one of the reasons i had to do that was because of health care costs. the challenge that you have, which i have seen with local manufacturers, is that you said you export products to china, right? i like you a lot. when you come the globally, you're competing against countries in europe and asia and across the globe, right? many of those countries have health care systems. many of those countries have much lower health care costs, right? [indiscernible] system, butf the their taxes are 15%, our taxes are 40-something percent. >> i want to compete with everyone but toronto.

my point here is that your pragmatism i love. this is not the pugilisms or that is prodigious in washington. it is about solving problems, lowering costs, giving access to small business people like you who want to compete with the big boys. when it's in my city is that many folks have a hard time keeping employees who could easily go to other companies who have better health insurance plans. you probably know people who could go to other companies and get less salary for better health insurance is that correct? >> i think that is one of our positive attributes. >> the goal here is to make sure we take this variable, which is made small businesses get crushed in the past. call it socialism or whatever you want, the other countries

have costs that you internalize. we're not here to score political points. i don't care about the next election, i care about solving the problems. most people are saying right now fix the thing, which is what you're saying, right? hickey, who has no jersey connection, i'm sorry, sir. you do. you are well down the field. you are a functioning exchange. and mr.d mr. greenblatt allen's problems. could you please tell us what the future could look like for them and how to solve their very real problems? >> number one, put together and exchange board that is from both sides of the aisle, but, as you say, they care about the people of new jersey. our board -- >> i'm sorry to interrupt you.

our governor is very quiet and soft-spoken. he did not participate in the exchanges. we have one of the best local insurance waste knowledge there is and we didn't engage in that. we are way behind you in kentucky. please continue. >> that board being made up of people, even though they were vitriolic against the aca. once they got on the board, they said we have an obligation, a fiduciary to the to the people of new mexico and we are going to make this work very >> right and left coming together. >> right. we have a great chairman, he is also a doctor. we met and we met and we resolve the issues and we hired an excellent ceo and we hired a the previouse private exchange administrator. we knew it would work. >> my time is expired.

we have to fixes before the next election. senator enzi. >> one of the reasons it included some things you would prefer not to have in it is that when the federal register is our list and says that there's going to be this huge cost and people losing their insurance even though the president has promised they can keep their insurance, your choices not to pick from the things that are in there, you have to reverse the whole which would've made it possible for people to keep their insurance if they like it. you also have a very limited time to be able to bring up the congressional review and have that kind of and eight our debate ended up in our -- and an up or down vote on a regulation. after that window closes the only people who can make the difference are through the

majority leader, which means that the majority side could have brought up things that would have left out the one or two things that were in that regulation that they didn't like. they could have made it so that people could keep their insurance if they liked it provided it didn't have those two things. that is not how it works and there hasn't been any effort in the meantime to do that. now there is a tremendous effort and interest. senator johnson has a bill that would comply with what the chairman said would be acceptable to go ahead and fix it so that people who like their insurance could keep it. it should have been done three years ago. insurance companies would've had the opportunity to adjust to the time to have their actuarial stuff together for this particular time. i think it would have helped out businesses. there are three changes i would like to make in obamacare and if we made the three changes it would make more of a difference in jobs and the economy than the

stimulus package did. one of those would be to change those hours for part-time from 30 to 40. that is the standard by the small business administration. this is the small business committee. i would hope that we would do that. plan for fixing health insurance before the president ever became a senator. one of the things and that was small business health plans and we had an opportunity to do that . that would allow small businesses to group together through their association, any association, across state lines, nationwide, so they would have a big enough group that they could effectively negotiate with any insurance company. there's another proposal that would have allowed them to self- insure on those big groups. those would have provided a lot of advantages for small business . those are not available. small business owners in wyoming

are asking me what can be done. wyoming didn't do an exchange. is the least populated state in the nation. it is less populated than the district of columbia and we have a lot of miles between places and we have extremely small towns. have two insurance companies that are interested in serving their. re. under prescription part d we only had two companies providing prescriptions until we did the description part d. one of the things that surprised companiesly 40 a one to do business in wyoming. what was the effect? the effect drop vices by 25%. it gave people choices. we could have had that same thing here, but we don't. i want to thank you all for the testimony that you had. i have some specific questions that i would ask just quickly. allen, you mentioned that

the drugs cost 52% more because of the namebrand requirement or it could you expand on that little more? presently ise have only generic drugs. the difference in premiums for the new policy that includes the brand name drugs, there efforts in the premium is 52.3%. >> i think you said that none of your employees were using brand- is correct.ucc sometimes he could use a little bit of stability on what

his prices are going to be. he's not getting that under the exchange. i thank the chair. >> i think the senator from wyoming. senator shaheen who also comes from a small state. 576 thousand people in wyoming, population in d.c.. one shows exchange one did not heard >> thank you very much, chair landrieu. thank you all for being here. i'm sorry i missed your spoken testimony this morning. i do think it is very important for all of us to hear from small businesses. in new hampshire 96% of our employers are small businesses. it is the foundation of our economy. the frustrations that you have shared are ones that i think everybody on this panel appreciates and shares in terms of how to make this law work and what you would do better.

biggest concerns that heard from new hampshire small businesses is about the cost of health care. mr. greenblatt, you and senator booker engaged back and forth on that this morning. but small businesses in new more thanpay 18% large businesses because of the administrative costs. way to address the challenges that you face is going to be critical. looking at what we can do to fix legislation i think is very important. in that vein i have offered a bill that would delay open roman in the individual market because that is immediate problem we are facing in new hampshire. we want tobecause make sure that people have time to enroll. now with the shop exchanges that is an ongoing opportunity. wyoming,hire, like like a number of other states,

also has not chosen to do a state exchange. so we are very much struggling with what is happening at the federal level. , as you have participated in state exchanges that are working, if you could talk about the reaction of those businesses that enrolled in the shop exchanges in the district of columbia and kentucky and how they are feeling at this point about the product that they are getting. go knowles, maybe you would first. the shop exchange is really a two-step process. the first step is the employer themselves will come to the exchange and shop them try to explain which plans they want to

offer to their employees. once a go through that process and pick the plans that they then theffer, employees are given a 30 day open enrollment opportunity to go online and pick the one they want. longer in thetle shop to really get to the point where you are actually enrolling. that process has to become tweeted. the open enrollment. for employees has to be completed. we have a participation requirement in kentucky that says that 75% of the employees have to participate. -- that takes time. we have gotten to the point where now employers have selected plans and the open enrollment. is ongoing.

employees can come in and choose and then -- what i'm trying to say is that it is difficult to say about this is all going to happen. it is predicting the future. we are very encouraged about the numbers. we have had over 93 employers that have gotten to the point where their employees are not picking plans. >> great. d. >> you, mr. nol [indiscernible] business is growing. this is the first time they can offer coverage to their workers and themselves. if their workers uncovered, it is likely the owner is not covered either. one small business was very excited about that. another small business i spoke to on october 1 said based on his quick review of all the

, atucts, he will save 12% least 12%. at that time he has not made a decision of the products he wanted to offer. the small business i spoke to said they were very happy not to be paternalistic any longer. they can just decide how much to contribute and let their employees decide which hmo or ppo or insurance company to select. anecdotally, small businesses i talked to have been very pleased with the product offerings, the range of offerings and the prices. very much.u senator johnson, thank you for joining us. >> in solving any problem in negotiation, the first thing you have to do is figure out what you can agree on. there are a couple things i can agree on right away, madam chair. we need to fix this bill. there's a lot to fix. in your opening statement it sounds like you're giving the

states a lot of credit. we are having the problems on a federal level. the federal level as no capability of doing this. the states are far better places to start solving these problems. d, did kentucky need this massive bill to do small could youxchange e ? >> did you need a 1600 page bill to do this in new mexico? we didn't need a federal solution, did we? i think small business exchange is a good idea. >> and we had a very supportive

republican governor and a democratic legislature and they compromised on this bill and we moved out of the gate. >> to paraphrase senator booker, this is an about politics. it is about solutions. say it is about recognizing reality and telling the truth. the fact of the matter is the american people have not been told the truth. let's talk about cost. we were guaranteed the cost for the average family plan would be reduced to $2500 for year. you have the exact experience. if you have a health care plan patientadd ambulatory services, zachary to increase the cost but decrease it? >> if i have one now? it will increase. addr. hickey, if you

emergency hospital services to that would increase the cost of decreased it. it? will generally increase the cost, but the state, again coming back to the state, the state has the authority under the federal bill to decide what essential benefits were going to be covered. >> i'm just talking about the truth of what promises were made. we were promised that the health care law would decrease costs. but all the added costs and coverage is at mandates have increased costs, correct? >> if i could point out to you that 25% of the premium that you pay today goes to cover the . that is the opportunity to lower the costs. >> please let him answer.

senator johnson, please let him answer. >> i do want to talk about the other totally broken promise. the fraud, the massive fraud. appreciate what center and is he said. i appreciate managers attempt, but her bill only covers those individuals participating in the individual market where we are going to see, i believe, because of those increases in costs, 49% -52% increase. we're going to see a massive loss of employer-sponsored coverage coming next year. i was certainly encouraged the man on the chair to take a look at my bill which is inclusive which is not as onerous on forcing insurance companies to do what they do not want to do because of state regulators.

i would love to start working with you folks to give americans give them the ability to choose a health care classic and afford that they actually want. thank you, madam chair. bill cuts the affordable care act, minor fixes it. first of all, i want to give a quick update at one of our last earrings about obamacare and small business. we had a very compelling witness from louisiana, the owner of dots diner. unfortunately, it is gone from he wasworse due to forced to cancel policies he before, in particular so that many of his employees could still be eligible for a subsidy on the exchange.

now he followed the law by giving a 90 day notice and he also asked and hired a consultant to come in to help his employees with the obamacare exchange application. however, all the website problems are pretty much shut down their ability to purchase insurance on the federal exchange for now. the consultant is next coming in december 1 which gives them two weeks to enroll. individualoyees with market they will see an average premium increase of 54%. if they can't get plans on the exchange there will be 30 individuals who were previously happy with their employer-based coverage who won't have any coverage. that is very real world, but unfortunate up date. questions, ms. kaufman i want to ask you if you , particularly based on congress

and congressional staff going to the d.c. shop exchange under this special rule for congress. are there more than 50 members thatngress for employees will procure insurance on this ?? i am sorryhange e > that is protected information and i am not able to share with you any specific details about congressional enrollment. congress,he size of 530 five members, and the size of their employee base, would you expect that number to be more than 50? >> more than 50 people enrolling? >> yes, that is correct. the provision under the affordable care act that speaks about congressional enrollment essentially overrides the small howness size and that is

you are able to avail yourself of the same choices that small businesses have in the district. correct, is there any other large employer, meaning over 50, as?gets the same treatment the congressional provision only applies to congress. >> forget about the congressional provision, right 2013 limited 2014, is are any of the large employer who has an opportunity to go to the d.c. shop exchange? made ahe city we decision to limit the size of the small business market to up to 50 workers. >> so congress is the only large employer gets that special treatment? of one of theon provisions in the affordable care act.

>> is there any large employer outgets this huge subsidy above the normal income-based subsidies of obamacare in that exchange e >> a small businesses , a medic andct should be to hundred percent to the program. small businesses, especially nonprofit and the district provide platinum plus level of coverage to their workers and contribute 100% toward the premiums. they do better than congress. care has aama distinction between under 50 and over 50. other any employers that go there and contribute this big subsidy? >> in the district, we do not

allow larger employers to come in. in 2016, larger in players up to indred can come in starting 2016. then there'll be a policy decision for the district whether or not to expand the d.c. health link to a larger sized employer. >> what in your opinion justifies is completely different and better treatment for congress? congress gets the same treatment as all small businesses in the district did you have the same -- >> congress is not a small business. it is not under 50 employees. >> so by going through d.c. health plan you get access to everything that small businesses in the district get. .> the time is up me answer that question. the federal government is not a small business. the federal government is a large business and the federal

, postalnt, congress workers, as you know very well because you have studied this issue very well, this is under the same as large businesses in america. that insurance premium is shared between the worker and the government. their employer. that is not the subject of this hearing. you have ample time to debate that on the floor, so if you don't mind let's take that debate to the floor. >> madam chair, can i briefly respond? >> i will give you 20 seconds to respond. you have had a lot of time in the floor this issue. ms. kaufman does not have the time. >> you're right that congress is not a small business. it is a large employer and it is treated completely differently than any other large employer. and far better by being able to

go to this exchange only large employer that is allowed to do that. by being able to get a huge employeronly large that is able to do that for this time. your bill passes the only large employer that would not deal to get insurance for you and your staff. iq all very much. i really appreciate it. it has been an excellent hearing. >> on the next "washington we look at president obama's approval numbers. then the washington examiner senior political analyst michael barone talks about his book "shaping our nation. " he compares the health exchanges with those he created in massachusetts in 2006. atshington journal" is live

7 a.m. eastern. >> this week on newsmakers, texas representative mac thornberry is leading an effort -- he talked about u.s. forces in afghanistan, military militaryand information gathering practices. here's part of the interview. >> a key part of what the u.s. intelligence community does is cooperate with intelligence agencies of its allies. -- with what wikileaks is brought out, will any of those allies ever again the unitedith states? >> i don't know. if i were they, i would have to wonder about it. it is deeply disturbing. as i was just saying, we have

very limited resources. a key fact or in our success has been working with others and cooperating and coordinating our efforts. if folks think that anything they said to us is going to be leaked out in some way, they're going to cooperate less. who would blame them? i would say that is one of the consequences to these recently. -- the white house is replacing considering the nsa director keith alexander when he retires in this ring. to think it is a good idea for civilian to be in charge of the agency? >> this is one of those questions where i think you should not have a knee-jerk reaction. you are to sit back and study it the relationship between nsa and cyber command and the leadership of those entities. in last year's defense bill we

required a study of justice issues and what that relationship would be and what sort of leadership would make the most sense. looking at the pros and cons of separating them out, leaving them together, etc., we have not got the results of that study at. the social things are not just about responding to last week's headlines. they have major consequences for our ability to protect our people from all sorts of threats. that is a reason i think we have to do it in a deliberate way, looking at the pros and cons, not in the heat of the moment but with our cool best judgment. >> i thought it was fun to have a little view of history of the

time in america that was an instructional. was a little more anecdotal and actually a little more archaeological, meaning random. you take a look at them and you see bunches of weird photos and then the captions explain them. you had a vision of high school students flipping through them and loving history if they flipped through it. josh sapan on tonight's q and a. >> republican governor chris christie of new jersey has criticized both parties in washington for failing to lead. he talked about that failing at an event hosted by the "wall street journal." this is about 40 minutes.

>> governor, thank you very much indeed for being with us. you squeaked home. a bit of a close election. you were not quite at the 60% threshold for a wailing. -- four a while. >> i am a republican in new jersey. i am just worried right getting over the finish line. it was gratifying. >> what was striking was to look at the detail of the exit polls. you won 50% of the latino vote, over 25% of the black vote, running against a woman democratic candidate. all in a state where president obama won 50% of the vote a year -- 58% of the vote a year ago. ago. a lot of questions about the future of the future of the republican party. how did you do it? >> reversing as you do your job. i often think people make political leadership to

complicated. leadership to consultative. what people expect you to do is do your job. first and foremost. the folks in new jersey, republican, democrat, independent, felt as if we had done our job. second thing, if you want to reach out to constituencies that have not normally voted for your party, you can't go six months before the election. we made a concerted effort from the time i got into office, we only got 30% of the latino vote in 2009. about 7% of the african-american vote in 2009. my view was that was nowhere near good enough. so we started working with those groups, giving them a serious seat at the table, knowing that they were not always going to agree with my policies but that they would be listened to. i think that was a very important part of the victory as well. campaigns still do matter.

so i was fortunate to have a really great campaign team that worked with me so the last five years, so they knew me. these are not folks who parachuted in from washington or someplace else with their own ideas about things. they knew me, my voice, what i would and would not be willing to do. >> you have become a national figure in the last four years. tell us what you think you did that was most effective? not just in terms of being reelected, but in terms of changing the political or economic trajectory new jersey was on. you did a number of things on taxes and public-sector unions. what is the most important thing you have achieved so far? >> i couldn't point to any one particular achievement that was most important. yes, we cut business taxes by $2.3 billion. we reformed the pension and benefit system to save $120 billion over the next 30 years. all in the face of stiff public- sector union opposition. the most important thing we did

was change the conversation. so many of these things were considered givens in new jersey, that could not be changed. our position was, i'm a republican in new jersey, playing with house money. i am not supposed to be there, not supposed to be alive. the fact is, if you get elected in that context then you have two choices. you can try to figure out how to play everything perfectly from the conventional wisdom perspective, or you just say, the hell with that, i'm doing it my way. either it will work or it will not. if it does, i have a chance to win. if it doesn't, i lose. we changed the conversation. at the beginning, we took on the teachers union. the teachers union is the most powerful union in our state, private or public. they have 200,000 members in new jersey, and they get annual dues

of $140 million. from those, they do not pay teacher salaries, pension, or health. essentially it is a slush fund to reward friends and punish enemies. so we took them on early. i think they never expected us to do that. and the public reacted extraordinarily well. i think that was really the moment that changed the conversation in new jersey and made a lot of the things we did possible. we showed we were willing to take on the biggest bully in the schoolyard. >> is there a national lesson from that? who are the national equivalents of the new jersey teachers union? >> the national teachers union. [laughter] it is not hard. really, -- >> that is hard for a president, isn't it? i'm jumping ahead of myself.

because teachers are organized on a local basis and paid by local authorities. >> yes, but you are talking about setting a tone. you have to point out to people, as rupert mentioned in his remarks, the education system in our country, while there are successes, is in the main failing many, many millions of families. anyone of these ceo's out here knows that the only way american companies or international companies working in america are going to continue to thrive is with an educated workforce. that doesn't start when you get to college. so, i think it is the defining issue of our time. what we are going to do with the education system in america. it used to define us as the best. it is now defining us is -- as mediocre.

>> is it producing better results already? >> in certain places, we are. other places, it is too soon to tell. for instance, look at the city of newark, our largest city. we pay $24,000 per pupil per year for public education. two years ago, the graduation rate was 23%. now, i don't know how you define failure. i think that's pretty good. in asbury park, where i held my election night celebrations, we pay $33,000 per pupil per year. -- $30,000 per pupil per year. two years ago, less than 50% of the young people who graduated from asbury park high school could read at the eighth-grade level. so, somehow with the teachers union -- this is a debate about whether that is failure or not. my opponent, who was endorsed by the teachers union, said that when it was pointed out to her we have 200 failing schools in

new jersey, her response was, that is not a bad percentage. they asked me for my response. my response was, that sounds like someone who never sent their children to one of those schools. if you sent your children to one of those schools, it is an obscenity. that is my difference between the republican view of what needs to be done with education in america and the democrat slash teachers union view, that the status quo is fine and we will get to fixing those places. if your child is in the classroom, eventually isn't good enough. >> you didn't change the economic performance much. the unemployment rate is still one of the highest in the nation. you haven't had a particularly strong recovery. other states have done better. why hasn't new jersey produced more jobs in the last four years?

>> tell those critics to come to jersey and attempt to turn around the queen mary in the delaware river. the fact was, we were the highest-taxed state in america when i took over as governor. we were rated the state with the least business friendliness in america. we raised taxes and fees 115 times in eight years at the state level. you are not going to turn that around in four years completely. but what we have done is cut , business taxes by 2.3 billion dollars, cut regulations by over where they were in the corzine yurok, and create private sector jobs. in the last year, from august 12 august 13, new jersey ranked in the top 15 in the country. it will take us longer, because we were in the deepest of deep holes in a state that had followed a liberal democrat doctrine for a decade of there is no tax you can't raise or create and you can't raise it high enough to drive people out of your state.

boston college did a study that between 2004 and 2008, in the heart of democratic governance, $70 billion in wealth left our state. you don't recover from that like that. it is going to take a while. look at your numbers, i think they will continue in the trajectory they're going in now. >> you expect a real economic dividends in the next couple years? >> i do. you can't -- everything is relative, but i do expect us to continue to be more competitive. for instance, a state like new york is moving in the wrong direction. you see taxes being increased, a new mayor in new york who is aggressively talking about increasing taxes in new york city. i feel badly for new yorkers. come to new jersey. [laughter] you know it is moving in the other direction. >> but not to the tunnel you decided not to build. >> that tunnel would have never been built, whether i decided to build it or not.

this is what new jerseyans hate the most. want to be popular in new jersey? cancel the tunnel between new jersey and new york. one, because it is the smart thing to do. secondly, the deal negotiated by jon corzine, a wizard of business, apparently, was that well, it is true. you may not like it, but it is true. his subsequent performance has shown that as well. after he left the governorship. the fact is -- hard truths need to be told. the fact is, the negotiation he made with the federal government was that new jersey would contribute about $3 billion to this project and would be responsible for every nickel of the cost overruns. new york city, zero.

new york state, zero. for a tunnel that will take people predominantly to new york. this was not going to go to penn station, where people could get on subsequent mass transit to go to other places in the city. this was going to the basement of macy's. six stories below macy's, a $1 billion terminal. >> miracle on 34th street. >> the miracle would have been if it happened. folks say to me, why did you cancel it? my answer is, why the hell would i ever build it? we would be responsible for every nickel of cost overruns in a federal transportation project. nothing to worry about, right? talk to our friends in boston who went through the big dig. this was the single largest federal transportation budget that would ever be built. i canceled it because it was a bad deal for the people of new jersey. there is nothing they are more

suspicious of than getting stuck with it by new york. >> that is a good opportunity to talk about national issues. on your election night, in your victory speech he talked about what you achieved in trenton. working across the aisle, achieving political consensus. there were lessons there for washington. what are the lessons for washington? what is wrong right now in washington? that is a long list, so don't go through all of it, but tell me what you would change in washington right now. >> the people. predominantly. >> in both parties? >> sure. both parties have equal blame in what is going on here. listen, i have a completely democratic legislature in new jersey. it is not like it is close, everybody. this is strongly democrat. how do we get pension reform, how do we cap property taxes, cut business taxes?

how do you do all the things that don't appear to be traditional democratic things with a democratic legislature? it is about human relationships. the fact of the matter is, nobody in this city talks to each other anymore. if they do, they don't speak to each other civilly. they don't develop relationships, don't develop any sense of trust between each other. then they expect from the kinds of problems you talked about,, big, difficult, contentious problems, that they will be able to get into a room and fix it. >> who do you blame for that? >> first and foremost, the president. if you are the executive, you're in charge of making that happen. if i wait for the state legislature to come to me, i would be waiting forever. they are legislators. they are elected not to lead. [laughter] that is it. members of congress, members of the state legislature, they don't have a responsibility to lead. they always have an excuse. if you let them. the executive is the person held

responsible. first and foremost, the president -- this is no newsflash to anybody -- he has not developed relationships necessary on a personal level with both sides of the aisle, both sides of the aisle, to be able to bring people to the white house and be a consensus- builder to drive the course. i was watching one of the numerous specials on the assassination of president kennedy. there was one particular piece on the warren commission. they played a tape of president johnson on the phone with richard russell, who said, i don't want to be on the commission because i can't stand earl warren. johnson said, you know, i don't take no for an answer. too bad, it has already been announced. what did russell do? he served.

that is because he knew johnson. johnson knew him. in the end, when i develop these relationships over time, you compromise at times, you don't walk away with everything you want. but if i walk away with 70% of my agenda, new jersey is 70% better than it would have been otherwise. what we have in washington, on both sides of the aisle, absolutists. >> a month or so ago we went through the government shutdown. you have criticized the president, but you have been critical of your own party, too. who was to blame, and what are the lessons you think should be learned? >> both sides were to blame. it was a train wreck everybody saw coming for months. where was the president? he knew this, everybody knew the dates. it wasn't like, i forgot my calendar, i didn't know this was coming. everybody knew this was happening. and i think there were a number of people in congress on the republican side of the aisle who just did not have an endgame.

>> are we talking about ted cruz? >> i get myself in enough trouble without your help. [laughter] >> the strategy of defunding obamacare as a condition for keeping the government open. it was a bad one, is that what you are saying? >> obamacare is still currently being funded and the government is reopened. maybe i am too simple, but it appears to me the strategy of defunding it by closing the government failed. some people believe it was the right thing to do. that's fine. they can believe it was the right thing to do. you can rail against obamacare. you can refuse to run a state- based exchange because you know the whole process is a train wreck, as i have done in new jersey. but not subscribed to the notion that your job in running the government is to close it.

your job in running the government is to run it and run it efficiently. all the people down here, from the president to the leadership in congress who engaged in this, failed by definition. why are people more appreciative of what is going on in states? we are actually doing our jobs. >> do you think obamacare can survive this mess it is in right now? does it have to be scrapped? >> obamacare is a failure, it has always been a failure, and it will not succeed. it just won't. >> how would you replace it? >> i am not going to go through an issue like that with 16:26 to go. >> you can have 14:00 to do that. >> that is the problem. as all due respect, that is part of the problem with the culture here.

somebody thinks i can solve obamacare in 14 minutes. solve the health care crisis in 14 minutes. and i have 30 seconds on iran and 22 seconds on syria. we will solve the whole thing. carve it up. these are complex problems, and people are tired of these focus group-tested, below-dried answers people give that all sound the same. somebody asked me during the campaign, why is it you get so much attention? i said, unlike most politicians i don't sound like charlie brown's teacher. it all sounds the same. it is the most extraordinary overreach of government power in the history of our country. it is being run by people who never ran anything. so why are we surprised it is

failing? it is failing because the people in charge have never run anything in their lives, and even if they knew how to run things this would be hard to run because it is an extraordinary overreached, taking over 1/7 of the entire economy. we need to replace it. we need a robust debate on both sides. unlike last time when the president jammed this down everybody's throat and got one republican vote because he was unable to compromise. we need copper mines were everybody brings skin to the table and everybody compromises. if we do that, we can craft a solution. if we don't, we will continue to have this failure. >> it seems objectively obvious that to defund obamacare and shut down the government strategy failed abjectly. how did the gop get itself in a position where it was associated with that for such a long time? how did that happen? >> bad decision-making.

a lack of courage. that is really at. we all saw it on display. the fact is the democrats were as guilty. harry reid played the same kind of games. we are not going to fund this, funds that, even though they believe in funding those things. he was going to do it because it was good public policy to close all the monuments in town? good public policy not to fund the military in the places it should be funded? of course not. if you ask what was good public policy, he would not answer. he would pivot to the are

publicans are the cause of the problem. come on. he did not do that because he saw political advantage not doing that. i am fine with the republican party taking their share of the blame. i am not fine with the republican party taking all the blame. harry reid and nancy pelosi played as many games as the folks on the republican side. so we need to drop down some of the partisan cloak here and say, both sides fail here. we have an enormous failure of executive leadership by a president that seemed unwilling or unable or uninterested in being engaged. >> you are just about to take over the chairmanship of the republican governors association. 30 republican governors across the country. how are you going to use your platform? >> elect republican governors. >> how do you do that? >> my job is to make sure they have the resources they need to tell that story, and also to hopefully give them strategic advice on the best way to reach out and broaden the reach of their base of voters in this state. in the 14 other states where there are democratic incumbents or open seats, it will be my job to identify talented challengers to come in and challenge in those states to make sure they are funded and help them with strategy as well. but my job is to be supportive of those 36 races. to make the strategic choices

about where we should invest the most money to yield the greatest success. it is not a whole lot more

consultative than that. >> you will be spending time in iowa. >> there is a republican incumbent governor who is the longest-serving governor in american history. in new hampshire, we have a incumbent democrat governor. i will also be in places like texas, where governor perry is retiring and we have a really dynamic candidate in the attorney general there. i will also be in states like south carolina and pennsylvania and ohio and florida, michigan, arkansas. all over the country raising money and trying to help folks raise their identity level with the voters. if we have a chance to tell a story, we will do quite well. we have 30 republican governors now out of 50. >> a lot of people were keen on we have been doing well. you to run for president in 2012. you turned down the opportunity. when the make up your mind about 2016? >> don't know. depends on what the politics of the world are like them. >> is there any other republican candidate you could get behind? >> there's a number of people who would make good presidents. whether i would support them depends on the politics of the time and how they continue to develop. this is a long way away. we are three years away from the

presidential elections. in this sense, i feel badly for president obama. he just won a year ago, and everybody is like, "who's next?" there is as we shoved him out work to as we shoved him out be done in this country. the door we minimize his ability to be an effective executive. we shouldn't do that. i am not rushing. i have work to do. i just got reelected governor. i have an agenda i want to pursue in the next two years. i will make that decision when i have to. i was direct with the people of my state. people confronted me, my opponent frequently in debates, are you going to serve a full term? i don't know. if i decide to run for president and win, i won't. if i don't, i won't. i don't have to make that decision now. people who run companies know this. when you make decisions before it is the right time to make them, you increase geometrically

the chance to screw that decision up. not something i want to screw up. >> you speak very directly, unusually for a politician. >> thank you. >> you have spoken very directly about some republicans. you hinted at it tonight. there are people in the republican party who think you have been to direct and two too direct andn two critical of republicans, and it does not play well. they also don't like the fact you seem to have a warm relationship with president obama. i year ago, hurricane sandy, the work you did there. have you some work to do with the republican base to reassure them you are a good, solid, reliable republican? >> how outrageous. your state has been hit by the worst storm in its history and the head of the federal government comes to help. and when he does a couple things right, you say he did a couple things right. it is the most outrageous bit of heresy. it is ridiculous.

the fact is i speak candidly , about everyone. when the president does something worth praising, i will praise him. when he does something worth damning, i will damn him. i will not make that decision based upon my party. i think most republicans, except for a few who like to see themselves on television, understand that what you expect of a elected official first and foremost -- the second thing you expect is performance. the people of new jersey judge d me on honesty and performance, and we got 61% of the vote. some republicans think i must not be conservative. how could a conservative win there? this is completely crazy to me. among these elements, the better you do, the more voters you attract, the more diverse voters you attract, the more suspect you are.

well there is a winning formula. , let me tell you. [laughter] there is a winning formula. so no, i don't feel like i have any fence-mending to do. i'm going to be me. if i ever decide to run for anything again, it being me -- is being me isn't good me isn't good enough, fine, i will go home. this is in my whole life. my mother used to say to me all the time, to me and my younger siblings, my brother and sister, be yourself, because then tomorrow you don't have to worry about trying to remember who you were trying to be yesterday. you never have to worry about that with me. i will never have to worry about remembering what i said during the debate. if that is good enough for me, that is great. it was good enough for new jersey two weeks ago. if it is not good enough in any other election i might someday pursue, i will find some work. >> we have some minutes for questions from the floor. you have a very outspoken and directly speaking governor

speaking to you. anybody wants to ask any questions? there will be some microphones around. >> nobody raising their hands, brings to mind to me, i have a monthly radio call-in show called "ask the governor." in the first year it was pretty contentious. one of my friends said i should rename the program "ask the governor, call if you dare." >> how is that for an invitation? let me ask you a bit about the campaign last year, the presidential campaign, mitt romney. according to some published reports recently, they considered you very carefully for the vice presidential slot. i am not sure how carefully you considered being the running mate. they raise some questions about your background, about some ethical questions about your time as u.s. attorney, related to your brother.

you are going to get a lot of scrutiny over the next few years, whether you run or not. the press is going to be examining you carefully. the romney campaign, according to accounts published in this book that was published recently, did not get satisfactory answers. >> it is simply not true. all you have to do is listen to mitt romney. he is the only guy who got to make the decision. what governor romney has said publicly since the book came out let's face it about this book, this book is a book where these two authors trawl at the lower levels of campaigns to get gossip which they then put between two hardcovers, and all of a sudden because they put it between two hardcovers it becomes authoritative. the fact is the authoritative , source for my betting is the vetting is the guy who

did it, mitt romney. he said there was nothing in the vetting that gave him any pause at all, nothing that had not been in the public realm, and it was not the reason he did not ask me to be vice president. i am pretty much content with that. as far as scrutiny goes, i am not worried about scrutiny. some will be fair, some will be unfair. if you are worried about that in this business, you don't belong in this business. host: they like your directness some of them. guest: the people? host: the press. guest: well, you have to ask them. i think we have a good relationship. if they ask good questions i give good answers and it usually makes good copy for them. and if they ask stupid questions i tell them they're stupid. and that's the relationship i ell every candidate.

>> i think the question should be broader and that is what does it take for a republican candidate to win. and we have to do better than we've done in the last two cycles. we have to reach out to others who have not voted for us and we had better be doing it now. the fact is our country is changing as it always does. and as it changes, people who first have to understand and then listen. leadership is just as much about listening as it is for talking. for a republican we can't get the percentages of the hispanic vote and the african american vote that we have gotten nationally and continue to think that we can continue to be a successful national party. and this isn't just about

policies. it's not. plenty of my policies that i pursued in new jersey that folks within those communities disagree with. yet they voted for me anyoneway. triple the number of voters we got in 2009. a majority 51% of hispanic voters. i think it is because they felt like they were included, that their opinions mattered, that i listened. and when i made decisions they didn't have to hear about it someplace else. they heard it from me. and we have to stop as a party going back to all the old tried and true ways of running these kind of campaigns. they're not working. and we need someone who is going to be clear, direct, auts tick, and say what they think. and if it's good enough it's good enough. and if it's not it's not. but changing things around, changing positions, trying to look into someone's eyes and saying what does he want to hear and then pray to god he never remembers that you

actually promised to do that because you have no intention, that's not the way to win. in the long term i think and build a movement. host: > one more question. when you were talkic about the affordable health care act you mentioned we had a government with people who did not know how to do things. have you given thought as president but how would you put a federal government of people who know how to do things? guest: i don't know because i've never been president but as governor i have people in my cabinet of both parties, i have people in my cabinet who i took out of private sector business and lured to come out my commissioner of transportation is a guy who ran private sector

business and is now running transportation sector and runs it like a business. i have other folks who have experience in human services who are not business people but have been career social workers who understand that world a lot better than i do. my general rule is that i want most people in the room with me to be smarter than me. my job is to make smart decisions. you listen to the folks you have around you, the cabinet that you build whether running corporation or a government

that is the hardest thing to find, in my experience. it is harder to find that than to find a whole bunch of people who know a lot more than me, are a lot more than me. that is not what i am hired for. the way you put together a group, you say, i want people who are experts in areas, who have practical experience. he goes were honest, who speak truth to power. he told who are willing to quit because they don't need this job. it is not their whole life. you put that group of people together, you will have a lot of heartburn over time, but you will also, i think, have the best chance to have the kind of information you need to make really good decisions. you have to be unafraid to decide. i think that is the format for any successful enterprise. i don't think government is any different. there are some competitions about folks who don't want to be in public life because of scrutiny and exposure. you will have to deal with that and try to be persuasive to

bring them around. but in the end is identifying talent. i police tell people, you can't teach smart and you can't teach loyal. you can teach everything else. when i became governor, i brought 27 assistant united states attorneys with me to government. 25 of them had no experience in government. zero. i had a bunch of people in trenton tell me, this is going to be a disaster. these people don't know how this town works. i said to all of them, you can't teach smart and you can't teach loyal. these are going to be smarter than anybody in the room and loyal to me. they know how i want things done. when there is no confusion about that, you got smarts of the people around you, they have loyalty to you and the mission you are attempting to accomplish, you can a company think. they didn't understand that we didn't care. we intended to change the way things worked.

we did. because of those people. their loyalty, their intellect, and their willingness to stand with me to get the mission completed. no matter what enterprise you are running, a fortune 500 company, the state government, the federal government, those are the elements to put together a successful operation. if you can hit those elements, you have a much better chance of being successful. if you can't, i believe you are doomed to failure. another thing that sounds relatively simple, because it is. it is relatively simple. when we try to aggrandize ourselves we make it more, located. >> ladies and gentlemen, you have heard some characteristically direct talk from governor christie tonight. please join me in thanking him very much for dipping of his time. national captioning

institute] national able satellite corp. 2013] >> well, general dempsey, thanks very much for joining us. you heard a lot about leadership in our last session. it seems to be the topic here in washington. everybody seems to be searching for it. we have a room full of ceos. they manage 5 million employees. you alone have 2 million in uniform. so i figured you do more

performance reviews than they do. we thought we'd come to you. so did chris christie get it right? it's smarts, loyalty and the people that you hire, and then the courage to make a decision? is that what leadership is? >> i think those attributes -- first of all, by the way, thanks for being here. congratulations for being here. it's an indicator that you actually want to think about something that ought to be all of our kind of our core if we're in those positions where we migrate to the top of our organizations. just the term "leadership" is actually quite exhilarating in some way, isn't it, and intimidating. but, yeah, sure, i think those attributes are right. there's others, and i -- he made mention, i think, of being true to yourself. there are other attributes i would add to the list. for example, how many of you know the name of the young man or woman who served your table tonight?

anybody know? anybody know who served your meal or poured you a glass of wine? it happened to be eunice at my table. from morocco, 29 years old. he pointed out to me morocco is the first nation in the world to recognize the united eights f america. so i think there's something for me in trying to get to know people and touch them at every level. it gets harder where you are, by the way. it gets harder where i am, but not impossible, and particularly in this age of social media and other things. so, you know, maybe a little humility doesn't hurt on occasion for a very senior leader. trust. i didn't hear the -- i think the governor alluded to trust, but for our profession trust is really the -- it's really the gold standard. you don't walk out of a forward operating base in afghanistan unless you have a certain level of trust for the men or women to your left or right, your leadership, your guidance, your

medics, your chaplain. and by the way, you mentioned 2 million men and women in uniform. it's probably 2.4 active, guard and reserve, but you add to that about 3 million family members who we also feel a responsibility for. >> so where does responsibility it into this equation? >> well, you know, i think it is -- if trust is kind of the gold standard of what it takes to be a real leader in the military, then i think responsibility and its kissing cousin, accountability, are probably right there as well. and, you know, we've had a few missteps here recently that we're trying to overcome -- missteps that i attribute to 10 ears of frenetic activity. we forgot about how we balance haracter and confidence. and i think we forgot a little about how we balance character and competence.

we began to value competence. by the way, you can't have either/or, actually. you know, you don't want a leader in a combat zone who's really a man of great character but can't fight his way out of a paper bag, but nor do you want, you know, the ultimate warrior god who isn't a man of character. >> so these are ceos of enterprises, of businesses. the military leads people into arm's way. but putting that distinction aside, are the attributes of a good leader roughly the same, or different between the military, being a ceo of a company, or being a schoolteacher? >> i think there is always a baseline of attributes that are xactly the same. i think probably -- i mean, i get asked all the time, why are you you? had we outsource you? sure, go ahead. you know, some days on capitol hill i'm absolutely ready to do that. but you know, i do think -- let me say this.

we are a profession, which is to say that we commit ourselves, what we like to believe, to an uncommon life. and we accept by becoming a member of a profession to live to a certain ethical -- an ethos, really. not just special skills and at least. it's also about a particular ethos. in our case, it's serving the people of the united states and ensuring the common defense, or in the way i describe it is keeping the country immune from oercion. but it is a profession, which requires certain things of us. continuing education, a renewable of our commitment to that. it is up or out. we are an up or out organization. and so i don't know how it all works inside of your businesses or your occupations. and some of you may actually describe yourself as a profession.

but the one thing i would tell you, and it has become apparent to me in my job, you are not a profession just because you say you are. you have to earn it and re-earn t. >> let's do a quick survey. how many ceo's in the audience have military service? >> happy veteran's month. >> what does that look to you? 11, so maybe 10% of the group ere. there was a recent study done by the university of texas. let me tell you what is said about ceo's that have military backgrounds. for those of you who don't, there will be waivers outside later on that you can pick up. this is out of the mccombs school of business. firms -- they look at ceo's to

have military background and ceo's who didn't. here is what they discovered the differences between the two. ceo's have a military -- with a military experience are less likely to be sued in class-action lawsuits, to backdate options, to engage in earnings management, the use tax havens. interestingly, they are also more likely to pay more tax. they have a 1% to 2% higher ffective tax rate. this academic reached the conclusion. i want to hear yours first. why is that? what is it about the military background that causes that evident behavior in a ceo? >> you are killing me. i mean, you want me to opine about why we're more ethical than they are, and they're out there? look at them. hey can hear us. you know, i don't know -- i don't know where the data comes

from. and by the way, you know, many of the most ethical, responsible, admirable men and women i've ever met are in sessions like this, who do so much for not only their own organizations but wounded warriors and gold star families and -- you know, i don't want to opine about what makes us different or what makes you different. i think it's more useful to us to see where we have common ground. and i think where we should -- and i think and i sense where we do -- have common ground is in caring about the future of our country. i mean, that's why you're here, i think, and why you're engaging with civilian, political and military leaders to figure out, what are we going to do? because, you know, the title here, "leadership in a dangerous world," that's really true. so i'm going to dodge that one. >> so while you're dodging, here's what the academic said

-- >> oh, here we go. >> -- "further validating our use of military experience as a proxy for respect for rules, authority and societal values." >> yeah. >> so they followed the rules. >> well, i like to think we follow the rules, but on occasion we don't. and when we don't, we hold people accountable. and, you know, remember i mentioned, though, we -- probably other than the medical profession, i think our continuing education program for leaders in the military is econd to none, really. and, you know, we -- as i said, we try to renew our commitment to being part of a profession at various intervals along the way. and then secondly, i do think there's something extraordinary about being given the responsibility for people's lives. that should cause us all pause and put everything else we do in perspective. and so i'll accept that part of our uniqueness, which gives us some balance in both physical courage and moral courage that

may be unique in our profession. >> so there were miscalculations in iraq and afghanistan. was that -- was that a failure of leadership or was that something else? >> you know, i -- we're -- the book hasn't yet been written, actually, and particularly in iraq, as you see them struggle with, you know, what we -- the opportunity we gave them. is it a failure of leadership? sure. i think, you know, at some -- at some level i think we have to look back and acknowledge what we -- what we didn't know and maybe should have before we took the precise actions we took. on the other hand, look, i mean, once we were engaged in it, the leadership demonstrated at every level, and in particular at the lower levels with those captains and sergeants and villages and towns and districts, and even today in afghanistan, where they are -- they've become so committed, so captured by the experience of trying to make the lives of iraqi children and

fghan children better. you know, even if they do make the odd misstep, it's pretty hard to be critical, for me, having seen the effort they've made. >> so you've written a great deal on this topic -- >> yeah. >> -- and have said that it's kind of critical to running the armed forces. and you said that you -- that you read a great deal on it as well. are there -- are there people who have written, on the topic of leadership, books that you look back on and say that this is really kind of worth sharing with others? are there two or three great writers on the subject? >> yeah, i -- you know, it's funny -- it's funny you used that phrase, is there -- are there two or three great writers? there's no shakespeare of leadership out there, as far as i -- as far as i've been able to tell. and so i read broadly, and i read voraciously, and i read both fiction and nonfiction. so -- by the way, some of the -- i think some of the better -- maybe the best books about

leadership available today are written for the business community, for developing leaders in business. and i mean, i could rattle them off, but i don't want to be accused of necessarily advocating any one in particular. but there are some good ones out there. and then on the -- >> rattle a couple off. >> well, i mean, i'm a big fan of "managing the" -- i don't want give you the authors, you'll have to google it, but you can. so "managing the unexpected" i found to be a -- you know, it left some echoes. and i read, by the way, to see if i can produce some echoes for myself later, when i confront issues. "starfish and the spider," about the difference between hierarchical and decentralized organizations. on the fiction side, i don't -- i don't think i've ever found a better work of fiction that describes leadership than "once an eagle" by anton myrer, about the world war -- the period between world war i and world war ii. so i think it's a matter of -- >> why is that? why that?

>> well, because the conceit that he sets up is comparing a leader -- he turns out to be a west pointer -- who -- which pains me -- turns out to be a west pointer in the book -- who, with all the advantages, begins to feel entitled about leadership, and he rises through the ranks. and then the parallel is a man named sam damon -- this guy's named courtney massengale, this guy's sam damon -- and he rises through the ranks from the enlisted ranks, battlefield commission, kind of struggles his way through, and watching him struggle his way through, and he makes some mistakes along the way and -- but his -- and learns from those mistakes and becomes the better of the two leaders, i think -- well, not "i think doug" he does become the better of the two leaders. >> so putting the policy issues aside in washington -- >> really? >> what's wrong -- what would you advise -- what is the leadership prescription that the players, the actors in

washington need now to get through the gridlock? >> well, first of all, because of my role within the administration and within the department, that's well beyond my responsibility. but if you're asking citizen dempsey, not general dempsey, i think that the issue of relationship-building is actually what seems to me to be the key to success. and i -- you know, governor christie talked about building relationships, reaching across the aisle, you know, doing things that will cause people to try to find some common -- some common ground. i don't know -- you know, i've spent most of my career outside of washington, so i can't speak, you know, with any -- with any clarity or nostalgia, as some do, about the old days. i suspect the old days were pretty much like these days, it just wasn't played out in the

social media and in 24/7 news coverage. but i do think that the key will be at some point when things are reach such a state that, you know, i think the nation will demand it. and i don't know when that occurs. >> we're not at that now with the government shutdown? >> i don't know. you know, i -- you know, i keep i keep an eye on my own force, those 2.4 million men and women, to make sure that they have the kind of clarity, as much clarity as we can give them, as much certainty. i tell people that, you know, we, the military, we actually -- we don't have a reputation for it, but we really do embrace change. we are nothing like the -- i joined the military in 1970 at west point, almost 40 years now, and the military i joined then is nothing, i mean nothing like the military today. in fact, the military we have today is nothing like it was in 2003, nothing. you -- i mean, you'll recognize unit insignias and patches and

some of the equipment, but it's a very different military. so what i tell people is, you know, we embrace change, but we do a considerable disservice to those young men and women who serve if we live in perpetual uncertainty. and we're living in a bit of what i would describe as perpetual uncertainty. >> karl eikenberry, former commander in afghanistan and also our former ambassador to afghanistan, wrote an op-ed in nother national newspaper -- we like to call it "brand x" -- saying that, look, if you examine the military culture now, as changed as it has over the last couple of decades, it's become increasingly divorced from the rest of society. saw 10 percent of people raise their hand here, 20 percent of congress has a military background. used to be in the mid-70s back in the mid-'70s. instead, what you have now is kind of a family business, what he called the military caste, the sons and daughters of those in the military, going into the

military, and the rest of citizenry says, you know, it's their job to go off and fight our wars. and from that, he argues, comes a lot of negative things, including misjudgments on the political side about what conflicts to get involved with. and he's suggesting a selective amount of drafting go on, targeting particular, you know, groups of highly able individuals to bring them into the military, to re-engage the citizen soldier. does that idea, to somebody who manages an all-volunteer army -- does that resonate at all? >> well, we haven't thought about it in those terms, although i did read that study and the suggestion, for example, by stan mcchrystal about universal service. and we are looking at the potential in the future of kind of lateral exit and re-entry, possibly. but to your point about selective service, i don't know how many of you are aware, but only one out of four young men and women in america between 18 and 22 can get in the united states military, one out of four. now, none of us should be very proud of that, but if you went

to a selective service, if you're not going to lower the standard, you're going to get about the same -- you're going to get about the same people you would get. i mean, one out of four isn't a huge population from which to draw. secondly, i did grow up in a draft army, my first -- well, i guess, five years or so, was in a conscript army. and there were some -- there were more holes in that selective service system than there were holes in a nice emmenthaler swiss cheese -- i'm sitting with a danish fellow here from -- who lived in germany. my point is, i would never sign up for any process that would lower our standards or that would -- that would be so hard to implement that -- and would have so many ways of avoiding service that we would end up with a lower-quality military. the reason i'm such an advocate of the professional all- volunteer force now is because that's what the nation needs. it needs a force that stays as well-trained as it can be

because the world doesn't hang around waiting for you to get -- you know, get your act together when something goes badly. >> you're not worried about what eikenberry was talking about, that it's gotten separated from the rest of citizenry of america? >> you know, do i worry about it? sure i do. in fact, i spend a lot of time another thing about -- by the way, another leader attribute i'd -- i would encourage you to consider is a -- i have a -- what i call a campaign of learning and a personal campaign of learning. i have a colonel that i hired who stays with me, and once a week for at least a two or three-hour block, he exposes -- he allows me to be exposed to business or industry or academia or something i don't know anything about. so i was out at a -- at a rapid prototyping center out in california last week. i was at goldman sachs the week before that; i was -- i may have visited some of you on occasion. but anyway, the point is, as i go around and connect with

people, there is a deep appreciation of military service, maybe not a deep understanding of it. but i'd rather strap on that as xxxx a challenge than change the nature of the all-volunteer force. >> so while you were out in california, you were also talking about changing the compensation program, possibly, for the military. >> right. >> there's the sequester, there's talk of general cuts in defense spending, and yet, you also describe this era as, while there aren't major conflicts, perhaps the most dangerous period in your lifetime in america, because of all sorts of non-state actors, as we've seen. so budget cuts and sequesters and compensation change is changing the military, and yet, that national security concerns that you have -- where are you going to lead the military? where do you want to take this organization while you're still chairman of the joint chiefs over the next five -- to build it out so that it's capable of

addressing those concerns over the next five to 10 years? >> yeah, i mean, this could take, you know, the next 20 minutes, not the next 9:32 here. but so i've got four focus areas i talk about: one, we got to achieve the national objectives we currently have established for ourselves: rebalancing to the pacific, finishing our work in afghanistan and -- i mean, you -- i could list those for you. secondly, it's -- i got to build joint force 2020. by the time i leave this job, we will have submitted four budgets, the last of which will cover the period fiscal years '16 to '20. so we're either going to back into '20 -- 2020 -- or we're going to shape it. and i'd rather shape it than back into it. and we can talk about what that force might need to look -- to look like. third, a recommitment to the profession: after 10 years of being extraordinarily busy and fighting two wars, it's time for us to be introspective about who we are as a -- and how do we connect with the

american people and how do we see ourselves? and then the third -- fourth one is keeping faith with american military -- the military family active, guard, reserve, families, veterans, gold star families and so forth. now, just one last -- one point about keeping faith, people sometimes think it's about making sure that i continue to argue for better pay, better compensation, better health care, better retirement. that's part of it, or at least adequate pay, compensation, health care and retirement. it's also about making sure they're well-trained, well-led and well-equipped. and if we don't get our manpower look, it's a bit of a business for me at my level. if i don't get the manpower costs under control then the institution will suffer irreparable harm in modernization, training and readiness. >> some of that instability and some of that concern, state and non-state actors, very much pertains to the mideast. >> yeah. >> and i'm wondering if you could kind of just walk us

through the big picture on the mideast. it seems that perhaps more unstable than ever. we have legacy in iraq of what looks to be kind of dissolution in some regards, iran's effort to get a nuclear weapon. syria demands and desires for the u.s. to have some kind of role there, we're just not sure how to untangle that role. and yet, at the same time, very firm commitments to an ally in the region, israel. the big picture on the forces that are shaping your decisions and your thinking on the mideast? >> yeah. so the middle east, and let me include in that probably north africa -- mideast, north africa. three things i would suggest to you. one is the -- a changed relationship between the governed and the governing. so what -- you know, i think books will be written for the next several years about what is this thing that we kind of optimistically described as the

arab spring several years ago. and it's many things, but it's certainly the relieving of pressure that was -- that was being brought to bear by dictators on societies that had that had been suppressed for many, many decades. and so you have a changed relationship between the governed and the governing among a populace that doesn't know what to do with it, frankly. and so i think it's a bit naïve to think that in the first generation of that change we would move somehow from dictatorship to -- you know, to democracy, certainly, but maybe not even all the way to representative government. >> blue thumbs of the first -- -- notwithstanding. >> yeah. yeah, i mean, look it's a step, but it's a step. so it's a changed relationship between the governed and the governing that i think will take, you know, a decade or more to finally settle. secondly, it's being played out in a -- in an environment where

there's a -- somewhat of an internal struggle within islam for control. and it gets at the sunni-shia schism -- it's a fault line. and right now, the fault line runs from beirut to damascus to baghdad. and players on both sides are trying to influence the actions in their favor. and then the third factor is -- what that creates is ungoverned space. or, if not ungoverned, governed less than we would like to be governed. and in that ungoverned space migrates extremists. so you've got this changed relationship between the governed and the governing, this internal conflict within islam in some cases which is more prominent than in others, but it's prominent throughout the region -- and then that arab spring was hijacked, in many ways, by these extremist organizations on both sides of that sunni-shia schism, and it

makes for a very volatile, complex, long-term challenge. >> what do we do -- >> i don't know. >> -- if the charm offensive of iran goes awry, israel wants to buy refueling planes from us, you know why -- >>yeah. >> what are our obligations to israel in the face of what still looks to be an intractable iran? >> well, i feel like we have a deep obligation to israel because of, i mean, a matter of history, but also a matter of what they bring to the region. you know, they bring an example of what could be. you know, if we had one of my israeli counterparts sitting here today, they would tell you that most of the arabs living in israel have a better life than the arabs living in the rest of the region. now, that's true -- >> but if israel loses faith in

the negotiation process and decides to bomb iran, where is the u.s. military? where's the u.s. in that equation? >> well, we have some -- we have some defined obligations to israel that we would meet. and that's why we're in constant constant -- contact and collaboration with them. but you know, my counterpart and i have talked about the fact that there's also a strategic opportunity for israel. there's no state right now that's threatening israel, as there was just 10 years ago. i mean, egypt's unstable, syria's unstable, jordan is struggling. so -- and not that jordan was a threat to israel in the first place, but the point is, israel's got a strategic opportunity, and i think they are beginning to think themselves about how to take advantage of it. >> you wrote a letter to carl levin, at his request, this summer outlining possible things that the military -- u.s. military could do to support rebels in syria. none of them looked like very good options.

have any of those options improved, in your mind? would you be able to find the right people to arm? would you have the confidence that the weapons weren't getting to the wrong people? >> well, even in that letter, the options were described as scalable, which is to say, you know, the top-end option, which would be if you wanted to topple the regime and do so through the imposition of a no-fly zone or seizing chemical weapons yourself, that's what got all the headlines. but any of those options is actually scalable. i worry that -- and have said so that we might have more confidence in our ability to limit conflict. you know, history's against those who think they can limit conflict. some of you may know that on the 10th of november, 1964, robert mcnamara declared that we would never send combat troops to vietnam. and i'm not sure how some of you think that worked out, but it wasn't one of the greatest

predictions ever made in the history of american statesmanship. >> right. >> so, look, my obligation is to articulate options and articulate risk. and then those who we elect make decisions about which options they're interested in based on the risks that we would accrue. are the options getting better? no, i don't think so. i think they're probably becoming more complex. but again, to my way of looking at it, that was absolutely predictable. >> abe in japan wants to change the constitution to be able to create a more robust military, presumably to offset a rising china. is that something that is -- you would endorse? would you see that as kind of a valuable development in asia, or is that just going to accelerate the existing arms race? >> no, i don't -- you know, it's to be determined, but i do think we have -- for some time, e have encouraged japan to

match its economic power that it brings to the international community and to the region with some extended military capability that could be integrated into regional architectures not to threaten any particular player in that part of the world, but rather, to make us a more capable alliance. and so -- >> are the territorial disagreements there manageable, or is this going to aggravate them? >> well, the territorial issues are manageable if all of the parties to them continue to behave as they are, which is to say, responsibly, mostly through law enforcement with he occasional misstep. but, you know, that's where we, i think, can provide our influence and our -- and our assistance in continuing to encourage a diplomatic solution.

and, you know, look, the chinese have a much different view of time than most anybody else, and i think, as long as we can continue to encourage both sides to be patient, i think there is a chance that over time, diplomacy might make a difference. >> so we have a few minutes for questions from the audience. yes, dan yergin, right ere. >> general dempsey, my question follows from a question that john just asked you about the middle east. >> and what? did i avoid it and you're re- engaging me or what? >> well, it's a kind of, fill in the footnotes here. >> ok. >> obviously, the u.s. energy position has changed dramatically in the last five years. does this -- and a lot of talk about whether this changes u.s. strategic interests -- is there any clarity in your mind yet as to whether it does and how it does or doesn't? >> i wouldn't describe my feelings about it as in any way

clarifying, although i will tell you that as we take a look at long-term -- probably beyond 020, we do think there will be there will be -- that our energy independence, if that's ever entirely possible, will change the dynamic in -- notably in the mideast, but also europe. probably not as much in the pacific, by the way, in our -- in our current assessment. in fact, i mentioned i was at goldman sachs last -- a week ago friday, and that was the topic. we had two topics. one was the future of energy security and the national security implications, and they're going to run a conference, by the way, in april. i'm not inviting you to it; i can't, but it -- they're asking some very good questions about what changes may accrue if nergy policy is changed to allow this breakout to occur. and then the other one was cyber, by the way. we had a pretty rich

conversation about cyber threats. >> yes, please. over here. >> general dempsey, question about -- it appears that with the amount of resources and energy we're spending in middle east that we're not getting as much financial benefit from it than some of the other allies who have spent far less or committed far less are getting, you know, better opportunities taking advantage of the financial arrangements and opportunities -- how do you see that? is that -- is that -- is that in line with your strategy or is that something that we need to rethink about going forward? >> yeah, it's pretty hard to answer that question. i think you've answered -- i think you've -- at least, you've shared your opinion with me on the answer to that question. yeah, look. i've seen it even in my own experience. i spent two full years, from '05 to '07, building the iraqi security forces with american taxpayer dollars, and then there was a point in time where

they went off to russia to procure some weapons on their own. you know, i think that we do better at that than you might think, not as well as you might like. and i think it's reflective of who we are as a nation that we don't hold people ransom to our assistance. and, you know, i'm more proud of that than i am disappointed in it, and i think it just takes some big, solid diplomacy to convince -- i mean, look. we've got some close allies who are considering procuring weapons systems that wouldn't be interoperable with us. by the way, that's the leverage we have. you normally can't appeal to them on the basis of good will. i've found that doesn't go very far. but if you can show them that by buying a different system they can't be interoperable with us, then generally they come around. >> yes, please. >> by the way, and the point is that most people actually do --

would rather be like us than anyone else. we're still the ally of choice across the world, and it's one of the things we should seek to preserve as we go forward. >> general, you observed that the military force today is nothing like it was in 2003. >> right. >> can you describe those differences? >> sure. i'll give you a couple of images, maybe. in 2003 i was a division commander in baghdad. i had roughly 32,000 troops there, kind of a traditional tank division with some appendages, some paratroopers and some military policemen and avalry scouts. and almost everything we did came through me. so if you were a young captain on the streets of baghdad in those days, you waited for the division staff to give you the

information you needed so that you could then apply yourself across the city. today -- so my -- the image here would be everything was top- down. anything of value to you came from the top down. we've almost flipped that on its head entirely. it's now most things of value come to us from the bottom up. and we've changed our systems in order to allow that, our communications systems. we've empowered -- you would describe it as empowering the edge. so a captain now, in a combat outpost in the pakistan border in afghanistan, probably has as much access to national-level intelligence and local intelligence as i did as a division commander. it's phenomenal, really. my worry, by the way, is we're going to bring that force back that has been -- you know, has been allowed to shape things and to be leaders and have both responsibility and authority, and we're going to bring them back. and if we don't find a way to

continue to inspire them, they're going to go work for you so i got to worry about that. >> another question? yes, please. >> hi, general. thanks for coming. we're convening a group tomorrow to talk about cybersecurity. how bad is it out there? >> you know, i've found that it's not helpful when the chairman uses words like "crisis" or "meat axe" or, you know, these really powerful djectives. but we are vulnerable, make no mistake about it. my job, by the way, through the cyber assets that i control, is to defend and protect my network, the military network. the problem is my military network depends on your network. so 90% of what we do is shared in the -- you know, across the internet with commercial. and as you know, there's some

problems with incentives for cybersecurity for information sharing that i think we have to break through. we're really vulnerable. and i would simply say to you, i know what we can do, and we're not -- this is back to governor christie -- we're not the only smart guys on the lanet. >> we haven't talked about afghanistan. so after 2014, can afghanistan live without isaf and the united states? >> after 2014, afghanistan can ive without a ubiquitous presence of u.s. military forces in their country. they can't live without any. and importantly, they can't live without the financial support that we've made both on the military side, but also at the in japan, at a donors conference, that the -- that we made to them economically. so the real question that i -- that we are grappling with is

what size -- you know, most people think, what size presence should the united states leave there in order to maintain security? that's actually, to me, the wrong question. it's what size force does the united states and the contributing nations need to leave there to guarantee that the money we've all committed to afghanistan will continue to flow, because if security deteriorates to a point where -- i think it's $6 billion a year or so has been committed to the economic side of afghanistan from the international donors. if that money dries up or if the money dries up that we're providing, along with donors, then they can't survive. this really comes down to what will it take to guarantee that the commitments we've made monetarily will continue to be realized. >> the defense department's identified china as a primary concern over the next generation. what in asia concerns you from a national security standpoint?

>> i would be -- so there's a couple things. one is, i worry more about a china that falters economically than i do about them building another aircraft carrier, to tell you the truth. i think we can find our way forward with them militarily. i don't think -- it will be competitive, and at times it will be contentious, but it doesn't have to be confrontational. so there's that aspect of it. and then you've got -- someone mentioned the territorial disputes. i -- you know, i think the potential for miscalculation is certainly there. and there's -- you know, you look back at history. miscalculations with major powers who are kind of emerging on the scene is normally a problem. and then i should have probably mentioned right from the start north korea, because north korea is the rogue nation, with some confidence, we believe, nuclear weapons, and the intent

to find a delivery mechanism that could reach out across the region and potentially to the united states. so i actually worry more about a provocation from korea that escalates than probably anything else that i deal with on a daily basis. >> that problem's not contained by china? >> china is -- i believe is working to influence. "contain" is a strong word. i think china is trying to influence the dprk into a more moderate behavior regionally. the problem of course is that they're still so opaque, the leader himself is so young and so inexperienced, and we have these cycles of provocation. we happen to be in a cycle, you know, where the provocations are absent right now, but we'll see.

you know, the -- if the provocations continue, the fear, of course, is that those being provoked, notably the republic of korea, will tire of being provoked, and it's a very dangerous -- it's still very dangerous there. >> general dempsey, thanks very much. please join me in thanking him. >> good evening. today you'd and -- to date united states took an important first step toward a comprehensive solution to addressing our concerns with the iranian nuclear program. i've made it clear my

determination to prevent iran from obtaining nuclear weapons. i have said many times my strong preference is to resolve this issue peacefully. we have extended the hand of diplomacy. for many years, and ron has been unwilling to meet its obligations to the international community. my administration work of congress, the united nations security council, and countries around the world to impose sanctions on the iranian government. the sanctions it had a substantial impact on the iranian economy. with the election of a new irani and president, i am hoping or diplomacy. i spoke personally with the president ever on this fall. secretary kerry met multiple times with the foreign minister. we have pursued intensive diplomacy with the irani and --iranians and with our partners and united kingdom, france, germany, russia.

today that diplomacy opened up a new path toward a world that is more secure. a future where we can verify that iran's nuclear program is eaceful. today's announcement is just the first step, but it achieves a for -- a great deal. for the first time in nearly a decade, we have halted progress of the irani and nuclear program. key part of the program will be rolled back. iran has committed to neutralizing part of its stockpile. iran cannot use its next-generation centrifuges, which are used for enriching uranium. iran cannot start up or install new centrifuges. its production of centrifuges will be limited. they will halt work at their plutonium reactor. sections will -- new inspections will provide access by the international community

to verify whether iran is keeping its commitments. these are substantial limitations which will help prevent iran from building a nuclear weapon. simply put, they cut up iran's most likely path to a bomb. this first step will create time and space over the next six months for more negotiations to fully address our copy had concerns about the iranian program. because of this agreement, iran cannot use negotiations as a cover court program. on our side, the united states and its allies have agreed to provide iran with modest relief. we will apply our cap the sanctions. we will and frame -- refrain from imposing new sanctions. we will allow the irani and government access to a portion of the revenue that they have been denied through sanctions. the brother architecture of sanctions will remain in place.

we will continue to enforce them vigorously. if iran does not fully meet its commitments during this phase, we will turn off the relief. we will ratchet up the pressure. over the next six months, we will work to negotiate a comprehensive solution. we approach these negotiations with a basic understanding. iran, like any nation, should be able to access useful nuclear energy. -- peaceful nuclear energy. but with its record of violating its obligations, it must accept strict limitations on its nuclear program that make it impossible to develop weapons. these negotiations, will not be agreed to and let everything is agreed to. the burden is on iran to prove to the world that its nuclear program will be exclusively for peaceful purposes. iran seizes this opportunity, the iranian people will benefit from rejoining the international community. we began -- we can begin to

chip away at the mistrust between our two nations. we can provide iran with the dignified path to forge a new getting with the wider world based on mutual respect. if on the other hand, iran refuses. they will face growing pressure and isolation. over the last few years, congress has been a key partner in imposing stations that sanctions on the iranian government. that is the rate bipartisan effort, and progress was achieved today. went forward, we will work closely with congress. however, now is not the time to move forward on new sanctions. doing so would derail this promising first step. it would alienate us from our allies and risk unraveling the coalition that enable our sanctions be enforced in the first place. that international unity is on display today. the world is united. we are supporting our determination to prevent iran from building a nuclear weapon. iran must know that security and prosperity will never come through the pursuit of nuclear

weapons. it must be reached through fully-verifiable agreements that make iran's pursuit of nuclear weapons impossible. as we go forward, to resolve -- the resolve of the united states will remain firm, as will our allies including israel and/or golf partners. they have good reason to be keptical about iran. ultimately only diplomacy can bring apart -- bring about a durable solution to the challenges posed by iran's nuclear program. as president and commander-in-chief, i will do what is necessary to prevent iran from obtaining nuclear weapons the top i have a profound responsibility to resolve our differences peacefully. today we have a real opportunity to achieve a comprehensive, peaceful settlement. i believe we must test that. the first step we have taken today marks the most significant and tangible progress that we have made with the ron's since i took office -- with a rotten since i took

office. we misuse the months ahead to pursue a lasting ettlement. it won't be easy, and huge challenges remain ahead. but through strong appraisal diplomacy, the united states of america will do our part on behalf of the world for greater peace, security, and cooperation among nations. thank you very much. >> next, live, your calls and comments on "washington journal." then "newsmakers" after that president obama honoring this year's recipients of the medal f freedom award. >> i thought it was fun to have a little

>> i thought it was fun to have a little view of history, of a time in america that wasn't instructional. that was a little more anecdotal and actually some weird photos and then the captions explain. >> josh say pan from the world of cable. tonight at eight on c-span's q&a. >> this morning on "washington looks at the senate's rule change and other items.

washington journal is next. >> these are substantial limitations which will prevent iraq from building -- iran from building a nuclear weapon. meanwhile, this first up will create time and space over the next six months for more negotiations to fully address our comprehensive concerns about iranian program. --ause of this agreement