lower prices for crude in this country compared to global markets and an increase in homegrown energy. the band made -- ban may be unnecessary at some point i will close with a sports metaphor. it would be like ending the game after the first quarter. thank you, mr. chairman. i look forward to answering any questions you may have. >> thank you very much. [inaudible] members of the committee for this opportunity to talk about this important subject. i have been writing about the influence of opec on our country since i was a junior in high school, believe it or not. i won a term paper contest in the state of massachusetts. to talkglad to be able

about the fact that we might get goalpost, get-- the ball through the goalpost. the united states is a leading global power. freeomote open markets and trade. we have for the last 30 years spent a tremendous amount of diplomatic effort to promote open markets and free trade and energy. the is a vital interest of united states. i appreciate the thoughtful comments of the committee in terms of full debate on the subject. we do not want to take actions that enhance the monopoly power of opec or russia to use energy as a weapon or a tool. we want to lead from the front not from behind. have important for us to

this thoughtful debate and reevaluation of our current export policy. avoidd to consider how to creating market distortion. we need to consider the following things. we actually export our new oil and gas. form oft our oil in the refined products directly so we do not have an export ban on gasoline, propane. we are exporting that instead of exporting the crude oil. what we are discussing is what is the best way to organize free markets and to eliminate distortions and who gets the profit from the exports? with the refining industry get the profits?

will other industries get the profit from the exports? we are not in here to discuss exports fromnergy the united states. we need to keep that in mind. have physical bottlenecks that prevent us from exporting our surplus of natural gas, we are currently exporting coal. we need to understand that when whole -- hole in -- theint in the dyk natural gas example is the best example. nobody expected the result of that to be the export of coal to europe. i am just returning from the

world economic forum in. those and i can tell you the entire discussion focused on europe's need to reevaluate their entire energy policies because they are missions arel, and going up, they are not drilling for natural gas, and they realize they have these huge distortions. sure theo make policies we promote here in our country will continue to allow us to achieve the advantages that we have. i want to a dress for one moment the issue of gasoline price volatility. the solution to gasoline or any kind of consumer volatility in -- minimalhe mandate standards for inventory. that is what happens in europe, that is what they do in japan,

and in south korea. that is how industrialized economies protect consumers against sudden disruptions from a like a refinery fire or a sudden cold snap in the winter. inventory levels are the critical issue to tied markets under temporary swings. closing, i want to remind the committee and our public that when we had a temporary disruption of gasoline on supply during hurricane rita and europe loaned us gasoline supply from their theytory strategic stocks require industry to hold. oureed to consider relationship with our allies,

like europe, when we think about our future export policies. >> thank you. thank you for the opportunity to testify about whether to lift the crude oil export ban. since 2008, the united states has produced more and used less oil due to advances in drilling due to moreand efficient vehicles. lifting the ban on crude oil exports could squander this recently improved energy security and price stability. we urge you to defend the existing domestic crude oil export ban. when congress passed in 1975, the u.s. produced 64% of its oil while importing only 36%.

in 2013, we produced and imported the same proportions of petroleum. hadonly experience we have of lifting oil export ovation occurred following the 1996 removal of a ban on alaska oil exports. much alaskan oil was shipped to the west coast. an analysis found that lifting the oil ban tripled the already existing price difference between west coast and natural gasoline prices. exports cease,l the gasoline price differential between the west coast and the national average to decline. lifting the nationwide crude oil export ban could raise gasoline prices. -- prettyts produce get lifting export ban could add $10 billion a year to consumers fuel bills. oil companies could sell their oil at the higher world market price, which the inner fee --

-- theinformation foreign domestic price spread for oil was $10 a barrel. domestic reduction has significantly grown over the , the energyars information administration projects crude oil production will peak in 2019 and begin a steady decline after that. this energy abundance could be a temporary phenomenon. they also predict that in 2014, the u.s. will consume 5 million barrels per day more of oil and liquids than we produce. this cap between demand and supply to continue at least .hrough 2040, growing by 13% i advise you to look at the chart the clerk has. this is hardly energy independence. overseastic oil sold

must be replaced by more expensive imported oil each could raise gasoline prices. the replacement oil would likely be heavy crude imported from venezuela and canada. venezuela is not very friendly to the united states. canada is our closest ally, its heavy oil produces double the carbon pollution responsible for climate change compared to conventional u.s. oil. neither of these are good options. u.s. imports more oil from the organization of petroleum export countries than any other single source. opec oil is vulnerable to supply disruptions. interruptions may occur frequently for a variety of reasons including conflicts and natural disasters.

the unitedd in states is less vulnerable to supply disruptions and provides more energy security. u.s. is exporting 3 million barrels per day of refined petroleum products. we are expect -- we are exporting oil already. he would rather see that oil cap tear and made into a product by american workers rather than a product made into by foreign workers. oil companies are doing quite well. companiesargest oil made a combined total profit of over $1 trillion in the last decade. that is based on their quarterly reports.

our transportation system is entirely powered by oil, which makes crude oil different from many other commodities. economy families, the and our energy security are vulnerable to sudden foreign oil supply disruptions and price spikes. we must invest in alternative nonpetroleum transportation power, including electric vehicles, biofuel, it and public transit. there is no independent evidence that energy security of fuel prices will remain unchanged after the removal of the crude oil export ban. president obama and congress should maintain our recent gasoline price stability and energy security by defending the ban on crude oil exports. thank you for having me. >> thank you all of you. i will ask one question to start this off.

mr. hammond mr. burnett have different views. and mr. burnett have different views. both believe the same benefits and potential pitfalls exist for their preferred policy position. lower prices if the senate follows their advice. higher prices if we do not. , how canion becomes this be? thoughtful very individuals and they have diametrically opposed views. is this a lack of knowledge? that different

regions of the country would be effect it in different ways? if export restrictions are lifted, is it possible that america would see prices go up in some parts of the country and down in other parts? i want to hear the four of you weigh in on that. i think it comes down to one example i can give. for aly, a spokesman large refinery in the united states, talking about the nationwide export ban. it wouldn't salute -- insulate americans from geopolitical pressures. , itold the market recently provided a particular unfair advantage in the market. pressure oneing

refineries outside of the u.s. and closures occurring. about -- projected last year, half a million barrels. 1.6 million barrels per day the previous year. i think we all realize that refinery closures, not good for consumer prices. and they are not good for my business. we need refineries. that is not good for anyone. the difference between me and this gentleman is considerate. question. >> the fundamental difference is

whether u.s. oil prices would go up or go down as a result of exports. it is my position that if the u.s. begins to exporting crude oil, the opec producing countries and saudi arabia will act to maintain crude oil price by reducing their output. my logic is based on the fact that crude oil prices will rise to an international level. the net result of that would be increased feedstock cost to our refineries and the closure of refining capacity in the united states, particularly in the northeast. less supply of gasoline and other fuels and higher costs. started this by the illusion that there may be regional differences. let me let you take a crack at this. >> i have to talk about how the international oil market works because sometimes people are unclear.

when we export refined products globally, it means refiners in europe have bought those products and they have cut their opec is runs and already affected because they cannot sell more of their crude oil to europe because those refinery runs are shot and are gasoline exports are hurting opec. whatever opec policies they will take summit they will take whether we export the product or whether we export the crude oil. that is not the issue, right? -- we have a slogan in the oil market. the tyranny of geography. whether i am selling refined product or whether mr. hamm is selling his crude oil, he wants to sell it to the closest possible refiner because that is how he makes the highest amount of money because the transportation costs eats into his profit.

even if we were to lift the oil would, the crude first and foremost look for a buyer inside the united states because that is how it would be most profitable because that would be the cheapest transportation. if it happened that there was a refinery in mexico or canada , the oil willefit flow to the best possible use. what that can mean when we have , those bottlenecks thate some distortion might artificially lower prices

in one particular geography for a particular time until that bottleneck -- >> i am over my five minutes. important to know that we really do not export very much gasoline right now, a little less than 400,000 barrels a day. the primary product we export is low sulfur diesel. being a see that as real challenge. i would agree with mr. burnett that it is tough to try to lower the price when the price of the commodity is controlled i a cartel -- by a cartel. i would see it would not lower prices at all to allow exports of gasoline -- sorry, exports of oil. >> we will continue this discussion. the pacific northwest has a history of some of the highest hassling prices in the country. if there -- highest gasoline

prices in the country. the people i represent are going to be very interested in that issue and steps taken to protect them and their well-being. referencess, you made to the alaska export issue and there was also an essay that was recently released from the center for american progress that also made some claims about alaskan crude oil. i want to insert into the record, 1999 study from the gao that examined the impacts of lifting the ban on crude oil exports from alaska. in that report, they state despite higher crude oil prices, no observed increases occurred of three important

petroleum products used by consumers on the west coast. this was not cited in the essay. i would like to submit a report back in 2006 which was also cited. >> without objection. >> we have to make sure we have the full quotes in context. mentioned the tyranny of geography. i was reading an article yesterday where because of the glut of the oil coming from the refineries,he gulf texas is looking to move their crude through the panama canal up to the refineries in california. it speaks to the issue of that we get to a point

where we will have a mismatch between what we are producing domestically and our ability to meet the needs, the capacity within our refinery. understanding and appreciating that it is getting to the point now where we have reconfigured as many refineries as we can. maybe there is a little more room. we are looking to some pretty significant decisions. when you are moving crude from texas to the panama canal to come out to the west coast refineries, and still hoping to make a profit. we are looking for some solutions. this issue of timeliness is one that i have been trying to track . that can notolumes leave north america are increasingly posing a challenge to industry, winning the spotlight on where we are today,

which is the oil export ban. this timeline comes up a lot in discussion. i am not asking for a date, but what is your general sense on collidese initiatives with production? when do we hit that misalignment or mismatch that could then cause some real disruption? the mismatch is beginning to happen already. refittedefineries were for heavier crude when it did not look like supplies would be your domestically. most of what they would be without those

retrofits, it does not fit with some of them. to thed to move that more efficient ones that could handle this low sulfur premium crude oil that we are producing in north dakota and other places. beginning tois occur. a lot of people expected to occur as quickly as the over supply of natural gas. reduce that halfway to about 32% in nine years. that is a really good move. ms. jaffe. to

>> when you look at the specialized models for the trading of products and crude oil, people anticipate that by 2016, our condensate flows will be so high that mixing them into the crude stream, exports to petrochemicals, will max out for our physical facilities unless there is some giant upsurge in investment for specialized equipment, which is not on the horizon. in 2016, we would face a situation where companies like continental resources may have to stop drilling because it would be a containment problem. we would not be able to find a place to store all of this condensate if we cannot produce it and export it. >> we have not seen any refinery since -- 25 years? >> we have seen two companies,

, valero has valero a distillation tower. marathon has made an investment in ohio. these kinds of investments take time. if we do not have these giant investments announced in the next year or so, i think it will be very difficult to absorb the cost -- condensate flows. >> i am well over my time. >> if you could quickly offer your views? the energy information administration has documented that the refining capacity in the last dozen years has increased by about 2.5 million barrels per day even though we have not opened a new refinery. the utilization rate is at 87%. there are numerous refineries

that will be expanding over the coming years in north dakota and texas. >> thank you very much, mr. chairman. this will be a simple yes or no. the xl all believe pipeline -- keystone pipeline would be a strategic advantage to the united states of america? >> i've certainly been in that camp. the thing that has really hurt everybody up there is the delay going on. >> you are in favor of it? >> yes. >> yes, i think the only way to keep the canadian oil in the ground is to lower demand. if you are in favor of the pipeline? thef we have the demand for oil, we need to transport oil by

pipeline. >> no, i am not, because of the huge increase in carbon pollution. we get to keep the pollution and other countries will get the petroleum products. -- we do notof us understand, we keep talking about energy independence. we're still paying high prices at the pump. can you explain the opec position? -- will they maintain the oil cartel and be able to control world pricing? -- canever change to that ever changed to where we in america can benefit? opec's -- >> the higher opec's market share, the more power they have to control the price. as the united states becomes a

bigger producer, and the eia projections are based on current knowledge. we are having a paradigm shift in the way we look for and produce oil. projectionsary as the united -- states and north america and mexico and other countries produce more oil from unconventional resources, opec will have a smaller and smaller share of the market. their producer power will be reduced over time. to the extent united states exports crude oil, and countries that are in europe and countries in asia are able to buy spot oil and gas ates , than competitive prices

opec's power will be reduced to radically over time. -- dramatically over time. >> if they want to have oil at $100 a barrel, that is what it has been. and controlartel 40% of the oil produced. it is easy for them to turn the spigot one way or another to get the price they want. that is how cartel's work. >> the pricing, the way the pricing on crude versus the pricing on natural gas, why is there such a difference? we are not on the world market with gas.

gas is $15 or so in japan. transportation is harder and the supply is -- for usou see feasibility bringing the price of gasoline at the pump down for the people? are they ever going to see any relief at all? >> we have seen a decrease with both diesel and gasoline. >> they have not seen a decrease in the price at the pump. >> in some places, you will see that. in oklahoma city, we are $2.85. diesel, it runs close to five dollars. >> 72% of the price of gasoline

at the pump is due to crude oil price. when you lower crude oil price, the gasoline will come down. >> we will have to call little bit of an audible. there will be four votes on the senate floor at 11:15 a.m. >> i want to commend d for buying a refinery in pennsylvania. delta for buying a refinery in pennsylvania. outstandingis an individual and does a great job. >> thank you very much. priority for one americans when you talk energy is they want what they call energy independence. i know you would refer to it as

energy security. it has produced more energy than we consumed. i cannot think of anyone who has done more to help us achieve yourself. you, whatquestion for can the federal government do to help us produce more energy in this country? what can the federal government do to help us continue to increase our crude production? how do we get there? when he to change some rules that are totally archaic. they limit what we can put on the books for five years. a lot of these -- it is going to take 20 years to develop it. i cannot put those on the books.

those numbers totally are distorted. we had to teach them how to count. they were only taking the crude oil numbers and not putting any of the natural gas liquids and. once they did that, we're up about 12.6 million barrels a day. we have to get the numbers right. those numbers are totally pessimistic. do no harm. we are going down the right path . ifwe do not have a lot of -- we can get the export ban lifted, people can go ahead with their business. we can get there. what we produced in the past in this country for the past 160 years is what leaked off of the source rock beds. and now we can produce those

source rocks. we are on our way to get there. both with gas and oil. all we need to do is do no harm. >> my second question goes to transportation. we have had accidents with rail moving crude. we need to address that. tommy what we can do and what we should do come a what -- tell me what we can do and what we should do so we can make transportation by rail safer. >> rail has come a long way. it was deregulated. regulations put it out of business, as we all know. it is doing a good job and we are seeing a lot of real companies that are doing tremendous. there are three things. safety is ultimate. prevention of accidents, preparation, everybody is

working on that. rerouting trains effectively, they are doing not. rail inspections. --y are going to to a month 22 a month -- two a month. standardization that needs to be done. the rails are into it and they are working on it. safety is of utmost importance to them and they are doing their job. >> as we develop more energy, we need infrastructure. that means both pipelines and rail. would you agree with that? >> i do. rail cost more. it will put oil to the places you need it and do it quickly. the pipeline will take the place of it. expand and develop

more refineries? we are building a refinery in north dakota, the first one in 25 years. get more refinery expansion and development in this country? some capacity added to the existing refineries over the years because you could not start one from scratch. there is so much federal regulation. expansion, add new towers, it has been done. overall, looking at regulations that hinder them from building new ones, they are more efficient and better. it needs to be looked at. >> mr. burnett? it has to be quick. >> there is sufficient capacity and united states to be able to

all of the oil that is being produced. the issue is infrastructure and getting the oil to the refineries. the and the structure is not there yet. these projects are all in progress. it is a lag effect, a lag in the infrastructure, but it will come. >> we have 15 minutes for two senators. >> i want to go back to ms. jaffe on something you touched on and then i would like to get everyone's thoughts. is themy concerns potential lost opportunity cost in terms of are we exporting crude or are we exporting refined petroleum products? it seems to me that we create more jobs by exporting refined the trillium products. can you expand on that?

-- exporting refined petroleum products. can you expand on that? kid, my mom sewed levi's. we had a textile industry here. those jobs have gone away. give me your thoughts. >> i have an opinion on that. when you are doing complex trading, it is hard to say. the experience in the industry is that companies like continental resources i'm a -- resources, when they have better cash flows, they invest those cash flows into filling. -- drilling. the drilling creates a lot of jobs. when the refinery raises its throughput rate to 90% versus

80%, that does not create very many jobs at all. is not ais a very -- very job intensive industry. arabia has soudi much trouble creating jobs inside the country. it is not a labor-intensive industry. on balance, if your goal was 100% jobs, you would create more jobs having more of a cash flow through the upstream side. the university of massachusetts did a study several years ago and found that investments in oil production create one third the number of jobs compared to investments in wind, solar, and other forms of clean energy. investments in new mobile has a much bigger way off -- renewables has a much bigger payoff.

agree. it is according to where you want those jobs. more jobs created in the upstream sector than anywhere else in the last 10 years. refineries, i used to work for one. not very intensive from a manpower standpoint. business, we create a lot of jobs. >> mr. burnett? >> one thing i want to emphasize is the exported products into a free and competitive market. it is better for the united states to keep the added value in country. if you look at the oil-producing countries around the world, they are all building mega- refineries. i will yield back the last of

my time. >> gracias, as always. senator scott -- gracious, as always. senator scott? >> in your testimony, you touched on how lifting the export ban on crude oil could improve our trade deficit. how it willnd improve our trade balance, particularly in regards to china? >> we will be in a unique position where our imports of crude oil, which are huge part of our trade deficit, are going to go down over time. we will have a situation where china is going in the opposite direction. they will have a higher and higher rising amount of their oil. for importing crude as we move forward, they will be increasing in their debt and

into thelity international bull market. we will be able to strengthen our economy through these improvements in our trade balance. i think one of the things that is they have us in a great cycle. they support iran. they support other players in the middle east that cause disruptions and instability. dollarsto spend our tax sending our military out there and our young men to help with those troubles and that makes us more indebted to china. they are buying our treasury bills with bonds and so forth. when we can get out of that not having this constant burden of rising prices. china is the one that feels the pain of all of the instability in the middle east.

we will find it easier to bring china to the table to negotiate about stability and her nationally. -- internationally. mr. hamm, you have been one of the best guys. i read through your testimony and you said by 2025, we could see another million jobs coming out of the oil and gas industry. when you think about not lifting the export cap, what does that do to our economy? in north texas, we have seen a term in the search. oklahoma -- tremendous surge. oklahoma as well. it can certainly put a cap

and stagnate what we are doing in the future. it is not a good thing. are going to get to where we are energy independent and cause opec to have a severe step back, when he to follow through with this. >> mr. weiss? >> as long as we have the difference between consumption , we will have a trade deficit on oil whether we export or not. if we export more oil, we will have to import more oil to make up for that gap. the number one thing we can do is to radically reduce consumption. we have newdeficit on oil whetht or not. if we export more fuel economy standards. could go beyond that after 2025 and that is how we would

reduce our trade deficit by dramatically reducing our consumption. >> i saw you shaking your head. we could quickly solve the problem of our deficit by allowing us to get on federal land. it every to point out, refinery in this country has a different configuration of what kind of crude oil they can or cannot refine. whether we export or don't export, we will not physically change that. because of the tyranny of distance, refiners will invest regardless of whether we are exporting or not. it in thether leave ground or we will export it. there may be a time when we could produce as much light

crude in this country as could -- we are still going to need heavy crude because there is just going to be some refineries that already exist in the gulf coast that have certain configurations and only so much light crude they can put the the system. we will always have to import heavy crude. >> i yield back the balance of my time, which is a -16 seconds. [laughter] wisconsin is experiencing a propane crisis right now. very short supplies, increasing prices. i am very interested in the subject matter of this hearing my perspective of how it will affect propane. i have two questions for you, mr. burnett. i mentioned earlier that one of of ouror components propane shortage in the midwest has been the result of

significant infrastructure changes. pipelines that have served the region for decades are being repurposed to serve no oilfields. we understand -- serve new oilfields. as oil production increases, i think these infrastructure pressures will only increase. if more american infrastructure is dedicated to oil that is heading overseas, is there adequate remaining infrastructure in the united states to ensure others -- potential fuels continue to flow to americans? >> what are the crude oil is to -- refined domestically or exported, logistic problems will remain the same. crude oil arrived in the gulf coast and all of the movement

friends -- all at the movement was from south to north. i do not know if that answers your question, but i think it will continue. argumentt is a good for the keystone xl as well. what impact the export of crude oil will have on the prices and the availability of propane and other critical fuels that are used in everyday life to heat homes and power tractors and do all sorts of other things? >> i'm afraid i do not know the answer to that question. oilell, the export of crude will not affect propane in your state. the liquids out of natural gas

-- andion and when we whether we export crude oil or not will not matter. these infrastructure problems, hopefully, we can get to where we build new pipelines in this country. thise have to realize that is going to go forward as far as the energy renaissance. money back into the infrastructure that is necessary. >> i have been trying to school i celfin the production of propane because of the crisis myself in the production of propane because of the crisis facing wisconsin. >> primarily from natural gas. >> can i elaborate? i talked about the condensate exports. when you produce both natural , natural gas oil liquids can be a byproduct.

propane is one of the things that get stripped out of natural gas liquid. the export of crude oil to the extent that it stimulates more ,roduction in the united states it will produce more and more propane over time. people are expecting a giant surplus of propane over time. when you have an extreme weather event, no matter how much natural gas we will produce in this country, no matter how many refineries we have and how much is surplus of oil there is in the global market, tyranny of distance. if you have a unique market that uses a particular fuel, you will always have weather related bottlenecks. contribute of other in factors. a harvest that used an exceptional amount of propane. the supplies were low going into

the extreme weather events that our state has been experiencing. pipeline disruption, complicating factors. the weather event alone did not cause the shortages. >> the solution to that is regulated inventory. give back tog to you if i can get mr. weiss to answer the question. there has not been an independent analysis to try and predict the impact of lifting the crude oil ban on the price of gasoline or other refined products. this committee could ask the energy information administration to conduct such analysis. due to sequestration and budget cuts, eia is having to scale back the amount of work it does. that is probably for another hearing. >> i did want to follow-up with you about that.

i heard that in your testimony. it is something that we certainly need to be looking at. >> you all may be experiencing another first in the senate because you are about to get what amounts to a joint question from myself and senator michalski. wrestling with the definition of energy independence. i frame it as how you go about defining energy security. i will yield to the senator, who would also like to be part of the discussion. when i contemplate energy security, i ask myself, does this mean no more imports? or does it mean the capacity for no more imports? or does it mean more exports?

this whole question of what constitutes energy security , energy independence, i want to let my colleague weigh-in on this. you are seeing are bipartisan -- we always try to find new ways to demonstrate. we have never asked a joint question to my knowledge, but there is always a first time. murkowski -- ator easycause it is such an question. we are starting to act like an old married couple. i hope you let me finish the thoughts. i have been thinking about how we define energy independence.

we have a couple of ends of the spectrum. we can either be very insular as a nation and try to do it all ourselves and some are knows that the rest of the world -- thumb our nose at the rest of the world. or we can allow for greater flow of exports and opportunities across our borders and insulate ourselves from the shocks of world prices. when i think about energy security,ce, energy it goes to things like economic security. how do we ensure that as we deal with our energy needs, we have also helped our economy becomes stronger. we have worked to create greater

jobs and opportunities. security tow energy be a situation where we kind of close in on ourselves, but rather that we are -- we open up to a greater extent. i doing so, we become less will marble -- vulnerable to the impacts of other -- of actions of others. i do appreciate my colleague letting me join in on this. i said, you cannot ask that question, i am going to ask it. it is important to wrap up this very important hearing, to take us back up to 30,000 feet, what are we really talking about here ? it goes to the whole issue of not only oil exports, but export of our energy to we are successfully able to produce in this country. >> each of you take about a

minute. we can still make the vote. i think it is plural instead of singular. there are more foreign-owned .efineries you never stop them from being able to ship their oil. that is the way you have to look at the balance of the two. i would suggest that we look at overall, not be inclusive of just to we are and what our needs are. >> let me defined by what i mean by energy independence.

gas, coal,ensates, and alternative energies. energyo need to define independence for north america, not the united states. it has to include canada. it is feasible for north america to be energy independent before 2030. there will still be crude imports. but it would mean an increase in product exports and exports of coal and other energies as well. >> i would say i agree with that. tyranny ofogan, the geography, there will always be balancing for quality and other reasons the tween different kinds of energy sources. reasons between different kinds of energy and sources.

supply bottlenecks, no matter how they are created, are the things that make volatility intense. senator murkowski is correct, a secure global market is what is going to bring american consumers the lowest price and the most consistent stability in fuel prices. should what the u.s. seek to do, be a responsible participant in making sure we have a global market. >> i appreciate the joint question. i'm sorry we are not able to give you a joint answer. all of the discussion about energy independence is focused on supply. my view is we need to focus on reducing our demand. that is something we do have control over. it will help save consumers money and reduce the carbon pollution that will cause

extreme weather. i think we need to focus on reducing demand. transportation, which is fueled over 90% by oil, we need to invest in alternatives to oil. electric vehicles, natural gas fueled trucks, hubbell a transportation -- public transportation, advanced biofuels. as long as we are, we will still be here having discussions about energy security and independence. >> thank you. this is the first hearing on this topic. it will not be the last. i knew it would be a piece of cake to find common ground on this question. this will be in the deed -- to be continued department. the committee is adjourned.

>> the house is not in session today but the senate voted this afternoon for swift changes to the flood insurance bill, delayed -- increases in federal insurance minimums for four years. the final vote was 57-42. the senate will return monday to pick up the farm bill, that was passed in the house earlier this week. span2 andorward on c- the house hearing here on c- span. in about 20 minutes from now, president obama will be live to words of education issues at a high school in nashville. his his his today post-state of the union trip. we will have that on c-span.

the -- stateore on of the union with the afl-cio. >> we are back with bea lee -- lee, welcome back. let's talk about the state of the union address. they have laid out a wish list for the state of the union. did you hear everything you wanted to hear from the president? >> we heard a lot of what we wanted to hear from the president. he laid out a bunch of things that he is going to do and what we hope the congress will do to address those issues. did not hea there are some things we did hear that we wanted to hear about this in the middle class and the economy cap. congress' court, we went to see action on

employment insurance and minimum wage, and some other things like universal pre-and garden -- universal prekindergarten. host: what about extending long-term unemployment insurance benefits? when do you expect that to come up? sure exactly,t but this is a disgrace this has not happened already. workers are losing benefits. they have to looking for a job. they are in the labor market. christmas came and went, congress went home to their comfortable homes. millionore than 1.5 workers have lost benefits. it is long overdue. host: "the new york times" reports that the test will come next week. harry reid has planned to bring a proposed extension of emergency on employment benefits back to the floor after it failed last month.

this is what he told reporters. we figured out a way to pay for it, we are very close to the 60 votes needed to overcome a filibuster. i sought where he said in another newspaper we are at 58 or 59 votes. should this be paid for? guest: no, i do not think it needs to be paid for. the democrats have put forward proposals that would get us there, we have gotten very close a few times and failed. i hope this will come through without too many concessions made on the part of the democrats. host: "the new york times" says mr. reid laid out further potential points of conflict. on march 6, he will take up raising the minimum wage, which many republicans opposed. why is this an important issue? guest: raising the minimum wage is key to making sure that people who are working full-time are not in poverty.

that is a simple fact. it does not need to be a conflict between business and workers. it is good for the economy if families have money in their pockets. they can buy the basics and support their families. it is out fairness and also good for the economy. making sure people have money to buy what they need. there has been research on this, we have not seen a huge unemployment -- a huge negative job impact from raising the minimum wage. economy you see healthy where workers are more productive and there is less turnover. this has been good for the economy and good for workers. republicans disagree. if you look on the state level, state that have enacted minimum wage increases in 2013 -- new jersey one up a dollar, new y ork up $.75. .alifornia, went up

rhode island, connecticut. why does it need to happen on a federal level? should this be a state issue? guest: that is inefficient to have different minimum wages in different places. at the state level, there is a groundswell of support. it is overwhelmingly popular to raise the minimum wage so people can have a decent living. it is more efficient to have a federal minimum wage. states are stepping in because the federal government has failed to act. it is better than nothing, and where it is happening, we have seen good results. paul ryan, republican of wisconsin and chairman of the budget committee had this to say uawk box.""sq ourpeople who get hurt

people who meet entry level jobs , we are praising them out of their reach. guest: that is old-fashioned thinking. a lot the folks who are earning the minimum wage are supporting a family, single moms, people who are working full-time. we have not actually seen that. instead, when people pay a decent wage, workers stick around longer. there is less training costs for businesses. the workers are more productive. and they can't afford to buy stuff in their neighborhoods and communities. you have a positive economic impact from raising the minimum wage, putting money into the pockets of people who can spend it and who need it. host: larry, west virginia, republican caller. caller: i would like to say i joined unions in the 1950's. a goodder myself to be union member. the unions became a branch of

the democratic party ever years. -- over the years. i think they were wrong in supporting universal health care. one of the main reasons people join unions was to get benefits. if unions were the first ones to -- thatfits for workers is why the unions last membership over the years. the other thing, union leadership has gotten to the point where they are more interested and reps and the democratic party than their more interested in representing the democratic party than their membership. host: let's get a response, thea lee? guest: you talked about unions supporting universal health care rather than bargaining. we need to do both. forns are spokespeople working people generally. in our country, we have so many people without health care, it

causes an inefficient system overall and to cause a strain on the system. that is what we were seeing, the system was so broken that we needed to figure out a different way of doing that. in terms of the democrats and republicans, unions need to support those candidates who stand with working people, whatever party they are in. that is an important principle to stick by around the country. host: do you endorse or give money to republican candidates? guest: we give money to both democrats and republicans. the decisions are made on a local, case-by-case basis. are relationships between elected officials and candidates and the unions there i local level. we do a scorecard, we look at the positions on the issues important to working families -- bor law,it is la minimum wage, trade policy. host: on union membership, here is "the wall street journal" with a chart.

union membership has been declining, but the level of study in 2013 from the year prior. what happened? guest: we are coming out of a deep recession, during that time we lost a lot of union jobs. it has been a rough couple decades for the union movement. lossmaking challenging to form a union. as the economy stabilizes, we hope there will be an ability to grow the movement and reach out to workers who do not have the opportunity to have a union yet. host: sam, michigan, democratic caller. hi, recently, i got into a big squabble on facebook with some people over strikes here in 1964. it got kind of violent. i was overwhelmed by the antiunion rhetoric that was expressed in the face but squabble. -- expressed in the

facebook squabble. i hope they unions can get themselves back up to where they were. good you can get a documentary out about how great the unions have been. host: what do you think about collective bargaining? caller: i am for it. host: why? caller: you have got to bargain and communicate to get problems overcome. afl-cio president richard trumka tweeted, "collective bargaining is the best way to raise -- we are in right after the state of the union. you mentioned collective- bargaining. talk about it more.

guest: i appreciate the call and the sentiment. unions are for one thing. to stand up for things they need. the negativity towards unions, i think we have work to do. we have to make sure we can be the very best we can be and represent workers as well as they can and represent their voices in the political system. part of it is that there has been a backlash against unions. it is so simple and american and unions have a strong history of building the middle class in the , fighting for a weekend and basic labor protections, something we would like to see the labor movement do even better in the coming years. recoverable -- republican caller. this union problem is more than what people realize. every government job, whether it

federal, hasal, or to pay for bailing wage. the workers get paid in new york state up to $43 an hour. every public holding and every school and every road done by the government has to pay a prevailing wage. we can understand why loans are not as they used to be. we do not have the -- the economy we had. the union continually pushes for more money and then they do not put out the work. ago, there was a big need for unions to give a fair wage. they pushed it beyond fair wage. as far as minimum wage, there is you could take a young person in and make a profit or any money. give whatever the

minimum wage is right now and they go up, but most employers do that already. that keepsow anybody anyone at the minimum wage at present right now. if the person is a person to for, or a person willing progress, usually, the problem thatou get people in either, it is a drug problem or they do not have a work ethic, and that is a big problem in the country today. that is why we are having trouble and you get some of the immigrants in that are willing to work longer and harder than most of the americans. >> there was a lot there, but thank you for the call. having a good wage for construction workers makes a lot

of sense. the workers deliver projects on time and get a high quality job. how we to think about today.e of our problem high wages are not our problem. the problem is grotesque inequality. we have had a couple of decades where average people have been working harder and have been more productive than ever an innovative and are earning less than 20 years ago. forng good wages construction workers is a good thing. they are sending their kids to college. i disagree with you there about whether that is a problem in the economy. in terms of the minimum wage, we saw a lot of folks getting stuck at a minimum wage, whether or not they are good employees because we have a week economy and a week labor market. areas when of the the government set the minimum wage, employers can adjust and we see good things happening.

we see that people have enough buy the basics for their families and they are out of poverty and they do not have to get public assistance, which is what happens to a lot of these workers. you essentially see the government subsidizing employers who play -- pay low wages. eight-week -- -- a tweet -- sure, but we are nowhere near that right now. the level of inflation would be over $10 now. dangert think we are in theeing in a place where minimum wage will choke off employment opportunities. >> are there union members who make the minimum wage? >> not many. you have a contract, you

bargain for something better than minimum wage. a union is going to bargain for wages that are better than that. when we fight for a higher minimum wage, we do that for all workers in america because that is the right thing to do. anyone inthink america should work full-time and be in poverty. >> how much of your resources and time will you put into this effort? of resources a lot and our unions and members believe in this. we will call congress and put pressure on both democrats and republicans to make sure it goes through congress in a timely way and get it done. to see an indexed

>> did you have unemployment benefits? and were you part of the 1.6 million that lost them -- we are going to do everything we can to get you the unemployment insurance. we need folks to call congress and tell them how important that this is, and tell people that if they don't vote for the unemployment insurance extension, then people will remember at the ballot box in november. this is very important. >> glenn, you are up next in kentucky, democratic collar. >> good morning. women draw less on the social care requirement than men do.

did, my as much as i wife was making more than that. that is all i have to say. >> i don't know the answer to that, i am sorry. i don't know why there would be an equity. >> oklahoma, republican caller. you're on the air. >> how are you today? >> doing fine.

him any incentive -- big source of this over the years. us,labama has this week for employers hire people because they need labor. wage is the wage, the need still exists and it will cost more to fill it. the retail federation says it will come from somewhere. either they are going to reduce their labor force, not hire as many people, or it will cost more. >> there are two other things. if productivity increases, employers can pay more to

workers, and not suffer productivity or the terms of their profits. if they had more money in their pockets they are buying more hamburgers, or whatever it is, going up to the coffee shop more so you have a better demand through the economy. they are offsetting pieces as well, it is not a zero-sum game there. another issue that the president -- another issue the president talked about is that they must offer citizenship -- it does not mean they would never get citizenship or a green card, just of the hope is what it is, it would be fools gold, talking about the possibility of the gop immigration plan. good: he has laid out a position here on comprehensive health care reform, with democrats in the chamber of commerce on this.

this is an important thing for the economy and for the folks here who don't have basic protection in the workplace protection. know this comprehensive immigration reform has stalled in the congress. we are really focused on making sure that we maintain that path to citizenship. what are you hearing about republican support in the house who the key to citizenship, would be key supporters for you in the caucus? we have supporters on the business side and have been working closely with those on the business side in the senate has more bipartisanship on this issue. i am not sure where it all comes down. there is pressure on the republicans and democrats to do the right thing. we have a rising majority of latino citizens and immigrants and it is important that we put in place policies that are sensitive to the concerns that

they are facing. i think republicans face that challenge as well as democrats. host: this is from the front page of the "wall streeett journal" --that harry reid deals a body blow to obama on trade, saying he does not think. i don't think people should push that issue right now. isst: senator harry reid clear on this issue, that the authority that has been talked about and introduced in the senate by senator baucus, is going nowhere. he is not going to put it on the floor and i think that is great. i think that is the right message right now. the trade policy we have right now is not working for american workers. it has cost us a lot of jobs and impedes on the ability to have consumer safety protection and environmental protection and i think what harry reid's

messages, his comeback with a different trade policy that is more sensitive to the workers and the environment and consumers. but in the meantime, forget about it. what are the trade deals that are right to come to the floor? the transatlantic and the transpacific partnerships. one with europe and one with asian countries and latin america and the pacific rim. the transpacific is closer to being done, being negotiated between 12 countries and it could be one of the last that we ever signed because the idea that countries will join that agreement in the future. we are very skeptical, from what we see and from what we have this is something that could have enormous economic impact on the united states and

american workers and jobs for decades in the future. we have an following very closely. that is really in the embryonic stage. it just started. but some important concerns about regulation and how we can harmonize the regulation in the united states. how we make sure that this agreement is not used as a way to undermine the protections that we put in place. supporters say that this is not nafta and it will not have the same impact and if the united states does not strike these deals, other countries will come in and be invested in these emerging markets. congress is not part of either of these deals right now. host: the pacific countries. guest: i think we need to do something better than this, and put forward a new agenda for trade. a slowrstand we are in

economy and we can't turn our backs on that, but we want the government to lay down a new set of rules because we think the trade policies that have been put in place really have not delivered and have encouraged outsourcing and we have lost a lot of jobs in the manufacturing sector. these agreements are not different from the nafta trade agreement. productivity increases with technology, resulting in the need for fewer workers all leading to oversupply of labor. higher technology can also lead to wealth. as is what i was told as a kid a long time ago. if we have fabulous scientific developments we all have to work -- and if we are more productive we can enjoy a better standard of living with less work, we can have more things and it is not a question of more labor versus less labor. the technology and the productivity growth and also the

massive move to any quality, with the tax code and trade policy and other policies that have exacerbated this problem of any quality. is there a cap on how much people can make? --guest: i think we need a fair tax system, where folks pay their fair share and we don't have that right now. they pay lower tax rates than their secretary does, and that is not fair. in westport kentucky, democratic color. hello, bruce. caller: how are you doing today. i think the unions lost a good supporter with pete seeger, he just passed away about two days ago, i believe. unionism,rie promoted try to organize the okies, was a

minor workers in california. pete seeger was an amazing human being, a great singer and songwriter but also a great human being. he would stop by local labor halls, and this was a tremendous loss and we will all mourn his loss. do you have a voice like that for the labor movement today? bruce springsteen sings about working people and the challenges that they face in his own way and we have a lot of artists and singers, who still sing about the labor experience, and that is a wonderful thing. alexandria, virginia, republican collar. caller: good morning. i would like to ask one question. if you have a small company of 21 employees and seven of them are minimum wage -- if you pay three dollars per hour, and

three dollars into each of the other 14 people, it would raise costs to $60 per hour. raise't that have to accordingly,oducts would they be much better off if everything got more expensive of them to purchase. every business will have to make whatever adjustments that they make, if they stay around longer and you can invest in training and so on, you can make productivity gains and that is what we see from the research, when workers are paid higher wages, there is less turnover, and higher productivity. each business has to struggle with that and make the right decision for them. hopefully it is something that is good for everybody. and will help the businesses and the workers.

host: houston, texas. you are on the air with thea lee , deputy of the afl-cio. caller: i would like to make it official since i have waited for 30 minutes here. the first thing i would like to say is that walmart, one of the largest employees that we have here can afford to pay their employees $10 per hour. the unitedl 40% of or i should say they encourage as much money as the lowest paid employers here in the united states. i have noticed a few times that i go in, they no longer have checkers, they have self

checkouts, that means they are making more money. so what happens to their employees. taxpayers, it is not fair, and since i am retired i am looking at this, the republicans seem to always be on the side of the rich people and until we, the people of the united states get involved and know what is going on, you will always have people calling in, saying not to raise the minimum wage. i would like for those people to try to live on minimum wage. the other thing i would like to say is you mentioned something about if there should be a cap on payments, to the higher-ups -- there should be a cap on the amount that they can claim, on their income tax. that weould be no way

-- on the insane amount of money. >> i got your point. thank you so much for your call. i assume we are talking about walmart, and enormous company that can absolutely afford to pay its employees. this is the richest family in the world with billions of dollars between them, they have more money than many small countries. this is a company that has been enormous sleep possible and they need to do the right thing and they should pay their workers at least $25,000 per year. they can afford that and it would be good for their business, and it would have a huge impact on the overall labor economy. i think that is the right thing and i appreciate your call and your sentiments. i think this is a separate issue. whether companies can adopt the

full amount of the ceo salaries and if there should be an amount where at some point the government says, you can pay your ceo wherever -- whatever you want to pay but don't claim this as a legitimate business expense. the other thing that is put forward is raising money for financial transactions which would raise a lot of money to invest in things like infrastructure and education, things we need for this economy to be successful going forward. >> she cited the 40% that walmart has control over. are you familiar with this? walmart is the single largest private employer in the country. it is enormously important and influential but if they did the right thing, a lot of other countries would do the right thing. other countries -- companies would have the competitive edge for the unionized companies -- >> she also said republicans

need to talk more about income inequality. -- morris-s-rogers goprs gave the official response to the president's state of the union address and this is what she had to say on income inequality. americansnth more stop looking for a job and found one. too many people are falling further and further behind because right now the president's policies are making people's lives harder. republicans have plans to kos -- close the gap. plans that will focus on government bailouts and red tape. we are working to expand the economy. with nursing degrees and small businesses at a time. we improve training systems so that you have the choice to determine where your kids go to school.

skill training is modernized. host: your reaction? guest: part of the problem is that the economy is coming out of this long, deep recession. republicans in congress have blocked a lot of the measures that could be creating jobs right now. whether this is unemployment insurance or minimum wage. we do see the republican party as blocking some of the most important measures that we need to address inequality. i don't agree with ms. mcmorris rodgers -- host: one viewer says we are losing more with obamacare, we are losing hours and pay and increased prices and fees. obamacare has barely been limited and we need to give this a chance.

at some point things will settle down. this is barely implemented as the key, causing job losses -- is the afl-cio satisfied with the way that obama has handled the affordable care act and the law itself? not entirely. i don't think anyone is satisfied with the affordable care act right now but this is a work in progress. this is a fact of life and we don't want to see this repealed. we want to see this go forward -- and there are certainly concerns that we have. host: what with the unions like to be changed? guest: there are some dividends for union employers and the way they provide health care. that is sensitive to that, and we want to make sure that -- of rule is put

in by the agency, what kind of language are we talking about? it is technical, but i think that as the act is fully that there, we see have been concessions made to employers and we want to make sure that the workers that we have raised -- and the plants that we have is get -- are getting equal consideration with the concessions that have been made on the employer's side as well. host: nick is next, democratic collar. caller: what you are talking about, the employers -- the right to hire their own workers. theeems that they will be ones that will rule -- i want to know your opinion on that. any details't have on that situation so i don't want to bumble in there without any background. i'm afraid i don't know. [indiscernible]

ed, columbia station, ohio. president's state of the union, it was like santa claus. we have a larger budget than last year's budget, it is outrageous. they have taken more revenue and the one republican said -- we would write that off in 10 years, and get out of that. there is a $3 billion surplus there, look at detroit, run by unions and democrats for 50 years, is bankrupt. you follow this class warfare and you blame bush for the economy, for five years, you are still blaming bush. regulations made this year across the country. i have many friends in

california, i am a private contractor who pays more than unions. but a worker from the union taxes, noi do bridges, no roads. federal unions work three hours out of an eight hour day. the break lasts 20 minutes. that was from clinton, that was a total waste. that is why china takes everything. host: let's get a response for the accusations made against union workers. to remembertrying where it began about the economy and the job loss. host: using california as an example. guest: i really don't know what to say. movement is here, advocating for working people and some basic fairness. we have had a very weak economy for a long time. you talk about the government being too big, with the overall

government budget and the spending and so on. as an economist, i look at the economy and say that you had a long time of unemployment, what you do need in that time is for the government to step in and do some things that need doing. private contractors can't find this -- fund this on their own. andgovernment can do that this is the time the government should be doing that. tos creates job -- jobs fulfill the country's future. becausehad a deficit for decades we did not invest in the infrastructure. this may be a place where republicans, democrats, business and labor can't agree. they play a big role in education. we need a solid education system and i think because america is a big country, with the kind of opportunity we want, we don't want to provide that to the private sector, we want to make

sure the government can do that. economy, it is important for the government to play -- -- an important part for the government to play and unions play a part in that role and we will make sure that the economy is working for everybody and not just the top one percent. host: a little background for thea lee, the deputy chief of staff for the afl-cio, she was the that the chief of staff and the international trade economist and the editor of sense" magazine and her research has included reports on nafta, the impact of trade inequality on the domestic steel and textile industry. jacksonville, florida. independent color. go ahead. the minimum wage, i feel like they shouldn't raise it in some ways and in some ways i do.

hours, you over 30 don't have the time to go look for another job. i think that should be enough to take care of yourself. i know college students and high school students who don't need to be paid $.10 per hour. if you are working at mcdonald's and you flip burgers, that is not necessarily mean you should get paid $10 per hour. the bottom line is this. at welfareking more and making welfare certain andnts of time in the year, the benefits through your whole life -- it should be like minimum wage. do that and then move on with your life, thank you. guest: thank you for the call. it is one question, if i still workers flipping burgers should

get the minimum wage. there are a lot of people trying to support their families and -- it is good for the economy if everyone is earning a decent wage. not absorbentr is amount. cuttingr thing about welfare in time limits thomas that was done under president bill clinton. the so-called welfare program there is not an unlimited amount of time. now,of the problem right wage, peoplenimum who are doing everything right are still not able to see their families and they are dependent on food stamps and welfare. that is not right because the wages are so low that the government is subsidizing employers. who are not doing the right thing and that is what we want to fix. i want your thoughts on

the federal reserve. 's last day is friday. the fed cuts back again on stimulus with a second time in six weeks. >> this is a dicey time. thefederal reserve has responsibility for keeping the economy going, and for addressing both unemployment and inflation. we are very far from full employment. we don't want to see any premature cutting back by the federal reserve when the economy is so weak. we still have almost seven percent unemployment. it is important to still get back the macroeconomic stimulus. we are looking at our first female federal reserve chair, a wonderful economist and a great person. we have a lot of faith in her and look forward to what happens next with the federal reserve. host: do you know her? guest: i know her a little bit from academic work.

-- stocks tend to fall when the fed changes hands. 's last day bernanke and then janet yellen will take over at the federal reserve. lee -- tennesseelive in where president obama is expected shortly. speaking about education in this high school in nashville. >> the image and likeness of god that you place all around us in the beautiful faces of our fellow brothers and sisters. we also thank you, for the bold and courageous brilliant and audacious passionate and prophetic 44th president of these united states of america. we thank you for president barack obama. and we ask that you would

continually order his steps, manage his thoughts, anoint his -- decisions, that will enable this country to reach her and greatestighest potential under his leadership. we asked for the presence and power of your spirit to be right here in this avockfic place, called mcg high school and you would be a comforter and a lifter, a helper and a healer, for the administration and faculty and students of the school, not only celebrating what they have done educationally, but lifting them -- through this season of bereavement and loss. give them hope and grant them peace, show them love and be true to your promise, wiping

every tear from every eye, and reassuring both them and all of us that joy does indeed come in the morning. prayer, we our listed in the majesty and power of your wonderful name. men."very heart say "a [applause] >> to introduce the president of the united states's, welcome student body president ronald elliott. [applause]

>> friends, family, and distinguished guests, welcome to mcgavock high school. this is a great time to be a student in the nashville public schools but a better time to be a student at mcgavock. collegegreat time to be and career ready, this is a momentous day with all of our achievements and our wall-to- wall credit academy, the increase in attendance and graduation rates, and rising test scores are evidence of that. clearly our efforts have not gone unnoticed. mcgavock families and distinguished guests, without further ado, i present the president of the united states, barack obama. [applause]

>> hello, raiders. thank you. thank you, everybody. it is good to be in nashville. here --od to be reverend thank springfield for your work and the prayer, i want to thank ronald for the great introduction. [applause] he is going somewhere.

and he looks very sharp in that bowtie. i want to thank the mayor of nashville for having us here today. --you have 2 outstanding members of congress who are here. steve cole and jim cooper. [applause] acknowledge one of the finest public servants that we have ever had, a native of tennessee -- mr. al gore is here as well. [applause] two the superintendent and your outstanding principal and all of the teachers and most importantly, the students, -- [applause] as well as all of the parents who are doing an outstanding job, i just want to say, thank you.

i wanted to come here today because i have heard great things about this high school. and all of you. recognize that in the past couple of days it has been hard. it has tested peoples spirits. some of you lost a good friend. michele and i have been praying for everyone in the community, and all of us are sending prayers to those families that have been so directly impacted, it has been heartbreaking. i have been planning to come to the school for a while because you have made great strides. you have made great strides and the reason you made great strides is because you have worked hard to get it. way, those of you have seats, feel free to sit down. those of you who don't, don't. [laughter] you have been there for each other. ahead, ieks and months

hope that you keep being there for each other. helping each other through challenges and difficulties. this community cares about you and this country cares about you and we want to celebrate what thehave achieved because message i want to send here today is that we want every child to have every chance in life. chance of happiness and every chance of success. [applause] on tuesday i delivered my state of the union address. [applause] what i was going to say, right at the top, was the state of the union is cold. but, what i instead focused on, is a very simple but profound idea.

heart of who we are as americans. it means that no matter who you are and what you look like and where you come from, if you work hard, if you live up to your responsibilities, you can make it in america. [applause] and that is the chance that this country gave me. i am not very different than a lot of the students who are here except that i was perhaps more irresponsible. i was raised by a single mom with the help of my grandmother and grandfather. money,not have a lot of and sometimes my mother was struggling because she was raising two kids, and also trying to go to school herself. we lived overseas for a time. eveny mother emphasized then, why i was six or seven or eight years old, that your ticket is an education.

overseas she was was worried i would fall behind so she used to wake me up before sunrise to do my correspondence courses, to make sure i was keeping up with my american schooling before i went to school over there. eight,you are seven and you are waking up at 4:30 or 5:00 in the morning, you are not feeling good. i would grumble and complain and she would say, this is no picnic for me either, but she her son, andat if later her daughter, my sister, that a good education and even if we didn't have a lot, then the world would open up to us. and with that support structure started at home, but extended to teachers and communities, a

country that was willing to give scholarships, folks who are willing to give me a helping hand and second chances when i made mistakes. through all of that i was able to go to some of the best colleges in the country, even though we did not have a lot of money. wife, the daughter of a blue-collar worker and a secretary was able to go to some of the best schools in the country. we were able to achieve things that our parents and our grandparents could never imagine. could have never dreamed of that. i want every young person in america to have that same chance. every single one. that is why in my speech on tuesday night i laid out an agenda where we need to grow our economy and we need to strengthen the middle class, we have to make it easier for folks to work their way into the

and an opportunity agenda that has four parts, more new jobs, making sure folks have the skills to fill those jobs, making sure that we are rewarding hard work with a theng wage and income, and thing i'm here to talk about right here, guaranteeing every young person access to a world- class education. [applause] >> now, sometimes we only hear the bad news. i want to report on the good news. have made progress with education in america. our high school graduation rates are the highest they have been in 30 years. [applause] the dropout rate has been

falling, and the latino dropout rate has become half over the last 10 years. [applause] office, we took on the financial aid system running to the banks, that was good for the banks and was in good for students. providingd it, billions of more dollars to millions of more students and now we have more young people graduating from college than ever before. [applause] this park reform, five years ago we turned into a competition we call the race to the top, to promote innovation and reform in america's schools. tennessee was one of the first states to win that competition. [applause] and, because of that commitment, bringing together education and parents and elected officials and state and the federal level,

because of all of that, you are the fastest improving state in the nation. [applause] teachers more support and founded new ways to identify and reward the best teachers. in have made huge strides helping young people learn the skills that they need for a new economy. skills like problem solving and critical thinking. science and technology and engineering, math, and in nashville alone you have boosted graduation rates by almost 20% in about one decade. that is something you should be very proud of. [applause] take the lessons that we have learned and are learning, in terms of what is working, to make sure that your schools are able to do some of the things that you are doing.

and how to build on what work's. do that, we have to reach more kids. we have to do it fast. because in my experience there is no child that we should let slip simply because of politics or because of -- because adults can get their act together. so here's where we should start. research shows that high quality early education is one of the best investments we can make in a child's life. we know that. and it's not only good for the child, it's a smart investment. every dollar you put in early childhood education, the government, taxpayers take $7 because you have fewer dropouts, fewer teen pregnancies, fewer