so we portray this, i think, or try to, to the prc, to china. and their response is generally, well, this is our sovereign territory and stay out of our business, which is for them to enforce their nondash line claim. so the implications are that if this activity continues at pace is that it would give them de facto control, i think, in peacetime of the -- much of the world's most important waterways, where much of the world's economic energy is created. it would -- if they desired, it would in the future give them an opportunity to have outposts to put long-range detective radars in there, a place to put more warships. they could put warplanes to force potential down the road air defense zones. those are the kind of scenarios we have to think about. and it essential complicates the security environment. so far, the asean nations who have tried to work with china on this to develop a code of conduct in my view has not produced very much at all. in fact, you know, the asean is an effective diplomatic organization, but it's not designed to handle

if the prc stays on the course that it's on now. we, my task is to support the taiwan relations act and to provide my advice to the, up to the osd and up to the president for him to decide what kind of things we provide. i know that they have requested our assistance in submarine programs, and we're contemplating that at this point in time but have not committed them one way or the other. they are particularly interested in us helping them in cybersecurity areas that allow them to pursue asymmetric capabilities that will improve their defense and improve their confidence that they can make decisions on their own and not be coerced. >> can thank you. >> colonel graham. >> thank you, captain. admiral, would you describe china's behavior toward their neighbors as provocative? >> i would call it aggressive and i guess provocative would be in the eyes of the beholder. but from my view it's aggressive. >> from the eyes of the japanese would you say it's provocative? >> i think they would say yes. >> okay. north korea general, would you sa

we have had some good work with the prc lately of building some confidence building measures that allow us to understand how to operate with each other in these constrained water ways so we don't have a bunch of lieutenants and captains and commanders of ships out there making, you know bad decisions that might escalate us to something we didn't -- that escalate us into a lucidities trap. we need to keep engaging them. we need to be forth right about how we feel about these things and what the u.s. position is on behavior when it doesn't match what our allies and our partners and our values systems support. >> clearly, in recent years the thrust of the chinese has been economic. but in even more recent years it has been military as you have testified today, tremendous growth and sub surface, everything else. what do you make of these actions, which can only be characterized as aggressive building islands off the shore and increased patrols in the south china sea. what do you read into that in terms of china's military or expansionist intentions? >> yes sir. i think the chinese communica

every time i say prc i think of china, i'm sorry.gress also directs the postal service to provide a special mailing rate for periodicals, restricts the ability to close inefficient post offices, they estimate that costs about $300 million a year. and all tolled, as robert suggested, prc estimates that legal and regulatory requirements cost the postal service around $4.5 billion a year. now this happens to correspond roughly to the postal service average reported deficit over the last decade, 5.5 this year but $4.2 billion average over the last decade. and to the commission's estimate of the total value of the postal service special privileges. including its monopoly on delivering letters, its exclusive access to residential and business mailboxes, and the exemption from a lot of state and local taxes and fees. so by this accounting the postal service is effectively self-sufficient financially. an economist approaches it differently and comes to a different accounting. which suggests that the subsidies are substantially greater. i est

if the prc stays on the corset is on now. my task is to support the taiwan relations act and to provide my advice up to the ost end up to the president for him to decide what kind of things we provide. i know they have requested our assistance in simmering programs. we are contemplating that at this point in time. but have not committed them one way or the other. they are particularly interested in us helping them in cyber security areas that allow them to pursue asymmetric capabilities that will improve their defense and improve their competence that they can make decisions on their own and not become worst. sen. ayotte: thank you. senator graham: would you describe china's behavior towards is -- towards its neighbors as provocative? adm. locklear: let's call it aggressive. i guess provocative would be in the eyes of the beholder. senator graham: from the as of the japanese, would you say it is provocative? adm. locklear: they would say yes. senator graham: would you say the regime on a goodie is unstable? gen. scaparrotti:

with the help of alrp and prc, i was one of the few lucky ones and able to return to work and supplement my social security so i am able to survive, but i just want to thank supervisor wiener and this committee for addressing this important issue and increasing funding so that people do not face homelessness and that other support services are included in this proposal as well. thank you. >> thank you very much. next speaker. >> good morning, my name is newton butler, thank you for making time to hear about this important issue and for those who spoke before for their excellent presentations. i have been positive with hiv for about 34 years, been on disability for 13. 85 percent of my income, which is made up of ssdi and also long-term disability, is paid to rent here in san francisco and for the balance i am gradually plowing through what i had amassed as savings. in three and a half years, i am 61, i will turn 65, my long-term disability will turn out and i will accelerate through the process of exhausting my supply of funds. i am very helpful for project open hand and for the food ban

we've had some good work with the prc lately of building some confidence building measures that allow us to understand how to operate with each other in these constrained waterways so we don't have a bunch of lieutenants and captains and commanders of ships out there making bad decisions that might escalate us to something we didn't -- escalate us into the trap. so we need to i think continue engaging them. we need to be forthright about how we feel about these things and what the u.s. position is on behavior when it doesn't match what our allies and our partners and our value systems support. >> clearly, in recent years the thrust of the chinese has been economic, but in even more recent years it's been military, as you have testified today. a tremendous growth and subsurface, everything else. what do you make of these actions which can only be characterized as aggressive building islands off the shore and increased patrols in the south china sea? what do you read into that in terms of china's military or expansionist intentions? >> yes, sir, i think the chinese communicate to us pre

last month announced along with bearington capital it taken a two% stake in prc.nd it's urging the company to make a bunch of changes to create value. the news caused the stock children's place, not just the attire but the actual stock to joint 8.6% in a single session. so first of all, we need to ask, why are these guys targeting children's place? this is a perfect example of how the actives are choosing their targets. basically someone is targeting children's place because the company has a long history of underperformance. ever since the ceo took over. the stock has lagged the broader market. he points out that under the tenure the company has posted negative to low single digit sales. disappointing, again, disappointing. subparresults aren't the only they thaz look for. in order for these guys to say that high level changes need to happy. current managers have to prove that they can point to past mistakes to illustrate out the executives in question have failed to meet goals. what they did was out of the activist's play book. she talked about optimizing invent

after themselves or let another state-owned bondholder go after them, so it remains to be seen, but the prcthat it approves, they don't want to see default, so it is not going to occur, so i think at the end of the day, these bondholders may be made whole, maybe not now, but eventually but overall, the consensus is pretty clear that the overall body issues taking place, they don't want to make the alix: markets to generate. alix:-- the markets too g jittery. alix: what is left in the toolbox beside that and the overall rate cut? will: we are looking at something that may seem like the european credit facility and that is either buying a bond or having a continuation of bonds for them to try and soak up the additional situation that is going to take place, so it is going to add systemic leverage, it is already pretty high, so by the end of 2015, there is going to be the percentage but that will make the gdp higher for systemic leverage, so that is really the function of the transition taking place and one that is managed quite actively so i don't think that they are excited about it, but i t

in the last 10 months it went from admiral locklear: we portray this -- the prc, the response is generally that this is our sovereign territory, stay out of our business. the implications are if this can activity continues, it would give them de facto control in peacetime of much of the worlds most important waterways, where much of the world's economic energy is created. if they desire, it would give them the opportunity to put long-range detection radars in their, more warships air defense zones. those of the scenarios we have to think about. it complicates a security environment. so far, the nations who have tried to work with china have not produced very much at all. in fact, it is an effective diplomatic organization, but it is not designed to handle security shoes that pop up. we have to watch the situation carefully. senator reed: thank you. general scaparrotti, we have a complicated relationship with the chinese. to what degree do you have a contingency plan to communicate with them if there is a serious provocation by the north koreans that would introduce the idea of using force?