but over time under cbo projections, as the population agencies and especially if health care costs rise above trend as has been historically typical, the country will face an unsustainable debt path in which debt-to-gdp ratio rises and that requires further actions. that's mainly related to retirement programs, to social security and even more important, to medicare and health care costs trends. and so we've known about this for decades. and there remain as need for action on this front. >> there does remain a need for action and signing those later cbo long-term budget outlook report on some of the consequences growing federal debt that comes from the cbo's long-term budget outlook. it cites things like less national savings, lower income, pressure for tax increases or spending cuts, reduced ability to respond to domestic or international problems and a greater chance for a fiscal crisis. are these things that you all consider at federal reserve with regard to monetary policy? >> i agree with the set of consequences that you just read to me. and ultimately when, when we see those thing

in june, the cbo came out with a long-term budget outlook for the u.s., and it is not pretty.t is where we need to focus. to come to a conclusion with our spending. joe: how do you see that manifesting itself? >> it is a long-term thing. you have the crowding out effect. you have the fact that once entitlement spending consumes the majority or all of revenues, then the additional funding has to be financed. your debt goes up. the market -- even though we are the safest, most liquid, bond market in the world, it requires a higher premium because the economy looks worse. that is how i would see this developing. it wouldn't be the next 2-3 years, 5-10 years maybe. alix: thank you so much. great to see you. joe: up next, who made the scathing remark about a recent "what'd you miss?" guest. we will tell you who said it after the break. ♪ alix: i am alix steel. joe: i am joe weisenthal. "what'd you miss?" alix: we showed you a quote that picked apart paul krugman's comment. joe: in an interview, he said that krugman is a prominent economist who won a prize for his trade theory, but

cbo told us it was $20 billion. it would make more money outside . that is the cbo role. we had to come up with 20 billion dollars. we will assess the financial institutions. three republicans -- that became too much so chris gets word from them that they cannot vote for the bill on the floor. chris announced -- told me that we have been told that we cannot do it. we had finalized the conference, inc. the gavel, signed the bill. there are no rules for committees. no one had had one in a long time. sen. dodd.: [indiscernible] rep. frank: i announced that the conference was reconvening. we entered the bill we had signed off on and took it out of extra tarp money. that was it. sen. dodd: i forget which member of the republican side made a suggestion and i thought if we can live with that we will have an ability to get this as barney pointed out, there was objections the financial stability counsel. the four becoming treasury secretary -- before becoming treasury secretary he was in the clinton administration. i want to mention the many things he has fought for that have rece

budgetest cbo long-term outlook reports on the consequences of large and growing federal debt.t cites things like less income, savings, lower pressure for larger tax increases or spending, reduce ability to respond to domestic and international problems and a greater chance of a this go crisis. .- of a fiscal crisis p do you consider this along with monetary policy? >> i agree with a set of consequences that you just read to me. ultimately, when we see those things being manifest, those consequences -- in the years ahead, if deficits are not addressed and become very large, they will put pressure on the economy. not right now but in future usrs, likely it will cause to have higher levels of interest rates than we otherwise would have come a diminished levels of investment, and productivity growth in this economy. we would have to offset those forces by having a tighter monetary policy. we are not in that situation now. >> relating to long-term let leading -- debt leading to a crisis, is this something you when yous part of fsoc look at systemic risk? >> i have not in part of an

we also developed and distributed a list to the cbo, community based organization. a list of job classification which do qualify for entry level positions with the city and we also distributed a list of potential city level internships to qualify for. that's kind of what we've done. we realize there is still more to do. once the outreach materials are finalized we want to go to our partners and do an educational forum about city employment with people with disabilities and we want to also look at developing and are delivering training to city employees awareness training about working with people with disabilities. secondly, i wanted to address in 2008, there was a recommendation to have a specific liaison with the community and since that time we have the department of human resources has hired ed wong who is here who is our city recruiter who was hired last year. this is one of his focus areas for recruitment and besides ed and myself we have one additional person, linda who also works with us. so there is three of us working part-time on that. this year the advis

that headlines, cbo warns of financial death spiral from debt first alliances forensic economic growth death spiral. one of the things that in your testimony here the council demonstrates vulnerabilities in the u.s. financial system. we take collective responsibility for threats to financial stability. and yet in your report, i don't see anything about that. am i missing something? >> i think if you look at the risks to our economy. we are at a much better position now than we were six and a half years ago, we reduced the deficit as a percentage of gdp and dollars at an historically quick rate, that report makes clear that over the next ten years, we're in a stable place i think the thing in that report that people are concerned about is the long term. and obviously there are still. >> that's not what it says mr. secretary. it says, the long term federal budget has worsened dramatically. >> i said over if the next 10 years, that report goes out far honor than 10 years i think the issue of -- >> we're going to -- a little blip in the screen here let me go back a little lower part of the

they employ a outreach coordinateed who arranging and conducts [inaudible] various hotels, cbo and other local businesses in the tenderloin and throughout san francisco. with these presentations and visit staff with interact with [inaudible] builds relationship and answer specific questions. to date for the 14, 15 fy year, 14 presentations [inaudible] all these efforts are tracked meticulously by jejer. when i visit i was impressed by her level of detail. she tracks everything she does, the fliers she gives. she does a soled job in outreaching the community. seek your approval for the grant enhancement and happy to answer questions >> comment or questions from the commission? hearing none, comment or question from the public? hearing none call the question, all in favor? opposed? thank you the motion carries. w, requesting authorization to modify the grant with episcicul community service during the period of july 1, 2015-june 30, 2018 in the amount of 75 thousands not to exceed 1, 033, 314. monty will present. do i have a motion to discuss? >> we seek your approval for the grant enhance

>> generally they are government employees or sometimes a lot of timeatize is a cbo's that we work with and sometimes it is financial institutions >> i just have a question, how much do the ministers or faith based communities are involved with training because a lot of ministers know about and that is the first person people go to, how much is they-are they involved in? catholic they may report this and [inaudible] how much are they involved in the training? that group- >> when people ask for trainings we had faith based organizations ask for training. i agree i think sometimes they don't know as much and there is a issue and have seen that myself but we do it if we are asked to do it. >> only if you asked? >> yes we haven't done a big campaign for that. i know >> i know, i just say there is abuse with the child and the parent and it is codependent. you don't want to talk to the parent because you say you are a bad parent because you are not raising your child and they are on drugs and the parent is in the home and the child is laying there. that is abuse but they are codependent on ea

this comes from the cbo's long-term budget outlook. things like less national savings, lower income pressure for larger tax increased or spending cuts reduced ability to respond to the next fiscal crisis. are these all things you consider at the federal reserve with regard to monetary policy? >> i agree with the set of consequences that's you just read to me. and ultimately, when we see those things being manifest those consequences. so in the years ahead if deficits aren't addressed and become very large they will put pressure on the economy that not right now but in future years, likely will cause us to have higher levels of interest rates than we otherwise would have had. diminished levels of investment and productivity growth in this economy. we would have to offset those forces by having a tighter monetary policy. so we're not in that situation now. >> particular lie relating to long-term death leading to a greater chance of fiscal crisis is this something you discuss when you are looking at systemic risk? >> i've not been part of

we are one of the cbo's wizard alternative to incarceration. the majority of our residents have a long criminal record, but they now wish to transform their lives, escaping poverty, addiction homelessness, danger, and prostitution. we are alarmed by the growing numbers of women who come to us who have mental health problems, including head trauma, recurring seizures, bipolar, hallucinations severe dissociative disorder. ptsd paralyzing anxiety and depression and drug addiction. also, what i've not heard mentioned here today is we have women come to us who have significant developmental disability. the women who come to us in majority has suffered long-term incest and other child abuse. the majority have been on the street since they were an average of 14 years old. we need -- we offer a conference of 18 month old unit and education program. including therapy, education, dental care, job readiness, many management, nutrition, substance abuse and self-defense and we do this at less than two thirds of the cost it would be -- we would encourage peo

the interesting thing when we enacted that law, we talked to cbo about that specific provision. getting in the middle of these negotiations, private sector negotiations to get drug discounts, versus letting the folks who do this on a daily basis negotiate the discount, the private sector. they said if you had that provision in there it would probably mess with the negotiations but you definitely wouldn't save any money. if you repealed that provision in law today, what cbo will tell you is it will not save a single dime. the reason is those pbms and those health plans are already negotiating the discounts and already being passed onto consumers. that's one of the reasons we did it. >> joel, going back to the first part of that question, someone sent forward a question on a card -- a suggestion, actually, after a long description of a situation to which it would apply. is it possible for providers to get access to health plan cost calculators so that they are able to inform consumers about their expected out-of-pocket costs before the services are rendered? is that a practical po

. >> a little bedroom than the cbo estimate, wasn't it? >> which was zero. it was $41.9 billion. go ahead. >> the cbo recognizes the value of the spectrum that clearly everyone else seems to know about. >> cbo was off. >> a little bit. >> but the fact is that was for a 12% increase in the available commercial spectrum. egot a you got a 12% increase and we're down to 688%, a long way to go to build out to meet the needs of people. as i said local communities often are saying no to these facilities. we have the business case has to be made in rural areas as we've discussed today. overall return on investment is very difficult with those prices for spectrum with the price on revenues. we're under pressure right now. we can't afford to have regulatory drag on these investments when there's not enough capital to meet these needs already. as slow as it is it's immediately available when it's built the take that same spectrum and reuse it. all of these burdens on federal lands in urban areas, the fcc has done a great job, the committee has done a great job of trying to address that but

rand stimulus spending and it has come down but the cbo says it starts back up we will be that close trillion deficits. >> so the payments that cannot be paid are entitlements plus the interest and we have promised to pay old people more money than we have and my a economic theory is that people anticipates that. with massive inflation. >> because we are the best horse in the glue factory ribeiro is not dead good bet nobody is buying the of approval so they're willing to lend money at a lower interest rate. john: theest ofhou rldis wor areokay >> at wll n la orev bu eryon ncree ds $1 illin to e del tohe wwillay ineresat rate that squeezes out all other investment. john: in 70 years entitlements and interest will eat all our taxes there is nothing left for defense or social programs. >> a government sends checks to all people with little or may we cannot do anything else. john: but older people vote terrified. >> and they're easy to scare face up to the fact for the yen on behalf whole ashley young people we have lied to them we can solve it by taxing the rich with there is not enough

that cbo volatility index, track the volatility in the s&p 500.t as high as 20 on july 9th as all the macro events came to a head, but then it faded and it faded fast closing around the 12 mark today. now, that means that what many called that fear gauge dropped by about 40% in just five days. and mkm derivative strategist jim kruger says that means stocks could be set for a nice rally over the next several weeks. meanwhile others point to the drop in volatility as a sign of market complacency. that means nobody's adequately prepared for a real market shock. still others are saying hey, let's use this drop in volatility to buy cheap protection against future market declines. regardless of your view here the steep drop in volatility has been one of nearly historic proportions. the vix certainly something a lot of traders have been watching especially given all the stuff with greece and china melissa. back over to you. >> thank you, dom. one man who's really been watching it brian sutland. he is is our resident fear merchant. what does a vix plunge

john: i talked about this with the bore the first day i became cbo. needed to look at how we can best position our businesses to be successful. we spent almost a year looking at it and came to the determination that while ebay and paypal still had synergies, skype did not. remember, we divested skype that at that time. but we agreed that every year, we would come back and look at ebay and paypal, and if and when we thought they could be more successful independently than together, we would act on that. last spring, as we did our forward-looking strategy process, by looking forward in what is happening in the world of payments and what is happening in the world of commerce, it became clear -- increasingly -- that particularly the world of through changeng and change that requires paypal to have complete strategic freedom to pursue its future and the world of commerce would allow ebay to be one of the winners. it was with a forward look we thought both businesses would be stronger and be set up to succeed over the next 3, 5, 10 years. emily: how much di

better than the cbo estimate. >> hopefully cbo recognizes the value of spectrum. >> the fact is that was a 12% increase in available commercial mobile sector. if you're a 12% increase in throughput and 700% we are down to 680%. a long way to go to build out to meet the needs of people and as i said local communities often are saying no to these facilities. we have the business case in rural areas as we have discussed today in the overall return on investment is difficult. we can't afford to have regulatory drag on these investments. slowing them down making it more expensive when there is enough capital toga to meet these needs already. that is where we are at in this country and as slow as it is it's immediately available when you see that same structure and reuse it. all of these burdens on federal lands and urban areas the fcc has done a great job in the committee has done a great job in trying to address that but we need to work with our partners in state and local governments as well. >> we have been grappling with trying to remove those burdens not just spectrum and a whole lot

and in 25 years according to cbo u.s. debt levels are projected to reach 156% of the economy which greece had in 2012. obviously if something's not changed the trajectory is as you can see similar. >> that's why something will be changed between now and then. it always is. we're not going to go over a cliff. we do collect taxes, unlike the greeks. and we don't quite have the labor laws that the greeks have. in greece you retire at the age of 50 if you're a hazardous profession among which -- i love this are radio announcers and hair dressers. not exactly sure what that means, but if you've been a hair dresser you can now be retired on a beach in the aiddriatic. greece is a third world economy in a first world club. what the europeans are worried about is not so much the default because greece cannot repay the debts one way or the other. this is a game of chicken where the greeks are trying to get better terms. what they're worried about is a radicalization of the other countries. greek elected a far left government which

cbo tells you how many uninsured as well.hat people need to do is, let's understand what all the specifics are. are you going to get rid of kids on their plan for 26? are you going to get rid of the consumer protections that have been put in place, things like lifetime limits, annual limits, or no co-pay for preventive services? when they say there is an approach we believe what we have in front of us is working. al: how does the ryan plan score? sylvia: i don't know that there is a score, and that is my point. we need to get to the specifics and the substance and what the substance will do. al: suppose for a moment the aca had not passed. comparatively, what with the health care system look like today? care, coverage, and cost? sylvia: with regard to questions of access, we've seen the largest drop in terms of coverage. access has been a huge part of what has happened. with regard to issues of quality, we have reduced the number of arms, things happening in the hospital, either false or other things that occur in a hospital

without -- from along with former cbo director, he is president of the american action forum. what is that reviewers they don't know it? host: [captions copyright national cable satellite corp. 2015] [no audio] a washington think tank. caller: good morning to both of you. i have one little pet people you put medicare and medicaid in the same sentence. i paid for by medicare for 35 years. medicaid is free basically and i you are cutting medicare benefits and taking the money from medicare when you're expanding medicaid. i live in florida. we spend more on medicaid than we do on the budget. iand florida don't understand with the money is supposed to come from. all the young people that were supposed to join and have not joined. the subsidies the government is . you estimated your income the first year and the irs is handling this. don't they know exactly how much money you make the year before? i don't understand. how shut up and let you answer. guest: so there are a couple of different things going on there. on the medicare front, it is true that individuals have payroll taxes

but over time under cbo projections, as the population ages, and especially if healthcare costs rise above trend as has been historically typical, the country will face an unsustainable debt path which the ratio rises and that requires further actions. that's mainly related to retirement programs to social security and even more important to medicare and healthcare cost trends. and so we've known about this for decades. there remains a need for action on this front. >> there does remain a need for action. and the long term budget outlook reports on some of the consequences of large and growing federal debt this comes again from the cbo's long term budget outlook. it cites like lower income pressure for larger tax increases or spending cuts. reduced ability to respond to domestic and international problems and greater chance of a fiscal crisis. are these things you consider with regard to monetary policy? >> i agree with the set of consequences that you just read to me. and ultimately, when we see those things being manifest, those consequences, so in the years ahead if deficits aren'

congress should expect, and this is embodied in the cbo projections, that as the economy recovers, short-term interest rates will rise. long-term interest rates already reflect that. , ifhe years go by short-term interest rates do indeed rise with a recovering economy, long rates will move up further. this will affect the interest burden of the debt and other things will add to deficit. that is clear. but it is also true that a strengthening economy needs stronger tax receipts. you and i seet: that as obvious. i see many of the discussions around here where we are looking at an environment where reports are telling us that just in a few years that interest will equal our entire defense budget. that section of the new normal interest rate models we are heading towards. my great fear is current monetary policy ultimately emboldens us to engage in bad fiscal policy. and we are going to pay a price for that. particularly if we keep seeing the revisions on her gdp growth, we may have to deal with this much sooner than later. you shouldn: well, be aware that interest rates are likely to arise and t

the interesting thing when we enacted that law, we talked to cbo about that specific provision. getting in the middle of these negotiations, the private sector negotiations to get the drug discounts, versus letting the folks who do this on a daily basis negotiate the discount in the private sector. they said if you had that provision in there, it probably would mess with the negotiations. but you definitely wouldn't save any money. and if you repealed that provision in the law today what cbo will tell you is, it will not save a single dime. the reason is, those ppms and those health plans are already negotiating the discounts. and they're already being passed on to consumers. that's why -- that's one of the reasons we did it. >> joel going back to the first part of that question. someone sent forward a question on a card, suggestion, actually after a long description of a situation to which it would apply, is it possible for providers to get access to health plan cost calculators? so that they are able to inform consumers about their expected out-of-pocket costs before the servi

obamacare, with cbo says is contracting employment by 2.5 million jobs. the 30 hour work week is forcing people to go part-time. 8,000 lost coal minors in my state. we're losing employment by the day. over the next ten years dodd frank will reduce by a trillion dollars regulations may be a factor in liquidity markets. the federal reserve has gone to extraordinary lengths to produce economic growth yet we see this lag and this slack as you say. shouldn't we start diagnosing the problem differently? this is a fiscal policy disaster? >> of course it's appropriate to look at why we've had such a slow recovery. it really has been pain stakingly slow getting the economy where it is now. remember we had a devastating financial crisis. it took a huge toll of households, left many of them struggling with debt, with massive losses in wealth underwater on their morgetages. they've been trying to get the debt under control. businesses have been cautious about investing -- >> i've got 15 seconds left. >> -- from that crisis -- >> one final point. low rates are not the

just three years later cbo ran their projections again and in 2018 u.s. debt as a percentage of gdp skyrocketed to 75.3%. one thing and one thing only happened between the projections of magnitude and that was the financial crash and the economic crisis it caused. >> and this is a chart that shows you real tax revenue is still lower and the second quarter of 2014 and 29 states since the recession. so not only did it go down in all 50 states and at the time of the recession and the time of the crash and the years afterward and continuing it to this year and real revenues are still down. >> it's interesting. the same thing happened in the private charitable sector and nobody talks about this. charitable contributions declined as the economic crisis continues and the charities were asked to provide more services with less support. the exact same problems that squeezed federal, state and local governments squeezed charitable sector too. charitable giving declined the worst worst in 50 years. no surprise this shock was the worst shock since the great crash of

deficit to the point where the next several years the debt to gdp ratio was stable, but over time the cbo projections as the population ages and especially if health care costs rise it has been historically typical in the country will face an unsustainable debt path in which the debt to gdp ratio rises and that requires further actions that is mainly related to retirement programs and social security and even more important, the medicare and health care costs trends. so we have known about this for decades and there remains a need for action on this front. >> there does remain a need and this includes reports on some of the consequences with growing federal debt is comes from the long-term budget out lead. things like lower income, pressure for larger tax increases or spending cuts, reduced ability to respond to domestic problems and a greater chance of a fiscal crisis. are the things that you all consider at the federal reserve with regard to monetary policy? >> i agree with the consequences that you just read to me. and ultimately when we see those things being manifested the consequenc

obamacare which cbo said is contracting employment by 2.5 million jobs. the 30-hour work week, which is forcing people to go part-time. the epa's rationing the energy. 8,000 lost coal miners in my state and losing employment by the day. dodd-frank, american action forum says over the next ten years dodd-frank will reduce gdp output by almost $1 trillion and last week. one of your colleagues on the federal reserve board acknowledged that regulations may be a factor in diminished fixed income in the liquidity markets. the federal reserve has gone to extraordinary lengths to produce robust economic growth and yet we see this lag. and this slack as you say. shouldn't we start diagnosing the problem differently? that this is a fiscal policy disaster. >> it's problem to look at why we've had such a slow recovery. it really has been painstakingly slow getting the economy to the point where unemployment is 5.3%. remember, we had a devastating financial crisis, it took a huge toll on households, left many of them struggling with debt. with massive losses in wealth

on obama care claims good for the economy the basics in 2014, cbo reports they expect obama care will result in a 2.5 million person job reduction and reduction by 2024 and 2.5 million people times 40 hours a week a100 million hours and for the year and you get 100 million times 50 weeks in a year and you're at 5 billion hours in labor productivity gone due to the single program and that is the response i get when you walk door-to-door, small business to small business from people on the street. is that we can't hire anybody, this is devastating us. and so i'll ask for your remarks on that. the economy is already struggling to keep up with a 2% rate, if that. and so the claim that the program is good for the economy i struggle with. and secondly i'll ask for your response at the micro level i have constituent who have approached me with concerns about the fda proposed rule to regulate premium cigars they don't have youth access issues sold at youth establishments and the goals of the tobacco goals were to prevent negative health effects from habitually oozed products neither of which

the cbo says that is running half a percentage growth for the next decade.roductivity. over the last four years, it has averaged half a percent growth so half percent growth in productivity, half a percent on the labor side, adds up to 1% real gdp growth, and that is a far cry from the 3% that everybody -- tom: lakshman achuthan is in the same camp as dean maki. pushing against this caution against labor force growth. state the opposite case from -- felix: labor costs are low, so when labor is cheap, you had labor. the natural flip will be as wages laois emerges, those sideline workers will reenter the labor force. carl: no -- lakshman: let's go to average hourly earnings. it is going up, close to a five-year high. as sherlock holmes put it, there is nothing more deceptive than an obvious fact. when you look at why is hourly average earnings growing, it is growing because the hours worked is falling faster than the decline. that makes hourly -- average hours worked -- this is why main street says wait a minute, there is a disconnect because they are earning