tv Social Security CSPAN November 25, 2014 2:49pm-4:47pm EST
overall package, which impact on the financing gap people preferred. this wasn't a wish list. this was what americans -- how americans prefer to solve the problem. and one thing we saw, if i can just get one -- is they do want to close the financing gap. and this was evident in the responses. that was evident in the package they preferred the most. so this is the methodology used very often in the private sector. we've used it tons of times. don't think it's been applied in the public policy, or i'm not aware at all, but i think it really gave us new and important insights. with that i turn over the clicker. [ applause ] >> we are hoping jason furman will join us. is jason here yet? on his way, okay. i guess we can have questions until jason arrives. over there. just state your name because c-span is -- there is. the question is, where is it? who has the mic?
we can't hear you. here it comes. >> yeah, for each question identify the organization. >> hello. identify yourself and your position. >> i'm a humble tax reporter and analyst. there three of us. i'm not an expert about social security, but my understanding is that surpluses of the program for a given year invest in a trust fund and treasury bonds. they have a low yield. there was a plan to privatize social security. it would seem to me that having a slightly more normal it's
endless. for example, raisings and eliminating the tax cap. we had to pick and choose which to include. especially in the trade off, we collected only 12 of what is commonly proposed for social security. so we did not test the options that would invest the money differently. that would be a great question to ask. >> yes? >> a microphone over here.
>> i'm hannah weinberger. i have a methodology question. how did you get people to pay attention to these detailed survey questions that i was looking in the report and it looks like it took them about 20 or 30 minutes to complete. it looks like people did, but i'm curious how you got them to do that. how did you find the people who were willing to get through? >> this is great -- [ no audio ] >> okay. thank you. this was an online survey. people were part of the a panel of research now, about two million people. they have a slight incentive to participate. about 20 minutes. we do a lot of surveys and you can get people's attention in 20 minutes. the good thing about an online
panel is people can read the choices and understand it. we find that useful. at any rate there is a great deal of survey research being done and accurate in predicting elections. we will see what happens this time. we got cooperation that was needed. we can understand how long they did it and if it's quickly, it's through the maps. for example, if they just answered everything the same, they have straight liners. they have life surveys being done. >> was there overlap between this year's group of respondents and the last? >> each was a representative sample of the population. we didn't go back to the people we surveyed before. that is in some ways by design. sometimes people learn and they
are screw and prejudiced in that way. new simple. >> when people find the surveys, they can't believe they would raise their own taxes and you found them two years ago and went back this time. those are not near the representative sample. thank you very much. as i mentioned earlier, the council and economic advisers. probably his one of the toughest jobs. remember earlier i said few issues on whether there was bipartisan agreement. it's fair to say whether you are a republican or democrat or
independent, the reputation for objectivity, quality and we can talk about the perspective on this issue. >> social security plays a critical role in the retirement system, providing the basic foundation on which security is built. it provides the survivor's insurance and protects all of us against the possibility that early death will leave our family with reduced means of support. that's why i'm grateful for the continued work on all of the aspects of social insurance and how all of them fit together.
they have the public understanding of this critical program and ensure all americans protect against wildlife. social security will convey direct benefits of $863 billion. to 58 million americans in 2014. almost 90 million are 65% or older. those payments make up an average of 38% of income for people over 65. social security provides greater benefits to the most vulnerable workers. it replaces a larger share at lower earnings levels. equals 14 million retirees would fall into poverty without social security. without social security and age 65 would increase from less than
10% from over 40%. as they brought down the savings at older ages, it becomes more important as a source of income. for the most elderly, it is the primary source of income for over half of married and 3/4 of unmarried beneficiaries. social security benefits are particularly important to women. in 2010 more than half of women over 65 had no retirement savings and 401(k) counts. women's lower retirement savings and longer life expectancies can translate into greater hardship in old age. that is why features of social security including spousal and survivor's benefits and the progressive formula and the guaranteed long benefit indexed to the cost of living are all so important for women.
many particularly important for african-american & white households with the retirement savings. it stems from unequal access to work based retirement. they participated employment based retirement plans compared to about half of whites. as such, they have different groups. for elderly beneficiaries, they could for 90% and 35% of whites and 55%.
as you know, social security is more than just a retirement program. it is an experience program that covers the vast majority of american workers. almost all workers of pate employment are covered and retearees make up 70%. disabled workers and survivors of deceased workers make up the other 30%. roughly 95% age 202049. they have a disability protection. these protections are provided at a relatively low administrative cost and without the adverse premium you might otherwise have to pay. social security will continue to grow and workers bear more risk to the retirement benefits.
active participants were in defined benefit plans. by 2011, this number had fallen to 18%. they define contribution plans that provide what workers have saved plus whatever the gains have accrued. the plans provide an important opportunity for americans to accumulate wealth in an important part of a retirement system. not all americans have access to contribution plans. over half of the workforce has no private pension plan at all. for those that do have savings, few people roll over their savings and especially with the type of built in cost of living adjustments provided by social security. part of the answer to these
challenges is to strengthen the ability it of americans to save for their retirement and a you initize the savings. in 2009, the treasury expanded the ability to establish opt out systems for retirement savings that are a proven way to increase for 401(k) plans. earlier this year, the president directed treasure tow establish my ra accounts that would provide an easy and safeway to introduce more americans to retirement savings and pushing for legislation to make savings plans available to all workers who do not have them today. mottles on an idea developed by the heritage foundation and the brookings institute. there is no substitute for social security's guaranteed benefit. that's why it's important to work to protect and strengthen social security.
addressing the challenge it faces as well as protecting the beneficiaries that rely on it. as the president said in his state of the union address, you should find a bipartisan solution to strengthen social security for future generations. you should not put at risk the most vulnerable and people with disabilities without slashing benefits for future generations and subjecting americans guaranteed income to the whims of the stock market. thank you. jason is kind enough to stay for a couple of questions. the survey finds across the board support for the benefit for expanding social security so
it prois more generous benefit for the lowest income. there a handful of bills that have been and what are the prospects that the president might get behind that? >> as i said and as the president made clear, this is something you need to deal with on a bipartisan basis and the solvency of social security. in the process of doing that, you want to look at key areas of elderly women living alone have high poverty rates. that's something that someone could address in social security reform. the minimum benefit have become outdated. that's another thing you could look at in the context of social security reform. as he said many times, that should be a conversation and that conversation should recognize all of the important things about social security that i described.
they should try to strengthen and improve on the system. >> questions? there was one. >> hi. nice seeing you, jason. so the other broad area of agreement in the survey was increasing fic attaca taxes. i guess you don't want to announce that today, if you do, feel free. do you think there is bipartisan appetite for that? >> i don't want to speculate about what this appetite is for. what is important is this program has a bipartisan history that is important across the spectrum and that we work together to strengthen that.
>> any other questions for jason? >> nothing? >> he's a fine guy. agai again. >> the committee for responsible federal budget. it made me think about that. we found the results were bipartisan, there is bipartisan support for lifting the payroll tax rate. is that something that the president would be willing to do even though it would come in conflict with the pledge not to raise taxes under $250,000 a year. if there were bipartisan support. >> this is something he would want to work on a bipartisan manner to do. he said in the past when you are dealing with social security, on a number of occasions that bring an additional revenue from high income households, something he thinks has a lot of support and would be consistent with
strengthening the program. >> one more. >> jason, a slightly different question which is not so much what would the president do or what policy makers are going to do, but what we found in the survey. quite widespread and raising taxes if that's what it took. do they have any personal speculation on how that would -- the disconnect. from the general public and the conversation of washington. >> i don't -- i'm not an expert in public opinion, but i can tell you that social security is just a very important program. there ways that strengthen it.
>> to moderate this panel discussion about the study of findings. we have mark who has been very involved in writing about it. mark miller. he covers the issue of roadwayers. he has been looking at the issue as much as anyone else in the past few years. his bioin your color. when you look at the writings, they are strag matic. everybody has to take a role in planning for their own resources
appropriately. mark will moderate this and i will turn it over to you. >> a special welcome. interesting and provocative panel for the discussion. we have about an hour and that will give us time at the end. before we get started at the academy, we are asked to remind you. we hope that you will take a minute to fill those out as it helps us with planning the future events. as a journalist, i devote a lot of coverage to social security. along with coverage of health care for average americans.
release the latest numbers. it indicated and americans would be living below the poverty line? that's a fairly dramatic figure i think. the benefits that are provided, the benefit will be a few thousand over the poverty line. when it comes to the future, the survey of what it does shows a clear public cons consensus. income groups and people do want social security to do more and not less. they seem to be willing to pay for it. it's remarkable in light of the general distress of government we see today and lack of agreement about anything else.
at the same time we see the future of the program. let's get to the thoughts. they are going to introduce them to you and we will find detailed biographies of the packet. andrea campbell teaches political science. an expert on social insurance and taxes and public opinion about them both in the u.s. and abroad. she is author of a new book and family's struggle. to explore how means tested programs actually work on the ground. an expert and tax and economic policy. once dubbed an regularly
testifies before media outlets. the vice president for income security policy at the academy and directs the academy's work on social security, disability shrs, worker's compensation and unemployment and related issues. she authored many of the brief and reports and directed the landmark studies on proposals to partially privatize social security and on promoting rehabilitation and employment on persons with disabilities. the president and ceo of global policy solutions. she also cochaired the commission to modernize social security that developed a reform plan to make social security fully solvent for more than 75 years. she held the black caucus foundation. the office of charles rangle and
the staff ways and means committee. our procedure and format is fairly straight forward. the study for a few minutes. they have a moderated conversation before campbell. >> thank you very much for inviting me to be here. i want to make two pointings. is to talk about social security in a context of other programs we have in the u.s. then talk about what the public likes a& a lot of commentary tht reached a fever pitch in the great recession about the cost
of the major entitlement programs. the implications from the future and the need to trim them back with predominant theme of the conversation. the question of medicare for a moment, social security is in pretty good shape, not that you would necessarily know that from the national conversation, but the long-term gap is solvable in a number of ways. i would argue that not only are there strong arguments for preserving the program as it exists today, but strong arguments for enhancing benefits especially at the low end of the income spectrum and particularly when we look at what social security does and citizens compared to what happens in other countries. >> it is our most effective anti-poverty program.
aids far more effective program than social assistance or means tested programs which are variously weight listed such as housing assistance or child care assistance or which don't reach as many as they could. take food stamps. only 2/3 of eligible people el rolled compared to everyone eligible for social security being enrolled. they have difficulty accessing doctors and ssi supplemental security income to the poor elderly, blind and disabled citizens provide payments that are below the poverty level. i detail the shortcomings and the social security as a social insurance program rather than social assistance does a better job than all of these programs
in terms of alleviating poverty. there a number of reasons for concern around social security. despite the fact that it's the most expansive social policy we have, it has significant sort comings. >> the replacement rate for people's working age incomes that social security replaces is lower. par the minimum benefit is inadequate overtime. older minorities in the old, old whose other sources of income have been exhausted. the other thing worth noting is
benefits are falling in the sense that medicare cost sharing is going up. if you look at the premiums and deductibles and coinsurance that they pay for doctor's visits and prescription drugs that, consumes a growing share of the average social security check. now it's about 29% and projected to grow to almost half in 2040 unless you make changes. it's an effective program, but there arguments in a number of ways. the question is, is the public support there? we can take a look at the survey. we know that large majorities do not provide incomes for seniors and we should raise retirement benefits and preserve social security. if you look at other polls that compare support to other government programs, social security usual lly comes out as
number one. is there a willingness to pay overtime? they have asked about isolation and do you want funding to be increased or kept the same? there is high support. we asked questions such as should social security funding be increased versus reducing taxes or addressed to the budget deficit. social security wins out. there can be questions that ask how would we want to go about social security funding. i am referring to many overtime. the most popular consider is increase taxes on the affluent. we might wonder maybe ordinary people are unwilling to fund social security themselves.
what is interesting is that it includes not just contributions from high earners, but increasing the payroll tax for all earners. it makes us more certain that people can put their money where their mouth is. the percentage of people with the top earners versus increase on all americans, that gap is only 6%. that's very, very small. huh large majorities of all groups agreeing with this. there is a lot of consensus here. the other interesting thing is the preferred package in the trade off analysis pairs these enhancements with benefits that are progressive in nature. raising the minimum above the poverty line. it's clear that the people want these progressive reforms and
robust funding. i will end by saying what about age and income and party identification which we see in other areas? there was scientists and sociologists that talked about generational conflict. i have never seen any evidence over the looming conflict in these data either. there 12 points that separate from older americans. i think the point is even when there is a gap there, it's large majorities with our support of the program. 80% say they are more important than ever. 77% say they don't mind paying oeshl security taxes.
you have strong majorities even in the most skeptical group. we might language a rift between lower and higher earners. especially higher earner who is pay more in and get a lower replacement rate and less depentent on the program for income. are they less supportive zult in not so much. we have large majorities of higher earners supporting social security in general. finally, party id. we have such a polarized era. democrats and republicans are wide apart. take the aca and the democrats and republicans is 50 points. that is a lot smaller than when we turn to social security.
there differences with favorability towards social security in theture have a. the more skeptical group on the side of the 50% ledger. they are favorable to where social security is. there is a 15% gap between democrats and republicans in the percent saying that they don't mind paying social security taxes. it's a republican super majority. 72% saying they don't mind paying the taxes and a 15-point difference to where they should consider raising the benefits. they are at 65% in terms of support. in closing, it's a crucial support. it's that could provide more comprehensive protections. the support is there. we might worry on surveys that people engage in cheab talk and that support would evaporate, but the trade off analysis can
make us more certain that it is real and we need lawmakers who put them on the table. as you know, the sooner we make changes, the less severe they have to be. parrot inner generational conflict, i watch with the amusement and we get them up. there is no evidence in the data to suggest it exists. we don't live in the silos. parents and grandparents understand the meaning of that. i marvel that we keep writing the stories and try to make it out as though it exists. there is no basis for it. why don't you go next? >> thank you very much. thanks so much for hosting this event today. it's a really, really interesting and important study.
i will start with how important social security is to the economy and budget. it does so much to lift millions out of poverty. it is more than a retirement program in that it helps with the disability and plays a critical role. one of the most important things is that it's in annuity form. it protects people against out living the benefits. we don't have that in other areas. really, really important. it's also the federal budget's largest program. while it is separate from the rest and has a unique status, it has a big effect on the rest of the budget. the survey, i think it's going to end up being a -- singing the praises of the trade off analysis. it is really important. one, it focuses on the right questions and how we would fix social security giving you lots of choices and the trade offs is what budgeting and fixing the
programs is all about. i think about the political season when social security is the issue that people run the most negative on and try to scare monger the most. you have one candidate saying i would fix social security by lifting the cap and getting a plan that would be fixed. that's the person that gets the points. if you don't have trade off and people saying just fix it. setting it up the way it did here is really important. in terms of the specific things we learn from the survey, interesting stuff here. one of the things i think is most important is it gets to full solvency. a plan that people are willing to support. there is support for enough changes to fix the program.
that's enhancing the minimum benefit. a lot of things make this program outdated. people are not living above the poverty line. along with fixes to ensure the solvency of the program, we can focus on strengthening the program. there was another area, but the highest level is for senior women over 85. the old, old. the things that bump up benefits for the very old that would strengthen the program. the other thing i was just very impressed with, the american people, but they were talking about being willing to lift the tax rate. so often what we hear about and specifically again with the polarized environment. would you tax somebody else. would you cut somebody else's benefits? people are saying we are so committed, we will put more
money into it. this is what i think about the results and the plan i would or would not like. the piece i am east comfortable with, it increases the benefits for the well off by an awful lot. the increase would be for low income people. medium perm people it's about $14,000. for the well off it would be about 1 preponderance $5 million. somebody making a million dollars a year while they are working and contributing to the plan. in my mind, having the well off making that much is not the best use of resources.
the amount of rev news it would take to fix the system, if you did it while expanding benefits. this would be about an addition of $12 trillion. you could get get rid of the sequester. you could fund the program. you could have another war in iraq which is not what i suggest we should do, but have for resources for something else. you could double the funding for low income education and social services and the eitc job
training. this is a question that coming up a lot in budgeting. what is the best use of new resources? the question clearly here that we have seen is that social security is popular. again, people put their own money into it. we should take the trade off and expand it. i don't think we should fix social security, but neats for budgeting. we have a huge gap. we stro make social security solvent. this is the next project. to all of these parts would be interesting to see.
the issue of saving and retirement. they are not preparing well enough for retirement. this is clearly an objective because we are not headed in a good direction. thinking about the big picture is important because budgeting is about trade offs. this is an open discussion. thirdly as i talk about in terms of what this particular plan would do to increasing benefitses for the well off. i think targeting of limiting resources is critical. we have to fix social security. the longer we delay, the worse
the choices become. how we have get to the business of fixes the system. thank you. >> thanks, maya. virginia? virginia will go next. how do i get to the number one? thank you, maya. i want to comment on the comment on the survey findings and the questions and comments that maya raised. if you take this view of the program, they expect something
in return. i think the public mind that pays for the future benefits that are closely connected both are specified in detail in the law. this is something that has to be addressed by lawmakers if the system is out. what kind of questions should lawmakers consider? i would pose very basic ones. they are the same questions that we ask the american people. are the benefits and the law adequate? are paxes needed affordable and what do they neat to do to do the job? the people will benefit at another point in time.
on the question of affordability, many entitlements are are raging out of control. if we look at the benefits scheduled in the current law, though they are not fully financed, they are close to a flat line. it's about 6% of gpw, 5% rising to 6% and flattening out at 6.1 or 6.2 for the next 75 years. there is the affordability issue for those still in the law. that issage r american league
beingmented pabd understand are are a issue. current benefits are scaled back by more than many of us realize or are talking about. back in 1983, the last major social security reform, several important changes were put in place, but put in place to lower benefits and do it very, very gradually overtime. the first was to raise the retirement age from 65 to 67. that's happening now, but very slowly. i think most people realize, that's equivalent to a benefit cut to retirees. about 6.6% for each year that the age goes up. 16.5% roughly by raising the age for two years. by 2050, retirees younger than 90 will have been affected by the retirement age. that keeps costs under the system much lower than they
would have been. the second change that began in 1973 has benefits to income taxes done with the revenues back to the social security trust fund. it's a reduction in net take home beneficiaries. congress subjected a bit more and allocated that to the hospital insurance program. that is about 8% or 9% of social security outlays that are coming back to social security and medicare. the last long-term change is small, but it's part of the package that lowers outgo and
that is delaying the cost of living adjustment by a half year. that's about a 1% or 2% out go because the cost of living adjustment is 2% to 4%. these are the lasting impacts of the amendments that we haven't seen the full effect of yet. what did lawmakers do? when the greenspan commission met, they were running out of money months after the legislation was finally signed. it did not come up with a recommendation long-term. it did come up with two options.
one was to raise the retirement age and the second was to schedule a tax increase when they needed to keep the system in balance. both were to address the challenge of the 21st century. when it got to the congress, they had to act and they chose only retirement age increase. one of the lawmakers recorded as having said there was a reason for this. we have to give workers ample notice. we don't need to give long notice to raise the tax. we can do that when we need to. this survey seems to suggest that they are suggesting maybe now is the time.
americans are willing to pay and this sounds like it might be the time to do it. i want to sment on lifting the tap. it was designed not to pay benefits to millionaires. it was designed not to do that. i will stop there, but look forward to the discussion. >> thanks, virginia. and last we will hear from maya. i would like them for producing a very important report. americans have made a hard choice on social security and that is to say with a resounding
yes, we support social security. it's one of america's pillars of progress. we created it because there was market failure. there were no options for people who worked all of their lives and repyred or had no ability to continue to receive support in retirement. many ended up in poor houses and destitute poverty. we decided we can do better than that. we are better than that. when we work together, we achieve tremendous benefits. that was a pillar that we come
together. medicare was a market failure. seniors who worked all of their hardworking lives more than 50% of health insurance prior tote creation of medicare. we decided we were going to form another pillar of progress and that was medicare. here we are despite all of the arguments we have prd over the past decades and it intensified over the last decade. we can't afford social security. we can't afford the programs. we can't afford entitlements. these programs are certainly -- just the ultimate in disrespect to the american people is to suggest these are unearned
benefits. people know they pay for it and people know they are deserving of it. to label the programs as entitlements as if it's a welfare program is a slap to the hard work ethic of the american people and it's certainly a slap to the history of making sure that we actually invest in our social instruments programs. with that, virginia mentioned the demographic challenge in the reforms of 1983. at that time they were framing that demographic challenge as one of the retirement of the baby boom generation. we were going to cut benefits and they did by increasing the retirement age. they allowed the trust funds to grow to prepare in advance the shifts in regards to the expected retirement of the baby
boom generation. kay came to do the right thing and prefund the program so that we could make sure we were taking care of the future demographics. i'm here to suggest we need to do the same, but for another challenge of the 21st century. many are focused on the graying of america, but not the browning of america. the increase of the population of the us of america is important for this conversation. today of all babies born in the united states, by the year 2019, of children under the age of 18, a majority will be children of color. then the bureau presents by the year 2043, a majority of our population will be of color.
why is this important to social security? when you look at the status of these populations, you can understand why social insurance opinions to be a very important pillar of progress that we need to strengthen for the future. there is a ashl income gap and the earnings of quits you see a stark difference between earning significantly less in terms of the wealth gap in terms of not just become, but assets owned by the populations for every pealth and health and the typical family owns 6 cents in the typical latino family owns seven
sends. they are expected to grow in the future are the ones who remain at the margins and at the very bottom of theus economy and economic ladder. social security will be as important if not more so for the risi rising demographic. you need to strengthen social security from a different perspective and not from we need to -- we have been hearing over years or so that we need to cut benefits. that takes the rug out from under the people who will need it in the future. we have been hearing that one of
the most important is raising the retirement age. guess what. people make arguments like we need to raise the age because we are all living longer. that's a fabrication. the upper half of the description is living longer, but they stagnated and in some groups it's reversed. for white women who without a high school degree in poverty, the life expectancy has declined by five years. this is in the wealthiest nation in the world. so we have been talking broadly about inequality in america. social security is an important part.
how we write the ship and bring equity for all americans with regards to that with african-americans and latinos and other people of color, they shared the statistics. because they were lower income, they have a heavier reliance and they rely on the program, not just the retirement benefits. many don't know that 38% of all social security benefits go to disability and survival. but when you look at for example the african-american population, almost half rely on social security for disability or dependent care. excuse me.
the survivor benefit program. you need to keep that in mind when you look at solvency for the program. i like to end by saying that we are in a representative democracy. i'm a political scientist. this is a republic, but we are supposed to be representative and the officials are supposed to be representative of the people. so what the national academy of social insurance has been able to do as a part of this important study, americans making the hard choices on social security has been able to shine a spotlight on what americans want and what they are willing to pay for it. guess what. they are affirmingly and resoundingly saying we want social security. we are willing to pay for it. with that, i encourage all policy makers in washington to
listen to your constituents. thank you. >> thank you and thanks to the rest of the panelists. we will do a few questions from the podium and we will open it up to the floor. the first question we will start with you as a political scientist. the study is clearly showing a broad preference across the spectrum of politics to address social security's long-term financing problems contributing rather than cutting benefits in any way. that stands in stark contrast to where the conventional bizdom for sometime now has been that we will never have bipartisan agreements nlz they have the cuts. they have the notion of a
trained cpi which is a benefit cut. my question is, what do you think it would take to bridge the gap between the two? >> that's a good question. lawmakers listening to constit wends, it is interesting when you look at the polls that when polls asked about the follows question without labeling the changes as republican or democrat and not giving the kroous, you see consensus across all political groups. it's only when you start labeling things as the proposal from the republicans or president obama. they think that's the other team's proposal and i must
oppose it. the public who for the most part think when it am cans don't, especially when it comes to a program where the mechanism is as clear as social security. i don't know what it's going to take. interesting, there's been a few instances where even lawmakers realize they have to go with their constituents and not with their party's preferences. if you think back to george w. bush's push for social security privatization in his second term, it was congressional republicans who came back to him and said, just don't go there. my senior constituents don't want to go in that direction. so on occasion there is i think more responsiveness to the public, but, you know, i don't know the real ingredients to get that to work more consistently. >> maya macguineas, do you think it would be possible to do social security reform without cuts of any kind. >> i was thinking about what is
actually possible right now. do i think it would be -- do i think there could be a revenue only plan? well, i think the first step is lawmakers actually get a whole lot of different signals on this. this is a really important study. there are also a lot of other polls out there that have very different results in terms of what it is that people want when they're reforming social security. so there's one i'm familiar with from the voices of people -- microphone, sorry. there's one study out there, one poll out that also says there's majority support, high majority support for cutting benefits for the top quarter of people and that there is support for raising the retire am age for another year. we have a very not scientific poll but we have a social security simulator where people can go on the website and play around and come up with how they would fix the system and raising the retirement age there is one of the most popular things that comes up. now, these are people who would come to a fiscal watch dog website and play a social
security simulator, so i would dismiss our findings as anything but scientific. but i do think one of the things is that lawmakers, one, get a whole lot of different information. so what this does to me, it says let's study this more. again, i would like to put the social security reforms next to an overall budgetary situation so we think about this is a country with so many resources. if you lift the payroll tax cap like we're talking about in this proposal, the top rate would be 59% for high income people. that's higher than most people -- that's looking at income tacks with payroll taxes. that's higher than most people say they support. i think if you do more studying and we come up with more solutions, i think that makes it more likely lawmakers will listen. but there's a flip side of this which is i haven't seen a single issue that has the ability to generate more negative political ads and that's anybody talking
about anything. so we also have to find a way to completely depoliticize or bring down the rhetoric and bring up the truth telling in terms of there are choices, they're hard choices. which ones are people willing to make in order to fix social security. the third thing is i think we're going to have to do something soon, maybe not in the overall social security system, though we should, but disability is going to be running out of reserves by 2016. so there's about to be kind of a forcing moment where we're going to have to figure out how to deal with disability. most people would say that ideally you would do that as part of a comprehensive fix to social security and disability at the same time. i'm not as optimistic as i would like to be that that's how we'll go at it, but at least we'll be talking about disability soon and that will open up this whole discussion. when it comes to revenues versus spending cuts, i think that's the single biggest fighting point that there is on budget politics overall and social security. i think there's more willingness to lift revenues for social security than there are for other parts of the budget but this is the one where everybody goes into their camps and dunn
want to budge and we're going to have to compromise and look at what can pass both parties. >> how do you see this pending discussion about disability insurance reform in the broader context of social security reform that the other maya just mentioned. >> it's happened before where the disability trust fund has experienced a challenge with solvency and we solved it before by reconfiguring how we reallocate the monies across the trust funds. it's been simple before, and it's still simple. we've done it before, and we'll do it again. >> another question i wanted to ask is, maya macguineas, have to keep my mayas straight here. you've written elsewhere, didn't come up so much today, about the idea of means testing as part of social security reform, and i wanted to ask you if you could talk more about exactly how that would work. would means testing social security in your view be a wealth test or an income test of some kind? and what's the justification for
it given the notion that social security -- not the notion, the reality that social security is an earned benefit, not a welfare program. >> okay. so means testing, one, i would say that it is, of course, an earned benefit. we contribute to it, but part of the reason there are problems in social security is for so long people got more out of social security than they put into it and i'm completely comfortable saying social security functions as a program where not everybody is going to be able to get everything they put into it out of it otherwise it doesn't work where you can subsidize people who are low income who live very long. you want to make sure social security is there to protect people who need it, who depend on it, and live for a very long time. means testing to me is such an interesting option. first off, when i don't bring it up at town hall meetings and other places, it's the one that gets brought up the most by people when i talk to them. that seems to be the most popular one when i talk to people outside of washington. it didn't come up here today. but what confuses me about means testing is, again, it's an area that seems to go to this partisan divide where you have generally, just to generalize,
many people on the left don't like the idea of means testing because what they think it would do, and virginia or anybody else can sort of correct me if i'm not representing this well, it would undermine support for the system. so if everybody is not getting a lot of what they put into the program out or real return on their contributions, they wouldn't support the system as much as they do right now. and so there's a resistance from people who are on the left and progressive often times to means testing or making the system more progressive because they worry it would undermine support. is that a fair representation? >> that is sometimes said, yes, that it undermines the support. but i think on the question of progressivity, i agree with your point that it makes sense for the system to be progressive. it also makes sense that not everybody is going to get back exactly what they put in or more. but if we want progressivity then in a clear way one can look is on the revenue side and let everybody pay in all year long
that 6.2%, and in terms of solvency that does a whole lot more than trying to track down a few millionaires to make sure they don't get their social security benefits. so, you know, just as an effective progressivity, you get much more bang for the buck on the revenue side than on the benefit side. >> in fact, that kind of makes one of my points. one of the interesting things is if your objective is to make the system more progressive which i would advocate for. i think one of the keys is to protect people who depend on the system while we figure out how to fix it. people on the left would prefer tax increases. people on the right prefer benefit cuts. at the end, if you're just taxing the same amount or reducing benefits by the same amount it's the same policy with the same distributional effect. it make as difference whether
it's taxes or spending. i have been surprised more people don't like means testing. it makes sense to say as we lift the payroll tax cap you don't need to give new benefits for people over a certain amount contributing to the program. it would make a lot more sense to use the resources to plow them back into social security or somewhere else. >> classic means testing -- >> when you asked how you would do it. the problem with means testing is it creates the wrong incentives. the best way to structure means testing is based on your lifetime earnings so it doesn't incentivize you not to save but says if you were working a lot for your whole life you get less benefits at the high end. something, but not as much at the top end. classics means testing is based on current need as opposed to what you described. this is the issue of what you
did over the course of your lifetime. when i hear means testing i think something different. >> right. i was listening to this question of what it means for public support if it's for high earners and would that under mine support for the program or cross class solidarity. there is evidence that it does which is part of why people on the left are afraid of cutting benefits for high income people too much. the 83 amendments insbro deuced benefits for high income people. if you look at support for social security over time by income level the gap across income levels did widen after that change. the gaps were narrow before the change and higher income people became less supported after the change, after the program became
a worse deal for them compared to what it attained previously. there are legitimate concerns about means testing. by whatever means that's carried out. >> can i ask a question? >> i wonder if you reduced benefits other than taxed them if there would have been a different response. i wonder if that brought down popularity more than if lowering the replacement rate. >> introducing taxes is much more visible.
>> i wanted to alert the audience we'll go to your questions after. so if you are thinking of a question, get ready. >> it's always interesting, the notion of means testing, social security is a popular question i get on the washington cocktail circuit, particularly where a lot of high net worth people are in the room. with a glass of wine in hand, they will come up to me and say, we and my friends -- me or -- neither i nor my friends need social security. why don't we just means test the program so high income earners don't receive it. then we'll solve the issue. and then i come back and say, you know, this is social insurance. the concept of insurance is fundamental that you pay into a system of insurance so that when
you experience the need, you can get it. sometimes the need doesn't happen over a lifetime. but sometimes that need actually happens. what do you do if you don't have it. is anybody suggesting that high net worth people don't need to purchase homeowners insurance? high net work worth people purchase insurance. they purchase it in case they experience a fire. let's take it back to the concept of social insurance. what's the fire that faces high net worth people in the context of social insurance. can anybody say bernie madoff, enron. there are madoff millionaires who one day had a lot in the bank account and the next morning woke up destitute. many of them, unfortunately, were seniors. heaven forbid if they had no alternative, nothing to rely on.
the issue of means testing social security should be a moot point. there is fairness up and down the income scale. that means we need to make sure the protection is there regardless of what your net worth is in case the fire comes. >> i have seen social security is important pretty high up. you often hear warren buffett doesn't need social security, that's correct but that's a distorted way of looking at it. how many are there? not many. they have spent down everything else. did you have a comment? >> i was thinking it was making the point that i thought means testing does.
it needs to be a plan that pays you benefits if you don't need them and you are going to cocktail parties where people say, i don't need this and i want to give it back. it's not going to fix the program, means testing on its own. you have to make a lot of other changes. you have to bring revenues into the program. that seems like a good option. >> i do tell them that. you can go to ssa and you cannot even apply for it. >> you're talking about a current need versus we were talking about the idea of means testing against the earnings of a lifetime. i still think there is confusion around what we mean about means testing. >> there are many ways to structure a means test. you want to do it carefully and thoughtfully. >> let's open up questioning to
the audience right here. please introduce yourself briefly. >> i'm phil gilliam here representing myself. my question is how many candidates in the upcoming november election will mention this in campaign ads, campaign speeches. means such as that. >> we'd be glad for you to share it with as many as you can. >> there is a fair amount of it going on in key battleground states and peculiar thingses are going on.
we are seeing attacks on democrats by republican super pacss from the left. accusing democrats of being weak supporters of social security because maybe at one point they said something nice about simpson bowles in the past. the ads will say, kay hagan wants to raise the retirement age because simpson bowles said we should do that. she once said, yeah, take a look at simpson bowles. there is a lot of distortion. no big surprise, going on in tv advertising in the race this year. that's unfortunate. >> i don't think i have seen any ads of people talking about specifics of how they would fix the program which is the problem. >> i would like to add there begin to be more specific social security proposals that do come up with responsible cost estimates that include paying for the system. and some modest benefit improvements. >> and some candidates are trying to run on that. alaska is the best example. another question. do we have time for one last? >> a question for mya.
>> wait for the microphone. >> which mya? >> specify your mya. >> i'm from social security workses. you say there is a scarcity of resources and you support revenue as part of the solution. because of budget constraints there is a limit and so forth. at the same time you admit there is a retirement security crisis and say people need to save more. why do you think there is money for people to put more in the 401(k) but not to contribute payroll taxes to fund social security? wouldn't it be more equitable to have it go through the system rather than having wealthy people get a bigger tax deduction to contribute to 401(k) and iras? >> great question. the main resource constraint the political. we are not going to tax 100% of the economy. we're probably not going to tax 90%, 80%. i don't know where the limit is. what is the best use of resources given how many things are under funded. you have to look at social
security, all the competing things. in terms of saving, i don't know which is more progressive. you could make a personal saving piece. not talking about social security but private saves. you talked about tax breaks. there were ideas i have had for quite some time. progressive savings like mandated savings of x percent. of your income. on the low income end of the scale you would receive government matches. i guess the question isn't just what the limit of how much people are willing to pay in taxes is. it's what things they would most want to give it to. if people are more encouraged to have ways to have savings than going into social security, that would be something you would get more revenues. if they prefer social security that's where it goes. it is a political limit of that
people are only willing to pay only so much in tacks. the more you pay it is detrimental to the economy. >> i want to speak to a misunderstanding in terms of the way this is framed. people look at social security and medicare and say we are spending all this on seniors. we need equitable spending on the low end of the life scale. that reality is it's important that you have babies on social security, you've got teenagers on social security, middle age adults on social security and seniors on social security. there is not a trade off. this is an important program
across the life scale for all americans. we should not pit social security against pre-k for example. when i say that's a pillar of progress, what pillars do for houses and this is the house call to america, it holds the house up. if you destroy that you bring part of the house crashing down. we can't afford to put social security on par with the rest of the budget. it needs to be considered its own portion. that said, if you're looking at the rest of the budget, aside from social security and medicare then certainly there are important things we need to do with regard to shifting
resources to invest in younger people. one is looking at defense spending. thank you. >> any other audience questions? >> to ben's question, one thing about encouraging private savings is wonderful. but each household is its own risk pool. how much money extra do people have to put aside. we have a third of households who make up two-thirds of the poverty level. they don't have extra money for private savings. programs that incentivize private savings makes it is the affluent more affluent and doesn't help lower income folks. if we increase the payroll tax by 1% as this poll suggests would be supported by americans then we can use the entire nationwide pool to redistribute a little bit more from higherers to low. they don't have success income to put aside on their own. >> there are different variables. we want to talk about where the will to put more money is. there is an economic consideration. it's good for the economy. we don't have a high savings rate in this country. one of the problems with social security is we haven't figured out how if we prefund it, put
more revenues into the system we can wall that off to increase national savings. it's been unclear and it seems they didn't increase net national savings. we haven't come up with more ideas. you would like to see it increase national savings. that would be good for the economy as a whole. >> we do believe we theed to increase savings as a form of wealth for particularly low income, low net worth households. so child savings accounts is something we are in favor of. baby bonds where you create accounts that allow children to acrew interest and earnings over a lifetime. these are things we are in favor of. outside the social security system. there is a lot we can do for asset building in communities of color and low income populations.
it's an avenue we should consider. >> the baby roth ira account has been proposed a number of times. it's an intriguing idea. even with a small investment of dollars when a baby is born those dollars compound tremendously over a lifetime. any other audience questions? i have one last for the panel which is confidence improves. it made me think as a member of the media what do you think of the media's role here in trying to inform the public better and what kind of grades would you give the press in doing that?
>> it is no secret that the american public has been done a severe disser vis when it comes to accurate information. particularly social security. we allowed partisan politics and the message and talk points to guide the narrative. regardless of the facts in many cases. that's what's perfect about this report. they seek to educate the american people about the facts,
just the factses. they find that when the american people are informed they make different decisions. we have to educate the media. the -- professional journalism has been decimated and many organizations are operating on shoe strings and people don't have the expertise they need to report accurately. we have to make sure they can discern the information and explain toyota people. virginia, you have been an expert here for a long time. getting better, worse in terms of press coverage? >> i think perhaps the it is press is beginning to get better. for a long time the story about social security, its strength is
its own enemy it's so fiscally responsible every year a trustee's report looks 75 year spos the future and says how are we doing? this system can't borrow money. it hases to pay for itself by raising taxeses or cutting benefits if it should get out of balance. through that fiscal responsibility the story every year is when is it going bankrupt? well, it's not. it has a short fall. it's time to talk in a different way. >> a couple of years ago michael astrub was begging journalists to understand the term exhaustion and not to use the term bankrupt. sure enough all the stories were
social security is going bankrupt. there is no winsing. >> it's important. the trustees look forward and say where we are going. the trustees are saying there is an imbalance. it's not like this is a perfectly rosy situation. go read the trustee report. some of the best information -- the congressional budget office puts out great information if people want to learn impartial stuff. you can learn more than you have ever wanted to know. if you go to the fist documentses it's a great place for people to start. >> great point. i think we are out of time. we need to wrap up. let me remind you about filling out evaluation forms. let me thank the panelists for doing a wonderful job. thanks to the academy for
convening us this morning to hear about the important new study. thanks and have a good day. here's a look at what's ahead today on c-span 3. next a discussion about stolen assets from middle eastern countries. then the world affairs council on the future of the u.s. army. later a look at recent negotiations over iran's nuclear program. here's a look at our prime time programming. here on c-span 3 at 8:00
eastern, a look at how one community in america is handling the influx of undocumented immigrants. they describe efforts to provide education and health services. the center for immigration studies host this is event. on c-span 2 at 8:00, it's a discussion on government. steve simpson, an attorney and director of league studies at the california institute shares his thoughts of a hungry mind speaker series in colorado. and tonight on c-span, it's interviews with retiring members of congress. feature iowa senator tom harkin and north carolina republican howard coble. this is part of our week-long series. this thanksgiving week, c-span is featuring interviews from retiring members of congress. watch the ber views through thursday at 8:00 p.m. eastern. >>. i have often said the republicans have a legitimate
argument and they are not being maebs because they filibuster bills. the best way is get rid of the filibuster but at the same time guarantee new rules for the senate. the minority will be allowed to offer amendments to any bill on the floor. to that legislation. which reasonable time limits for debate. >> the i won't even qualify the most eloquent order of the congress. he said i'm not wild about this. he said there are 23 americans serving active prison sentences for having committed perjury. he said how do you justify that and then turn a blind eye to the
president. he said i can't do it. i always remember him saying that. >>. and also on thursday, thanksgiving day, we'll take an american history tour of various native american tribes. that's at 10:00 a.m. eastern following washington journal. then at 1:30, attend the ground breaking ceremony of the new diplomacy center in washington with former secretary of state. and justices at 8:30 p.m. eastern. that's this thanksgiving week on c-span. for our kplut complete schedule, kbo to c-span right lane. now a conversation on attempts to recover the assets of dictators over thrown in the arab spring. dictators from egypt, libya and tunisia allegedly held billions of dollars stolen from their
countries. most of the money has not been recovered. from the center for strategic and international studies this is about 90 minutes. >> good morning. welcome to the centers for strategic and international studies. i'm the senior adviser here. it's good to see lots of friendly faces in the audience. thank you for coming. for those new to the new headquarters, i know some of our panelists have -- this is their inaugural visit here to csis headquarters. welcome. hope you enjoy the space. we'll have a reception.
we hope unyou can mingle with ore panelists. we hope you can join us. welcome, again. we are being joined via live stream on internet as well as c-span. keep in mind that you're on tv as well as we are. behave. we are very excited to not only be hosting this panel. the panel entitled returning stolen assets, current issues and future challenges. i'm ecstatic to have the panel here. i could not imagine a better set of experts to speak to the range of past, current and future issues and challenges. let me set the stage in part because we gathered about two years ago -- actually, valentine, jay and i. emil, you weren't with us, unfortunately. we talked about the arab spring and with much hope what was to come.
not just from the return of assets from autocratic states in north africa but what was happening systemically around the world in dealing with high-end corruption and the mechanics of asset recovery. these issues are not new, of course. from the days of ferdinand marcos, to others, these are issues and regimes and themes that are with us and will be with us for a number of years. but what we wanted to do today is to talk about where we are as an international community in the u.s. on dealing with asset recovery. in particular, in the wake of the arab spring and some of the disappointments, in the wake of the tumult and politics and transition in ukraine, and in light of some of the recent cases, in particular brought here in the u.s. and certainly we've seen internationally.
that's what we wanted to do today, have an open discussion and that's exactly what we're going to do. we're not going to present speeches. we're going to have an open discussion. then an open discussion with you. we'll speak for about an hour among ourselves. then open it up for questions and dialogue with all of you. with us, as i said, a world class panel. i'll introduce them to you. you have their backgrounds and bios so i will be brief. to my left, ambassador valentine zellweger. very good friend of mine. legal advisor, in essence in charge of all of the swiss government's efforts on asset recovery. seen as a real star in these efforts. >> happy to be back. >> to his left, jay, section chief of the asset forfeiture and money laundering section of the department of justice. jay is the general on asset recovery for the u.s. government
running now the cleptocracy and asset recovery initiative for the department of justice, bringing some very high-profile cases even just in the past couple of weeks. jay has deep experience. i won't give you his deep background because it is embarrassing how impressive it is, but he is the u.s. expert on these issues. to his left is -- emil, forgive me with your last name. i'm not very good with it. the legal advisor to the world bank's stolen asset and recovery initiative, a better piece of the world bank's efforts to deal with all of the systemic and technical and capacity issues around asset recovery. a long standing expert, published proficiently and profusely on these issues and a world recognized expert. so you do have three of the world's experts. i'm here to be a simpleton moderator and hopefully will drive the discussion in an appropriate way. so let's begin.
valentine, let me start with you. we sat here two years ago and were talking about the hopes of asset recovery in the context of the arab spring. from your perspective, what has gone right, what has gone wrong, and where are we on these issues, at large, as an international community? >> that's a good question. a lot has happened in the past few years. the most important things that have happened is that asset recovery is now very much on the forefront of international news. switzerland, the marcos case, an example. we then started to be proactive on asset recovery for about 28 years. for a very long time we worked on all the cases you mentioned. all the cases can you mentioned
were swiss cases. by did so because we were under pressure. we recognized that. the financial sector was under pressure, have to do something. but for a long time we were pretty much alone in the field. that has radically changed we talk about groups of people. we have 30 to 40 former power holders in these countries. that's the first difference. the cases are much more complex, much more challenging in solving. but the most important change is that there is a recognition not only in those countries but also in the financial centers that we have to work together. for example, we have you several
international conferences in the context of the g-8. there are initiatives to cooperate among all requested and requesting jurisdictions, which means all the partners involved. we've never had that in the past. we always tried to solve cases bilaterally. now we all work very closely together with the world bank and i think that is an extremely important development because now i come to the -- your point that we may not have made the progress we hoped for. i disagree with that point. i'm sorry to start with a disagreement -- >> no, that's good. >> we shouldn't have hoped for more progress to give it up. i don't know exactly whether we hoped for more progress.
because that's still one of the remaining challenges, these cases take a long time to be solved. if you look now at the progress we made in some of the cases, if you take tunisia, for example. the twist prosecutor. general decided to sell back two-thirds of the funds we had frozen in switzerland to tunisia. that's only after three years. we never had that in the past. the quickest case we've had so far -- don't know if you perhaps have more rapid procedures -- the quickest case in our history took five years. we were efficient because we had an excellent cooperation with nigeria in that case. now in tunisia we solved the case within three years, and i think that in part is also due to an excellent international cooperation. we could solve the case because
we have close cooperation with tunisia but also because we worked with other jurisdictions. and in order to collect all the information you need, that's the best approach. so i am pretty confident for two reasons. first, asset recovery is now a topic on the international agenda. and second, international cooperation has usually increased over the past two years. i think that is a very important development. >> your point about this being a north-south issue now where it's not just seen as an issue of the affected countries or the corruption in the developing economies or countries.
but it's now an issue for the banking centers and the west in many cases to actually address. i think that's a key thematic shift that you've seen. >> to some ex tent. it's interesting. talking about the north-south issue. we do know in the context of the arab spring, there are huge sums in financial centers. our partners in tunisia tell us in the cooperation with the north is much better than with some of the southern financial centers. that is something that we certainly will have to work on because we will have to create the level playing field. i don't think there will be great use in the big financial centers like the u.s. uk also switched its policieses. uk is much more proactive than they used to be due to a bbc program they aired in 2012 that severely criticized the uk government.
they have really come around. they're very active today but i don't think that's enough. we have a close cooperation. we should extend that cooperation to southern financial centers. >> jay, can you speak just a little bit about sort of the shift in the u.s. approach even over the last couple of years, and maybe take us through this latest case which has gotten so much attention with the seizure of the malibu mansion and the michael jackson statute and the rest. >> sure. i think it is important to recognize that there has been a shift but it's hardly been a shift more in efforts than desire. the efforts to recover stolen assets on the u.s. side goes back many years to the '90s. we have cases going back years. i think what changed about four or five years ago was a concerted effort on the part of the u.s. government to devote resources to develop expertise in the core of prosecutors who can bring these types of cases. so the attorney general, going on four years, launched the asset recovery initiative. i think that was a recognition that at least with the legal system that we're working with in the united states, asset recovery is a judicial procedure. there are blocking statutes, blocking mechanisms that. are built by the department of treasury but that's not -- those
aren't actions that can lead to recovery of assets and return of assets because they literally are like a dam. it prevents assets from flowing to the affected countries, but we can't use that as a mechanism to take possession and then return those stolen assets. so in the u.s. that's done through our forfeiture laws, predominantly civil forfeiture laws, because we're dealing with situations where the individuals who are responsible for misappropriating these assets might be outside of the criminal process that the u.s. connection is either as a legal matter or as a practical matter in terms of extradition, et cetera. so we really focus on the use of civil forfeiture, aware what we have to do is tie the assets to a crime. you don't have to prove that somebody did the crime but you do have to tie the asset to the crime. that requires sophisticated financial investigations where we can trace money that emanated from a corrupt act to the asset. proving that case takes specific
evidence and that's really where the game is. can we collect evidence that evidence is located i understandly. the crime scene, if you will, is the country in which it occurred. if that country is cooperating, that may help but the events may have happened a long time ago. the countries not cooperating, that layer has an additional layer of complexity so you may have to get witnesses who are located in third party countries who might be willing to talk. you then have to get financial records. and cooperation i think has improved tremendously over the past few years but we still have issues in terms of sharing financial records, getting financial records that can then be admitted in court. i think with the rise of some of the data privacy laws that we've seen around the globe, that's actually made it more difficult. they have valuable assets, but they make it very difficult oftentimes to get the financial
information that we need to prosecute these cases. then you have to put it all together and convince a judge that these are valid cases to be brought and should result in forfeiture judgment. then you've got some of the politics around it. people question whether forfeitures are useful tools or not. for me, i would say yes, it's one of the most valuable tools we have to attack corruption and criminal conduct. all of that is a long way of saying that the recognition, we couldn't do this in the u.s. with people doing it part-time. we had a lot of prosecutors that were doing this and other types of cases, but if we were going to bring these types of cases we needed a dedicated core of prosecutors to do it with sophistication and financial investigations, and sometimes an organized crime. we're talking about cleptocracies are sometimes criminal organizations that masquerade as governments but
are really expropriating assets for the benefit of themselves. so you need the skills of a financial investigator, of an organized crime prosecutor, courtroom skills. the whole gamut. you need to get sophisticated, trained people who can do this. because on the other side, i will tell you, the best firms are representing the claimants in these cases. so the people we have to go up against are some of the best of the best. that's the game that we have to play. so right now the department has devoted ten prosecutors to this unit within my section who work exclusively on these cases. in addition, the attorney general just announced in
february the ukraine asset recovery forum the creation of a specific fbi squad that will focus on these cases and especially in cases that are occurring in real time, as you mentioned. what has changed is we can now respond to events that happened on the ground as opposed to going back 15, 20 years trying to piece together the puzzle. that makes a huge difference. i think that's really what's changed, is a recognition of what it will take to win these cases. and it takes a while. perfect example, a case was filed a number of years ago, pretty much on the -- very soon after the initiative was
announced. but we were dealing with a government that was not cooperating with evidence that was largely located in the country. financial records that had to be obtained but also pieced together through a web of complex shell corporations that hid the true ownership of these. and at the end of the day assets that we might or might not have been able to get our hands on. and so i think one of the hallmarks of the settlement that was reached was that we managed a essentially forfeit or acquire, through other means through the settlement agreement the value of all the assets that we have the potential of getting to extract an agreement that there would be no further assets brought into the country, and if they were, this was not prospective immunity of any sort. it was an understanding that if for some reason the claim we'd never get our hands on comes back into the country, we will reserve the right to go after it. if other assets come into the country we will continue to proceed. but i think we shouldn't
underestimate how difficult a job this is. these are complex civil litigation cases. we have to recognize that if we want to do this right, then it may take some time. a part of what we're trying to promote is a rule of law. it doesn't make it does us any good i think if we acquire these goods in a way that violates those basic tenets of fairness, due process, et cetera. it takes time. i can tell you this from the perspective of a prosecutor but i also appreciate there is then public buy-ins, there is legitimacy to what we've done. it doesn't look like we're running kangaroo court. we win some, we lose some. i think that in and of itself is a very important lesson to countries emerging from different types of political circumstances. >> we'll come back to that case. there are some interesting lessons from that, of course.
recall talk to us about the evolving world bank role. the star initiative is relatively new and talk to us about that. then talk to us -- well, speak to us from your perspective what you've seen the last -- more resources they've talked about, more focus of experts and prosecutors. valentine's talked about politically much more focus on these issues and much more attention in banking centers. what's your perspective on all this? >> thank you. yeah. i'll just give you a bit of a background on what this asset recovery initiative really is. it is an initiative as the world bank and the united nations office on drugs and crime, really to help countries requesting and requested countries to put in practice chantry 5 of the united nations convention against corruption chapter 5 is on asset recovery and based on the principle that countries will return the
proceeds of corruption back to the financial centers will return the proceeds of corruption back to the countries who have suffered from corruption. and we do that in a number of ways. we started off very much i think on the more policy level advocacy level trying to put asset recovery on the map. there is a big asset recovery handbook trying to make people aware of all of the pitfalls involved in asset recovery. trying to be a bit of advocacy as well, what are the barriers to international asset recovery. what are the legal barriers. what should countries be doing to demand those barriers, to break through those barriers, on the topic you just touched on, trying to push the envelope on beneficial ownership. the misuse that's tk made needs highlighting of shell companies in both onshore and offshore jurisdictions. we started very much trying to
push policymakers. i think in the wake of the arab spring and now after the events in ukraine we've become more focused on working directly with countries together. building capacity in developing countries on how one conducts financial investigations, how one reaches out, what are the typical conditions for mutual legal assistance, basic step by step stuff, but also -- and the arab forum on asset recovery is one of the examples of that, as with the ukraine forum on national recovery, trying to provide a bit of a neutral venue where requesting and requesting states can meet and discuss the issue of trust is very fundamental, i think, to successful asset recovery. certainly if you looked at the experiences just after the arab spring, there was a perception in some of the countries that if these financial centers were happy taking the proceeds of our former rulers, why should we trust them now?
why would we work with them now? why would they help us? so trying to, on both sides, act as a broker and bring the parties together i think has been an increasing part of the role of the stolen asset recovery initiative. it's from that sort of perspective when you ask me to highlight some of the issues. if you look at the landscape of asset recovery, it is through that lens that we look at it. first point, absolutely, are the attention given to asset recovery is quite effective here. there was the united nations convention against corruption and that -- i think the financial crisis has helped particularly fiscal authorities zero in on the abuse of shell companies for all sorts of purposes. that's in no small measure. think civil society.
i see some civil society here as well has contributed in no small measure. i think for a variety of reasons we are -- we are now seeing increased attention at the political level and elsewhere on the issue of asset recovery. that's not just words, that's not just paying lip service. that's also putting in place the sort of task forces that dave was talking about just now. the unit that ambassador zellweger referred to earlier. you have a number of dedicated police officers -- this is in the uk example -- specifically focused on the proceeds of corruption in the london finance system. those sorts of things, and for sometimes asset recovery units sometimes it is just about breaking down boundaries between passive governments that used to make work too much in silo, the
financial intelligence unit may be connected to the corruption unit which may not be tied in to what the regulators are doing. i think breaking down those boundaries between different parts of government is very much something that we've seen and it's translated into legislative action as well. asset freezing recall, legislation that many countries have adopted. so a holding measure. e.u. has done that. switzerland has done that. just after arab spring. a list of these persons, freeze their assets now. it is not a judicial freeze in the context of judicial action. it is an administrative freeze giving the countries time to prepare their judicial action.