they become the lab rats for moving the other way. >> i think just the barriers -- everyone has access to the same technology. the barriers to getting something in consumers hands and consumers using it i lower than getting into an and provides -- then getting into an enterprise. i think consumers are end-users -- or end-users, i went things are going. i think we will continue to see consumer led initially, and then-- water grid is interesting. it takes a while to see applications. i think consumer leads. the brand is consumer led.

>> next question. >> good morning. larry, this is for you. in a macro environment with information, what companies are technologies do we need to conduit this information. what repositories can we develop? >> i think we have most of the core technology in place. the cloud, high-speed networks. we now talk about 4g, but we did a conference late last year on 5g coming in the next decade. even crazier than the last. who is going to lead that? you can make the case economically that it could be the providers, it could be the network engineers, like the verizon.

or it could be information experts at google and so on. all of those are plausible. probably some combination thereof. >> i think what ends up happening in this world of exploding opportunity and data and innovation, we go through eras of chaos and then we try to organize it. and then we go to chaos and organize it again. and you can see that if you look at the web. google tried to organize it and then it explodes. then we do other things to curate it. you have this constant cycle of explosions of information and cure ration that you try to -- duration that you try to create order. that order might look like insight and curation. but look at that companies that are trying to apply order to chaos current and you also talk

about it in your book. >> who is going to create the network effect that drives the most value. i think that is why there has been most focus on platform. >> they are trying to create order to the chaos. next question. >> what new business models use the emerging? for example, ge doesn't sell jet engines anymore. they're basically renting the rotation of the rotors. or if you take over and the driverless car --uber and i driverless car, you take away the whole industry. assets become services. what these the emerging -- what do you see a emerging as new businesses emerge? question number two is, aren't

you guys afraid of what the ultimate solution could be? if you watch these tv shows like person of interest --" person of interest,", where a master computer directs you to do things. are you worried that at some juncture we are just -- we are not the director, we're just a cog in a machine? >> to the first question, what is the real business model. [laughter] >> i think you did a piece of it. capital becomes more productive. one of the things we see over a long. of time -- era of time is that we replace labor with capital.

leisure, entertainment hotels -- crews that can go around and clean the hotel. they will nknoknock, you will see infrared hotel beds and bells. this is taking capital that was being underutilized and employing it in a more useful and productive way. anywhere we have a labor pool

that isn't using a lot of capital -- it will be disrupted in the next couple of years. >> i do not have any science or empirical evidence for this -- i just remain optimistic about this. the way i think about it is there are two possible outcomes in star trek terms. the united federation of planets , everybody cooperates and has the ability to achieve personal enlightenment. or you have where everybody is nobody -- the giant collective. they are two different futures to come from the same set of technology. i hope it is more like the federation.

>> i think you can look at the negatives and all of the fear, but it is insulting. half of the planet is not connected, there are so many big-ticket problems that will be salt over the -- that will be solved over the next few years i think you mentioned the changing of the automotive space. the number of people, and your book, who get on the road. being driven down to to talk about a time when 30,000 people -- these are really big ticket

items for technology to solve. >> i look at the way we toggle between the real world in the digital world. we used to view those as very separate identities. today, the mobile phone is the bridge. over time, as technology becomes a bit more pervasive, but more seamless with our analog world it becomes less intrusive. it becomes a much more natural -- i look at the way we deal with computers. go back in time and look at punch barkscards. over time, we have moved to them out of the conversation. last question? >> i was at ces last week and

saw hundreds of great ideas. what struck me was the early adopters of the gadgets -- 20 years ago, we had a vcr that was blinking 12:00 all the time. the consumer has a real problem with going from earlier adoption to mass-market. they do not want to buy -- with the proliferation of all these devices. >> we are moving into an environment where we have fragmented innovation. the products that are widely owned, 80 or 90% of households. only 64% of households actually

own their home. i think we are going to start to move into niche markets, where the saturation is 30%. so we find, i think we start with well-defined and discrete and you start to overtime call those together. you make this transition. look at the car, we are getting there by solving these well-defined problems. falling asleep while you're driving, approaching a vehicle where you have cruise control engaged -- all of a sudden, each one of those starts to look like an autonomous experience. put them together, you end up with the full driverless car experience. we need to solve these really

well-defined problems, mainly applicable to individuals -- 20% of households. we are not going to see mass-market adoption of smart yoga mats, we saw propane tanks that you could connect to the internet to see how full they were. that is probably not applicable to everyone. we start to move into the smaller niche markets. >> because the cost of experimentation is so low in the market, 99 of the experiments fail. when consumers find the right one, we talked in our book about how it went from zero to a bunch

of users in a matter of days. essentially, it is not broadcast like it used to be. social media based, this is the one that works. this is the right smartphone this is the right app. particularly for electronics, as a group, figure out the winner. there is very much a winner take all four commodities. essentially, a couple of experiment succeed -- the rest fail. you have the investors, whoever they are, happy. >> thank you, very much. [applause] >> coming up on c-span, a discussion on policy at harvard.

and former defense secretary william cohen. later, remarks from former florida governor jeb bush. economist and technology and business leaders will host a discussion. our coverage begins on c-span 3. >> the memories come flooding back for people who, until

today, had lost a big part of their childhood. some buried in the memories, and with it, the history of this camp. now, more than 60 years later. in crystal city, texas. >> the government comes to the father's and says, we have a gift for you. we will reunite you, if you will agree to go voluntarily. they discovered what the real secret of the camp was. if you had agreed to voluntarily repatriate, to enter japan, if the government decided you needed to be repatriated. the truth of the matter is that the crystal city camp was

humanely administered. the department of state used as a primary prisoner exchange as an extension of roosevelt's exchange. >> now, a conversation on internet policy. we will hear from facebook, google yahoo!, trip advisor -- posted by harvard. >> welcome back. welcome to the folks who joined us. i am on the faculty here. i am teaching my first class

this semester as soon as we wrap this up. i thought that the title of this part of the program is meant to solve your next big star of idea. tup idea. ways that it can encourage new entries in the space. there was a great comment from alex jones. alex had mentioned to things. one that the san francisco courts judgment in throwing the guilt case out.

>> and their related. thank you. the leading financial news organization in china has been charged by the chinese government with extorting money from prospective advertisers clients, in order to prevent the publishing of certain stories. the idea is that they were extorting money and cooking the report. that is illegal. this is a funky kind of gray area for american journalism. it is true that news organizations all over the country have long been seeking advertisers, from people they cover. you may not extort, you may not threaten.

the issue for the web, it seems to me, is that there are laws that put limits on what news organizations can do in terms of their own reports. even in a first amendment environment. the penalty for journalism, for publishing something erroneous is liable. defamation, damage to people -- the courts have said you can make a claim about. as i understand the web about's and all the information they have gathered and put on their sites, the argument is being made constantly. they have first amendment rights to do whatever they want. in the case of the up thing, it was a matter of them saying we are not going to do this. but that is something that,

basically, they reserve the right -- there is no, as far as i know, a law that is going to put any constraints on it. however, if you are looking at yelp and other entities that are publishing after a fashion -- even though they call it abrogating, they are going to be find themselves in the realm of libel if they claim first amendment protection. i think this whole question really is where is the control of this vast amount of data --is it going to be considered a first amendment or a different kind of legal thing. they will resist any constraints aside from voluntary ones. i do not know if they will stick.

two questions there i will open up to the room. one, the role of the first amendment around speech in regulation. they do operate, essentially, in the public spear. here. the second you added at the end there, i'm going to interrupt for a minute. i have the not so envious task of following the same rules. introduce yourself briefly at the beginning. >> i write about technology for the "boston globe."

i do not know if the problem could get that far. since i work in media, i'm aware of this all the time. there is a classic way of expressing bias that is not lying to the people. is about what you decide to cover and what you decide not to cover. just based on whether or not you do not show it. for example, google or any number of online entity, should they disadvantage any certain group --to show more of that perspective. they could advantage a company by showing a better ranking to one company. that is the kind of thing that is much more concerning. >> i take your point, but the fact is, the power of these

websites is consolidated as they grow. unlike your paper, you can go to the herald. you can go to the " new york times." you are going to be impacted financially by where you lie in the advertising-dripven, yelp has a right to put you anywhere. that is not the way boston globe does business. there is no alternative to being on yelp's list. this is an area that they would absolutely claim first amendment rights, and they would be given

it. it is also true that those less are now, clearly capable of doing significant financial damage. if you are going to claim first amendment rights, there are other considerations. >> one, if yelp is not being responsive to the users, that it is no longer useful. second, there are alternatives -- you have trip advisor. you will do other searches, go on facebook and ask your friends. hey, i'm going to be in boston, what should i go to? if any site is not being responsive to the users, or productive in that kind of way people are going to use other sites. there are lots of them. >> is the question of whether

someone is publishing something else. whether it doesn't damage quantified and proven. if yelp and others are claiming first amendment protections then that goes with the territory. i wonder how that is going to sort itself out. >> joel kaplan from facebook. since we were referenced, i'm going to disregard the two point role -- i will be quick. i grew up in boston, i love the "boston globe." in the internet era, the most significant impact has been the democratization of the individual area did a notion that in the town i grew up in

it was a good thing you had the herald. on the internet, everybody has a voice. they can have it on facebook yahoo!, any number of distribution mechanisms. facebook, at least, it's out of rhythds algorithm --if we fail in that, they will stop using their newsfeed. the second point i want to make in this discussion of startups this issue of liability protection for internet companies. that are just showing user generated content is probably the single most important protection that led to the proliferation of successful startups -- and the internet as we know it today in section 230.

i think you cannot overstate how important that intermediary liability is. not just the companies around this table, but others. if they are subject to lawsuits for everything there millions of users put on the site, they are not going to create it. >> let us shift our discussion to the sharing economy. we are joined with christmassy from massy from lyft. >> i discovered that uber was illegal after taking it. it seems like it is happening on

a basis of municipality from municipality. taking different approaches from a regulatory perspective. i was wondering about that, should we have a broader, more uniform way of regulating the questions that come of the sharing economy. is there some advantage to a peaceful, more visible approach? this is an issue almost every company is facing around this table in some way shape or form. i am very interested in your thoughts, as well. move the mic little closer. >> the german court ruled that uber did not have the rights to

operate. we are appealing that. they have gone up 519%. the free market, people vote with their wallets. they are showing their interested in having us operate in their country. we are hopeful therefore a good resolution. as far as one solution individualized solutions, it depends on what the solution is. right? we have good relationships with the cities, the state of colorado passed peer to peer ridesharing regulation. it is a good regulation that is a good thing. other states, it is tougher to get in there. it is just going to depend on the jurisdiction -- one catchall solution doesn't work any better

than 50 different ones. my colleagues that go all over the company -- all over the country, a lot of times local government, this is something they have traditionally dealt with. as far as a transportation market goes. offering the kind of service, we have to work with those governments to try to come up with a workable solution. >> mali fromolly from airbnb. from the most part, sharing economy comes from dealing with regulations that has nothing to do with the internet. airbnb, the internet simply

enables >> land use in our case is regulated at the lowell level, and there is really no way around that. land use laws have very good reasons to exist. they protect safety and many other things that we as a platform rely on. thank goodness erin andrews hosts live in homes that are safe for them to live in and safe for their guests. it makes it difficult for us to advocate on behalf of the host, but we have to work cooperatively with these cities to figure it out. hopefully we can come up with solutions that might be applicable to thousands of cities around the world.

>> chris matthew with lift. i agree with that whole-heartedly. i think what we are finding is as we have these patchwork of regulations across the country much like uber, what we are dealing with are laws that were written far above the way we operate was contemplated, in some cases dating back to the 1800. what we provide is the opportunity to move into a new generation of innovation through their regulatory structure. we come in and work clab tatishvili with cities, mayors states governors' offices. to some degree i imagine congressional members will get involved, but right now it is a localized issue. what i see and what lyft has seen is a desire to move towards what the next level of innovation regulation really

looks like. we can tom to a city of boston and say we want to provide a positive pier to peer pe -- movement. >> so offering some of the data collected for the purpose of public policy. >> that is where we are ultimately going to head. we have to rt partner with a lot of these cities. we are already doing it and finding ways to work collaboratively with these cities. that is the next step. >> very briefly it is very encouraging to hear these sharing economy companies around the talking talking about the collaboration with the local government. i work for the city of boston, and we are trying to craft appropriate regulations that both address the public policy needs we have as well as ensure

these new services can deliver benefits to citizens. the challenge that i think we face is often that there are -- we have to look at these problems not only from a question of here is a new service that is maybe being used by a small part of the population that has certain self-regulating characteristics to it. when you think about a regulatory regime, that is going to apply not only to what exists today, but to what comes after it. what individual services have evolved and what new services are created in the space. there needs to be an open-mindedness on the part of local governments but a measure of caution in saying what works for transportation company x may turn ought to be not sufficiently protective of the public sbsts for transportation company y that starts up next week. that is the balance we have

that we have found that most of the companies in the space have been open to working with us at the local level. it is a dialogue the city of boston is open to happening. >> adam canor. i work at brigade. prior to that i worked at facebook. particularly these examples of collaboration is encouraging. in my experience having worked with the federal and larger state governments -- to take a step back, when start up companies were there, federal ages were first interested in using facebook a collaboration was not the word. we want to use your free service, and these are the things you have to do for us to use your free service. you have to do all these arbitrary things for the government to use your free service. i would go to a meeting and 10

government lawyers would sit down and say here are the 32 things you have to change in order for us to use your free service. why won't you embrace the spirit of working with the government in openness. so we come back and say ok is there any world in which you guys might think about changing your policies or talking about modernization? >> no, we are not going to change anything on our end. what is nice about hearing about this local model -- and many people in government are doing good work but there needs to be a responsiveness and modernizing things as well to allow new technologies to agencies and others to use it. that is another part of the conversation. if we want the benefits of these new technologies, we need to make sure the internal rules are willing to be considered to modernize them. it is an unfair burden that we were able to take on because at

the time we were facebook and we had the ability. but a lot of other one-two person start-ups that government may benefit from using don't have that opportunity and that is a tremendous loss for everyone. >> todd cohen from even. i appreciate what my colleagues from uber, erin andrews and lyft and their properly respectful attitude for government services and the need to collaborate at the local level, and i whole-heartedly endorse them doing that. but with the reality there are very entrenched economic interests that have every desire to put start-ups like that out of business. they work actively and have political power and engage in many ways the worst type of

regulatory models. we want to have a level playing field is the classic example. therefore, we should have these unnecessary burdens placed on new entrants that have nothing to do with the underline service. i am pleased to see the german people are responding. it is actually what people want. i would make sure that as many as these companies i advocate you try to get in early and inoculate yourself and try to make sure you find the regulators that are not only captive but that understand what is going on. what happens in the end is it is an example of farrah ternity hazing the we got hazed when we joined the fraternity. you're going to get hazed when you join. i appreciate that everyone has the right attitude of we want to collaborate and work with governments. but let's be clear.

there are people that want to stop these services and will spend effort and political power to harm these businesses. >> that is actually a great point in the con text -- in the context if we are talking about startups. every company in the room is pretty young compared with some of the more established industries you are frequently dealing with on policy and regulation. it seems there are two challenges. one is a challenge of entrenched industries trying to protect their turf from challenges frequently from unexpected quarters. another might just be a generational gap among decision-makers. on monday when i was in germany i was meeting with a group of very senior german officials who had no idea what uber was. they wanted me to show it to them on my phone.

this goes a little bit to adam's comment about the challenges faced in these institutions. i just wonder what are the right strategies? what have some of the experiences been around dealing with government institutions that are -- that may have a generational gap in understanding some of these issues and experiencing them coupled with some organizations or companies reich comcast who has been in washington, d.c. for decades, and what kind of environment that creates for shaping public policy? >> i am with google. i todd's comments were right

on. if you are only playing what i would consider the inside game with policy-makers there, is a good chance that newer companies and newer industries are going to lose simply on the base of the older industries having been there longer. not just the taxicab industry or the hotel industry, but the content industry, the telecommunications firms. these are companies, many of whom are regulated. they have been players before and policy makers for a long time. i do think that one of the tools that is effective here and has been effective is showing policy makers when they are out of tune with consumers. pipa-sopa battle that was referenced earlier is the quintessential example here. that was proceeding as an inside game debate. it wasn't until it became an outside game with consumers weighing in that policy makers put the brakes on what they

were doing. unfortunately, i think that tactic is probably going to have to be used. i think in the wake of that one of the things we have observed is policy makers at least in the u.s. are extremely cautious about legislation becoming the next thing. they don't want their bills to get that. they don't want to be the recipient of thousands of phone calls saying they are on the wrong side of something. so i do think there are going to need to be moments as todd referenced where newer companies confront policy makers with saying it is us who is on the side of consumers. one of the scariest things a policy maker can encounter is that they are not on the side of their consume ertz. they often sandwich sides very quickly to avoid that situation. most long-serving policy makers are not going to last very long

if they are completely there a sustained in way out of touch with what their voters want. >> i am trying to find it in my e-mail, but it not working. i seem to remember getting an e-mail from uber maybe a year and a half or two years ago about the challenges they were having in d.c. i thought that was remarkable. i don't want to say it didn't happen. i seem to remember this happening. that they were actually going to their commerce saying this is your community, and you need to be engaged on this. it was a terrific decision in hiring david. that is a tactic he is very familiar with. >> when you say that is a tactic he is familiar with, what tactic? >> grassroots organizing, using technology to play an outside game. when the companies engage in debate and realize an inside strategy is not sufficient and play the outside game, it is mind boggling to me the amount

of power that these companies have when they decide something is important to their corporate interests. they can call it user list and they can leverage the list for their interest. it is a political dynamic. >> i want to add something quickly. i agree whole-heartedly with the degrees roots advocacy. they don't necessarily have enough people to do the grassroots advocacy on their behalf when it is an idea. in addition to advocacy, education is really also important. erin andrews has invested a lot -- gerald abbrederis has invested a lot.

so that they can make informed decisions. >> i wanted to jump on that point about the power that companies have to mobilize their user bases. it is more a way of keeping companies issues about what issues they take on. our people aren't going to follow us unless they understand how the positions we are taking have a direct impact on them. at etsy we have been doing a ton around net neutrality because our users care about it a lot. they are concerned about slear internet speeds are going to affect their businesses.

it makes us feel confident that when we mobilize our users to contact congress about this, that they have our back and that we are not diverging from the interests of our community. that is probably true for all the companies around the table. >> thank you. the first sort of premise that is important to recognize is there is really no advertising model for democracy. there is not a way to sustain public purpose in a civic space with an advertising model. it has never been that way. we have to figure out what is a sustain able displan. this is a big conversation that is starting to happen. the other thing is our institutions have to be technologyally self-determining. we have to give them capacity. one way is by giving places like congress staff.

why don't we have a code for america for the legislative branch where we re-invent land grant knowledge for the public interest? what members of congress very often don't have is basic situational awareness. the less they have this technological competence, the more complexionity migrates to the military services. this is a classic explanation for what has happened at the n.s.a. when you do the neck cal competence and the rewards of public service to the defense department a lot of responsibilities that are too hard for the civilians are just going to go there. they have had the computer scientists and the situational learn tools for decades now. there are probably a couple of hundred million terry fellows in congress. if you need foreign policy

expertise, you ask for a military fellow. congress is working at 60% of 1979 levels of staff. meanwhile, almost 50% of who us staff has been moved into the district. so unless we create some kind of a high quality decision support system for our legislative branch in the states, it is not going to appear, and it is going to continue to look sort of like this proprietary information cartel, which is really what congress looks like. i say this with a great deal of love for this institution. i am obsessed with it. but it really needs this kind of institutional empathy right now. so glad you are hear because the executive branch has been the focus of attention, but it is running into a wall right now when it comes to legislative branch capacity for

even understanding these problems. when you are working on the hill, you ask the person who is sitting next to you. it could be nuclear non-proliferation, and it could be technical i.t. questions. we have to somehow provide them people. >> nick, do you want to jump in there? >> i think there is tremendous potential to bring entrepreneurs and innovators into government. that is what we are doing with the presidential innovation program and the u.s. digital service. that is important as we think about modernizing our government digital services. the reason that is rely van to internet entrepreneurs and start-ups is the government can be a platform. we are opening up data as fuel for private sector innovation. that is one of many things that the presidential innovation people work on. >> one of the challenges for the public policy space in the

internet age is what you see in the private sector is through start-ups, the disruption of old business models that can now be reinvented because of new technology. well, in government, particularly the federal government and particularly an institution like congress, you are not going to see that level of disruption at the same pace. it manifests itself weather things like 7% approval rates. they persist through a pelosi majority and a represent majority. it is a process rejection. that is an extremely important issue for our country. i think the united kingdom has done exciting work on how to modernize legislative activity. the broader challenge for the technology community is at a certain point -- it is like how can you regulate uber if you

live your existence in a motorcade? [laughter] at a certain point we need our institutions and executive leaders to be connected with the reality of life in our society. we have been through it before with the rise of television, with the rise of radio and other things, and i think we will get there. if i can pivot slightly to the issue of regulations. i think one of the things that is remarkable about the technology industry as a whole and through its existence in the last several decades it is unique in that it typically protects disruption of itself in a way that most other industries don't do. as technology begins to impact more and more sectors in our society, you see this regulatory response not as a way of serving public interest necessarily but as a weapon to protect the status quo. i think the technology industry needs to keep the public on its

side as sort of a primary objective. because without that, it will never be able to tweet those static interests. you think about things like self-driving cars, which is a net good for society on a variety of levels. how is that going to impact the insurance industry, the transportation industry, the trucking industry and all the other industries? it is a massive regulatory fight and it is just one of dozens of fights we see. i don't see the technology industry as being able to succeed in those fights unless they protect the interests of their users so they can leverage that in a modern grassroots organizing if you will. >> i would just build on that and say i think that there is tremendous opportunity for engaged partnership between the technology industry, the start-up community and government itself.

chris alluded to in talking about the ways a service like lyft could share transportation data and perhaps the city improve overall delivery service. we have shared some things in boston. during this session i got a notice that the broken glass i errored on the sidewalk by my house using our city anpp had been cleaned up by our public works department a few hours after i reported it. it is about recognizing that people expect a standard that is defined in large part by what the technology industry has created. so i would ask somebody in government to people who work in the technology industry is reach out to us and look for ways to partner with us. we have service delivery not only obligations, but we have a desire to up our game and to be able to match the kind of expectations that people have. instead of thinking about it as

how do we avoid this regulation or get an opening to do this kind of service, if we think about where the museum benefit lies. there are a lot of opportunities for everybody to come out of this delivering a great product for their commerce, whether they be citizens or paying commerce on the other end of a product. >> i have more of a question than statement. you can expect me to ask questions because i don't know anything. you hear lately a lot of people talking about sort of a libertarian moment in politics. i don't know if it is true or not. but i wanted to ask if maybe the rise of internet start-ups wouldn't drive that? if you look at uber and lyft and the sudden pressure it puts on government to reduce regulation the way they rig late transportation services. i think are we going to have to do this with every new internet innovation down the line? and won't that lead to a general push to increasingly

de-regulate sectors of the economy to make it easier for small companies to start up, to make it easier for people to use the internet? are we going to start seeing political pressure to do that, or is it going to be an ad hoc case by case basis? a new company comes along and we will have to rethink that one sector. >> to answer your question is what you may see is consumer appetite and a willingness to have more sexarnlteation. i think was are seeing -- to have more experimentation. the bumping up of old regulations. we are supportive of those with new technology, being able to aggregate and brian talks about getting 500,000 people to sign up. that power to be able to do

that has not existed up to now. that is an amazing opportunity for an entrepreneur to find a market demand that is pent-up by the pop has. as that proliferates and people start doing it and adopting it, i think we have seen in many instances whether it is the companies we have named with stub hub and ticket regulations, all these things over the past 10 years, a little bit of a hey, easy on the tiller let's see how this plays out, is one of the things that local government can do. i do think there is a tremendous opportunity in the 35,000 amundson pallets that airbnb is in, to test, learn. you have an amazing lab around the world to be able to see what works and doesn't work. that can actually be applied also to the ferguson and what you are talking about -- to the

federal government and was are talking about with congress. i think how boston implements technology and uses it, and taking the best from what boston can do, or new york city, or chicago. and then seeing what works. i don't know if it is going to happen on a top-down approach, but i think sort of a bottoms up, test and learn and pick the best of the best is something we could reasonably look forward to. >> i just wanted to come back to the questions that matt raised around disruptive technologies and in particular think about technological unemployment. let's talk about the economic context in which all of this is happening. partly because i think the sharing economy companies particularly but tech companies in general as well claim a lot of public good effects. if we think about the massive

employment-destroying capabilities of these technologies -- and that is the flip side of efficiency, is that they are really -- you have to own that part of disruptive as well. and then ask the question what about technological unemployment. something that came up yesterday in the evening discussion, and it really wasn't addressed well, i don't think. it is true that new jobs are created. but if you think about the whole picture of economic analysis, and you look at the last -- the previous two centuries and how technological unemployment got absorbed, it was in two ways. number one was growth. so you had very rapidly growing economies. and number two, massive reductions in hours of work. we went from average hours of work being 3,000 hours of work in the late 19th century down to under 2,000. so neither of those -- in the

united states, neither of those conditions is operative at the moment. we have slow growth. we are a mature economy. oecd just came out with a new report about all of the member economies. we are facing a future of low g.d.p. growth rates over the next couple of decades and we have big barriers to the reduction of hours in the united states. i think we can't just assume that we are going to be able to absorb. if this sector wants to be able to not only sort of promote gains in the narrow, but also have the whole thing work out in a way that does yield public good, we have got to be thinking about those largers labor market policies. >> hop in there because i think some of this is the way we want

to look at a market in action. i think if you are looking at something finite and we have macked out what we are capable of doing as an economy or marketplace, then this is a bigger problem. it is not just a concern but it is a problem. the pie is so much bigger than we realize. our chicago team reported back last year in 2015, they added 25,000 rides to the economy. not that they took 25,000 from cabs, but on top of what was existing the year before, there were 25,000 more rides with uber and lyft on the market. the potential is there and the demand for all these services. the demand has always been out there for the stuff. but now we have the technology to actually meet that demand. it changes the entire economic makeup. we are on the cusp of an economic sea change here in the way our economy works.

there was a time when there was a horse and buggy on the road next to a car, and people got around both ways. the world changing in that way and technology is allowing that change to happen. these are valid concerns, but as that growth potential is there, the solution is there, too. if you stifle that out of fear, then you are literally stuck and never moving forward. >> so we do have janet yell en -- yelen trying to encourage economists and employers that increased wages are actually a good sign for economics growth. i also think about the point made earlier about using your commerce mobilizing them to help effect policy change. but that can work both ways, too. that can lead to the people who use platforms for income and employment to effectively

unionize maybe in a non-traditional sense to demand increased wages or increased benefits. >> i was going to make a point from about three point back. >> i was going to briefly say -- i shouldn't but i couldn't resist. there was a story a couple of years ago -- in fact, there have been lots of stories about the minimum wage and people who are stuck in these jobs and the growing protests they are launching. you find yourself cheering and sympathizing. but the very technologies we are sitting around talking about are going to make it virtually impossible for these protests to pay off in the long rough. you already have fast food restaurants moving to kiosks and tablets and other things. so that is going to remain stagnant for a large segment of the american population.

these are part of the problem and nobody has quite figured out how to work around that yet. i don't think there is an easy answer at all. >> but they are the answer. that is the thing. those technologies are the answer. that was the point i was trying to make. i was in san francisco and i took a ride to where i was going. the woman who picked me up, her husband came home from work, and she would go out during the rush hour two hours while he was home with the kids. she wasn't working full time as an uber driver. she had the lyft app on and turned it off. but it is creating opportunity. it is giving you an opportunity to supplement your lifestyle and income in a way more convenient for you. these are the opportunities here. this isn't something holding people back. >> an opportunity to work three jobs instead of two.

>> but it is offering a certain amount of flexion inlt. it may mean that the work force has to change and people's expectation of the work force changes. you may have a small business you are working to make things or sell things while you are producing articles that run on the yahoo developer network. it may also allow you to be a stay at home mom with your kids and work out your house. there are certainly problems with the transition period from sort of everyone goes to work from 9:00 to 5:00 and has one job and stays there for 15 years to this sort of an economy, but i do think -- i agree with brian that there are -- as there are certainly concerns and problems with it, there are also a lot of opportunities. i don't think we know yet where all those opportunities are going to a i rise. i think generally the technology and platforms we all

use create opportunities. that is also the case in our lobbying and policy setting. one of the things that has been really fun about working for yahoo is that there is an opportunity to educate lawmakers about policy issues they have never thought of, about technologies they have never used. yes, you are oftentimes fighting an entrenched industry, but you are also not set into any one policy answer. you may have two or three different policy answers that work with the industry. you get to sit down and have that conversation with law make erlings. you talk to them about your concerns and how to make it work. there isn't necessarily one right answer but there is a huge opportunity to do a lot. part of that is bringing the users along. that is what you are starting to see in terms of effective advocacy by this industry. >> i think we can't argue this

on the basis of anecdote. there is little doubt that these technologies have enormous labor displacing impacts. that is why people like them. that is the power of them. that is all the efficiency that is being claimed. it is not to say that uber won't create more rides, but i think there are really two big questions. number one is what is the aggregate rate of growth? that is absolutely essential for how much of that displaced labor can be ememployed. we can't forget that every april additional percentage point of g.d.p. growth puts more greenhouse gases into the atmosphere. we are coming close to the point where we are going to have those kinds of caps. that is a whole other new kind of constraint on this thinking about what is going on at the level of the nation as a whole and the globe as a whole.

and second is what is happening to hours of work. if you don't have reductions in hours of work you can't absorb technological unemployment. you look throughout history. it is not to say that we shouldn't have the new technologies or that we should somehow stop this. it is to say we have to think about their introduction in a bigger framework than just the local regulations around taxis. it is also about the income distribution and labor market policy, climate policy and all of those things. we need to look at the big picture to make sure where the gains are going. one ticket internet company may not want to get engaged in that, but the community as a whole has to precisely because of all those backlash issues. >> david, matthew.

>> so i do think -- i am david simon. i am with sales force, whose business is providing soft wear as a service. i do think there a valid point that when you have rapid technology changes and point displacement, i think one of the places where this needs to be re-evaluated very hard is in the educational front. this country has very much ig -- ignored stem education science, technology extension and math. we have tried to take advantage of the technology. we've seen a little bit of it. but in terms of stem education for people being displaced so they can get new jobs in the economy that are valuable, sending people out to community college, it is a relatively

inexpensive way to educate somebody with the internet. i think all these need to be taken advantage of. it goes back to an earlier part of the problem which is policy makers tend to get stuck in a certain way of thinking, whatever their perspective is, and you have this real dichotomy of the twenty-somethings who are people doing a lot of the work for the policy makers. but the policy decision-maker is somebody who looks like me and typically very entrenched with a certain way of doing things because that is the way then doing things for two generations. >> in terms of policy makers, i think the single biggest thing that policy makers don't get is the difference in a brand new niche compared to a niche three

or four years old. these spaces lock in pretty quickly. that is especially doublely or tripley true in sharing economy niches, which are essentially market makers. we have 300 years experience that market meac niches become very quickly natural monopolies. that should make us even more concerned about this sort of redistribution of market power. if i want to drive a car for a living very soon -- how many ride-sharing companies are going to survive? i would bet a month's salary not three. probably not even two. so i think this very quickly becomes an issue where the economic cones transition becomes self-sustaining where it is very difficult for individuals to bargain on their own with these entrenched

firms. >> well, even if tow or three ride sharing companies exist, there may be dozens of limo companies and taxi companies that they have replaced. there is still a consolidation in the market, so to speak. >> and by the time you are down to two as we have seen for example with traditional auction houses, it is very easy for them to collude. you don't even have to do an illegal conspiracy to make sure you are offering the same sorts of deals to people who want to sell their arpt work. -- artwork. >> i wanted to jump on the point about educating the work force. it is true that these things are disrupting the labor market and creating new opportunities. 42% sold on etsy for the first

time. but i think it is more than the stem education which is important, but field fewer jobs than building out some of the work-around entrepreneurship and prepping folks for this new and changing economy, which is not the result of technology alone. the economy has been changing a lock time towards more flexible work self-employment and those type of things. how do we prepare workers for that new world of entrepreneurialship? it doesn't fool just to the tech companies, but the industry prodly. >> i have to say something about the stem comment. right down the street here at harvard law, you have someone who came out with a book basically saying it doesn't exist, that america has plenty of stem educated workers, that

this panic about the lack of stem workers is a traditional cycle that has happened. most famously in the 50's after sputnik. if you look at wage rates among people who have scientific or technical training, it doesn't seem to be a problem because wages have been relatively stagnant even for them. so the thought that we can educate our way out is highly questionable. we need to look at that, too. >> what is the difference between the stem education and some of the concerns in the tech industry about immigration. we are in a moment where the president is considering executive action on immigration if congress doesn't act, although that seems to be politically charged and may not happen. and we have had players pushing

for movement on the immigration front. >> a scam to keep wages low? >> joel? >> sure. >> my c.e.o., mark zuckerberg at facebook has taken an active role for pushing for comprehensive immigration reform over the last few years. there are many components of comprehensive immigration reform that rement to stem. they have to do with what i think most of the companies who operate in this space do perceive as a shortfall of the types of highly skilled trained, engineers and computer scientists who can produce at the level that is required to remain globally competitive. i think most of the companies around here would be interested in reading the work of the

professor, but as a day-to-day matter, they know that they are not able to find from the u.s. trained work force of u.s. born people a sufficient number of the skilled engineers they need to keep these companies growing, innovating and competing. so that is where immigration reform on the high skill side comes in. at facebook we probably get about 50% a year of the h1b, temporary visas for high skilled workers. we have given job offers to many who were educated in u.s. universities but foreign-born. now as a global company, if we can't bring those people to the united states to work with our

engineers in california, we are probably still going to give them a job. we are just going to put it some place else. that is not good for the united states and that is not good for our economy and building and maintaining the centers for excellence that we want to maintain. just taking facebook as an example, but i think it is true for a lot of the companies around the table we we have close to 80% of our work force in the united states and 85% of the users outside of the united states. that is the structure we want to maintain. we want u.s.-based companies growing jobs here and serving the world. i think the prospects for comprehensive immigration reform are looking dim i would say in the current congress. the president is considering taking some executive action. we are hopeful that to the extent he does that, he tries

to address all aspects of the problem, the undocumented problem and the shortage of high skilled workers. >> this whole issue of immigration and what facebook has been up to is -- makes the case for the tech community to get more invested in sort of long-term policy conversations. we have a humanitarian disaster on the border right now with a bunch of 7-year-old he is coming in. it is part of a much bigger systemic problem where issues like governs and failure are issues. it is getting wrapped up that. d.h.s. and the military are calling this under the headline of resilience. you are going to see more definitions of resilience, and mass population movements are a part of it. unless this community takes on this whole civic

problem-solving of complex sorting and filtering of the challenges we are facing as a global society, i would argue, i think it is going toby hard to get out -- going to be hard to get out of this box. it can't just be h-1-cb for your company. as someone who has been working in it for the last 14 years, the most noticeable thing about the forward .us one of the first thing it did was take out add buys against some of the members of con you will need as allies later on with the immigration issue. that is relationship based. d.c. is kind of like a city that is a junior high. there are the jocks, the homecoming queens, the nerds. there is just a moment right now. there is such a need for people to intentionally bring these

problem-solving minded folks together and just figure out new ways to do this. it is not going to look like these old models of lobbying. i will tell you what that looks like inside congress. it is tendency to use campaign technology for governing. what it is doing is making governing look like campaigning. people who look at congress can see this can't be petition sites. the correspondence management system of congress is sentiment, not substance. so unless we figure out a way to privilege certain kinds of information that match institutional functions, like what is the subcommittee institutionally response for, that is what it needs for authentic high reputation sources. my dream is we are going to move toward a future where this community that has largely commercial interest in this space reserves or helps create

some new rules. i feel like every time it is these process rules that are just missing, and they really don't exist right now for civic social norms. >> adam? >> just one response to that she was saying. i think in -- and adam is a great person to talk about this because he add facebook six or seven years ago started pioneering the effort to educate congress on how to use our platform to communicate with constituents and hear back in new ways. one thing i want to point out, though is i think all of these observations to education and change institutions make sense. we also need to operate in the world in which we live today. that is a big difference silicone valley's approach to the world and washington's

approach to the world. silicon valley, they see systems, and they want to go around them, change them or disrupt them. unfortunately, at least for for you, congress still operates as a democrat ichaboddy with -- democratic body. as you think about how to get policy changes and this is what ford was struggling with and made a valiant effort in trying to get comprehensive immigration reform done -- you still have to change the minds of the people at home before their members of congress are going to be responsive to them. so the strategy you mentioned of the adam, that was one ad as part of a broader effort and strategy to figure out how to

give members of congress the fortitude to take what may be a popular vote in the valley but maybe a difficult vote in their constituency. we are going to have to change it and try to convince people in some old-fashioned ways although maybe using some new tools. >> just to talk a little bit that, which seem -- i mean no disrespect confused slightly. first i used to work in congress. i love the institution. i think many of the things you suggested are good things. it also has to be an institution that wants to save itself. that is not always evident in congress. yeah, their software doesn't work. they don't break contracts. they cut staff. then don't always want to make the heart choices. it is incumbent on us to provide help, backup you can't save somebody who doesn't want to be saved.

when you talk about comprehensive solutions, when i look around the table and i see for example around the table, many of them have deep connections in washington. when you playbook at some of these issues, you say we need to be more involved in immigration, governance and other things. if that becomes a thing they have to do now as part of a broader thing, i think they are willing to play a role as many companies are. but that is the role of government. to put the burden on us while simultaneously trying to save institutions we think are broken, there has to be a rule. there are people in government championshippers and local government doing this. we have to save an institution that may not want saving and help me get better.

it feels like a confusing argument. >> i am definitely confused. you bring up a great point. >> i was just going to make the point that one of the notice villegases that a number of these companies represent is reputational networks. there is a great example of that happening in the executive branch. there was a recent article about how 10,000 federal executive branch are using get hub. it is sharing code but also a way to share ideas and have dialogue. so you have 10,000 federal employees from folks in the white house all the way down into regulatory agencies who are collaborating. you have these reputational mechanisms that are helping them to sort that input from the public and from other federal agencies and so forth. on how we make policy yes a lot does happen from congress but a lot happens from

regulatory agencies. what i'm excited to see is the modernization of regulatory agencies in the coming decade. just as one small example the platforms that power a lot of the regulatory agencies are developing an open read/write a.p.i. it is not just that you have to go to the website of that regulatory agency to put a comment in but advocacy platforms, mcgrattan roots everyone on their on platforms can contribute. we can use technology to sort, and weigh and all of those things in the rule-making process, which is a big part of kind of how we govern. >> i would like to add on the topic of immigration reform, that is certainly an area that affects our entire economy and probably every industry in this country. when you look at interpret companies as a whole they are all relatively new companies, young in their development and certainly new to politics and policy. i would argue that when it comes to immigration reform,

our companies have done more and certainly more than their share, to push this debate forward and have it be a constructive conversation and move the ball down the court to get reform done. it is not done in one congress or one year. it has been many years, maybe since the 80's since there has been immigration reform. they are not just picking up the mantle of what matters the most to their business interests, but they have taken up a share for something that matters to the entire economy. autopsy on this general topic we are talking about on this round table is why internet policy matters to start-ups but also to companies who are still start-ups at hard. as issues come in, policy makers have to make decisions are we going to be protectionists and protect industries that have been around. cindy crawford mentioned that her father was a manufacturer

of railroad ties, and when the next generation came out, he had to figure out what to do. we have to come up with new and better ways to improve our society, and i think the internet is a great catalyst for that. one other issue is the issue of patent reform. we have seen a surge in entities known as patent patrols that have gone after the larger internet companies. it has become a barrier to start-ups where you are trying to create a business and instead you have to deal with court cases. policy makers need to look at that also, and maybe people hatch thoughts on that issue as well. >> i want to take a minute here because we have around the table people from industry, academics, public servants. we have a moment here where we can -- where we should really have a discussion about what is

missing. what do we not know? what are some of the things juliet had raced about -- raised about giving broader con text to the issues we talked about. what are important areas for research, for discussion, to really dig in here as we look forward over the next couple of years. what are areas that really need a lot more attention so that we can make good policies, so that we can make good decisions? >> well, i think some of that has to start with education and engagement. i think that is one of the reasons why you are seeing internet companies come together and start grooms like the internet association. you are seeing sharing economies coming forward and sharing with government. for government to make good policy and to be thoughtful about it and how these companies are going to evolve

in the future and how policies work in the long-run, now is the time for a lot of engagement a lot of education and conversation so that the ground work is there for smart policy to be written, versus sort of where i have seen we have been for the last few years, which is sort of reactionary policy that is not necessarily based on a real understanding of the industry or the issues or where the industry is evolving in the future. i think that is sort of a joint responsibility for both government and our industry to really start that and continue that conversation, that dialogue and start building those bridges. >> i was going to say i think from a lowell legal thinking about it, a lot of our -- a local level thinking about it, a lot of our challenge is we can articulate what our goals are around rental service

housing on things like that, but it is very hard for us to get good data about how effectively or infectively these systems built by some of the more innovative companies in this space actually do or don't achieve those goals. a lot of the conversation is in the realm of anecdote. i heard about this time when this happened. of course the companies in the space have a vested interest in releasing certain data that tells a particular story. i think it is an area for people who are interested in public policy research to say what is the overall impact of a delimpry service alternative to the sharing base research, all tough to transportation available, to cost, to supply in areas that are under supplied and things like that, to actually give us some hard data we can playbook at to see how well these services do or don't support the policy objectives that we have.

>> i think carbon accounting is a really important aspect of the data. there are a lot of claims about the footprint lowering of these activities. at the moment, we don't really know much about how true the claims are. they just did a study. we are going to be doing more and more carbon counting in the coming decades, and i think this is an area where the whole industry could get out in front. in theory, it should be a happy story to tell and also to be a model for the kind of putting these accounting systems into place and being proactive about it. i think it could be really fantastic. >> it's interesting.

i have never encountered a politician who is anti-innovation, and very few are anti-internet, and yet innovation as we know has effects and consequences. we have talked about one of them. it can be disruptive. it can cause shifts in the workforce. and the difficulty that a lot of us engaged in public policy are engaged in is that oftentimes there is a quick reaction from policymakers. oh, we were for innovation until we started seeing these disruptive effects and now we need to put the brakes on it. i think these are all valid questions. look, we have a structure of labor law, of child safety laws, of privacy laws, and we might not agree on the structure, but those laws generally reflect the past consensus that those things are important to us. the format those laws take in

the future may be very different from the way they have taken in the past. i am not sure the protecting a taxi medallion system is the best way to ensure that we have a vibrant middle class. walmart faced a lot of criticism for having lower paid workers, and in part, because of pressure they were facing they voluntarily acted to give more robust health benefits. i don't know what went into that calculation, but i think they are probably thinking look, we are large employer of middle-class people. we think this is the responsible thing to do. i think as some of these internet businesses become more mature, companies will grapple with a lot of those effects as

well. with respect to policy, there can be a do no harm approach to players not acting quickly, but letting some of these things play out. i think some of these old values, older laws will manifest themselves in new ways, maybe more modern ways. >> just sitting here listening i was really struck by the comment that a lot of this debate is not about the internet. it has to do with what happening on the ground, and it's true. a lot of this has not been about patents of technology. people are sitting here saying that the nerds talk about that. i think what's happening is you're seeing technology is changing society in a way that is faster than institutions or government can keep up with. i know that. i've been first row seat. i walk away a little concerned

about how we're going to fix these institutions. at the local level, there are a number of folks around doing this that make me very optimistic, but when we look at congress, i don't know the path for that. i applaud the people working on that, but i don't think you have figured it out either. one thing i would ask all of you to keep in mind is we definitely in d.c. feel and attitude at times of well, government is broken, ignore them. but where are we going to be in 2030 if we keep that attitude and what are the choices you can make that will help improve our institutions, because you are forcing a lot of changes in society that have impacts far beyond who gets into a taxi? who is driving that taxi?

do they have healthcare? are a lot of people out of work? it is a rapid change that i am not sure our society can keep up with. a positive note to end on. >> we did ask -- we do have people at the table who have not had a chance to talk. chris, carrie, who else? down on dissent. -- this end. you want to add anything to the discussion before we wrap up? >> hi, i am from trip advisor. the lawyer in charge of vacation rentals. flipkey. flipkey.com, check it out. there are some of these companies that are disruptive companies that are starting to

take care of their -- they are not technically employees, but i guess contractors. they have set the minimum wage of $11.20 an hour. they are trying to treat them well by directing them and getting good deals on health insurance and cell phones and so on, tools they might use in their task. with companies that are sort of working through this -- and i know uber faced protests in seattle recently by their drivers who felt their pay was not high enough. i would not want to get into

bubeuber if i felt like my driver was not getting paid enough and was unhappy. i asked my driver this morning as she was feeling and she said we are alive and wonderful. i think companies like flip key and vacation rentals are not dealing with labor as much - >> we appreciate you bringing it up though. >> i think every uber driver i have had has been happy. i worked an zipcar before, so it interests me. i'm optimistic that these new companies will be able to find an outcome that is good for

workers, good for consumers. good for the economy. >> my name is matthew and i am with the harvard innovation lab. this has been a great discussion listening to all of your points. i want to make a comment combining sets and david's points. seth talked about infrastructure within the government and david about the dichotomy between those making the decisions and the consumers of the decisions made. the pattern here is how do we decrease the distance between the decision-makers and those the policy impacts? san francisco has a platform similar to open idea. they crowd source people living in the city to help solve problems and help decide how to repurpose land. new york is growing in participatory budgeting.

i see great opportunity for technology companies to help decision-makers decrease the social distance so that it has a more salubrious impact on society. >> my name is chris from reddit. i am really interested in the disconnect between congress and these companies and how quickly we are moving and users expecting things instantly. i think adam said you just have to look in the basement of a municipal building for a record, but now you can go get it. what are people expecting from congress in the time it takes to make decisions? that is something i'm interested in. i don't know the answer either, but i think with the instant gratification we all have -- you know, uber took longer than 20 minutes and refunded my money.

that is amazing. how does congress adapt to making that change? >> there is a big difference between policy deliberation and delivery of citizen services. when people think about technology and government, they kind of lump them all together. when you think about being able to see glass on the sidewalk take a picture, get it fixed that leads to a growing expectation that people should be able to do anything anywhere, at any time. having a deliberative body that is rapid is probably a bad idea. it would be different because you're making choices and doing things which is perhaps preferable to the current situation but you need better deliberation. this does bring up what i think is one of the scariest things about the internet with policy. there is a notion that you have a lot of companies that deliver

information to users based on what they think their users want. as we see it develop year over year you see a filter bubble where people only share with people who have their same worldview. and this is happening in politics. as people move to new positions and literally move to new geographies. i think it is affecting political debates. i wonder how we stop that. if the model for an internet company is we deliver what users want and try to make our robots deliver that instantly, that doesn't actually force them to deliver stuff. it actually reinforces their worldview. i don't know how that stops, but it reminds me that what is best for our users is not necessarily what is best for our citizens. we have to make sure we're cognizant of that. >> from monster.com. i want to circle back to the startups. what happened they should be

thinking about. if they are entering a regulated industry -- the risk reward ratio is entirely different for a civil servant than an entrepreneur. the first time there is a fatal accident due to a ride-sharing service, everyone will look to the government official that let that service operate. the risk is extreme, but there is no reward. whereas if you're starting at that service, the reward is a potential million-dollar enterprise. you have a lot of motivation to get there quickly and get it done quickly whereas the civil servant will be thinking, do no harm, take no risk. you need to keep that in mind. there's really no good way around that. except educating government officials as to why your service

will do no harm. i think sometimes the entrepreneurs go charging into the room does not realize the person they're meeting with, the government official, -- they are not just protecting special interests. there is risk avoidance for a reason. they are thinking do no harm. >> well, this is a really stimulating an interesting discussion, covering a wide range of ground. beginning with our initial discussion of the use to have first amendment around data online. ending with some of the challenges facing both government and startups, and navigate unfamiliar terrain. the challenges of these institutions. all in the midst of different kinds of change. i think on that note, i will let

our cohost give us some closing thoughts. >> i just want to thank maggie williams and the harvard staff for making this happen. i think it was a very productive conversation. i want to thank our moderators and all the participants. these are important issues as the policy landscape changes. next year, every of the same conversation, there will be new topics. that is exciting. this conversation helps to move the ball forward. thank you very much. [applause] >> on our next washington journal, correspondent lawrence hurley looks at president obama's executive order on immigration and a recent decision by a texas district court judge to temporarily block the order. then more about the case jon

feer and crystal williams on the challenges of immigration studies. washington journal is live every morning at 7:00 a.m. eastern on c-span. we'll have more coverage of the white house summit on countering violent extremism. president obama will deliver additional remarks at the conference this morning. that is live at 10:30 eastern here on c-span. our live coverage starts earlier on c-span 2. we'll hear from secretary of state john kerr and then ban ki moon. >> the political landscape has changed with the 114th congress. not only are there 43 new republicans and 15 new democrats in the house and 12 new republicans and one new democrat in the senate, there is the first african-american republican in the house. keep track of the members of congress using congressional

chronicle on c-span.org. there is lots of useful information there including voting results. new congress, best access on c-span c-span 2, c-span radio and c-span.org. >> now former defense secretary william cohen talks about u.s. security challenges and the impact of potential pentagon budget cuts. he was defense secretary during the clinton administration and served in the u.s. senate and house as a republican. this is an hour and 10 minutes.

>> good morning and welcome to the center for american progress. for our program this morning looking at the future of defense. a conversation with former u.s. secretary of defense, bill cohen. last year was a turbulent one for national security -- russia's aggression in ukraine extremists from isis, boko haram, the collapse of libya, and yemen, and then ebola in the pandemic crisis. domestically, the fractious political order make tough choices on defense difficult raising the risk of the ongoing sequester and misalignment of u.s. strategy with resources and investment. yesterday, a new secretary of defense, ashton carter, took the oath of office, and inherent in

-- and he inherits an in box and office filled with the most couple can challenges, and not much of a honeymoon facing him. so, as this debate on all of issues have keyed up, we are glad to welcome the former secretary of defense, william cohen, for a wide discussion on the future of american defense from how we manage difficult politics at home, to global areas of crisis, to juggling long-term, strategic priorities, and making smart investments. the conversation will offer insights into the way forward for america's national security during these turbulent days. now, a couple of things -- and then a little bit longer introduction on secretary cohen. first, cheering, catherine blakey, our defense policy analyst at the center.

she is working on her phd at the university of california. she is author, along with dr. lawrence court on a recent paper, "defense budget deja vu," published last week and available here on the website. i also know that in a former life, kate was the senior budget analyst for defense at the library of congress, but the pesky sequester has impacted some of the most capable and rising stars on the federal side, and here we are lucky to have kate as our defense budget expert. let me more formally introduced william cohen, currently the chairman and chief executive officer of the cowen group in -- officer of the cohen group in washington dc, but with an inbox that extends to almost every

capital of the globe. we know he serves on the judiciary committee in 1974 during the nixon impeachment hearings is a very young man but interestingly, as a house member, in 1974, he traveled to thailand to reestablish an ally following withdrawal from me in from vietnam. it turns out the policy for exiting the policy for exiting worst is every bit as complicated as getting involved so dealing with an ally in the war zone is trickier than it seems. case today. in 1978, he was sent to the senate, served on the armed services committee, and also chaired the government affairs committee on oversight, where computers were one of their early issues of inquiry. today, we live in the world of cyber, where the financial

interest, the news media, sony pictures, all deal with the security of their networks. the act first dealt with trying to move us into the 21st century. also served on the select committee for intelligence as vice-chairman, and then, in the late 1980's, as the council on foreign relations, chaired the middle east study group, a critical task, and as he was looking forward to the university of maine and other pursuits, president clinton, in january, 1997, asked william cohen to serve as secretary of defense. in a gesture of bipartisanship reminiscent of arthur vandenberg crossing the aisle to work with harry truman on securing the

passage of the marshall plan in the late 1940's, bill cohen stepped into the pentagon during a very challenging period for the united states. his three goals for his tenure were succeeding in the modernization of the military, and maintaining its readiness to fight. his successors at the pentagon inherited a military that was ready to go, dealing straightforward with recruiting and retention problems, making sure we were bringing in the most capable people, taking care of their quality of life, and making sure that they had a first-class housing to live in and then strengthening security relationships with countries around the world. i was honored to be part of their leadership team, both as undersecretary for personnel and readiness, and later, deputy secretary of defense, but it was

clear that secretary bill cohen was engaged, made some of the most important missions to the middle east, the most senior official of the u.s. government to meet with young assad as he took over syria in a straightforward dialogue that reminds us of the challenges facing serious then and now. now, he is also in his spare time, the author of 13 works of nonfiction, fiction, and poetry. his next book, "collision," will come out on june 30 and deal with asteroid mining. given his preceding work on computers a decade ago, we will be interested to know where the asteroid issues take us now that we are capable of landing on asteroids. he is also a member of the new england all-star hall of fame

for basketball players, the great sport of his career, and had he not been a public servant, may have been a professional basketball player. so, after 31 years of service, secretary william cohen has left a record of unparalleled incompetent, integrity, and respect, and he brings to this program, and this discussion and unrivaled knowledge and reputation relationships across america and around the globe turn we are very happy to have him today for this program on national security. so, kate, and secretary william cohen, thank you very much. [applause] >> well, secretary cohen thank you for joining us today. we are looking forward to a broad ranging conversation on

the challenges we face. domesticically and internationally. secretary cohen: i would like to say word of thanks to rudy. there was a book written called "the quiet american," a novel. rudy is a quiet american. he is probably the most quiet, influential voice in washington, and has he mentioned, he and i have known each other a long time. when he was the staff director for the house armed services committee, and then serving over the pentagon -- people still come to him for insight and advice, and most recently, he managed the transition for ashton carter during his confirmation process. thank you for arranging for me to be here, and john podesta, of course, i worked with him for four years at a pleasure to be with all of you. katherine: wonderful. the way i would like to structure the conversation is starting with more domestic

concerns and then broadening into the international arena. there is no shortage of hotspots and trouble issues around the world, but let's start with my daily with, the defense budget. it is coming in at about $35 billion over the pentagon's cap, so there is a dilemma unless congress amends the cap or makes tough choices on what to appropriate to under the cap the pentagon will face another sequester, like in 2013. you have been a long advocate of sensible defense reform, military compensation reform reducing the amount of the back-office personnel, and greater efficiencies in the pentagon operations. the budget makes a lot of these recommendations, but it is not the first time we have seen nearly all of these recommendations. like in past submissions, many seem dead on arrival. the prospect of a bipartisan deal for sequester relief are also looking slim. what is your assessment of how the republican congress will

handle this dilemma? secretary cohen: first, let me say, with respect to sequester, i think that has been an exercise in political malfeasance. the notion that you would endorse across-the-board cuts without regard to requirements irrespective of strategy, to me, is a forfeiture of public trust, and i think anyone who subscribes to that should be removed from office. i would hope that the first thing secretary carter would do would be to push for an elimination of the sequester process, and go back to appropriating, as we once did. so, and i encouraged that they will do that? the answer is no. i think there is such division amongst republicans at this point, even though in charge of both houses, that there is a debate that will take place between those that are committed

to reducing the federal debt and annual deficits, and those that are committed to an internationalist approach to the united states. frankly, i think we have yet to decide who we are, and what america's role is. rudy used the word turbulent. what is america's role in a world of constant turbulence? we have not seen a more difficult situation in which the instability is coming at us with a velocity not seen before. so, what is our role, and, frankly, i do not know what our role is going to be, what the congress is going to decide, or what the president is going to decide. in my judgment, the president has been pursuing, until recently a policy of disengagement.

we were out of iraq until recently. we were getting, pretty much, out of afghanistan. we were not getting involved in syria. we were not getting involved in ukraine. we were shifting focus over to the asia-pacific region, and assuming that europe could handle itself, and that there was no russian threat at that time, so our policy has been one shrinking back. almost nation-building at home, and that was coming from republicans on the right, on the libertarian side, and democrats on the left. so, we have to decide, looking at the landscape today, and what is likely to take place in the future, what should be the role of the united states? is it disengagement or engagement? is it leading from behind, or is it as the germans -- by the way, i was in munich a week or so ago, and the germans defense secretary said germany's role was to lead from the center. i do not know what that means.

i don't know what that mean. so, we have to decide what will the united states will play. we do know this, when we disengage, when we pull back bad things happen. so, we have to decide our role in the world. we have to decide whether we are willing to appropriate the kind of dollars necessary to fulfill that role, or we are going to sit back and see events take place in which we have very little influence. katherine: thank you. on this term of disengagement, and reengagement, let's talk a little bit about nato. you came back from munich. nato would be facing a difficult year with a drawback from afghanistan in a reassessment of what the nato alliance means. in some ways, the ongoing aggression from russia has put the role of the nato mission in very clear relief. what do you see forward as the path for nato given the curren