. >> corporate funding is also provided by prudential financial. additional funding is also provided i the annenberg the corporation for public broadcasting and by contributions to your pbs station from viewers like you. thank you. once again, live from washington, moderator gwen ifill. gwen: good evening. take your pick of adjectives -- the debt ceiling deadline is looming, or threatening, or imminent. or verbs -- collegiality has collapsed, patience with washington has plummeted. or merely descriptive -- republicans are stubborn, the democrats are job killers. none of this point and counterpoint allows us to escape a troubling truth. unless someone somewhere comes up with a solution that can win votes from democrats and republicans in the house and the senate, the nation will default on its obligations beginning next week. after spurning speaker john boehner's plan yesterday, the house today came up with another approach. which finally passed, but is certain to die in the senate. >> i stuck my neck out a mile to -- i put revenues on the table in

. >> corporate funding is also provided by prudential financial. at&t, rethinking -- possible. additional funding is provided by the annenberg foundation, the corporation for public broadcasting and by contributions to your pbs station from viewers like you. thank you. once again, live from washington, moderator gwen ifill. gwen: good evening. when the president of the united states starts using words like "armageddon," you can be forgiven for wondering how we got to this point. short version? leaders in both parties agree that borrowing limits should be raisedand that the deficit should be cut yet they seem no closer tonight to figuring out how to do it than they were this time last week. the basic options on the table, the big deal, about $4 trillion in budget cuts. the medium deal, about 2:5 trillion in cuts with no revenue increases or tax price. and the deficit ceiling deal. at a white house news conference today the president resorted to bakery metaphors. >> i think about this like layer cake. you know, you can do the bare minimum and then you can make some progressively

that's why we're here. >> corporate funding something also provided by prudential financial. at&t, rethink possible. additional funding for washington week is provided by the annenberg foundation, the corporation for public broadcasting and by contributions to your pbs station from viewers like you. thank you.

. >> corporate funding is also provided by prudential financial, additional funding for "washington week" is provided by the annenberg foundation. the corporation for public broadcasting. and by contributions to your pbs station from viewers like you. thank you. here again from washington, substituting for gwen ifill, pete williams of nbc news. >> good evening. you know it's serious when congress foregoes one of its most cherished traditions, leaving town around the holiday. senate majority leader harry reid delivered the solemn news to his colleagues that they'll have to cancel their post fourth of july plans and come back to washington next week, to work on trying to find some way to raise the amount of the federal debt. that decision came after the president scolded congress for putting off the tough decision. >> malia and shasha -- sasha generally finish their homework a day ahead of time. malia's 13, sasha's 10. it is impressive. they don't wait until the night before, they're not pulling all-nighters. [laughter] they're 13 and 10. you know, congress can do the same thing. if you kn

financial challenges ahead. this rock has never stood still. and that's one thing that will never change. prudential. >> this is the network. a living, breathing intelligence that's helping to drive the future of business. in here, inventory can be taught to learn. machines have a voice. medical history follows you. it's the at&t network. a network of possibilities. committed to delivering the most advanced mobile broadband experience to help move business forward. >> corporate funding is also provided by boeing. additional funding is provided by the annenberg foundation, the corporation for public broadcasting, and by contributions to pbs stations from viewers like you. thank you. once again, live from washington, moderator gwen ifill. gwen: good evening. just when economists were beginning to predict light at the end of the tunnel, the monthly job numbers said no, not yet. and just like that, the white house was on the defensive again. >> we've added more than two million new private sector jobs over the past 16 months. but the recession cost us more than eight million. and that means that we stil

. >> corporate funding is also provided by prudential financial, additional funding for "washington week" is provided by the annenberg foundation. the corporation for public broadcasting. and by contributions to your pbs station from viewers like you. thank you. here again from washington, substituting for gwen ifill, pete williams of nbc news. >> good evening. you know it's serious when congress foregoes one of its most cherished traditions, leaving town around the holiday. senate majority leader harry reid delivered the solemn news to his colleagues that they'll have to cancel their post fourth of july plans and come back to washington next week, to work on trying to find some way to raise the amount of the federal debt. that decision came after the president scolded congress for putting off the tough decision. >> malia and shasha -- sasha generally finish their homework a day ahead of time. malia's 13, sasha's 10. it is impressive. they don't wait until the night before, they're not pulling all-nighters. [laughter] they're 13 and 10. you know, congress can do the same thing. if you kn

first time in which consumer protection and safety and soundness will not be handled by the prudential financial regulators for institutions over $10 billion in assets. while we do not agree that many of the prudential regulators -- while we do not disagree that many of the prudential regulators failed to uphold their responsibilities in the years leading up to the financial crisis, there is a legitimate concern in separating consumer protection from safety and soundness. this is why h.r. 1315 is a much-needed improvement to the dodd-frank act. the act gives the financial stability oversight council, known as fsoc, the ability to override a cfpb rule or regulation. however, the flesh hold is set so high -- threshold is set so high, the threshold is so high for the fsoc to consider the overturning of the cfpb rule or regulation that in reality it will never happen. furthermore, a 2/3 majority of the fsoc is needed to overturn the rule once a petition is filed. this simply sets the bar too high and further exacerbates the problem. this is mr. duffy's bill and it will lower the threshold for petiti

financial regulators including the fed. for example, the fsoc has authority to make nonbinding recommendations to the board on enhanced prudential standards or sifis which dodd-frank requires and all regulator to promote financial stability goals. the last area i want to discuss is crisis management. dodd-frank removed a number of tools used by the government to manage the recent financial crisis. in particular, dodd-frank placed restrictions on the fed's lending authority in sexes 13.3, and not only has @ authority been restricted to broad-based facilities, but the secretary of the treasury can veto the establishment of the filths. while dodd-frank reigned in the tools, these constraints on the fed's authority in the context of other reforms is a positive step towards eliminating too big to fail. the narrow lending facilities at the fed employed during the crisis like bear stearns were created because there was no other authority at the time used to protect the financial system for the disorderly failure for large interconnected financial institutions. in title ii, there's a set of tools to manage the resolution of a failing fi

prudential. bring your challenges. >>> for millions of americans, this week's fourth of july will be bittersweet. the financialvency,, slipping further and further out of reach and cities like pontiac, michigan are seeing erosion of the middle class. now pontiac is trying to fight back. here's abc's jim sciutto. >> reporter: at the "gma" plants, padlock, belongings left behind but t people. a city full of empty monuments to its heyday. a truck plant dark,early 5,000 homes, shops and businesses. today unemployment stands at 25% and the middle class is fearing going the way of the snake sake car. sam carter bought his house when he had a steady income and steady job. >> i got ten year on the company and think i'm going be there a while. >> in 2004 he lost his job and had to spend his entire 401(k) to keep his house. when he did find work his wages dropped from $11 to $16 an hour. >> i'm starting over again. >> at 50. >> what was a vibrant city, the tal grass in the front yards is a tell tale sign. many residents don't believe the jobs or neighbors ever coming back. >> francis davis taught at a nearby charter sch

prudential. bring your challenges. >>> for millions of americans, this year's fourth of july will be bittersweet. in a gloomy economy the great dreams of home ownership and financialolvency, slipping further and further out of reach and cities like pontiac, michigan are seeing erosion of the middle class. now pontiac is trying to fight back. against increasingly difficult odds. here's abc's jim sciutto. >> reporter:ality the shouldered gm site in pontiac, mark began, dead plants in the lobby, belongings left behind, everything but the people. a city full ofofmpty monuments to its heyday. a truck plant dark, nearly 5,000 vacant homes, shops and businesses. today unemploymentnttands at 25% and pontiac's once burgeoning middle class is going the way of the namesake car. sam carter bought his house when he had a steady income and steady job. >> i got ten year on the company so i'm thinking i'm going to be there a while. >> but in 2009, he lost his job and had to spend his entire 401(k) just to keep his house. when he did find a job, his wages dropped to $11 an hour from $16 an hour. >> i'm starting over again. >> at the age of? >> 50. >> what was a vibrant city, the t

prudential regulation. but the second narrative suggests that weaknesses in the financial sector during 2007-2008 period contribute to a uncertainty about the billy of issues in the short-term market to make good on the obligation. investors in money market funds particularly in a growing number of institutional investors a money market fund simply look to the portfolios to the issues that were issuing paper and lost complete confidence. beginning of course with lehman brothers when it collapsed but thereafter aig and a number of other major players, commercial paper issuers, who appeared to be employed at the time. and lost confidence of the short term market. this narrative suggests that if there were not money market funds, if folks have been holding the commercial paper or the obligation of the underlying issuers a would've ceased rolling it over and you would've had the same crisis. the first narrative, best articulate i think by paul volcker in the broadest form whole to money market funds as the culprit, part of the shadow banking system. that's where that term is used. the other narrative, i think articula

financial supervision by the federal reserve and other kinds of requirements. supervision is an alien concept in the world. while professor bullard is talking about the sec becoming a bit more prudential, the fact of the matter is the regulatory model has never been of the nature that is omnipresent in our businesses are telling us how to operate in the way the federal reserve and other bank regulators do with respect to depository institutions. the implications of that are unknown, perhaps unknowable and i've heard federal reserve officials say they are puzzled by it, too if they had to move in that direction. the capital issue is even more murky because to a very large degree, advisers to know what they need capital to assure they have sufficient robustness for ongoing operations, thomas capital requirement of the sort that banking institutions to an mutual funds come you can either look at having zero capital were 100% capital. so it is a question i think that i'm not exactly sure but the answer answers to. i would tell you, congresswoman, i hope we don't have to find out. >> i can answer that. >> interestingly enough, the reason why there was substantial institutions are the typos

financial institutions, in a situation where investors face a true risk of loss. i also think the work being, council staff is doing and the work in areas of heightened prudential supervision, i know it's not yet finalized but think very positive progress there, and i think we should all feel good about the progress that we made in this first year. >> thank you. john is the director of the missouri department of insurance, financial institutions and professional registration. john. >> thank you, mr. secretary, the much. it's been approach for me to serve on this council with my fellow financial regulars. this council is certainly engaging in difficult but important work that will undoubtedly improve u.s. financial stability but will also have an impact on financial institutions and the regulation. given the gravity of these deliberations and decisions being made by this council it is critical that all sectors of the financial system be well represented. for much of this inaugural year of the council i was the only insurance sector representative, and i remain the only insurance regulator. i continue to believe this council would benefit from greater input and expertise of