he effort. e came together and we ccomplish a lot on a short eriod of time. there has been a step functions in terms of the website, it mproves the website very well. lots of demand. 2.5 million people have already been through the site in the last 30 days or so, so that site is in very good shape and health

care is in very good shape. >> there has been some discussion as to the pronunciation of your last name, i don't know if i pronounce it correctly? >> you did just great. > does it right with "science? >> it rhymes with "science. >> great. >> awkward transition. [laughter] >> and when we look at the affordable care act, we have found it the uninsured has dropped by 26%. t the same time, health care costs are going down. health care costs have been increasing for the last 50 years, so now you step back and you say simply, what was the president trying to accomplish

with the affordable care act, it was to do two things: increase coverage and lower costs. e has done both. >> lets talk about congress and stuff that is on the president's agenda. specifically, tax reform and trade deals. you have republicans running the show on both sides of the aisle, do you think there is a real prospect for corporate tax reform that would lower the top rate while closing loopholes? do think there would be a

package that would be acceptable o liberal democrats? is it realistic to think that we will see them through, or will it devolved into parsimonious acrimony? >> we are gearing up for 2015 and legislation, and the president is clear that there are places that we don't agree, democrats, the president, and the republicans, there are places that they don't agree. where is the potential for the agreement and where will we be making progress to improve the economy, move the dial, for middle-class americans? if you look at the intersection of what could potentially get done and what could move the dial in a meaningful way in terms of the economy and the middle class, i think there are three things that come to the top of the list, and you mentioned two of them? ne of them is a good trade agreement or a good set of trade agreements. third is tax reform linked to funding infrastructure. we talked about the advantages of infrastructure, it puts people back to work in well-paying jobs. it steps up our competitiveness. let me go deeper on tax reform.

what makes me optimistic that we can make progress is, if you ook at the president's framework, and the former chairman's framework for tax reform, there is overlap. it starts with 35%. we have the highest statutory rape. it is too high. we can bring it down by getting rid of tax expenditures. we can bring it to the 20's. both plans had that is the first piece. the second piece, right now we have a global tax system, which means that if you are operating in a different country, your tax rate is 35%. that is one system. another system is a territorial rate, where you pay what the tax

rate is in the country where you are operating. the problem with that is, it creates a rate -- a race to the bottom as countries compete to have con -- companies located there. what the president has in his framework is a hybrid system, where you set a minimum rate, and if you are paying more than that in a country, you oh nothing else. if you pay less than that, difference between the minimum rate and the rate you are paying n that country, you oh the u.s. both chairman camp and the president had this tax

proposal. the third lease is, there is lots of money. estimates are up to $2 trillion, that is trapped overseas. if it comes back, it must pay at the 35% rate. that is not good for our economy to have that distortion. both proposals have a one time all fee at a lower rate to bring money back. both proposals fund infrastructure, the long-term eauthorization of interest -- nfrastructure. that overlaps makes me ptimistic.

these are not easy deals. there are differences in levels, the new statutory level, the level in the 20's, what level is the hybrid tax set at? getting rid of specific deductions or loopholes, each one of those has a special interest group behind it. this is not an easy piece of business, but it is important. it could bring more companies back home, and create jobs. the u.s. is the number one place in the world, when you survey global ceos, to invest. we lost that to china for a while. if you interview ceos of manufacturing companies, 54% are looking to bring facilities here. we need to continue to create an environment that encourages that investment, that encourages that in sourcing and getting our corporate tax system up is important. >> is there a scenario in which the president could make a deal, mainly with republicans, and not necessarily bypassed democrats but get republican support on tax reform that democrats are not -- >> anything that needs to get done here needs to be bipartisan. the standard the president has s, is this good for the middle

class? is this good for workers? as part of business tax reform, funding tax structure is good for workers. we have an opportunity to extend he earned income tax credit in a way that is good for working americans. >> does the president expect to get trade promotion authority rom the republican congress, and if he gets that, can he push through foreign trade deals in way that is economically beneficial to corporate america that is also raising wages? x those trade deals are done with trade promotion authority. we assume that trade promotion authority will be an early area of focus for the new congress. at the same time, under mike roman's leadership as the trade representative, there has been ignificant progress in the

ranspacific partnership. it covers 40% of the worlds gdp. this is a -- for fast-growing countries. given our competitive advantages , and the fact that we have been rowing exports and getting a good trade agreement in place, hat will create good jobs. it is also important for strategic reasons. there's an opportunity here to set the rules of engagement on labor, environment, intellectual property. the transpacific partnership gives us an opportunity to do that, and set those standards.

if we do not do it, someone else will. it is important geopolitical he -- geopolitically to get tpp done. it is far along, the president had a meeting on this in china in november. 1500 meetings usdr has done on the hill. the hill is fully engaged. at the end of the negotiation, you are down to the hard issues. what we need to get tpa done, and tpp across the finish line, in these final sets of negotiations. >> let us talk about what seems to be, and will probably arise in the next congress, tensions between progressive democrats and centrist business friendly democrats. it is centered on a couple issues. one is the swaps push out under the government funding bill. the other is the treasury secretary nomination. obviously, senator warren has come out against his nomination. a couple of other democrats have. there are a number of democrats that are incensed about the nomination. ven some republicans are

incensed. i want to know why you think it was a good idea to nominate an investment banker for this particular job at treasury. what he would bring to it. and, does it unnecessarily exacerbate the tensions within the party over whether it is to close to wall street, and should move away from those relationships? >> i have gotten to know antonio over the last year. he is an incredibly talented ndividual with great values. i think he has very relevant experience. when you are putting together a team for a company, you think through a broad set of experience and skills and talents. the same applies in

government. when we have our team at the national economic council, it is the same thing. with the treasury, you need people from different backgrounds, people with academic grounds, people have served in government before, maybe some people who have not served in government before, to bring a new perspective. people with business and financial experience, lawyers. i think antonio is a great member of the treasury team. that team does have an overall set of backgrounds. to bring 20 years plus of wall street and financial experience to the treasury is valuable. i hope he gets a fair hearing. >> is it true that some within the administration -- that treasury now, you don't have that broad experience in financial markets, particularly position when overseas, 18 trillion in u.s. debt, a good percentage of that is publicly held. there is a lack of understanding in financial markets at the treasury right now, high -- a lack of high-level expertise and relationships of people who buy our debt and management of the debt. hat spot where there is a hole in experience. >> i think it is a very talented team with a lot of experience. they have been through a lot. they can handle any situation that might arise. that said, having some buddy with antonio's experience and talent and commitment would be a great addition to any team. >> i want to take a twitter question. somebody asks, when the next bill, will that be a cost of

doing business? where does that drop the line? there is a concern of people who are protective of dodd frank's financial industry decisions. the derivatives shout is the first in what will be a series of changes in the law beneficial to wall street that is potentially damaging to the long-term safety and value of the system. the first inc. in the armor. >> that will not be the case. the president will not allow for dodd frank to be watered own. we have made a lot of progress. there is now 500 billion dollars of additional capital. we are must less reliant on short-term funding. the derivatives market is much more transparent. there are much higher margin requirements. we will continue to push hard on

dodd frank. the president will not allow that to be watered down. >> there are significant dodd frank changes that would water it down? i want to talk about your relationship with business and wall street, there was a lot of criticism in the first term that the obama administration did not have rate relationships of corporate america, and no emissary that could speak to ceos and away that you do. do you view that as a rule -- your role when coming in? what is your schedule like in terms of talking to executives and having dialogues with the private sector? >> i came into my job at the office of management and budget when the charter was to improve government operations and productivity. when you think about the private

sector, year after year, productivity gains of one and a half percent or 2%, that compounds over a few decades to a major improvement. productivity is both cost, meaning cost per unit, and improving service quality. those are correlated. there is not a great measure of roductivity in the sector. the gains are probably about one third of the gains of the private sector. we have the private sector, with these productivity gains, and the federal sector, like this. that creates a productivity gap. our job is to close the gap. we all know it is always incorrect to lead with technology as the answer.

technology has been at the enter of productivity gains, and therefore closing the productivity gap, technology is central to that. with that goal of closing the gap and getting better technology in my first role, i put together a board of advisors coming from the private sector

who are leaders in technology and productivity. that has helped to bring corporate best practices into government to close the productivity gap. in my current role, we are all about, how do we create more well-paying american jobs? in business, and you have a problem, revenue is not doing what you hope will do, the first thing you do is kick your team out the door and say, go talk to customers and suppliers. visit new countries. in many ways, businesspeople on the front lines are customers. they are creating the jobs. it is really important for all of us in government to be very close in touch with business leaders, entrepreneurs, medium-sized and small business leaders, to understand, what are we doing that is working? so we can keep doing it. what are we doing that is getting in the way, and how can we fix that? what are -- opportunities are we missing? i am disciplined in my own scheduled to make sure we are interacting with the folks on the frontline, creating jobs and well-paying jobs for the american middle class. that is our goal. >> how much does that schedule take you to new york? walk us through a typical day or week and the life of jeff zients. >> it is a long day. it starts early and ends later than i would like. the best way to think about it is, meetings, either one-on-one or small groups, a couple weeks ago we were at a business roundtable. 10 to 15% of my time is meeting with ceos and aunt burners

-- entrepreneurs. >> do you think those relationships have improved in the second term doing administration and private industry in a way that you can see? >> we will not always agree. i talked earlier about, there will be areas where we do not agree with republicans, but that does not mean we cannot work together. there will be areas and decisions the president will make on regulation or executive action that not everyone will agree with. i think we are in a good space as far as our communication goes, getting esteem back and explaining policies.

communications and inputs are ood. we have a good working relationship with businesses. >> a few other twitter questions. why hasn't the white house addressed congressional concerns about currency manipulation under tpp? will that get worked on? >> the currency is the view of the treasury department. fixed tell me about -- >> are you a big duke fan? do you go to the games? >> i am a duke fan. i grew up a redskins fan. i find that more difficult these days. lick's tummy about it. >> hopefully there will be better days ahead. >> we have a question here in the front.

>> you spoke about tax reform is one of the issues that could make the dial on the u.s. economy. republicans in congress have suggested that any improvement in the u.s. economy and tax reform should be reflected through dynamic scoring and tax changes. what is your view? >> one place we agree is, business tax reform should be revenue-neutral. therefore, not cost -- have any impact negatively on the federal budget, or we are looking to raise revenue. we are not believers in dynamic scoring. i feel this is not the time to change the rules. let's engage in business tax reform in a revenue neutral

way. let's not change how we score the budget. >> another question, in the ack. >> one of the surprises in this congress was the inability to reauthorize the terrorism insurance act. do you have a thought about where there will be a lapse? do you see changes, and will that spur congress to move quickly or will they drag it out? >> this is terrorism risk insurance. this was meant to be the last piece of business before the senate left town. we were disappointed it was not. our assumption and desire, when congress comes back, is that they make it one of their first pieces of business.

so we do not have a significant gap. >> is there a possibility that, if there is a gap, and the gap is filled by the private sector, there could be a program that was not necessarily needed? or are you convinced it is essential? >> i don't remember the exact count, it was in the 90's in the senate. this is the right thing to do. congress should of been -- done it before they left town. >> one more question. >> i think that vote was 94-3. >> i am not sure if it was a field goal. >> can you speak to upcoming veto politics, where in the last two years, the leverage democrats have is that the numbers they are playing for in the senate are 67, not 60? changes -- that changes everything, even with quicken's aking control.

some very wise former congressional relations staffers from the previous president have told me personally that it is to your advantage to do it early and in a way, just like we do with cuba, make sure people take your threat seriously. few vetoes have been overturned. it is a weapon that most likely will benefit you. can you speak to that? >> is a question about vetoes. the number one priority is to find common ground. where can we compromise as we did on the spending bill young co it's not perfect, but we talk about areas that we don't like, there are areas, potentially in business tax reform and trade and interest -- infrastructure where we can compromise. at the same time, any efforts to water down dodd frank, there was the tax extender bill, which has

$460 billion of permanent extension with very little in it for working-class people. the president made his views clear that that was not something he would support. he said, the fact he would veto it, in a matter of a day or so, that bill was restructured in a way that passed a one-year extension. it was not a $450 billion unpaid permanent pitch to the budget without working-class considerations. i think that is a case study. work -- worked closely with enator warren on that. if something is out of balance, from the president's

perspective, he will continue to express his views, including, if necessary, the threat or veto of legislation that is inconsistent with his values, which are the values of improving life for the middle class and working americans. >> we will see a cavalcade of vetoes? >> we will hopefully see a productive congress. if there are pieces of legislation that come to his desk that are not consistent with his values, he will not be able to sign those. >> it will be interesting for us to cover that. i want to thank the director for a wonderful conversation, and the peter g. peterson foundation for supporting the events. a special thanks to the director of my high school, edmund burke, and my mom. dick taught my first economics

class, i don't if i passed it but i got through. thank you for coming out. have a wonderful holiday. thank you for joining us on the live stream. we will see you next year. [applause]

>> on the next "washington ournal" gordon khang on what's next for north korea's leader. then president and c.e.o. of the association for unmanned vehicle systems international discusses unmanned aircraft and safety regulation. and then the bureau's recent report on the well being of children in the united states. and we'll take your calls and you can join the conversation at facebook and twitter. "washington journal" live at 7:00 a.m. eastern on c-span. >> friday a discussion on the use of envoys in diplomacy and conducting foreign policy missions. we'll join sbors live from the u.s. institute of peace at 9030 .m. eastern on c-span 3.

the is week on q and a hypocracy of liberals. >> it goes back to like i said where the idea for this book came from was the 2012 convention when they were showing this tribute video to him because he had passed away and portraying him as a woman's rights champion when he left a young woman to drown in his car. for nine not gone back hours and tried to save his own behind, she would have probably survived. and you can't do an entire video at a convention claiming to be preaching and fighting the war on women and glorify someone like that while not including that part of his life.

>> sunday night at 8:00 eastern .nd pacific on c-span q and a >> good afternoon, colleagues. i am very happy to see you in high spirits.

as we did last time, i will begin by briefing you on the work done during the year and then i will try to answer your questions. the economic performance. in the first 10 months of this year, the gross domestic product grew by 0.7%, and the final figure may be around 0.6%. my colleagues and i met yesterday to finalize the figures. the trade surplus grew by $13.3 billion to reach $148.4 billion. industrial production picked up some speed after last year's lull.

in the first 10 months of the year, it went up by 1.7%. unemployment is also low: at times, it dropped to below 5%, and now it is around 5%, possibly 5.1%. the agro-industrial complex is developing. i believe that by the end of the year growth there will amount to 3.3%. as you may know, this year we had a record crop of 104 million tons. despite the turbulent situation on the financial market, the federal budget this year will show a surplus.

in other words, revenue will exceed expenses by 1.2 trillion rubles, which is about 1.9% of the gdp. the finance ministry is still working on the final calculations, but the surplus is definite. the main achievement of the year in the social sphere is of course the positive demographics. natural population growth in the first 10 months of the year was 37,100 people. the death rate is going down in this country, while the birth rate is increasing. this is a very good trend and we must make every effort to maintain it. as promised, we continued adjusting the maternity capital.

in 2014 it amounted to 429,408.5 rubles. we have met and exceeded the targets set for this year for salary rates for ten workforce categories. i am sure you know what i am talking about. first of all, these are teachers at schools and institutions providing supplementary education, counselors, university faculty members, medical doctors, paramedics and nurses, and employees of cultural institutions. in 2014, we adjusted pensions to twice by 6.5% on february 1 and by an additional 1.7% on april 1. we gave significant attention this year to enhancing the combat capability and efficiency of the armed forces.

i will not go into detail here. i would only like to mention the social sphere. in 2014, 11,700 defense ministry servicemen received permanent housing and 15,300 received service housing. this is 100% of the year's target figures. now a few words regarding the current situation. i believe we all know that the main issue of concern to this country's citizens is the state of the economy, the national currency and how all this could influence developments in the social sphere. i will try to briefly describe

this situation and say how i expect it to develop. basically, that is where we could end this news conference. [laughter] however, if you have any further questions i will try to answer them. the current situation was obviously provoked primarily by external factors. however, we proceed from the view that we have failed to achieve many of the things that were planned and that needed to be done to diversify the economy over the past 20 years. this was not easy, if at all possible, given the foreign economic situation, which was favorable in the sense that businesses were investing into areas that guaranteed maximum and fast profits.

now, as you may know, the situation has changed under the influence of certain foreign economic factors, primarily the price of energy resources, of oil and consequently of gas as well. i believe the government and the central bank are taking appropriate measures in this situation. we could question the timeliness or the quality of the measures taken by the government and the central bank, but generally, they are acting adequately and moving in the right direction. i hope that yesterday's and today's drop in the foreign currency exchange rate and growth of our national currency, the ruble, will continue. is this possible?

it is. could oil prices continue falling and would this influence our national currency and consequently all the other economic indexes, including inflation? yes, this is possible. what do we intend to do about this? we intend to use the measures we applied, and rather successfully, back in 2008. in this case, we will need to focus on assistance to those people who really need it and on retaining this is something i would like to highlight retaining all our social targets and plans. this primarily concerns pensions and public sector salaries, and so forth. clearly, we would have to adjust our plans in case of any unfavorable developments.

he will have to reduce something jumping toperts say, less than further growth and a favorable solution to the situation is unavoidable. the growth of the global economy will maintain. rate ofking about the growth slowing down but the economy will grow in its and our economy will overcome the current situation. how long will this take? in a worst-case scenario, i believe it would take a couple of years. i repeat after that, growth is inevitable, due to a changing foreign economic situation among other things. a growing world economy will require additional energy resources. however, by that time i have no doubt that we will be able to do a great deal to diversify our economy, because life itself

will force us to do it. there is no other way we could function. therefore, overall, i repeat, we will undoubtedly comply with all our social commitments using the existing reserves. this year they have even grown. i would like to remind you that central bank reserves amount to $419 billion. the central bank does not intend to waste them, which is right. the government reserve, the national wealth fund, the reserve fund have grown this year by about 2.4-2.5 trillion rubles to a total 8.4 trillion rubles.

with these reserves i am certain we can work calmly to resolve our main social issues and to diversify the economy; and i will repeat that inevitably the situation will return to normal. i would like to end my introductory remarks here. as i have said, we could end the whole news conference here, but if you do have any questions, i am ready to answer them. this year i would like to begin with those who have been working with the president throughout the year -- the kremlin press pool. first i would like to give the floor to the dean of the kremlin press pool vyacheslav terekhov, who has been working with mr. putin for many years and who travels to all the remote parts of the world and all the cities and towns of this country. mr. terekhov, please. >> but i've got an interesting

job. there is something i would like to clarify, mr. president. judging by the situation in the country, we are in the midst of a deep currency crisis, one that even central bank employees say they could not have foreseen in their worst nightmares. do you believe that things will get better in two years, as you mentioned, and we will recover from this financial and economic crisis? there has been a lot of criticism during the black monday and tuesday. do you agree with this criticism? >> i said that given the most unfavorable foreign economic situation this could last for about two years. however, it may not last that long and the situation could take a turn for the better sooner. it could improve in the first or second quarter of next year, by the middle of next year, or by its end. nobody can tell.

there are many uncertain factors. therefore, you could call it a crisis or something else, you can decide which word to use. however, i believe i made it quite clear that the central bank and the government are generally taking appropriate measures in this situation. i believe some things could have been done sooner, and this is actually what the expert community are criticizing them for. what does the job involve, in my view? and what are the central bank and the government actually doing? they raised the key interest rate.

this would be linked to the developments connected with the foreign economic situation, and the economy will adjust one way or another. why am i optimistic? the economy is bound to adjust to life and work in conditions of low prices on energy resources. this will happen. the question is how quickly will such adjustments take place. if the prices will remain low, 60 or $40 peran barrel. economy will structure itself. how fast will this happen? this is hard to say. it will happen. i would like to highlight this. this will be a fact of life. what is the central bank doing? they have raised the key interest rate.

what else is it doing? to stabilize the national currency they need to somewhat limit ruble liquidity and give economic entities access to foreign currency liquidity. currency liquidity. the central bank is doing that. the central bank must decide for themselves how to act. give away our reserves and not waste them in the market. we must give the loan resources to people. theof the tools is so-called repo is a well-known instrument here. they can be offered for a day, a week, 28 days, almost a month, or for a year. this is returnable money which gives an opportunity to the

economic entities the opportunity to make use of the foreign currency. i hear the criticism towards the central bank. not forgetent must about its responsibility. you must work with the same exporters which have good currency benefits. the chairman of the government met the leaders of our largest somenies and there are results that have come from this meeting of course. many of them need to play their loans. about theirthink companies because a company as a citizen always thinks about how to save something for the worst time, etc.. it is a economic behavior or

not. the companies are doing this. we can see that they're still positive results for that. and we need to take some other measures. i am talking about fighting inflation which is the job of the central bank but there are some things which we have mentioned publicly, i mentioned when we met with the government which which minas by the government. example, the fuel prices, the gasoline prices, the food prices, this has to be tackled with by the government. he must work with better manually. you should meet the producers, the market participants, the trade network. the oil companies.

they have monopolized our markets. all of those should be joined and collected. this should not intrude with the inner competence of the central bank. this was timely. on the whole, we mustn't forget their policy is adequate. it is not only the central bank which is responsible for the economic situation in the country. another from the fallout. first of all, i have something to say. i think a lot of us have been waiting for your press conference now and everyone was thinking what was the mood of putin.

thank you for your optimism. we hope that everything will be as you said. since 2008, we have been speaking about going away from the oil addiction and restructure our economy to make it more efficient. the current development show that we are still on the oil and we don't know how long we will remain there. will we be able to use this crisis for to our advantage, in order to restructure our economy? understand this would not be done quickly. in your address to the federal assembly, you named, to the

a number of benefits and you understand that's the main ,anger in russia is bureaucracy and the stalling of the implementation of the correct decisions including the decisions of the president. are you sure now that your decisions that you expressed in your speech will be implemented this time and this optimism will be confirmed with real steps. >> we can only show ourselves by having the right economic policy and having reserves. , thiss a good insurance

would make us feel confident. thinking about the red tape installing the reforms. that is what happened. there must be some from the european union. if you asked him about the red tape and bureaucracy, in our country nothingness compared to the european union. the main problem is that the very beginning when i said come and in the press conference to be over, it does not have to be a joke. the main problem is not stalling the decisions. when macroeconomic situations pushes come it involves they developed sector of the country, then no matter what the government does in order to , taxing and regulating the non-commodity process, this is still a very difficult

process because we don't have enough budget resources to implement those reforms. to improven trying the business climate and to facilitate the development of the situation. the process is a difficult one. it is getting especially difficult when you get more profit invested. about 80% of the requested the government are not related to investing in highly technological areas. apply for a chance to produce energy resources. when the economic conditions get pushes us into other areas. this is optimistic. to find somel have

difficulties. also to address some social issues and to fulfill our social obligations that are contained in my decree. still, i suppose you can't benefit from the situation and i diversify our economy and create beneficial conditions. i do hope that today's economic situation will help us. could you please make your questions shorter so that we can mr. putin more? >> at the beginning of 2012, and one of your pre-election articles that then transformed , youthe president's decree characterized the current .ituation

russia is focusing. what do you think is happening to the country at the moment? what do you think the country is doing? do you think it is time to just relax finally? >> what you have to do is to work. it has not changed in this regard. the current conditions are actually pushing us to further continue the reforms. by seeing you and your colleagues raised the same issue. external conditions only make us wake more. future ofed for the our economy is to create favorable conditions. we have to provide for the freedom of entrepreneurship.

we also have to go into the property rights. we had to the enforcement agency -- everyone. we also have to work on our industrial sector and work on the regions of the federation. >> we have been doing that for quite a time. we also provided for tax holidays. inidays for three years relation to the public and private. they are not criticized for any violations. what they have to do is to go on

concentrating. this in the 25th anniversary of the fall of the berlin wall. russia was closed. this is an anniversary year. building a new wall. it was not a complete wall. it is mutual suspicion.

do you think that we can do anything to restore the dialogue? >> what we are witnessing at the moment the ms. building a new it is not what we are witnessing at the moment. you are an expert in relations with germany. after the berlin wall fell, didn't they tell us they would be a major expression. isn't that a wall? it is a virtual wall. part of our system near our borders. no one thought this is the problem. involvement did not stop.

they decided that they were and all of the other countries were vassals. they did not stop building the wall spite of all of our attempts and gestures. you wanted to act together in europe. i hope that we will stick to a top position, especially in situations like this. best ways to start building those walls. i would like to give the floor

to our colleague from the ukraine. like to ask two short questions. whatirst question is about you organized in the east of our country. this was intended against the russian speaking population. the russian military is fighting there. how many of them did you send there? how many russian militants did you send? how many people died? you, the commander in chief, what can you say to the families of those who died? the president is hiding in the territory of the russian federation. prisontime, he put in yulia tymoshenko. ,she served her term.

moment, the number one is surfing his time in russian prison. ukrainian warre prisons are serving their terms in russia. when will they be relist? >> why don't we start with your second question. our opposition on the issue is transparent. there was a journalist who died during a professional duty in the ukraine.

let me emphasize that the journalists who died here did not take part in any military action. they were it is the duty of all state agencies, including the military ones, to protect their lives and health and to give them an opportunity to do their professional duty which is to provide objective and full information, at least as they see it. it is a fact that has been recognized in the civilized world. they have been killed. according to our law enforcement agencies, savchenko called in artillery fire via radio. if it is reliably established during the pretrial investigation and the subsequent trial that she was not involved and is not guilty, she will be released immediately.

but if they prove that she was indeed involved in the journalists' murder, a russian court will issue a proper ruling, as i see it, and she will serve her sentence in accordance with the verdict. however, no one has the right to hold anyone guilty of a crime on account. includes the presumption of innocence. so we'll see how the investigation proceeds. as for the other servicemen you have mentioned, we don't consider them prisoners of war. they are in detainment in russia, and they are being investigated on suspicion of involvement in terrorist activity. now to the first question, about responsibility.

in russia, like in any other presidential republic, it is the president who is responsible for everything. and responsibility for military personnel rests with the commander-in-chief. let me remind you that in russia this is one and the same person. all those who are following fulfilling their duty by voluntarily taking part in hostilities, including in east ukraine, are not mercenaries, since they are not paid for what they do. public opinion holds that what is now happening in eastern ukraine is actually a punitive operation, but it is

conducted by the kiev authorities and not the other way around. the self-defense fighters of the south were not the ones who sent troops to kiev. the kiev authorities amassed their military forces in the southeast of ukraine, and are using multiple rocket launchers, artillery and fighter jets. what is the problem here and how it can be solved? i'll try to answer this question as well. the problem is that after the government coup -- and no matter how others call it and what is being said in this respect, a government coup was carried out in kiev by military means -- of the country did not agree with these developments. instead of at least trying to engage in dialogue with them, they started by sending law enforcers, the police force, but when that didn't work out, they sent in the army, and since that didn't work out either, they are now trying to settle the issue

by using other forceful methods, the economic blockade. i believe that this path has absolutely no future whatsoever and is detrimental to ukraine's statehood and its people. we hope that by engaging in dialogue and we are ready to assume the role of intermediaries in this respect we will succeed in establishing a direct, political dialogue, and by employing such methods and political instruments we will reach a settlement and restore a single political space. >> mr. president, are the current economic developments the price we have to pay for crimea? maybe the time has come to acknowledge it? >> no, this is not the price we have to pay for crimea. this is actually the price we have to pay for our

natural will to preserve ourselves as a nation, as a civilization, as a state. when answering a question from your ntv colleague, and as i've said during my address to the federal assembly, after the fall of the berlin wall and the breakup of the soviet union, russia opened itself to our partners. what did we see? a direct and support of terrorism in north caucasus. is that what partners usually do? and everyone knows it. no matter what we do, we always run into objections and opposition. let me remind you about the preparations for the 2014 olympics, our inspiration and enthusiasm to organize a festive event not only for russian sports fans, but for sports fans

all over the world. unprecedented and clearly orchestrated attempts were made to discredit our efforts to organize and host the olympics. who needs to do so and for what reason? you know, at the valdai club i gave an example of our most recognizable symbol. it is a bear protecting his forrest. if we continue the analogy, sometimes i think that maybe it would be best if our bear just sat still. but start picking berries and eating honey. maybe then he will be left

alone. but no, he won't be! as soon as he's chained they will tear out his teeth and claws. i am referring to the power of nuclear deterrence. we have heard it even from high-level officials that it is unfair that the whole of siberia with its immense resources belongs to russia in its entirety. why exactly is it unfair? to snatch texas from mexico but it is unfair that we are working on our own land no, we have to share. and then, when all the teeth and claws are torn out, the bear will be of no use at all. perhaps they'll stuff it and that's all.

protecting our independence, our sovereignty and our right to exist. if we believe that one of the current problems including in the economy as a result of the sanctions is crucial, and it is so because out of all the problems the sanctions take up about 25% to 30%. but we must decide whether we want to keep going and fight, change our economy for the go through all this or we want our skin to hang on the wall. this is the choice we need to make and it has nothing to do with crimea. >> the russia channel is responsible for our broadcasting. good afternoon.

the crimea issue is more or less clear. the only question perhaps is how much we will have to eventually invest in its development after the difficult ukrainian past. the most urgent question for me is about eastern ukraine, which is now calling itself novorossiya. how do you see the future of that part of ukraine? do you believe in the success of the minsk agreements? do you think they will help reconciliation? and how are we going to further help donbass? will it be humanitarian aid, as it is now, or something else? >> i think i answered a part of your question in my response to your ukrainian colleague.

we believe that the crisis will be resolved sooner or later. the sooner the better, of course. this is the first point. second, it should be addressed and settled by political means, and not through pressure, no matter what type of pressure, whether an economic blockade or the use of armed force. and we will help the people, as we are doing now. as you may know, a tenth humanitarian convoy has been sent. after all, we should proceed from the fundamental principles of international law and from people's right to decide their fate on their own. it's not just a casual phrase, when i said that peace should be restored and problems should be resolved by political means. it's hard to say at this point what it would look like, but i think we should strive for this.

the problem is, however, that both sides need to strive for this. people living in ukraine's southeast should be respected. economic ties should be restored. it is a fact that much of ukraine's power industry burns donbass coal. we were asked to influence ukraine's southeast, donbass, to make the miners agree to supply coal. but they are not buying it. because they've closed all the banks and are unable to make payments. our colleagues told me yesterday we are ready to pay and have transferred a prepayment. they allegedly wired the money to the miners' bank cards, but the cards are not working, and this is how it is with each issue.

there is no other way but a peaceful settlement. as far as the minsk agreements are concerned, it's a very important part of this, and we want them to be complied with the minsk meeting came from me and from petro poroshenko. i have no doubt that he is striving for this. but he is not the only one over there. we have been hearing statements from other officials, who advocate basically a war to the end. that all of this is likely to lead to a continental crisis. we hear many statements. president poroshenko is oriented towards

settlement. but concrete actions and steps are needed. our representatives in minsk signed a memorandum in september and there were protocols to it that defined the disengagement line. representatives of donetsk didn't sign those protocols. that's the problem. they said at the very start, we can't. when we tried to insist, i'll be frank with you about this, since the public needs to know these things, they told us that they can't leave these villages. their families live there, and they can't risk their children, wives and sisters being killed or raped.

however, the ukrainian officials did not withdraw their troops from the areas that they were supposed to leave, such as the donetsk airport, either. they're staying there. are you aware of the latest developments? the militia allowed them to rotate their troops at the airport. they took them to a bathhouse and sent them food. but this is a positive development. everyone is insisting on exchanging prisoners of war. i believe that they should all be exchanged unconditionally. but life is more complicated than that.

these lists became include people who have been detained not in connection with the hostilities in southeastern ukraine, but somewhere in kherson or odessa. these lists must be checked. yesterday, they agreed to exchange 30 people. representatives of the self-defense forces went to the exchange location, and a representative of the kiev authorities said we are not going to proceed with the exchange. but these are details. anyway, it would be a positive move, including in terms of implementing the minsk agreements, which is an videoconference today or

tomorrow. the next step should be made at a meeting in minsk. there's another important thing. it's essential for the kiev authorities to keep their end of the bargain. there was an agreement on adopting an amnesty law. it is nowhere to be seen. they keep telling us that a law on special status was passed, but it couldn't be implemented, because the law could come into force and actually become effective only after the other law had been adopted about the disengagement line. it has not been adopted so far. if ukraine wants to restore peace, tranquility and its territorial integrity, the people who live in certain regions of the country must be

respected and a straight, open, and honest political dialogue must be maintained with them. i hope that in the end everyone will go down that path. >> thank you. this year, it became clear that energy diplomacy has become a key factor in geopolitics. how justified is russia's turning to the east and the gas contracts it has signed with china and turkey? have all the pitfalls of these projects been considered? many still doubt that the chinese contract will be profitable, while the potential turkish stream will leave russia dependent on turkey.

do you have anything to say here? >> no, i don't. it would be impossible to argue. if you read american analysts, they also write about the united states' turn towards the east. is this true? the asia-pacific region shows faster growth than the rest of the world. new opportunities open up. as for energy, the demand for resources is racing in leaps and bounds in china, india, as well as in japan and south korea. everything is developing faster there than in other places. so should we turn down our chance? no, we are working on were planned long ago, even before the most recent problems occurred in the global or russian economy. we are simply implementing our long-time plans.

about the chinese contract it is not a loss-making project. both sides on both sides, i must stress. china offered some benefits as well. i will not go into details right now. the chinese government simply decided to provide some support to the project participants. we, in turn, agreed to do the same. so the project definitely became profitable. we have agreed on a pricing formula, which is not much different from the one applied to our european contracts, except for the specific regional market coefficients.

in addition, it will help russia, which will receive and accumulate gigantic resources at the project's initial stage, to begin connecting our far eastern regions to the gas distribution grids, not just to export gas through the pipeline. this will allow us to make the next a very important step. we will be able to link together the western and eastern gas pipeline systems and promptly channel resources back and forth when needed, depending on the international market. without it, we would never be able to connect eastern siberia and the far east to the gas distribution system. not to mention that it is a huge construction site that will revive russia's far east and the entire region. about turkey. the turkish economy is also

growing and requires additional energy resources as much as the we built the so-called blue stream pipeline many years ago, and now our turkish partners are considering increasing the supplies to the turkish market. should we refuse? we have reached all the key agreements with them, which cover the pricing formula, supply schedule and other aspects. we more or less understand their requirements, and we will certainly sell them what we have and what they need. we will do this. will a so-called european hub be built on the border of turkey and greece? this is not for us to decide. the decision largely depends on our european partners. if they want stable, guaranteed and absolutely transparent

energy supply from russia, which they badly need, without any transit risks? then we'll start working, and the pipeline would reach macedonia via greece, go on to serbia and to baumgarter in austria. if they don't want this, we won't do it. the thing is that there is no cheaper and more reliable supplier than russia, and there won't be any in the near future. >> mr. president, i'd like to go back to the situation on the currency market, which changes from one day to another and is a great concern for millions of russians. many experts, including you, mr. president, have said the current situation could be blamed also on currency profiteers.

can you give us those names? are they russians or foreigners? why can't they be stopped? are they too strong? or are we too weak? a second question on the same subject, if i may. do the central bank and the government plan to peg or devalue the ruble? >> this is what our ukrainian partners did, quite unsuccessfully. they would just buy it back the next day, as it happened in kiev and as it happens in other countries.

the next step in this case should be to set a limit on the purchase of foreign currency on the domestic market. we won't go this far, and so the central bank and the government are not planning, quite correctly as far as i see it, to limit our exporters in this field. this doesn't mean, though, that the government should not act through its representatives on company boards. our largest energy companies. they are partly state-owned, which means that we can influence their policies, but without issuing any directives or restrictions. as for the so-called profiteers, it is not a crime to play on the currency market. foreigners or various funds, which are present on the russian market and have been operating quite actively there. or they can be russian companies. as i said at the beginning of this meeting, this is an accepted practice in a market economy.

they always appear when there is a chance to make some money. in the market by creating favorable conditions, by pushing, for example, as was done in the beginning of this process, like, in this particular case, the central bank of russia was pushed to enter the market and start selling gold and foreign currency reserves in the hope of intervening and supporting the national currency. the central bank stopped, and it was the right thing to do. perhaps it would have been better if it had been done earlier and in a tougher way. then perhaps it wouldn't have been necessary to increase the rate to 17%. that is a different matter. i told you who they are. two days ago i had a friendly telephone conversation with some of them and i asked,

"why are you holding back?" "our loan payments are due soon," was the reply. can you enter the market?" he took a minute and replied, "well, i guess we have $3 billion." they have $3 billion in reserves. and this is just one company. so if each company has $3 billion, in total it is not $30 but $300 billion. we can't force them. stability of their companies. to this end, the government must work very closely with them and ensure, along with the central bank, foreign currency and ruble liquidity whenever it is

necessary. >> good afternoon, mr. president. the number of beds in hospitals in several regions, and mainly in moscow, is decreasing. the number of staff is decreasing. what do you think about that? and will a similar experiment be carried out in other regions? people are concerned that as a result of the reform they will not be provided with the right to medical aid that is guaranteed by the constitution. >> you know, you are talking about a major issue in our life at present, one of the fundamental issues i would say. education and healthcare must

always be within clear sight of the state and the regional governments. naturally, we must see, understand and react precisely to what is happening in a particular professional community. any changes that occur must be introduced in cooperation with representatives of the medical community in this particular case. if the moscow government skipped this stage for some reason, it is a mistake that must be corrected. first place when working on issues like healthcare and education, we should be guided by people who use the healthcare

and education services. millions of people are waiting for the healthcare industry to improve. our citizens, consumers of healthcare services are those, whom we must think about first of all. what are people saying? they are not pleased with the healthcare. we must analyze what's going on and what should be done to improve the situation. i won't assess what the moscow authorities have done now. they acted within their competence. we're saying that our healthcare is expensive but not very efficient. in many cases beds are used not for treating patients, but for improving their health, we must make our medical aid high-tech. for four or five days a

person receives intensive therapy in a hospital and then completes his treatment at an outpatient clinic. moreover, the city of moscow believes that the bed capacity is excessive by about 30%. we keep it the way it is we will have to pay for land, electricity, heating and the like. these are inefficient costs. it's better to spend the funds on improving the quality of medical care, equipping hospitals and outpatient clinics with modern technology, and on training medical personnel. i'm now referring, as i see it, to the reform of healthcare as a whole rather than actions of the moscow authorities.

but i think what they have done recently is correct on the whole. they launched a dialogue with the medical community. they made a decision on additional compensation for doctors. 500,000 rubles to medical specialists. 300,000 to the nursing staff and 200,000 to auxiliary medical personnel. moreover, they are drafting a program for retraining specialists. from two or three months to two years. the city needs to decide who will work and in what

position but this cannot be done without consulting the medical community. moscow will act carefully, very without consulting the medical carefully, without hurting anyone. the main point is that they should not forget the most important principle of not only a doctor but of all transformations in healthcare do no harm. >> good afternoon, mr. putin. speaking to the federal assembly you used the expression "national traitors." you didn't specify whom you meant but thanks to you the term has again become part of the political vocabulary. your supporters have

labeled those who oppose the authorities the fifth column. to whom were you referring when talking about national traitors and the fifth column, and where, is the line that separates the opposition from the fifth column? >> i do not feel any responsibility whatsoever in this respect. everything i do is aimed at consolidating russian society, not dividing it. if you think it did happen, i believe you. maybe you have an even more acute feel for it than i do. in my public statements i have to be more cautious. we can't mask the truth indefinitely and sometimes it is our duty to call the things by their names. your question isn't easy, since we're walking a very fine line here. it would probably be very

challenging to come up with an definition of where the opposition ends and the fifth column begins. this very year, we celebrated the anniversary of mikhail lermontov, the genius of russian poetry. we all remember his lines. we remember what he wrote about the borodino battle. "by moscow then we die as have our brethren died before." but he also wrote -- "farewell, farewell, unwashed russia, and you, blue uniforms of gendarmes, and you, obedient to them folks." was he an opposition activist? of course he was. as you may be aware, and probably a lot of you know, when

he wrote "the death of a poet" on the death of pushkin, one of his relatives saw the text and asked lermontov to soften it a bit. lermontov was so infuriated, that he actually made it even more bitter and edgy. was definitely opposing the authorities, but i think he was also a patriot. this is very fine line. he was an officer, and a very brave and courageous one, who wasn't afraid to get into the line of fire in the country's interests. by the way, in the last movie by nikita mikhalkov, such officers, who actually brought these efforts to their logical end,

the revolution, were later killed by revolutionaries. after all, the line that separates opposition activists from the fifth column is hard to see from the outside. opposition activists may be very harsh in their criticism, but at the end of the day they are defending the interests of the motherland. the fifth column is those who serve the interests of other countries, and who are only tools for others' political goals.

>> our minister of defense -- at the moment, it is about $50 billion in total. the pentagon's budget is 10 times higher. i think the congress recently had a new defense contract. do you think this aggressive policy? >> does it sound logical or reasonable to you? is it us who move our military forces to the borders? is it us who move our military structures? does anyone listen to us? is anyone engaged in the dialogue with us? no. what we hear is just mind your business. every country has the right to

share security. why are we not allowed to do that? we are supposed to have tried too. i spoke about the treaty. it was one of the cornerstones of the security system. who withdrew from the anti-ballistic missile treaty? the united states did so, and they deployed their strategic systems in europe. they are trying to say that it is not an aggressive policy? whether we want to maintain relationship based on rights -- yes. we want to build relations based on equal rights.

we have been maintaining negotiations on wto for many years. we believe that the agreements reached were supposed to be solid. i'm not speaking about who is guilty and who is not. i believe we are right. our western partners are wrong. but we joined the wto, and they are in violation of the u.n. charter. there have been sanctions introduced against russia in an absolutely illegitimate and illegal way. the only thing we want is to promote relations based on equal rights. we would like to work together. we want to work together. transnational organized crime.

including the ebola virus. we will work together if our partners wants to cooperate with us. >> hello, mr. president. i am from kazakhstan. i have a question related to the legislation process. since january 1, the union of belarus and our media are going to join. given that developments in our economy, are there reasons to be concerned? could you comment on your prediction and vision of the common market?

>> kazakhstan and russia both produce oil. it is not related through integration. i am just saying that kazakhstan is facing the unfavorable economic situation at the moment. speaking about all the economic difficulties, the global economy is growing. and there is growing demands for energy resources. speaking about your proposal, it is as follows. it is to work together.

we can take a single economic space for free movement of human resources. of course it is easier to do that together. it has increased 50 fold, and it is very impressive. of course we are going to further benefit from integration. >> given that we have produced 104 billion barrels, the policy is very great. my question is related to the development of our agricultural sector. it is impossible without addressing the human resources issue.

one of his workers recently resigned. then the farmer was trying to find a worker to replace him but no one wanted to work on a farm. no one is going to do the work on the land, on the soil, people are not willing to work on the soil. some believe that it could affect our food security. >> of course i share your concerns. it is very hard to work in the current conditions but at the same time we cannot share the optimism of those who believe

that quitting the domestic market for internal producers will increase opportunities. of course we have to think about addressing the issues. of course we have to think about vocational training and educational opportunities. with very good vocational education in agricultural areas, it will be beneficial for this area of the russian economy.

as well, just yesterday we discussed the decision to support the agriculture. i hope that our agriculture workers will appreciate it and benefit from it. what is very important to do now is to make sure that they sell their grain, we have to make sure that they reach, that they are not all received by intermediaries. we have to provide educational training. speaking about the prices of industrial goods -- it is not a good thing for consumers but it is a good chance for producers and i hope they will benefit from it. >> i was already thinking you

didn't want to answer. mr. president, what are the prospects of the russian -georgia relationship? does russia believe that we are going to raise those relationships to a new level?

do they require more active

the grave situation after the dissolution, georgia declared its independence and said they are going to stay with russia. it was the same punitive operation. that is not forgotten. everyone accuses us of all the things, but that was not our work and we are going to help settle the matters. after our warnings were ignored, hostilities started and we acknowledged independence of those republics. frankly speaking, it is very difficult. as for the meeting, in georgia, we have very little contact. there are internal power struggles. as for liberalizing the shipments of georgian goods to russia, we did that. the response to the promise of georgia not to stop russia from entering the wto despite our political differences, that was a very welcome gesture from the georgian authorities, and we answer that with being ready to follow in that direction, and

if georgian leaders we will be very happy to see georgia and moscow. >> maybe our colleagues -- please, you have the floor. >> good afternoon, mr. president. we had the dialogues, and you were there and i am very grateful for that. of course there are sanctions, and not very friendly relations of different countries towards russia, but we see that there have been slavic peoples that joined us. we always considered them friendly. in that regard, i would like to hear your opinion on the prospects of the slavic peoples, czech republic,

bulgaria, people who could form a friendly alliance so that they could help us in international affairs just like it is done with english-speaking countries. another question i have -- he has never violated the constitution and he will never let the constitution be violated in the territory of the republic. i was silent when you blatantly -- you were not stopped from asking the question. i have the following question. when innocent people, people that work on the roads, teachers, journalists, when

their lives are put in danger when comrades die, went roads are inspected, his children were left as orphans and he had a pregnant wife, and he knows exactly when certain families were in contact with the militants. not militants, terrorists. there are no more militants in chechnya. they were asked to get back those people, but they called those people in the woods -- they were asked about their comfort and that is according to helping terrorists. those people should be held responsible. do we believe, in regard of terrorists,

if we should use the means that we have so as not to endanger the lives of hundreds and thousands. if we had not taken measures we would have a half a million victims. >> i understand the grief of people, of the families of people who died. i am sure that he will never leave those people alone. as for helping terrorists, of course all of the accomplices should be brought to justice but of course within the law. what really was the case, that will be clear during the investigation. the fact that we have combated terrorism in all dimensions

including helping the terrorists within the law. the slavic countries, they are in a difficult economic situation. they are under pressure. you see that pressure is of course due to the economic situation and with sanctions and we are being under pressure but those minor countries are of course more susceptible. and the serenity is going through hard times. but i know within the people, the will is not political but cultural and spiritual unity it will prevail.

it cannot be eradicated. >> mr. president, a year ago, you, in this hall, announced that iran is our neighbor. it is one of our priority partners. i am quoting you. and we are going to develop relationships with those countries. and this is our choice, you said. a year has passed. turnover has decreased. and no contract that could lead to an agreement emerged.

iran is not in the eurasian community, iran does not participate in projects, the large oil contract has not been implemented. and i am building on the fact that the this year is less than half a percent of the turnover with other countries that russia has, so there is a paradox. no one in russia is responsible for this state of relations. maybe you should think about maybe ordering somebody to be a representative of the government responsible for the turnover with iran and the development of economic relationships with it.

a lot depends on the actions of the ambassador. maybe you should analyze the duties. an ambassador does not contribute to economic traded by 5%, then you might criticize them. if it is next year, you might change an ambassador. i believe that the direction of iran and russia would give a lot. last year you said he would visit iran. that has not happened at the in agreement and that has not happened either and i do not understand it. have there been any changes to be strategy? >> first, as far as ambassadors

are concerned, of course constant improvement of relationships is their duties but that is not directly within his duties. according to your recommendations, we will not have ambassadors to be ambassadors. as to whether diplomatic missions work in a country, that is determined by the minister of foreign affairs. after your question, we will analyze the efficiency of our embassy in iran. on the whole, we are satisfied with their work. as far as the turnover, it has flown do -- slowed down. we are taking steps to improve

it and improve the structure of it in the volumes of it. -- and that the volumes of it. it is not just dependendant on us, it depends on the global economy. this is the objective process, because iran is an oil and gas producing and extracting country and their economy is largely linked to the world's oil sector. now we are witnessing the falling down of prices, oil prices. there are many discussions on that project, why is that happening, is there a conspiracy to punish iran and the economy of russia and venezuela, etc. it might be or might be not. maybe it is just the struggle of

the traditional producers of raw materials with the shale oil, for example. maybe you just hold the price and squeeze the shale oil out of the market and then increase the price. go to the interests of the u.s. oil producers coincide, of course, because the u.s. administration is very calm about the investment done. countries would stop investing in extraction and against the backdrop, it would lift up so much it would be bad for developed countries. most people understand that at our chinese friend