us go to many annapolis -- to minneapolis. i have a quick note. i wonder how many viewers know oft palestine is composed two isolated lamps, which both are being surrounded by israel. what are you referring to

specifically? the map of palestine. host: gaza and the west bank? caller: yes, two isolated areas. host: where are you from originally e? caller: yemen. host: why is this important to you? it is a holy place for muslims and i am a muslim. we face that area. jamaal, indianapolis, independent caller. hello. caller: i am a military veteran.

for the life of me i cannot why -- their supposed be a democracy. it is even worse than apartheid was in south africa. of israel iste democracy is not true. the fact of the matter is they are still going to make settlements. that is one of the big things that is not going to make it possible to ever have peace. if the united states would do with the middle east in -- middle east with that evenhanded, the israel is going to get us into something -- needsinctly united states to check israel because they are out of control. host: jamaal, that is your opinion.

what about israelis who say that -- theirthreatened security is threatened. you have checkpoints every five miles, russian out water, they are going to be a degree -- ration out water, they are going to be angry. israel needs security, but that is a red herring. they need to quit messing with the palestinians. palestinian's needs security, too. remember when they would not even let the red cross in? curtis, richmond virginia, democratic caller. caller: i just want to make a comment. it is great to be on c-span. i am just going to make a lenin, hitler,,

the fiercest tyrants of the 20th century. the european eastern jews are imposters. they were put in israel, israel was made for white people from america and eastern people from europe to have the eye on the price, and that is the middle east. that is why the economy is going on, they are brutalizing the palestinians. they are going to keep going on. host: why do you have this opinion? caller: it's the truth. ae european jews were given spot. look at sharon, netanyahu. their white people. not part of the people of that land.

it is historical. darnell from fort wayne, indiana, what is your take on the middle east peace talks? overall, going back to the design before the great depression, we know how the economy took place and it shifted. there areline is still connections between the u.s. and the morocco peace treaty that would make everything mutual -- everything neutral. that was the foundation of the building between the middle east and parts of africa through the u.s.. your we are going to keep

-- keep taking your thoughts on this. secretary john kerry ticking off middle east peace talks. there are the phone numbers on your screen. we will return to your comments in a minute. i want to give you some other news this morning. front page of "the washington times" on immigration -- "the washington post" this morning has a story about the prospect of immigration reform

--

that is by ed o'keefe in the washington post is moaning. , the senate is set to take up the transportation hud spending bill before they leave town.

that is from the washington post. also this morning, the section ," sayinginancial times obama care is helping to reduce the overall cost of healthcare. will be talking about medicare and health care costs coming up on "washington journal." from "the washington times," here is the story --

this is the front page of many thepapers this morning, pope told reporters on a flight yesterday, "who am i to judge a

gay person who seeks goodwell -- seeks goodwill with the lord?" those are some of the headlines this morning in the papers. one quick one, we told you that the verdict for bradley manning is expected today at 1 p.m. eastern time. ofwill see how members congress react to the verdict by the judge in that case. back to our question for all of you. we are getting your take on middle east peace talks resuming. that happens here in washington. secretary of state john kerry has gotten both sides to agree to a nine month timeline. west virginia, a democratic caller. caller: good morning.

i would like to ask viewers to look up the proposals made during the peace treating between prime minister arafat during the clinton administration where arafat turned down 90% of what he wanted during those negotiations, including part of jerusalem. more than was possible to get this time around. they always want land from israel. israel gives that land for peace and then israel gets bombed, so they have to put up a law to protect themselves. the restaurants were being bombed. i think if people took their emotions out of this and just look at the facts, israel did not invade jerusalem during the

1967 war. they were invaded by some of the arab nations. they were just defending their territory. time, that part of their israel was able to continue to protect the land that they were being attacked on. i get frustrated when i hear people say such negative things about israel. they are so oppressive. they allow arabs to bm it can asset, their parliament. it would be a wise thing is the palestinians would if up their , because itto hamas is a terrorist group. so is has the law, backed by iran. -- so is heads the law hezbollah.

ofo pray for the peace jerusalem as the bible instructs me to do so. will be ablet they to help each other out. from new york, an independent caller. i referred to to reference. in 1980, it was the first time territory -- are you hearing me? host: we are listening. caller: from -- the nile had become an area of peace.

my second thought, [indiscernible] every understand that for occupiedeans that the nation accepts this goal. realities are changed. at that time,t h the jewish 500,000.n was only tell me why this happens again and again. host: linda is up next. caller: i think these peace

talks are primarily a raced of time. -- a waste of time. forgotten.ght is the israelis have engaged in being bullies. they have done things, the soldiers in kids schools. the people in gaza are also entrenched in their beliefs on how things should be. the wall does not help. i lived in a place where i felt my security was threatened. i did not have the u.s. in my back pocket. i would move. likeld move if i felt

every day everybody hated me in the whole region. i think that is maybe the real solution. from sterling heights, michigan, a democratic caller. what do you think? i think it is a waste of time. a frienddyk was never of the palestinians. he is a declared zionist. host: we told you the president were of doing a to economic speeches last week. he was in illinois. tennessee at be in an amazon.com fulfillment facility. this broken reuters this morning.

his goal, to be outlined in the speech is to break a gridlock and find a formula that satisfies oath republicans and democrats. senior administration officials say obama is not giving up on a big deficit cutting package, but given that no agreement appears in the horizon so far, he is offering a new idea to try to follow through on a 2012 reelection campaign promises to help the middle class. thatll be country inc. speech. look for when that will air on our website. -- covering that speech. look for when that will air on our website. the headline is --

those are some of the things you can hear from the president today when he talks about the economy in chattanooga. back to our discussion. middle east talks resume. what are the prospects for peace? john in north carolina, republican caller. i love c-span. a longtime listener. i think there are two very important books on the subject. is "palestine peace, not

apartheid," by jimmy carter. it gives you a real feel of what is going on over there. and the other is "the israeli army." those two books and read them you will understand what is going on over there. i think helen thomas, if you what she said in public, i think you would agree with what she is talking about, she made a comment that cost her her job for you -- her job. it was maybe 2009 or 2002 she made a comment about what is going on with the palestinians and it cost her her job. a democratic caller from brooklyn. help me with your name.

caller: alec andra. -- alejandro. i am responding to the woman who calls from west virginia. understands how palestinians are treated in palestine, she would understand. palestinians are treated horribly. israel was built as a settlement. a lot of palestinians lived outside of the country itself in refugee camps in the countries surrounding palestine. the arabs in israel are not even treated equally. peace talks are just useless. john kerry himself is just a stooge. why do you say that? --ler: what you go host:

what? host: that he is a stooge of aipac. a times atspeaks their conferences. host: that makes him in their pocket? caller: the lobby is very powerful. and sadly the lobby does not even represent the interests of all jewish people nor israel. the interest of the likud party in israel. an independent caller in new york, go ahead. i just wanted to comment that if israel continued to the palestinian land there is always going to be conflict. these peace talks did not make

any sense. do you think that if there was a two state solution where the land was divided, whether it is the 1967 borders or something else, do you think that would work? if israelis stop around the palestinians -- that is the only thing that is going to help this. two different states. let us say the u.s. occupy canadian land, what do you think

would happen? the canadians would not like it. host: huron twitter is a tweet from a viewer -- -- here on twitter is a tweet from a viewer -- courtesy of the museum here in washington -- that is section four here on "the washington journal."

here is this picture from the white house yesterday. president obama met privately with secretary of state hillary clinton. here is a picture of their just today outside. this piece goes on to say -- that in "the new york post." and her lunch at

the white house, two pieces this .orning at the first one about whether or not she will run for in 2016 -- below that is the story in "the new york times" about the launch president obama had with the former secretary of state. it says here --

.liot spitzer writes this , pledgings teamed up -- let me go to arthur in cleveland, mississippi. what is on your mind this morning about talks resuming? believe god gave that land to israel. that is their land. the united states has no people what tog do with their own land to know more than israel can tell the united states what do with their land.

they fought in wars. that land belongs to them. took lambs from mexicans in the war. we took the indians land. are we going to give them back? chris from st. louis missouri, hello. caller: i would like to respond to our last caller and say that god is not a state agent. we are going to talk about the number one point that you underlined in this whole resolution, the 1967 borders. it is illegal by international acquire land through war. that should be the underlying topic. theshould also address the u.s. has had countless u.s.utions vetoed by the against israel on their attacks

on lebanon, on the gaze of strip -- on the gaza strip. i am a little flustered with some of your previous callers. service --ite frost what phosphorus dropped on civilians. this whole thing is illegal through international law. it needs to be addressed. front page of "financial times" this morning --

that is the front page of "the financial times" this morning. in "the wall street journal" this morning -- two questions set out.

there is also this that broke this morning, this is from bbc news. this is the piece about the daxign-policy cheese jeff -- foreign-policy chief. it was reported that morsi has access to newspapers. also on egypt, here is the world news section of "the wall street journal."

one last phone call, all in spring hill, florida. a republican caller. what do you think about middle east peace talks resuming? i believe jehovah god gave israel to the jews and has not changed its mind. when the smoke clears the enemies of israel will be gone. that is my comment. host: in your book is peace not possible you go -- not possible? caller: no. the spirit behind the hatred for named satan.erally

since he is running things on earth here, temporarily, that hatred does not go away until christ comes back. host: that is paul in spring hills, florida. we are going to turn our attention to the third year anniversary of the dodd frank reform act. will talk about its effects so far. in light of the 48th anniversary of medicare we will take a look at the future of the program and the challenges it faces with the former administrator of medicare and medicaid, tom scully. that is up next after this short break. ♪

>> one, i think they serve as a window on the past to what was going on with american women at any given time in our past history. so if you look at a first lady lady's life you get a view of what is going on with women. veryther thing that i find interesting, from a women's is that thedpoint, conjunction of the public and isvate lives of women, which a topic that many scholars are very interested in. i think first lady's epitomized the coming together of the public and private life. series, "first ladies, influence and image," examines the lives.

the series weeknights, starting next week at nine eastern. >> when did we reach a point where you had to have a certain philosophy because of the color of your skin? when did that happen? a reporter once asked me why i did not talk a lot about race. i said because i am a neurosurgeon. [laughter] they thought that was pretty strange. when i take some a to the operating room. when i take off the bone slap and open them up, i am operating on the thing that makes that person who they are. the cover does not make them who they are. when are we going to understand that? >> and carson takes your e- mails, calls, and tweets on

booktv on c-span two. clark's "washington journal" continues. with: we are back sheila bair. she is now the chair of the systematic risk council. welcome to "the washington journal close quote -- "the washington journal." it is the anniversary of. frank. what is its ineffectiveness? -- what is its effectiveness? i think we got progress on implementing the ban of taxpayer bailouts. the larger institution is a bankruptcy process. i think there has been good work there. we had good news a few weeks ago when the bank regulators proposed substantially higher

capital requirements for banks, restraining there he ability to use leverage, which was a key driver of the crisis. the new mortgage lending standards, that was a central part of dodd frank. i think anybody's financial services should be glad the consumer bureau is there. the risk is better managed. with at said, a lot of cree -- a lot of key reforms have not been implement it. been proposed but they have not been finalized. we had a big problem with many markets during the crisis that required a huge amount of taxpayer risks to back market funds. some reforms have been proposed, very incremental. it in the right direction. i just think there's a lot more work to do. host: the senate banking

committee is holding a hearing today with the chairwoman of the security exchange commission, as well as the chairman of the commodity futures trading commission. what would you ask them if you were a senator? for mary jo white, she was a tremendous pick for the sec. she has good management skills and a lot of things going for her. she really helped write that ship. i would ask her about her ability to fund herself and going to this appropriations process, which is increasingly dysfunctional. i would ask her about market structure. she is high-frequency trading. these trading strategies have undermined the public's

confidence in pricing mechanisms in our equity markets. i guess those would be my top three for her. for gary gensler, same question about his ability to fund himself and his agency and their ability to engage long-term planning. again i would commend him on the for moving has made derivatives to centralize clearinghouses. i think he is going to be leaving at the end of the year. i would ask them what more needs to be done. my personal view is derivatives are a tremendous problem. there is still a source of instability. host: we are going to be covering that hearing here on c- span. span3 at 10am. you heard some questions from s heila bair. you mentioned the slow going

process of implementing the dodd frank bill. take a look at this, this is from 22010 to july 2013. goldman sachs has had 22 -- 220 two meetings. morgan stanley, 170 five. bank of america, 156. what do you make of those numbers? it just shows that there are reform groups out there pushing -- it shows how on evenly matched this debate is. that is one of the recently formed a systemic risk council. we try to provide some balance in the public discussion as well as the kind of feedback and input the regulators give. it is a huge problem. it is a spectacle. it is against the long-term interest of these banks. they need a good regulatory progress -- -- process and this , that just undermines

their long-term interests. their industry is all about trust. if they do not trust the regulators they are not going to trust them. i think it is very shortsighted. let us know what the landscape is going to look like and let us have good strong goals. butant the rules finished it is the only -- it is only the rules they like. it is a spectacle. and the people who are trying to speak for the public interest -- all of these going to regulators. the autoila bair up deposit corporation. she is now the chair of the systemic risk council. tommy what that is. guest: it is a group of senior people. we have a senior advisor.

we have former senator bill bradley and bill donelson. project to create -- joint project. we focused on systemic issues that we think need to be addressed and could have destabilizing systemic impacts if not addressed. large banks leverage can be highly destabilizing. we focus on too big to fail. to get the banks higher capitals. and also much bigger cushions of security debt so if they do feel a large central to financials institution. it is really a stellar group of people. they are all volunteers.

none of them are being paid for this. they want to do the right thing. they want to provide -- they want to provide the appropriate balance. host: first phone call for you, imperial beach, california. good morning. i have heard prior to 1999 there were zero dollars invested in derivatives. i would like your opinion, i have heard there are $700 trillion of derivatives in the market. could you verify that or is that an estimate? that is probably about right. the aggregate risk of derivatives, even if you adjust for the emotional amount it is a big number. most of that is just financial institutions trading with each other. i think only 10% of the market is actually a derivative being taken by a nonfinancial commercial entity.

there is a lot of risk and a lot of interconnections. of the is that one --sons we have had a crisis there are a lot of unaffordable mortgages that have been made. we could have absorbed those losses. these derivatives have been written based on how the underlying market is performing. not understand the progress that has been made, i still think this is a huge source of systemic risk. it really needs to be a primary focus for regulators. >> so why isn't it primary focus? guest: it's just a huge amount of money. we have had this in the clinton administration. and secretaryspan rubin push legislation through that said nobody can regulate

this market. not regulated, insurance regulators cannot regulate it. hands off. point the most dangerous piece of this market was in summation. it grew into a monster. i think it is inherently destabilizing. there is no insurable interest. if you want to buy a credit default protection, in other words, say you own ibm stock. small sliver of risk the ibm stamp -- requirement that you actually own it that underlying debt. during the crisis they did speculate on how mortgages eddiem without having t underlying interest.

-- having any underlying interest. we were in a public dispute when i was pushing for loan modifications, getting these loans restructured. ande hedge funds came in opposed us and it was publicly revealed they were short the mortgage market, meaning they would make money -- the more people lost their homes the more they would make. it would create this upside down incentive. in -- you go to an insurer and they will ask you if you on that house. it will give you an incentive to burn the house down because you get a payoff. it is the same problem with cbs. it hasn't been effectively dealt with yet. >> and the focal rule will do what? thevpl; vokle rule will do what? guest: those in the safety net

get deposit axis to the window. they are there for public services, to provide credit to the real economy. it is not for the bank to give funding.ernment that is what it is about. that is really what it is about. it is hard to define proprietary trading. it has been difficult, but the overall principal is a good one. i think it is very necessary. after the crisis, these big investment banks, that had in the past been involved with a lot of proprietary trading, they are in these restrictions now, it has not been in post yet. host: why? guest: it is complex.

there has been a tremendous amount of lobbying against the rule and one of the reasons it is so complex is there are all of these exceptions. a of tranquility on twitter -- what role did the and at that -- what role did the fdic play in the recovery from 2008? i think we did some things right and some things wrong. ad hoc.onse was too some were bailed out, some were put into the resolution process. there was no playbook for dealing with these financial institutions, and while there was for insured banks, many of these problems were occurring outside of insured banks.

citigroup was an insured bank, but a lot of the activity was occurring outside of the insured bank. it was a lot of jurisdiction to put them into the government- controlled bankruptcy. there was inconsistency. at the end of 2008 we were dealing with a difficult situation and we throw a lot of money at it. i regret we threw so much money at it, but it did stabilize the system. in 2009, the fdic played a role in the stabilization measures that took place in 2008 and we were dealing with small bank failures. i am proud of how those were handled. they were seamless. there was uninterrupted access to the money. small bank failure was a nonevent. in 2009 we had a stable system and i wish we had done more to impose accountability, force them to sell assets, have loans restructured -- we would've

taken losses, but our economy would have been better off if we force the banks to make structural changes, cleaning up their balance sheets and it would be in a stronger position. we did not. now they are finally recovering and hopefully we will see more growth and better lending, but not so far. about all ofte this in your book "bull by the horns." it comes out in paperback in september. soseph ramirez greets -- tweet is bank regulating controlled and is that significant question reich guest: it is significant. -- question -- and significant?

guest: it is significant. the fdic supports itself. the fed can fund it budget. occ which regulates major banks, charges maintenance fees to fund itself. the regulators control them them selves. at the end of the day, if you want strong, credible regulators, they need to have the capacity to fund themselves because what you find with the -- sec and fdic is a lot of uncertainty. it makes it very difficult going through a yearly cycle which is a painful process for everyone, and lobbyists play games. they try to put an amendment on the appropriations bill saying the sec can not fund this or

that rule or they distract the agency had. it really hurts the quality of regulation. i know there are people that are mistakested with the made in the past. everybody has made mistakes. i think it would be better regulators -- if we wanted them to be better regulators, give them autonomy and have some certainty they will have money for their operations. host: keith in new jersey. democratic caller. the wife or hanging on the line. go ahead. banks are nowthe even bigger and are leaning toward crazy activities like goldman sachs moving aluminum around and jpmorgan manipulating the energy market, is there any

emphasis to get these banks to shrink and maybe reintroduce glass-steagall? guest: right. changing the capital requirements would create easiest incentive for them to downsize. requirementstal would create competitive pressure to downsize and that is a good thing. the resolution planning process dodd-frank,, under the big banks have to file resolution plans with regulators to demonstrate how they could be result in a bankruptcy process. this will require them to simplify legal structures and tease out there activities from .ore commercial banking elizabeth warren and john mccain have introduced a bill to reinstate a new version of glass-steagall.

i do not think that will go anywhere for now. if there is another big problem, be serious momentum to move that forward. thata very large think -- bank thats and takes deposits and makes loans, you can deal with that. it is when they get into all of these multiple business lines and become extremely complex, difficult to manage and difficult to unwind if they do fail. host: from "the financial times" -- "jpmorgan to settle -- bank t takes deposits and makes loans, you can deal with that. it over allegations." the finest $400 million. is $400 million. is that enough? guest: we have not seen the

actual settlement. it sounds serious in the newspapers. it is astonishing that all of these big banks are even into this business as deeply as they are. i am troubled and i hope congress will look at the process of how they got into this to begin with. it sounds like there were more legal opinions coming out of the fed and there was no regulatory process to publicly comment about whether or not these big banks should be into trading financial instruments based on commodities, but the actual commodities themselves and their storage and transmission. i find that amazing. i hope there is more scrutiny. i hope congress looks at the process by which banks are able to get into these activities. "the wallditorial in street journal."

chairman ofthe next ferc.- "the wallu think of street journal" taking on this role for ferc? guest: one would have thought have betterd oversight and how they were conducting this, but they do not have expertise on commodities. if these banks were mitigating those markets, a to be held to account andferc needs to do

that. >> do you know -- host: do you know ron binz? guest: no, i do not. int: back to the phones, rob makem, georgia. in 2008 therember was a huge financial crisis and we bailed out a bunch of these financial institutions and ultimately general motors. ofm curious as to how much of that money came back into the treasury, and i guess we made some profit on some of the. i'm curious about where did it go -- did it go to pay back the debt or did he go into the general fund and we spent it?

guest: on a cash flow basis, the government did make money. part of that was treasury investments, part of it was the fdic lending facilities. for those programs, they went into the budget of the fed and the fdic. for the taxpayer investment, those funds went into general revenues. you can judge how you think the government is spending its money these days. on a cash flow basis, we did make money. we did make a profit on all those bailout programs, but if you look at the subsidy costs, what the government could have charge based on market conditions at the time, we lost money, and that is the more accepted definition of accounting for taxpayer costs used by the government budget office. you know, look, i'm glad on a cash flow basis we made money, but, again, these banks were

hurting. some of them were healthy. some of them were not. i could not have access loans and equity investments for -- they could not have access loans or equity investments for any price and the government stepped in. i never wanted to happen again. i do worry when people say the bailouts made money, what is the big deal. it is a big deal. they reinforce the moral hazard that these institutions can take risks and then go and get help until they get themselves in order. host: springfield, massachusetts. independent. caller: a couple of questions. i have always heard the banking system was going against the constitution because it was owned by private investors. i want to hear if that is true. and why can congress not take the same steps andrew jackson did?

guest: it is constitutional -- the banking system -- i have never heard a serious constitutional challenge the way our banking system is currently constructed. we need banks. that is the harsh reality. not all banks are bad. a lot of community banks and of themselves quite well during the crisis and cap lending. institutions,er you have to differentiate between the ones that did the really stupid, dangerous things and others that were managed well. in reality, we need banks, but we need to make sure they are takeined, they do not excessive risk and they do not become so large and complex that they cannot be reasonably managed, whether they do not accurately enough political power that is difficult to have regulation in place. i worry that is the case now that i think we can do a better job of regulating them. host: andrew.

florida. democratic caller. hello, ms. bair. thank you for all of the great work you did with the fdic. guest: thank you. caller: i have two quick questions. wingers say that fannie mae and freddie mac were responsible for the crisis. i would like to hear your fannie maethat, and and freddie mac going forward. what is your view on the future of these institutions? .uest: thank you there is plenty of blame to go around and the idea that it is fannie and freddie's fault or that it is all of the

government's fault is just nonsense. read drove -- greed drove this. these package together and sold off as security investments by wall street firms, that is where it was occurring. fannie and freddie had a role in that because they bought those securities. they provided the market and they made a lot of money because with frankly,es, abusive loans with high interest rates, buying those securities, they could make money because they could borrow cheaply because everybody thought they were government back. it was a symbiotic relationship. so, i think that was a huge mistake on the part of the fannie and freddie management.

again, this idea that they drove the crisis -- they did not had or that -- did not, or that low -- low-income people wanting housing drove the market is not true. the people were taking out there fixed rate mortgages and putting them into the steep, adjustable rate mortgages were after a few years the payments would go up and you would have to pay repayment penalties if you try to refinance out of them. that is really the tragedy and it concerns me as i do not see serious effort to reform the securitization market. meet the low-reet income housing market was disastrous. you do not want wall street securitizations to fund lower income mortgages until that

market has been reformed and i do not see that yet. host: there is a bipartisan effort on -- in congress to dissolve fannie mae and freddie mac. guest: reg. they were publicly traded -- right. they were publicly traded. to therofits went private sector, preferred shareholders and bondholders. they were able to have nice profits because they could ro cheaply and reinvest that money -- borrow cheaply and reinvest the money. other bondholders were -- all their bondholders were protected when they failed, and that reinforced the moral hazard. now we have these entities that are 90% of the mortgage market run by the government. we do not want this model. big-nk we should have a time presence for first-time

homeowners, and for veterans, and expanding the fha and va to perform those roles is healthy. we need to think hard about whether we need to subsidize mortgages for other sections of the housing market, and that is the debate going on now, we do not want this hybrid where the government is backing entities and make take a lot of risks and socialized. are moree the idea of having of an eac-type of -- fdic-type of mechanism, where it is the government having a public interest mandate and it requires the market absorbed losses. host: a lawsuit was filed against the treasury department.

"when the nationwide mortgage crisis first the cold, fannie and freddie shored up their balance sheet guest: right. this is why we need a standardized process to resolve these large financial institutions. i would agree, the rule of law, the government should pay -- get paid back. when the government comes to the assistance of an institution like this, they can and should

be paid off the top, but once , ifayers have recouped you're following the basic claims priority, there is still value their and there should be some recovery. this is very difficult. what is the cost to the government -- the subsidy cost, or just a cash put in? i think these are difficult policy questions that need to be resolved and unfortunately has to be done in an ad hoc way. i not sure i understand what he is saying in the government encouraged banks to recapitalize fannie and freddie. i do not recall that. there is a problem with what we call the capital rules. i have criticized the capital rules. if banks invested in securities that are government-backed, implicitly or explicitly, you could use more leverage to make

ande types of investments this creates upside down inestments to invest securities. they have the same rules in europe. that is why so many banks invested in this trust that. -- invested in him distrusted that. >> it -- host: republican caller. kentucky. thank you for waiting on the line. caller: thank you for taking my call. i have some questions for sheila bair. could you explain to us in the audience what a derivative is? [laughter] hold on. i have a couple of more. with regard to the dodd frank act, couldthey have the same run europe. that is why so many banks invested in this trust that. you tell us what the was, and secondly,

after it was passed, what was respect to the number of people that could become qualified for mortgages. i appreciate your answer. guest: sure. what is a derivative -- a derivative is basically an instrument, and investment, if you will, where the return on it is based on some other asset's performance. for instance, during the crisis, there were derivatives based on the performance of something called an abx index, which is ofex on how a basket underlying derivatives were performing every it is like gambling on a foot all game -- performing. it is like gambling on a football game.

you can have that's placed on home mortgages will perform and you can do that on a lot of assets -- physical commodities, stock indices. a derivative is an instrument that performs based on how another asset performs. i hope that helps. the purpose of dodd-frank was to give us a more stable financial system and provide better protection for consumers in financial services where we had not done a good job -- -- good job of protecting consumers. that has not had much of an impact one way or the other on the rules for getting a mortgage because the deals have not and -- rules have not been finalized yet and we really do not know what the regulators are going to do. frankly, there needed to be and still needs to be tightening for mortgage standards, at least when the mortgage is being securitized, which means if the

person is making the mortgage, they do not have to hold the risk of the mortgage defaulting. when you are dealing with that scenario, you need to have top standards. i'm not sure we have that. the consumer bureau has issued baseline standards for all mortgage origination which is helpful and provides better clarity, so on the margin that might help people get mortgages, but dodd-frank, i do not think as much of an impact one way or the other. -- assuminguestion the derivative market is headed for another crash, how do regular people protect their assets? is a really good question. i am not a financial advisor. people are asking me that all the time. are afraid to invest because they do not know what will happen because the go to all ofan

these places host: can you -- places. ask what percentage you are not investing? [laughter] alwaysthe banks are asking me you have all of this money, and i really do not know. the interest rate market which is based on how big banks perform, which means as rates go up, they have to pay on derivatives -- i do not know how that will perform. ed is a market that has not been tested in this kind of environment. i hope the regulators are on top of that. it is still an opaque market, very complex. --t: arnold on twitter

quantitative easing is ruining our country and the value of the dollar. ofst: i am not a big fan quantitative easing, as i have written several times. i think it is a terrible mistake. there was some justification in 2008-2009 when the system was credit tozing up, and ben bernanke for stepping in right, duringe is the great depression the central bank tightened instead of east, and that is why we had the great depression. it punishes savers and creates distortion. it cheap money is all about getting people to borrow. the reality is the system needed to the lover. people need to boost savings. we do not want them depleting savings and borrowing again. on the financial side, we had the same problem.

i hope they get out of it. i think you will be hard to get out of it. and require anful strong will to exit polling need to get out. host: "the new york times" editorial -- choosing the fed leader, who should replace ben bernanke. they say it should be janet yellen. editorial andthat i hope everyone endorses janet yellen. she is extremely well-qualified. she is stable. she is rational. she is independent. she is the quintessential public servant. she is not in the wall street much which has driven too of decision-making. even though i disagree with her on monetary policy, i have also said she is best equipped to get us out of it because we had a

vision of how to get into it. anotheration, which is important function, she would be much better than the other candidates. host: the other candidates -- larry summers, why not him? guest: he does not have experience in monetary policy. i am troubled by his push for deregulation. he does not regret much of that. i do not know where he would be on monetary policy. my guess is there is probably not much difference between him and janet yellen. i regulatory half -- on agulatory, there's probably huge difference. host: host: let me read a little bit from this "new york times" editorial, referring to what you ,all the wall street club including robert rubin. in 1998

questions the "new york times" editorial board. bob. michigan. you are on the air. caller: i have a question about when exactly are the people on wall street -- we see both sides of the aisle calling this criminal activity shenanigans, as though these folks are leprechauns plain and simple tricks. finds seen to be doing no good in terms of regulating the

activity of these wall street banks. when exactly are these folks, these criminals, going to be called what they are, major criminals in terms of fraud and grand theft and prosecuted as such, and what does dodd-frank have to do with that, and one will the stuff be implemented where these criminals will be taken off the street just like we would take regulars dealers off the street in the inner- city? guest: the lack of accountability has been troubling. dodd-frank does not deal with criminal law. he deals with regulation which are civil in nature, not criminal. i think that is a question you have to be asking the justice department. it is curious. there has not been much in the way of criminal prosecutions and accountability and even when civil cases are brought, they are brought against a bank or corporate entity, and not the individuals.

you want your enforcement strategy to change behavior -- to make behavior better and create incentives for better behavior. if you are just going after the bank, it is the shareholders. has taken to trial one trader from goldman sachs. this from the is this day section of "the new york times pick of that trial is wrapping up and it says the case will come down to how the nine jurors tourre. the that you of limitations is running out. -- the statute of limitations is running out. you call it has run out in some cases -- guest: it has run out in some cases. there is a strong case.

we will see. because these instruments are so complex, the vehicles by which the alleged fraud was perpetrated, it can be said difficult to understand and jerry convictions can be tough -- jerry convictions can be tough. -- the jury can be confused. host: from twitter -- ms. bair, should we adopt a financial transaction tax? guest: i have come around and that -- on that. we used to have a transaction trading,or short-term it would make this high- frequency trading on economic -- not economic very fast. just very small amounts are

being proposed, but if you are trading hundreds of thousands of trades a day, the money will add up pretty fast. i like the idea. i think it could be stabilizing. i think it rewards the right kind of behavior and it could raise revenue. again, it is controversial. a religion against any tax and all the wall street money is against it. host: ann. democratic caller. california. caller: hello? ms. bair whysk the banks can not give us a higher interest rate our regular savings? and 2/10 ofing 1/10 a percent, and they want to charge all of these extra fees. it seems unfair to the consumer.

guest: this is a manifestation of the federal reserve board's desire to keep interest rates for loans -- low. it penalizes saving. in fairness to the bank, the way traditional banks make money it is between the what they make on the deposit and what they make on the low, but if the rate they charge on a loan is low, the rate on the deposit will be very low. the answer is for the fed to get interest rates up a bit to reward savers. host: as the federal reserve chairman winds down his tenure, what grade do you give him? guest: i'm a big fan of ben bernanke, even though i disagree with the monetary policy he has pursued. i think he has done it with the right motivation. i think history will treat him well. he did avoid a great depression

so he did not repeat the mistakes of his predecessors, but did he leave it to long? it will be years before we know whether this was a wise thing or not a wise thing. i am hoping i am wrong, and he is right, but i do fear about the kind of distortions we have created. times"the washington with this headline -- ben bernanke to give deposition in aig lawsuit. what do you make of that? guest: i think that is wrong. the court should not allow them

to depose ben bernanke. i think that is wrong. i do not agree with everything that went on with the aig bailout, but people had to make decisions in a high-pressure situation, and looking back and second-guessing by all accounts a mismanaged institution that would have failed, i am troubled whether the things are pointing to all of the derivatives counterparties paid in full. we have a process and framework to avoid that kind of thing happening again. even though i disagree with that, i will acknowledge decisions had to be made quickly. i did the same thing at the fdic. we should talk about whether the right decisions were made, but this kind of legal process is outrageous. they should leave then bernanke alone. host: sheila bair headed up the fdic from 2006 2 2011 and now

she is the head of the systemic risk council. as he mentioned earlier, the senate banking committee is holding a hearing today -- as we mentioned earlier, senate banking committee is holding a hearing today discussing dodd- frank and implementation of that law. thank you for your time. coming up next, in light of the anniversary of medicare, we will talk with tom scully, who headed up medicare and medicaid, and then later, bill allison of the sunlight foundation talk about efforts to track congressional fund-raising and first, a news update from c-span radio. >> at least 10 suspected nazi war criminals ordered deported by the united states never left the country according to an associated press review of state department data. four are living in the u.s. and

all remained eligible for public benefits until they exhausted their appeals and one beyond, and the reason being no other country was willing to take them in. the senate is set to confirm new members of the national labor relations order. the senate is set to vote on a president obama nomination to join the board. leaders are hoping for confirmation by the end of the day for him and two others. parthree nominations are of a bipartisan deal earlier this month where republicans agreed to and the laser nominations and in return, onocrats -- and the ladies nominations. live coverage on c-span two. the house comes in at noon. president obama speaks today at the amazon fulfillment center in chattanooga. a white house senior adviser

of his efforts to focus washington on the middle class, today in tennessee the president will call on washington to work on a grand bargain focused on middle-class jobs by bearing reform of the business tax code with a significant investment in middle-class jobs." you can hear live coverage of the president's remarks on c- span radio at 2:00 p.m. eastern time. those are some of the latest headlines on c-span radio. >> one, i think they serve as a window on the past to what was going on with american women at any given time in our past history. if you look at a first ladies life, you get a view of what was going on with women. the other thing i find interesting from a women's history standpoint is the conjunction of the private and public lives of women, which is

a topic that many scholars are very interested in and i think first ladies it minimize the coming together that -- of the public and private life. host: out -- >> our original series "first ladies, influence and image," examine the impact of the first ladies. watch an encore presentation starting next monday at 9:00 p.m. eastern on c-span. >> "washington journal" continues. joining uscully is from new york. he is the former administrator for the centers for medicare and medicaid services. mr. scully, thank you for coming "ack to "washington journal this morning. i want to begin with the front page of "usa today." here is the headline.

what do you make of that, mr. scully? a lot of that is the economy being slow. we owned hospitals and a lot of other facilities, and admissions are down. the one thing the administration has been pushing is to try to change behavior and get fewer people to be readmitted to the hospital, so that number is good

. a lot of individuals have higher co-pays. the fact that the economy is slower. slowve been trying to health care spending for 30 years, so it is good, but sadly a big piece of it is the economy. on to"usa today" those say -- goes on to say what is your reaction to that? guest: well, it is good news. a lot of it is hired to dr. moz and copayments and people not higher off -- is

deductibles and copayments and people not putting off elective surgeries. host: what do you think it means for the medicare program? guest: it means slower spending, but demographically, there are 50 million people in the program and in the next 20 years it will go to 80 million. i am 55. have a ton of people aging into medicare and not as many taxpayers my kids age to pay for it, so the real problem is demographics in the short run -- in the long run. and the short run, it is in good shape. host: i want to show this chart on the medicare costs as a percentage of overall economy.

can you speak to that a little bit more? medicare,you look at medicaid, the programs that iran, and social security, -- security, and social they are two thirds of the budget. it is swallowing up the budget. you get to the point where if it isers worry that growing, you have to know the roads and schools and other things, so it is fundamentally an economic problem comes when you are running deficits that 9%, 10% of gdp, that is a concern, but it is probably the most popular programming the government. seniors love it and disabled people rely on it, so it is a

critical program. were to the numbers we speaking about, the kaiser foundation says spending, in 2006 it was $403 billion. in 2012 it went to $506 billion, and 2022 estimate is $1 trillion. om scully -- guest: that is like carl sagan. host: what is driving this? is it the demographics and what else? guest: health-care inflation has regulareen above

inflation, so the numbers you quoted are relatively good news. one the population is rapidly is going growing, it to be a serious burden on younger taxpayers as they go forward and we will have to make reforms at some point, whether it is raising the retirement age at some point or reforming the program. there is no way to sustain the program as it is. politically, everybody puts that off, but it is a challenge. most people think the social security retirement age is 65. it is actually 66. congress quietly moved up one month at a time. it is 66. medicare is 65. we need to raise the retirement age gradually, so that people are not shocked by it, make market reforms, that these things are tough.

host: that is the future of medicare. scully,alking with tom who headed up the centers for medicare and medicaid services. we also want to talk about the history of medicare as it is the 40th anniversary of that program. we want to hear from medicare beneficiaries. the numbers are on the screen. arescully, for those that not so clear, what is the difference between medicare and medicaid? guest: medicare is roughly 50 million people. about 8 million people are disabled. dialysis about 400,000 patients. regardless of your age, you are covered by medicaid. if you are disabled, you qualify for medicare. the bulk is for seniors over the

age of 65, and there is a difference in the way the program is structured. 72% of the people in the traditional program where the government operates as the insurance company and sets rates, about 20% of the people are medicare advantage, which is essentially the government saying you can buy private insurance. that is the medicare program -- a senior and disabilities insurance program run by the federal government. medicaid is for lower income people. it varies by state. 56 different programs -- 50 states and six territories. they are radically different. they all generally cover low income people. one of president obama's accompaniments was an expansion of that. it is roughly 60% financed by the federal government, 40% of the state. forcost is about one-third

women and kids. hird is for its third is-- about one- for disability. medicaid is generally low income. it covers long-term care for seniors and medicare does not cover much in the way of long- term care. it is for older seniors. there is an overlap, about 10 million seniors that are low income seniors over 65. about nine or 10 million are dual eligible, which means that medicare has significant andctibles and copayments medicaid will cover the cost. host: why was medicare started?

guest: well, it was started originally in 1965 because seniors did not have health insurance, and as people age, are not working anymore and burn through resources, they consume a lot more healthcare than younger people and it was a major social problem it. -- thee basically impetus was to solve a massive societal problem which was that older people got sick and did not have health care coverage. it was created in 1965. it was a complicated program. it was a hybrid of what traditional blue cost -- blue cross coverage was then. rtcan go through part a and pa match it is a complicated of what traditional healthcare

insurance look like. a is the hospital, nursing and tweets -- allow younger people to buy into medicare -- would that not bring down the cost, or is that too close to single-payer? guest: it is single-payer. we have three different systems. if you are over 65, we have largely a government, single- payer system. if you are under 65, with the andanges president obama congress put in, you have more of a private insurance system, and medicaid is totally different.

medicare has wonderful things about it and covers a lot of people, but the worst thing is the government fixing prices, and that is not drive good behavior. i do not agree with president obama's planned. i am a republican. i think we spent way too much money, way too fast, but the concept of putting people that are uninsured on exchanges has not been that controversy of of the idea. -- contrary will of an idea. how you will subsidize people and how fast you will spend the money is a different debate, but the concept of a well-organized exchange is a better way to go than having people buy into medicare. program,is a wonderful but as far as an efficient program, i do not think it is efficient and it is much better to get away from the government fixing prices, which we do in

medicare. every doctor and hospital gets paid the same thing. what president obama has done in the commercial market -- private charge the doctors differently. host: brian is a medicare beneficiary, and a democratic caller in oklahoma. why are some services offered and others are not? not -- say it again? -- t: why some services are caller: offered and others are not. guest: some services are not covered. medicare has a large staff of physicians that make coverage decisions. every device company or drug company that comes up with something new want medicare to pay for that regardless of the

cost, and whether it is a private insurance company or the federal government, somebody has to make a decision on what you will cover or pay for otherwise there would be no end. medicare has a detailed coverage policy. if you are a device company or have a new this feature, you apply for a coverage decision and there is a lengthy process as to whether they will pay for it. medicare is generally pretty generous relative to private insurance. host: rose. republican caller in new york. welcome to the conversation. caller: thank you. i want to make a couple of comments. you are right. medicare is very generous. what i find interesting is a lot of these discussions involve descriptions of medicare and two entitlement programs, and i know people get sick of hearing this, but

medicare -- people actually paid in for that. medicaid, the taxpayers have supported the program in general. the thing that people might not know, and i find it interesting in light of medicare and everyone screaming how the fund is depleting and needs to be reformed is that just a few years ago, at least in new york state, they took the individuals who were disabled in terms of medical and mental health ofness -- they took all those that were receiving prescription coverage under years,d and had been for off of medicaid for prescription coverage, and they put them onto medicare coverage. is what i do not understand if the medicare fund is being quickly depleted, why would they remove all of these medicaid-

prescription coverage people onto medicare? guest: there are a lot of questions -- on the medicaid program, the state of new york pays for half, and the federal government pays for have. on the medicare for rim the government pays for the whole thing. -- medicare, the federal government pays for the whole thing. it was a questions -- on the medicaid program, the state of new york pays for half, and the federal cost shift. once the medicare drug benefit became available, most said the federal government would pay for all of them, let's shift them over. it happened in many states. the discussion about the trust fund is political. there is no such thing as a trust fund. we collect taxes and we have a deficit of $1 trillion a year.

when the money comes in, it goes nice entry toa figure out how much money we collect, but there is no such thing as a medicare or social security trust fund. we are collecting more money taxes, then hi payroll tax and medicare, and we are spending. on current services, it is solvent. as there are more seniors and fewer taxpayers, there will be fewer taxpayers, but the reality is there is no money in the trust fund. it is spent on something else. the fundamental problem is we have more seniors coming down the pike and fewer taxpayers, so at some point we will have to cut benefits or pay more taxes. there is no magical trust fund. i spent many years at omb. -- host: sea of

tranquility on twitter wants to know -- how do you measure the quality of care in medicare and medicaid, hasn't changed over the years and what are the factors? guest: it depends on the state. there are vastly different programs. new york state probably spends probably about $8,000 or $9,000 per beneficiary. some of the lower covered states, two thoughts -- $2000 or $3000. medicare is consistent across the country. they both, for the most part, pay for most things. it is hard to find and access problem in the medicare program in particular. 95% toage, medicare pays 100% of cost. there is a cost shift.

medicaid generally pays about 60%, 70%. the government payers pay less and force a cost shift on private insurers. it has been going on for years, but as a general matter, medicare and medicaid are good payers and critical to any practice. host: the usa today" weighs in on pay for providers and they say doctors set their own pay and specialists prosper. they say here is how the system works -- "theon to say that

washington post" found that one dr. managed to cram 26 hours of paid work into a single 10-hour day. >> they should. this is a complicated argument i have been in the middle of so it the a.m.a.'s fault. of major reforms happened in 1989. i was working for president bush 41 and was involved. hen it passed in 1989 the agency had a different name had o come up with a way to pay doctors. it is $125 billion a year now a relative to have pay structure versus what you a primary on versus care doctor. they didn't have the staff at

1991 or 1992. do it and nteered to it was delegated. advisory ated the pan panel. hrlast 30 years the .m.a. panel has made recommendations to medicare about what to pay doctors. 31 doctors on the panel. i'm sure they are trying to do the right thing. the issue i have with it and i wrong and everyone agrees was an accident of don't is because they have enough staff the a.m.a. makes the recommendations about should be paid and they delegate -- they give the which tion to medicare takes 95% of the recommendations. should think the a.m.a. be making the decisions. they decide who is on there. political you can imagine between the surgeons and

urologists and who is on the panel and control the price fixing. be happy to take the same 31 doctors and have them be the government or independent panel. i just don't think an --ependent trade association it is not their fault. they volunteered to do it when gap but nment had a ever since then they have had a disproportionate impact on policy so you have the a.m.a. effectively deciding what $125 rs get paid for billion a year which is crazy. it is like asking the hospital for hospital rates. it is not their fault. sure they are trying to do the right thing but it is a long problem. everybody agrees it should be inside the t government so it is more independent. doctorspick the same 31 but they should rotate and not on based on who has the biggest

of the a.m.a. it should be a representative doctors and hat other professionals are paid ecause it is a very political goal for price care setting and is run by a.m.a. their fault. they are angry at me for making this argument. their fault, it is just the process was screwed up n 1982 and should have been fixed long ago. that is the crux of the article. money to be of price fixing by a private trade association. host: c.q. is reporting there are steps you want way by a to look for a rt new way to reimburse doctors in medicare plan. the a.m.a. did write the "u.s.a. today"or this morning the doctor who is president and writes this as medicare's ltimate decision maker c.m.s.

has a seat at the table and is not obligated to accept the recommendations. government does accept them medicare expenditures for physician services do not change is capped.ding any payment increase requires offsetting decrease. 2014 medicare fees are expected on average about 54% of physician direct practice costs. guest: you can debate that. seat at thent has a table thank you with the a.m.a. billion. $125 the issue is -- the pot is $125 billion. the issue is who decides what versus the urologist surgeon versus the primary care doctor and the doctors should but the decision of who is on the panel to make the decision shouldn't be made by a.m.a. the way you get a seat is what

join tage of your members the a.m.a. ost specialty societies say oncologists or urologists don't like this game but they have to to a certain personal join figure out the prices. it shouldn't be run by a trade organization. of the d be part government. they have done it for years. thatless them but the idea the meetings are not open to the transparent and the fact that the government delegate it is insane. they were asked by the to do this but it is a functional mess. is a smart guy from seattle and member of ways and the committee and leading charge. congressman brady is the ranking with them.working nobody wants to make the a.m.a. or doctors mad. congressman does. but as a matter of public policy most people would be outraged

found out the a.m.a. is billion a year prices. doesn't have enough personnel to do this. my old agency is a great place but they don't have the personnel. a.m.a. has a big staff. that should be picked up and put federal government. i'm a conservative republican. the ot big on having government take things over. it is just a whacky idea to have group -- there are not any groups in the government that spend $125 billion but that is nuts and i'm glad this is discussed. host: jim mcdermott feels our aboutlast week and talked his efrpbts at the end of our interview. c-span.org and listen to what he did. from ine is next

tuscaloosa, alabama, independent caller and beneficiary. caller: i would like him to medicare and medicaid are totally different rograms because the medicare recipient pays into -- i think this e previously stated -- the medicare recipient pays into the medicare fund. medicaid recipient often times does not. recipient is re not always eligible for medicaid. tois very difficult for them get assistance from medicaid if recipients.dicare i would like to ask a couple of questions. hat happened with the money you was taken from the -- said there is not a trust fund for medicare. but what about the money this from the trust fund previous previously? ago.as been several years was it ever placed back? uest: i don't want to scare

people. there is a medicare trust fund and social security trust fund taxes come and go. when you pay your social security taxes and they go into taxes for d or medicare and they go into a rust fund the second they get there we have a $1 trillion deficit. $3.6 overnment is spending trillion and raising, $2.7 trillion and the way they that is borrow from the trust funds. the l that money goes out door to help general spending. o there is money in the trust funds they are just giant i.o.u.'s. there's in the a giant trust fund. it is a functional game. i don't want to scare people. there are trust funds. money in over the years and the government puts a check in. the reality is they are a budgetary fiction. they don't exist. is unfortunate everybody thinks week relying on them because the money has been

spent. lent it to ourselves. the money used in the trust solid.it is technically you have medicare paid for ofghly about 40% of the cost medicare come from health paycheck taxes in the if you are not retired you pay employer oll tax and pays the same and there is a supplemental tax for higher plan. in the health that funds about 40% of the program. about 32% is part b premiums. he government figures out what you will spend on doctor payments and every senior pays taxpayers the other 75% and other fees and co-payments. there, nothing has been taken and it is structurally fine. is he long run the reality that it is not like there's a big bank. seniors agingmore and fewer taxpayers and the numbers won't work in the long

run. is unfortunate people think we have this great trust fund. thing.s no such host: next is a democratic caller. i like some of the you are saying. ut you sound like most people these gerrymandering districts they don't live in a real world. how can you always be saying bout running out of money funding and vote against wage ncreases and vote against everything and immigration but many of the people would be you g in the system but want to keep the number of people down that are paying or country or f the depressed wage and complain about the deficit. host: do you think tom scully is

a member of congress? you do?s like caller: no, i'm not. addressing problems but not about solutions. solution ison sense that you have people that can people pay, you have gerrymandering republicans look at as how we cut. cut, don't put anything in the put but complain about how the pot empty.ting host: ok. guest: thank god for you i never anything and don't plan to. moderate.ifiable the reality is there are not the do big tax increases or entitlement cuts. ongress is very split, the administration is split. in my life it has been like that i think advocate of guys like mark we were a democrat in virginia i consider

corker from senator tennessee who are working for middle grounds. the growth of w entitlements. you may have to raise taxes. that.t necessarily for i think you should limit spending. spent most of my life on low income programs. i think that the government income o help low people. i have been against -- i would tested medicare more. my problem with president plan is i don't think you should subsidize 62% of people's health care. that is $95,000 for a family of more. a lot in new york city or washington or l.a. but a lot in a lot of parts. be in a situation to americans' 2% of healthcare. relatively moderate. you have to be reasonable on who

help.fine as needing i think president obama's plan went too far. the 'm all for making sure programs work well. another example is the have tripled es the last 10 years. i personally think i was in for e of a lot of programs years and 10 years ago we covered most disabled people. those tever reason programs tripled. they get on medicare and at some make some ave to tough calls about who gets federal benefits. it is just a fact of life. you can't raise taxes enough to pay for it. there has to be a mix of ream but ement and not cut managing the programs rationally with whatever revenue you need. i'm an advocate of middle ground. i think the more moderates you results the ame better off. host: we are marking the 48th nniversary of the medicare program. this from the kaiser program. the characters of medicare 50% income below

$22,000 $22,000, host: those under 65 and disabled make up 17% of the population. here is a tweet from radical who know how much did obama take out of medicare to pay enforcement of obama care? there are different pots of money. the i.r.s. is funded with an account.tions part of the way president obama , part of the .a. money was reducing the growth rate of medicare. the funding to pay tpfor president obama's plan ca

taxes.gher the h.i. tax went un, medicare up for some.ll tax a mixture of half tax and half medicare cuts. medicare cuts were reduction of rate of growth and had a lot of providers so a mix. of that directly went to the i.r.s. but it is all one big treasury. i.r.s. spending went up significantly because a big plan is figure out 400% of he paoeeople at poverty and below and if you ome in to an insurance company and blue cross and say my income is 200% of poverty i want to they have to an determine your income and subsidy. year.t will cost $14,000 a federal government may pay depending on000 or the income. what theyto determine will by blue cross.

figuring a huge roll out how the subsidy system will work. -- onally i think that host: i was going to ask if you house republican strategy to defund the care specifically up for a vote friday is a bill by tom price ive republican of g. that would prohibit the i.r.s. from enforcing any aspect of the 2010 healthcare law. i like tom price. i know him pretty well. i personally would not have for president obama's plan because it is too much and the medicaid expansions were massive and spending expansions were massive. it is unfortunate it was not bipartisan. i spent a couple of years esigning and getting past medicare part d and my opinion the smartest thing is we spent a time with senator kennedy and widen and made it bipartisan

not exactly the republican or democrats wanted but it was very controversial. we passed it in a bipartisan ashion and it has held up and been popular. it was a mistake for president obama to pass the thing. no policy is going to be noncontroversial if it is 100% 100% line and that was party line vote. as a result, they made it bigger more to get more democratic support. repeal because we should make it smaller and start over but it won't be there are not the votes this to repeal probably ver so reality in my view is both parties have to think about t some point lowering the political rhetoric and making it more workable. would say go a few years and see how it works. we start january 1 next year with a massive expansion in most of medicaid, millions more on medicaid overnight and

as many as 18 million in the new exchanges. spending and coverage conceptually nice but and not saving neglect. i would have made it smaller. reality is it won't be repealed. i'm not in s congress and at some point it is what it is, we will have by it and we ted have to make it work better and people should look at ways to work better. conceptually in a perfect world with d start over something smaller. political thetically i might vote for appeal but you have smart people is e senator baucus who s it onsible and most likely will be next congress senator sane people.y are at some point you have to figure

out how to make them work most effectively. it is massive. it will need tweaks. would have made it significantly smaller. conceptually i don't have as any problems as many republicans do. host: on the house side there are two hearings on thursday. ways and means committee will look at the implementation f the affordable care act and house energy and commerce committee holding a hearing thursday looking at medicare the the current director of centers for medicare and medicaid. we will go to glen in mercer, pennsylvania. medicare beneficiary, democratic caller. like to tphknow seeing that i'm a baby boomer that we are g told draining everything, what the ned to all the money baby boomers put into it? i have been working since i'm 14 social security. and we put the money in and less people lot taking it out.

retir -- we are told it is almost bankrupt and i don't understand where the money went. we funded two wars with without doing anything it out of the social security fund? if you believe the federal government will keep operating for 200 or whatever you have to believe in the full faith your benefits we will cut because spending and raise taxes and you will get medicare and i'm 55 that medicare will be around as long as i'm around and politically it will going. but the reality is the money that we paid into the hospital last 30 taxes the years and into social security taxes went into the trust funds to the federal government for general spending for whether for medicare or war defense budget or road building or food stamps, the

spent.is largely that doesn't mean your benefits won't be there. they will probably be there. going ust in reality forward we have an explosion of seniors coming and smaller number of taxpayers and the have to change. the reality is there is no trust und at the local bank or local fidelity waiting to pay the bills. you go system and we will have to fix it going forward. that is why eventually you will age andraise retirement make reforms of programs because it won't be affordable. ost: where are you at now, still involved in healthcare? guest: i'm in new york most of the time. i loive in washington but i'm investment firm and at a a fair amount of taoeuime of -- i'm of im of counsel.

host: tom scully, thank you for helping us mark the 48th anniversary of the medicare program. appreciate it. guest: thank you. host: up next we will turn our political o fund-raising with the 2014 congressional elections coming up. with bill allison. first a news update. it is 9:22 a.m. eastern. 12.2% ine prices jumped may compared with a year ago. that is the biggest earlier 2006.since march of the increase shows the recovery is strengthening. increases were widespread with all 20 cities showing gains a may from april compared to year ago. prices in dallas and denver reached the highest level on 2000. back to diplomats are meeting in the ngton to resolve israeli-palestinian conflict. s a new round of talks begin secretary of state kerry thinks this are more reasons to master

quickly because as he said time running out. secretary kerry speaks to the media this morning. covering the event. that will be later in our programming schedule. accused of dier passing u.s. government secrets will learn if he of been found guilty charges. bradley manning has been on fort meade, maryland and could get a life sentence if convicted. -- we are ng track keeping track of that and will have the verdict after 1:00 p.m. eastern. latest from c-span radio. a very young was man when he was here in carson city. so he born in 1835 arrives in 1861. on 26.5 or going this is a form active period in his life and it is the the iences he has here all things he does.

then the things that he writes notoriety that he gets beginning in san francisco and new york city. this laid the foundation for the man who would become one of the greatest writers in american history. i would argue that without the carson city experience the nevadaa city experience, territorial experience, samuel lemons could have never been mark twain. -- about samuel clemson as easternsaturday at noon ens -span 2. saturday at noon eastern on c-span 2. >> "washington journal" continues. host: we want to welcome back editorial director to talk about fund-raising and for the 2014 congressional elections around the corner here. let's begin with what rules are in place for a member fund gress wanting to

raise. guest: there are not that many ules about how they can go about this. some hold events. some use direct mail. ways s a whole range of they can raise money. the basic rules are for can ibutions an individual give $2,600 per election for the general $2,600 for election. pac's can give up to $5,000. can help congress raise money for the party which can take more than $30,000 from they can also nd work with super pac's, the outside organizations, as long the member doesn't ask for more than he could raise for, ay, a political action committee. $35,05,000.k for they are not supposed to coordinate spending with the pac. one big ethics rule after 2007 the democrats came in and took over the house and senate

was a change in what lobbyists do for members of congress. one thing they couldn't do is host lunch events. there is a glaring exception. they can do it for fund-raisers sorts of ve all different rules. one is the tooth pick that as fit on a e food can tooth pick it is fine for a lobbyist to pay for it. of events where there is steak and expensive on the ends of tooth picks. that is a way to get around it. are very free rs to fund raise and don't have to they go much about how about raising money which is one reason we started the party time site. we do political party time.org basically have sources round town, it sort of started -- it went online in 2008 but i a st started in 2006 when friend worked for a firm was complaining about how his fax

by ine was overwhelmed invitations to congressional fund-raisers and i volunteered and ke them off his hands that is how it started. now we have over 18,000 all over s to events washington, d.c. the bulk are in washington sources are of the here. we would love it if we could get ore people to contribute fund-raisers. they happen all over the country. if we can get more from around we would be grateful. host: aware showing the viewers the -- we are showing the the website. you can send them an invitation website.d it on their are people doing this voluntarily? a member of p congress in any way get more coffers?their guest: there are a few that send them. fund-raising y consultants and volunteer what their clients are doing. them to people who give us are sort of frustrated

washington people who are tired by fund-raising and some are public spirited. some want the word to go out that they are raising money. the vast majority of them i that crazy about it and there's not a lot of disclosur disclosure. is one of sunlight's attempt to do disclosure to members of congress and make transparent. host: one invitation that is party ng that -- one happening this week on monday ight the invitation for a fund-raiser for senator tim kaine. from and who ming will be at this type of event? eyonce' concert here in washington. guest: it comes from the senator tim kaine. a etimes it comes from leadership associate pac and they have a list they send it to each campaign has its own

e-mail list and it will go to of trade associations, lobbyis lobbyists, the washington big companies like boeing or the big contractors in town. law firms in town. and washington is one of the so for raising money and those are the kinds of folks that will be there. be people thatly often will have an issue before a committee that senator warner on. and they list committees they are on for helpful reference. this is a chance for these member ofingle with a congress at a beyonce' concert. ost: you have a blog going about the party invites and who is attending. peoples concert how many are members of congress are holding fund-raisers around this? it wasn't just kaine. members ere are they hosting events around this concert and we see this a lot.

we erts are a big draw and see a lot of sporting events, nationals games, a lot of times out of town team, say cubs coming you will have a delegation hosting a night or members from the chicago delegation hosting an park.at nationals you can see it for hockey, basketba basketball. been kind of any time you get lobbyists into a sky box to be something members of congress like to do. show viewers to an invitation that went out for senator rand paul and others, be beer, bourbon and barbecue a paul.raiser for senator superman a -- explain a little one.his guest: there's been a yale political science study looking at this that sometimes it is the members that host fund-raisers for somebody else are the ones ho end up with the political chips. you have like a lot of times we

ee eric cantor or john boehner or nancy pelosi hosting fund-raisers for other members helped use they have somebody who is less name recognition raise money a lot of according to this study you have people vote being the member who hosts it. this is a typical event where -- it is amazing how many of them involve alcohol and martinis, martinis. one of my favorites in 2006 on c was a block party street outside the capitol where some members have residences and there were five republican members who had margaritas with and each different member had a different drink in house. this is the kind of thing we see a lot. seriousness remember who is showing up at these to have these drinks and it is insiders, ington lobbyists and special interests.

host: by the way on twitter we tweet what we need to do is outlaw lobbying. ave debates paid for by government but moderated by the public. michael in white plains, new york, democratic caller. you are up first. pwhrao caller: i'm here. host: go ahead. caller: i'm sorry. i hear you. the inion is that term, ble] has a single ublic funding for all federal electio elections. election.owerful ive the candidate air time and [inaudible] of what the parties can give. guest: there are a number of

folks who say basically the same thing, one-term president is not something i have heard before, campaign one of the finance proposals although term limits were kicked around back 1990's. f you do away with private fund-raising you would see the fund-raisers disappear. whether or not that will happen i'm not sure. idea not been a popular with members of congress although this is one reason we a lot party time site is of members of congress complain fund raising but we show how much time they spend and barbecue reative with and bourbon or beyonce' concerts. something members do. and some of them are quit good at it. talking about fund-raising efforts by members of congress with the 2014 elections around the corner. the sun late foundation website lucky 13 how

best secondwith the quarter hauls. we can show you some of the numbers as we continue talking of the sun lison late foundation about fund-raising efforts. here are the phone numbers on your general. -- eneral. -- neral. -- . --- ---screen. in ear from brian next independent caller. caller: this is business of 15,000 lobbyists in washington, d.c. you do the math. they are basically talking about 3,000 of our government members

house, senate,the white house and all of their staff members. ratio.e a five to one all lobbying should be done in offices or at t the miss of business who is -- place of business. guest: we would love to see better lobbying disclosure as a that.step toward some agencies, the federal reserve, treasury department and others that are lobbying d frank started to put their meetings on screen. we saw some of this the obama administration did. love to see the same thing from members of congress to disclose this kind of information. that you see a -- you do see a lot of meetings outside of the channels. hen the white house releases isitor logs what staffers in

the white house were doing to avoid the disclosure was meeting ith registered lobbyists at a cafe a couple of blocks from the hite house so they would not trigger a visitor log event. obviously it is much better to have those kinds of disclosures you can see who is coming in to meet with elected officials. american public deserves that. one thing sunlight has pushed lobbying, not e having to wait for the recorder and have actual meetings of who on capitol.t seen right now they will say they met with the senate or house. we would like to see which meeting with.re host: radical tweets in how ould everything based on signatures take money complete "out, town hall debates only. not enough signatures to get into debate. severn, maryland. democratic caller. caller: good morning.

question or your comment? aller: by the way, i was going to ask why is it that this country has to spend -- they that the next general election will cost this country billion. $2 to me that is outrageous. we talk about all the problems in this country and politicians can spend that kind don't blink an eye. guest: it is a huge amount of a lot of lections and this is driven by tv time and to advertise and there is a question as to how effective that is. i think at some point you get to overkill but that is what is driving this. crazy.e with you, it is host: we talked about the sunlight foundation reporting on election, 16 months away. there are 13 races that you your website. hose republicans and democrats

are challenging incumbent. mike honda is being $1allenged and his challenger million verse just his $345,000. $386,000 dole about $546,000. mike hoffman in colorado being another rematch nan hayworth is trying to win back her seat. that is some of those featured their website. matt is next in nebraska city, nebraska. republican caller. caller: how are you? allison ion for mr. would be after all of the money congressmen and

senators receive how much do they get to keep after said and done even after they leave office? could it used to be they turn their campaign accounts and own ally use it for their personal expenses. that was changed in the 1990's ith an ethics reform that eliminated that. they can give it to a nonprofit organization including for a 501-c-4, the social that spendanizations so much without disclosing donors. can give it to -- they can continue to use it as a fundamentals -- missile. mechanic a lot of them have their own olitical action committee and it can be useful so they can -- as long as they don't use it for things like buying yachts or playing golf or things you are not allowed to do it, as long as

use it to influence politics they can keep every typesnd spend it on those of activities. host: darrell is next from missouri, independent caller. caller: hi. they should tax campaign contributions when they them and when they spend them. maybe 50%. guest: that is not a crazy idea. political ll committees are tax free. and when you donate to -- you a tax deduction when you give to the committee but the committee doesn't have to on it.es one thing incumbent have a tremendous advantage. money for longer and have name recognition and they are in washington. committees give more to incumbent than challengers. aving some kind of tax on the leftover money might be a way to reduce that incumbent advantage.

don't think they are going to vote for that for themselves. but i think the done side of the already is members spend so much time raising money and are beholden to special that if you tax it they would have to raise that much more money. so you have people more dependent on special interests. mississippi, in democratic caller. the r: i feel like all of hoopla they were talking about 504 the i.r.s. and the funds i think that is what they ere saying, whether you are republican or democrat i think they need to stop giving these deductions.ny tax what they are actually doing is the source of the rich and powerful and lobbyists and regular people don't have any say because we don't have that kind of money. they all should be taxed and i think that the government doesn't have a right

exclude these people from being taxed and giving our money pay or letting them not their fair share. guest: the only thing i would is these groups that do operate tax free, again for the the 501-c-4's nvolved in the i.r.s. controversy and hugely impactful or at 2012 elections least spent a lot of money, not all of them got the results they like one spent $70 million and most of it didn't go winning candidates. they spent a lot backing mitt republican ome senate candidates that didn't win. tax hese groups get the exemption, the donors it is not give thetible and they money to the organizations. here are a lot of 501-c-4 organizations that do wonderful work and social welfare and ommunity groups and civic

associations. so, the bulk of them i think are ok. political ones and there may be a few hundred that we know about that were ctive in the 2012 election causing all of the controversy. host: we have this tweet. tweet.e have this how would you reform campaign funding? guest: oh, boy. problem.he big i'm good at pointing out the problems. i don't know how to fix the system. i would be happy to tell you. there are a number of defend proposals for fixing campaign terms of limiting the amount to doing away with limits and having instant disclosure. i'm skeptical that you will ever et money out of the system

large largely because what government does is important and government has an awful lot of money to away and can also through regulations and rulemaking processes cost people a lot of money. that is why you see so much money flowing into the system. ost: we are talking with sunlight foundation editorial director bill allison. we have about 15 minutes left. to talk about fund-raising efforts and sunlight foundation marking and website political party rg -- political time.org five years you have been keeping track of the fund-raising ies, parties that happen in washington. website, you their can see where if you have come you can invitation upload it and send it to them. an in mclean, virginia, democratic caller. caller: hi. youve a question about what think the citizens united

done to impact fund-raising in congress. guest: it has really pushed it through the roof. when you look at the impact of i think it is , much bigger on congressional races. if you are a house member and $100,000 on nds advertising in your district in -- sidential contain campaign that is a drop but for house member that is huge and house members proactively are trying to raise enough to fend off any kind of outside spending this and it has created this ongoing escalation in the raising.mbers are this is why you have the 2012 the very next did mitch mcconnell who is up for re-election in 2014 is holding a fund-raiser. we just got through one campaign the kickoff is the day after the election. this tweet.e

guest: i think this is one of questions what you really need for both of these is movements, write members of congress. they do listen to letters. you sunlight foundation.com. we have a number of proposals or at least making the system more transparent and open to people. just that, i think it is you have to keep your eye on and to on -- there are ways organize and pushing for these to citizens. is up but check out sunlight foundation. host: we have this tweet. government is -- in offices you are not supposed to do fund-raising on capitol hill offices.ment whether or not that happens or when people mention it

come up.ing does we have heard in congressional meetings so it is not as it has happened. but members are not supposed to raise money while they are at fund-raisers. one thing you know about these events that we have, i talked to a lobbyist and been a lobbyist for a long time says fund-raising and he somebody is having an event only february 2. and it is not like in a movie theatre. i go to the fund-raiser and talk to talk to, at the end of the quarter, march 31, check. when i mail my you see a lot of checks come in at the end. it is not so much it is more sophisticated than handing over member of congress at his job. it is more subtly played out. in t of these folks washington are aware of the ethics rules and are careful. host: we have this tweet from matt smith.

a republican call from now, dave.ia caller: organgood morning. bill, a question. some of the trepidation on parties to release names of donors is due being, they are afraid of being singled out in light of with the i.r.s. thing and being subjected to audits?sonal if so, to you envision more care types of -- caribou cafe events? you have a rule there is already some lobbyist who is three steps ahead and to get around it. that is why they make more money than i do. the disclosure, right now even super pac's, the groups american crossroads disclose their donors. campaigns and political parties disclose donors. there is a movement right now

lawyers are pushing against disclosure, a lot of state court cases. sort of this s tension in the campaign finance at d with people trying to the same time you have folks trying to impose limits or get trying to chipks away at them and do away with them. was the prop 8 and people condeampbell who donated to groups that were marriageof banning gay and were singled out and put on websites and they will face to the for giving group. obviously the i.r.s. scandal make anybody happy and makes people worry if you get involved politically you may be your neck out and getting audited. this is an unfortunate side scandal is e i.r.s. trust in government institutions is a lot lower. trust ds to be able to the institutions. that is why we need to get to skpbl.ttom of the i.r.s.

that said i don't think any of the reasons are a legitimate reason not to disclose. disclose everybody and only some people get audited that is the best way it realize there is abuse happening. host: in is a tweet responding to the term limits many are supporting that. he says if more term limits more getting ds to be spent public acquainted with new candidate equals more campaign fund-raising. guest: that could be the case. we do not have a position on limits. we care about transparency. one thing that can happen with you can have lobbyists have more influence. e have seen this at the late legislatures where states that have term limits the lobbyists are the people who have been and you have ast legislator there six years and 20 n and lobbyists there years and know all the ins and

outs and lawmakers are more dent them. that is another problem with term limits. name recognition is key thing for getting people elected. to get name recognition when you don't have it you have to spend a lot of money. little neck, rom new york, independent caller. caller: good morning. for taking my call. how can i as a private citizen my local bout congressman who is representing a precome wantsly par working -- predominantly poor working class queens and south bronx and there allegations that he has $7 in his campaign fund? guest: the sunlight a ndation.com on -- we have link to tools. one of the tools is influence you can puts his number in and see how much he's raising it who he's from. that is one place to go. there are several other websites

this kinds of information, a south out to open that we support. they also make campaign finance vailable and they have that kinds of cash on hand information. places i the two main would send you to. is phoenix, arizona. democratic caller. aller: thank you for taking my question. something where everything is efficiency. most ever ngine, truck driver and all to lower customersto encourage to come over. all of this is done in the name of business. hat i don't understand is how come businesses are allowed to donate money to campaigns that seems like the orst business decision ever giving somebody something that you can have no expectation of

return for. why is -- i understand why the donate butallowed to i don't understand why corporations are or any type of company. and i work at one. you help me? guest: actually corporations are not allowed to give directly to candidates, political parties, political action committees. this is employees of the companies. talk about a particular company has given x amount of oney what we are talking about is their political action committee which is money donated by employees and individual might add to ho this. but, that being said one reason that you have corporations which do sponsor the political action committees spending money on lobbyists as well is that they do think they are going to get a it.efit out of this is why we saw an election -- or million spent close to $2 billion all the nterests think they will get something out of it. michigan,from adrian,

democratic caller. caller: my question is, with all deadlock in congress, why can't we come up with a system that during maybe a presidential that there rm major t be, say, two issues that are brought up on a people or the american to vote on? gun reform, he here 90% of americans are can't one thing but we push that through due to that.ists and things like guest: a lot of states do have one thing we and see is you have special interests spending a fortune. washington state had a referendum on could retailers and costco spend

la like $16 million. interest and cial advertising trying to convince people this is the most measure or llot worst. so i think you would see the spending and attempts to people.ce but at the federal level we have no mechanism for direct that was the founders' decision and it would take a constitutional amendment that. host: what laws governing ethics passed ying have been recently and what do they say? guest: one of the most important is with the 2007, which is a while beco a while back, honest leadership and we government act got disclosures of lobbyists, they have to disclose when they make campaign contributions and run a political action committee. a lot of times when a lobbyist

alks in a member of congress's office what you are seeing is somebody who can't just give $2,600 but might be controlling his pac that0 from $15,000 for his firm and from pac's. of that has to be closed and when they give there money hat was one of the most important ones. >> this graphic from "new york times" when this was put into leadership and pen government act of 2007 prohibits them from giving gifts civil permanent to $200,000 from $50,000 and provides up to five years in for criminal violations. peter, howard beach, new york, independent caller. caller: i would like to know question -- ipart would like to know if the sunlight foundation is

the iated with any of democratic party. mentioning theep republicans. unions, in es to the 2008 the unions spent over $400 elections, yet they 401-3-c not for profit. foundation un late is not affiliated with any democratic organization and we ave had plenty of democrats complain about our coverage over the years. we are nonpartisan straight down the middle. as far as the labor unions are is the tax -c-5 group, nonprofit. nd essentially this is just part of the tax code under which they are organized. numbers refer e to, sections of the tax code and defines what a labor union can and can't do. over the years a lot of them have spent a fortune on

politics, $400 million sounds to me for the 2008 election. biggestthat some of the donors to members of congress unions.aigns are labor host: we have this tweet. vote candidates out. term limit them. it is undemocratic. democratic caller. are you with us? hello. yes, thanks for taking my call. -- s wondering, this issue the issue of campaign finance reform often gets broken down in republicans often opposed and democrats in favor. action or argument could be made to republicans, oters and party, to encourage them to get on board with campaign finance reform law? i hate to say, i often think it is self-interest. there was a "new york times" story shortly after the 2012

republican ere some members of congress were questioning the wisdom of the citizens united ruling because be up for ing to electi ofction, i think john cornyn texas was one of them and the concern is i'm going to have to so it is money now usually self-interest is the way to appeal to legislators. you get the know if best campaign finance reform that way. a lot of times you end up with incumbent ends up with an advantage that the challengers don't get. was within criticism of mccain-feingold including the amendment that they could raise extra if they ere running against a millionaire who was challenging them and using his own money. ut it is usually self-interest that appeals. and if there is a big scandal and both sides want to do system.g to fix the host: for more go to sunlight.com. editorial director

thank you. news t to share breaking from the associated press. we asked you earlier about talks resumingce in washington. we are learning from the a.p. is planningnt obama to meet with the israeli and phre at the n negotiators white house and we expect john kerry to make comments to the media. website and find out about our coverage there. he house is coming in at noon today so we will bring you to the senate armed services committee where a hearing is under one to head up the strategic command and the other two had the united states forces in south korea. two had the united states forces in south korea. have thef you confirmation hearings and it's hard to get answers when they have not pursued that position. you have a background in