complete weekend schedule. >> next coming the financial effect of seniors in the the economy. geoffrey canada spoke at the university of california at berkeley. this is one hour. >> welcome, everybody. it is great to be here. it is wonderful to see a full house for this wonderful event tonight. ournt to introduce panelists. but actually, we will start with a short talk, outlining the issues with respect to use in america today.

and then we will turn to a discussion with geoffrey canada. and then we will open it to your questions. there should be cards out there that you can get. i think there will be people circulating cards and collecting cards. those will be brought up to me and i will choose questions to ask our guests. the founding of duquesne capital was done in 1981 and it was closed around 2010. but during that time, they did very well and had a storied career and wall street with his successes. he also at one time helped george a mess a substantial amount of wealth as well. he is a guy that knows a lot about finance. part of what we will be talking about is finance budgets and issues of the future. in fact, part of what investing is about is thinking about the future. so, he is concerned deeply

and profoundly about the future of young people in america. talks,l see when he exactly the degree to which he is concerned about the investments we are not making with young people and how they are crowded out by other kinds of investments we do make. educator,anada is an social activist and the founder of the harlem children's zone , which is started in 1990. the harlem children's zone was designed to try to help children, young people in harlem to get to college, graduate and get good jobs. it is an innovative, comprehensive and intriguing approach. it seems to be successful, and i do not need to be defecating when i say that, but it takes a while to evaluate some of these programs. we do know that many people think this is the model for things we should be doing elsewhere, and in fact, our

president thinks that, having put into the budget some proposals and programs that are actually trying to replicate what has been done in the harlem's children's zone. so, the connection between them is two fold. bowdoinh graduated from college. and the other connection is, stanley druckenmiller has raised the money for the harlem children's zone and geoffrey canada has provided the inspiration and leadership to make it a success that it has come. turn -- andet me remember the. with that, i want to turn to stand druckenmiller who has a presentation to outline the issues of the future of young people in america. welcome. [applause] >> please turn off all cell phones. >> i forgot to turn one off.

[laughter] he mentioned that he and i went to school together. as children of the 1960's, please to think about protests and changing the world, but even back then, i had never been here, but berkeley, california was always the larger-than-life institution where movements started. and -- [applause] it isuckenmiller: interesting. i hear a lot today about how millennials do not think the way children of the 1960's thought and they are not into movements or protests, but i look at a couple examples and i could not disagree more. when i think about how much this generation moved to the needle on gay rights and what you have

accomplished, i think it is ridiculous to suggest that this generation has not been involved in political activism with results. i would say the same thing about this generation in terms of the environment and climate change. i look at the movement that has been made in washington in the last 10 years and i think it is directly a result of this generation's activities and focus. i guess i am somewhat puzzled by the fact however, that there is another thing that your generation has not focused on. , i reason i am puzzled is a think it is a vitally important to your future, but also to the future of the country and it affects you directly. said i am going to give a presentation. actually, i think we are going to of a conversation about this topic. we thought i would throw six or

seven slides appear to get everybody warmed up with regards to this topic. chart --u look at the can everybody see this chart? we don't need to dim the lights do we? red, it is federal payments to individuals, or transfer payments. what you see is back in the bely 1960's, that used to 20% of all government outlays. it is currently 67%. so, over the years we have gone from an economy that used to have transfer payments of 20% of the federal budget to 67%. to put that in perspective, back in the early 1960's, medicare and medicaid combined where .1% of gdp. social security was 2.6% of gdp and discretionary spending was 11.5% of gdp. today, medicare and medicaid are

now 5.6% of gdp. social security is 4.9% and discretionary expenditures have shrunk to 6.5% of gdp. why is that important? because transfer payments are really consumption and you do not get that much return on your investment and they want to highlight the blue line. back in the 1960's, investments as a percentage of the federal budget actually used to be higher than transfer payments. they were 32%. they have gone down to 15%. for the republicans in the audience, if there are any in berkeley, california. [laughter] mr. druckenmiller: i want to remind you that government spending can be a lot more effective than what some of you have been putting out there in the press. what did you get for this blueline? you got the internet, gps, the interstate highway system, and we got nih grants that have

moved the needle dramatically on cancer and other diseases. what has been going on for the better part of 50 years is the amount of money we are spending on transfer payments, primarily to seniors, has been crowding out investments in our future. it is not just investments in things that part of the internet and gps, it has been at the expense of children. this chart is pretty remarkable. what you are looking at is the per capita spending on children and on the elderly as a percentage of the average worker's salary per capita. 11,t you will say is in 20 which is the last year i have good data on, $.56 out of every dollar that an american worker made went towards expenditures for the elderly. pretty much the transfer

payments i showed earlier, but $.08 went to our children. as they have been crowding out other investments, the greater and greater allotment we have been making towards things like payments for medicare and medicaid for the elderly -- we also have medicaid for children, but as you can see, it does not move the data much. social security has been at the expense of money that we might be spending on our younger generation. for some reason -- well, this is kind of sad, but i will work around it. the chart you are supposed to be seeing is the united states poverty rate by age group. hent you see in red, back t president johnson declared a war on poverty. and since then the poverty rate for seniors has dropped to 30% to 9%. i think we can all agree that is a wonderful accomplishment.

there is nothing or than thinking of an elderly person who is far and can make in society -- elderly person who is poor and can't make in society during that same time period, the poverty rate for children -- maybe we have it -- how clever. this is what happens when you are over 60. you don't know how to use technology. [laughter] the poverty rate for children has been on an uptrend. believe it or not, we have made no progress in the last 40 years , even though the war on poverty has been declared a success. it has all been for the elderly, and for children, that poverty rate has not dropped at all. it is pretty amazing. we now have a child poverty rate in this country of 20%. think about that. all most one in four of every child in america grows up below the poverty level. just to show you how horrific

that is, we have taken the 35 leading economic countries in the world and here's the united states. we rank 34th without 23% poverty rate for children. the only country we beat out is romania. we are actually worse than lot via and the other -- we are actually worse than latvia and the other 33 countries. here we are with all this wealth, and all the things we have, and we have the second highest child poverty rate. one in four children in america are growing up in poverty. we have this fancy thing again now. ok. [laughter] mr. druckenmiller: i showed you on the first chart how much we have been spending on our seniors and transfer payments relative to investment and on the second chart, relative to children. look at what that 40 to 50 years of spending more and more on the

elderly has resulted in. this is a little complicated, but i think i can deal with it. what you are doing with here, -- what you are looking at here, you take the average net worth 1983, theups in first of their average networth in 2010. for the first time in the history of america, we have a generation that net worth in 2010 was actually less than their net worth in 1983. that is the 29 years old to 37 years old group. a 29-year-old in 2010 is worth less than a 29-year-old in 1983. but look at the elderly. with the most extreme case being 74 years odlld and older. not only is their net worth not less than it was in 1983, it is 150% more.

as you can see with all of the elderly, their net worth has gone up dramatically. chart,sult of the first as we continue to spend more and more on the elderly at the expense of the rest of our society. so far, i have only talked about the size of the economic pie and more of that pie -- i'm sorry, the proportion of how the pie is split up. more and more, that pie has gone to the elderly. the problem is, there are about to be a lot more of the elderly and a lot less of the working force to support those utterly. in 1957, we had a birth rate of 3.7 to one. we had more babies born in 1957 with 100 million less people than we have today. it is pretty incredible when you think about it. we only had 165 billion people in the country and in the last 15 years, we have never had as

many babies born in 1957. this is as we all know, the baby boom. soldiers came back from world 1957, they did their business with their wives. they left the babies were -- aed and we had a baby lot of babies were created and we had a baby boom. for those of you who can' add, 2012.lus 65 equals let me put it in stark terms. every day, 11,000 people are going to turn seniors. we are creating 11,000 seniors every day for the next 16 years. we are only creating 2000 10 adultting 2000 young workers every day to support those seniors. over the next 25 years, the people that are actually working

to support the retired elderly, they are going to grow by 17%, but the elderly, because of the gray boom, are going to grow 102%. it gets hairier if you look inside the numbers. the over 85 contingent is going to grow by 322%. why does that matter? because as longer life goes on, the more we spend on our elderly in the health care system. the average 85-year-old, we spend two times than we do on the average 60-year-old. we have been shifting more and more of the pipe to the elderly. there are about to be a lot more of the elderly, versus the rest of the society, to support them. and they are living longer. and the longer they live, the more they spend each year and this will cause us financial problems. i used to put a chart up, but it is so horrifying i thought it

would just talk about it rather than put the chart up itself. if you take what we have promised our seniors, in terms of social security, medicare projections, and medicaid projections, what we have promised them versus the tax revenues we have projected, you get a number which we call the fiscal gap. now, the american government uses very interesting accounting. how may people here are 65 or older? well, maybe you don't want to admit it. ok. so, for those of you who are 65 i would assume you think you are going to get your social security check next month. according to the government, that probably is not going to happen because in their accounting system, they don't account for the fact that anybody over 65 is going to get any payments going forward. that is not considered a liability on their balance sheet. there is not a corporation in america -- well, maybe enron,

but they went by the wayside -- who does their accounting that way. the way the government accounting work, the payments these seniors are going to get, they don't exist. if they did exist and you put it on the balance sheet and you took the present value of that an, according to larry economist from the university of massachusetts, the present value of that gap would make our current debt -- which is at $18 trillion -- it would make it $205 trillion. i don't know whether this is science. all i know is, $205 trillion is a lot more than $18 trillion. you can see the problem. let me wrap this up in a nutshell for you. if you look at what we promised current seniors, and you look at the size of the fiscal gap, there is not going to be any money left over for future

seniors, that is the young people in the audience. people might think, "i'm against medicare and social security," but i actually love medicare and social security. the problem is, i love them so much that i think the younger people and this room should be or 50o get them in 40 years too. this is not young versus old. this is smoothing out the transfer from current seniors to the future seniors. that is what we are here to talk about. i realize 30 to 40 years seems road, long way down the but i take heart from your generation and thoughts on climate change because that is road.40 years down the that is another ticking time bomb. ing to gay movement

started in the greatest movement starting place in the world -- berkeley, california. thank you. we will start our conversation now. [applause] that was great. i think that sets the stage and gives new meaning to the old vulcan phrase, "live long and prosper." it looks like some people well and others may not. that is the concern we have. it is not even just the case that we are worried that young people eventually won't get social security and medicare. asare also worried that various government agencies, including the federal government , but also state and localities, which have large pension obligations, as they try to meet these various obligations for pension, for benefits, for medicare, for social security, that that is going to elbow other kinds of investments that are necessary for the next generation to succeed.

and geoffrey canada is the guy trying really hard to make sure we do invest in our children. i want to start by talking about why that is so important and first, what the problem is. what the other investments look like. and then, what we should be doing about it. geoffrey, tell us a little bit about what the problems are. think as i think about this issue, it is really clear to me that the numbers that stan was talking about -- one in four children in america growing up in poverty -- is a disaster. all of the research about what it means to actually be in poverty, when it starts. which is literally at birth, to begin to see changes in these young children who have done absolutely nothing but the born in the wrong zip code or to ghrents who don't have enou

support for them at no fault of their own. we as a society, i think, have created an unsustainable democracy. you cannot continue this and expect that we are going to remain a democracy. quite honestly, i think it is a crisis. i've spent my entire life trying to prove that if children have serious investments, they can end up entering the labor market and being successful. that sounds like a funny thing to say, that i have been trying to prove it, but many people did not believe it was true. when they thought about poverty and the war on poverty, they thought there was nothing you could do about it, nothing works. the truth of the matter is, there are things that work. proving that, i think, is really important. the one thing people should

understand after all of our work an and i have beenhave beest partners in this -- we have kids going through middle school and into my school and into college and then graduating from college being very successful. the point of the whole effort was to make sure those young people have a piece of the american dream. stan and i grew up in the same time. i was a year ahead of them but the 1960's, i always believed in conspiracies. [laughter] youcanada: that might shock to hear this in berkeley, but here is where the whole thing got tied together for the first time. i was in graduate school and someone began to talk to me about social security and life expectancy. and that blacks -- life expectancy was not long enough for them to collect social security. i said, a ripoff. right?

as i became happy to see black life expectancy increasing, then and ittan's charts looked like they got us again. [laughter] mr. canada: i will tell you why you shouldn't laugh about this. from he makes his money understanding things that most people ignore, which i respect, what is going on. quite a while ago, he showed me similar data about housing in the united states. right? he laid this data out and he pointed not just to the year, but to the month our economy was going to become undone. and i am looking at this stuff saying, "america would not let

this happen." "this would destroy the united states." we talked about it and decided we would go to washington together and say to people who should care about this, "you are going to destroy this country, destroyed completely." they did nothing. thegh, i just watched crisis unfold, which we are still living through today. and i learned a funny lesson. you should listen to stan. [laughter] mr. canada: those charts. but you have to understand, as clear as this data is, the data on housing was that clear and nobody did anything about it. i am just determined that for my kids, our kids, that we have invested all of this time and energy in, that we are not going to allow them to get ripped off. because my generation -- and i am part of the baby boomer generation.

my generation quite honestly, does not care what is left 40 years from now. hink that is a disaster. all of this has come together for me. these are kids that we want to break from generational poverty, we have done that. but we know what will happen to these kids if my generation takes all of the money. showedthe way, what stan you, the charts that talk about discretionary funding and how the has shrunk. but when you look at something like what has happened in flint. "how inbegin to say, an american city could we have children being poisoned in front of our eyes, but nobody doing anything about it?" by the way flint is not even the worst place in michigan for lead poisoning. there are 22 other communities

out there where that is even worse. how could that be when this is going on all of the country? when it comes to policymakers, they simply say "we don't have the resources." a lot of this has to do with the state pensions he were talking about, and what is happening with state and city budgets. there is also the entitlement issue. as a nation, it is disgraceful not to do the kind of investments for our kids, given the opportunities stan and i had growing up. that is how i got tied up into is. >> let's outline some of the ways in which we might be under investing right now. between the two of you. areas are we talking about? clearly, we have a poverty problem, but where else are be under investing? mr. canada: when you start thinking about medical support for young people, educational support for young people and what is happening with schools,

budgets across the country. and why i am the first 20 to argue that money is not the answer to failing schools. i would also say it does take money to educate. not that those of you from berkeley would worry about money and education, but we are not prepared to do it when you think about food scarcity, when you think about kids growing up exposed to environmental toxins, asthma, the other kinds of diseases, i -- bythat social services the way, one of the things we are becoming very clear about is young people growing up in poverty have lots of symptomsof more health problems that simply aren't being treated at all. it used think about it, to always frustrate me, what happens when there is a shooting in an upper-middle-class community?

one of those horrible shootings. the first thing everyone talks about is how all the mental health services will be there for the kids and families. they have shootings every day and places and this country and we do absolute nothing will stop g. nobody since mental health to any of them. if you are growing up underneath that kind of stress, which we know, we sent soldiers overseas and they are exposed to a year violence, post-traumatic stress happens for a decade. you have kids growing up with this. at least as a soldier you get to come back home. the kids are home. why aren't we providing any mental health services to these people? one of the things that disturbs me the most -- stan and i were talking to some folks that were visiting -- we get a lot of

kids to stick with our program for years because we have great ofs, sports, and other kinds what i would call high engagement activities for our young people. chess and tennis and you name it and we are providing that. when you are poor, that is seen as a luxury. in most places, luxuries are something we can't afford. when you are not poor, you consider that an essential for your own kids. that is another area where we have massive underinvestment. >> do you have other things he would add to this as well? mr. druckenmiller: i would amplify geoff's health,. i would never forget as the sequester was on funding, both sides of the aisle were not going to balance the budget on the backs of our seniors. so, then they cut infrastructure spending. that is all flint, michigan is.

we are talking about an infrastructure problem. bridges and roads. we did not even know what caused cancer until about six years ago and how it happened. massive breakthroughs, we can genetically sequenced and targeted drugs. now what is going on, we are having our nigh grants cut to do cancer research. so much crowding out. geoff mentioned the other main problems. but i mean, hillary this morning talked about medicaid for children. and the effect on toxic stress and the other things going on. you saw it, they are getting $.08 for children and the elderly are getting $.56. can we just give them a little bit of the pie? because frankly, to invest in a five or six or three year

old, they pay off is a lot better than to invest in an 85-year-old. i might feel different and 23 years, but those are the main issues i would highlight. [laughter] that thed say underinvestment we have done in higher education for young people. i have actually had folks -- stan and i were having this conversation -- say that college education does not pay when you have to borrow huge amounts of money and there is no guarantee that you are going to earn enough money to actually pay back the bills. folks are thinking, these kids shouldn't get a college education. my theory is, maybe it shouldn't for a poorsive kid to go to school. that we should think maybe they should not go to school. [applause]

this is something we should but at the top of the priority list. for my generation, there were schools you could go to when you are poor. when i was in college, right? city college was free. dimew york city, not one did you have to pay because there was this idea that education was the great equalizer. and you should not have wealth determine whether or not you had a shot at education. i think that is a real challenge right now. a lot of kids are thinking they can't afford college or the loans to get through college. that is not the kind of country that stan and i believe that you should have. especially, we should not be leaving that to our children and grandchildren. >> we had a really good question here that will help clarify things. why can't we expand the economic pie, instead of trying to carve

up the one we have in place? so, how does what you are proposing -- is that just saying we should reallocate money to young people? four is there something else going on here that my answer this question? don'tuckenmiller: well, i know who asked it, but if you cut investments and put all the money into expenditures into consumption, the economic pie will shrink over the long-term and over the intermediate term. is the first thing we can do start investing in our kids in investing in productive things and not paying people like me in two and a half years, who is a billionaire, social security checks. it is ridiculous. i don't want to get into my ideas on expanding the economy because they will probably sound partisan. everybody has different views. question, and i think both sides of the iowa degree, if you keep spending

money on transfer payments and consumption and you cut education and keep investing in your infrastructure, your economic growth will unequivocally be slower. >> in fact, what you are proposing is, let's invest because that everybody will be better off. mr. druckenmiller: this is not just about fairness in equity. it is about growing our economy for the long-term and making it more productive. >> let's get back to the the harlem children's zone. tell us about what you see with individuals there who you invest in and what the results are. where do they start from and where do they end up? folksnada: so, for the who care about the research, it is probably the most definitive in terms of some of the real hard outcomes. when stan and i began this initiative -- if you were in my

office and i was trying to raise money from you all, which i told the dean i wouldn't do. but if you so happen to stumble into harlem and my office, i would show you a chart of the incarceration rates in my zone. i would show you manhattan and i would show you what is happening in my 100 blocks. it, afterey calculate a certain number it becomes red. so, the harlem children's zone, looks like on red area. there has been going on all over america. with these kinds of communities we are spending huges amounts of money, not just on incarceration, which in new york state it is $60,000 each year. but here is a number you need to keep in mind. if you go to new york city jail, there are two estimates. $115,000 inmate is

probably the more realistic estimate is $160,000 each year. there are 12,000 in the new york city jail and we work with 13,000 kids. what i think about what we have been doing in these communities, it has basically been just like a black hole for tax dollars. unemployment is sky high. folks are not working. folks are not contributing. we are paying not just for incarceration, or special education, but it goes on and on and on. right now, our college graduation rates are not just higher than blacks and latinos in this country. it is higher than whites in this country right now. the idea is this is where you need -- if you really want to buy intergenerational poverty, you have to get the kids out there and give them a shot. and i think that it is not only the educational

achievement, but the lattice data talks about incarceration, which is almost 0% and teen pregnancy. we have one of the best team pregnancy prevention programs in the nation. when you look at the difference between its in the zone and outside. each one of the indicators i think, is really just trying to take our kids who are at the bottom for the last 50 years and get them back into the middle, so they have some opportunities to become middle-class citizens. [applause] so, what else can we do to make sure the communities are investing in the future in this way? that leads to the larger question too of how how do we get to a situation where someone ending goes toward the elderly? and why is there not more for young people? what are the political issues

here that need to be overcome? mr. druckenmiller: it started with very good intentions. i show the chart in the mid-1960's when medicaid and medicare went on. we spent nothing and those are great programs. social security is a great program, but if you want to get into the raw politics of it, there is an organization called the aarp, which represents the elderly. i started getting notices when i was 50. now, literally, every month. you did too, right? i can we in till i am 65 to collect. no, just kidding. [laughter] an druckenmiller: it is unbelievably strong lobby. and to be frank, the elderly vote. first of all, children can't vote, but more importantly, the young don't vote. for whatever reason, thdean young have not

focused on this issue, but the elderly are focused on it because it is directly affecting their pocketbook. the other having problems focusing on something that is 20 to 30 years out. i think that is the raw politics of it and politicians cater to it. mr. canada: i think what i would add is that when you begin to talk to people about this, there is a belief that these investments that were made simply did not produce any results. folks believe we had a war on poverty and we lost. we spent all this money and nothing happened. folks are things that really demonstrating is that you do get a return. sometimes it is not as sort of quck as you would think. sometimes it takes longer to see what those investments really turn out. but when i go to capitol hill, which if you really want to see your government work, go to capitol hill and try to argue on

the merits of science. you will be extremely disappointed. they think differently of stan if he comes with me. me, i am just coming in with problems, right? i'm not kidding about that. [laughter] mr. canada: the challenge is, when you talk to people, they honestly don't believe in many cases, that these problems have solutions. they just have not seen the evidence, the empirical evidence that says it is not just some -gooder, butral do= is a good investment. if we continue to have our social scientists pile on the evidence, that has to be done in a sophisticated enough way that it meets the skeptical audience, and gives some of us ammunition to begin to push back and say, you canre investments

make that actually to pay off and you will get a real return on the investment. brady: another example of those kinds of investments, just say. arecanada: increasingly, we finding out that any of the sort of strategies that reduced nd families really have paid off. believe, folks did not that it did. i think now there is a lot of research saying that the ability of families to get key services, health, mental health, and implement training -- it really does pay off. that evidence is becoming clear. there is increasing evidence that working in a place, right? when we decided to work in our 100 blocks, there was not a lot of evidence that this idea that if you improve the physical and other opportunities in the area,

it would broadly i think, allow children to do better. i think the evidence is becoming clearer and clearer, that place matters. and we should not have places where there is a sense of despair and that there is no hope that this place is going to get any better. i think that that is also becoming clear, that this place- based strategy, there is evidence that this networks. mr. druckenmiller: attrition develops brain development right from the get-go. that has been proven now. and toxic stress affects brain development right from the get-go. that has been proven. you can absolutely invest in those areas to reduce those. a little morey about this sense of despair because i think many people don't understand what is like to be in some of these communities. veryanada: at the beginning, if you can do holland today, it would not have a clue

what i was talking about. we have pictures we have to show people of what the community actually looks like. it was a disaster. it looked like some bond out place after a war had happened. people have this place that you get used to it. no you don't. you don't get used to that. would you rather be here or begin this nice area? know not like kids don't they are growing up in a place where kids don't make it out of those places. so, i was actually speaking to a young man -- i don't know, samuel, i don't know if he is still here, but he was talking about about growing up in an environment and it was normal for kids to go out and get involved in hustling. hustling is different, but it is all the same stuff. doing something illegal to make enough money. not so you can get rich or

retire, but enough money so you can take care of necessities today, and maybe tomorrow. that becomes the culture of the place, that that is what the expectation is. it goes with a lowered belief that you are going to live. kids who are 14 and 15 and believe they are probably not going to see 20, they do a lot more risky kinds of things than kids who think they have a future. tois much easier for girls cannot care if they get pregnant. they don't believe they have a future and there is nothing waiting and telling them, you are getting out of this place. and despair is infectious, meaning you catch it. i got it and you come in and after a while, guess what? these places have names that people have given them that suggest this is one of those places you don't get out of. harlem was certainly one of those places. this is what we learned. hope is also infectious. right? when people began to see that they -- first of all, we said we

were going to change the conditions. you know how many different entities have come into harlem ?"ying "we are going to change and so people's eyes rolled. and then people began to actually see the physical change. they could see things changing. and then people would come to us and say "can you come to my block and help us with this?" that sense of growing up and having the police. i will give you one last example. harlem was the kind of place that is a kid ended up at a place like this, they might get on the front page of "time magazine." they would be this big story, "kid makes it out of the hood." if you asked anybody when we first started, you know anybody who goes to college? they would say, i think there is this girl on 117th street. you would have to be a genius to go to college. kids in i have over 940

college right now. when they come home, which they are all coming home in spring break, you know what it looks like to be 80 years old and a place for you have 900 kids from their community in college? don't ask them if you anyone in college, they can say "he is in college!" [applause] mr. canada: it changes what the norm is. if the norm is, nobody goes, you would say, i am normal. why would i think i could go? if the norm is, they are in college, i know i can go to college if he is in college. that becomes real. when that becomes the norm, young people have a different sense of what it means to be hopeful. even if you are trapped right now. even if you are in a house and your mom is as strong now as a mental health patient, you see a that doesof this not involve risking your life or imprisonment.

because you see examples of it. you can see that hope right there. that kind of sense of opportunity, i think, is what made america great. and in these places, you got to bring that sense back to these communities. dean brady: let's talk about a few things people have mentioned. some presidential candidates are telling us that the issue is immigration and if we stop immigration, we would solve the problem. how do you think about immigration? is it a problem for america? can it be a solution for america? how do we think about it? mr. druckenmiller: i think all of us are the product of immigration. it might have been this generation or one that -- this country is built on immigration. with regard to the specific issue, immigration is a huge help because you bring in more of the population and get more economic growth and to get more suckers to pay for the older people. [laughter] mr. druckenmiller: this is the way the system works. when you pay a penalty if you

are working, it is not going into view. this is not a pay-as-you-go system. you are paying for somebody who worked 40 years ago. it is a minor point, but immigration with regard to this specific issue is a help, not a hurt. but immigration in general, this country was built on immigration. i don't really understand -- there is not a candidate out there, who somebody in the family at some point, not immigrate. it is just ridiculous. [applause] we see this differently in new york city. when you see the sort of energy, the economic energy that all of these immigrants bring into the city, and i don't think anybody thinks, "that is a bad thing we see going on" as folks try and figure out what their niche is to climb the american dream. i think when you look at countries that have failed totally to bring new people into

their communities -- think about japan and what is happening as that group grows older and they are not able to sustain the populace, you have a problem. i mean, this thing really have consequences. and i think that right now, immigrants are a scapegoat for the fact that we've had you know, a problem growing and sustaining our middle class in america. that is not an immigration problem. it is a real problem and i think an easy way is to find a scapegoat and say, "they are the reason this is happening," as if , if we stopped all of them from coming in, suddenly we would have all of these jobs appearing back. i just think this has been one nds of more horrid kid conversations we have had in this country and quite a while. it reminds me of a time when you

know, it was ok bil villain others, african-americans, anyone who grew up in the 1960's. people were disparaging of that group. this sounds a lot like that to me. i think it is a real problem that we have not addressed fully. mr. druckenmiller: here is another solution. just lifted the cap on capital gains. increase taxes on capital gains and we will have enough money to solve the problem. true or false? mr. druckenmiller: i happen to think they should normalize capital gains and dividends, but and it will bring some money. i think it will be helpful, but in termst a pittance of solving the problem. the funny thing about capital gains tying into this issue, the average 60-year-old has five times the net worth of the average 30 year old.

taxing old people and rich pe lower rate than the 30-year-old plumber is a direct transfer of wealth again, from the young to the old. i don't think that is why it was intended, but i have invested in bunesses for the better part of 40 years. i started a business and this idea that somebody sitting around collecting dividends and kind of coupons is some great job creator, relative to some guy out there working i think, is a joke. so, you are talking to somebody who thinks they should raise or normalize capital gains and dividends, not give them preferential treatment, but it won't solve the problem. it will give you some money, but not solve the problem. dean brady: it is hard to understand the magnitudes of the amounts of

money we are talking about here. mr. druckenmiller: let's talk about the defense budget, which is $700 billion. it is a lot of money and i don't even think that is equal to three years of the growth in entitlements coming up. if he took defense spending to zero, you would not make up for three years of the upcoming growth in entitlements. again, should we have a defense 18dget greater than the countries in the world combined? that is what they equal to just just. probably not. if the probably find a way to cut away a little of the defense budget, but i will say, they have already cut it. those charts they should you up there, the feds used to be 6% of gdp. it is going to be 0.5% of gdp. you can cut a little defense spending, but these are tiny snippets compared to the big problem. if you want to get at the big problem, you are going to have to means test social security. you are going to have to means test medicare.

and yes, since they have already gotten so much of the pie, i don't have a problem with stopping them. it is not like they haven't already increased their share already and five-year-olds and seven-year-olds are suffering because of the expenditures we could be doing for their future. dean brady: how do we start a movement here? mr. druckenmiller: that is why i am here. that is their job. ok, but what should we focus on? how can we get young people to understand it? and how can we also avoid a war of young against old? that is not the goal. mr. druckenmiller: that is absolutely not the goal. the first thing to do is start voting. [applause] issue amake this priority. you know, i talk to young people.

have daughters in their early 20's. i was thrilled when gay marriage was approved for a couple reasons. a, i thought it was great and b, i've up a can move onto another issue now that that problem was solved. so, i got a two for. but if you look at the charts up there, this is a big deal. and one thing i know about young people in this country, when they show in force and vote on an issue and are allowed about it like they were on gay rights and like they have been on climate, the politicians eventually listen, but they have to vote for the politicians won't give a damn. ratesrady: the voting of young people are about half of those 65 years and older. are not voting. politicians are not stupid. they know who boats and they will focus on the needs and concerns of those who vote. that simple. mr. druckenmiller: i don't want

to put this as young versus old. i really don't. one of the things they want to do is talk about seniors and future seniors. do of the things and want to is preserve these programs so they are viable for our young people when they are 65 years old. that is all. end, let's talk a little bit more about the harlem children's zone. what would you like to see if you had a way of expanding around the country, what kinds of investments do we need in our cities along the lines of what you have pioneered? mr. canada: i think the biggest challenge -- when president obama decided to replicate our work and create a promise neighborhoods, if you look at his original announcement before he was president, he talked putting billions of dollars, which was a very modest sum.

if you look at what he was able to get through the congress, it was relatively small. it was much less than any of us thought was sufficient to get the job done. i think that the big lift moving forward is to do a couple things. one, we are doing good work at the harlem children's zone, but there are other folks around the country doing good work as one of the real challenges was they said it couldn't be done. so you can go in and eliminate general poverty and get kids that weren't going to college in significant numbers and then say we had evidence, but you are the only one that can do it. which is absolutely not true. do nota that we need to a minor investment in kids, but to actually put real dollars in there, i think it is really

worth fighting for. there are folks that are continuing to get the evidence that these kind of programs matter. we were talking with some of those folks today. say thatove to politicians would look at the evidence and say thank you very much. i will tell you the issue has certainly been a major -- i learned this from the guy stan used to work for, george soros. he is very much on the left wing of the democratic party. george is left. geoffrey: when governor pataki, a republican, was governor, i have been trying to convince both republicans and democrats to do some investment and youth development -- in youth development and to look at the mandatory minimum sentences

before stuff came up about incarceration rates. i was an organizer and an activist, and people knew me. i was yelling and marching, and we got nothing. george called for a meeting with pataki, which was that george's office. george is a democrat. pataki is a republican. i am in the meeting. the meeting is at george's office per george shows up to the meeting 15 minutes late. i was like, how is this going to work? does not apologize. he doesn't say, "i'm sorry i'm late." he sits down and says, i want three things. pataki gives him two out of three, not because they shared any political believes, but simply because pataki thought, it's probably not a good idea to upset a billionaire. power matters. here i had an activist yelling,

screaming, marching. how you think about with the power levers are to move public policy is something we need to focus on. right now, we have a real crisis in this country. you see it in the electorate. i think the establishment and realize they had a crisis, but people are starting to realize they have a crisis. what i firmly believe is that there will be an opportunity to talk to folks who would never listen to you before and say, there's an answer to what is making everybody so angry, and we have the research to back up why this would be a good political investment. by the way, it's going to cost some money to get this stuff done. until we can get folks to realize, there is money in that budget that we could free up to do some of this stuff, i think we are going to continue to think we are a country of scarcity. nothing could be further from

the truth. this is a matter of whether or not we are going to do the investment. i am kind of a foolish optimist in the midst of this, but i actually think there's going to be an opportunity to have some of these conversations. this time, we've got a lot more evidence, scientific evidence, of what works.>> that is a heck of a note to end on. we thank you for your optimism. we appreciate it given the presidential campaign we are all watching right now. i just want to end by saying, these are two remarkable people, and i feel honored that they came across country to be with us to tell us what they are thinking about, and i think what is quite remarkable is that they come from quite different places, do quite different things, and yet have come together with a concern for this issue. i think that's wonderful, and i think it's indicative of the kind of creativity that exists in america to try to solve problems.

i think the harlem children's zone is solving problems, and i hope we can work at berkeley and around the country to solve the issues we discussed today with respect to the future investment in young people to make sure that we create a future for them that is worthy for them in am -- in america. thank you for coming. thank you so much. [applause] [captions copyright national cable satellite corp. 2015] [captioning performed by national captioning institute] which is responsible for its caption content and accuracy. >> coming up, a conversation with jonathan jarvis. that house energy it commerce committee task force examines the bioethics of fetal tissue research. later, the supreme court oral argument in harris versus

arizona independent redistricting commission about voting districts. click c-span's washington journal, live every day with news and policy issues that impact you. ofing up thursday morning, that reporter for politico will join us by phone from hollywood address the rules for -- rnc political conviction convention taking place in july. the goal to identify the best method to promote skills for the 21st century. maryland senator ben cardin will be on. he will discuss president obama's trip this week to saudi

arabia. he will share his views on a bill that would allow the saudi got to be held responsible in american courts for any role that may have played in the september 11, 2001 attacks. he will preview next tuesday's primary and marilyn. watch washington journal beginning live at 7:00 a.m. eastern monday morning. join the discussion. >> thursday, florida governor rick scott speaks on the first at the republican national committee's 2016 spring meeting in hollywood, florida. his remarksg you live starting at 12: 30 p.m. eastern on c-span three. later will have more from the national committee when we join forr standing committee discussion on recommendations for the party plus july conviction. that is live at 2:00 p.m. eastern, also on c-span3. night, historian ron turnout talks about the hit

broadway musical hamilton, based on the biography of alexander hamilton and the consulting work he did on the musical. >> he said i was reading it on vacation in mexico and hip-hop songs started rising off the page. hamilton's life is a classic hip-hop narrative. i was thinking, what on earth is this guy talking about? he said to me and the spot, because my first question to him was, can hip-hop be the vehicle for telling this large and complex story? he said i'm going to educate you about hip-hop, and he did on the spot. he said you can pack more information into the lyric than any other form because it's very dense and rapid. he talked about the fact that .ip-hop has internal rhyme

he started educating me in all these different devices that are very important to the success of the show. >> sunday night at 8:00 eastern and pacific on q&a. servicetional park director jonathan jarvis talks about the upcoming 100 anniversary of the agency. from washington journal, this is 35 minutes. >> its national park week and we have to does the director of the national park service, jonathan jarvis is the service marks its 100 earth day this year. what is the state of national parks? good.nk it is pretty record visitation 307 , million visitors aos