that fema, when we have emergencies like this where ourisiana, president can give $400 million to and he is attacking our ships, shooting at our planes, why do we give the $400 million to louisiana and they can rebuild right away? does that make any sense to you? guest: i certainly cannot comment on the iranian situation. fema will be giving louisiana hundreds of millions of dollars. host: doris is waiting. caller: good morning, how are you this morning? daughter, who, my has resigned her job a month ago

, has to put all of her household belongings in a storage in baton rouge. she is out of state. fematype of help would give her for all the damages? from what she was told, there was four feet of water in the storage. if she owns a residence in the louisiana, she is entitled to assistance. there is actually a pretty quick, simple questionnaire you can fill that will provide you with the list of federal assistance programs that she could potentially get for the flooding event. host: william in alabama. good morning. you are talking about disaster. you only need to remember one thing.

i am 85 years old. 20 years ago, we had a storm that cause tremendous damage. all you need is flood insurance. now i have lost money and invested in insurance. diego,n airplanes in san i come back home, they fixed my fence, my house, everything. all you need is insurance. host: running out of time. an advocate for proper insurance. guest: absolutely. and flood insurance, if your community is eligible to get it. a lot of the floods in this country, homes that are flooded, are not in high-risk zones, and that is what we are starting to see with these flooding events

like in louisiana, west virginia. is from thecurrie government accountability office. that will do it for today's program. go to the brookings institute, the center for 21st-century security and intelligence, hosting a panel discussion on defense spending and priorities into the next congress and presidential administration. we will see you back here tomorrow morning at 7:00 a.m. eastern. [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit ncicap.org] >> welcome to the fourth consecutive last week of summer, depending on how you define it. in montgomery county, we are done. virginia, kids are enjoying one more week. hopefully they are watching c-span. we are glad to have you here, .nd we will be involving you

we will be talking today about a broader federal budget that will begin with a specific issue of the pentagon budget, and more specifically than that, the war budget, or more commonly known as the overseas contingencies operation fund. that is a $60 billion a year thing. billion ine to $200 during the wars in afghanistan and iraq. you think about how to address the issues associated with this particular fund, you wind up needing to talk about the entire federal budget and certainly the budget control act , which has given us the pleasures of sequestration, and which could still do so again, to remind you. the budget control act would still be in effect for the entirety of the next president's term in office. today's discussion will be about whether that is a good thing,

whether we should revise it, repeal it. of course, that raises questions about what is the proper level of domestic investment and national defense spending and of the entire federal budget for the united states. that is my we have this distinguished panel. .et me introduce each of them honored and thrilled to have each of them with me. then we will go to a discussion amongst the four of us. i will ask each of them a question to get things going, we will talk for a while, and then involve you with your questions and concerns. the lineup begins with former undersecretary of defense robert hale, who is now at boozer senior fellow. booz allen hamilton holding an important contributor to our defense industrial base project over the years. , he was thejob comptroller of the pentagon, the

chief financial officer of the pentagon. bond is a stanford grad in mathematics. when we think about stanford these days, we are thinking about katie ledecky. for all the pain that she has gone through in the swimming pool, i don't think it begins to compare to the pain that bob has gone through trying to indoor sequestration. he was the guy at the pentagon that found a way to survive it. some would say he did too good of a job because that made sequestration seem tolerable and we may have it again. sequestration is the automatic spending cuts that kick in to bring us down to a lower spending level if there is no deal. this is all necessitated by the budget control act. bob is a very distinguished and patient government servant.

previously, he had been comptroller of the air force, director of the national security division, congressional budget office. mcguiness, is maya president for the committee for a responsible federal budget. she has been one of the most tireless, maybe the most tireless, people favoring responsible fiscal policy in the past two decades. she has been exemplary and how many vehicles on how to get the word out, including through writings, testimonies to congress, coalition building, working with younger people whose futures are most at stake. alice rivlin is next to me. i get to see this one more time because hillary clinton has not

been elected president -- i hope she is soon. that is my own view. alice rivlin remains to be the most accomplished woman in political life in our history. she is the founding director of the congressional budget office, she was the vice chairman of the federal reserve board. one some people would have called it a career after that, interspersed in that were many positions and brookings. when she retired from the fed, she helped d.c. fix its finances. she remains one of our most distinguished and eloquent voices on all matters about the economy and certainly the federal budget. after bob has talked about this issue of the overseas contingency operations, then we will get into a broader discussion about the federal budget policy and federal

economic policy and the future of our country. that is what it is all about in the end. one more thing before beginning with a broad question. by the way, i will also do a quick advertisement for my booklet about the pentagon but -- booklet. my argument is we should suspend about $650 billion a year on the military, a bit more than we are spending now. so if we are going to spend more on the military, what about the rest of the budget? dod is only 15% of spending. another 16% is all of the other so-called discretionary spending we do as a federal government. , for those of you that do not follow this day in and day out, accounts, programs, capabilities that have to be appropriated each year by the

congress. if not, there is no money. entitlements, like interest, is the other two thirds of the budget. like interest, is the other two thirds of the budget. things that we value as individuals but have less to do with long-term national power. if you are thinking about the strength of the country, i think of military, highways, infrastructure, science federal funding for research. all of these things are in the so-called domestic discretionary accounts. therefore, to my mind, are not so much discretionary, and are getting squeezed through the budget process that we have come to know and love as this budget control act with the looming specter of sequestration hovering over our next every year or two. that is the broad context. now i will ask my colleagues to expand on some of these themes.

noting,ant to begin by you have often said the turbulence in the budget at the pentagon has been one of the biggest handicaps. could you explain more about that problem, how to solve it? bob: thanks for the chance to be here. if i was looking at the next administration and the issues they face, the most important would be finding a predictable and reasonable level of funding for federal agencies. i will focus on defense because i know it best. to the010, we have gone enormous turbulence in the department of defense, 2013, we had the sequester cuts which harmed in the mission effectiveness by leaving inefficient and funds for , we did, wasted money not allow civil servants to work. at the time, many senior leaders could have spent time on better things. we need a reasonable, andictable level of defense

funds. to do that, we need a long-term deal. this includes mandatory spending, social security, revenues, and considers all of that in context of the deficit. in that deal, i would keep the budget caps, because i think the process needs discipline, but i would raise them for defense and probably nondefense also, probably to the levels currently proposed by the obama administration leve. pressure on the overall negotiations. you would need to also look at some ups and downs. say to yourself, this guy has his head in the sand. with the divisiveness and a political debate, how could we see such a deal?

i remain hopeful that we will get beyond this divisiveness. we will elect a president who will have to deal with these issues. i am at least hopeful that we will see a broad budget deal. i think it is the only solution. the other issue for defense in particular the next administration has to deal with is the future of the overseas contingency operations put in the cost2012 to cover of the iraq and afghanistan war. i just wrote a paper and there are hard copies out there if you are interested. is very important financially to the department of defense. served the nation well, making sure it nature funds were available, so that those involved in combat with have the resources they need. i think there's probably nothing more important than the department to do. there were also some timing problems, the supplementals use were enacted late,

not enough time for dod to effectively put them in place. it has been harshly criticized because it has been used to get around the caps. oco is not subject to caps, so we have put money into oco that should've been in the base budget. if you are interested, we can go into it more. so what does the new administration do? the ideal thing to do is to put oco back where it was but only use it for wartime needs. that would probably mean moving several tens of billions of dollars out of this war budget into the base budget. , that they areid already too low, i don't think that is practical. regrettably, in my view, the administration will have to keep oco, try to keep it back in its box, maybe make some small moves , but i think a practical solution will require that it continues. we need a broad budget deal that

helps defense and other agencies get more stability and ,easonable levels of budget unless the administration has to do something about the future of oco. host: one follow-up question. michael: i would like to ask more about the paper itself, recommend strongly, a shorter version is being published on week.al interest.org this a longer version on the booz allen hamilton website. it is a very nice read. if you could summarize some of the key points, including out of that $60 billion oco budget, roughly how much has gotten divergent for purposes that would not be optimal? secondly, if you have any notional sense about what the pentagon budget should be. i guess you said consistent with president obama's request. if you could spell that out for

some -- with some rough numbers for the crowd. bob: they just set it higher than what they think the department needs. there is a lot of money in oco that is in a gray area in terms of its contribution to wartime needs. it down to to get war needs only, i cannot give a specific number. i think it would be several tens of billions of dollars that you would need to move out of oco and put into the base budget. the reason you do not want this , several reasons, but the most important one, dod tries to do long-term planning to have a consistent five-year plan, so you don't buy a bunch of stuff you cannot support in the out years. it is hard enough to plan wartime needs one year in advance. if you start putting large amounts of the budget in oco,

you lose all of that consistent plan a, you lose the budget discipline. i think it is just a bad idea. paul ryan, when he was speaker of the house, said that he was using oco to undermine some of the budget needs. to the greatest amount we can, we should avoid it. michael: do you have a number that you would be culpable with with the pentagon budget? bob: i would be comfortable with the obama administration proposal, summer 0, 550 range. michael: there is a handout, for those of you here in person, which tries to summarize some of the numbers. these get confusing. bob just gave the cunning on base budget, so he did not fund in that,o

and also not the nuclear weapons activities of the department activity. , ifnd to pull them together you want to look at it in a global sense, the national defense function. that is summer over $600 billion. once you have added the base budget, oco account, nuclear weapons activities. that does not include the veterans administration, which is another $175 billion a year roughly, which is not relevant to future defense needs, but the debt we owe to those that have been wounded or killed, their families, in previous military operations. it also does not include the department of state's foreign assistance program, including security assistance, two countries we are working in partnership with. it also does not include the department of homeland security. so there are a lot of things related to defense not within that 0505 budget.

they are all in non-defense discretionary, so everything is getting squeezed. anyways, depending on what number you are looking at, the definition, in broad terms, i would say defense spending is just over $600 billion a year. the is considerably above cold war average in inflation-adjusted dollars. i still think it probably needs to go higher, as bob argued. now let's broaden further. i want to ask alice what she would think of as an adequate funding level. we will get into the issue of the budget control act and what the next president should do. even though you may not to give a precise answer, i was reviewing the historical data on how much we spend on non-defense discretionary. in thercentage of gdp, 1960's, it started in the low 3% 4% in thet up to

johnson administration, 5% during that liberal richard , stayed updency there through the 1980's. ronald reagan never dropped it below where it is today, about 3.3% of gdp. it has been in that range until the obama administration got into the low 4%. now it is back to about 3.4% of gross domestic product, and it is headed down to projections of about 2.8%, the lowest level since the eisenhower administration relative to the size of the economy. so that raises the question of how much is enough for these domestic investments. with all due respect, mike, that is a silly question. it would be nice if one could

say, here is a number. there is something sacred about this number. it is silly on both sides of the budget. sat down with a group of defense experts, people with stars on their shoulders. i was the economist in the room, and they said, just give us a number for how much we should spend four defense. how much we can afford to spend on defense. then we will figure out how to spend it. that may sound reasonable to spendbut what you need to four defense depends obviously on what the threats are two the country, and how we think we should be dealing with them. spending roughly 3% of our gdp on defense right now. dide was a time when you

not mention mr. and the cold war , when you are spending 10% of gdp on defense. we perceived that we had to do that. we do not perceive that now. the domestic side of the budget is roughly the same situation. in my opinion, the two big problems facing the u.s. economy, as we look ahead, are we need to grow the economy faster. there are various ways you can think about doing that. but there are some obvious ways that we are not doing. we are not modernizing our infrastructure, roads, bridges, highways, train systems, sewer systems -- whatever. all of those need to be modernized. it would create some jobs in the process and some not bad paying jobs.

essential toe is looking at the future, as is development of the skills of the workforce, staying on the forefront of science. that does not tell you exactly what you should spend it for. you should spend it well and on sensible projects. we don't always do that. that is the question we ought to be talking about. threat that we are not talking about at all -- maya keeps trying -- if we go on doing what we are doing in the federal budget, we are facing a debt, and one that is growing quite rapidly looking down the line. why is that? we have an aging population and

socialcommitted to security benefits, but more importantly, to health benefits for people as they get older. and we have an inadequate tax uptem which will not keep with those spending needs which were already committed and is pretty inefficient system to -- into the bargain. the real conversation we ought to be having, and bob suggested this is how are we going to bring those to give your budget ,ines together in the future with the needs of an aging population, and the revenues to support those.

that is partly a question of can we deliver health care more efficiently? it is partly a question of can we have a tax system which is more progrowth, but also more productive of revenue than the one we have got. the answer to that is yes. we had a lot of conversations about that five years ago when we were in the simpson-bowles mode. the president was talking to speaker boehner, everyone was trying to get to the grand bargain. we did not get there. the budget control act is a bizarre piece of legislation that was supposed to get us to , to say weargain will create some cuts in domestic and defense spending that are so unacceptable, nobody would want to do them, and

therefore, they will get us back to the table to do the grand bargain. maybe it was a nice idea, i thought so at the time, but it did not work. on it has gotten us focused the discretionary part of the budget, both defense and domestic. discussing things like the problem of the overseas contingency operation, which is essentially a problem of how the defense department was able to and with unrealistic cap's cheated a bit in the bargain. now we will figure out how we get back to something sensible. something sensible is talking about what we want the government to do and how we want to pay for it in the long run. we cannot be incapable in doing that. up onl: if i could follow

the overall budget, i want to make sure i understand, whether you think the current track we are on for discretionary spending is acceptable. alice: no, i think it is much too low. that is because of the need to invest in the future. if we just let these entitlement programs, which are mainly for older people, and i am one of if we just let those escalate without inking about how we control the spending, then we force out investment in younger people and investment in the productivity of our economy. nothing could be stupider than that. michael: bob has talked about being content with obama proposal numbers on defense. i would maybe go a little higher. we are talking about a few tens of billions added to the annual

budget. you have a rough order of magnitude for the domestic side? alice: no, i don't. i think you need to look for what at proposals you would actually invest in, and it should grow slowly over time, as you get more experience in what works. people are talking now about bringing private sector money in through an infrastructure bank. i don't think that is a bad idea but i don't think it will solve the problem. i do not have an exact number in mind, but it has to be a balancing act between what is productive spending on the one hand, and how much can you slowly grow spending in the future, so that you are not getting onto a worse debt trap and we are already on. not want to may

give an exact number. do you think it is the same kind of magnitude that we are talking about on the defense side, tens of billions of dollars, plus or minus? a largelyt is political question. it will be roughly the same magnitude because that is the way congress thinks. if we raise the caps on one side, they will be raised on the other. that doesn't mean it is the right number. but on both sides, we need to think about what we should not be doing. as we invest in the things that are high priority. my act, i'd love to get your general reaction to the conversation but also interested in how you would prioritize your major economic concerns for the country, looking forward. maya: thank you. nice to be with all of you. i will do but somebody does whenever they follow alice rivlin, which is pretty much reinforce everything she just said.

i will start by saying, i love spreadsheets. i love them so much, my favorite gift of recent years has been from a colleague who gave me a coffee mug that said i love spreadsheets. i assume that was custom made. another colleague ran out and got an even larger coffee mug that said i love spreadsheets more. that is how fun it is where we work in the budget world. that is how we think of things. certainly, when you're talking about security policy, it's a great reminder that that is not where you start with the question of the budget. the budget should be bottom-up. you need to look at what your priorities are and figure out what is important. that is most true probably in the issue of security, where the last thing you want is budget experts telling you what your security number should be. you want to think through your security threats, long-term investments, come up with your security budget, and budget responsibly around that.

i also think that is true for the rest of the budget. we need to think about what our national priorities are, prioritize them, establish which one we are willing to pursue, and then from my perspective, think about how to pay for those things in a fiscally responsible way. now,infrastructure right there is a broad-based agreement, and there is a good -- there is a broad-based agreement that infrastructure is an important priority. we'll get into politics and what would happen under the next president. washere was an area that most likely to move first, that would be the area. when you are also seeing is the one-upsmanship that will happen in infrastructure. i think we should spend as much on it. somebody else says i think we should spend twice that. we want to spend 100 times more on infrastructure.

part of the discipline process is what we want to spend the money on, evaluating it, looking at the returns, and thinking about it as the overall objective of the budget, which is growing the economy and doing important things to meet the needs of people. economic growth is critically important. i also think bringing a lot of issues of economic security, which we are hearing a whole lot about in his campaign, are very true and real. all sorts of policies that we need to think about that reflects the change in the economy. the pace of change is so much faster than anything we have seen and we have not updated our social and economic policies to reflect the changes that people are going through. contributedat what to growing the economy in a fair way as well. you also have to think about the fiscal piece of it. where we are fiscally right now, you would not know it from the

headlines. there is a whole lot of talk about how deficits have come down. read the recent cbo report knows that they are coming back up again. this is quite predictable. whenever the pressure comes off, congress started borrowing more and more, and we put in place legislation last year -- we had a budget that was supposed to save over 10 years $5 trillion and bring us to a doubt budget. i would argue that is probably an overaggressive goal. i think that is backed up by what congress did, pass legislation to add another five chilean dollars to the debt. there is a whole lot of questions about how you are going to do with the fiscal challenges that not only are reflected in the growing deficit, but the fact that right now, our debt is a near record levels. relative to the economy, the highest since when we came out

of world war ii. and it is not as important as where we are today. we are still lucky. even when we mess up the global economy, people come here. we are still the safe haven. that gives us an incredible luxury to get a hold of these risk of problems in a gradual derail thell not economy. so we can put in place longer-term plans that would get control of the record level debt, deficit, but we haven't. so what we have today is looking forward a debt that is growing faster than the economy, that is the definition of unsustainable, interest payments that are the fastest-growing part of the budget, even faster than health care. this is an incredibly vulnerable situation to be in. and we are not borrowing for smart investment. we are not borrowing for things that will help grow the economy over time. what i look at is the path that we are on is completely

unsustainable, does not make sense, does not think about our priorities as a starting point. i come to the frustrating conclusion that many people have. in many ways, this is a reflection of a broken governance system right now. that refuseparties to work together, even when they have shared objectives, shared priorities. they do not even disagree on the way to fix things as often as you would think. i often think there is an agreement in congress but they still walk away from the table. but there is an inability to work together on any of these problems together right now. i would summarize by saying, we have taken the easy way out. the brokenness in washington has allowed us to allow the ester to hit. it was created because it was a policy that was so stupid congress would never let it go in place. it was supposed to encourage more responsible choices on the big picture situation.

oops. they let it go in place. instead of replacing it with something else, coming up with the appropriate spending levels, when we are spending more on discretionary and getting longer-term control of our ,vents -- entitlement programs reforming our tax code in a way to make us more competitive, grow the economy, and raise more revenues. instead of doing that, we let the sequester hit. ,ow we are governing by default only making choices when we have to, when there are action-forcing moments. really overly focused on short-term priorities. there is no long-term focus. this was your point. we need a longer-term set of objectives, longer-term budgeting, and put in place some kind of stability so you can make choices about security policy, economic policy, dealing with income insecurity. all the big challenges that we

had. you cannot change if you -- you cannot make plans if you don't know if the sequester will be there or not. these are basically two-year plans. there have been times when we are budgeting for three months at a time because congress cannot figure things out. and when we do the deals, they often rely on huge budget gimmicks, oco being one. the good news in all of this, if ,e start to make small progress you start to see built on trust, better policies, more security, more certainty, and a whole lot of upside in the economy. you are not just doing this because fiscal responsibility is the right thing to do. you do it because it helps to contribute to a thriving economy. now we have to figure out how to get that done. my last that leads to question which i will ask you each one of you to comment on.

it is the issue of, would it be tolerable to have a revision to the budget control act by the congress,dent and whereas the cap's go up a bit, we find a way to pay for them, but they go up by smaller numbers, $20 billion, and that becomes the new cap, roughly 5% increase from where we are now. similarly, on the domestic discretionary side -- whatever the number is. is it acceptable to have a revision to the budget control act that keeps the basic mechanism, basic numbers in broad terms but just pluses up the discretionary numbers, or do we need to just get rid of it and have a whole new fiscal plan for the country? probably all of us would agree that the latter is better,

although i want to hear how you would react. it gets to the point of political practicality. which ever is better, would it be also tolerable to have a revision to the budget control act, if that is the best we can get? certainly, if that is the best you can do, you want a revision. when both sides cannot live with either the fence cap sword domestic discretionary caps, is to start with reasonable numbers. offsetting the cost through reforms in other areas of spending would make sense, if it is not another two-year deal. the short-term deals to so much damage. what i really think is important, we need to do this bottom-up. it does not need to be done like this over and over, but you need to think about the actual priorities that you want to spend money on. that, you never have the chance to get rid of some of the inefficient spending which leads on forever in the

budget, because we don't spend time thinking through that piece of it. i personally think spending caps at the right level makes sense. there is no actual right level, so it is a level that people can live with. the disciplining notion of a cap is useful. i think it should be paralleled on the revenue side. this is about spending and revenues. but what worries me is when you have caps on the discretionary side of the budget. think about how easy it is for a policy maker to say, all we need to do is put in spending caps and live by them. they had not told you a single thing of what they would cut. and a small portion of the budget, not the portion growing, and they made it sound simple and free. we will put a cap in and the budget will fix itself. a budget is about trade-offs. you need to say what kind of policy changes you would make to live within those cats, and then keep them as a disciplining process, so you have to go

through your agencies and figure out what is better spending. an arbitrary cap does more damage than none at all. bob, would you want to get rid of it were could you live with a revision? i agree with my, you need a disciplining process. , in thert to decide case of defense, when you want to spend, should be bottom-up. in fact, it partially is right now. many of you participated in this process. the president picks a number in the beginning of the planning process, revises it later in the process at defense. in between, there is a great deal of bottom-up effort which is a-based, as best one can. there is never a simple calculus. i think there is a bottom-up process, absolutely important to

-- and my book tries to look at it in broad terms. cap.e end, i would keep a i think discipline is important. whether we need cap's, we also need more debate inside the discretionary portion of the budget. maybe i can set up alice by quoting an idea that she had, which i thought was good, which is that congress should start appropriating for the entitlement portions of the budget. right now they're on automatic pilot. at least it would force them to debate what are growing portions of the budget. yes, we need caps, but we need them higher in the case of discretionary spending. we need to do something analogous in entitlement portions of the budget. i think revising the budget control act depends of course what you mean, but revising the budget control act

is a mistake because the act was a mistake. it does not relate to the problem of the whole budget. the you need is to scrap attention that is being paid to discretionary spending, which is after all, less than a third of the budget. it, butt i am against the notion of revising the budget control act just keeps the focus on this one third of the budget, which is not where the focus ought to be. it is not what is driving the long-term increase in debt. i think we are all saying the same thing. repeal revise the bca, it, and replace it with a thater budget process forces the congress to think ahead and several decades

, about what we will do to put social security back on the firm basis. that is not a very hard problem, but it needs to be done. what are we going to do to control the cost of medicare and medicaid, so that we can make a decision every once in a while about what we want to do? that is not to say we want to punish old people. we want to think through what is the appropriate amount to spend, and the way to do that is to say here is what we want to spend, we will review it in five years. if we are off the track, then we have a decision to make about what to do. similarly with the tax code and tax expenditures, we spend an enormous amount in the tax code on things like housing, other things that we are not spending terribly well, and we never get

a chance to review it. . would not just revise the bca i would say repeal it, and put that something that deals with entitlements, so-called mandatory spending, the tax code, including tax expenditures. michael: some of you would have a similar question, but i wonder if the only counter argument that i can think of to what you are saying is that you are now requiring reform in a number of politically contentious areas. put that together, you don't have a new bill to agree on everything, so do we want to somebody can agree on tax reform? democrats have wanted to raise rates on the wealthy. republicans traditionally do not. are you setting yourself up for paralysis? alice: that is how we got where

we are. we have had paralysis for quite a long time, and that is leading us in the wrong direction. it is probably a total brick down in any budget -- breakdown in any budget consideration of anything, worse than reconnecting the budget control act. we will take to questions at a time. wait for a microphone, identify yourself. you can address the question to one person or to the panel. seventh row. the very nice tie. >> [indiscernible] you mentioned oco for the

department of defense. i wonder if you have any comments about the use of oco for state as well in defense? for thend question entire panel as well, you recounted the use of oco, the use of supplemental before that in afghanistan. we just reprogram the money. we do not have a mechanism for dealing with unanticipated major contingencies. as you said, the department of .efense likes to plan ahead afghanistan in 2001, iraq, these do not fit into the budget planning. do you have ideas how we could handle those more effectively than we do now? one last comment. instead of automatic budget cuts, why don't we just have automatic tax increases if the budget cannot be balanced? michael: one more, and then we

will go to the panel. >> larry with accountability central. i would like to come at this with a different angle, from revenues. i did some research recently on the irs. they came up with a report that a combination of unreported income and uncollected income from 2006 two 2010, every year billion.about $400 that is a huge amount of money when you are talking about $30 billion in raising the caps. a lot of that is because of the unfairness of the tax code. i think that is something that needs to be addressed. the other thing that will make the problem even more dire is the fact that the iris budget is being cut by 17%. it is not only the perception of unfairness, it is the perception

of enforced audits. .t is a crapshoot the odds are more in your favor every year as long as they keep cutting the iris budget. if we look at it from a revenue income position, we might not be having the situation we are in now. michael: let's start with bob and work down the panel. and state is a lot smaller, but as a percentage of state come is larger. in some ways, it is more important to state. on some issues, i'm less familiar on the details. i think department of state dod needs ocot as , so that it can finance wartime needs. i suspect there would be the same practical problems getting rid of it, that is the state department budget would have a great deal of difficulty in absorbing those amounts. i think we would probably need to keep oco four states.

in general, probably not enough money on the department of state , too much on defense, not enough trying to prevent war and negotiating, too much getting ready for it and fighting the we have to. ,n terms of unanticipated needs if it really occurs in the middle of the year, you don't have much choice to move to an emergency supplemental. congress is quite good when something serious happens. 9/11 is certainly an example. they made money available within days in that case. the oco mechanism should be maintained. it has gotten a bad name because it has been misused, but it has served the department well. that allow the department to make sure people in common have the resources they need, and that has to be critical. forink we should keep oco state and the department of defense, try to restrain its use to just things directly related to wartime requirements, and for

truly unanticipated needs midterm, we will have to use emergency supplementals. maya: i will make a quick comment on oco which may or may not be right, so if it's wrong, correct me. i think, given where spending could allegedly fall into oco was going, it may increase in the coming years, so there may be more funds spent on isis or other things that can go into oco. if that happens, that will put some of the pressure --assuming will putnot grow -- pressure back onto the caps. i just wonder where that is headed. contingency budgeting is a critically important thing, and i will completely over simple five. anyone who runs an organization -- you think about how you want for civility in your budget, so as opportunities or threats come along, you can meet them.

we still do not do that well enough at all in terms of our budget. you can see that from fights going on right now, whether it is natural disasters, health care threats, we need to do a better and more systematic approach of building into our budget crisis funds, things that you don't expect, emergency funds, that are a certain share of your budget. you know these are the likely cause that will come but you don't know where they are. and you have that paid for. , itthing that concerns me should not just be an excuse to not pay for something, just because it is important. there is a huge emergency. it is critically important we get funding to it. we should not have a budget that is built so that we don't pay for it and borrow it. instead, we should have budget and resources for those emergencies ahead of time. on your question about revenues, it's an excellent question.

the sequester, there was a judgment call that was made. because you would include in the sequester across-the-board cuts to defense and domestic discretionary, both political sides of the aisle would not want that to happen. presumably, republicans would be worried about defense cuts, democrats worried about discretionary, to overgeneralize. they did not put revenues into the sequester, i assume, because it was too hard to include them. i think that was a mistake. atdid an internal commission the center of a number of years ago, and we had a plan where you would have debt targets that you would have to get to, so that it was coming down relative to the economy. if you fail to get there, there would be across-the-board spending cuts and revenue increases. it was many of the republicans that were a part of the commission who said you need to have the revenue increases. that is what we will not be able to tolerate. we will not let the sequester's hit.

but the lesson of sequester, there are two models. you fill it with bad that lawmakers will not get it in place. we have learned that we do not know how to make it bad enough because we allow them to be in place. the other thing when you built sequester, that you build ones that are pretty decent policy that went -- if they wanted to place. smart triggers. if the government did not act place, trigger went into for instance, thoughtful reform to social security that would look at how you change benefits and a progressive way that would help the system head back toward solvency. if we are going to let those go off, it might be better to have smarter triggers in place. alice: back to unforeseen emergencies, there has been a bit of progress in budgeting for things like forest fires, floods

. that happens, and you ought to be able to budget for a significant contingency fund that allows you to spend when those things happen. it gets reconsidered every once the emergencyt legislation to which everyone attaches their favorite spending .rogram, calls it an emergency but as bob said, if you have pearl harbor, 9/11, you are going to have to do something really special. side, yes, if we are going to have sequester's, revenue should be in them.

but it comes back to my basic point. we should not be budgeting with gimmicky stuff that forces us to do what we ought to be doing , here are some big problems, let's sit down together -- we the republicans, we the democrats -- and figure out what to do. that is what we are not doing. we are not talking in bipartisan groups on the hill, between the hill and the white house, on how to solve the problems that we have. until we start doing that, all of these gimmicks are going to be just unfortunate ways of coping with something that we are not doing. maya: none of us answered the tax cap question as well. alice: absolutely. if the irs had more money to do audits, we would be collecting more taxes.

to do had more money audits of the medicare and medicaid programs, there would be less medicaid fraud. and that is not trivial either. me that doctors are willing to put in false bills, and there are places where they are, and they collect a lot of money. nobody goes after them because the budgets are too constrained. somedod does have contingency money appropriated for humanitarian disasters, which congress monitors. if it is spent, they add to it. there is some flexibility. although i never would have said it as a dod comptroller, but there are relatively smaller

contingencies in the operating budget where you can move money around. libya is a good example. we spent a couple hundred million in operating cost. for a supplemental, the white house was unwilling to do it because they did not want everything attached to it, but we found a way to find the money. for smaller items, the size of the department's budget gives it some flexibility, although i would have disavowed that statement aggressively as a comptroller. michael: a couple more this round. these two >> thank you. i am elliott horowitz. it has only been 43 years since i took a phd in economics. first, i want to congratulate dr. o'hanlon on his article. i would like to ask panelists about inequality. inequality has grown significantly in our economy the last two decades.

if anyone would like to comment, i would appreciate it. >> then we will take another. >> thank you. john harper was "national defense magazine." on what the presidential candidates have said so far, what level of defense spending might we expect from a clinton administration reverses a trump-- reverses a demonstration? like to, thatuld i had a co-author. one of the things we felt strongly about is the army has been cut enough. the army today is smaller than it was in the 1990's. terms, it hundred thousand or so under ronald reagan, who was cut to about half a million under the clinton

administration. it went up a little during the wars in the 2000s. now it is around 450,000 active duty. around 500,000 guard and reserve combined. the whole army is still around 100 million. but that is substantially less than the cold war and less than the 1990's. that is one area we see an argument in modest increases in spending. by the way, so you do not think the traders is about eating up his service, much of the article "halfs coined phrase was airpower, half intelligence," which he credits for the success we have had in recent years. on the issue of trump versus and defense spending -- there are important differences between those candidates. i'm not sure this is one of them. i do not know that there is any great specificity in either candidate's defense platform.

i think both would like to argue they are improving the military. trump has called it a "disgrace." i think he is used rhetoric that does not hold up. but in fairness to trump -- which i do not often use that phrase -- it is a time honored tradition to identify problems of the military and exaggerate or emphasize them in a political campaign. sometimes, good comes from that, because you get people to focus acutely at the shortfalls that always exist, even if you have a generally well resourced military. when i put all that together, i would expect either one of those potential presidents to spend a bit more than we are spending now. to advocate a military if it larger and more offensive than -- more expensive than the one obama prefers. that is just a guess, because as

you know, this campaign is not producing quite as many specifics on every policy issue as we always get. let me speak to the inequality point, which is an extremely point, and probably we should all emphasize early. we have had over quite a long iniod very serious increases inequality, which is hardly at the top. in a lot of attention has been paid they are, to the 1%. i think there is overcompensation of high corporate executives and of the financial sector. in the that is fixable tax code. some of it is hard to fix. the more important problem is what is happening at the bottom.

it is average wages falling behind. whoparticularly for people are limited in education. that is not easy to fix, but it is fixable. we know a lot of things that will help. we can invest in the skills and -- of everybody, but especially in those who have low skilled and are coming out of either difficult circumstances or have as the economy changes. not throw down change. the idea that we can stop the isld and globalization fanciful. we need to be managing change. the people and finding opportunities for people who are there -- either

by trade for technological trade, or anything else. to give them more productive futures. maya: first the question about the candidates. one of the things we have done is done a tally, a look at the candidates' proposals and look at how it would affect the national debt. i encourage you to go to our website and look at it. we are still looking for someone who has a plan to deal with the debt, because it does not exist yet. but there are some significant differences. on the area of defense, there just is not the specificity at all to figure out what would happen to the budget under either a president trump or a president clinton. trump has made comments, but both have said that we need to do more. both can be true. i think it is important about budgeting.

that there is probably every area were you should be spending more in some places and less than others, but there have not been any specifics that have allowed us to come up with a cost. likewise, hillary clinton has said she would like to get rid of the sequester and would like to pay for it, but she has not said that she would get rid of it, and she has not talked about how she would pay for it. medium, and low estimates. that she, we estimate would get rid of the sequester, and sometimes we do not. question of income inequality, this may turn out to be one -- i believe it will turn out to be one of the most important issues of our time. a lot of times, you about issues, economic issues, affecting individuals. there are a lot of things people will talk about. poverty. economic mobility. economic security.

economic opportunity. and income inequality. for some reason, income inequality is what people get most nervous about. a lot of times, you will hear people say it is not about income inequality, it is about mobility. but he has gotten bad enough that it really is about income inequality and all of those other things. there are different policies you need to meet those objectives. one of the problems that income inequality is leading to in this country is we are supposed to have an economic system based on systemnd a political completely separate from your economic situation. i worry you are seeing cracks in those. we are in a fast-paced, changing economy, where it takes money to make money -- income inequalities are exacerbating it. that is a problem. you are also seeing it influence the political sector more than it used to, and in new ways. you are seeing the consolidation of income wealth is leading to

consolidation of power. these are huge structural issues in our country that go to the fair -- the core foundations of fairness. we are just scratching the surface of what we will do about them. having watched defense budgets now for more than four decades, my sense is republicans would start a little higher, debate between threats with concerns about deficits, and then go down. democrats tend to go the other way. in the reagan era, you saw that have been. congressd high, brought it down. the democrats started to -- 10 to start low. and then as studs and concerns come up, it goes up. i guess they will end up in roughly similar places. given the threats to security now, with -- it will be finally

higher than where we are now. >> let's do another round. i want to make sure i use the back of the room as well. but we will start in the second row. you guys in the third and fifth throw, we will come back. yes, sir. i am hank gaffney, 54 years in defense. one thing i have not heard -- when talking about debt, i read all of the articles. ofare entering a period secular stagnation, or are deep into it, and do not really know the way out. i the same time, interest rates, , and it7% on bonds looks like it will be that way for a long time. i heard then bernanke, in a brookings -- i heard ben

bernanke, in a brookings session, note that the national debt would increase to 77% over the next 10 years. i am not sure with the big problem with debt is. michael: we will do one more question. reporter fromrk, "governor executive." question for mr. hale. do the pentagon lobbyists and planners restrict themselves to what the defense budget ought to be, or do they take note of the fact that it is linked to domestic spending and revenue? is it kosher for them to get into that at all? michael: let's start with my and alice -- with maya and alice on the debt and then go to bob. maya: no surprise, everyone that theyorrow things

won it to borrow before. so what happens when there are emergencies and other things, everyone changes the story for why they want to do what they want to do. but there is some merit to the argument. the where people selling free lunches. because they are -- there are rarely free lunches when budgeting in the economy. there are a lot smarter things we can do. but we cannot fix all of our problems without actually tackling the basic trade-offs that comes from budgeting. what i do think we have on our side, because rates are so low and because we are still a safe haven, is not worry about our record debt levels today. not look at our budget and say "we need to cut spending and raise taxes immediately." but say "we still have faith in our economy to deal with the fact that growth is not what it could and should be and put in place policies that will help get growth up now at the same time we put in medium and

long-term plans to get our debt back down." part of a conference of economic how to grow the economy. one is to not borrow too much. there are arguments that are compelling that excessively high economic debt slow growth. so you want to put your economy debttrajectory to get that growing slower than the economy. you can do those together. put in place more spending, tax cuts, if you think it is the right thing, in the short term, as long as they are offset in the long term. the biggest issue is what you spend on. i think the argument you hear about is infrastructure. "let's borrow from if the shutter" is let's borrow for things that grow the economy. infrastructure is desirable because it has long-term effect and short-term job creation.

jobs that tend to have good wages. but the problem with the argument that rates are so low, we can just borrow is we have already -- we have been borrowing so much for consumption, for things we should not have borrowed four, that we have kind of used up a lot of the borrowing space. if we had a budget where we pay for the consumption items but borrowed for the things that were actual investments, that would be a sensible budget. what is not sensible is to borrow for your consumption and say the rest is investment, so i will borrow for that as well. if you already ready borrowed for your spending splurge -- it is hard to say i borrowed for college when you have been borrowing for major shopping trips for years. the final thing is i encourage people to think about this issue -- the congressional budget office came out with a report that shows spending in infrastructure is a good place to make investment, but it would help grow the economy more if it

was paid for over a reasonable amount of time. it is like tax cuts do not actually pay for themselves. borrowing for infrastructure does not pay for itself. you have to find a way to pay for it. the because rates are low, we have a longer time period in which to pay for it. alice: let me address what is wrong with the debt. why we should not just have lots of dead. i think two things. one is you do have to pay interest on it. the amount of debt dedicated to debt service is not -- is rising rapidly. , because not huge interest rates, at the moment, are so low. i do not think we can count on that forever. if you think about what a very large debt with even moderate interest rates, as we have , does toed in the past

the federal budget -- you have to pay the interest on the debt. you have to pay that off the top. that means you cannot spend as much for all of the other things debts.d to do, including that is a risk. not an imminent risk, but definitely a risk. way back at the end of world war ii, we actually had a larger debt in relation to gdp than we have now. but we owed it all to ourselves. now, the holders of u.s. government debt are all around .he world governments and financial institutions and other places. the chinese, oil-rich countries, and others. that is a vulnerable position to be in.

thei think the problem with recruitment argument is it is a one-sided argument. i agree that we ought to be spending a lot more on investments that will grow the economy, but i think we can do that at the same time that we run in the longer expenditures on consumption, primarily for the elderly. that he should not be growing as fast as it is, and not growing faster than revenue. and we have to fix our tax system. argument, the thinking is you can only concentrate on one thing at a time, and the only thing you can concentrate on is growing the economy at

investing. i think you can do both at the same time. ishael: can i follow of -- there not even a third argument which is if we have another economic downturn and start at 75% debt, our ability to get through that without running the risk of losing a lot of foreign investment and driving the debt up to preposterously high levels of sacrificed? alice: yes. look at what happened in 2008 pay we went into the financial crisis with debt levels that were quite moderate. 35% -- under for percent of gdp. just because of the recession, we ended up in the 70's. we cannot do that again. maya: and to add onto that, the number you said was that the debt would grow to 77% in 10 years. it would actually grow to 87% of gdp the next 10 years. if we do nothing, from the new cbo numbers, we are on track to

trillion the next 10 years, and the debt will grow more than 10% of gdp. that is before you have unpaid for priorities. in the point mike brought in his this is not about fiscal flexibility. we were able to deal with 2008 because our debt was in a healthy place. if the business cycle is a normal length, we are closer to the next downturn than the last downturn, and we are not in good shape to go forward with that with our debt where it is. so it increases the it interest rates? bernanke says that as well. not about the cbo, but about projections of interest rates. the other piece of good news is health care spending increases have come down.

so we are not in as dire as situation as we were six years ago. but we have more time to fix it. that does not mean we should ignore it. cbo: and in the newest report, interest rates were projected to be lower. that made the deficit slightly lower. the reflections of more dismal projections about the economy going forward. so lower interest rates are not necessarily a good thing. they are good in the immediate budget reflect, but it is reflecting the fact that we do not have confidence that we are growing the economy the way we should be. regardless of interest rates, it is preparing for the next economic downturn that people have been identified. and so pentagon officials talking to others. first, please do not use the word "lobbyists."

in the pentagon, it is illegal for federal employees. but they restrict themselves from talking about the defense budget. there are exceptions. bob gates spoke out publicly, but for the most part, they restrict themselves. that is not mean they do have a debate. is to lay outjob for the president and senior advisers alternatives, defense and nondefense, and the president's political advisers would certainly be discussing it. but pentagon officials generally restrict themselves to defense. michael: i want to add a note on that. then -- ben bernanke's name has been tossed out a couple of times. he made the excellent point that much of the cold for -- cold war, when defense spending was 6% to 10% of gdp, defense had a

default science -- we do not think of it trying to build our future domestic economy, and americans surely to pickwant to have winners, but implicitly, we put a lot of money into our long-term economic foundations, which spilled -- spilled over into the domestic economy. but if defense is only 3% of gdp, you do not have the same magnitude of effect. have to think about science and infrastructure strategies deserve more attention directly focused on them, because they are not getting it from spillover in the defense sector that they were before. was the theme of the conversation for a while. so we will go to the front. germany the third row and then the fifth. i am a union officer, and i think the real problem is

getting stuff through congress. even when you talk about infrastructure, there was a gasy today on npr about consumption being the highest ever because prices are so low and no one is willing to increase the gas tax. the budget control act, at least from the perspective of inequality and domestic spending, was set up to protect the domestic discretionary budget. that is why until congress is responsible, we still have to have a budget control act. o, we want that to be as low as possible to increase the ceiling for the budget control act, to the extent we still have the act, so we can increase domestic discretionary spending. thank you. michael, you have talked about reforms, and alice as

well, platform services, retirement, accounts that would make the military more efficient. is there a trigger to induce that? levels, weent budget are perhaps not investing too much in retirement. thank you. michael: maybe we will take one more, because the first was an eloquent comment. right here. >> yes. tom olson. a lot of european countries spend a lot less money on defense, and on medical care, and they seem to and, somewhatlity say, better lifestyles than america does.

so what would happen if we started to spend a lot less on education, medical care, and defense? our economywouldn't suffer from that? michael: i guess we can work on the real. briefly -- bob hale will want to comment, i am sure, because he saw a number of proposals by the pentagon to congress to make modest reforms in personnel accounts, and they often did not go far. like the base closure proposal did not go far. there are a number of reasons, some valid. that we realize we were asking a lot of our men and women in uniform. unless you could project a commitment to sustain good compensation, people could easily get nervous that we were not being fair to them. i think the obama administration was fair to them, to be clear. canthe politics, obviously, be difficult. on retirement reform in the military -- most people here

probably know that we have the old-fashioned system of you do 20 years, you get a nice pension. if you do 19.5 or less, you get zip. i do not think that is fair. my first concern is equity and fairness more than saving money. there are commissions that have looked at ways to save money, recognizing that retired officers make a pre-nice pension. out inut -- many come their 40's, and there is room to rethink those pensions. but we should at least give a modest 401k-like benefit for the person who did eight years and got out and may not have as good an economic path going forward. medical, i do think you save a little. maybe a higher copayment. hasthe difficulty -- bob seen the difficulty of getting even modest proposals through congress.

and looking at nuclear weapons might be more economical. tactical aircraft. if you put a number of things together, and you get base closures, you may be able to get several billion dollars in savings that are sustainable and stay at that level. you will do well to approach $10 billion in the aggregate of those reforms, which is why i still favor a modest increase in the defense budget. alice: i would subscribe to the importance of pension reform. and i think there is savings to be had, and improved care, in reforms to the dependent and retiree health care. let me get to the question about other countries, because i think it is complicated. spends a loteurope less on defense. that is because they have us to

defend them. and they know it. so i do not think that one counts. they do spend less per person on spend care, but they more, in general, on social services, children's allowances, early childhood education, and social support, which is part of why i think they have less inequality. do we spend so much on health care and never seem to be able to have satisfactory assistance is for a lot of different reasons. we have a complex system with very high administration it costs. and we compensate our health professionals extremely well. especially specialists to you we use more specialists. there are other reasons, but it is a complicated question.

and just saying "if we spent less, we would have more and it would be good for our economy", it is not clear one way or another. bob: i think this administration has had some success. congress did pass a modest reform in the military retirement system that provides a 401(k)-like vision for those -- lesss to money and than 20, and slightly reduces the pension for those with 20 or more. co-pays, forring example, congress actually mandated the use of mail order. dod needs to continue that. they only to themselves, because they need the money. they over to the public, because there are options for further reform.

hopefully, congress will cooperate. the history is if you keep trying, they eventually will. i think we will eventually get reform. they are running out of reasons to say no. we will see if the next president and secretary of defense pushes it. so there has been some reform. it needs to continue. michael: one last round and we will wrap up. the gentleman in the far back who has been waiting generally -- patiently. inn -- are my women friends the room only going to make me call on men? go well. not so going once, going twice -- we will go to these denman up here. then he will answer everyone's questions. >> one really technical question. when i think about debt structuring in the united states , we did away with the 30 year yearsr treasury debt some

ago. with interest rates this low, would it he a good thing to bring that back? my second question is who is everyone's secretary of defense nominee? [laughter] i have a quick question. it has been mentioned several times that we need to revise the tax system. can we get some specifics? i was wondering how unified should the budget be, especially with entitlements? and should there be more and larger contingency funds? and like with dod, if you want to put an investment in place, you have -- a maintenance and replacement costs that are not in medially budgeted. michael: do you want to start, bob? bob: in terms of -- i will pass on the next secretary of defense. in terms of unification of the budget, i will give the same

answer i did before. i think the department needs to argue for their own. the president needs to hear of what theviews department needs. but he or she has to defend on places like the office of management and budget to bring alternative use of the balance. i think, in reason, that process works on its own. alice headed omb, so she can take exception. was free with their thoughts on alternatives to the president, which is as it should be. bob: so -- maya: writing about tax reform is brought in the base, lower the rate, and take some of that money to close the budget deficits. is swiss cheese. we have so many expenditures, credits, is regions, deductions

-- they are incredibly popular. we need to broaden the tax base, but when you see that's when he saved that means a homeowner interested action, it is not so popular anymore. there is significantly over $1 trillion in lost revenue at year. that is a lot of money we could make up by getting rid of a bunch of the tax breaks that get no oversight. they are regressive. they pay people to do things they would be doing anyhow. they are not shocked or in ways that are thoughtful, and we never look back over them. it is difficult to do. planof us came up with a that says if you cannot go through them one by one and make reforms, at least think about capping them. , relative tobreaks income, that people can get. that there would only be x

amount of your income in terms of x amount of dollars. while i think there are a lot of things we have to do to reform the corporate inform tax, i think we have to think of different revenue sources the country needs. i love the progressive consumption tax. i think taxing more of what you do not want to consider what you do want is a smart thing. consumption taxes can make sense, but they are regressive. so progressive consumption taxes, which are difficult to create but are nicer design. it is long overdue in this country. i think there are a lot of places we could go. the goal should be to increase the competitiveness. taxing the things we want to tax. and raise revenue. alice: i agree. let me underlying a couple of points. yes, the tax base is

swiss cheese. and there are a few egregious things that ought to be fixed, of hedgeing the income fund managers "carried interest which is some kind of extent that should not be taxed. that is ridiculous. it would help a little on the equality problem. but there are actually only a few deductions that make a lot of difference. deductions, exclusions. has mentioned,a the home mortgage deduction. it is a deduction, not a credit. so the higher your income, the larger your mortgage, the more it benefits you. that is ridiculous. we just went through a period in which we grossly overbilled high and housing in part because we

subsidized it so much. through the tax code. . it souse we subsidized much the the tax code. it does not mean we should not encourage homeownership, but you could convert it to a credit towards tax and design it so that it was not so costly and it benefited middle income people more and high income people less. that is a good idea. the other big one is the exclusion of your employer's health benefits from your income. which is a big incentive, to say, "i want generous health insurance from my employer, because it is not taxed, and i would rather have that than wages."

that is very unfortunate. because it leads to overconsumption of health care. people who benefit from that are the same people. high earners, particularly people who work for big corporations. so gradually phasing out that exclusion would make a lot of sense. michael: and as i think my speakers today and thank all of you for being here and your excellent questions, i will be fully answer this last question about who might be secretary of defense. [laughter] alice: are you a candidate? michael: no. but i will go to someone else who i think should be. i do not know who donald trump would choose, so i will not go there. but i do think people -- and in seriousness, people talk a lot defenseder secretary of michele flournoy.

i believe she will be an excellent choice. ashton carter i think is doing a good job where he is. assessment -- so if michele flournoy were not the choice of hillary, they may choose to stay with the current situation. if she does not go with those two choices, i think the guy to my far right would be a good choice. thank you all for being here. [applause] [captions copyright national cable satellite corp. 2016] [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit ncicap.org]

>> if you missed any of this discussion from the brookings institution, we will have it online. you can check it on c-span.org. a discussion on

sharing intelligence and counterterrorism, hosted by the center for strategic and international studies, starting at 1:00 eastern, here on c-span. at noon, join us live with a member of the turkish parliament on combating terrorism live on c-span three. and a discussion on chronic health problems and their cost, hosted by the alliance for health reform, also live at noon on c-span 2. looking at congress. house speaker paul ryan tweeted a video about his thoughts on the health care them in the u.s., saying consumers and patients should be the ones driving it, not washington. here's the video. >> either we have the government telling us what we have to do, where we have to do it, or, should to pay for it, or we put ourselves in charge. we as consumers, patients. do we want to be the ones driving the health care system.

do you want to be the ones where all of the providers compete against each other for our business based on price, quality, outcomes? that is freedom. that is a patient-centered health care system. the type of health care system we can and should have paid we can have a system in this country where everyone has access to quality health insurance, including people with pre-existing conditions. without a costly one-size-fits-all government mandated, government run system. if you want to learn more, i encourage you to go to bett er.gop. >> house speaker paul ryan. on the other side, the house minority whip tweets the house gop's reckless recess coming to a close in eight days. shameful that they have not addressed zika, the water contamination in flint, michigan, the opioid epidemic, and more.

here's a preview of the upcoming session. its summeraking break, the senate voted a second time to block funding to combat and prevent the zika virus. last may, when our democratic colleagues asked us to act, and act with urgency. but today, they turned down the that they argued for last may. and decided to gamble with the lives of children like this. instead of protecting them. as i said, they ignored their own calls to get this done quickly. and they have refused the past measures that would protect our country from a public health crisis. so as i said when i started, this is a test today, to see whether our democratic colleagues care more about babies like this or special interest groups.

they failed the test. it is simple as that. >> under the bill we got back that republicans in the senate approval happen in the house, planned parenthood, an organization where hundreds of thousands of women go for their care -- do you think they will have a rush of business now? because women in america today want to make sure that they have the ability to not get pregnant. why? because mosquitoes ravitch pregnant woman -- ravage pregnant women. friend,e logic of my the republican leader, they do not need to go to planned parenthood. they can go to their boutique doctor. some place in las vegas or chicago or lexington, kentucky. they can go to an emergency room and say "i am sorry, i did not get birth control, can you help me?" that is not what emergency

room's are for. that is what planned parenthood is for. the vast majority of women who -- that is where they go. planned parenthood. under the legislation we got from the house, there is no money to be provided for them. . >> this thursday, a preview of forbear major issues congress will debate. seeker of funding. defense policy. gun violence. and the impeachment of irs commissioner john costin and. debateill be a floor with susan for riccio. that is thursday at 8:00 p.m. eastern on c-span. ♪ announcer: this week on "q&a," author laurence leamer.

mr. leamer talks about his writing career and his latest book, "the lynching: the epic courtroom battle that brought down the klan." brian: laurence leamer, you are now an owner of 15 books you have written. why did you do books? laurence: i could not make a living writing magazine articles. i tried. i could not write fast enough, and i started writing books. i did not make much of a living for quite a while. but i kept at it. me, is the secret is persistence. brian: how do you pick your books? laurence: it is a stupid thing to do. i should choose an area and keep at it, but i wanted to do something much different. experience different lives. when you write a nonfiction book, you are thinking back in somebody's life. i want to piggyback on as many lives as i can. brian: of the 15 books, which one sold the most? laurence: "the kennedy women," by a longshot.

that was the number two "your times" bestseller. brian: why was that? laurence: it was such an incredible idea. my agent's idea about a multigenerational book about women. nobody had ever written a multigenerational book about women. to put women at the forefront just totally changed things. brian: what about the kennedy women do you most remember, and what did the audience want to hear when you talked to them? laurence: it was a book -- i suggested that you do not have to be a woman to love the kennedy women. because it was a book read by women. women of that generation read that book, and they just loved that it was their story, and they could all identify one way and another with the evolution of women in america. brian: you did a trilogy on the kennedys. laurence: yes. brian: which one came first? laurence: "the kennedy women." brian: 1994. then what? laurence: i went on to do other

things. i foolishly then -- i worked in a coal mine, earlier. when i was in magazine writer. in fact i broke my finger in the , coal mine, went back in. lived in west virginia in a trailer for six months. and developed a love for country music. so i went down and wrote a book about country music, which did not sell very well. then, a publisher came back and said we want to do a book, "the kennedy men," similar to "the committee women," and if you do not do it, we will find someone else to do it. that convinced me i should do it. brian: what was special about that particular book? laurence: it was the story of the men through the five generations, just the way "the kennedy women" had been the women. i was supposed to tell the entire story, but i did not. it got so long, we broke it in two. the second volume was the young generation that came after that. "sons of camelot." brian: did you get to talk to any of the kennedy men?

laurence: yes, and the women. brian: of all of those, who did you like the most, or who did you get the most from? laurence: mrs. shriver. mrs. shriver. actually, since we have an hour, i'm going to tell you the story. olympics, ipecial went to the minneapolis games, and i got in the car with the shrivers and spent the whole week with them. i did not ask. if i had asked, they would have said "no." i just hung out with them. i came back and i set up -- she agreed to an interview. and i have a journalist's soul. the phone rings, i'm going to answer the phone. every writer i know answers the phone the same way, on the first ring. you are so desperate to talk to someone. so the phone rang that morning of interview, and a know it is the secretary saying "no." but i have to answer the phone. so i totally panicked, do not

know what to do. what can i do? i knew this woman called kay haley, who gave this wonderful oral history for the kennedy library. i did not know if she was still around. i looked in the phone book -- there were still phone books. there she was, living in georgetown. i called and said -- "yes, i'd be happy. can you come over right now?" i said great, so i grabbed a cab, walked in. " would you like to see my churchill memorabilia?" "here is winston's cigar. here's a certificate." i said, this is fascinating. but i am doing this book on the kennedys, can we talk about the kennedys? "yes. how are the kennedys?" i said great. but i think the history of the family changed with the assassination of president kennedy.

"he's dead?" so, that was my day. brian: what year was that? laurence: that would have been about 1992. then, mrs. shriver did talk to me. and i became quite close to her. i would go out to the events that she would have over there. it was interesting, because we talk about the special olympics, which in my mind is the best thing the kennedys have ever done. changed our attitude towards those with intellectual disabilities, all across the world. not just the united states. and they started that in 1968. rosemary, rosemary kennedy, of course, who had the lobotomy in 1941, who was mildly intellectually disabled, and her father tragically wanted to be on the cutting edge and gave her this lobotomy that gave her the mental age of a three or four-year-old. they started the special olympics. but mrs. shriver was convinced that the special olympics had nothing to do with her sister rosemary.

and we talk about -- because i said, of course it is. i was made the mistake of calling her eunice once -- you don't do that. it was always "mrs. shriver." "of course rosemary had something to do with that." eventually she admitted maybe it did, but you cannot intellectually bring herself to do. but i think the special olympics should consider rosemary the cofounder. brian: rosemary shriver, where do she fit in with the family? laurence: she is an older sister, the second oldest sister. brian: what about one of the men you talk to? laurence: i talked to teddy. brian: how open was he? laurence: you know, he -- the tragedies remained an open wound to him his entire life. so you bring up his brother, and you think -- we have all had our

parents, we talk about our parents and much and felt so much about them. we do not tear up when we hear their name. but when you mention his brothers and their loss, it was very hard for him to talk. very hard for him. also, when i was doing that book, i also spent not thanksgiving day, but the wednesday evening before thanksgiving, i was invited to a dinner party in hyannisport at the kennedy home, with all the close friends. my wife and i were the only people that were not close friends that were there that evening. it was the strangest thing. even among intimates, everyone is kind of watching teddy. whatever teddy wants, they want. if teddy wants to watch the football game, everyone watches the football game. if he gets up -- and i thought, what a mad way to live. that even in intimacy of your home, people cannot be themselves. brian: why did they trust you? laurence: if people advise me on -- if people have asked me on being a journalist, what was the most important thing? i would say to have a good reputation.

you get this over time. and it troubles me when journalists live information, or dissemble. because it comes back to haunt us all. i have had a problem in some my books -- there like what about what he did -- you just have to keep your word. people are shrewd, they are a good judge of people. if i promise i will not put anything in my book, i will not, i will try. i also take my interviews as much as i possibly can. when i read a book, i can usually tell when it has been tape-recorded or not. or whether people just made casual notes and tried to remake it afterwards. that saved me from lawsuits. i was actually sued by judith exner, jfk's mistress. she sued me. and she sued me, because i talked to peter lawford's manager, who said she was paid to sleep with kennedy in las vegas when she met him during the presidential primaries. when she sued me she said, "i

, never said that, you made this up." thank goodness i had the tape and i quoted precisely what he said, and that really saved me. brian: what happened to the lawsuit? laurence: $400,000 later, it was thrown it. this is the tragedy of lawsuits, in terms of journalism writing books. yes, there is libel insurance, but there is a deductible. so that cost me $50,000. we won. it was thrown out at the earliest possible time. it cost me $50,000. thank goodness "the kennedy women" was a very successful book so i could afford the $50,000. it does not matter. there was a "new york times" reporter who wrote a biography of donald trump, said he was worth $600 million and trump said that was libelous, he was worth billions of dollars. he sued, it was thrown out. but i guarantee that guy -- this is not a bestseller. he had to come up with the deductible. so trump lost, but trump won in

terms of causing trouble for that writer. brian: over the years, how many different publishers have you had? laurence: it used to be you had one publisher forever, that is no longer true. i cannot even count how many i have had. i am now that with william monroe. i was with them 20 years ago. we are all mercenaries. you go wherever you get the best deal. nobody is loyal to anybody in america. corporations are not loyal to you, and you are not loyal to them. same with publishing houses. people move on. authors move on. brian: you live in washington, d.c. and palm beach florida. laurence: i used to hate people who lived in two places. i would see it in their books and think what a jerk they must be. brian: why do you live in these two places? laurence: i live in florida partially because -- i do not like the winter, and there's a big tax advantage of living down there. which i'm not making them much money anymore, it does not really matter. i like to play tennis, like to play year-round. and i work very hard.

and doing what i can do, i can work anywhere. brian: one of the books you have written over the years is a book called "madness." the subtitle is "under the royal palms, love, and death behind the gates of palm beach." which i have read and when i read it i thought, how does mr. leamer survive living in palm beach? what is the story? laurence: i had never been to palm beach before. i went down -- remember the willie smith trial, when he was accused of ripping this woman in palm beach? brian: a kennedy relative. laurence: a kennedy relative. he was the precursor to oj. there were hundreds of journalists down there, and i was one of them. and i stayed at a hotel in palm beach. and i thought this is the strangest place i have ever seen in my life. there is no life. you go down the shopping street. nobody is there, nobody in the streets, no bathroom on the beach. there is no place to eat if you want to get a cup of coffee or something. this is bizarre. and i thought, i'm going to get

a place here and write a book about it. well, we got a place. and i tell the story in the book. we get this condominium, and suddenly, everybody treats me terribly. i mean, they come in, i had a leak, and the people came in -- the board members, they would not sit down. no, they would not sit down. they were just incredibly unpleasant to me. i could not figure out what it was. so christmas rolls around, and my wife is the world's ultimate shopper. and we needed a christmas tree. she said the only place was boynton beach, about 20 miles from palm beach. so we go to boynton beach and here's the place we go -- a guy out of "deliverance." a 90-year-old guy. toothless guy. he kind of finds the tree for us. it is too big to put in the trunk of a car. so we strap it to the top, and i have to take the side roads. we are late, we were supposed to go to a dinner party. the garage is in the basement underneath the building. we are late.

we go down there. we are late. my wife says, just take the tree. carried the tree. and i said, i cannot carry the tree, it is enormous. she said, "grandpa carried a tree, why can't you carry a tree?" i said, "i'm not grandpa." my wife is 5'2". she says, "i will get it." so she takes the tree, hauls it off, takes it into the service elevator, brings it up to the floor. this is a very ritzy building. and all of these people in their black tie. and here's my little wife carrying this tree, trailing a down the corridor. -- ii realized what it was am not jewish. they thought i was jewish. thinks i am jewish, but i am not. i was brought up as a methodist. the reason they were so cruel -- and they were cool -- was because they thought i was jewish. brian: and they were not? laurence: they were not. it was a wasp building. i was totally outcast.

i am on theaside, board of the building. we have indian americans, jewish americans, french americans. we have all kinds of people in that building. it is a different palm beach now. but that is in my book. and the book is partially about the jewish world of palm beach and the wasp world of palm beach and how they have very little to do with each other. so one of the good things donald trump did when he bought mar-a-lago. when he bought this palace, during financial hard times, he wanted to build a bunch of big fancy homes on the land. the town did not like it. they would not let him do it. so he had dinner with a jewish lawyer who said listen, we have all of these wealthy jews coming to palm beach. club is a jewish country -- there's a country club that most of them cannot go to there. if we start mar-a-lago, they will all come and join it. that is precisely what happened. brian: we have all heard about mar-a-lago. i think i look it up.

what is that, "sea to lake"? what it means. what is it? laurence: it is one of the most incredible buildings in america. marjorie meriwether post built when noone of the times one wants anymore trump got it. ,build the club. if i had billions of dollars, the last thing i want to do is hang out with a bunch of wannabes. wannabes in every way. but they are there with him every weekend. people call, if donald is in town, the place is full. an they want to be around him. and he wants to be around them. this is before he ran for president, but even now he does that. it is funny, because i had dinner easter sunday at trump golf course in west palm. and it is a very fancy buffet they have. $100 a person buffet. and all these fancy cars are out there, very wealthy people.

they are out there getting the lobster and the fancy things. and i know better than any of them, and i go out to get a steak. i am standing there, waiting for it, and i looked to my right and there is donald. there is donald trump he wants a hamburger. he is the only person -- he gets a hamburger, he gets it cooked until it is charred, and he puts an inch of ketchup over the top. i thought, this guy -- he is a populist in his food, whatever you say about him. brian: have you talked with him? laurence: yes, i have talked to him. he was in my book. brian: i know, i'm looking at chapter nine. king of the new yorkers. it starts off, "the great donald might have been the son of a wealthy real estate developer , but the protestant mogul is the uncrowned king of the new yorkers." laurence: yeah. in his flamboyance, i mean he is it. brian: why do people want to live the way they do in palm beach, and would you describe why i asked the question? laurence: when i cannot figure out -- look if i had that money, , i would want the most

interesting people around me. i would want to have -- you know -- what is the point? -- laurence: what i cannot figure out is, if i had that money, i would want the most interesting people around me. i would want to have -- you know -- what is the point? but it is segregated in terms of its wealth. now i know somebody who has around $400 million. he does not go down there because he is not wealthy enough. ok? and so, you look at me and you do not think how much i'm worth, you do not care how much i were -- what i'm worth. ok? they look at you and know precisely how much you are worth so you are on their level. brian: how do you fit? laurence: i do not fit. i am the odd man out. brian: how do they know that? laurence: thanks to my book. when my book came out, i was driven off the road. the police chief said i should hire security. there is a video on youtube of someone screaming at me about what a bigot i am. all