treasury secretary jack lew about the u.s. role in the global economy. he is at the council on foreign relations in washington. 8:30ve it live at 8:00 -- a.m.. the alliance for health reform with medical professionals and representatives from the kaiser family foundation. eastern one at noon c-span two. here on c-span, "newsmakers" is next with democratic senator mark warner of virginia. then janet yellen sits down with some of her predecessors to talk about monetary policy at the federal reserve. at 8:00, our conversation with "q&a."rah builder on

>> our guest is virginia senator mark warner, a democrat. thank you for being with us. >> our guests are mike and niels. you are up first. >> thanks for joining us today. year in a unique position for a really hot button issue right now. -- you are in a unique position for a really hot button issue right now. you are a technologist by trade. you've taken a deep interest in that industry. there is a grand national debate right now about encryption. your colleagues on the intelligence committee are working on legislation to address this issue. can you give us enough on that

legislation -- an update on that legislation? >> it's going to start to circulate real-time and i'm looking forward to reviewing it. i have the norm's both richard and diane. respect for richard and diane. this is an area that i've spent a lot of time trying to think through. i have a background in telecom and i.t. we started looking at the question around digital security. encryption is part of that but -- it is going to be a minor compared to the debate that arises as we move into the so-called internet of things. when we start thinking of everyday appliances having cameras and sensors that raise a host of policy and security issues. around encryption, bringing the intel backing where i know we have to go after criminals and terrorists but also recognizing

the nature of the network has changed radically since i was in the industry in the mid-90's. what chairman mccall and i have suggested is that we now have tech on one side and law enforcement on another. they both retreated back to absolutist positions. while i do believe congress needs to make the policy choice, until we can get everybody into a room and come up with a common set of facts i'm not sure were going to get it right. we have proposed a 16 member commission that would take a year to sort through this. it would have civil liberties, law enforcement, intel, tech, a cryptologist. the complexity of this issue is really important. what i'm afraid of is that we rush to judgment and end up with an american only solution around

this issue. we could end up resulting in driving criminals and terrorists to foreign-based hardware and software. there's literally 2000 apps a day added to the itunes store. over half of those are being developed internationally. most of them are encrypted. we have to worry about the challenge of going dark. >> does congress have a year or two years to come up with legislation? just a few weeks ago we had the apple versus fbi case. it sounded like this was near crisis proportions. is there -- isn't there a sense of urgency? >> absolutely there has to be a sense of urgency.

while the one particular case was dismissed, there was another case in new york. there will be other cases that arise. those will be going through the litigation process. getting this commission stood up sooner rather than later is terribly important. the commission approach has been endorsed by the former homeland security secretary. we've been endorsed by the chamber of commerce, national sheriffs association, a number of tech associations. both the washington post editorial board and the wall street journal editorial board. i think if we don't act quickly on setting up this commission then you will see congress forced to act before they get that common set of facts. let me acknowledge on the front end that too often commissions

are viewed as a punt. we've tried to model this commission after the 9/11 commission when there did emerge a consensus. congress acted in a bipartisan fashion. we set up a 16 member commission that would require agreement of 12. basically a two thirds plus majority to have a recommendation come forward. i'm very reluctant that if we move in advance of getting a common set of facts that we could actually make americans less safe because everybody agrees encryption is important to protecting our national security and personal information. we have to make sure law enforcement and intel have tools to sort through that. >> are there any concerns with the litigation pending in other cases that are probably going to arise that whatever congress is doing or whatever -- your commission would develop could actually be preempted by the litigation and the courts could

jump in and front run congress on this? >> the litigation process i think will drag out for some time. what we try to do is set up a one-year timeframe with a six-month report. i believe that if you get the right people in the room, a lot of this has been litigated somewhat in previous reports and elsewhere. they have not really said, you have to give congress a common set of facts. we need to set the policy. congress needs to do its job. as somebody who has spent a career in this field and has spent the last five years digging on the intel side, it's extraordinarily complex. i'm not sure if there's enough technical expertise in congress

when you've got apple taking an absolutist position and the fbi taking an absolutist position. we have seen that both of those did not necessarily come to pass because there was a different way around this problem. i mentioned the police chief in san bernardino has endorsed the commission as well. if it does not get legislated very shortly it loses its ability to get to a solution. >> senator, i know you are at sxsw last month. i was there to cover president obama giving a speech. this issue came up. one of the comments he made that i think people were struck by was -- you cannot have an absolutist view. and if we end up adopting the position of apple and some of your colleagues in the senate

that we maintain strong encryption and have no back doors for government to access -- the way president obama put it was, it would be "fetishizing our phones above all other values." that we maintain strong >> i'm not going to parse the president's individual phrase. i do know this. you have everything from director currently -- komi -- comey to the head of the cia. it makes us safer. encryption makes americans safer. at the same time, law enforcement and the intel community has a need to be able to follow the communications and movements of terrorists and criminals. i question whether holding in a backdoor which sends a signal

that you are going to have a vulnerability that no matter how carefully you guard keys could be exploited -- whether that is a solution that really makes us safer. i think there will be other tools. there was another methodology used around the apple phone in san bernardino. remember -- encryption takes place on the device. in terms of software. at the network level. one of the things that i would be worried about is if we mandated a backdoor, two things could happen. you would have smart criminals and terrorists simply buying a foreign-based phone that wasn't subject to american jurisdiction or, a smart criminal or terrorist would simply import from the cloud encrypted software onto the phone even if it had a backdoor.

so there are challenges around all of this. this is not just a debate taking place in america. there is similar legislation in the u.k. and france. it is going to require a global type solution. i think america can lead. but at this point when you've got tech and law enforcement in opposite corners, the intelligence community has been more leaning in in favor of the commission approach. this is not just a debate taking >> i'm probably breaking this news to you since the statement came out just moments before we all sat down, but the aclu has

apparently gotten a draft of the feinstein legislation and they are quite critical of it. they said in a statement, is a clear threat to everyone's privacy and security and it ignores economic and technical reality. >> i think i need to review the legislation. what i've heard about it is they have a goal that i would love to have us all get to where legal warrants can be enforced. but i'm not going to criticize that legislation until i have had a chance to review it. i do worry that people may take their intent and layer on things that are not in the legislation. candidly, we will not end up with a solution set here that every entity is going to agree upon. there's going to have to be balancing of interest. i do believe that there are rights of privacy that can be protected. law enforcement needs intelligence needs and we can create an ability to maintain

innovation and technology that americans and world consumers want to purchase. i point out the apple san bernardino case. both sides said there was no solution. one side said short of a backdoor. the other side says, it's not going to happen. there are ways to work through these issues. if congress -- i'm hanging on by my fingernails in terms of -- if congress tries to legislate without a common set of facts, i'm concerned about the outcome. we might be appearing to make americans safer but in reality not actually accomplishing that goal. >> we have some other issues. >> i wanted to transition to something that of interest to your constituents in northern virginia as well as everyone who lives and works in the washington metropolitan area which is the state of the public

transportation system that we call metro around here. there have been reports and some discussion that there may need to be entire lines that may need to be shut down for weeks at a time for massive repairs. the system is now in its 40th anniversary and -- what do you think is the federal role in terms of what needs to be done and also one of the issues has been with the state governments and you used to be the governor in virginia. what does everyone need to contribute and is there any chance that that's actually going to happen? >> let me take this in two bites. as a long-time supporter of metro, i've been really disturbed and frankly angered at the failure to enforce a culture of safety. we saw a horrible tragedy a number of years back in maryland where a number of individuals

were killed. we saw the incident where a virginian was killed at l'enfant plaza. as we dug deeper, we saw that actually lack of publicly trained personnel at the control center for metro. we would beat on the previous management, you've got to get this fixed. we changed the jurisdiction of oversight to the dot in terms of the oversight as well as for unprecedented -- brought in federal transit to go through the safety audits and then actually put personnel in place so the ridership would have that level of security. we saw recently that the new general manager actually shut down the system for a one day basis because of the potential of the kind of harm that fires

in the tunnels that could create smoke challenges. i think we were all a little shocked at that but candidly, i think it sent a good message that this general manager puts safety first. i commend him on that. i have heard just recently at well that he has made comments about the possibility of shutting down lines for an extended period of time was not on the table. it will require perhaps less service on the weekend and evenings so they can do the renovations that are needed. i think we are seeing a movement in terms of the culture of safety. on the financing piece, we had the brightest shiniest newest metro in america 40 years ago. that system has aged. i think there have been challenges around ongoing maintenance. this is not just a metro problem.

deferred maintenance is a challenge all across our infrastructure. we are celebrating the 100th anniversary of the parks service this year. how we make sure we maintain the funding for metro is critically important. we have seen members of the house want to cut the federal government's commitment initiated a number of years back by tom davis who did a great job. $150 million dollars a year that the feds were going to put in. if you cut that, you put metro into a semi-death spiral because metro has to increase the fares and that means less people ride and you are in more financial duress. honoring the federal government's commitment to that $150 million at least a year is critically important. this is the nation's metro system in terms of people visiting the national capital region. at the same time making sure

that states and localities chip in their share as well i think it's going to be an ongoing debate. part of making the case for additional revenues whether it's for a dedicated revenue structures are making sure we get federal money or increasing regional contributions -- those arguments are harder to make when you don't have that culture of safety. i think the new gm has sent a strong signal about safety. and about maintenance. i think the shutting down of the system, while an imposition for that one day, was in retrospect probably the right choice. also to the employees that inappropriate safety focus will not be tolerated. the more he can continue that, the better we will be able to shore up the necessary financing.

>> seven minutes. >> you mentioned dedicated funding. assuming the new gm can get the safety footing, has the time come for the region's jurisdictions to get together and do a dedicated funding source? >> as somebody who got my tail whooped when i advocated for a regional northern virginia taxing ability, that was 10 years ago. more than 10 years ago actually. i'm not going to -- took a step in the right direction in terms of funding. whether there would be a metro specific, i think it's too early to judge it until we see continued improvements. >> do you think the

congressional representative of all these jurisdictions need to play a role? >> in terms of the congressional delegation is making sure that folks in the house who want to cut discretionary funding clearly have gone after metro in the past. and that we keep the feds commitment to this critical infrastructure. not just for the region. but this is how the country and the world sees washington. >> we have six minutes left and two big topics. i want to start with presidential politics. what does bernie sanders's success on the campaign trail have to say about the future direction of your party for someone like you who has -- reputation and is a capitalist?

>> i think bernie is tapping into a lot of dissatisfaction. i believe the best policy is not made on the extremes of the left or right but with some bipartisan consensus. the challenge with that premise -- would not put a lot of points on the board in terms of the bipartisan consensus in the last few years. i also think he has tapped into enormous uncertainty about economic inequality. almost equal to those challenges are challenges around income insecurity. i think americans have not minded people being successful, but when they feel the kind of income volatility they are seeing at this moment -- people have a right to be angry. i am somebody that believes in free enterprise. i don't think modern american capitalism with its focus on short-term quarterly based returns is doing well enough by the vast majority of americans. i'm working on a project through the aspen institute looking at this issue.

mitch daniels is my cochair. how do you make capitalism work in a 21st-century way? how do you -- longer-term investments? how can you actually have a tax code that incentivizes investment in human capital? we need to make capitalism work for a broader group of people or the anger that bernie is tapping into on the left and that mr. trump is tapping into on the right could undermine a system that has worked pretty well for us. >> do you want the budget? >> i will take on the budget the best i can. i think what we are hearing the senate -- mitch mcconnell says he's going to move forward with a appropriation bills despite the fact that they can't necessarily get to a budget resolution this year.

but do you think that that can get done, that the appropriations process can actually work in an election year and more broadly, you've been involved in these broader fiscal discussions over many years now, what do you think it's going to take? is there any hope of any of that with however the presidential elections turnout this year? >> some of the biggest disappointment since i've been in the senate is that we didn't put our balance sheet back in order. we didn't do a variation of the plan that took on entitlement form and tax reform. we have managed to avoid the stupidity of sequestration for the last year or two. i'm hopeful that leader mcconnell puts those

appropriations bills on the floor. to get it through will require not having that extreme crowd in the house try to recut the deal that was made last year in terms of the topline numbers. and to make sure that these appropriations bills don't layer on a whole series of what's called riders, social issues. you want to debate immigration, don't do it on the appropriations bills. if the leader and speaker ryan agreed to those topline numbers, we look at those bills done and that will be better serving. it's a more rational way to manage our government. but the bigger issue of our balance sheet is coming back. sequestration comes back a year from now. we have now run up $18 trillion plus of debt. when interest rates go up, just one point, that adds on an annual basis $120 billion of additional debt service every year and that trumps every other payment -- social security, medicare. that is more each year just on

that piece of the debt spending on interest than we spend on homeland security. that's more than we spend on homeland security and the federal department of education combined. all of the projections say that deficits start rising again. this big moving problem is going to require both parties to make compromises. the democrats have to realize we have to make the promise of social security and medicare available for people under 35. that means recognizing that people are growing older and the math just doesn't work. we need a tax code that is more

streamlined and generates more revenue. we are 31st in terms of total taxes collected. you have to look at the facts. the good news is that getting our revenue stream back to where it was in the 90's, making phasing in some changes around social security and medicare over the next 10 years, nothing immediate, nothing for people currently receiving those benefits, we can get this fixed. if we don't do that, discretionary spending -- education, infrastructure, research and development, military -- those are on a path, on a steep incline past -- decline path. that's not going to keep america competitive. >> very quick. >> really quickly, i don't know if you've been following the race across the potomac in maryland. congressman van hollen has been engaged in these fiscal talks.

he's getting hit for even suggesting cuts for social security. even suggesting cuts for participating in the talks. what do you make of that? >> i'm not sure -- i'm a friend of chris van hollen. i support chris van hollen. i'm not sure that helps him as a virginia guy supporting a marylander. don't hire people with absolutist positions. who say they will never raise taxes or never touch entitlement programs. all you are going to get is gridlock. everybody in congress needs to come in with an open mind. the idea that you can't even discuss the math around the fact that when i was a kid there were 16 people working for everyone person on retirement and today there are three people working for every one person on retirement -- the math is changing.

>> thank you for being with us this week. welcome back to newsmakers with our two guests. i want to start in reverse order and his comments about the budget process. >> sen. warner has been engaged in talking about the long-term fiscal challenges since even before he arrived in the senate and what we heard today was more of the same from him about his frustration. but it really is -- there are a lot of questions about whether any of us can ever be resolved or if we are going to reach a point where social security reaches the point of its unsustainability. whether medicare costs get to extreme for anyone -- too extreme for anyone to deal with.

warner is in a camp of a dwindling number of democrats and moderates in both parties who actually would probably vote in support of proposals that would perhaps doom them at election time. >> he talked about a process that needed no social contract riders and to make sure they didn't add things to legislation that would make it unpalatable in the wrong one. -- long run. >> we've seen the house republicans can't pass a budget -- you want to talk about riders, they can't even get the appropriations process started. we will see next week if there is any hope. what struck me about what senator warner said, at the end, you could sense a concern that

perhaps the same thing is happening on the democratic side. was discussing the maryland senate race, he has worked with chris van hollen, and i think he is concerned if democrats are getting primaried on the left for being part of these grand fiscal talks, it bodes ill. >> we spent a good deal of time on the encryption issue. you talked about the necessity of dealing with this now because of the urgency of cases, getting to the courts. how amenable with the political process be to a 16-member commission idea? >> you say the word commission, americansk most cringe and say, what do we need a commission for? i think he makes a strong case that you have such a polarized mood between the national security and law enforcement

absolutists and the digital privacy absolutists on the other side that it might be the only way to get the facts on the table. is there a likelihood of passage of legislation empowering the commission. -- commission? >> perhaps the commission has a better chance on making substantive decisions before the election, but the other point is, of course, when you are doing with congress, and more specifically with the senate when it comes to an issue of technology issues, it's always good to remember how not adopt at technology -- adept at technology a lot of people in the senate are. senator warner is unusual in the fact that he has a background in the technology sector, and he

says things have changed since he was in the business. there are a handful of senators who still use flip phones and don't access e-mail on mobilize devices. -- mobile devices. move more broadly. what does the senate look like between now and the convention -- the election? >> they are on the faa bill. that seems to be going well. we will see what happens next week. they are going to be doing appropriations without a budget in the house, and a dearth of legislative vehicles to do the bills with. it's really unsettled right now. add on top of this the supreme court battle, which is suffuse in everything that is going on with a partisan and nasty