many advanced economies are observing a similar softness in inflation. to some extent, the low rate of inflation seems due to influences that are likely to be amporary, including deceleration in consumer energy declines inoutright core import prices in recent quarters. inflation expectations have remained remarkably steady, however. we anticipate that it is the transitory factors subside and labor market gains inflation will 2%.ually move back toward in some, the central tendency of pro swreksesant for the unemployment rate -- projections for the unemployment rate at the end of 2016 is 5.2 for inflation the

to 2%. tendency is 1.7 if this forecast was to become a would bethe economy approaching what my colleagues maximum employment and price stability for the decade.me in nearly a i find this baseline outlook plausible. of course, if the economy ouriently followed forecasts, the job of central easier.would be a lot and their speeches would be a shorter. ( laughter ) alas, the economy is not often so compliant. so i will ask your indulgence for a few more minutes. because the course of the uncertain, monetary policy makers need to carefully is dayor signs that it verging from the baseline

in aok, and then respond systematic way. let me turn first to monitoring three questions i believe are likely to loom large ongoing assessment of where we are on the path back maximum employment and price stability. concerns thestion extent of slack in the labor market. fomc's objectives is to pro meat a return to maximum employment. but exactly what conditions are consistent with maximum can be difficult to assess. tos far in the recovery and this day, there is little question that the economy has far from maximum employment. difficulties were not our focus. attainment of our

maximum employment goal draws nearer, it will be necessary for the fomc to form a more nuanced judgment about when the recovery of the labor market will be complete. as the fomc state on longer term goals and policy strategy emphasizes, these judgments are inherently uncertain and must be based on a wide range of factors. the shortfall in employment relative to its level asonsistent labor market slack. and there are a number of indicators of this slack. probably the best single the unemployment rate. is now slightly more than one percentage point above the 5.2 to 5.6% central tendency committee's projections

for the longer run normal rate.oyment this shortfall remains significant. baseline outlook, it will take more than two years to close. other data suggests that there may be more slack in labor markets than indicated by the unemployment rate. share of thethe work force that is working part-time but would prefer to full-time remains quite high by historical standards. similarly, while the share of workers in the labor force who unemployed and have been looking for work for more than six months has fallen from its peak in 2010, it remains as high the greate prior to recession. there is ongoing debate about why long-term unemployment

remains so high and the degree to which it might decline in a more robust economy. fully in a more recent speech, i believe that mighterm unemployment fall appreciatably if economic conditions were stronger. forcew level of labor participation may also signal additional slack that is not the headline unemployment rate. participation would be expected to fall because of the aging of the population. decline steep ended in the recovery. although economists differ over of those currently outside the labor market might the labor force in a stronger economy, my own some portion of the decline in participation likely slack.s labor market totly, economists also look

wage pressures to signal a tightening labor market. present, wage gains continue to precede an historically slow in this recovery. with few signs of a broad based acceleration. at the extent of slack we see diminishes, however, the fomc will need to monitor these marketer labor indicators closely to judge how remains and therefore monetarymodating policies should be. a second question that's likely heavily in our assessment of the recovery, is is moving backon toward the fomc's 2% longer run envisioned in our baseline outlook. fomce most recent statement emphasizes, inflation 2% could poseelow

risks to economic performance. strives to avoid inflation slipping too far below 2% objective because at very rates at first economic developments could more economy -- the adverse developments could push deplace.my into once it starts, deflation can entrenched and associated with prolonged periods of very performance. a persistent bout of very low inflation carries other risks as well. with the federal fund rate its lower limit, lower inflation translates into real value for the federal fund rate. limiting the capacity of monetary policy to support the economy. long-termith

inflation expectations anchored years, persistnt inflation well below the expected value increases the real burden of debt for households and firms, which may put a drag on economic activity. will mention two considerations that will be important in assessing whether inflation is likely to move back recovers.he economy first, we anticipate that as slack diminishes, it will exert less of a drag on inflation. however, during the recovery, of slack havels seemingly not generated strong downward pressure on inflation. we must therefore watch carefully to see whether diminishing slack is helping return inflation to our objective.

second, our baseline projection that inflationew expectations will remain well 2%, and provide a natural pullback to that level. of that pull in the unprecedented conditions we is something we assess.tinue to finally, the fomc is well aware that inflation could also to rise substantially above 2%. at present i rate the chances of this happening as significantly of inflationnces persisting below 2%. preparedst always be to respond to such unexpected mycomes, which leads to third question. factors continuously buffett the economy, so the was always be asking,

what factors may be pushing the recovery off track. example, over the nearly five years of the recovery, the has been affected by greater than expected fiscal states, andunited by spillovers from the sovereign crises of someg euro area countries. baseline outlook has changed as we've learned about the degree of structural the economy brought by the cries and is the subsequent healing. let me offer an example of how these issues shape policy. april 2010,go, in the outlook appeared fairly bright. lending programs at the federal reserve implemented at the height of the been largely wound down. and the fed was soon to complete its first large scale asset

purchase program. forecastersor polled in the april 2010 blue thatsurvey were predicting the unemployment rate would fall steadily. the final quarter of 2011. quiteorecast proved accurate. the unemployment rate averaged the fourth quarter of 2011. but this was not the whole story. in april 2010, blue chip expectedrs not only falling unemployment, they also expected the fomc to soon begin raising the federal funds rate. indeed they expected the federal to reach 1.3% by the 2011. quarter of by july, 2010, however, with theth disappointing and fomc expressing concerns about both growth and

inflation, the blue chip fundast of the federal rate in mid 2011 had fallen to 0.8%, and by october the forecasters expected that the remain in the range of 0 to 25 basis points throughout 2011, as turned out to be the case. expectations of policy tightening recede, the also initiated a new $600 billion asset purchase in november, 2010. thus, while the reductions in the unemployment rate through 2011 were roughly as forecast in early 2010, this improvement only came about with the fomc providing a considerably higher level of accommodation than anticipated. this experience was essentially the following year.

chipril, 2011, blue forecasters expected the unemployment rate to fall to 7.9%, but fourth quarter of fomc expected to have already raised the federal by midte to near 1% 2012. as it turned out, the rate forecast was once more remarkably accurate. but again, this was associated with considerably more anticipated. than in response to signs of slowing activity, in august 2011 the fomc for the its forwardpressed guidance in terms of the calendar. wouldg the conditions likely warrant exceptionally low rates for the federal fund at least through mid 2013. month theing

committee added to accommodation by adopting a new balance sheet as the maturity extension program. thus, in both 2011 and 2012, the actuallyent rate declined by about as much as had year,orecast the previous but only after unexpected weakness prompted additional accommodative steps by the federal reserve. that theases i believe fomc's decision to respond to signs of weakness with additional accommodation played an important role in helping to projected labor market recovery on track. episodes illustrate what i described earlier as a vital as effective monetary policy making. economy for signs that events are unfolding in a manner thanifferent

just --, and it adjust policy in response in a systematic manner. will turn from the task of monitoring to the policy response. to modern thinking on central banking is the idea moremonetary policy is effective when the public better and anticipates how the central bank will respond to conditions.nomic specifically, it's important for to make clearnk how it will adjust its policy to unforeseenonse economic developments in the reduces or blunts potentially harmful consequences. if the public understands and to behavelicy makers in this systematically tendizing manner, it will

to respond less to such developments. thus haveolicy will an automatic stablizer effect privaterates through sector expectations. note thattant to tying the response of policy to necessarily makes the future course of the federal rate uncertain. but by responding to changing circumstances, policy can be most effective at reducing course ofy about the inflation and employment. duringhow this worked the couple of decades before the crisis. theriod sometimes known as great moderation. tool, the main policy federal fund rate, was well above zero. leaving ample scope to respond to the modest shocks that duringed the economy

that period. many studies confirm that the response of policy to those shocks could be degree ofwith a fair accuracy by a simple rule toking the federal fund rate the shortfall or excess of employment and inflation relative to their desired values. rule provideslor one such formula. that monetary policy should react in this systematic theer in order to blunt effects of shocks has remained policy in the fomc's making during this recovery. of this the application idea has been more challenging. with the federal fund rate pinned to near zero, the fomc has been forced to rely on two lists -- two less familiar policy tools. the first one being forward guidance regarding the future

setting of the federal fund second being large scale asset purchases. testedre no time guidelines for how these tools should be adjusted in response the outlook. as the episodes recounted earlier illustrate, the fomc has to adjust itsry policy tools in a systematic response to new information about the economy. tools ande both the the economic conditions have been unfamiliar, it's also been critical that the fomc it expects tow deploy its tools in response to outlook.changes in the let me review some important elements in the evolution of the fomc's communication framework. initially began

tools,ts unconventional policy communication was relatively simple. in december, 2008, for example, expected the it conditions would warrant keeping zeroederal fund rate near for some time. this period before the liftoff the federal fund rate was increasingly specific and as it turned out periods over time. sometime became an extended period. which was later changed to mid late 2014, then mid 2015. this fixed calendar based ofdance had the virtue simplicity. but it lacked the automatic property of

communication that would signal the stance of policy and forward guidance might unfolded.developments and as we learned about the extent of the need for accommodation. more recently the federal might add other central banks around the world, incorporate this automatic stablizer feature in communications. in december, 2012 the committee reformulated its forward guidance, stating it anticipated that the federal fund rate would remain near zero, at least as rateas the unemployment inflationbove 6.5%, over the period between one and to years ahead was projected be no more than half a percentage point above the objective and longer

term inflation expectations well anchored. this guidance emphasized to the on ac that it could count near zero federal fund rate at progressil substantial in the recovery had been achieved, however long that might take. when these thresholds were ratenced, the unemployment was reported to be 7.7%, and the projected that the 6.5% threshold would not be two and ar another half years. in mid 2015. committee emphasized that these numerical criteria were raising the for federal funds rate, and chairman ultimatelyated that any decision to begin removing accommodation would be based on range of indicators. our communications about asset

purchases have undergone similar transformation. the initial asset purchase programs had fixed time and limits, although those provisoame with the that they might be adjusted. in the fall of 2012 the fomc its current purchase program, this timex place italy of the programe to evolving economic conditions. when the program began, the rate perurchases was $85 billion month, and the committee indicated that purchases would providing that inflation remained well behaved a substantials improvement in the outlook for the labor market. based on the cumulative progress toward maximum employment since program,ation of the and the improvement in the outlook for the labor market, fomc began reducing the pace

lastset purchases december, stating that if broadly information supports the committee's expectation of ongoing marketment in labor conditions and inflation moving back toward its longer term objective, the committee will likely reduce the pace of asset purchases in further measured steps at future meetings. purchases are currently $oceeding at a pace of 55 billion per month. consistent with my theme today, fomc statement underscores that purchases are preset course. the fomc stands ready to adjust of purchases as warranted, should the outlook change materially. at our most recent meeting in reformulated its

forward guidance for the federal fund rate. the main motivations for this change was that the soonloyment rate might cross the 6.5% threshold. is also welllation suited to help the fomc explain policy adjustments that may arise in response to changes in the outlook. i should note that the change in guidance did not indicate a change in the committee's policy intentions, instead was made to clarify the committee's thinking about the economy continues to recover. provides adance general description of the framework that the fomc will decisions about the timing of liftoff. specifically in determining how long to maintain the current range of zero to 25 basis

points for the federal fund the committee will assess progress, both realized and expected, toward its objectives 2%maximum employment and inflation. in other words, the larger the employment or inflation from their respective slower the and the projected progress toward those objectives, the longer the current target range for the federal fund rate is likely to maintained. this approach underscores the of theing commitment fomc to maintain the appropriate accommodation to important the recovery. the new guidance also reaffirms the fomc's view that decisions beut liftoff should not based on any one indicator, but that it will take interest account a wide range of

information on the labor market, financial and development. along with this general fomc provided an assessment of what that implies for the path of policy under our outlook. at present the committee anticipates that economic and conditions will likely warrant maintaining the current fund ratethe federal for a considerable time after program ends,hase especially if projected run belowcontinues to the committee's 2% longer run goal, and provided that longer term inflation expectations anchored.l finally, the committee began fully how policy may operate in the period after

liftoff. indicating its expectation that somemic conditions may for time warrant keeping short-term levels thetes below committee views as likely to longer run. in the fomc participants have cited view,ent reasons for this but many of the reasons involve persistent effects of the crisis.l and the possibility that the theuctive capacity of economy will grow more slowly. it didt for a time, than on average before the crisis. theexpectation that achievement of our economic requirees will likely low real interest rates for some not confined to the united states, but is shared advancedcross many economies. a course this guidance is forecast and will evolve as we

gain further evidence about how operating in the wake of the crisis in ensuing recession. in summary, the policy framework described reflects the fomc's commitment to totematically respond unforeseen economic developments, in order to return to maximum employment in the context of price stability. it is very welcome news that a return to these conditions has finally appeared in the medium term outlook of many forecasters. but it will be much better news reached. objective is my colleagues on the fomc and i on doing theused federal reserve's part to promote this goal. you. [applause]

>> thank you very much, chair yellen. tradition, is our two of our club members will conduct a question and answer session. our vice chier, senior strategist, and marty feldstein at harvard university club.trustee of the abby, the first question is yours. >> roger, thank you, and madam again on behalf of everyone here for your this importante presentation today in new york. clearly very clear and cogent another example of straight forward communication from the federal reserve. thank you for that. >> thank you. my first question, i'd like to go back to the problem earlier and that is the vexing and long lasting in theof unemployment

united states following the financial crisis. we see that beneath the national data which are improving, there a very wide dispersian in performance. big differences, for example, by gee ohing reafer in what some cities and some states are doing far better than others, and also byery dramatic difference education. much depends upon how much education and vocational training a worker may have. what is the role of the federal reserve in addressing these aspects of unemployment? other government policies might be helpful? and what other private actions helpful in finally getting unemployment back down levels?comfortable >> thank you, abby. i think you're absolutely right that the recovery in the labor has been exceptionally

slow. financial crisis, i think, lot of head winds that the economy has been to overcome. so we have indeed had a disappointingly slow recovery. expectationsstent for a pickup in growth have been number of years. behavingabor market is in some perplexing ways in that are novel. i agree with the points that you mentioned, and i mentioned some in my own remarks. part-time employment that's involuntary is remarkably high. pastmparison with any recovery. the length of unemployment seens is higher than we've

period.g the post war and labor force participation, mentioned, has declined a lot. our part you ask what role can the federal as ive play, and it is emphasized to continue to use adjust itolicy and to in light of changing economic circumstances, as we have over all these years during the recovery to foster healing of the labor market, a return to so-called full employment. the bestnk that's contribution that we can make. i do think we are seeing very meaningful progress, although clearly we're not, the goal has achieved at this point. you asked me also what role the public and private sector can

play. i think that we all know that there are problems in the labor deeper thanrun merely a weak economy. not just cyclical problems. inhave seen a rise inequality and pressure on wages middle and below of the spectrum, rising skill gaps in wages, at least going back to the mid 1980's. and economists of course debate the causes are of labor marketing trends. and there are a lot of ideas been put forward, change, trend in the global economy, and institutional changes. almost on anybody's list of what the private and public address thoseto

disturbing trends would be training and education, and clearly there's a great deal can do, and also i see state and local privatents and individuals obviously in making decisions about thoseng are responding to differentials in ways that i think will be helpful over time. >> thank you very much for a clear statement. hasou've indicated, the fed the two goals of low unemployment and price stability. because inflation is now very, very low, fed policy is focused on reducing slack in the labor market and raising inflation to about 2%. strongerme point, a

economy may bring higher inflation rates. fed be willing to raise the fed fund interest rate of inflation if risinglation rate begins above say 2.5%, even if there is slack in the labor market? me emphasize that our commitment is two-sided. we don't want to see inflation below our 2%tly target. seewe also don't want to inflation run persistently above our 2% target. years agobout two wanted to make very clear that very strong commitment inflationnger run

goal. and we for the first time issued clear statement that 2% is our weger run inflation goal and remain committed to it. case.ontinues to be the so although with inflation around 1%, at this thet as i mentioned i think risk is greater that we should inflationg about undershooting our goal and to 2%. inflation back up of course the fomc absolutely committed to protecting threatens toit rise persistently above 2% as well. and i hope it's completely clear monetary policy is very accommodative at this focused on the

need to keep it so or to adjust sure the recovery remains on track, as the proceeds and healing occurs, it's obvious that we monetary to tighten policy to avoid overshooting our target. and we're very focused on that, call thats a judgment the federal reserve needs to expansion.ry overshooting that goal, we've past episodes, in past recoveries, can be very to reverse. that's something we don't want to happen, so yes we will remain very focused on removing rightodation when the time has come. and i feel very confident that to do that andls also the commitment and will. making our objective of

inflation very clear, we did that in order to be transparent and to give the public a way to hold us achieving that goal. [applause] >> madam chair, the federal has been doing its difficult work during the global financial crisis and the aftermath really in a global context. currente look at the and forward situation, the two largest economies in the world, that of the united states and zone, seem to have some very significant differences. there are differences, for the pace of economic growth, both cyclical and long-term growth

prospects, in which the united states seems to be in better condition. and there also seems to be big differences in the condition of balance sheets. in europe there has been the spillover of the sovereign debt crises, and some other factors. how do these differences in and the current health of the financial system in the two complicate fed policy with regard to two different the decisionr one on policies related to economic also policies related to supervision and regulation? >> so, i completely agree that of the economic challenges facing europe and the united quite different. seeingause we are differences in economic globe, it around the

oflikely that the process removing accommodation will take paces indifferent world.nt parts of the and this will be a challenging the last year or so we have been very focused on spillovers of policies challenges that this differences in the likely pace policies pose of for developing economies for markets economies in a capital slowsobal respond to small shifts in about and expectations policy. we've seen that these shifting expectations have imposed some difficulties for emerging particularly in

managing policies. of europe, obviously the european situation is one high unemployment. there's been a return to growth, preceding at -- proceeding at a very modest pace at this point. there are challenges that we don't face in the united states ofoss the euro area readjusting competitiveness countries, and shifting current account balances among euro area.es in the being held europe is back by adjustments in their sector and problems in the banking sector that i think we have a much stronger banking sector in the united states. asked specifically about bank balance sheets and

supervision. and regulation. focused, bothy the federal reserve and other regulators in the united states globally working with our colleagues, to strengthen the financial system in the of the crisis to make strongerrganizations and to more broadly reduce that we are atso less risk of a financial crisis. that we'relieve making very meaningful progress in that task. much more and higher quality capital and more in the u.s. banking system. standardsised capital very meaningfully, particularly for the largest and most systemic firms. and as my colleagues and i have may be somehere will puthanges that we

capitalect to raise standards. the large firms and banking generally are well on the track to meeting those capital standards. themy perception of situation in the banking banksry at this point is look to lend, they want to provide credit, and they're recovery. the in europe i think the situation is different, but they've made meaningful progress, i think, in trying to form a will be aion that pillar of strength in europe and euro area economy. they are working very closely us to enhance capital standards, and to move forward maintain a level ofying field in terms

capital standards and regulations. think their economy, however, at this point is somewhat more constrained by the need of buildg organizations to capital. they've made quite a bit of think, toward banking union. and the u.c.b. as you know is in the process of conducting an asset quality review and stress tests that those were steps that were very important for us some years ago, i think, in putting organizations on the road to health and recovery. and i think they will be equally important in europe as well. >> thank you for the answer that questionto my previous about inflation. i found the answer very, very reassuring.

i want to stick with the subject younflation, and ask how will decide how the federal decide that the risk of inflation, that is the overshooting the 2% warrant high enough to a significantly positive real fund rate, that is how will you make sure that you are ahead thehe curve, not behind curve? alan kreuger of princeton short-termhat the unemployment rate, that is the unemployment rate for those out less than six months, might provide a good indicator. and i wonder if you agreed with that, and if not, what you would look at to try to anticipate above the 2%ng goal. will certainly be

looking at a wide variety of indicators pertaining to the labor market, and of course the performance of inflation, inflation pressures, expectations. measures, i noted in my market slack is wage pressures, that can pressuresinto price and be an early warning indicator of impending uptick in inflation. relationship between wage inflation and price inflation has been less close reliable in recent years. i indicatedu know, in my remarks that one of the the economy we will be focused on pertains to trying tomarket and

assess just how much slack there impact of thehe labor market is on inflationary pressures. mentioned, alan kreuger's work, there is a line that suggests that it is mainly short-term unemployment rather than long-term unemployment that has an impact on inflation. so it is conceivable if that of thinking is right that but with unemployment high short-term unemployment low, long-term unemployment high, if of thinking is correct, we could see that even unemployment rate by standards -- highly standards, inflationary pressures would be rising unemployed long-term according to that reasoning are placing less downward pressure inflation.

now, i think it's premature, frankly, to jump to that conclusion that that argument is correct. made some arguments in other remarks and they've given i think that the long-term unemployed are likely back more actively interest the labor force, and market and exert pressure on waynes and prices as strengthened.et but clearly we will have to unfolding evidence and evaluate it with an open mind in they carefulfully months ahead to make the beessments that will necessary. and i mentioned that there can be surprises, and one of the we could see -- i wouldn't rule out, it not what most likely, but would not rule out the possibility that inflation could levels where we'd need

to address it before we might expect at this point. so that is something we will be quite attentive to. not my, it is not what a anticipate will happen, but of my remarksose emphasize that there can be a lot of twists and turns. we need to be alert to what is in the economy, and to respond to what we see happening, and not a fixed idea that we perhaps held at some about what will come to pass. [applause] >> thank you, chair yellen, for these very insightful remarks to theo the answers questions, thank you, abby and thank you martin for the questions. the next meeting of the club be here at the marriott, on

monday, april 28, and the chairmanill be former of the federal reserve system, alan greenspan. so thank you for coming today please enjoy your lunch. thank you very much. [applause] month'srup group president and c.e.o., wes bush spendinguss defense amid budget cuts at the economic club of washington d.c. today. can you see at the vebility live at 8:30 eastern on c-span 2. >> this morning on c-span, defense secretary liam fox discusses n.s.a. and theance perhaps effect of the edward snowden leaks. then, president obama is in to announce a new job training initiative. and later, federal reserve chair janet yellen speaks about the economic recovery at the york.ic club of new of the duke

administrators early on were not the kids bad legal advice, which was essentially, parents, don't get lawyers, cooperate with the police, and basically this is away.to go so that gave duke, duke thought legal exposure because of that. and beyond that there was this desire to make this go away, to protect the duke brand, to make sure that, you know, once it was decided these kids were innocent that the last thing duke wanted was to try to then have to about all of them what had happened. so the easiest course of action just to pay them this $20 million and have them i sign nondisclosure, nondispar anment agreement, why theyps explains haven't talked to me and haven't talked to anybody since they settled. it's not exactly clear why

duke felt the need to pay these kids. get,now, people unfortunately, wrongly convicted all the time. like the are places innocence project who defend those kind of people and tries to reverse the judgment that were made. examples of people wrongly for murder, spending 18 years in prison, 18 years. $20,000 payment a year. as a result. you know, these kids spent, than their arraignment hour or two, no time in jail, no and gotprison, $20 million. >> in the price of silence, william d.duke alum cohen likes at the duke lacrosse 2006, sunday night at 8:00 on kra span's q and a. thursday, defense secretary polishaking expel the defense minister hold a join news conference to discuss russian intervention in ukraine, u.s.-poland relations and other

topics. live coverage from the pentagon 10:45a.m. eastern on c-span. also today, former british david millietary band, and robert ford discuss syria.arians efforts in we'll join their conversation at the washington institute, live on c-span.tern >> our colleagues have spent reiterating fact actually inaccurate information and i want to make sure we clear it up. independent guardianed alitem appointed to represent terry shy -- despite that terry felt was and laughed and cried inaccurate, that her cerebral core tens had been liquified and is the area of the brain

that ponds to emotion and reason, so that is impossible what they have detailed here tonight much aadditionally they talked about neurologists and physicians that see she is not in a vegetative state. also inaccurate. they have only viewed terry by videotape. the five court appointed positions that have examined terry, who have all examined board certified neurologist who had academically theirched testimony, testimony was deemed to be clear and convincing by the court that persistent is in a vegetative state. the other physician's testimony anecdotalnted as only. in addition to that, i want to just close with the commentary the guardian ad litem. he spend 20 of 30 days with her, put his face up close to her and contact,make eye

pleading, trying to will her into giving him any kind of sign. please,i would beg her, terry, help me. you want to believe there's some connection, you hope she's going bed and say hey, i'm really here but don't tell here,y, or i'm really tell everybody, but schiavo never made eye contact. her parents were there, she never made eye contact with all his pleading and coaxing, he never both what he most wanted, a sign. i felt there was something distinctive about who was notry is, but it there. night plagued by nightmares. >> the gentle woman has 15 seconds. >> thank you, he con included that the medical and legal evidence because the diagnosis persist tent vegetative state was credible, but he still felt that for those medical experts would never truly know where schiavo was. learn that and to

attorney for the schindlers schai --hat expired.me is >> find more highlights from 35 years of house floor coverage on page.cebook c-span, created by america's cable companies 35 years ago and to you today as a public service by your local cable or satellite provider. >> during this month, c-span is winningto present our surprise in this year's student cam video documentary competition. pan's annuals c competition that en currents mid toel high school students think critically about issues. the question we asked students to base their documentary on the most important issue the u.s. congress should consider in 2014? second prize winner matthew school is a junior at a in honolulu, hawaii, he would like congress to consider a energy plannewable

as his most important issue. the sunrises here in hawaii. every day the waves crash upon shores. every day the wind blows in the mountains. lava flowsay the just beneath the earth. but even though my state has within its borders abundant renewable energy, we still rely for over 80% of our needs. recognized that our dependence on fossil fuels was threatening our most resources. the land, the air, and the water. governments had a clear plan to move away from anditional energy sources to move towards a greener future. ladies and gentlemen of congress, this is something we need for our whole country. natural clean energy plan is the important issue for you to consider in 2014. your action to break the

clean energy gridlock. growing consensus that the use of fossil fuels contributes to common change, especially by forming carbon dioxide. is clear, the effect of climate change is real and urge expebility the basic climate change is simple. earth dioxide makes the warmer and we're emitting more and more of it boo the atmosphere. it's affecting the climate. >> more than 97% of climate are convinced that human caused climate change is occur, if our changing climate goes unchecked it will have devastating impacts on the planet.tates and on our >> this year the observatory on island measured 400 parts per million of carbon thisde in the atmosphere, level has not existed on earth years.r 800,000

the scientific consensus is motivating political action. i put forward to reduce carbon pollution and protect our country from the effects of climate change is the we need to take. and if we remember what's at oure, the world we leave to children, i'm convinced that this is a challenge that we will meet. >> but this is not just the job of the executive branch, it is the responsibility of congress as well. the commerce clause of the constitution says congress regulate interstate commerce, and energy whether renewable is a form of interstate commerce. president of the hawaiian electric industries to country's about our energy policies. >> the energy system in america has become more and more federal in nature, and more national in nature. now regulatory bodies that regulate the bulk power system.

power could be generated in one state, but then exported across that state's border, hence interstate commerce. >> today renewable energy policy as cross our nation, vary from next.ate to the some states regulate the amount of greenhouse gases they'll permit. require that a certain percentage of renewable energy be produced. states have energy efficiency requirements for cars or buildings. there's a patch work of renewable energy policies country.r >> the use of renewables across the united the use of renewables across the united states really varies significantly because the energy picture across the united states varies significantly. the parts of the united states that actually have very good wind resources primarily are through the middle of the country and then when you get

to the southwest you have excellent solar resources. and of course in the pacific northwest they have hired power. >> another reason is the states might not be able to regulate renewable energy by themselves. renewable supplies are intermittent and have to be coordinated with traditional energy to meet nationwide demand. renewable supplies also have to feed into the national grid along with traditional energy. since energy resources all across the country have to be integrated with each other a national policy for renewable energy makes sense. so far the state has taken the initiative in clean energy matters but action may be restricted by the commerce clause of the constitution. >> the commerce clause was to preclude individual states from actually impacting interstate commerce because of the idea was even though we're comprised

of 50 states we are one nation. and we should have open borders between our states. commerce should flow freely across state boundaries. and so there have been challenges to some of the state laws that have sought to restrict production facilities that were within that particular state. so the commerce clause may prevent the states. i understand why congress has not been able to agree on anything yet. new and energy is there is controversy about the role fossil fuels should play in our energy future. but these problems are not insurmountable. we face many of them on a smaller scale here in hawaii. >> in 2008, hawaii decided that it really needed to reduce its dependence on oil forever and

to goal is to actually move renewable sources by 2015 and then it goes up to 40% in 30e d in addition to that to reduce consumption by 30% through energy efficiency. d so that's a total of 70% clean energy by 30e. >> i'm not saying that congress should model its college policy on the hawaii plan. in fact, i'm not recommending any specific clean energy policy to adopt. i'm just asking that you make this your priority for 2014. ladies and gentlemen of congress, this is my message to you. it's time for national clrge plan. it's time to break the gridlock.

of course democrats it will always result in democrats taking power. thomas jefferson will take the

lead in all of this. but where you see these individuals i mean, the people in authority now, do any of them have a serious reputation as politicians who are democrats? you won't find any such individuals there. and now this suedo democrats. have they done anything? have they done anything to forge something that would have to the appearance of democracy? nothing but fights. they forcibly ejecting those who object to them. you have military camps. no one has been disarmed. and these democrats, these having established no democracy in kiev are now trying to enforce democracy, law and order some of our colleagues have said, through the deployment of armed forces and they're trying to enforce this in southeastern ukraine. this is virtually our take and a number of colleagues

approvingly refer to the elections of may 25th being prepared. we don't know how this will pan out. but what is our concern here? and what i do have to agree with my ukrainian colleague is i don't remember his exact words but there has to be an in-depth change as compared to the past. there has to be a break with the past. the ukrainian people are now being asked to buy a pig in the poke. go elect a president but what kind of solidty he will possess? what sorts of government will he preside? significant authority or perhaps will the prime minister has had more authority. and more power. but the elections will take place on may 25. will reform and then elections. no, this has been all reversed and now these elegses are being pushed forward where members of parliament are going to be

elected is this democracy? is this going to be breaking with the past? and now very last but not least in negotiate in geneva which i pe they take place if they are not undermined by some sort of action in southeastern ukraine they will take place. ut our western partners of ukraine ready? this is a big question to us and this is perhaps a small secret to you. we thought vauryuss format for involving representatives of the region as they're incapable perhaps for this format we could do so. of course the response was negative. let us see what all of the this and -- i'm referring to the geneva meeting of course. we hope that it leads to a ukraine which will engage on the path of normal development where all the regions would

understand clearly what their fate is tomorrow. all the religious, ethnic groups would understood clearly and then we will together look at the economic problems of ukraine. and this is dialogue which we invite our partners to participate in including in the well-known letter by president putin sent to a number of heads f european states. >> well, the thought comes to my mind that sometimes there is no point in making comments. because our russian colleagues in any case will stand by their position and their opinion and they will represent the situation the way they wish it to be seen. o this virtual reality which our russian colleagues are demonstrating when everyone says one thing but they live in

their own separate bubble of the world. whether you want or don't you will have to participate in the discussion on the issue of crimea because it is ukrainian territory. it is temporarily occupied. but until it is returned to us we will continue to discuss it. and we have seen the support demonstrated by the whole world o ukraine. it is unfortunate that when you're making your comments you're using words such as lies and so forth. it's a shame that your epresentative at the meeting which was head bid a well known human rights defender who sat in soviet jail for 15 years defending the rights of its people. and he said what i said. let us repeat his position. and you simply use lies and

provocations. the crime n will crr that you consider all this to be lies and provocation. and i have no further comments because everything that was said previous to this was nothing more than manipulation and a distortion in a style which is well known and familiar to all of us. thank you to all of you for our attention. >> the white house said wednesday that it has prepared new sanctions against russia and more talks are scheduled in geneva between russia, ukraine, the e.u. and u.s. you can see the entire meeting at c-span.org. >> on monday former british defense secretary liam fox wrote an op ed calling the edward snowden leaks treason.

next he speaks about government surveillance programs and privacy issues at an event hosted by the american enterprise institute. this is an hour. an event hostee american enterprise institute. this is one hour. >> good morning and welcome to the american enterprise institute. dr.re pleased to welcome liam fox. he is member of the british parliament and has served there for 18 years. he was the shadow foreign secretary and shadow defense secretary and became the actual defense secretary and served with distinction in that role. robust champion of defense and a champion of the men and women in the american

and british intelligence services who does much to protect us from terror and foreign dangers. that is what we're here to talk about. one of the most damaging leaks in the history of american and british intelligence. he declared edward snowden thinks of himself as a cyber age really warrior but in reality he is a self publicizing narcissist. limit not attempt to damage. let us call treason by his name -- it's name. we are pleased to have him here this morning. >> thank you. gchq calledead of the snowden lakes the most britishphic loss to intelligence ever. what is your assessment of the to bothhat has done and

our national security and yours? >> i think it is huge and you can see it at a number of different levels. first of all we know that 58,000 andes of very confidential secret information was leaked. that is damaging to our security weerests in themselves and can discuss that. it was also calculated to damage america's standing with its allies and damage the american diplomatic process which is in line with what i described as the anti-american and anti-western views of both glenn greenwald and edward snowden himself. he did not want to live in a world he said where everything was under surveillance and isrything was recorded but happy to live in an sfb -- naf safeafe house -- in a fsb house.

>> this morning james crawford said the terrorists and other adversaries are going to school on u.s. intelligence sources and that the insights they are gaining are making our job much heart -- much harder. you talked about how there are specific instances where there is chatter when the terrorists are changing their operating mode talking about avoiding certain things based on the snowden documents. >> yes, we have seen from our own intelligence how groups in south asia and terrorist groups that we don't pose a threat to us have been delighted to be told by edward snowden how the cyber security services went about intercepting communications. armed with that information they made sure to exploit the ways of talking to one another. i think there are three elements to the disclosures.

first of all, there was the extent of nsa surveillance. i think that if that was done within the law and the limitations imposed, that is a legitimate debate in a democratic society. and i think it would be hard to argue that it is stuck within those parameters, but that was not a useful public function. the second element, to go into what you just described, the means and mechanics by which the intelligence services go about their business is extraordinarily irresponsible and damaging. third, going in for the details on the actual names of agents and operatives? that is criminally irresponsible and, in my view, crime. i think it shows a total disregard for the people who were actually involved on the sharp end. the decent, patriotic people who put their lives on the line for our country, to disclose their names in public. we know that that has done a lot of damage in terms of the threats to them and our ability to deploy freely overseas. there are a whole range of areas. clearly, on that second, if you tell the enemies of your country how you go about listening to

their communications, the first thing they will do is find a different way. it is not just terrorist groups. this is a point that has been missed in the american debate. this is also about the ability of economic enemies to steal our intellectual properties and, in the long term, damage our national prosperity. it is also about dealing with pedophile rings, being able to break them up. the next time you get a bomb going off in the subway or a marathon, when someone's child is abducted by a pedophile ring, you might want to thank those who made it easier for those people to do those things. >> one of the secrets you pointed out was that not all of this has to deal with surveillance and civil liberties implications, and a particularly damaging leak was the revelation

that they have broken the communications systems of the russian presidency during the g 20 summit in london. it was reported by "the washington post" that right before the russian invasion of ukraine we did not have intelligence to indicate something was about to happen. do you see a connection between those things? has edward snowden damaged our ability to figure out what rush is doing in the ukraine? >> let's put it in the general terms. if you make it very clear that you have been able to get signal intelligence about particular ways in which communications take place, then it is very obvious that if that is compromised, you have to close down those channels and that will limit how much information you get in the future. so, we should not be surprised if we are less able to get an idea of what is going on in the world in terms of the information that we can get to

understand or preempt activities elsewhere if we have not closed down as a result of the compromises by snowden. why would anyone be surprised at that? >> mike rogers, the house intelligence committee chairman said that he believes that no one in the intelligence community doubts that edward snowden is now under the influence of russian intelligence. the only question is when he became effectively an agent of russian intelligence. do you agree with him? what was your assessment? >> i think that that is very hard to say. i would not want to speculate on that, i am not sure it is helpful. but what is clear is to look at his motivations, to say that, as i mentioned earlier, you don't want to live in a world of surveillance where what you say and what you do is scrutinized.

the first place you go is china? and when you regard the chinese embrace as insufficient to your taste, you had to moscow to be close to the fsb. this is a russia that not only invaded georgia, but let's look at it from a journalistic perspective -- a place where journalists are criticized in the press disappear. to have accidents and elevators. where the enemies of vladimir putin have terrible chances of having a premature accidents. in the united kingdom and seen u.k. citizens murdered by the fsb. this is where he chose to go. rather than living in the united states, he chooses to make his nest with the fsb. that is again a speculative matter, but what you can at least say is that his choices are very clear.

i remind you, those are deeply perverse choices. >> not all the snowden documents have been publicly released yet. we are getting this in trips and drabs. we will talk more about that in a minute. the chinese, do you think the chinese and russians basically no everything that he knew? is the damage done? is the counterintelligence much deeper than we realized? >> edward snowden was carrying these documents with him. if he was wheeling them around to the guardian and the united kingdom, and they were being transferred -- let's just talk about some of the security. when glenn greenwald's partner, maranda, was arrested, not only was he carrying a memory stick with 56,000 u.k. secret files on

it, in his pocket he carried a piece of paper with one of the codes for the encrypted files area that was the level of security by which they were doing this. not only did i think they had particularly ulterior motives, but it was more like james bond in the way that they were carrying it out, which would be comical if it were not so tragic and dangerous. i think we therefore have to assume that the places he chose to visit, china and russia, must have access to those particular documents, given that their own security was superior. one of the instance -- incidences from "the new york times," where greenwald travel to hong kong, they were walking up and down discussing the contents of these documents so freely that they would disturb in passengers around them. these are some of the national secrets that we expect

governments and its employees to protect for us. i think we have to assume that a great deal, if not all of this information was completely compromised. that has a lot of implications for the ways in which we carry out our security services, which are ultimately protection of everyone in this room and in our respective countries. >> glenn greenwald was very upset about his partner being assaulted, in his view, by british security services. he said it was an attack on free speech and the freedom of the press. but he was carrying stolen documents. is there any difference between that and, say, a drug smuggler or diamond smuggler stopped at heathrow? >> it was the smugness, the arrogance of it. this toxic combination of arrogance and incompetence has been one of the hallmarks of all

of this. of course, greenwald said -- you arrested my partner, therefore i am going to be much more aggressive in my reporting. i know lots of things about the english spy system that i am going to reveal. if you have the audacity to stop my partner at heathrow, i am going to purposely damage your national security as a consequence. what sort of world do we live in where that gets a feel it surprise for public service? >> let's talk about that. my newspaper was just awarded the pulitzer prize for that public service. "the guardian" has shared in that award. you have requested that "the guardian" be investigated. can you talk a little bit about whether the award was deserved?

>> well, whether it is an award for good journalism, as a politician you might not want to make a judgment on that. but an award for public service? for possibly the greatest the trail of our national secrets of all time? that strikes me as quite bizarre. i do think that there is a real danger of a very cozy media world padding itself on the back without really understanding the consequences for the dangers that we face in a very dangerous world. i think there is a dangerous disconnect there. as for the newspaper itself, my view was that if individuals gave the names of opportunists outside the u.k. jurisdiction, that would be a breach of the 2000 terrorism act in the united kingdom. if that applied to me as an individual, why would it not apply to a newspaper? this is

not about the privileged position of journalism, this is about equal application of the law. they are meant to apply to us all equally, not more favorably to some than others. i think that that applies also to newspapers. having spoken to the director of public prosecutions, we need a look at whether the guardian has in fact broken our main terrorist pieces of legislation as a consequence of mewling 58,000 highly secret pieces of british intelligence around, or indeed, more specifically, exporting outside the jurisdiction the names of operatives. that is an ongoing investigation by the metropolitan police. >> you have not received an answer yet? like i do not expect them to do so thickly. it is a serious charge to be made and it is a serious investigation that needs to be carried out. i think it is ongoing and will take its due course, but it is very important that we do so.

there are questions here about the relationship between government, civil service, and media. i don't think you can take the view that we don't want the media to be able to portray themselves as the victims of the state. the state's responsibility is, primarily, the security of its citizens. >> when i spoke to friends at the nsa, they told me that their british counterparts are absolutely flummoxed by the response to the leaks here and to the nsa surveillance activity. that the british surveillance activities have deceived very broad support in the united states. why is that? why does there seem to be some -- so much outrage in some quarters where it seems to be expected and supported where you come from? >> it is quite perplexing. from a conservative u.k. perspective, this debate has been very different on the two

sides of the atlantic. in the u.k., the view of the public has sort of been -- well, of course our spies spy. if they are not spying, why are we paying them? that, i think, partly comes from our historical experience and relatively more comfortable concept of what our security services do. and also our experience particularly in relation to northern ireland, where we saw the real threat on the u.k. man lands and relied a great deal on the security services to protect us. also, i think it is about comfort with oversight. there is a fairly good understanding that we have the prime minister appointment of the cabinet, an unelected cabinet where the foreign secretary has direct oversight and control over gchq and where the home secretary has control over the security service and we have the two external

commissioner judges wanted by the prime minister, you have the security committee in the house of commons. there is a confidence and understanding of that oversight. in the united states, the debate has been hugely focused on what the nsa does or is capable of doing in terms of civilian interception. rather than the other two elements, which i described as how the security services go about their business and the means by which they do so, the compromise of that, and its consequences. also, the impact it has on the personnel involved. i just find it strange debate. what have we learned so far? following the snowden

revelations? has anyone shown that any of this surveillance activity has been illegal under the oversight that is set out in the united states? under a system that is overseen by congress where permissions are given by presidents of whatever political color. the last two administrations were very different. it seems to me that the argument has always been hijacked by -- let's call it a lever terry and element in united states politics where i think insufficient balance has been given to the debate, watching it from a u.k. perspective, it seems to be rather odd. some of those i would normally have expected to be out there, outraged at the damage to the security of the american people, they seem to have been focused on whether the nsa have the ability to intercept the e-mails of people.

i find the balance of the debate difficult to understand. >> fascinating. as you point out in your piece, glenn greenwald, the guardian, some of these people are very openly anti-american, anti-western, yet they seem to have tapped into an opposition on the right in the united states over these things. do you think american conservatives have been duped by this a little bit? i this left wing cabal? >> i think it is a matter of priorities. it is a legitimate debate. let's face it, in any democracy, the level of surveillance that security services are able to have. and the level of oversight that they have, that is a legitimate debate. i just find it odd that the debate here has been so skewed in one direction without looking at what dangers our children are being placed under, with pedophile rings knowing how we operate against them.

by our entire industrial sector being potentially more open to industrial espionage. the security of our citizens now being more exposed because transnational terrorist organizations, against whom we have put so much effort to combat in recent years, now i know a lot more about how we owe disrupting their activities. you tell me. why has there been such an imbalance in the debate? >> it is interesting, a lot of the -- the majority of the revolution -- revelations have had nothing to do with civil liberties. one former cia director i spoke to -- spoke with, we worked on the russian leak that we discussed, that we had tapped into the server at a chinese university, one of the backbones of the chinese internet, which severely compromised our ability to collect on china.

even "the new york times" revealed that they had used certain technology to tap into al qaeda computers not hooked into the internet. they sought -- they thought that if they step off the grid they would be ok, but we found a way. the times reported that there is no evidence that the technology had been used against al qaeda in the united states. does any of this have to do with civil liberties? any legitimate reason this should be in the public domain under any circumstances? >> i will probably get thrown out for this one, but just as i think there is a smug, self-congratulatory element inside the media, which lives in a limited double, i think the same applies to beltway politicians who are obsessed with the internal mechanics of politics and with, let's face

it, abstract political issues that don't reflect the vast majority of citizens. nor does it interest them. what does matter is the security of those systems, their safety, the safety of the children, the ability to live without interference from foreign agencies and powers that will do them harm. what this is perhaps indicating is a dangerous dislocation between the political and media classes. the rest of the people in the country would much rather listen to a debate about what matters to them and their safety and their families safety band some abstract political issues, which i think they feel are hugely ephemeral. >> can you talk a little bit about why signal intelligence is so important in the war on terror? our laws are actually much stricter when it comes to revealing these forms of intelligence as opposed to others. in world war ii if you expose a double agent in the nazi high command, that person might be

killed, but it would not put the war effort at risk, whereas if we have lost the ultra program, the war would have changed. the signal has always been seen as a higher level, treated at a higher level. we have had our intelligence baird to the world, with enormous damage. why is that exposure so much more damaging than the interrogation program or other things that have been exposed in recent years? >> it is important because of the era in which we live and the environment in which our security services operate. the internet is a wonderful thing. it opens up information to us in a way we have never had before. it opens up information in closed societies. a chance to export values to people who otherwise would never have been able to give it.

a tremendous opportunity in the era in which we lived. itas a dark side. the internet allows the enemies of our state to communicate with one another on a plethora of ways that they can do that. it allows them to organize against us, as we have seen in terrorist attacks before. it opens them up to uncensored violence they can teach them new ways of doing us harm. our security services need to be there. they need to be able to operate in that environment because our populations do here again it would be really nice if we all operated in one information environment and our enemies operated in another, but that is not the case. all the ways in which they transmit information and the ways we are able to intercept it are more vital than ever before. that has been completely blown apart.

there are different estimates as to how much of the signal intelligence has been compromised, but we have to operate on the precautionary principle. we think that any elements have been compromised? you have to close them down. that means that a great deal of the time, effort, and risk that individuals put into getting this information is now lost to us. why? because you have had one altra narcissistic individual who was able to and assisted by a number of others who had deeply anti-western interests to completely compromise us. the debate has not been about whether the industrial enemies of the country now have access to our intellectual property. whether our children were at risk from international child sex slavery.

or whether we are more at risk from al qaeda or other terrorist groups. it has all been his beltway discussion about what the nsa can do in terms of domestic interception of e-mails. i find this very difficult to understand. we need to grasp that this is not a debate about the freedom of the press. this is a debate about our national security, the most fundamental breach of our national security, probably of all time. it seems that the penny has not dropped for many of those who should be the ones who, on behalf of the people of the country, are being outraged. >> the other day and the press there were satellite photos in the front page of the american papers of russian troop movements outside ukraine. we don't have satellite images of terrorists are pairing to attack us. basically, in order to find out

when the terrorists planned to attack, we need them to tell us. there are only three ways to do that. interrogation, infiltration, and interception. interrogation be don't do anymore. that stopped. infiltration is very hard. we are left with, essentially, interception. now that has been incredibly damaged. what is the risk that we face with the damage of another attack happening? >> much greater. it is impossible to quantify, but we know it is much greater. you and i, everyone in this room, anyone who might follow our proceedings, we are much more at risk, as are their families, because of the snowden revelations. so, when they are all congratulating greenwald, the guardian, "the new york times," and whoever else is lauded the pulitzer committee, they might

want to think about the real story here. we are all more susceptible to all of the range of threats that i have already mentioned. i just find it breathtakingly irresponsible. >> cnn had a video last night of an open-air ok the meeting in yemen where hundreds of these terrorists gathered, the number two leader of al qaeda spoke of them, rallied them, completely unafraid of drone strikes. in which he said he rallied them to the cause of attacking america again. the al qaeda threat, we keep hearing from the president that al qaeda is on the run, has been decimated, is nearing defeat. that does not seem like a terrorist movement on the edge of defeat, speaking openly like that area tell me what the al qaeda threat is today. >> they will be looking to see

whether we are able to disrupt them. or at least we will want them to worry that we are able to disrupt them. that we are able to hear them. that we are able to intercept them. ultimately they will be looking to see our political reaction to the snowden revelations. so, has the reaction, in our three democracies, been to say that this is outrageous? that this is treason? that this must be dealt with either full weight of the law? or it has not been a beltway discussion where the media is congratulating itself for being able to tell the public just what a big security risk they have been exposed to. i think they will come to the conclusion that we are self absorbed in a way that puts abstract political ideas ahead of the security of our country.

if we don't put the security of our country is our first priority, what message are we sending to the people who want to do us harm? i think that we need to remember that this is not, as i say, some smug, self-congratulatory political bubble that we live in. what we say is listened to by people outside, enemies as well as friends. i think we need to be fully cognizant of the encouragement that they will now have been given. not only have we told them how we go about listening to them in particular, and how we have gone about disrupting them in the past, we have given them the names of our agents and operatives, putting those people much more at risk, they and their families much more at risk of direct activity and interception. and we have told them that our

political response is to gaze at our naples, rather than be concerned about public security. i think that all of those messages are exactly the wrong messages to send. we should be ashamed of ourselves. >> the editor of the guardian said he testified before the british foreign affairs committee. no names of officials have been leaked by the guardian. >> bazaar from a man who says they have only read 10% of the documents they were given. if you have only read 10% and you are willing to testify to the committee a thousand comments that no agents names have been given, that seems to me to be an awful contradiction, probably in line with i think the full intellectual case that has been made by the guardian -- "the guardian" on this. as well as the responsibility of dealing with the issue. it is a demonstration of their incompetence.

>> snowden, greenwald, they all said that this stuff was encrypted unprotected files, safely hidden away. should we be worried that they are not correct? [laughter] >> is not a question of whether they are encrypted or not. these are classified national documents. you cannot export them outside your jurisdiction without it in treason. even if you take their ridiculous argument at face value, moran to mule was carrying the password -- maranda the mule was carrying the password in his pocket. it is incompetence, arrogance, all added to a perverse anti-western ideology. this is a dangerous mixture.

why are we not more outraged about this? i am outraged, you aren't outraged, we should all be outraged. >> if only 10% has been published, 90% of it is out there and waiting to be shared with journalists, shared with the world, is there any way to put this genie in the bottle? are these secrets coming out whether we like it or not? is there a way to put a stop to these revelations? >> once it is outside our jurisdiction, very probably it is with the chinese and the russians, there is a reason to assume it would be. now we have to accept that there has been phenomenal reduction in our ability to protect ourselves. there has been huge compromise of our security capabilities. we will have to invest in rebuilding them. we will have to look at what, exactly, the portion of our spending we contribute to security.

these tremendous dragons that people rail against constitute 0.3% of total government spending and the equivalent of what he spend on the health services of bridge in every six days. or .7% of american total government spending. i think that puts it in perspective, the we will have to look at it again, how much we required to rebuild. we will have to look again at how we ensure it does not happen in the future. for our protection we depend on the competency of government and the integrity of the individuals involved in the system not to divulge our secrets. i think that we again need to be looking at the government system of contract users and individuals to make sure we are minimizing the risks. you can never eliminate them, but you can minimize the risk of a security breach like this

happening again in the future. >> a lot of these leaks have had the effect of tying the hands of our intelligence service. computers that were not log onto the internet, now they know, now they have other means. that ties their hands. the response from the administration and from congress, rather than doing is you say, to rebuild around this, it is to tie the hands of the intelligence services even more, showing americans but we are not listening to their phone calls and e-mails. we will not collect this data anymore. we won't even require the phone companies to keep it. seems like the response should be to a leak like this that -- let's dramatically put resources into finding ways to affect our intelligence capabilities as opposed to the response of spending a lot of time tying the hands of the intelligence community.

>> our biggest problem is we have a massive hole in the fence. the first thing is to rebuild the hole and then maybe get a new fence. it costs money, time, and effort. if we were investing more of lives and time on the internet, then the argument might have some legitimacy, but that is where our enemies are. our enemies are in the security services, where they need to be. rather than pandering to some of the arguments that have been made in the defense of snowden and his acolytes, i think it is incumbent upon our leaders to tell people the sorts of threats that we still face, to be realistic about the fact that

since 9/11, the threats have grown, they have not diminished. transnational terrorism is more powerful than it was before. and it is why we needed to have the activities of the security services that we do. to point out the oversight we already have in place. that it is governed by law. that no one has been able to show that intelligence has behaved illegally or disproportionately within the ledge -- the oversight they were already subjected to. so, let's try to get this the right way up. >> everyone in this room are decent, law-abiding citizens. we hope. who is tracking our movements on the internet more closely? the nsa and gchq or google? >> that is difficult to say. i noticed how in the debate

people were going crazy about what the nsa were doing, but it did not seem to bother them when they went on to expedia and it somehow magically told you the hotels in the last city you were looking at on a different website, or that what you go shopping they are able to say -- we thought you would like this. people don't seem to regard that as an unwarranted intrusion, but when it comes to security services, giving protection to them and their families, they seem to be outraged by this. am i the only person who finds an odd disconnect in this process? it is all about our sense of proportion and priorities. we depend on security services for our very liberty. what i find deeply perverse about the political debate is it is almost as though there is a

charge against our security services that they are the ones who are threat to liberty, democracy, and freedom, when they are the ones who were there to protect it by ensuring that the enemies of those things are kept in a box. we need to get this debate in proportion, the right way around. it is seriously damaging not only our internal political priorities, distorting the internal political debate, but it is sending entirely the wrong signals about who we are, what our values are, and what our intent is to those who would do us harm. >> if there is another 9/11, another london subway bombing, how will this all look in retrospect? >> i think that that is a really serious question. you could take a very

politically tempting route to say -- well, thank you to the newspapers who have helped mr. snowden. thank you to those who have given awards to those who have helped betray our national secrets. but i think that we need to just stop there. and say, before we get into pointing the finger and the blame culture -- how do we deal with the much more important questions, which are not lyrical ones, but our security ones. how do we repair the damage to the system that has already been done? how do we prevent such damage from occurring in the future? how do we reorient take our political debate so that it is about the things that matter to the people that we represent? and whose security we are supposed to protect? rather than the cozy internal world of beltway politics and journalism?

time for us to get real. >> let's take some questions from the audience. we have one right here. we will bring a microphone to you. >> thank you so much for appearing here today and for the valid points you made. you talked about a hole in the fence. i'm trying to remember, edward snowden before he fled was not a high level employee. his highest level of education was a high school degree. despite that, he had access to this top classified information. what does that tell you about the security of our intelligence services? >> as i said earlier, that is a very legitimate question about the relationship between governments and the contractors it uses to physically carry out some of the national security and the way in which they that

their particular employees. you are right, this was not particularly detailed or specific element picked off the shelf by snowden. this was more like a shoplifter running along the shelf, scooping off as much as he could. however, he did seem to know enough to make sure that what he did pick would do maximum damage to the united states closest allies. not just the united kingdom, but countries like norway and sweden, where the diplomatic relationship would be compromised. so, while from what we know so far, and as we say there are tens of thousands of documents we have not yet seen, we know that he meant to do damage, but specifically how able he was in the time, we have to wait and find out, but it does raise questions about how government goes about the practicality of

its security relationships. these are legitimate questions. these are questions he should be looking into and which, for the oversight elements in our respective countries, should be the areas of focus. >> thanks, dr. fox. i am a retired cia officer. i served for over three decades overseas, here in senior positions -- i would not have known a fraction of the data that edward snowden leaked but i have seen -- i would not have known that it existed or how to get to it, and as i said, i have been in this business a long time. what is your view about -- i will know that you touched on it just now, but could you be more precise about how snowden could have been directly linked to this?

it is inconceivable to me that simply by surfing the internet or by using his own personal resources he could have figured out what was most damaging to our security services and the western security services. >> well, there will be questions to answer. i think they are now beginning to be asked about his motivations, what may have been his earlier, if any, links to any anti-american extra national groupings. let's call them that, for the moment. that is another very legitimate area that needs to be investigated. i think the first thing to look at is exactly the issue you

mentioned, how was this able to happen? how was he able to get access to this information, given the life he operated? are those restrictions sufficiently robust? again, that is a proper area for oversight elements within the constitutional arrangements of this country to be looking at. i would hope that that is the issue of priority. >> thank you, dr. fox. i am the chief political correspondent for news mags. it seems as though we are having similar discussions like this, year after year. in october of this year it will be the 59th anniversary that your foreign secretary said that kim fielding was completely cleared and was not a counterintelligence agent. just four years ago we saw mr.

becks diaz in greece release the names of 2000 people who had secret accounts and were hiding money to avoid taxes. what can finally be done to actually have strict penalties on people who break the law and not make the kind of mistakes that allow us to slip through with this information? is there an answer to this? >> the answer has to be yes. we cannot continue where we are at these relatively low levels, with employees making such great disclosures about information. we have to look at areas of encryption in terms of the information and the level here that employees have in terms of the ability to access it. how we store data. and whether there are simple firewalls in what we do.

all of these issues have to be looked at. there will always be espionage elements with people who want to damage us, for whatever ideological reasons we have, what we can do is interrupt their ability to do damage. that is the area we need to be thinking about in this information age. otherwise this sort of level of disclosure would not have been able to happen. so, that is an area where we need to be considering. i think that we need, in the selection of the employees, we need to be a bit more robust in questioning and assessing them. there is no way of stopping it.

the business of espionage will always be there unless, face it, we are in the same business ourselves when it comes to protecting our own national interests. what we have to ensure is that we are better at it than those who want to do the damage. >> in the back, here. >> thank you. leandra bernstein. i have a two-part question. first of all, you continue to refer to us and we. would you not agree that the united states intelligence establishment and the intelligence establishment of great britain are fundamentally different? particularly regarding the history of the u.s. intelligence establishment versus the much, much longer history of great britain's intelligence establishment? secondly, you also referred to the arrogance of the media.

well, the way that that -- there is an arrogance to the intelligence community as well, intelligence community as well, which is also rather insular. the message that many americans receive is an impassioned, emotional, we are protecting you, how could you possibly criticize us? that is the message, without much substance to it, and with a lot of hypocrisy. for example, in our response to the drug trade, and our response to money laundering and these other issues that the intelligence community, chemical weapons, message -- weapons of mass destruction, issues with which the intelligence community ought to be taking greater responsibility for. >> well, first of all, it is the intelligence community, not the omnipotence community. we cannot expect them e