look forward to your testimony and question and answer period. your written testimony will be made part of the record in its entirety and you can proceed briefly to what you want to tell us. >> chairman shelby, ranking member brown and members of the committee, i'm pleased to present the federal reserve's semi-annual monetary policy report to the congress. in my remarks today, i will discuss the current economic situation and outlook before turning to monetary policy. since my appearance before the committee last july, the employment situation in the united states has been improving along many dimensions. the unemployment rate now stands at 5.7%, down from just over 6% last summer and from 10% at its peak in late 2009. the average pace of monthly job gains picked up from about

240,000 per month during the first half of last year to 2880,000 per month during the second half and employment rose 260,000 in january. in addition, long-term unemployment has declined substantially. fewer workers are reporting that they can find only part-time work when they would prefer full-time employment and the pace of quits, often regarded as a barbarometer has recovered to its pre-recession level. the labor force participation rate is lower than most estimates of its trend and wage growth remains sluggish, suggesting that some weakness persists. in short, considerable progress has been achieved in the recovery of the labor market but room for further improvement

remains. at the same time that the labor market situation has improved, domestic spending and production have been increasing at a solid rate. real gross domestic product estimated to have increased at 3.75% at the annual rate. g.d.p. growth is not anticipated to be sustained at that pace, it is expected to be strong enough to result in the further gradal decline in the un-- gradual decline in the unemployment rate. the increase in household purchasing power resulting from the sharp drop in oil prices. however, housing construction continues to lag. activity remains well below levels we think should be supported in the longer run by

population growth and the likely rate of household formation. despite the overall improvements in the u.s. economy and the u.s. economic outlook longer term interest rates in the united states and other advanced economies have moved down significantly since the middle of last year. the declines have reflected at least in part disappointing foreign growth and changes in monetary policy abroad. another notable development has been the plunge in oil prices. the bulk of this decline appears to reflect increased global supply rather than weaker global demand. while the drop in oil prices will have negative effects on energy producers and will probably result in job losses in this sector, causing hardship for affected workers and their families, it will likely be a significant overall plus on net for our economy.

primarily that boost will arise from u.s. households having the wherewithal to increase their spending on other goods and services as they spend less on gasoline. foreign economic developments, however, could pose risks to the u.s. economic outlook. the pace of growth abroad has stepped up slightly in the second half the last year, foreign economies are confronting a number of challenges that could restrain economic activity. in china, economic growth could slow more than anticipated as policy makers address financial vulnerabilities and manage the desired transition to less reliance on exports and investments as sources of growth. in the euro area, recovery remains slow and inflation has fallen to very low levels. although very accommodate i have

policy should boost economic and economic activity. the uncertainty surrounding the foreign outlook, however, does not exclusively reflect downside risks. we could see economic activity respond to the policy stimulus now being provided by foreign central banks more strongly than we currently anticipate. and the recent decline in world oil prices could boost overall global economic growth more than we expect. u.s. inflation continues to run below the committee's 2% objective. in large part, the recent softness in the all items measure of inflation for personal consumption expenditures reflects the drop in oil prices. indeed the p.c.e. price index edged down during the fourth quarter of last year and looks

to be on track to register a more significant decline this quarter because of falling consumer energy prices. but core p.c.e. inflation has also slowed since last summer, in part, reflecting declines in the prices of many important items and perhaps also some pass-through of lower energy costs into core consumer prices. despite the very low recent readings on actual inflation inflation expectations, as measured in the range of surveys of households and professional forecasters have thusfar remained stable. however, inflation compensation as calculated from the yields and nominal treasury securities has declined. as best we can tell, the fallen inflation compensation mainly re flects factors other than a

reduction in longer term reduction expectations. the committee expects inflation to decline further in the near term before rising gradually towards 2% in the medium term as the labor market improves farther and lower energy prices and other factors dissipate. but we will continue to monitor inflation developments closely. the federal open market committee is committed to policies that promote maximum employment and price stability company knt with our mandate from the congress. as my description of economic developments indicated, our economy has made important progress towards the objective of maximum employment, reflecting in part support from the highly stance of monetary

policy in recent years. in light of the progress towards maximum employment and substantial improvement in the outlook for labor market conditions, the stated objective of the committee's recent asset purchase program, the fomc concluded that program at the end of october. even so, the committee judges did a high degree of policy accommodation remains appropriate to foster further improvement in labor market conditions and to promote a return of inflation towards 2% over the medium term. accordingly, the fomc has continued to maintain the target range for the federal funds rate at zero to one quarter percent and keep the holdings of longer term securities at their current

elevated level to help maintain financial conditions. the fomc is also providing forward guidance that offers information about our policy outlook and expectations for the future path of the federal funds rate. in that regard, the committee judged in december and january that it can be patient in beginning to raise the federal funds rate. this judgment reflects the fact that inflation continues to run well below the committee's 2% objective and there is room for sustainable improvement in labor market conditions still remains. the fomc's assessment that it can be patient in beginning to normize policy means that the committee considers it unlikely that economic conditions will warrant an increase in the target range for the federal funds rate for at least the next couple of fomc meetings.

if economic conditions continue to improve as the committee anticipates, the committee will at some point begin considering an increase in the target range for the federal funds rate on a meeting-by-meeting basis. before then, the committee will change its forward guidance. however, it's important to emphasize for the modification of the forward guidance should not be read as indicating that the committee will necessarily increase the target range in a couple of meetings. instead, the modification should be understood as reflecting the committee's judgment. the conditions have improved to the point where it will soon be the case that the change in the target range could be warranted at any meeting. provided that labor market conditions continue to improve and further improvement is

expected the committee anticipates that it will be appropriate to raise the target range for the federal funds rate when, on the basis of incoming data, the committee is reasonably confident that inflation will move back over the medium term to our 2% objective. it continues to be the fomc's assessment that even after employment and inflation and near levels consistent with our dual mandate, economic conditions may for some time warrant keeping the federal funds rate below levels the committee views as normal in the longer run. it's possible, for example, that it may be necessary that the federal funds rate to run temporarily below its normal longer-run level because the resideal effects of the financial crisis may continue to

weigh on economic activity. we would expect the federal funds rate to move towards its longer run normal level. in response to unforeseen developments, the committee will adjust the target range for the federal funds rate to best promote the achievement of max -- maximum employment and 2% inflation. let me turn to the mechanics of how we intend to normalize the stance and conduct of monetary policy when a decision is eventually made to raise the target range for the federal funds rate. last september the fomc issued its statement on policy. it provides information about the committee's likely approach to raising short-term interest rates and reducing the federal reserve's security holdings. as is always the case insighting

policy, the committee will determine the timing and pace of policy normalization so as to promote its statutory mandate to foster maximum employment and price stability. the fomc will adjust the stance of the policy during normalization by changing its target range for the federal funds rate and not actively managing the federal reserves balance sheet. it has the tools it needs to raise short-term interest rates when it becomes appropriate to do so. and to maintain reasonable control of the level of short-term interest rates as policy continues to firm thereafter even though the level of reserves held by deposit tower institutions is likely to diminish only gradually. the primary means of raising the

federal funds rate will be to increase the rate of interest paid on excess reserves. the committee will also use an overnight facility and other tools as needed to help control the federal funds rate. as economic and financial conditions evolve, the committee will phase out these supplementary tools when they are no longer needed. the committee intends to reduce its security holdings in a gradual and predictable manner primarilyly seeking to re-invest payments from principal. it's the committee's intention to hold in the longer run no more securities than necessary for the efficient and effective implementation of monetary policy and that the securities be primarily treasure

securities. in sum since the july, 2014 monetary policy report, there has been important progress toward the fomc's objective of maximum employment. however, despite this improvement, too many americans remain unemployed or underemployed, wage growth is still sluggish and inflation remains below our objective. the federal reserve remains committed to employing its tools to best promote the attainment of its objectives of maximum employment and price stability. thank you. i would be pleased to take your questions. >> madam chair, i want to get into measures of inflation. you touched on that a little. the federal reserve, i understand currently uses an inflation measure of core personal consumption

expenditures which ex cludes volatile food and energy prices. several alternative measures of inflation exists including one called the trim mean p.c.e. which strips out a larger basket of items from the calculation. i know you know all this. do you think that the federal open market committee should incorporate alternative measures of inflation such as trim mean p.c.e.? and could you explain to us the risk of not properly gauging inflation expectations? >> so, let me first say that the federal open market committee's 2% objective refers to the increase -- the annual increase in the total p.c.e. price index that includes food and energy. food and energy are very important components of every

household spending basket, and i don't think it would make a lot of sense or be acceptable to americans to focus on a measure that strips out these important components of the consumer basket. so we focus on total consumer prices including food and energy. at the same time, we recognize that food and energy are particularly volatile prices and in order to get a better forecast sometimes of the underlying trends in inflation we do look at so-called core inflation that strips out these measures. and in trying to understand trends in inflation and the factors impacting inflation we look at a broad variety of measures in in inflation,

although our formal index is the p.c.e. index. we look at the c.p.i. which is well known to most americans and trim means and other measures that you cited. are you you talked about the use of policy which would provide the feth with a way to conduct policy in response to changes in economic conditions. i believe it would also give the public a greater understanding of and perhaps confidence in the fed's strategy. you stated and i quote, rules of the general sort proposed by taylor capture well a statutory mandate to provide maximum employment and price stability. you have expressed concerns, however, over the effectiveness of such rules in times of economic stress. would you support the use of a

monetary policy rule of the fed's choosing if the federal had discretion to modify it in times of economic disruption? >> i'm not a proponent of chaining the federal open market committee in its decision making to any rule whatsoever. but monetary policy needs to take account of a wide range of factors, some of which are unusual and requires special attention and that's true even outside times of financial crisis. in its original paper on this topic, john taylor himself pointed to conditions such as the 1987 stock market crash that would have required a different response. i would say that it is useful

for us to consult the recommendations of rules of the taylor type and others and we do so routinely. and they are an important input into what ultimately is a decision that requires sound judgment. >> in a recent speech richard fisher, the president of a federal reserve bank has suggested a reorganization of the federal open market committee, specifically advocates for a rotating vice chair manship and a stronger role for regional banks on the committee. do you support any of mr. fisher's proposals and why or why not? >> senator shelby, i think the current structure of the federal open market committee and the voting structure was decided on by congress a long time ago

after weighing a whole variety of considerations about the need for control in washington and the importance of regional representation. it's of course something that congress could have revisitted. but i would say it has worked very well. we have a broad range of opinion that's represented at the table and active debates. the decision to appoint the president of the new york fed as vice chair reflected the reality that the new york fed conducts open market operations on behalf of the system and has special and deep expertise pertaining to

financial markets. and i think that's worked well and continues to be true that there is special expertise in new york. >> a recent article written by two economists for "the think tank e-21," proposes to reducing the number of districts from 12 to 5 and making all voting members of the federal open market committee. the article states that this would preserve regional diversity by giving more authority over monetary policy over reserve banks that currently voting members and could have safety and soundness and remove the uncertainty created by 19 independent fomc members. do you oppose consolidation of federal reserve districts? >> this is a matter for congress to to decide. restructure of the federal reserve reflects choices that were hammered out 100 years ago

and i think the current structure works well. so i wouldn't recommend changes but again, the federal reserve plays an important role in their communities but again this is up to congress to consider. >> my last question to you in this round asset threshold for banks. a recent report by the office of financial research shows a large disparity and systemic risk between the largest banks and those that are smaller and closer to $50 billion in assets. all banks above $50 billion are under regulation. do you think the findings of the the office of financial research should be incorporated, considered or what kind of

determination of whether a bank is systemicically significant? >> we absolutely recognize in the federal reserve that the largest banks and those closer to $50 billion are quite different in terms of their systemic footprint and we have many different measures that help us decide on the systemic importance of an institution and there obviously are large differences there. in dodd-frank, congress gave us the ability to make it appropriate to the systemic importance and complexity and size of a bank and to the maximum extent possible within that legislation, we have tried to use the powers that we have toll appropriately tailor our

supervision and regulation. for example, we recently proposed extra capital charges on the largest and most systemic institutions and higher lerge requirements and those requirements would not apply to the smaller institutions, but there are many other examples as well. >> do you know of any community or regional bank that has caused systemic risk to our economy? >> there may have been episodes in which there were bank failures of smaller banks that did threaten systemic consequences. but certainly -- >> i believe you chose your words carefully. could you furnish any of the record whether smaller banks or

regional banks have caused systemic risks to our economy or banking system. would you furnish that to us? >> i will look into it. i'm trying to agree with you that -- >> by and large, that has not been the case. and i agree with that. >> senator brown. i have one comment about your answer to your last question. about capital requirements that you have applied. there is no question as reports made pretty clear made for a financial system. senator vitter has had special interest and so has senator shelby. you mentioned in your opening statement, you gave a speech on income and wealth inequality and

that is through a robust job-creating economy. what steps ruin corporating to incorporate that into monetary policy decisions? >> we are very committed to both parts of the dual mandates price stability and maximum employment. we have been running a very accommodating monetary policy in order to promote stronger conditions in the labor market. we have been monitoring a wide variety of indicators of labor market performance not focusing on any single measure and in particular for example, the large magnitude of part-time involuntary employment, workers who want full-time jobs. the decline in labor force participation, part of which we understand to be or believe to

be cyclical. these are things that we're monitoring very closely. we're also looking at wage growth and the fact that wage growth is really not picked up very much during this recovery, i take to be another signal that although the labor markets improving, we have further to go and we want to promote full recovery.

>> real wages tend to rise more rapidly in a strong labor market. so i interpret part of that phenomenon as a signal, a sign that the labor market is not yet fully recovered. but i should also say, there are longer term structural factors that may also be affecting the shares of the pie that accrues to labor and capital. one of these factors, recent research points to the fact that many labor-intensive activities in the global production chain are being increasingly

outsourced and that phenomenon has tended to push down the share of income going to labor as opposed to capital over the last decade or so. there is research on this topic. so i think it's a combination of structural factors, but also remaining cyclical. >> and that includes the labor of organization of workers of being organized? >> that could include that as a factor. >> i appreciate the steps that you and your predecessor made to bring greater transparency. there is a proposal to go one step further and audit the fed's monetary policy deliberations. what are your thoughts on that? >> i want to be completely clear that i strongly oppose to audit the fed. i believe the transparency and providing congress and the public with adequate information

to be able to understand our operations, our financial condition, the conduct of our meeting the responsibilities that congress has assigned to us is essential but audit the fed is a bill that would politicize monetary policy and would bring short-term political pressures to bear on the fed. in terms of openness about our financial accounts, we are extensively audited. i brought with me this volume which contains an independent outside auditor's audits of our financial statements. for people to understand what auditing is about the federal

reserve is extensively audited. what i think is critically important is that the fed be able to deliberate on the best way to meet the responsibilities that congress has assigned to us to achieve maximum employment and price stability and that we be able to do free of short-term political pressures. i would remind you that in the early 70's when inflation built and became an endemocratic problem in the u.s. economy history suggested that there was political pressure on the fed that interfered with its decision making. it was in the late 1970's, that congress put in place the current feature of law that exempts monetary policy deliberations and decisions for one area that's exempted from

g.a.o. audits. and i really wonder whether or not the volcker fed would have had the courage to take the hard decisions that were necessary to bring down inflation and get that finally under control something i think that has been very important to the performance of the u.s. economy. i wonder if that would have happened with g.a.o. reviews in real-time of monetary policy decision making. so central bank independence in conducting monetary policy is considered a best practice for central banks around the world. we are one of many, many central banks that are independent and academic studies i think establish beyond a shadow of a doubt that independent central banks perform better. the economies perform better and

have better performance in terms of inflation and macroeconomic stability. >> you mentioned your community advisory council. what are you encouraging regional banks' presidents to follow suit? >> most of the regional banks are active in their communities. they have community development programs and are really trying to address special needs of their communities. but in washington, we also encourage and have oversight of those activities and strongly encourage similar practices. . >> senator crapo. >> i would like to use my time going over the process that we are in right now. the first economic growth and regulatory act or gripa review states besides reviewing our

existing regulations in order to get rid of burdens, they are getting ridding of burdens. the report submitted to congress specifically discussed financial consumer issues, anti-money-laundering issues and recently adopted rules. however, included in the federal register put forward for this current process that we are now anywhere we are supposed to be having our financial regulators, by law look for outdated, unnecessary and unduly burdensome regulatory requirements in the system, there was a couple of footnotes included that said that the agencies engaged are going to back off. they are not going to review new regulations that have gone into

effect and not review regulations that were considered and will go into effect in the process and have clarified that the c if fpb won't be in the process. the consumer financial protection bureau won't be in the process. would you not agree that we should have a thorough process that reviews all rules and the consumer financial protection bureau should be a part of the process. before i put that question to you, i would like to say, we had a hearing last week, which was dealing with community banks and credit unions and the regulatory burdens that they face. and i asked the witnesses and every one of them said that in the set of rules and regulations that they feel are creating unnecessary and unduly burdensome pressures are rules and regulations coming from the consumer financial arena and the

anti--money-laundering arena and the dodd-frank arena, which would be exempted. a couple of examples they gave were the qualified mortgage rule that needs to be reviewed. the volcker rule that needs to be reviewed and yet all of this is apparently outside the scope of the entire process that the agencies are now undertaking. could you respond please. >> so in the rules that have gone into effect or in the process under consideration and will go into effect related to dodd-frank, we had federal register notice, took public comments and important part of designing those rules was considering the costs, the burdens and what was the most effective and appropriate way of designing regulations to meet

dodd-frank's objectives. so in the sense what it asks of the agencies is something that we have gone through very recently in the process of designing regulations, in some cases that have not yet gone into effect. >> your answer be the same for the consumer financial protection -- because it's new, we don't need to review its rules? >> i can't speak to -- we don't have that rulemaking authority and i can't speak to what rule the cfpb will play. >> i understand the argument. and that's the argument we got from the regulators two weeks ago. but it's not what it is saying. it doesn't say let's review the rules and regulations that are old. it says let's review them all. that's what the law that was

passed to do. recently been through the process and they have been through the process. the dodd-frank legislation was 1848 pages long. but the page count of the regulations required by dodd-frank has mushroomed to 15,000 pages so far and they aren't finished and over 15 million words of regulatory texan to say the fact they are new and the implementation process has recently been completed on them, i don't think is a satisfactory response to them and they need to look at the relations and get rid of those that are unnecessary or burdensome. >> we will be holding public hearings and taking extensive comments. you mentioned community banks. we are focused on trying to find ways to reduce the burdens on

community banks and during this process will be very sensitive to looking for ways in which we can reduce the burden of regulation and will be reporting back to you. >> my time's up. i would encourage you and the other federal regulators to focus on the full intent of this and expand your review. thank you. >> senator reed. >> it has significant responsibilities in many areas, one is monetary policy. but one of the areas, regulatory policy supervising large institutions. and it goes back to the new york federal reserve. and several of us have had proposals to help, we hope this

regulatory oversight effort has been criticized, not only in the run-up to 2008 but even recently. can you describe what you have done for greater accountability in new york city? >> so in the aftermath of the hearings that were held here and the allegations that were raised about the new york fed we have undertaken an internal review and that is in process. now i should say that the question we think is important that was raised there. we have a process for supervising the largest banks that is a system-wide process and involves system-wide committees and is led by washington, by the board. the reserve banks that are

involved with the supervision of the institutions in that large bank portfolio, take part in the process that is a group-wide and board-led process. so the question we thought that is important for us to look at is are we in that process, the board and the group that supervises these banks and makes decisions, is the relevant information being fed up to the highest decision making levels, including the board of governors and to the extent that within a reserve bank supervision team, there may be difficult veering ent opinions. we want to make sure that dissident voices are heard and dissident views can reach the highest levels for consideration. so that is the question that was asked our internal team to look

at. the review includes the new york fed, but other reserve banks that are also involved in large banks' supervision, because avoiding group think and making sure that dissident views can be heard at the highest levels is really critical to sound supervision. we've also asked our inspector general to undertake his own independent review and these are in process and i expect them to be completed this year.

>> we will certainly take any administrative changes that appear to be called for you would like to wait and see the findings of the reviews before deciding on the appropriate measures. >> my time has expired. one issue on the table and follow up with a question. we are acutely sensitive to systemic risk and in dodd-frank we tried to minimize that risk by clearinghouses that would take bilateral transactions and derivative swaps and that introduces a degree of risk.

and i just want to put on your screen or is the sensitivity that we have to oversight of these clearinghouses, both our own and others across the globe because of the potential systemic problem. can i just put that on the table? >> absolutely. and i want you to note that we are very attuned to the need to be careful in our supervision that we've taken the step forward, i think, as you mentioned in moving the great deal of clearing to clearinghouses. financial market utilities and they have been designated as

important, financial market utilities. and they are being supervised by the federal reserve. there are a set of principles put in place and agreed globally for what are best practices in terms of liquidity standards and other risk management standards for these financial market utilities and it is extremely high priority for us to make sure we enforce those standards and we are in the process of doing so because although these entities reduce risks that were previously present they create their own risks if they are not appropriately managed. i agree. we are giving it a great deal of attention.

>> senator corker. >> thank you for being here today. there is a push to add a provision addressing currency manipulation in the asiaian hifere pacific trade deal. you think trade negotiations or an appropriate place for these issues and what includes the arbitration panel under the enforcement procedures where companies or other nations could challenge future monetary policy decisions by the federal? >> so let me first say that i think currency manipulation that is undertaken in order to alter the competitive landscape and give one country an advantage in international trade is inappropriate and needs to be addressed. but that said, there are many factors that influence the value

of currencies, including differences in economic growth and capital flows and as you mentioned, monetary policy is a factor that could happen on currencies. so i would be concerned about a regime that would introduce sanctions for currency manipulation into trade agreements when it could be the case that it would hamper or even hop will monetary policy. monetary policies, we have undertaken the federal reserve has undertaken over the last number of years, have been designed for valid domestic objectives whose price stability and maximum employment. we have undertaken monetary policy to achieve those

objectives and that is not currency manipulation but it affects the economy through many channels. perhaps more importantly through interest rates but monetary policy may have impact on currency values. so i would see that kind of direction as having the potential to perhaps hamper the conduct of monetary policy or hobble the conduct of monetary policy. >> that's a long answer, but the answer i think you just said you would have a significant problem with that being part of a trade deal, is that correct? >> yes, i would. >> i want to follow the fed -- auditor fed question a little bit and if you need a break, that would be good. the first is with respect to the fed's lending facility and the discount window access during

the financial crisis. there is questions about how these facilities were questioned but congress addressed this issue through the sanders' amendment to dodd-frank. can you respond to g.a.o.'s ability to audit credit facilities? >> in response to that amendment, the g.a.o. conducted a complete review of the use of our 13-3 emergency lending lending authorities and all of the programs that were created and conducted in audits that was concluded, i believe in mid-2011. in addition, the g.a.o. has the ability to audit open market operations and discount window lending and we now report regularly all the details -- the details of our open market operations and with the two-year

lag our discount window lending. >> they are fully transparent and fully auditeded, correct? >> that's correct. >> the size and condition of the balance sheet. does the fed disclose the type of assets that make that up? >> yes. we have audited financial statements which i have a copy of right here. we report on a security-by-security basis all of the securities that are in that portfolio. they are reported on the new york fed's web site. and we have a weekly balance sheet that reports significant details of our balance sheet. >> i hate to ask this question but i read some quotes lately and -- not by you but by audit

federal advocates. how do we know the securities actually exist? >> we have an outside accounting firm, an independent auditor that does a thorough review of our balance sheets and that's what's contained in our annual report. both the board and all of the federal reserve banks and the consolidated federal reserve system. >> so they do exist? >> they do exist. >> my last point, it's obvious to me that the audit the fed effort is to not address aweding the feth because the fed is audited and every day you publish the numbers of the things that you own and the credit facilities that you put in place during an emergency. all of that is audited now. to me it's an attempt to allow

congress to be able to put pressure on fed's members relative to monetary policy and i would just advocate that will not be a particularly good idea and would cause us to put off tough decisions for the future like we are currently doing with budgetary matters, do you agree with that? >> i strongly agree. as i indicated -- well let me say more generally, if you look around the globe in modern times and you consider every country that has gone through a period of chronic high inflation or hyperinflation what you will find is a central bank that was pressured to print money by politicians who are unable to balance the budget. >> i thank you, mr. chairman. i do think one area that greater transparency could be utilized

is in the regulatory area. i think that that's an area where we should focus and i hope that over the course of the next several months, the fed will work with us in a constructive manner so we more fully understand how you go about that process. it does seem like a black box now and something should be more transparent and will be happy to work with you in that regard. >> senator schumer. >> thank you, mr. chairman. thank you for your hard work and dedication and sound judgment and timely decision making have been a driving force beyond the recover. ry. you and other members have important decisions to make in the coming months. let me urge you to act with caution before raising rates. while there may be some -- while there may be data points,

positive signs of economic growth, let me be clear. i believe the fed should remain committed to its policy until it sees clear evidence that shows a consistent improvement in wages. in the current environment, wage growth meeds to be a major factor and a loadstar for the fed whether deciding to raise rates. as i have said over and over again, to me, the single biggest problem is decline of middle-class incomes strong expectations for growth of g.d.p., wage gains have remained sluggish through the recovery, middle-class americans have not seen the benefits of this growth in their take-home pay. we know the statistics is declining by 6.5%. 3,6000 hours lower than when

president bush took office in 2001. it could reduce demand and hamper growth. wage growth not only serves to benefit middle-class workers who have been asked to do more with less. prior to raising rates serves the dual role towards the fed's 2% target. overall growth is rightfully a key factor in the decision, but i firmly believe the fed shouldn't raise rates until wages are back on a steady trend, steady upward trend. as you begin to consider the path towards normalization of rates, the fed must place a priority on seeing real wage growth prior to any decision making. those who are worried about inflation, you always have to worry about it, but they should look at the last several years. there are a few signs of inflation and many economists believe that the chances of

deflation are greater and concerns of deflation are further precipitated by the prospect of the fed raising rates too soon. i think it is prudent decision for our broader economy as well as middle-class families to wait until wages really begin to rise. so, first, do you agree it's critical for the fomc to see evidence of consistent wage growth prior to deciding to rise interest rates and set that it is climbing above the 2% target and if it doesn't wait, what are the potential consequences? >> senator our objective is price stability, which we define as 2% inflation. and as i indicated before beginning to raise rates, the committee needs to be reasonably

confident that over the medium term, inflation will move up towards its 2% objective. i don't want to sit down any single criterion that is necessary for that to occur. the committee does look at wage growth. we have not yet seen -- there are perhaps hipts -- but we have not yet seen any significant pickup in wage growth. but there are a number of different factors that effect the inflation outlook. and we will be considering carefully a range of evidence that pertains to the inflation outlook and will determine the confidence that we feel in our -- we forecasted that inflation will move back up to 2%. certainly seeing continued improvement in the labor market adds to that confidence and it would add to our confidence also

that over time wages will pick up. but our objective is 2% inflation. and we will look at a wide range of evidence in deciding that. >> do you feel that the worry of rampant inflation is any greater than the worry of deflation given the flatness of wages, 70% of the economy is wages jobs, broadly defined? >> the committee feels -- i think anticipates the inflation is being held down by factors particularly the decline we have seen in oil prices. we have also had considerable slack in the labor market and it's diminishing over time. wages tend to be a lagging indicator of improvement in the labor market. we have seen improvement and if

we continue to see improvement, it would add to my confidence, especially as the impact of oil prices diminishes over time that inflation will go back up. >> do you see any real evidence of inflation heading above 2% right now? >> i don't. but inflation, we need to be forward-looking. the committee is forward-looking in setting monetary policy. we see that the labor market similar proving and we're getting closer to our goal of maximum employment. it's important to remember that monetary policy is highly accommodative. we've held the federal funds rate at a zero to .25% range and have a large balance sheet and these policies have been in place for six years now.

we do have an economy that fortunately appears to be recovering and we do have to be forward-looking in setting monetary policy. but i want to assure you we want to see that recovery continue. we don't feel the labor market is fully healed and that's a process we want to go on and we don't want to take policy actions that will hamper that. but monetary policy is very accommodative. >> thank you. i urge caution. >> thank you mr. chairman. thank you, madam chairman, for joining us today. let me share a completely opposing point of view from that of the senator from new york. which will not be a shock to members of this committee. i can't help but observe what strikes me as a very obvious paradox here and that is the financial and economic crisis is over. it's been over for years. at least six or seven years. and yet we still maintain crisis-level interest rates.

we've got no wave of defaults or massive bankruptcies going on. we have unemployment has gone from 10% to sub-6%. g.t.p. growth has been week. i think that's easily explained by the -- weak. i think that's easily explained by the avalanche of regulations. but it's been positive for years. consumer sentiment is relatively high. the fomc in january described the economic recovery as solid. wal-mart interestingly has made an announcement that suggests we might even be approaching naru. the crisis has been over for a long time. and it's not as though there's no price to be paid by having this unbelievably accommodative policy. most immediately i see the problem incurred by my constituents who may have spent a lifetime working hard, sacrificing, saving, foregoing a vacation they might have

taken, foregoing a splurge here and there so they could save for their retirement and buy a c.d., have some money on deposit at a bank, and use that to supplement a modest pension or social security payment. of course their reward now is they get nothing. zero. that's what they earn on their savings year after year. meanwhile, of course we have all the risks associated with this. the risk of bubbles forming, i would argue the fixed income markets probably are a huge bubble at the moment. we have the inhibition of price discovery and financial sector. we facilitate excessive deficits because they look so manageble with zero interest rate environment. credit is rashed. and what are the benefits of this? the benefits are at best a timing shift in economic activity. at best we're moving economic activity that would otherwise occur in the future closer to the present, as we all know if artificially low interest rates

led to strong economic growth, then everyone around the world would have zero interest rates and everything would be booming and that's not the case. so i know you and i disagree on this, but i would just suggest the crisis is clearly long over. i think the time for normalization is well overdue. i hope we get there soon. i want to spsk a specific question that's related and that is, you've said repeatedly that the goal of price stability is 2% inflation. well, certainly there's a congressional mandate on price stability. but when the fed decides that it's acceptable, and in fact that that is met by savers losing 2% of their purchasing power annually and let me put that a different way that means a 30-year-old woman who is saving, by the time she retires, what she has saved at that point will have lost half of its value. half of it's gone. how is that consistent with price stability? >> the federal reserve is the fomc in carrying out congress' mandate. really does have to define how

we understand price stability operationally. 2% inflation is an inflation rate that we chose largely for two reasons. first of all, it's well known that price indecembers that we look at contain upward biases in part because their failure to adequately capture the benefits of new goods and quality improvement, so they are hard to measure, but nevertheless upward bias in price ideces. and because inflation is so dangerous and because an environment of very low inflation and one of comparably extremely low interest rates makes it difficult for monetary policy to respond to adverse shots. we decided that in order to

avoid damaginging episodes of deflation, it's wise to have a small buffer that gives greater room for monetary policy to operate. >> thank you. i'm going to run out of time here. i want to get to my second question. i would just urge you to consider the impact of savers losing their purchasing power. historically of course we have changed a level of accommodation through open market activities, typically buying and selling securities to have correspondinging changes in the level of cash. you've suggested, if i understand you correctly, that in the process of normizing assuming weet get to that process, you intends to achieve that principally by changing the target level of the fed's fund rate and you'll do that by increasing the interest on excess reserves. and my question is since that means over time, in a normalizing environment, the transfer of tens of billions of

dollars from what would go to the taxpayers to big money-center banks, why are you doing that instead of simply sellinging the bonds, which is a more conventional way to operate in the open market operation? >> remember that first of all, we will be paying banks rates that are comparable to those that they can earn in the marketplace. so those payments don't involve subsidies to banks. and in addition remember that we have, in expanding or holding our provision of researches -- reserves, we've acquired longer term assets on the asset side of our balance sheet. and the spread of both what we've been paying in terms of interest on excess reserves is quite large. so although that will diminish over time as monetary policy is normalized, the expansion of our balance sheet, even though

we are even at present paying 25 basis points, interest on reserves week of had record transfers to the treasury, close to $100 billion this past year and $500 billion since 2009. so there have been large transfers associated with that policy. >> that situation is likely to reverse if we get into a normalization mode? >> it is likely that our transfers to, our remittances to the treasury will decline as short-term rates rise. we nevertheless expect the remittances to remain positive. >> thank you mr. chairman. >> thank you. >> i thank my colleague from

virginia. madam chair, thank you for your service. as you know, our economy continues to recover from the damage inflicted by the financial crisis and the grea recession that followed. g.d.p. is growing, employers are hiring. unemployment's falling. so it's only natural that some are starting to look ahead to a time when the federal reserve can start withdrawing the monetary stimulus that has been so critical to our recovery. but in my view we still face challenges. most americans are still waiting for the recovery to show up in meaningful income growth. long-term unemployment, while down is still high. inflation continues to run well below target. as it has now for an extended period of time. so from my perspective, it's critical that the fed not put the cart before the horse and tighten too soofpblet you've said on multiple occasions that the federal reserve's timetable for raising rates will depend

on the data. there are some who say the federal reserve should tighten preeveryonetively based on unemployment or wage growth or at the first hipt of inflation. -- hint of inflation. without waiting to find out if it's a statistical blip. what would be the risk if the fed raises rates too soon compared to the risk of waiting? >> well, if the fed were to raise rates too soon, senator, we would risk undermining a recovery that is really just taking hold. and is really succeeding, i think, in improving the labor market. as i said, i don't think we're back to attaining yet conditions i'd associate with maximum employment or normal labor market conditions. things have improved notably. but we're not there yet. and so we want to see a healthy

recovery continue. in addition, as you mentioned, inflation is running well below our 2% objective and while we think a significant reason for that is because of transitory factors, most importantly the decline we've seen in energy prices we are committed to our 2% objective. just as we don't want to overshoot 2% on the high side, we don't want to chronically undershoot 2% on the low side either. so before raising rates, we will want to feel confident that the recovery will continue and that inflation is moving up over time. there are also, of course, risks of waiting too long to remove accommodation. we have a highly accommodative policy that's been in place for some time.

we have to be forward-looking. as the labor market tightens wage growth and inflation can pick up to the point we would overshoot our inflation objective and conceivably there could be financial stability risks and we want to be attentive to those as well. so this is a balancing of costs and risks that we're trying to make in a deliberate and thoughtful fashion. >> i appreciate that. it's that balance that i hope your wisdom and those of your fellow board members can get just about right. because i could see entering and choking off recovery before middle class families actually feel its gains and trapping a too-low inflation or deflation set of circumstances. i appreciate that. let me ask one other question. i've heard several commentators say that the interest rate

increased by the fed would signal quote-unquote confidence to the market about the health of the u.s. economy. and have a stimulative effect. do you agree with that theory? if so, wouldn't any so-called confidence effect be more than offset potentially by an impact of a rate increase? >> i think it's fair to say that when we begin to raise our target for the federal funds rate, it won't be because -- it will be because we're confident about the recovery and we are reasonably confident that inflation will move back to our 2% objective over time. but that confidence will reside in real improvements that we see in the underlying condition of households and businesses where we would not be attempting to somehow bootstrap an improvement in the economy

that is purely occurring from a confidence effect that comes from our raising rates. there is reason, i think, to feel good about the economic outlook. households are -- have gone through major adjustments in their balance sheets and are in better financial condition than they were. the job situation is improving. an even though wages haven't been rising in real terms very rapidly, there are more hours of work and more jobs. so household income is improving. lower oil prices are boosting household income. housing prices have rebounded and that's helped a lot of households. and businesses are -- >> so in essence real confidence, not confidence that is spun. >> that's right. there's no spin here. our confidence in the economy has improved and when we raise rates, it won't be a signal in

our confidence in the underlying fundamentals. >> thank you mr. chairman. chairman yellen, good morning. thank you for being here this morning. i'd like to change the conversation a little bit and talk about the insurance industry and its impact on places like south carolina where we have about 354 -- $354 billion of life insurance in place. as we think through the transferring of risk that the insurance industry provides, i think it's a very important consideration. i'm a bit prejudice in this area. i've spent 25 years in the insurance industry. i appreciate the fact that until the insurance company shows up, the importance of how we impact the insurance industry to the fed i think will reverberate throughout the economy. i take very specific interest in the impact that the fed may have on regulating the insurance companies now that have been designated

systemically important by fsoc and my thought is that last year, i believe it was, the president signed a law that clarifies the fed need not impose bank-like capital standards on insurance companies under its supervision. this is for very obvious reason. you look at the activities of banks, loans and deposits compared to -- comparatively speaking to the long-term risk that most insurance companies are holding their assets for, it's important to have that delineation and take a very different approach to insurance companies than we do other financial institutions. i know from experience that this is an important consideration. i guess my question to you is, what expertise does the fed have or plan to acquire as it begins to supervise insurance companies and how closely are you working with state insurance regulators? >> my answer would be that we have acquired expertise we have hired individuals who have experience in the insurance industry and are trying to build our expertise there.

we consult closely with the neic and with state insurance regulators and the federal insurance office. we're gaining experience because we are now in our fourth annual supervision cycle of savings and loan, holding companies, many of which are -- some of which have significant insurance activities and of course we're -- several insurance companies have been designateded and we're supervising those as well. we are taking the time and doing the work that's necessary to understand their unique character statistics and -- characteristics and fully plan to tailor our supervision and capital and liquidity requirements for those insurance companies to make our supervisory regime appropriate. they're very important -- there

are very important differences between the risks faced by insurance companies and banking organizations. we have undertaken a quantitative impact study and are are actively engaged in working with the firms that we'll be supervising to understand the unique characteristics of their operations before promulgating supervision regime. >> thank you. you've answered my third question as well so i'll go through the second question at this point then. will the fed issue an advanced notice of proposed rulemaking before issuing proposed rules on insurance capital standards then? >> yes. we will issue proposed rules. we recently issued a proposed rule that pertains to our supervision of g.e. capital and we would do the same with the other firms. >> thank you.

on the issue of stress testing, i know the fed is, through the supervision of bank holding companies and other bank nonfinancial companies, the fed constructs stress tests to determine how well the entity could with stand different levels of financial distress. the fed currently has on its balance sheet about $4.5 trillion as a result of the q.e. program. much larger, of course than any of the financial entities it regulates. but it appears that nobody is stress testing with that. the proverbial fox is guarding the hen house, in my perspective. my question really is as you begin to unwind the fed's massive balance sheet, hopefully in the near future what assurances can you give this committee that the fed will stress test its own q.e. exit plan? >> with respect to our balance sheet, let me say that we do stress test it and we have issued some reports and papers

where we describe what stress tests would look like when there are interest rate shocks, how that would affect our -- affect our balance sheet. but it really is important to recognize that the federal reserve is not identical to an ordinary banking organization. first of all capital plays a very different role in the central bank than it does for a banking organization. congress and the rules put in place regarding our capital were never intended to make our capital play the same role and it's not necessary for it to play the same role as a banking organization. importantly, unlike a bank, the federal reserve's liabilities are mainly reserves to the banking system and currency. and these are not like the runble deposits of an ordinary

banking organization. so the risks that the federal reserve faces in our balance sheet are of a different character than those facing an ordinary bank. but that said, we do look at the likely consequences for our balance sheet of different interest rates scenarios. >> certainly very different scenarios between the fed and the banks, without any question. but $4.5 trillion and the way that you wind it down would reverberate throughout the economy in a way that no other financial organization would have impacted. the path forward is incredibly important to the economy. >> that's one reason that one of the principles of our normalization plans is that we want to wind down our balance sheet in an orderly gradual and predictable way. and we've decided to use as our

main tool of policy when the time comes for normalization something that is much more familiar both to us and to markets and that is variations in short-term interest rates. of course an alternative to that would be to say when the time comes to want to tighten monetary policy, we could begin to sell assets. that would be another way of going about doing business. but we have more experience and markets have much more experience with variations in short-term rates and we want to proceed in that way that's familiar to us familiar to market participants and the public and to let our balance sheet play a passive role, to gradually diminish in size mainly through ending reinvestment of matures

principle. >> thank you. -- principal. >> thank you. >> thank you, chairman yellen, you're coming down to the home stretch here. appreciate all your good work and this incredibly important balance to get right as we start down a path of unwinding. but i, like many of my colleagues, share with, inflation is such a low rate, trying to get this timing right is so critically important. one of the things, we've talked a lot about the status of the u.s. economy, but i want to raise three quick points. one after the january fomc meetings in your readouts, one of the items you mentioned were international developments. obviously disruption, potential in europe with the ongoing struggles with greece. china's slowing economy. can you rank or how will these

international developments affect the fed's decision on timing on monetary policy? >> there are a broad range of international developments that we monitor and they do affect the performance the likely ferre for mans of the u.s. economy -- performance of the u.s. economy and factor both into our economic forecasts and our assessment of risks. growth in europe has been very slow. growth in china is slowing. the huge decline we've seen in oil prices has had repercussions all over the globe. in some areas, very positive. in other areas negative. it affects our outlook these developments both through trade flows and through developments in financial markets. the attempts of many central banks to add monetary policy

accommodation is pushing down longer run interest rates in many parts of the world and that's as i mentioned in my testimony, spilling over to the united states. so there are many channels through which these global developments affect the u.s. outlook in both ways positive and negative. all in all, so, factoring all of those things into account, while there are risks, again, both positive and negative, stemming from the global developments we still think that the risks for the u.s. outlook are nearly balanced. that we've got sufficiently strong growth in domestic demand and in domestic spending by consumers and businesses, that the recovery looks to be on solid ground. we've just as i mentioned in my testimony, had a very strong

growth in the second half of the year. and looking forward and analyzing the factors likely to impact domestic spending we're seeing perhaps not so -- not as strong as we just had, but nevertheless above trend growth. and that really factors into account all of the global consideration -- >> obviously international factors will affect your decision? >> they do affect our decision. >> i also want to associate my comments with senator corker's comments about -- i'd like to make sure we deal in a perfect world with currency manipulation, but currency manipulation to one could appear as monetary policy to another. as we've seen japan and europe move towards mormontary easing, obviously one of the effects of that has been strength in the dollar and hurts our exports. speak to that for a moment, if you could, and let me get the last 30 seconds at the end. >> you bet.

i think we should be on guard to -- against currency manipulation. the g-7 and international fora have agreed and i know our administration, in dealing with foreign countries, really tries to crack down on currency manipulation. nevertheless i think certainly it's a principle of agreed in the g-7 that monetary policy oriented toward domestic goals like price stability or, in our case price stability in maximum employment this is very valid use of a domestic tool for a domestic purpose. it is true that the use of that tool can have repercussions on exchange rates. but i really think it's not right to call that currency manipulation and to put it in the same bucket as interventions in the exchange

markets that are really geared toward changing the competitive landscape to the advantage of a country. >> mr. chairman, i would just, with my last couple of seconds, want to make the point that one of the things that has been absent from this discussion today has been -- we've talked a lot about your work, we haven't talked as much about our work and need to still address our own fiscal policies. i would simply point out that because of the extraordinary remittances from the fed's expanded balance sheet, we've seen north of $420 billion in net additional revenue that has diminished our deficit. but that is not something that can be projected onto in the future. and as we talk about the times of raising interest rates and trying to get back to normalized effort, i would simply point out again, you know 100 basis point increase in interest rates adds $120 billion a year on debt service.

and even c.b.o. projections at this point will show that debt service, with our current $18 trillion in debt, will exceed total defense spending or total domestic discretionary spending in 10 years. and that is not a good business plan for our country. >> absolutely true. >> thank you mr. chairman. >> thank you, mr. chairman. thank you for being here, chair yellen. as you know, wall street banks could profit handsomely if they knew about the fed's plans before the rest of the market found out. and that's why any leak of confidential information from the fed results in serious penalties for the people who are responsible. but apparently there have been no consequences for the most recent leak. according to public reports, scott alvarez, the general counsel of the fed, was puts in charge of investigating a leak from the september meeting. nearly 2 1/2 years later the

results of this investigation have not been made public. and no action has been taken. on february 5, congressman cummings and i sent a letter to mr. alvarez requesting a briefing from him in advance of your appearance here today. but so far we have not received one. can you assure us that the congressman and i will get a briefing soon? >> i might say by way of background -- >> i just need a yes or no. i want to be -- [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit ncicap.org] [captions copyright national cable satellite corp. 2015] >> we'll leave this now as the house gavels in. h.r. 212 by the yeas and nays, h.r. 734 by the yeas and nays. the first electronic vote will be conducted as a 15-minute vote. remaining votes will be conducted as five-minute votes. the unfinished business is the vote on the the gentleman from

ohio and the yeas and nays are ordered. the clerk: h.r. 212 a bill to amend the safe water drinking act and for other purposes. the speaker pro tempore: the question is will the house suspend the rules and pass the bill as amended. members will record their votes by electronic device. this is a 15-minute vote. [captioning made possible by the national captioning institute, inc., in cooperation with the united states house of representiv. any use t csecaiod ve t hse proceedis lior comrcl rp ies prohid t u. us reprenti

the speaker pro tempore: on this vote the yeas are 375, the nays are 37. 2/3 of those voting having responded in the affirmative, the rules are suspended, the bill is passed and without objection, the motion to reconsider is laid on the table. without objection, the title is amended. the unfinished business is the vote on the motion of the gentleman from oregon, mr. walden, to suspend the rules and pass h.r. 734 on which the yeas and nays are ordered. the clerk will report the title of the bill. the clerk: union calendar number 19. h.r. 734. a bill to amend the

communications act of 1974 to consolidate the reporting obligations of the federal communications commission in order to improve congressional oversight and reduce recording burden. the speaker pro tempore: the question is will the house suspend the rules and pass the bill. members will record their votes by electronic device. this is a five-minute vote. [captioning made possible by the national captioning institute, inc., in cooperation with the united states house of representave any use of edon coveragef e u proceedis lior comrcl es exprslpribedy susofepseates

the speaker pro tempore: on this vote -- the speaker pro tempore: on this vote, the yeas are 411, the nays are zero. 2/3 being in the affirmative, the rules are suspended, the bill is passed, without objection the motion to reconsider is laid on the table.

for what purpose does the gentleman from georgia seek recognition? >> i send to the desk a prive lemmed report from the committee on rules for filing under the rule. the speaker pro tempore: the clerk will report the title. the clerk: report to accompany house resolution 121, house resolution providing for consideration of the bill h.r. 529 to amend the internal revenue code of 1986, providing for the consideration of the bill h.r. 5, support state and local accountability for public education, protect state and local authority, inform parents of the performance of their childrens' schools and for other purposes. and for other purposes. the speaker pro tempore: referred to the house calendar and ordered printed.

the chair will now entertain requests for one-minute speeches. for what purpose does the gentleman from pennsylvania seek recognition? >> mr. speaker, i ask unanimous consent to address the house and revise and extend my remarks. the speaker pro tempore: without objection, the gentleman is recognized for one minute. if i can ask everyone in the chamber -- everyone in the chamber please take your conversations outside.

the gentleman from pennsylvania is recognized. mr. thompson: thank you, mr. speaker. mr. speaker, over the weekend, penn state university held its annual pan he will ening -- hellenic dance. known as fawn. it's a year-long effort to raise funds and awareness for the fight against pediatric cancer. since 1977, they've raised more than $127 million for the four diamonds fund based out of penn state-hurst u. medical center. with support from students across the commonwealth of pennsylvania and supporters around the world this year's event raised over $13 million. mr. speaker, as a graduate of penn state university i cannot be more proud of these students and future fellow alumni and i congratulate them on yet another spectacular year. thank you mr. speaker, and i yield back the balance of my time. the speaker pro tempore: the gentleman yields back his time.

for what purpose does the gentleman from new york seek recognition? >> i ask unanimous consent to address the house for one minute. the speaker pro tempore: without objection the gentleman is recognized for one minute. >> thank you, mr. speaker. mr. tonko: i rise to recognize the importance of stem education and training for our future engineers. it has been projected that our nation will need almost two million engineers by 2018 and that some fields in engineers will experience a 30% to 70% growth during that time frame. despite these critical work forest needs, a vast majority of schools do not offer k through 12 education that creates clear pathway into careers in engineering and stem-related fields this week i visited tech valley high school in albany, new york in the 20th district. to highlight this need and celebrate the good work being done in my congressional district to close the skills gap we see in this very vital

discipline. the nation that -- the nations that lend the -- that will lead the global economy of the future will be those that invest in the education of their next generation, particularly in engineering. i urge my colleagues to recognize this need and work in their own communities to bolster engineering education nationwide and allow our nation to become the kingpin of the future international autonomy. let's grow and cultivate those engineers. with that, i yield back. the speaker pro tempore: the gentleman yields back. for what purpose does the gentleman from texas seek recognition? >> mr. speaker, i ask unanimous consent to address the house for one minute and revise and extend my remarks. the speaker pro tempore: without objection, the gentleman veck is -- the gentleman is recognized for one minute. mr. poe: mr. speaker he was only 37 years of age, a father, husband community leader. he was houston's fire captain,

dwight bazzill. known as b.b. to his fellow firefighters. he was helping put out a fire at a duplex when he suffered cardiac arrest he collapsed in the street and was rushed to the hospital, where he died. he was doing his job. he was saving others when his life was taken. b.b. was described as having a gentle and caring personality. mr. speaker, firefighters are a special breed. they run into the flames that everyone else is trying to escape from. they work to restore order from chaos. that is why we call them first responders, because they are the first to help the people. firefighters are courageous and tenacious breed. they are uniquely american. mr. speaker, it's been said that all people are created equal, but few become firefighters. captain b.b. was one of those people. we remember captain bazzill and

pray for his family. he was one of houston's finest. he died on duty, the duty of protecting and serving the people of houston, texas. he was quite a man, mr. speaker. and that's just the way it is. the speaker pro tempore: the gentleman yields back. for what purpose does the gentleman from texas seek recognition? >> to address the house for one minute and revise and extend my remarks. the speaker pro tempore: without objection, the gentleman is recognized for one minute. >> mr. speaker, i rise today as parking lot of the growing chorus of americans -- as part of the growing chorus of americans calling for republicans to stop playing with the safety of the american people and fully fund the department of homeland security. mr. castro: a select few are holding our government hostage. not only was this -- would this bad strategy force more than 40,000 border patrol agents out of work but also 40,000 active

duty coast guard and military members more than 50,000 t.s.a. aviation security screeners, it would cause all tease folks either out of work or work without pay indefinitely. in my home state of texas, there are more than 24,000 homeland security employees who could face similar impacts. if republicans want to prove they can lead congress, they shouldn't manufacture a bogus crisis, they should fund the agency responsible for protecting our agency at once. the american people deserve better than these unnecessary political games. i yield back. the speaker pro tempore: the gentleman the speaker pro tempore: for what purpose does the gentlewoman from florida seek recognition? ms. ros-lehtinen: to address the house for one minute, revise and extend my remarks. the speaker pro tempore: without objection, the gentlewoman is recognized for one minute. ms. ros-lehtinen: mr. speaker, today we commemorate the murder by the cuban regime of three u.s. citizens and one u.s. resident, carlos costa, armando

alejandro and pablo morales. 19 years ago today, the castro brothers ordered the shootdown of the civilian brothers to the rescue planes and blew them out of the sky over international air space during an unarmed humanitarian mission. these volunteers were devoted to search the florida straits to aid those who risked their lives on rafts to flee the oppressive yoke of the castro regime that continues to rule over the island. it's shameful that this same regime that is responsible for killing these innocent heroes is now sitting across the table from u.s. government officials and will be hosted by their own department of state later this week. not a proud week for strong american values, mr. speaker. i yield back. the speaker pro tempore: job. -- the gentlewoman yields back the balance of her time. for what purpose does the gentlewoman from texas seek recognition? jackson scrax jackson to address the house for -- ms. jackson lee: to address the house for one minute, revise and extend my remarks. the speaker pro tempore: without objection, the gentlewoman is recognized for

one minute. ms. jackson lee: thank you very much mr. speaker. i rise to absolute a gentle giant -- salute a gentle giant. the name of captain brazil. a hero, a man who died in the line of fire, and a man who many of us got to know and love . he started in the houston fire department at the age of 19 and he was called baby boy. that ultimately became b.b. but everyone who came in the distance of his heart and mind said that captain brazil was a mentor who taught men and women who were incoming firefighters. this past weekend i flew into houston, was able to go to his bedside on saturday. to be able to see his family and his wonderful son who he loves with deep and abiding love. a wife who loved him without question. all of his fire brothers and sisters were all around. they had the opportunity to pray. and then unfortunately, he

lost his life. he died in the line of duty. on saturday night into early morning of sunday, i joined a throng of firefighters to proceed in the procession to take his body from the memorial hospital, herman memorial to the medical examiner's. mr. speaker, let me simply say, as we roll through those streets, through the enableds that he fought for and fought fires, saved lives and passed fire station 46 and all of his brothers and sisters, i felt a sense that his spirit had lifted up and that we had honored him by his travel and his journey, that we will continue to honor him baby boy b.b., father, husband, great leader hero, captain, firefighter, who died in the line of duty. i yield back. the speaker pro tempore: the gentlewoman yields back the balance of her time. for what purpose does the gentleman from minnesota seek recognition? without objection, the gentleman is recognized for one

minute. mr. paulsen: mr. speaker, it's a question that families all across the country are asking themselves. how can we afford to send our children to college? the president's plan to tax 529 colonel savings plans would have punished people who are saving for their children's higher education. instead of pun i,ing families who are diligently saving for their children's education, we should rewa tm,ivt more aid ul strengenndmpvehe pl 529 lle vis anara rluless f millions of families to w.h.o. put aside money to help ensure that their children or their child will not be burdened with mountains of debt after they graduate from college. this weekley be supporting legislation -- this weekley be supporting legislation that expand and will modernize 529 savings of college savings accounts so more families have the opportunity to send their children to the higher education institution of their choice. i yield back. >> the gentleman yields back the balance of his time. for what purpose does the gentleman from pennsylvania seek recognition?

without objection, the gentleman is recognized for one minute. >> thank you, mr. speaker. 70 years ago yesterday american armed forces fought their way to the summit of the mount and raise the the american flag on i with a gyma -- iwo jima. sergeant michael strength was one of the six men in this iconic photo who helped raise the flag. the sergeant was part of the great estrogen ration. a generation that rolled back a dark totalitarian tide that broke upon the world in the first half of the 20th century. mr. rothfus: the battle for iwo jima was hard-fought and is of great significance for the united states marine corps. more than 6,800 service men died in the battle, including the sergeant who was killed just five days after the flag was raised. this unforgettable photo captured the unfailing heroism

and determination of those who fought. it reminds us that freedom is not free. that it has been hard-won and that some, like the sergeant, made the ultimate sacrifice to protect it. i had the privilege to meet members of the sergeant's family this weekend, including his sister. let us always thank our veterans who served and their families who gave us such heroes. i thank the speaker and i yield back. the speaker pro tempore: the gentleman yields back the balance of his time. for what purpose does the gentleman from kentucky seek recognition? >> i ask for unanimous consent to address the house for one minute, revise and extend my remarks. the speaker pro tempore: without objection, the gentleman is recognized for one minute. >> mr. speaker, i rise today to recognize a world war ii icon. u.s. marine private first class franklin r. sously of fleming county, kentucky. mr. barr: a graduate of fleming county high school, he chose to enlist in the marine corps

where he was assigned to company e second battalion as a rifleman. he landed on iwo jima on february 19, 1945. during the intense fighting, american forces secured the mount. shortly thereafter, sously raised a large u.s. flag, so it could be seen over the island. an iconic offense taken during this raising -- photo graph taken during this raising led to an immortalized symbol. sadly, soon after this photo -- photograph was taken he was killed in combat by a japanese sniper. his remains were laid to rest in a cemetery in fleming county, kentucky, in my district. the private first class paid the ultimate sacrifice defending freedom for generations. however his memory lives on in the timeless photograph, in the

image depicted in this memorial, and through the gratitude of all americans. mr. speaker, i yield back the balance of my time. the speaker pro tempore: the gentleman yields back the balance of his time. the chair lays before the house the following personal requests. the clerk: leave of absence requests for mr. danny davis of illinois for today. and mr. hinojosa of texas for february 24 to march 6. the speaker pro tempore: without objection, the requests are granted. under the speaker's announced policy of january 6, 2015, the gentleman from california, mr. garamendi, is recognized for 60 minutes as the designee of the minority leader. mr. garamendi: mr. speaker, thank you.

about a month and a half ago, we heard the president speak to us about the economy, about his goals for america. and he labeled his speech, middle class economics. and tonight i want to pick this issue up once again. we are here most every week discussing this issue. although last time we were up here we took up another important issue alts. but i want to come back -- alzheimer's. but i want to come back mid tole class economics, why it's important. it's important because it drives our economy. the great majority of americans want to be in the middle class and most of them are. unfortunately we've seen the decline of the middle class. their ability to own a home, a car, to provide for their family. but if the middle class is healthy it will drive our economy and it will create jobs. and so the focus on the middle class becomes very, very important. we can do this by strengthening

their wages, if they're able to earn more money then they'll buy the home, the car and the economy will grow and other people will be able to enjoy the fruits of our economy. i'm going to focus on infrastructure in a moment. but i just want to skip that over and go down to the other things. health care. who among us doesn't want to have a good health care program so that if we get sick or injured we'll be able to get to a doctor, get to a hospital, get the care we need to get back on our feet and once again be productive? or in our old age, be able to enjoy our retirement. so the affordable care act becomes really important and here we have the affordable care act as part of that. finally, we need to develop a policy to grow the middle class. and one such policy is infrastructure. which is the focus of tonight's discussion. so i want to just stay with this infrastructure issue for a few moments and then i'm going to invite my colleague from minnesota to join us here.

let me talk about this also. the other theme, in addition to the middle class economics, is the make it in america theme that we've been talking about for four years now. trade, taxes energy, labor, education research, and infrastructure. these are the elements that we fold into our make it in america agenda. so we talk about trade, there's going to be a lot of discussion about that here in congress over the next several months. as the trans-pacific partnership comes up. taxes, which will pick up with the infrastructure issue in a few moments. energy is also part of the infrastructure issue. so anyway, the make it in america means bringing the jobs back home. employeing americans -- employing americans, doing the things we need to do in this country, whether it's the health care sector, the infrastructure, building the roads, the bridges and the like. or education.

so that's the make it in america agenda. it's part of the middle class economics. in fact it is a key to it. so why is infrastructure important? well there are had certain things like this. a collapsed bridge. this is on interstate 5 in the state of washington. this is a bridge near the canadian border. and about three years ago it went -- boop -- into the river, collapsed. one of about 163,000 deficient bridges here in the united states. so, yep, if we're going to be able to address this problem we better. actually it's 156,000. i was a little bit overanxious there. the american society of civil engineers who build these things have rated the american

infrastructure. i just want to go through it. aviation, our airports, which i believe the vice president in referring to laguardia said even the developing countries have better airports than laguardia in new york city. aviation, a d. bridges, c-plus. as i said, 156,000 deficient. dams, d. running water, d. energy d-plus. hazardous waste, d. inland waterways, d. levees to protect us from floods, d. our ports, c. public parks and recreation c-minus. our railroads c-plus. whoa. a c-plus. our highways, a d. our schools, it's where our crids -- kids are, d.

solid waste, doing pretty well, that's a b. our transit systems, d. wastewater, d. incidentally in california, we're in the midst of a major drought. and it's perfectly clear that the wastewater systems are inadequate and if we were to also fund the recycling programs which could be connected to the wastewater we could in southern california, over the next half decade create a million acre feet of new water as we recycle the water from the fifth biggest river on the west coast of the western hemisphere. the sanitation plants in southern california. so we've got some work out ahead of us. let me bring this home before i invite my colleague from the great state of minnesota to join us on this issue. earlier today i was reading an article in "the sacramento bee" about the transportation systems in sacramento. let me just share some of these

thoughts with you. in sacramento the average commuter spends 32 hours each year stuck in traffic. this amounts to $669 of lost productivity. that's literally wages that could have been earned if they weren't stuck in traffic. for all of the commuters in the sacramento area which i represent, that's $834 million of commuting time. for the truckers in the area that are trying to pass through sacramento on interstate 5 on interstate 80 or highway 50, it's $199 million of lost productivity. there's another alternative. down in riverside, a southern california city, that i once represented when i was lieutenant governor, they want to build a 13-mile street car system. in the city of riverside. it will cost about $300 million. .

the economic analysis done on that showed that if they were to do it they'd get a four to one return on investment. tell me what investment banker in wall street wouldn't want a 4-1 return on their investment? the city of riverside could have a four to one return on their investment of $13 million to build that system. this morning "the wall street journal" published an article by the american society of -- published an article in which the american society of civil engineers were quoted that between 2012 and 2022 in america because of the insufficient infrastructure, and remember, i just read you their g.p.a., mostly d's, lost sales. $1 trillion of lost sales.

for the united states the delays will cost $3.1 trillion. and to bring it home to a single company, big company, but nonetheless just one company united parcel service, u.p.s., all those big brown trucks that are out there, $105 million in lost revenue. now, there's a solution. the president has put forward to us, the members of congress a six-year $478 billion transportation plan that will be paid for fully paid for, with the current gasoline and diesel tax not increased, keep it the same, and going out to those american corporations that are stiffing the american taxpayer by hiding their profits overseas. the president said bring those profits home, pay your fair share of the taxes. so there's a fully paid for

proposal before us here in the house of representatives for $478 billion, six-year transportation program. now i think our speaker represents an area in ohio, near kentucky, and i believe there's a bridge in that area called the breath-spence bridge, crosses the ohio river between kentucky and ohio. it was built for 80,000 cars a day and now there are over 200,000 cars a day that pass over that bridge, or try to pass over that bridge, creating a monumental traffic jam and slowing down the entire economy. and don't walk or drive underneath the bridge because the concrete in the bridge is falling off and they have a nice little safety net over the road beneath it and perhaps therefore you won't be hit by falling piece of concrete.

so the issue for us representatives of the american public is, are we willing to put together a full transportation program so that these kind of bridge collapses are pictures of yesterday, not the pictures of tomorrow's future? i'd like to have mr. nolan join us now. take one of the microphones or only on town here. would you like to speak from the floor? you can take the right side. now, mr. nolan, off fascinating history here in the house of representatives. you were here in the early 1970's as a representative. then decided to go back to minnesota and build a business a lumber manufacturing, timber

manufacturing business, very successful. then you came back to straighten us out, bringing all that history to us. welcome, mr. nolan. thank you so much for joining thus evening as we talk about transportation in america. and infrastructure. >> thank you. the house historian tells me that my 32-year hiatus is the longest in the history of the house of representatives. mr. garamendi: an opportunity to learn about the private sector and learn about the necessity for transportation. i think your business was dependent on that, both to get the materials to your lumber mill and to export it. mr. nolan: very much so. i also built an export trading company and did a little business all over the globe. people asked me what i sold, i like to tell them i sold just about everything except guns and drugs which is where all the real money was. it was an eye-opening experience to see how the rest of the world does business, get

a feel or understanding for the importance of agriculture. and better feel and understanding agriculture as it relates to feeding a hungry world. but infrastructure and its importance it's a building middle class here in the country to laying the foundation for job growth, economic growth, and to come back here again after those years in business and in community service i've got to be brank if with you, i feel much better prepared today than i ever was to serve my district and to serve my nation and i'm grateful to have the opportunity to be here. i want to particularly thank you for calling this to the attention of the american public. the importance of infrastructure, the importance of infrastructure to the middle class in this country and the

importance that it brings to, you know, the fulfillment of the american dream. the american dream is not everybody becoming a billionaire or pulitzer prize winner. it's about contributing. it's about having a good job. it's about having a living wage. it's about having some money left over at the end of the week to take your family or your best friend and go out and have dinner or maybe wet a line and go fishing. and quite frankly, you know, that's what's getting away from us. i want to thank you for bringing to the attention of people how a transportation and -- how transportation and infrastructure and its degradation that's taking place is related to, quite frankly, the demise and deline of the -- dec othmilela i this cnt epltrh infraruurand heic e getting richer. the poor are getting poorer and the middle class is getting

crushed and simultaneously our infrastructure is falling apart. so the gentleman from california, mr. garamendi, you, too, have a background in business and public service and community service. that gives you a good grasp and understanding for the importance of all this. mr. garamendi: there's no doubt about the importance of it. if you want to build good middle class jobs a lot of those jobs are in the infrastructure. it may be a hard hat job out there putting the steel and the -- with the concrete, the ironworkers or cement mason orse operators of the heavy equipment. all those are real question good, middle class jobs no doubt about it. wherever they happen to be across the nation. but also in the back office. somebody has to do the accounting. somebody has to do the design work, the architects, the draftsmen and women that are

involved. so these jobs permeate the entire economy and it's absolutely true that if we can fund that is pass, a six-year robust transportation bill that's fully paid for americans will go to work in middle class jobs. that's the first effect. people will have jobs. and in building the infrastructure, you lay the foundation for future economic growth. you've seen this in your area. i was thinking about your call for the family to be able to enjoy the fruits of life and thinking about you've got some heavy duty hunting country up in your area. you're out in the back woods of minnesota if i recall. mr. nolan: i am. my nearest neighbor is a couple miles away. mr. garamendi: and in between are bear and el -- not elk but deer. mr. nolan: we have grouse, we

have good hunting and darn good fishing too. so you know you mentioned the fact that i had served many years ago, quite frankly, back in the 1970's i like to tell people i was only 10 years old at the timism told -- when i first got back here, i said to a number of people, perhaps you knew my father when he served here back in the 1970's, and there was always a couple of old-timers in the back that would left and everyone would say what's so funny about that. and they'd say, it wasn't his father it was him. but i've got to tell you it was quite different, it was quite different than it is today. i had my staff do a little survey and we found that in the terms i served before, there was an average of about 8,000 subcommittee, full committee, and conference committee meetings here in the congress. and what it meant was is that

we got together five days a week. in our committees. and you know, all the diverse elements that make up america, we're all -- were all represented and in those meetings. that's how we found common ground. that's how we came together. that's how we fixed things. that's how we got things done. and the people have to be reminded, i think, that process is important to good government. because now we're faced with this gridlock, we're faced with this terrible partisanship this seeming inability to be productive and to get things done. i think experts that study governance here in america are saying now that this immediate last congress was the most unproductive in the history of the country. well, guess what. when we had 8,000 committee meetings in the past somewhere

maybe around 1,000 of them were just formal hearings or you know, you've got to give jack nicklaus a gold medal and authorize -- re-authorization of peanut butter and jelly week. this last session of congress we had about a thousand of those meetings. most of them were quite informal. and as you recall, mr. garamendi, when we started the hearings about a year ago, in the transportation committee because we knew that the transportation legislation needed to be re-authorized, we had everybody come in before that committee and boy, we were laying the foundation for a good re-authorization of a transportation and infrastructure bill. and you were there every day, and -- by the way, i want to commend you for the leadership you have shown on that committee and in so many area,

so many ways, but we had everybody, from the head of the national chamber of commerce to the heads of all the labor unions, the truckers, the -- everybody came before that committee. and i don't know if you recall, i asked every one of them, i said, three questions, i remember the committee groaning saying, jeeze, you only got five minutes, how are you going to do that. i said, question number one is there anyone here on this committee who disagrees with the notion that our infrastructure is badly in need of repair and is falling down and dilapidated? nobody disagreed. second question. is there anybody here that of all that group, those testifying, that disagrees with the notion that our ability to grow an economy and create good jobs is dependent upon a good, strong infrastructure?

nobody disagreed, as you recall. then lastly, i said is there anybody on this committee who doubts that we need to find some new revenue? to rebuild our infrastructure and nobody disagreed. i said, make a note of it, mr. chairman, we've got to write a bill here. and that's what we were there for. and you know, as well as everybody else, that the authorization for the transportation committee to write a bill was pulled away from the committee. it was decided presumably, in the speaker's office or someplace else and it was decided that we should do a temporary re-authorization for eight months. as you recall, we borrowed money from people's private pension funds. so we're getting near that eight-month deadline again. mr. garamendi: i think it's may 15. mr. nolan: yeah, may 15.

so now, people's pension funds are short of a little money, potentially and we still haven't fixed the transportation problem system of one of the things i want to do here tonight, and i know you do as well, is to call upon the speaker to let the committee do its work. we've got a good committee. and you know it as well as i do and everybody else, there's a lot of good will in this chamber among democrats and republicans and conservatives and liberals and if we're allowed to sit down in that committee and advance our ideas and argue the merits of them, we'll find that common ground. we'll find a way to get this country back on track with rebuilding our infrastructure. and and that's what democracy is all about. someone said to me here the other day, it almost broke my heart when i was explaining this, they said, isn't it more efficient here by not using the committees? i said yeah, of course it is.

the nazis and the communists would love it. democracy is a lot of hard work. and there's so much goodwill in this chamber. there's so many good men and women. we get along type of. you know, mr. speaker, let the process work. let the committee do its job. and we'll get a good transportation bill. and we'll rebuild this middle class and rebuild our economy. in a way that's fair to everyone. mr. garamendi: there's no doubt that if we were to pass well, we don't have a choice. if we don't pass a bill in the next two months, 2 1/2 months, all public works transportation programs will come to a screeching halt. there will be had no more federal money and it will simply stop. we have work to do. as you say, if the committee could have its way, we could put together a good bill. it's been a long history here of the transportation bill being a bipartisan bill. and we can do that. if we don't, let me just go back through this.

sometimes -- i don't know. i get stacks and stacks of paper. and this one caught my eye. it's infrastructure investment creates american jobs. that's kind of a pretty good cover there. it's got roads and bridges and ports and so forth. and it's the duke center on globalization, governance and competitiveness. so it's the duke university. and here they say, old and broken transportation infrastructure makes the united states less competitive than 15 of our major trading partners and makes manufacturing less efficient in getting goods to market. underinvestment in infrastructure costs the united states over 900,000 jobs including more than 97,000 american manufacturing jobs. maximizing american-made materials when rebuilding infrastructure has the potential to create even more

jobs. relying on american-made inputs can also mitigate safety concerns related to large-scale outsourcing. i'm with you, duke. duke university you know, i'm from the west coast. i got problems with some of these east coast athletic teams. but, hey, i'm with them on this one. infrastructure creates american jobs. and this is something that i've used over and over again. this is from mark zandi, chief economist at moody analytics. he's a former economics advisor for senator john mccain when the senator ran for the united states presidency. and he put it this way. for every $1 invested in infrastructure investment $1.57 is pumped back into the american economy. with well paying middle class american jobs. this is just really critically important. the question for us, and the reason we're here on the floor and the reason we're talking about this issue of middle

class economics and now transportation is that we're up against a timeline here. we've got the transportation cliff. we've got a bridge that is collapsed and the question is will this congress provide a transportation bill that can bridge this collapsed bridge? and rebuild it? i think we can. i know we must. my fear, my fear mr. nolan, is that we have become really really good at something we used to play when i was a kid and it's called kick the can. we've become really good at kicking the can down the road, rather than just coming to grips with the reality that we have to have a long-term transportation bill. many reasons for it. these are long-term projects. and over the last i guess almost seven years now we have not had a long-term bill.

the longest one has been a two-year bill that passed two years ago. and that doesn't give the planners enough time to plan these long-term projects or the assurance that the money, the federal money will be there. $478 billion, six years, fully paid for, doesn't increase the gasoline or diesel tax, but requires american corporations that have run away from their obligation to this nation by hiding their profits overseas by bringing those profits back and taxing them accordingly. that's the president's plan. and it's all there for us. can we do it? i don't think we have any choice. i think we have to do it, mr. nolan. i don't know how you feel about it from minnesota, but i know in california that we're in the midst of a major drought. and this is going to be the fourth year of a major drought in california. and it has been at least 30

years since there's been any major water infrastructure investments in california. and our economy in california is paying dearl for it -- dearly for it. about 1/3 of the rice fields in my district are falow. you go further south into the -- fallow. you go further south and it's probably the same percentage. cotton, other kinds of -- tomatoes, they're not being planted. we have to have, in california investments in our water infrastructure. and one of the things that my republican colleague and, mr. nolan, you spoke about bipartisanship, my republican colleague from my area mr. lamalfa he and i are going to introduce tomorrow a piece of legislation to build a very large offstream reservoir. it's about 1.9 million acre

feet of water. if that had been built a decade ago, the drought would still be very difficult. and there'd be a lot of trouble and a lot of lost opportunity. but at least we would have a very significant amount of water available, stored in that reservoir, to help us along. so we're going to do that. that's a major infrastructure program. and we'll see. we'll see if we can participate here at the federal level with the participation of the state of california. voters have approved a $7.6 billion bond act in which there is money for storage. both ock which ferre, underground -- aquifer, underground, as well as surface storage probably including the reservoir. so there are things we can do. an this is a piece of legislation -- and this is a piece of legislation, we'll present it to the congress and the senate and hopefully it will move along. i'm sure you've got projects up in your area that are important and perhaps you'd like to pick

up here. mr. nolan: i sure do. i think the fact that our bridges are falling down, i could not be more -- down, could not be more evidence in california where we had the catastrophic collapse of the i-35 bridge which killed a number of people and did obviously irreparble daniel to their lives -- irreparable damage to their lives and many others. mr. garamendi: this is the bridge across the mississippi? mr. nolan: yeah. mr. garamendi: minneapolis? mr. nolan: yeah. just tragic. i've got several thousand had bridges in my district alone and several hundred of them are -- have been certified as obsolete and in disrepair, in need of repair. of course there are thousands and thousands of those bridges across the country. i held three transportation hearings back in minnesota here recently. unanimity of agreement on what

needs to be done is really quite unique. generally you get 50 people in a room in minnesota and you have at least 40, 45 opinions. mr. garamendi: in california you'd have 150 opinions if you had 50 people. mr. nolan: everybody agreed, as you pointed out, we need a long-term plan. so that you can plan accordingly and then do it responsibly, in the most efficient and economical way. everyone came up and said we needed for our economic growth and our business and they understand that, as you were pointing out earlier, good infrastructure is the foundation, it's the foundation for every single successful economy in this world. and i've said to people on occasion, you know, if you don't want to pay any taxes, you can move to zaire. i think they have about two miles of roads and no taxes.

but you better bring a little army with you to protect you. the other thing of course, you know has become real apparent, the congestion. you must see that. we're seeing it in minnesota. i mean, people are spending endless hours sitting in their cars, trying to get to and from work. time that they could have used to sleep in an extra hour, get home in time for dinner with their family. there's a personal expense. you mentioned the collapse of the bridge. the other thing, they bant to see some bipartisanship -- want to see some bipartisan. i'd like to remind our colleagues, as well as the folks back home, because you and i were there when we were part of a couple of the few instances where, in the last session of the congress, the process was allowed to work. it was cumbersome, it was contentious. but at the end of the day we

came together and we passed a good bipartisan farm bill. you and i were part of that as well as our colleagues here on both sides of the aisle. and we were allowed on the water resources bill. and we were able to put together a good bill not everybody got everything they wanted. but everybody was a part of it. they had a chance to advance their ideas. we had open rules. if you had an amendment or good idea, you got a chance to advance it and get a vote on it. and people want to see more of that as well. and then there's one thing that doesn't get mentioned very often. and i don't mind bringing it up. a number of my folks back home brought it up. an that is, you mentioned, you know, the cost of nothing doing -- of not doing anything. that would be devastating for america. just devastating for our economy. i pray to god that would never happen. but our hope is, of course, it will be done in a responsible

way. that solves the problems and fixes these things. but there's a little factor. i had about a five-mile dirt road to my farm and i went through two front ends on my new pickup truck until it became part of a local effort to peave the roads -- pave the roads. my rod got paved and that was 10 years -- my road got paved and that was 10 years ago and i'm still driving the same pickup truck and i haven't lost any front ends. pay me now or pay you later, these pot holes and these wash board roads and bridges falling down, there's a heavy price to be paid for not fixing, maintaining and upkeeping our roads and our bridges. mr. garamendi: there's no doubt about it. you can ruin your car real fast. that five-mile road was a county road i assume. not your personal road. mr. nolan: no, it was not my personal road. it was a combination county and township.

it helped to have been on the township planning committee. mr. garamendi: whatever it took, you got it done. a couple of things that also are important as we go about this infrastructure, and that is who's going to provide the material? i want to give you an example of why it's important that we honor the buy america laws that exist today. we've had buy america requirements and laws for almost 50 years now and those requirements simply say that if it's our taxpayer money or your taxpayer money, then it should be used to buy american-made products and materials. now, out in california we have the san francisco bay bridge. this is about a -- what do we have here, a $3.9 billion project. excuse me, it's not $3.9 billion. it's about $6 billion. it's $3.9 billion over budget.

this project replaces the old san francisco-oakland bay bridge, connecting the two cities across the bay, that collapsed. during the 1989 earthquake. the bridge went out to bid. and the contractor said, i can use chinese steel and it will be 10% cheaper, if we use chinese rather than american-made steel. so the state waved the -- waived the buy america requirements and didn't use them and they went out and bought chinese steel. you have 3,000 jobs in china and -- over budget -- and poor material. in fact, today as was reported in the california newspapers, that one of the major bolts, which is a 25-foot bolt and, i don't know, must be several inches across, that hold down the main pier to the bridge, it's cracking.

so we've got a problem here. now, new york is undertaking a bridge across the hudson river. and it's made with american steel. and american steel is being used. it is the -- the total cost is $3.9 billion. notice that's the cost of the overrun in california. and there are 7,728 american jobs and it is 100% made in america. . when we go about this infrastructure i want to make sure we maintain the buy-america requirements. and we can do it. i want to put one more up. this is one of my favorites. this is a brand new 100% american-made loco motive from

the washington, d.c.,-boston northeast corridor. 70 to 80 of these bib made. and in the american recovery act you remember the stimulus bill. someone wrote in $700 million for amtrak to buy newspaper ones and they said 100% american-made. general electric looked at it and other companies looked at it and germany lo 70, 80, and they said we can do that. see mens, an international -- semens had a plant in sacramento and they made 100% loco motives. they built them and went out across the united states to find the parts and they are building

100% american-made a major infrastructure project, great for american jobs, great for the future. this is what makes -- and this is one of the first ones that came off the lot. my final point and i want to turn it back to my colleague from minnesota. today, on the east coast, amtrak is going out to bid for 28 new high-speed train sets to travel between washington, d.c. and boston at maybe -- half again as fast as the current trains. you can zip between the two cities in two hours or less. they want amtrak, wants a waiver from the buy-america provisions and i'm saying no way period. this is american taxpayer money that is going to be used. we are going to make those train sets in america, and we can do

it. we can do it. we can build these things in america. create good middle-class jobs in america. just like seimens. so this is an opportunity for us as we build our sfrarbg and put together -- infrastructure and take the water resources reform act. keep in mind and always keep in place the buy-america provisions so your tax money is used on american-made equipment and employing americans making those things. i'm sure this is important in your area as it is in sacramento, california, on the edge of my district. i think it is important to americans that we buy american and use our money to buy

american-made products. >> mr. nolan: i represent the largest iron mines anywhere in the united states and we are dependent upon a good strong market for u.s. steel and for minnesota-made processed iron ore and i was so delighted to join you and others recently in petitioning the u.s. department of commerce and the international trade commission to curtail the importation of korean steal. and you know, the market for steal in america is very, very good. and the problem is that american steal is only providing you know about 70% 75% of it. 30% of it is foreign steel

brought in, foreign steel that is subsidized by the foreign governments. our steel workers our mine workers can compete with anybody in the world, anybody in america. we can compete with anybody. but it has to be fair trade and if they have government subsidized below market, cheap steel coming in here that's unfair trade. and guess what? there is about a dozzen steel mills left here and if we don't find a way to curtail the importation of this cheap subsidized steel, we are going to put all 12 of those steel companies out of business. we are going to put 50,000 steel workers out of business and cuentless thousands of mining processers and if we are talking

about the middle class we better start insisting on fair trade in this country insisting as you have so eloquently pointed out here, the significance and importance of making it in america with u.s. steel, when we are talking roads, bridges railroads, pipelines and all the rest. mr. garamendi: san francisco-bay bridge built with chinese steel. they built one of the most advanced types of steel in china, 3,000 chinese jobs zero american and the bridge in new york, american steel. probably some of that, iron ore from your district goes into making that steel. mr. nolan: no doubt. i found in international trade, when it comes to quality, american steel is considered to be the best quality. now what's the importance of that? might be the difference between

a bridge falling down or standing or the difference between a pipeline breaking and polluting a wetland versus not doing that. so there is an economic reason for doing that, reason for the middle class, reason for safety, there is a reason for health, there is a reason for the environment, there are so many good reasons to make it in america. mr. garamendi: you were singing my song, this bay bridge, why was it 9.3 billion over, the steel was unsatisfactory. it had cracks into it. they had to go back and do the welleds. you are so correct about the welds. we are going to make it in america. can i take up oneish. mr. nolan: i thank you for this session here and bringing it to the attention of our colleagues and people across this country

that care about america and good middle-class jobs and want us to see us do what we got to do here and fix this thing and continue the great progress that america has enjoyed. and big part of being an american is paying it forward and now time for us to step up and do what we have to do for the next generation. mr. garamendi: i thank you, mr. nolan. the folks knee minnesota should be great to have you return after a 32-year hiatus. mr. nolan: i'm honored and thrilled. mr. garamendi: thanks so much. i want to bring it up, one more issue. america is blessed with a lot of energy. we have seen a resergens of energy.

importing nation, we can be an exporting nation and one of the things that the american gas industry wants to do is to export a strategic national asset, that is our natural gas. it has allowed us to have one of the lower energy prices in the world. and so that has allowed for a resurgence of manufacturing in the united states and there are other factors, but clearly, the ability to have low-priced natural gas which is the resurgence in american manufacturing. they want to get two, three times more gas overseas and i want to be careful. i don't want to drive up the price of natural gas. but if we are going to drive this up, we ought to consider two other strategic issues for the united states. one of them is the merchant marines. these are the american sailors

and american ships. our military is absolutely dependent on the merchant march eebs. we ship a lot of things on the air on the c-17's. but it is a small percentage of what we need if we go to iraq or any other part of the world with our military. so the merchant marines have historically, from the very earliest days of our nation, one of the key strategic assets in the united states. a second or third strategic asset is the u.s. navy and the shipyards that build the naval ships. those shipyards are critical. if we didn't have them, would we go to china to have them build our aircraft car years and submarines? i don't think so. the shipyards are a strategic asset absolutely essential for

american defense. you have these three things the natural gas merchant marines and the shipbuilding. here's a key to american jobs and that is if we are ever to export natural gas, it will be done in liquified natural gas. you compress it into a liquid and put it on a l.n.g. ship. and this is an example of one. sometime this year, a company chaneer, in texas, will begin exporting l.n.g. they will need about 100 ships to export the full capacity of that l.n.g. capacity. and my sense is, let's use that

export of a strategic national asset to build and to grow the other two strategics. we should require that any l.n.g. shipped from the united states be shipped on american-made tankers with american crews delby lifting up the ability of our nation to grow its economy and to maintain its strategic defense industries, ship building and the merchant marines. at the same time we ship and export a strategic asset. what does it mean? the ship building would be busy. american workers would be in those shipyards and would be making the ships. they would be the shipbuilders. you could imagine what could happen around the states, in baltimore, the coast along the gulf coast and in california

san diego and up in washington and even san francisco, an opportunity to build our economy with once, again infrastructure. the different kind of infrastructure, this is moving infrastructure the great ships that will be all across the oceans of this nation and in the harbors around the united states. american ships american-built ships american sailors exporting american liquified natural gas. yes, we can. we can make it numb america. we can rebuild the american economy. we can focus on middle-class economics with the infrastructure systems that we must build. the foundations for future economic growth and the foundation for american jobs today. make it in america. build america. build our ports, our water

systems, our highways, our bridges, our airports our sanitation system, let's have the society of american civil engineers come back with an a-plus rating when they look at our airports, our rail lines and transit lines, when they look at our waste disposal systems. this is america. we are the people that can build for the future. all it takes is the senate and the house to pass a six-year surface transportation bill and infrastructure bills that are fully funded and provide the foundation for middle-class jobs, middle-class economics putting americans back to work and building this nation's future. mr. speaker, i yield back my

remaining time. the speaker pro tempore: the gentleman yields back the balance of his time. under the speaker's announced policy of january 6, the gentleman from texas plea poe. . -- mr. poe. as the designee of the majority leader.

mr. poe: thank you mr. speaker. it was in the cold, dark damp, moldy walls of a beatup old spanish mission that was already 100 years old at the time. he was a 27-year-old lawyer from south carolina and also from alabama. he was the commander of 187 volunteers from 13 countries and most of the states in then the united states. his men were surrounded by several thousand of the enemy. it was the alamo. it had been turned into a makeshift for the and the commander was -- forth and the commander was william barrett travis. mr. speaker, he wrote the following letter 179 years ago this very night. february 24, 1836.

it's entitled, commander of the alamo, february 24 136. to all the people -- 1836. to all the people of texas and all americans in the world. fellow citizens and patriots i am besieged by a thousand or more of the mexicans under santa anna. i have sustained a continual bombardment and cannon fire for over 24 hours. but i have not lost a man. the enemy has demanded surrender at its discretion otherwise the forth will be put to the sword -- forth will be put to the sword -- fort will be put to the sword. i have answered that demand with a cannon shot and the flag still waves proudly over the north wall. i shall never surrender or retreat. i callen up on you in the name of liberty -- i call up on you in the name of liberty and patriotism and everything dear

in our character to come to my aid with all dispatch. the enemy is receiving reinforcements daily and will no doubt increase to 3000 or 4,000 in four or five days. if this call is neglected, i'm determined to sustain myself for as long as possible and die like a soldier that never forgets his honor and that of his country. victory or death signed william barrett travis commander of the alamo. besides travis there were other famous people. davy crockett jim buoy, jim bonham and many others.

thank you mr. speaker. i will try to finish my comments. mr. speaker, it's interesting that all of these people were volunteers. they came from most states, 13

foreign countries. they were black, they were brown, and they were white. i would like to submit, have unausonntto submit the names of the 187 volunteers that were at the alamo on march -- that died on march 6, 1836. the speaker pro tempore: without objection. mr. poe: thank you, mr. speaker. these hardy band of frontiersmen and patriots, shop keepers, lawyers, were a frightful sight to see. they did not wear uniforms, they wore what they worked in. they entered the alamo and they stood there for 13 days fought here at this place and all died for texas freedom.

they fought against a dictatorship a dictator by the name of santa anna. he had abolished the constitution of mexico. texas was a part of mexico at the time. he had abolished the constitution and set up a dictatorship. that is what started the texas war of independence against mexico. you notice that the flag that is flying over the alamo is a mexican flag. the mexican eagle has been removed. and it has the date, 1824 on it. that is the date the republic of mexico established a constitution. the defenders of the alamo were hoping to re-establish a democracy in mexico. which texas was a part of. but after the alamo fell and all 13 -- after 13 days and all 187 of the texans were killed other texans wept ahead and rallied for texas -- went ahead and rallied for texas independence from mexico. as i said, the defenders of the

alamo were from all races. nine, maybe 11 were tajanos. that's a uniquely texas name. those are individuals of mexican or spanish descent that was born in texas. thus the name texano. the alamo was important for a lot of reasons. but one, it stopped santa anna's invasion of texas. texas was one of several states in mexico that had rebelled against santa anna's dictatorship. on this other chart here there are numerous states in mexico that were established but several of those including texas and others, all of them rebelled about the same time against mexico in 1835, 1836, because santa anna established

a dictatorship and abolished the democracy. none of these other states that rebelled were successful in creating independence except texas. santa anna used his army and went through his own country destroying and defeating any resistance to his dictatorship. and he had taken all of these states back so to speak, when he invaded what is now the state of texas. so he had well-seasoned troops when he came into the state of texas. in 1836. it all started really in the year of 1835. in october of 1835, the mexican army had come up on a small town in gonzalez, texas, and had demanded that the towns people turn over to the mexican army a small cannon that they had to defend themselves from

indians in the area. the locals, the texans refused to turn over the cannon. they in fact made a flag, they called it the come and take it flag, that had a white background and then they painted in a cannon that said, come and take it. that's the famous come and take it flag that was used. the first flag that was used in the texas war of independence. after a skirmish where several shots were fired by both sides, i don't think anybody was hurt very bad, the mexican army left, but most importantly they left without taking the arms the cannon from the texas people who lived in gonzalez. that was the spark that started the texas war of independence. and revolution. there were several other skirmishes. by february of 1836 travis and his band of volunteers had found themselves in the alamo to thwart the invasion of the

larger army of santa anna that was coming from the south. their defense of the alamo for 13 days gave the rest of texas time to build another army to eventually fight santa anna. that army was of course led by general sam houston at the time. so they were in the alamo for the reason -- many reasons, but the primary reason was to fight for liberty for texas and texas independence. when travis realized that he wasn't getting any aid except for a small band of individuals from gonzalez, texas, that came and volunteered when travis sent out that first letter, he penned this letter on march 3

1836. travis addressed his last letter to the council of washington. that was not far from the alamo or san antonio, bear, what it was called at that time. in hopes that they would understand his plight. his battered walls according to the noted texas historian were still -- showed defenses, still flew the flag. his men were on duty and in combat that day and every day and night. they were exhausted. travis expected no rescue. and he wrote according to the historian, apparently to stir his countrymen into action. that the country might be saved. he was speaking of texas. here's what he said. in that last letter. i shall have to fight the enemy on its own terms. i will do the best i can.

the victory will cost the enemies so dear that it will be worse for him than defeat. i hope your honorable body will hasten reinforcements. our supply of ammunition is limited. god and texas, victory or death, william barrett travis. then on march 6 1836, a few days later, they were all killed in the alamo. even though they inflicted tremendous losses against the invasion by santa anna. but travis was right. defeat would cost or victory would cost the enemy more than defeat. it did give sam houston and other texas volunteers enough time to assemble another army. not a large army only 600 individuals.

and santa anna, still with a larger force, met sam houston and his 600 volunteers which once again included men from several countries, included men from several states and had numerous texanos involved, fighting from the side of the republic of texas, including captain and his volunteers, his cavalry. it's interesting to note that before the battle took place, on april 21 1836 on the plains it's near what is now houston, texas, down on the gulf coast, in the marsh area, he had to make sure he had all of his texanos, cavalry, put playing cards in the hat bands of their hats so that they

wouldn't be mistaken for the enemy. in those days apparently the playing cards that were used to gamble were much larger than the small ones we have. so they placed these playing cards in their hat bands so they could be recognized as fighting on the side of the texas volunteers. because once again they didn't wear uniforms. the battle that took place, that travis was able to delay the army of santa anna in reaching this battle, was an interesting military feat. most battles take place -- have taken place throughout history in the early hours of the day. at sunrise. two armies get together and fight it out. they've done that for thousands of years. even still today in world war ii vietnam, battles were fought at dawn. but this battle, the battle did

not take place at dawn. it took place in the middle of the afternoon. on april 21. because santa anna and his army was in a siesta, taking a siesta in the middle of the day. they didn't expect the battle until the next morning. sam houston and his other commanders didn't want to wait until the next day. the troops were getting restless, as they say. so they decided to have that battle in the afternoon. . they marched in broad daylight. he did not put out pickets and no one to warn him that the text anns were charging and came down the hill and the battle began and in 18 minutes, it was all

over. santa anna and more were killed, the rest were captured. only a handful, 13 text anns were killed and the -- texans were killed. and he put on the uniform of a mexican private and he was captured and held. and so travis enters the alamo on february 23, 1836 and writes this famous letter. he and the defenders were killed on march 6. texas had delarppede independence on march 2, 1836. and then just a few weeks later on april 21, about 200 miles or so from the alamo, the battle

took place and sam houston won that battle and texas became a free and independent country. this map here, mr. speaker, you may have not seen something like this. this is what texas claimed when texas became an independent country, what is now modern-day texas, you see it here in this map, but it claimed parts of oklahoma kansas, new mexico cole and parts of wyoming. texas claimed all of this area between the republic of texas. sam houston was the first president. texas was an independent country for nine years and then zited or request to join the united states. even how texas joined the united

states. not all the wanted texas to become a state. after failures for text texas to become a state, texas became on a joint resolution not a treaty, a joint resolution, where it was allowed to or became a state in the united states by one vote when apparently, a louisiana senator changed his mind and voted to annex texas and make texas the next state in the united states and that took place in 1845. so every since then, texas gave up its sovereignty as a republic and became a state and some say we are still a foreign country. under texas law that allowed it

to become a u.s. the texas flag is supposed to fly level with the u.s. flag because we were considered a republic. but we can make that decision and make it five different states. we have a unique history as all of america has a unique history. but it goes back to the fax that texans did not want to live under a dictatorship no matter who it was. that is why people of all races and all races were at the alamo all races fought for texas independence, for freedom and for liberty. very similar to the actions that took place with the 1 colonies, how they were being oppressed by

great britain. nobody thought they could rip great britain, the most powerful empire that existed at the time. and santa anna defeated these parts of mexico that were in rebelion and had not lost any battle. and people were surprised that texas could defeat them and did. because some things were worth fighting for and given their lives for. that's why that 187 individuals from all walks of life from different parts of the world, brown, black and white stood together as volunteers to defend the alamo and help freedom ring in the part of the world that we call texas.

mr. speaker, i think you are probably old enough to have heard of marty robins maybe you haven't. but marty, years ago a singer, wrote a ball add in honor of the people who stayed and defied tirn and gave their lives fighting for treem in texas. in the southern part of texas in the town, there is a fortress that is all in ruin and the weeds have overgrown. you may look for crosses and will never see a one, but sometime between the setting and the ridesing of the sun, you can hear a ghostly bugle as men go marching by. you can hear them answer to that roll call in the sky. colonel travis davey crockett

and 180 more, captain dick inson, jim bowie stand present and accounted for. 1836, sam houston said to travis, get some volunteers and go and fortify the alamo. the men came from texas and old tennessee and a lot of other places. they joined up with travis just to fight for the right to be free. indian scouts with squirrel guns and men with muzzle loaders stood together heel and toe to defend the alamo. you may never see your loved ones travis told them that day. those who fight to the death let them stay. so in the sand he drew a line with his army sabre. out of 18 , not a soldier crossed the line. with his banners dancing, santa

anna came dancing. he sent an officer to tell travis to surrender. travis answered with a shell and a rousing yell. santa anna said i will show them know quarter. 185 holding back 5,000. five days six days eight days travis kept holding again and again and he sent for four replacements for his wounded and lame, but the troops that were coming never came, never came. so twice santa a nmp na charged and he blue recall but on that third time he breached the wall and killed them one and all. the bugles are silent and there is rust on each sword and a small band of soldiers lie asleep in the arms of the lord.

the southern part of texas near san antonio rides a cowboy. he sees the cattle grazing. santa anna were glowing. and he takes his hat off slowly to the men of the alamo. to the 13 days of glory at the siege of the alamo. and mr. speaker, that's just the way it is, i yield back. the speaker pro tempore: the gentleman yields the remainder of his time. under the speaker's announced policy of january 6, 2015, the gentleman mr. young is recognized for two minutes. mr. young: i rise today to speak

about a special fourth grader located in the 3rd congressional district. autumn gattaw is winner if i were a mayor contest. this annuales a contest allows students to vr ideas. autumn and the other district winners are being recognized at the iowa state capital building. in hurries a she wrote if she were mayor of her hometown, she would pursue policies that would preserve the town's history. she notes that this policy would connect the past to the president and promote growth to the future. she would help businesses thrive, bring new businesses and families to the town. recycling and support police officers and firefighters to keep them and the citizens of

the community safe. autumn concluded hurries a by saying, i would visit the school in my community to teach children the responsibilities of a mayor and give examples of good citizenship, to help children grow and learn. i would establish an after-school youth club. being mayor is a big responsibility, but one that is rewarding and important to me. i applaud and congratulate autumn for hurries ayaan for proving that the next generation of leaders in iowa and this nation are preparing for their time of service. i'm proud to represent autumn and her family and teachers in the united states congress. i know my colleagues join me in wishing her well and continued success in the future. with that, i yield back the balance of my time. the speaker pro tempore: the gentleman yields back the balance of his time. does the gentleman have a

motion? mr. young: i move that the house do now adjourn. the speaker pro tempore: those in favor say aye. those opposed, no. the ayes have it. the motion is adopted. accordingly, t

mcconnell then harry reid next on c-span. then secretary of state john kerry takes questions about russia and the nuclear negotiations with iran. then a conversation on press freedom and radicalism. keep track of the republican-led congress and follow its new leaders through its new session. c-span c-span2, c-span radio c-span.org. funding for the department of homeland security runs out on friday unless congress can reach a deal on the spending measure. we hear from mitch mcconnell next to says he is ready for a clean homeland security bill.

[no audio] >> hello. good afternoon, everyone. as all of you know i have put on the calendar last night what we call the collins bill which would, if enacted, prevents the president's executive actions from last november from going into effect. procedurally a vote on that will occur on friday. it would be cloture on the motion to proceed to that bill. in the meantime, i have indicated to the democratic leader that i would be happy to have his cooperation to advance the consideration of a clean d.h.s.

bill, which would carry us through until september 30. with democratic cooperation on a position they have been advocating for the last two months, we could have that vote very quickly. but in event we will have the vote on the collins bill on friday. with that let me turn to senator cornyn. >> over the last week recess, a very important decision was handed down by the federal court in brownsville, texas, ruling in a case brought by 26 states,including texas, claiming that the president's executive action was illegal. the court wrote a lengthy opinion in excess of 100 pages long and issued a temporary injunction barring implementation of the executive action.

as you know, the administration now is seeking a stay of that at the federal district court. if they don't get it there which they won't, they will then go to the fifth circuit court of appeals in new orleans. but the most important point i think we need to acknowledge is that with this federal court injunction in place, any money that the united states congress appropriates for the department of homeland security will not go to fund the president's illegal executive action. because it's barred by a federal court injunction and subject to a contempt of court finding if that was attempted, that's why the administration has stood down and seeking the stay. but what we need to do this week is the majority leader has said, we need to make sure that the department of homeland security is funded. we will do that. we are going to have some very important votes. we would have already done it if it hadn't been for the

filibusters on four occasions by our democratic colleagues. but in the -- at the end of the day, once we fund the department of homeland security under the current temporary unjunction that's in place, no money can be used to implement the president's illegal executive action. >> i know there is a lot going on this week, but i want to draw your attention to something that's maybe gone a little below the radar. on thursday morning the federal communicationscommission on a partisan line vote will vote out something that's called an order in support of net neutrality. the thing that concerns me about that is that this would be the first time that the f.c.c. and 332 pages, this wasn't a transparent process, where the internet is going to be subject to the heavy hand of regulation as opposed to the light touch that's been utilized for so long up until this point. i hope that february 26 doesn't go down in history as the time when the internet moved from

something that was driven by free market innovation to something that's driven by bureaucratic decisionmaking. but that's essentially what we are looking at. it is going to be a very partisan, nontrnt way in which the f.c.c. has carried out their business there is a much better alternate. -- alternative. i have been working with my colleagues on the house side on a piece of legislation that's only six pages long that prevents many of the things that the s.e.c. said they wanted to present. very explicitly presents those things but doesn't ham the s.e.c. carte blanche authority to do whatever they want in the internet. it can be changed by a future s.e.c. commission. this is a very bad precedent and one that doesn't have to happen. we have told the press and the president, we told the f.c.c., we told democrats here on

capitol hill we want to work with them on a solution to this 245 address -- that addresses the concerns people have. the problems that could be out there but doesn't cede to the f.c.c. unlimited authority for them to do whatever they want and put at great risk and in jeopardy something that has been an incredible success story for this country and the world. that's the internet. >> today with strong support of the american people a bipartisan bill has been delivered to the president, the keystone x.l. pipeline. after six years of delay andobstruction, the president is finally going to have to decide where he stands. does he stand with the american people, the great majority of people, who support this bipartisan bill and the energy and the jobs that come with it? or is he going to stand with special interests and washington lobbyists. the president likes to talk but it's time for him to listen. he should listen to his state department who said this is

safe. it provides jobs as well as energy to the american people. he should listen to american voters and people all across the country who want the jobs and the energy. the president does have his pen and by choosing to veto this piece of legislation, he is choosing washington lobbyists and special interests over the needs and desires of the american people. i will tell you the this piece of republican party will continue in the house and senate to put bipartisan bills on the president's desk that focus on energy, focus on jobs, and will help america move forward. >> our friends in the house have been saying it was up to the senate, and they're right. senate democrats have been preventing us from going forward on the d.h.s. bill.

my hope is that the senate will act. i don't know what the house will do. but i do think we have a responsibility to act here. we have a solution to the problem. that deals with both things. number one, giving senators an opportunity to express their disapproval of what the president did in november, and some democrats, as you know, have already announced they agreed with me on that. and the other gives senate democrats an opportunity to have what they have been saying for two months they wanted, which was to fund the department of homeland security through the end of the year. i don't know what's not to like about this. this is an approach that respects both points of view and gives senators an opportunity to go on record on both. both funding the department of homeland security and expressing their opposition to what the president did last november. that would depend on some level

of cooperation from the democrats in going forward to pass what they have said for two months they wanted to pass. you might ask them whether they intend to prevent us from achieving passage. very quickly. and before friday. of a bill they have been saying that they wanted for the last two months. [inaudible] >> i'm not sure what your question s i think the issue before us is this. do you want to fund the department of homeland security throughthe end of the fiscal year so we are fully up and running and capable of dealing with all the threat that we have

around the world, including those against us here at home? and would you also like to express your disagreement with the president's overreach last november? this gives us an opportunity to do both. it gives senators an opportunity who said they are in favor of funding the homeland security bill to fund it. and it gives senators who have said they object to what the president did last november the opportunity to express their objection. and as i said earlier, i know there are at least a number of democrats who said publicly since i put the bill on the calendar last night that they agree with me.

they appreciate the opportunity to go on record. and will have that opportunity on friday. >> i had a pleasant meeting with senator mcconnell. he is willing to have an up or down vote on dhs full funding.

and some kind of a vote on collins. the problem is, everybody, i'm waiting to hear from the speaker. we have to make sure that people understand the bicameral nature of this congress we serve in. so to have senator mcconnell just pass the ball over to the house isn't going to do the trick. i'm waiting to hear from the speaker. he's indicated to me through his staff that he'll be in touch sometime soon. and until that time comes, i think we are where we were. that is we are willing to debate anything they want dealing with immigration after we fund homeland security. this is extremely important. we talked about it today on many different occasions. we need to protect our homeland. we have people being beheaded. people being stacked in cages. one of them has been burned in a wage. we have the direct threat to our malls around america.

and we have to be as prepared for these bad people as isis is prepared and these other terrorist groups to do harm to us. senator durbin. >> it's hard to believe we are talking about another government shut down. think about that. in less than four days the prospects of shutting down the one agency that's supposed to keep america safe. how did this new republican majority reach this point? frankly, they forgot the obvious. first, defend america. protect america. pass the homeland security bill. second, it's within their power to call anything they wish for us to consider next. if it's immigration, so be it. but our first responsibility is to protect this country and to protect it against the threat of terrorism.

the department of homeland security can do that. only if it's fully funded. why they decided to choose this department as the whipping boy when it came to this whole immigration debate is beyond my. but now we know how dangerous this strategy is to the security of this country. if we are going to avoid a government shutdown on the department of homeland security, we need a commitment from speaker boehner that we have a bipartisan, bicameral approach to end this deadlock. >> our position stays the same. we are happy to debate any immigration bill that senator mcconnell wants when there is full funding of homeland security. as any fourthgrader in his civics class can tell you, it takes two houses to fully fund departments, as well as the president's signature. so where's the house? where's speaker boehner? is he willing to fully fund homeland security? or will he stick to a position oh, no, we are going to hold homeland security hostage unless we get our way on immigration? so now all eyes are on speaker boehner. will he fully fund homeland security?

in a separate bill? send it to the president for signature and both houses can debate immigration as long as a majority in each house wants to? or is he going to go back to his old way and say, i'll do this that, or the other thing, but i won't fully fund homeland security. without speaker boehner saying that he will fully fund homeland security, senator mcconnell's offer does not get the department funded. and we need the department funded. we don't need a bill. we need money to go to our police, our firefighters, and the people protecting us. especially during these times when security is at risk. >> a year and a half ago the republicans shut the government down. the entire government down because they were holding the funding bills hostage to a political issue. theyfound out how that worked for them, not well. we need to do today what we did

last time, fund the government. only this time it is a critical agency that protects every single america that they are holding hostage to a political issue. we are willing to debate political issues, but we are not going to hold funding bills hostage to those issues like we didn't last time or this time or in the future. the issue is very simple. fully fund the department of homeland security. that's up to speaker banetory make sure that he does just what he did a year and a half ago fund department of homeland security. >> we, let's be very clear, we want to make sure that there is an agreement on the floor, they rejected it, the president signed a bill, we will come back and debate if they want. to answer your question, yes.

if he says he will agree to full funding, we will be happy to debate anything that he wants to debate on immigration. >> -- [indiscernible] >> unless the speaker is in on the proposal, of course we have to make sure that we get a bill to the president. not that we send a hot potato to boehner, that does not do the trick. >> we are being hypothetical. we have set for four weeks, we must fund homeland security. we cannot do it alone. unless boehner is it in on the deal, it