. .

issues emerging in the fraud space. wednesday in washington, we will have our fourth quarterly talking about these issues. please see me if you are interested. to wrapt, we are going up. i would like to think our panel, it has been a wonderful discussion. [applause] to thank all of you, again, for coming to this event. thank you to our underwriters at google. we will see you another time, goodbye. a, next "washington journal,"

look at u.s. trade policy and proposed trade agreements with the european union and russia. our guest is sanford reback. we will speak with former , andor blanche lincoln robert weissman. airs liven journal" every morning at seven eastern on c-span. a couple live events today on c- span. the senate homeland security committee will hold a hearing on the navy yard shooting and security at federal buildings at 10:30. 2:00, a senate foreign relations subcommittee looks at the violence in central africa republic. today comesoing on

down to two words -- they are not my two words. fundamental transformation. obama's words. asked a couple questions. when you look at the constitution, does the president have the power to fundamentally transform america? of course not. why would you want to transform america, that means you do not like america -- capitalist, privateequity. -- property, our constitutional system. when you keep hearing fundamental transportation, this is ahard -- direct attack on our constitutional system. that is what he is talking about. >> sunday, january 5, best- selling author and radio personality mark levin takes

your calls and questions in depth. live for three hours starting at noon eastern. the tv's in death, the first sunday of every month on c- span2. -- book tv's in depth. we want to know what your favorite books were in 2013. go to book tv.org and click on book club. a discussion of the pending budget deal in the role of advocacy and fundraising groups from "washington journal," this is a little more than a half- hour. we are joined by christine hartman hansen, federal affairs manager for americans for prosperity. i want to talk about the budget widethat passed by a margin, americans for prosperity

oppose that. walk us through. one of the things that alarmed us about the budget deal was the overall spending levels. it is concerning to us that the overall spending levels exceed the budget authority for 2014, the level that was agreed to by theress, the president in budget control act of $967 billion. the spending level for the two- year agreement is about $1 trillion. in order to pay for that, the deal uses a number of revenue increases. no new taxes,des no unemployment extension, is that a win? >> the statement note new taxes is not in reality. the statement note new taxes is not in reality. it is really taxes in another name, and line fees and changes

to federal pensions. americans for prosperity supports changes to pensions but we disagree that they should be used to offset higher spending elsewhere. host: talking with christine of americans for prosperity. the number for republicans is (202) 585-3881, for democrats, (202) 585-3880, and for independents, (202) 585-3882. what is americans for prosperity doing to get a message out to lawmakers? we are voting against this budget deal as we voted against it in the house, letting members know that we're going to include this in our congressional record. another thing is -- we have over 2 million activists in all 50 states gue.st: the millions of --

have over 2g, we million activists in all 50 states. they are calling congress and letting them know that they opposed this budget deal. we are doing a number of things. host: people have made the case that without something like this we could see another shutdown like a 16 day struck down -- like the 16 days shutdown we saw. guest: that is a concern, our perspective is that it sets up a false choice. if the senate rejects this budget deal, the government is not going to shut down. we are operating on a continuing resolution that provides funds until mid-january. gives congresst time to come to an agreement on a clean continuing resolution at the appropriate lending levels 967 billion.

our first call comes from georgia, democrats line. is a division of republicans and conservatives. gettingthe economy is better right now. if they were putting in their saying no stop to everything, our economy would be way more better. they have been saying no for the last five years. it is sad. i am a black individual of 63 military andom the anything else, i have never seen anything happen like this. disrespecting the office of the presidency. says whenie rangel the guy who died said something

against our president, he stood up. we need to bring this country, stop having this division. this country is divided between politics. the tea party is dividing us. what nationality, between the blacks and hispanics. we do not need this division no more. it is time to put this stuff aside and accept people and love people to be the strong america that we can be. stop looking at the 47%. think about the 47%. those are the ones who still put food on the table. they are doing construction of the homes we are sitting in. their families are behind the walls. host: your response? take issue with the assumption that the economy is doing better. it is, but this is a recovery that is slower than others in

the past, historically. we seek millions of americans who continue to struggle to find work. we see millions of americans upset with the implementation of the president's health care law. these are issues that americans for prosperity here is at this state baselevel, we have 34 chapters in all 50 states. i talk with state directors and they tell me how fat up upivists are -- fed activists are about overspending. host: paul ryan was asked if he was fed up with negotiations. let's take a listen. [video clip] think these groups are valuable. the way i look at it is they are part of our conservative family. i prefer to keep these conversations within our family. john was frustrated because they agreementgainst our

before they read it. i see that he party as indispensable, and valuable in keeping the taxpayer in the game, keeping washington accountable. we deserved to lose our majority in 2006, they help us get our ship righted. of the housee 2/3 conservatives voting for this. it is a step in the right direction. host: your take? i appreciate chairman ryan for being more diplomatic than house speaker john boehner. my take is that our position has not changed. americans for prosperity has been very focused on the overall spending levels throughout this budget process. this is something we have been saying since the beginning of the year, we are very concerned about keeping the sequester. we are concerned about overspending in washington.

is something our activists are. another item, the fact that a lot of early reports and my conversations with capitol hill offices gave me a lot of clarity based on the details in the budget deal. it was correct that this budget trillion, ase to $1 two-year, $1 trillion agreement. our first key vote alert was correct. host: let's take a call from tennessee come a rainy on the democrats line. randy on theessee, democrats line. caller: a question, how many people out there that belong to this organization actually have a job and depend on the job? -- it is always ok for the bat,et taken off america is digging out as a

whole because of workers, let's take their pension and make them the bad guy. they will not even talk about some ofax loop holes, the corporations. taking taxes from them like they should be on closing loopholes. they will not discuss that. i am concerned about why we do not do that. i am part of the 99%, i am a retired construction worker of 40 years and i am barely getting by. on social security and my pension. contractsiate those for federal employees and they should be able to keep their pensions. host: your take? part: to address the first of the question, americans for prosperity activists are normal people. they are your neighbors. they live in all 50 states. they are hard-working americans. there he middle-class.

the states ato lot. i need with a lot of our state chapters. i chat with members and activists. the one thing they have in opposition to the president's health-care law, overspending out of washington. these are normal people, the 47% as you claim. these are not the 1%. the other thing i would like to address, the second point about carveouts. it has long been the position of americans for prosperity that we need to clean up our federal tax code that is too cluttered with carveouts and we have a recent blog post on our blog, americansforprosperity.org. you can see our policy position where we are calling for cleaning up the tax code and getting rid of targeted handouts across the board.

host: another call from prescott, arizona on the line for democrats. caller: a couple things. are you guys curious about the tea party, go online and watch, for free, a documentary, 54 minute long "the billionaires' tea party." americans for prosperity was funded by the koch brothers. what i found offensive among the thinksort of conservative tanks -- they are corporate- funded think tanks. what they try to do is tell we the people that somehow the interest of corporations are the same as we the people. that is absolutely not true. the second thing is, they come in the form of the heritage ,oundation, the cato institute heartland, americans for prosperity is one. freedom works, competitive

enterprise institute, american enterprise institute, they are not conservative think tanks, they are pro-corporate thing takes. the founders were terrified of monarchy, religious tyranny, and corporations hijacking democracy. please go online and watch that documentary. you are very young and impressionable. what is your response to the things i am saying -- corporations'interests and we the people's interests are not the same. i work for a grassroots organization. the millions of americans are not the 1%. they are not billionaires. they are middle income americans concerned about what is coming out of washington. we have a number of -- we our focused on overspending and

implementation of the health care law. i question the assumptions. host: we talked about how john boehner's comments and let's listen to what he had to say. [video clip] >> i think they are misleading their followers. they're pushing members in places they do not want to be. they have lost all credibility. they pushed us into this fight to shut down the government. most of you know i was not the strategy i had in mind. if you will recall the day before the government reopened, one of these groups stood up and said, we never thought it would work. are you kidding me? you all know me. i say what i mean and i mean what i say.

i am as conservative as anybody around this place. all the things we have done over the three years i have been speaker have not violated any conservative principle, not once. host: a very animated speaker john boehner. your thoughts on his comments? guest: to clarify, the speaker was talking about the defund effort, americans for prosperity never participated in that. one thing -- the reason why he is so upset because groups like mine are reminding him of the promises made to the american people, the promises they made in the budget control act to control spending, to reduce spending. as we see with the budget deal released by chairman ryan and chairman murray, it breaks this agreement. it trades higher spending now

for the promises to cut spending in the future. if you look at the report that came out, the cost estimate from cbo, 57% happened in 2022 and 2023. of the changes to direct spending. if congress is not willing to cut spending now, what reason do the american people have to believe that congress will cut spending in the out years. host: we are talking with christine harbin hanson from americans for prosperity. let's go to new hampshire, matt is on our line for independents. caller: good morning. i have talked to people for americans for prosperity. like many of the other callers, you're a corporate lobbyist. you may not want to admit it. you have grassroots people and common day people in the streets

who follow your beliefs. your beliefs are snake oil. you're not telling the american people you are trying to destroy pensions. you do not believe in minimum wage. you do not believe in unions. doneave actively, actively everything you can to bust unions. you do not believe in a middle- class. you believe in a third world country. you follow your corporate sponsors and their beliefs. you are destroying and dividing america. as far as i am concerned, there should not be any lobbyists allowed in washington, d.c. we the people are the lobbyist. you take the constitution and twist it and distort it. host: we have gotten a lot of questions, obviously, about how afp is funded. guest: we have a wide donor base.

two of our donors get more attention than others. we have thousands of people who provide support for our organization. some more than others. some send us as little as five dollars. to frame our organization as a tool by two wealthy people is completely false. we are a grassroots organization. we believe in a prosperous middle-class. we advocate for policy solutions at the state and local level that will lead to that. host: mike on our line from oklahoma. retiredhi, i am a lieutenant colonel 23 years in the military. i am now in my eighth year as a public educator. i am well versed in the outcomes of our government spending.

i want to thank the young lady for her organization and what they are trying to do. let me just make a comment for the folks calling in. if we overspend, it doesn't matter if you are republican or democrat. if we continue to outspend what we take in, you do not have to look very far. two other countries or within our own boundaries, such as detroit. we cannot collapse as a country. that is the overall entire message that needs to be sent to everybody. in ouro not rein spending, it doesn't matter what else happens. thank you for your time. guest: the caller echoes much of our position at americans for prosperity. he sounds like an activist that i talked to when i travel to our state chapters. people are concerned we are spending much more than we take

in. this is an unsustainable fiscal path for the country. host: we have a couple of questions from twitter. karen asks, when was afp founded and when were you -- and where were you during the previous administration's spending spree? guest: americans for prosperity came out of -- has been around for about 10 years. originally, we were part of an organization called citizens for a sound economy. about five years ago, we became our own organization, americans prosperity, the organization you know today. and regarding overspending, i am the federal affairs manager. i weigh in on the legislation coming in on capitol hill. i spend more than half of my time or an equal amount of time

opposing much of the legislation coming from republicans. we call it as we see it. we remind republicans and democrats they should live up to the agreements they made to their constituents. let me clarify, we are not a partisan organization. we call it as we see it. host: scott in lakeland, florida. on our line for republicans. caller: good morning. i heard mr. boehner say he was a conservative. he is absolutely not. he has increased the debt. devastated this country. he is an appeaser for obama. the people are outraged in this country. he does not leave the room publican party. he does not lead the republican party. what makes him think if we put him back into power, they will do anything different? they were sent there and they

have failed because of mr. boehner. guest: i will not comment on personnel issues. the caller makes a strong point that the american people are fed up on this overspending. host: kenneth in south carolina on our line for independents. caller: i am a retired military officer. i am the exact opposite of what the gentleman spoke about earlier. we can talk about where we spend the most. we spend the most in our military with things we do not need. and our military commanders. things we do not need and continue to buy. i appreciate the statement that we call it as we see it. i would like her to call it as she sees it right now. the biggest issue is misinformation.

she spoke about the fact that she thought this recovery is the slowest in history. she did not say the whole thing -- we have had the deepest recession since the depression, which has no other markers in our history. if she could speak about the whole truth, i would appreciate her speaking to that. final point -- if she could speak to, she said americans for prosperity did not take a position with regard to what what speaker john boehner was talking about earlier. could she talk to whether they did come out against shutting down the government over health care and what that could have done to avoid, spending more money which they say they take in opposition to spending more money. we had to spend more to shut the government down and to bring it back.

guest: i will adjust the last point first. as i mentioned, americans for prosperity did not call for shutting down the government in order to defund obamacare. we are not calling for a shutdown now. no one has the appetite for that kind of false choice. that is not something our activists want. there is time to pass a continuing resolution at the appropriate levels, even if the senate rejects this right-murray budget deal. ryan-murray budget deal. one other point. the caller talked about runaway spending in the military. i think this is a great time to bring up we are talking about discretionary spending right now. the biggest threat to our nation's finances are in entitlement spending. social security.

medicare, medicaid. that is something americans for prosperity has worked closely with capitol hill and would like to see some real changes to that. host: i want to ask you about an article in "the washington post." it talks about some of these competitive races. it points out, republicans have the best opportunity to win back the senate in a decade. gop veterans are frustrated by andamount of time, energy, cash to be spent trying to deal with internal feuds. senator orrin hatch says they are undermining everything we are trying to can do -- trying to do. you cannot do it by destroying sitting senators. host: what is your take? guest: i hear his frustration. we are not undermining anybody.

we're reminding elected officials about the promises they made to their constituents. we hear politicians say they want to rein in spending or they want to put washington on a better path. but when they get to office, we consistently see them break these promises. exceeding the spending levels is a broken promise. this is something that americans for prosperity and our millions of activists are concerned about. we are educating and letting people know, shining a light on this. no more hiding behind votes. host: sticking to politics i , believe seven incumbent are facing challenges. as afp endorsed any? guest: we do not endorse candidates.

host: pat in west virginia on our line for democrats. caller: good morning. i had three points i wanted to make. first of all, unemployment, medicare, social security, and government pensions are not an entitlement. they are paid for at least partially or wholly by a reduction in people's wages so those costs can be met by the employer, or they are taken out of that person's salaries as they go through their work cycle. is easy when you are 30 to not worry about pensions. when you are 61, you begin to worry about pensions. secondly, we consider ourselves a so-called christian nation. but yet we say it is the individual's responsibility to watch after those less

fortunate. i would like to say that we are a government of the people. we are the government. therefore, we have a responsibility to watch after others through the auspices of our government. my last point is this -- profits on wall street are out of sight. corporate profits are at all- time high levels. upper bracket income has gone off the charts in the last 15 years. the economy would collapse if we raise the minimum wage to give those a better life. let me ask you this a different way. how about if we give these people enough of a wage that no longer would need food stamps or government assistance. they would be off of those rolls. it would be corporate's job to take care of those costs.

host: we will let you respond. a lot of people looking to call and. guest: i would like to address entitlement spending. when you look at your pay stub and you see the amount taken out for social security or medicare, that does not go into a lockbox. the money taken out of my paycheck is not the same i would take out for social security benefits. later on down the line. graph, looking at the entitlement spending, this is going to become, we are going to be paying out more than we take in within the next few decades. this is something that poses the biggest threat to our nation's finances and needs to be fixed. host: the republican line from

lucy in mclean, virginia. caller: good morning. thank you for taking my call. i agree with the principles for americans for prosperity and some of the other conservative groups. however, it is time we unite and realize no one on the conservative side would be elected unless we take a stand and redefine our message. the left tends to control how the media delivers the message and it is always slanted. if we are being accused of not wanting children to have health care and all of this total baloney, we will never get elected. it is time we get our foot in the door.

the only way we can do that is to continue coming to work together and not risk all of , whichrimary challenges could lead to more and more democratic votes and they have no concern about the huge deficit and debt we are in. so we have to be real. guest: i think many of the statements the caller made highlight why organizations like mine are so important. why grassroots organizations are so important to keep elected officials accountable. we are not a big d democrat or big r republican. we are a grassroots organization committed to economic freedom and getting people back to work. i think that is why our organization is so important. i think it is something the caller has mentioned. host: another question from

twitter this morning. what policy initiative status afp promote and support to help the middle class? guest: the first and foremost is overspending in washington, opposing the ryan-murray budget deal that has spending levels greater than $1 trillion for fiscal year 2014 and that is one way we are standing up for hard- working american families. another way we have been doing this is by being a strong opponent of the president's health care law. this is something that americans for prosperity has worked on tirelessly, ever since the president first talked about the idea in a campaign speech, highlighting the problem of implementation and advocating for free market reforms to our

nation's health care market is something that americans for prosperity works on a lot. host: a question from e-mail from sue in new jersey. there are rumors george soros was funding the 99% protests. it is a known fact that people with a lot of money like to influence politicians. does it matter where donations come from? guest: i like the sentiment behind the person's tweet. i, too, tire of the scrutiny of who is paying for what and where these donations come from. we focus on policies. we talked about policy solutions. i think it is important to look at what an organization advocates and not who their donors are. host: john on our line for democrats.

caller: i am sure you tire about the scrutiny of the donor base. that is connected to our democracy. the donor base -- the billionaires that are backing you are overriding concerns of people i know. i do not know a lot of people who worry about overspending more than they're worried about redistricting, like here in ohio. it makes it totally unfair to get congress selected. the voter suppression is taking place and is real. it is not just a voter id issue. it truly is suppressing votes in this state. you support subsidizing oil companies. large farm subsidies. at the same time, they want to cut employment and food stamps. children, older people have those needs. i do not think that you represent the people as much as

you represent the large-money people, the things taking place. you are against unions. they help the economy. guest: i think evidence shows states that have strong right to work laws, healthy business climates outperform the states on the other end of that spectrum. americans for prosperity looks at the research on state outcomes like that and we call it as we see it, advocating for free markets, labor regulations is something that is very important. >> on the next "washington ," a look at u.s. trade policy with sanford reback,

global business director for bloomberg government. then, the costs and benefits associated with federal regulation. we speak with blanche lincoln and robert weissman. airs liven journal" every morning beginning at 7:00 eastern on c-span. a couple of live events today. the senate homeland security committee will hold a hearing on the navy yard shooting and security at federal buildings at 10:30. at 2:00 on a foreign relations subcommittee looks at the violence in central african republic. >> i am standing in front of the world's first practical airplane. this was the third and final

experimental airplane that the wright brothers built and survives as the second oldest of their airplanes today. orville wright consider this the airplaneirst practical and was constructed and flown in less than 60 years' time. the time between they built their kite and this airplane. than two yearsss after their first flight in kitty hawk, north carolina. er in kitty hawk flew four times on one historic day. they very much worthy proof of heavier thanwered, air flight. flyerhe 1905 wright behind me was capable of repeated flights, not just for a few seconds, but upwards of 40 minutes by october 1905.

this can fly in circles, figure eights, it could turn and fly very much like a modern airplane. this is very much a modern airplane capable of being controlled through three independent axes of flight. there is more from wright brothers aviation center next weekend as both tv and american history tv look at the history and literary life of dayton, ohio. saturday at noon on c-span2 and sunday on c-span3. energyrding to the administration' 2014 outlook, u.s. oil reduction will soon be 10 million barrels a day. the gap between production and demand will continue to close with the u.s. medium domestic demand by 2040.

this is a little less than 1.5 hours. >> good morning, ladies and. i am senior adviser in our energy resources environment program. it is a great pleasure to welcome an old friend, adam, administrator of eia, to our session which has been done now for the last two or three years. we are very pleased to cooperate on that. adam has been in his current job for about a year and a half. before that, he had a distinguished career for about 14 years with deutsche bank both as chief energy economist and before that, energy strategist. prior to that he worked for about 10 years in a similar role. adam is former president of the u.s. association of energy

economics and former president of the national association of petroleum investment analysts. he has been on a number of advisory committees, spent some time at csis and also at least two advisory committees in the at sis, tot i -- our energy program and he has been an occasional lecturer several times here at sais, so we are very pleased to have him back. he will talk to us about the reference case of the 2014 annual energy outlook. we will proceed with some discussion q&a after that. welcome.

>> ok, will, thanks very much for the introduction. it's great to see you back here in this role at johns hopkins, and i appreciate very much your words. i did hear you say that we are old friends, and i am saying we are friends of long-standing acquaintance. [laughter] i wanted to go through our annual energy outlook. let's see if we can make that work. there we go. the first thing i wanted to do is thank john and paul. john is right here. here comes paul. when we get to q&a, the hard questions will be answered by john and paul. i wanted to remind you that

these conclusions are all based on a complete set of analysis and model that includes some alternative cases, and more that will be coming out early next year as we move out toward full publication. there is a lot of uncertainties, and sometimes i use a slide that says why it will be wrong, long- term forecast by their very nature are difficult. that doesn't mean that you should not do them, even if you think you're going to be wrong. you still want to do long-term forecast, because the reference case provides a really good way of moving towards side cases that can illuminate what it is you are doing. what is going to change,

regulations and laws and consumer preferences and economic growth could be bigger or smaller than forecast. what we have really seen recently is changes in technology, especially in things like horizontal drilling and multistage hydraulic fracturing and so on that have dramatically improved the efficiency of both drilling and well production. so keep that all in mind when you go through these conclusions. one of our main conclusions is that natural gas and oil will continue to grow. natural gas throughout the entire time frame, oil until sometime in either later this decade or maybe early into the next decade. one of the interesting things from this forecast is we now see u.s. oil production reaching 9.6

million barrels a day. that was the prior high back in 1970. keep in mind that's in our reference case. light duty vehicle energy use is declining as vehicle miles traveled begins to slow and vehicle fuel efficiency continues to improve. i already mentioned growth in shale gas production, but that growth in production is going to allow for considerable increases in consumption in the industrial sector and in the electric utility sector, sometime in the decade of the 2030s, even in our reference case, natural gas will surpass coal in terms of electricity generation. we see that growth in natural gas production is not just sufficient to enable industrial

and electric utility use, but enough output to allow natural gas exports to be even larger than what we have forecast in the 2013 annual energy outlook. with growth in both oil and natural gas production, we see the u.s. moving closer towards self-sufficiency, and there are some very interesting economic and geopolitical implications of all of that. finally, even with all of this activity, carbon intensity of fuels in the u.s. continues to decline, and carbon emissions related to energy consumption

are unlikely to ever see the 2005 peak of 6 billion metric tons, and in fact, may continue to either plateau or drift down, depending on further regulations. so let's look at some of the details on this. this shows total energy consumption and total energy production in the u.s. we see that fairly big gap back in the year 2005 has already narrowed towards a 16% gap between consumption and production. that should narrow further as we go out, that 3% number in 2034, by 2040 it is essentially in the

same ballpark. that means improvements in the u.s. trade deficit, and in fact, we're going to be doing some today, an energy article looking at energy and u.s. trade over the course of the next few weeks, so keep your eye out for that. i mentioned that oil production is projected to reach the prior peak back in 1970, u.s. crude production reached 9.6 million barrels a day. we are going to touch that level or come very close to it by the end of this decade. i think it will plateau. the current forecast shows it coming down. it has a lot to do with the geology of shale oil resources

and production. this is a significant increase actually from the 2013 aeo forecast, which had numbers well below this level. let me explain something that i'm actually very excited about. when we published the 2013 aeo, that was december a year ago. we had oil production data coming from our survey that at best in december -- i actually have to back up and say the models really got locked down around september. that meant we were working with numbers from june. in some cases, those numbers are really not complete and so you are working with data -- we were

starting with data that was already relatively old and incomplete as a starting point. what we do to fix that problem was to create the drilling productivity report they are sending out monthly now. from eia. the drilling productivity report actually gives us a forecast from this month and next month's production, so when we were locking in the aeo 2014 numbers, we had a pretty good idea back in september and october what current production was going to be and what it was going to look like toward the end of this year. so we are starting with numbers that are six months to one year better for our long-term forecast and what we were able -- than what we were able

to do in 2013. i think that is going to go a long way towards improving the near-term accuracy of the aeo 2014, and i'm very happy about that. one of the other conclusions i mentioned up front. motor gasoline consumption, transportation use of fuels in general has added up and will drift down over time. the numbers are shown in quadrillion british thermal units, 25 million btu's is roughly 12.5 billion barrels a day. you can think of transportation being roughly two thirds of u.s. oil consumption and break it down in those percentages. we can see jet fuel picking up a little bit, diesel fuel picking up significantly.

base andh from a low things like liquefied natural gas being used in transportation. a little bit of an increase in ethanol as a part of the motor gasoline consumption numbers. that peak back near 2005 was barrels a day,n the 2012 days we were starting with was 13 for -- 13.4 million barrels a day of transportation fuels. we see that low point roughly around 2030, and that is about 12.3 million barrels a day. again, this is the reference case. the current auto fuel efficiency rules begin to taper off around 2025 if policymakers decide to extend the fuel efficiency rules, we would see even lower numbers in there. we will run a side case on that this year, and that shows more

of a decline than this plateau you are seeing here. i mentioned that shale gas, we still see expanding. we do not see any peeking at all and the ability of industry in the u.s. to produce shale gas. in tighteing expansion production as well as shale gas production. by 2040, we will be over 100 feet per day of these productions of natural gas. tole gas alone -- from 50 roughly half of the u.s. natural gas reduction. this is a remarkable development. marcello, haynesville, eagle ford, barnett about fayetteville, the big news is

marsalis formation in pennsylvania it is now producing, estimated and are drilling productivity reports, this month hit billion cubic 13 feet per day. in 2010 it was barely two bcf a day. so what is going on in terms of shale gas and shale oil production is a very remarkable development. i mentioned that we saw natural gas actually exceeding coal in terms of electricity generation . that happens in that period past 2030, so that is a long ways away. that is based on current regulation, and it is very possible that we might see less coal and more natural gas replacing that coal as we moved out over time.

one of the other interesting things that is happening for and natural gas, and the increase in shale gas production -- allowing for, in our models, considerable growth in natural gas in manufacturing. so if you just look at that let's, and, 2025, concentrate on that as a nearer- term projection. these are stacked up in terms of the coming growth. the biggest growth is at the top and moving down towards the bottom. we're seeing a huge increase actually in natural gas use in refining, and both chemicals and even into processing. iron and steel production and other primary metals.

this is industrial production in our model, growing at 2.6% per year. 2025.n 2010 and the number of industries are clearly taking advantage of this relatively inexpensive, certainly relative to oil, fuel. there is growth of 3% or better per year in industries like primary metals. so, higher level of manufacturing shipments leads to greater manufacturing natural gas demand. and all of that is resulting in positive impact on u.s. industrial production and gross domestic product, or gdp. on natural gas, this chart shows

our projections for natural gas exports. so if you start at the top of the chart, and start to work your way down, you can see the numbers that are now a part of the aeo 2014. the biggest u.s. export of natural gas are exports to mexico by pipeline. we also export gas to canada. if you look below the line at the negative numbers which is imports, you also see canada listed there. we are currently at a net importer of natural gas from canada, but those numbers have been coming down, so we import more gas from canada than we export, but i think it is kind of an interesting fact of north america and the north american free-trade agreement, and our long-standing very positive relationships with canada as far as trade are concerned, that

there's a lot of two-way movement in gas across the u.s. - canadian border. we see more room for lng exports from the lower 48 states than we did last year. we still have a projection for alaska natural gas exports in these numbers. keep in mind, our forecast ourasically, come out of national energy modeling system. they are not regularly based on permits. for example, there is no current permit for gas to be exported from alaska. we just think that the economics of that, as shown in our model,

since we were talking about lng exports, and i'm sure is obvious going to be a question about this, so i would have a slight -- slide on it. that is what about roddick exports -- product exports? the u.s. is knowing that exporter of petroleum products. the numbers right now roughly 3 million barrels a day of raw that exports -- product exports, and a smaller number of product imports. we are in that exporter of -- as we were in 2012. the black line shows the crossover point of being a net importer to be a net exporter. as we move out, in the next two years we're seeing product exports moving up to be up toward one million barrels a