tv American Perspectives CSPAN October 2, 2010 11:00pm-2:00am EDT
this must change. we must do what we do in our best schools and all of our schools for all of our children. ,nd america's teachers thousands of whom are here today, let me hear you. [cheers and applause] america's teachers work hard every day to make a difference in their students' lives. but teachers cannot do this alone. teachers, parents, community activists, they are our everyday heroes. but even heroes need help. giving all our young people in strong start and an equal shot at life. this is why you have a teacher and a minister speaking with one
voice. the teacher from new york, the preacher from the south, because the schools in your community are your schools, whether you have a child in them or not. no more will we speak of those kids or other people's kids. our kids are our kids. america's parents and teachers work hard every day to make a difference in our young people's lives. we ask you to join in this quest. excellent public schools are the cornerstone of our democracy. our elders depend on future generations. today's students will be the caretakers of the environment. the spark igniting our innovation, the candle of our
global revolution, and the creators of our art -- every child has the right to a fair and hopeful start in life. brothers and sisters, we have a choice. we can follow our aspirations or we can give in to our fears. we, here today, aspire to our ideals. we, here today, must help our children, not only dream their dreams, but achieve them. we, here today, must invest, most of the best in our kids. we, here today, must enter in a new era of excellence and equity in america's public schools to achieve this promise for all kids, not just some. we can do it.
we must do it. and i ask you to join america's public school teachers in our quest to make a difference in every child's life. let's stand together, one nation together. [applause] >> thank you for your commitment, your compassion, and your courage. the great queen of the civil rights will struggle, in this life, a few touch someone with your finger, human and get their attention. but if you bring your fingers together and form a fist, you can strike a mighty blow. we are here today to strike a mighty blow. whenever this nation has made progress, we brought our fingers together. in the revolution for freedom, we brought our fingers together.
we struck a blow for emancipation from harriet tubman to abraham lincoln. we brought our fingers together and struck a blow for freedom. martin luther king, dur, we brought our fingers together and struck a blow for freedom, justice, and liberty for all. what are we safe for our children? we want to bring art changed -- bring your fingers together and strike a blow so our children can have the best education. shame on our nation when the possibility for our kids is determined by their zip code or economic status. it is a new day for america and we will bring your fingers together to strike a blow for all of our children, regardless of where they come from, so they can receive excellence in
education. i stand with randy. i stand with the american federation of teachers and say let's bring our fingers together, union, faith communities, civil-rights organizations. let's bring our fingers together, red, brown, yellow, black, and white. let's bring our fingers together and strike a blow for justice. when we do this, we will lift up our nation. when we do this, our best days are in front of it. let's bring our stinkers together. but strike a blow. walk together, children. do not get weary. let's bring our fingers together. [applause] >> police will come -- please
welcome beau cia. >> teacher, teacher, there is some much want to learn. teacher, teacher, you do not have to be board certified. this hand is being raised for everyone knew -- for everyone who is willing to say they are my teacher. i learned more from lessons plan. like a child, i want to understand more than a quadratic formula. like a child, i, too, and part of the future, the future being shipped all around me, the future being shipped by you, my teacher, whose choices will show me whether or not we will continue to resort to wars and answers. we will continue to see individual gain and communal gain as separate or if we will
ever find solutions for problems that go way beyond multiple-choice. teacher, how can you ignore this moment in history, calling you out, demanding that the best of you rise to the occasion, so that you can become the teacher we have been -- we need in timth times like these. we cannot ignore that we must educate each other better in order to make that statement true. whether or not we are listening, the children are. as we are working towards improving literacy, math, science, scores, let's also work towards giving literacy in power
beyond reading, math beyond endless numbers, science, world worth exploring with grand possibility. let's also value the results of helping another in need, of encouraging within ourselves something larger than career, and listening for that raised hand everywhere screaming everywhere, a teacher, teacher. and like a great teacher would say, i believe in new. i do not care if you never tested good before, i believe you can teach a better world into existence in every moment of your life. as you are struggling, just look around you. there are teachers everywhere, patiently urging you on, ready because they know that you can get better grades. the report card of your life is not out yet. the future children and all is
>> i am happy to be here with agree -- with gregory, the director of civic asian american alliance, the first and only national alliance for asian members. he is the former president of the united states student association and committee member of the generational alliance. good afternoon. good afternoon. i am margaret maryanmoran. the league of united latin american citizens. [applause] it is an honor to be here today, at the one nation working together march, and to stand
united with diverse coalition members. i have a special opportunity to share the stage with my --league gregory's and data gregory cendana. today, we stand with veterans, youths, faith groups, labor and business leaders, new immigrants, and citizens who demand jobs, justice, and education for all. we want the opportunity for hundreds of thousands of our
youths to contributor tolerance to our economy and our armed forces. -- to contribute to our economy and our armed forces. we want these top young leaders to obtain higher education degrees so they can access advanced career opportunities and fill the gaps in high-demand career fields. such as medicine, education, law, science and technology. we want all residents of our great nation to have the opportunity to achieve the american dream. [applause] by bringing students out of the shadows, they will contribute to the u.s. economy, pay taxes, and become productive members of society. [applause]
at a time when the u.s. armed forces are in need of recruiting new and young volunteers, the dream act will allow qualified youth who wish to join the armed forces to have that very opportunity. thousands of eager and qualified high school graduates will be able to fill the military ranks and strengthen both our military readiness and national security. we stand today with our asian- americans, african-americans, native-american, arab- americans, jewish, gay and lesbian and and trans gender and latino members to ask congress to help achieving a immigrant
youth who only know the united states as their home and contraband in -- as a home. latino power. [applause] >> thank you again, margaret, for that. thank you for discussing the federal dream that that continues to be an issue. many organizations continue to see it as a party. it is a privilege to join you in hundreds of thousands of people across the country for one nation working together. it is important to not only pass important pieces of legislation, but to continue to fund k-12 and higher education at both the state and federal levels. we must provide these educational opportunities to maintain our competitive edge in
this growing global economy. additionally, these resources must be targeted to help population and communities in the greatest need, including youths, people of color, immigrants, working class, and the lesbian, gay, bisexual and tranceand gender members in this country. i'm you to talk about something bigger, something visionary, something broader. it is my hope that we will begin to understand that our communities and our country is changing and i believe changing for the better. we have more -- we are more diverse. we are equipped with more tools to organize their peers and are moving in a direction of progress. [applause] the other day, i was joking with some of my colleagues who said i am one nation. as someone who comes from a
union family, who comes from an immigrant family, who was the first-generation college student with more than $50,000 in debt, who is an openly gay asian american -- i represent a diverse range of constituencies here. we also have to remind ourselves that there are many people who could not be here today. we can no longer work in silos, whether by campaign for may's your community. there has to be an understanding that the fight and struggle for economic justice and workers' rights is the same fight and struggle for lgbt equality and civil human rights is the same fight for an injustice and access to quality education is the same for an environment and green jobs, at any jobs at all. it is important that we embrace
these differences, but also remain grounded in love, in respect, and humility. it is only then that we can truly be one nation working together. i want to do one more thing before rigo. i want you to join me in a really quick chant. when i say "can stop," usa "no stop." >> i am honored to stand here today with congressman luis gutierrez. as a nine-term member of the house of representatives, he has
shown tirelessly to ship in championing the causes -- tireless leadership in championing the causes for education and consumer protection. he is an etiquette -- he is an energetic spokesperson for his constituency and has earned widespread acclaim throughout the nation. >> the mission of the national gay-lesbian task force is to build the grass-roots power of the lgbt community by training activists and advancing legislation. ipper is the acting director of that fine organization. >> thank you. i stand here as a proud openl lesbian african-american. i am either black or lesbian.
i am both and so much more. i know that i am not alone here today. there are so many more here, just like me, and across the country who are just like me. and like you, i seek justice for all of us. in america, justice means equal rights for everyone, regardless of race, ethnicity, class, sex, gender expression, sexual .rientation or ability it means stemming the tide of anti-immigrant extremist behavior. we are so proud that last year congress passed the math to shepherd and james bird act. i hope that we never forget those two men and the hundreds
of others who died at the hands of a tree. matthew shepard was killed for his gayness and james berg who was killed for his blackness. yes, our communities are tied together. we stand united against hate crimes of any type, against anyone. [applause] justice also means not turning our backs on the hundreds of thousands of black and latino and other people wrongly incarcerated each year. our system is broken. in 2010, we are adding more beds to our prisons than seats to our classrooms or jobs to our economy. the time is now to promote justice and fairness for all in this country. i know that we know that
production from employment and housing discrimination continues to elude so many of us. we have been invested in their communities by educating our young and caring for our elders and ensuring that all their families -- all of our families arrive. it is the diversity of this nation that makes our nation so great. diversity is our greatest strength. our youth, be they bisexual, straight, gay, lesbian, questioning, immigrant, transgender or other, they need love and acceptance and quality
education and safety from bullying of any type. our youth need hope. for the young people who are being bullied and harassed, as a person who came out as a teenager, i want you to know that it will get better. [applause] let's pave the road to independence and -- so that youth suicides never happen again. we will have achieved justice one, regardless of sexual orientation, gender identity, age, race, or ethnicity, we all have freedom from discrimination and equal access to jobs, justice, and education. finally, i want to say to you, representative gutierrez, thank you for working for justice for
all of us. thank you all. one nation! >> thank you. today, i want to talk about two important words -- "hard work." i want to talk about the men and the women who cleared the dishes in restaurants, the woman bent over sewing machines making our clothes, the women caring for america's children -- it is hard work. they come to our nation to work in sometimes demeaning jobs, to do hard work. we do not see many pictures of the immigrants sweeping the floor in the hospital or caring for a sick child. but we see lots of pictures of scary invaders jumping over fences or prisoners in handcuffs. far too many people -- the first two words that they think of
immigrants are "go home." it is hard to replace them with two words that tell the hart story -- "hard work." the struggle for fairness for justice for freedom is hard work, do. protecting our civil rights is hard work. our immigrant struggle for civil rights is born of the african- american struggle for civil rights. the latino and immigrant struggle is not a reinvention of the civil rights movement, darlene. it is the continuation of the civil rights movement, growing bigger, growing stronger, picking up and new allies along the way, helping each of us, letting everybody know nobody will turn us around. we cannot achieve justice for immigrants without the words and actions of dr. king and his
brothers and sisters. you see, you deny gets -- you do not get sonia sotomayor without thurgood marshall. you do not get roberto clemente that jackie robinson. and you deny get comprehensive immigration reform without civil rights for all in this -- and you do not get comprehensive immigration reform without civil rights for all in this nation. together, we will get comprehensive immigration reform. we know that the part of moral universe is long, but it bends toward justice. we know it is true. we have seen it. darling, it used to be illegal
for workers to form a union. it used to be illegal for women to vote. it used to be illegal for blacks and whites to attend the same schools. but because we did the hard work, and the art of the moral universe vent. it bent towards workers' rights, voting rights, and housing rights. but right now, today, it is illegal for millions of people who live in this country to come out of the shadows and enjoy the prosperity of their hard work and the responsibility that comes with citizenship. we are here today to work hard, to keep bending that art that watches over every immigrant in this nation. i will not stop fighting until we turn on the news, even fox news, and see the pictures of emigrants doing hard work and making america a great. the fight for justice and jobs and civil-rights is a movement, a family of workers, of straight men and a women, of asian and
african americans, of every immigrant in our nation. abraham lincoln, the man we built this memorial to, understood it already 150 years ago. a nation divided against itself cannot stand. together, as a family, we will rise up and we will stand and we will run together toward justice for every american, whether they were lucky enough to be born here or ambitious enough to come here to make this land their own. it is hard work, but we can do it.
>> as president of united auto workers, bob king is known for his activism and passionate beliefs and social and economic justice. he is a visionary and innovative leaders for an industry that desperately needs both. >> labor and environmental leaders need to work hand-in- hand. that is why i am very proud to share this stage today with mpkin, one of theagai nation's leading advocates for a green economy. >> thank you, bob. i stand here today on the shoulders of my nana. two years ago, i stood with her here on the small.
through tears, she watched as the first black president was sworn in. the power on that they did not stem from rice. it followed from its old acknowledgement that this country belongs to every citizen. that january day meant it was possible for our children to be anything they wanted to be. that they meant that there was no longer two american dreams. for some people, it is a scary thought, the fear that opportunities exist for others. it means that opportunities do not exist for yourself. they would rather have us all in darkness and then have us all see the light. it used to be that those who opposed us made us feel as though we had been stumbling along in a darkened room in an unfamiliar environment in our own country. we were made to feel alone and isolated. every once in awhile, they picked a few of us to share
their light and took pictures to show the rest of us that their american dream might someday be ours. but it almost never was. today, we say that no one should feel that they are in the dark. today, once again, it feels like we are seeing the light turned on. today, no longer will we follow alone in the darkness. today, but for this crowd, i am delighted. are you blinded by the amazing spirit and will of the people today? [applause] that is pretty depressing. are you ready to stand and say this is our country? >> yes! >> are you ready to say that patriotism belongs to those who love the country? that love in the country is about recognizing that people deserve love, regardless of who they love, where they're from, where they are born?
that this is the vision for the country that we believe in? i want to say to you that i am thrilled to be here with president bob king. but this is what this country will think about. after the serious brutal blows that this country has taken over the past five years, we have two choices. we can give up or we can get up. are you ready to get up? >> yes! >> giving up is not our option. by our presence here today, we say that we are ready to get back on our feet, that we will extend a hand to whoever around us needs help rising. the last time our country faced an economic crisis, the great depression, it did not destroy us, but it left us stronger. that is the vision that bob and i share. i know what the allies of darkness feels like. i know when it feels like to not feel at home in your own country. but if we want our fellow
citizens with -- this country judges without knowing yes. notone said to me thyou are a real patriot because you believe everyone has a right to come to this country. you believe workers have rights. but we're here to say that this is our country. this is our experience. this is our america. no longer will we allow anyone to say that you are less of an american because of the color of your skin, the state you were born in, or the work you do. no longer standing in the light of the brilliant crowd that is a true portrait of america will we allow anyone to say what an american family is or is not. if you undermine my patriotism, diminish my american story, you diminish the american story of millions of others, of my nana who stood on the small and cry, my grandfather, and my mother.
people said, what are you doing? we are standing up to not allow any american story to be diminished. we are here to stand today with a crowd to say proudly i am the face of america as much as you are the face of america. from this moment onward, we will never except anyone telling us the differently. >> yes! >> good job! >> thank you. [applause] >> what she embodies for me is the hope and optimism that we have to have. those who want to divide us want us to believe that we cannot win. we cannot accept that. we have to have the hope that she has, the hope that you have for being here today. this nation is at a crossroads. there are two profoundly different visions before us, two radically different dreams for
what is america. one vision takes us down a dark path, a division by race, division by religion, division by nationality, division by gender, division by age. the voices of division exploit people's fear by labeling and trying to pit one person against another, by singling out other, either women or latinos or african-americans or moslems or immigrant or gays were seniors. we do not believe that. we believe in the all of humanity. the voices of division obstruct government efforts to give financial support to the unemployed and the sick. the voices of division obstruct government efforts to fully fund quality education. they seek to dammar children into poverty because they do not have an education. the voices of division have struck a reference to hold
people on wall street accountable. they obstruct efforts to protect retirees' standard of living. they tried to obstruct social millions outkithat keeps of poverty. but being here today and put this on a path of -- but being here today puts us on a path of common humanity. >> if you believe that it is the role of a democratic government to provide a safety net for people who are suffering, say "i believe." >> i believe. >if you believe the needs of people should come before the profits of corporations, say "i believe." >> i believe.
>> if you believe that all workers around the world should have the right to organize unions, say "i believe." >> i believe. >> if you believe that all people are entitled to decent living conditions, full health care, and quality education, say "i believe." >> i believe. >> if you believe that party and environmental destruction must end, say "i believe." >> i believe. if you believe we should stop funding wars in iraq and afghanistan and instead fund our schools, fund the rebuilding of our infrastructure, fund programs for education and jobs for our veterans, fund investments in green technology and green jobs, say "i believe." >> i believe. if you believe that war is not the solution to the world's
problems, say "i believe." >> i believe. in a commoneve humanity that embraces people of all religions, all nationalities, all ethnicities, say "i believe." >> i believe. two years ago, on these steps, we were energized by hope. president barack obama said we are the change we have been waiting for. he did not say he was the change we had been waiting for. he said "we" are the change. if you believe we are the change, say "i believe." >> i believe. >both madonna and dr. rev. martin luther king said we need to be the change we want to see in the world. will you commit? please say i do. >> i do.
>> thank you very much. [applause] >> good afternoon. i am delighted to be here with george. the grandson of a virginia sharecropper, george and his -- spent his early childhood in segregated schools in virginia. when he moved to new york city, his first job was in the housekeeping department at presbyterian hospital in northern manhattan where he became a delegate and union activist at 1199 sci you.
he soon became a radiology clark and later -- radiology and later became an mri technologists. he has held every position in the union. today, he is the president of sceiu.ay yeasci >> liz allen is the chair of d.c. vote and is committed to this mission and comes from a family that has championed civil rights by sitting in at lunch counters in north carolina, refusing to prosecute civil
rights demonstrators in north carolina, and suing the building of a by a lab in boston. biolab in boston.n >> are you year to put america back to work? are you here for justice? welcome to our nation's capital where -- as americans, when we pledge allegiance to the united states, we pledged support for one nation under god indivisible with liberty and justice for all. but here in washington, d.c., we enjoy neither full liberty nor full justice. d.c. residents pay more taxes per capita than any other resident of any other state. but we do not have voting representation in congress.
we also do not have full control over our local affairs. that means washingtonians do not have a vote on whether to create green jobs, high tech jobs, construction jobs, or any other jobs. washingtonians do not have a vote on education or affordable housing. over the years, i have lived in north carolina, virginia, new york, massachusetts. in each instance, i was guaranteed voting representation in congress. by local representatives controlled local affairs. when i crossed the border into the district of columbia to set up residence, those rights disappeared. that is not right. it is not right that geography within the united states of america determines whether i have a voice in congress.
last i checked, this land was part of the united states of america. as a nation, we must stop allowing d.c. residents to be treated as second-class citizens, a group of people who are separate and unequal. now it is time for us to bring d.c. residents into our democracy. now it is time to make liberty and justice a reality for our fellow americans living in our nation's capital. if you have a sign that says "i demanded democracy," hold it high. hold any symbol of your struggle high and say "we demanded jobs." -- "we demand jobs, we demand justice, and we demand full democracy for d.c.."
thank you. let's get out there and do together as one nation. >> good afternoon, sisters and brothers. i want to thank you first for getting on those buses, for making the long trip, to make sure that the voice of working people in this country is really earned. we are here because we are tired of being represented by the voices of the so-called tea party. we are the real america. we are one nation. we are working together. we represent the best that this country has and we are here to say, today, that we are going to take back this country for working people. that is only the beginning. that is not the end. thank you, sisters. let's make sure that it
translates into a change in politics in this country back for working people in this country. [applause] we want to a knowledge of the president of the national council of la raza and some of our speakers. in the interest of time, we want to welcome from plainfield, new jersey, members of the rock and roll hall of fame, here to perform one of the most important songs in history. george clinton and -- >> america, is is one nation? ♪
initiative for a clean energy agenda to create jobs and strengthen the economy. then senate republican leader mitch mcconnell gives his party's address and discusses extending the tax cuts passed under the bush administration that are due to expire at the end of the year. >> over the past 20 months, we have been fighting to create more jobs today and to rebuild our economy on a stronger foundation. our future as a nation depends on making sure that the jobs and industry of the 21st century take root here in america. there is perhaps no industry with more potential to create jobs now. -- cray jobs now than green energy. -- to create jobs now than green energy. year after year, our dependence
on foreign oil grew and families were held hostage by gas prices. good american jobs have been sent overseas. we have seen new technology and jobs made not in america, but in places like india and germany. it is important we finally tackle this challenge. that is why, since we took office, my administration has made an attorney commitment to invest in green technology. they will be jobs for contractors to install energy- saving windows, for factory workers to install high-tech batteries for electric cars, jobs for engineers and construction crews to construct wind farms and solar plants that will double the renewable energy we can create in this country. i want to share with you one new development made possible by
clean energy incentives that we have launched. this month, in the mojave desert, a company called right source plans to break ground on a revolutionary new type of power plant. it will put one dozen people to work, building a state-of-the- art facility. when it is -- 1000 people to work, building a state of the art facility. when it is done, it will light 30,000 homes. with projects like this one and others across this country, we are staking a claim to continued leadership in the new global economy. we are putting americans to work producing clean, home-grown american energy to lower our reliance on foreign oil and protect our planet for future generations. there are some in washington who want to shut them down. in the pledge their recently released, the republican leadership is promising to scrap
all the incentives for energy projects, including those under way. even with all the jobs and potential that they hold. this does not make sense for our economy. it does not make sense for americans who are looking for jobs. and it does not make sense for our future. to go backwards and scrap these plans means handing the competitive edge to china and other nations. it means we will grow even more dependent on foreign soil. at a time of economic hardship, it means forgoing jobs we desperately need. in fact, shutting down just this one project would cost about 1000 jobs. that is what is at stake in this debate. we can go back to the failed energy policies that profited the oil companies and weakened our country. we can go back to the days when promising industries got set up overseas. or we can go after new jobs in growing energies. we can spur innovation. we know the choice that is right for america.
we need to do what we have always done, put our ingenuity and can-do spirit to work to fight for a brighter future. thank you. >> good morning. this is senate republican leader mitch mcconnell of kentucky. over the past 19 months, we have witnessed something truly remarkable in washington. we have seen a governing party basically to now the american people who elected them and aggressively advance an agenda that most americans vehemently oppose. in fact, the more americans spoke out against government takeovers, government-run health care, and wishful spending and debt, the more lawmakers seemed to begin. this is a pretty risky approach in a nation where the government derives its powers from the consent of the governed. it is also the main reason most people expect republicans to do pretty well in the upcoming november elections. but republicans are not under any illusions. we know voters are primarily
interested in stopping the government freight train and sending a message to both parties as november. they want all of us to know that we work for them, not the other way around. they want us to do something about jobs. chronic unemployment is not a second tier issue. it is a national crisis. at the moment, nearly 15 million americans are currently looking for work and cannot find it. another 11 million are working below their skill levels. yet virtually every single piece of major legislation democrat leaders in washington have proposed over the past 19 months has made it even harder for businesses to hire new workers or retain the workers they already have. and now they want to make it even worse. earlier this week, democrat leaders who spent the past year and half working tirelessly to expand the reach of government
left town without doing the single most important thing they could have done for drops. -- for jobs. too preoccupied, they neglected to pass or even propose legislation that would prevent one of the largest tax hikes in history. as a result, at the stroke of midnight on december 31, every american who pays income taxes thatt to get a tax bithike democrats have had two years to prevent. there will be a 50% increase on their first $8,000 of income. middle-class americans will get hit hard at the worst possible time. parents will see the child tax credit they have enjoyed for nearly a decade cut in half. many young people with college degrees will see the deduction they get on their loan interest vanish.
the death tax will rocket from 0% to 55%. many americans will soon have to hand over more than half of everything they have to the federal government before leaving it to their families. hundreds of thousands of small businesses will get socked with a job-killing tax hike. and young couples will be penalized even more than they already are just for getting married. all of these changes would overturn provisions that have been along of the land for nearly 10 years. allowing them to happen at a time when so many are struggling makes no sense at all if you want to help the economy. something even the president admitted in the past. that is place, s.3773, the tax hike prevention act. unfortunately, democrats
weren't interested. in the final days of the session, they had other priorities. and whenever they were asked about this looming tax hike, they just blamed the republicans. they said that republicans will be to blame for some people getting a tax hike because we didn't think anyone should get a tax hike now, i don't get it either. the fact is, the best way to help individuals and small businesses and the economy is to their taxes won't be going up at washington appear to have other plans with your money. as the president recently said, and i'm quoting him directly: 'i've got a whole bunch of better ways to spend that money.' so after maxing out the national credit card on a failed stimulus bill and a government- run health care bill, they want even more. and that's why they are now holding middle class americans hostage in a pursuit
of their foolish desire to tax america's new job creators in the middle of a recession. listening to. >> i am mcconnell. thanks for tuning in. >> still to come, nebraska democratic senator ben nelson talks about why he is against letting any of the bush era tax cuts expire. later, members of the house armed services committee expressed frustration with pentagon officials for not being forthcoming with information about proposed budget initiatives. and then, talk top financial regulators work closely with each other to promote the new financial regulations law. >> sunday, the second debate between senator bob for boxer and republican candidate carli purina. they talk about a range of issues including health care and
cutting federal spending. senator boxer participated here in washington while miss was in pasadena. see id sunday at noon eastern here on c-span. >> good morning everybody and welcome to the least suspenseful announcement of all times. [applause] [laughter] as almost all of you have reported, my chief of staff, rham emanuel has informed me that he will be leaving his post today explore other avenues 3 >> rham emanuel kids back to chicago. he has appeared on c-span more than 400 t. -- 400 times. it is washington, your way.
>> washington had one of the most difficult mothers of all times. she was a very crusty, domineering woman who you would think would be the mother of the father of our country. we really do not have any. >> sunday, the first of two programs with author ron chernow. it is the first launch scale -- largescale biography of our first president. >> earlier this week, nebraska democratic senator ben nelson spoke out against letting any of the bush era tax cuts expire. following the remarks, there is a question and answer time.
this is about 1.5 hours. >> good morning, and welcome to the heritage foundation. it is my privilege to welcome you to our auditorium. we welcome those who join us on our heritage.org website and some that are viewing this 3 facebook. we remind our internet viewers that questions can be submitted to not a program by simply e- mail us at email@example.com. we will be glad to submit those to the questioners following remarks today. please make that last kurdish to check that cell phones have beed off.
>> he oversees the statistics on crime and other important issues. he has served in state government as well as other think tanks here in washington d.c. area. please join me in welcoming bill beach. [applause] >> thank you, very much, john. we are going to have a wonderful program this morning. the title of the program is pro- growth tax policy for all americans: why we should not raise taxes in this economy. we have a two-part program. we will have a wonderful speaker in the first part of this program and then immediately following those remarks and questions that will follow those remarks, we will have an interesting panel that will go through many aspects of the current tax debate. i am really pleased that senator ben nelson is joining us this
morning to talk about the tax situation that we are facing. i am sure that everyone in this room knows senator nelson, but i would like to give a formal introduction to fill in the gaps that you may have in your knowledge for it everyone knows that he is from nebraska and has been the governor for two terms and we were speaking of his governorship just prior to this lecture. in 2000, he was elected to represent nebraska in the u.s. senate, filling the vacancy following the resignation of senator bob kerrey. since arriving in the senate in 2001, the nebraska democrat has played a key role in passing major tax reductions including the 2001 and 2003 tax cuts which is the subject matter of today's entire meeting. this month, nelson announced that he would support continuing current tax rates -- tax cuts for taxpayers.
he was a member of the game 14, which consisted of seven democrats and seven republicans to handle judicial nominations. he is a bipartisan player in 2008. he joined a bipartisan group to overcome a deadlock on energy legislation. senator nelson sits on the agriculture and nutrition committee, the appropriations committee, the administration committee and the armed services committee and that means he is a very busy person. we are doubly grateful that he is here today. immediately following his remarks, we will take remarks bausch take questions. at this point, please welcome senator ben nelson. [applause] good morning, everyone. thank you for that kind introduction and thank you all
-- before i began, i should tell you the story about right after i was elected governor, going out to the middle part of the state to speak at a their graduation. i spoke at their graduation and then i signed a few autographs afterwards. the staffer that was with me on the way back to lincoln told me this story. he said that he asked one of the young graduates what he thought of the governor and then he told me what he said. the little guy thought for awhile and then said that his dad did not think he was very bright, but he liked him a lot. [laughter] i thought that it dimwitted parents could have broken children, there is hope for us. automatically go into effect if congress doesn't act by the
end of the year. you know, two great philosophers come to mind. it was ben franklin who said: nothing can be said to be certain, except death and taxes. and it was will rogers who amended that by saying: the only difference between death and taxes is that death doesn't get worse every time congress meets. for many people, i think that issadly true. today, i'd also like to hear from you, hear your thoughts about what congress should do to promote a positive climate for economic recovery and job growth. first, where is our economy now? clearly, it's in better shape than it was two years ago. in the fall of 2008 we seemed to be on the edge of the cliff and about to plunge into a major economic collapse. in a few short months a financial disease spread and ruined retirements, drove
thousands of people out of their homes, destroyed their small businesses, threw more than 5 million americans out of their jobs and triggered a global economic crisis. in my state, which suffered less than most states, hundreds of nebraskans lost jobs, layoffs piled up and main streetwe're in better shape, but not in good shape. unemployment is close to 10 percent, existing and new home sales remain sluggish and economic growth is slow. many americans are frustrated by the lack of jobs. this week, the conference board's monthly survey showed consumer confidence fell more than expected in september. yet things could be worse. had it not been for president bush's intervention through tarp to stabilize our financial sector and president obama's injection of roughly $800 billion into the economy to save and create jobs, we could be in another great depression, which would be far worse than
the painful recession we're struggling to climb out of now. a recent study by economists alan blinder and mark zandi contends that without those actions, gdp in 2010 would be about 11.5% lower, and another 8half million more americans would be out of a job. and the nation would now be experiencing deflation that could have spiraled down to a depression. of course, making a case that things would have been worse can't be proven. and some people would dispute that government action can make things better in almost any case. so, what can we do now that's real and realistic to get our economy growing stronger and creating more jobs? congress has enacted several bills to promote job growth,
with mixed reviews from members on one side of the aisle or the other, and with too little bipartisanship. there is going to be one big opportunity for a bipartisan pro-growth bill in the near future. so far, though, both sides have been dug in, firing volleys of partisan talking points at each other, going nowhere. as you all know, a series of tax cuts enacted during the bush administration are set to expire at the end of the year. i played a key role in both the 2001 and 2003 tax cuts as one of very few democrats who both negotiated and voted for them. in 2001, we had a budget surplus, so it made sense let americans keep more of their money and not continue shipping it off to washington. keeping money in taxpayer hands also made sense in 2003.
today, in my view, raising anyone's taxes-given our fragile economy-would be a move in the wrong direction. nebraskans i represent tell me that they feel a lot of uncertainty about the future. nebraska business owners do, too. the possibility of tax increases is one reason that companies at home and across our country are holding onto cash, and are hesitant to invest in new equipment, new production and new employees. i favor extending all of the expiring tax cuts for a period of time, at least until the economy shows stronger signs of recovery. in my state of nebraska, the average middle income family would pay $5,090 in federal income tax if the tax cuts expire, according to the tax foundation. if tax cuts are extended that family would pay $3,461 in income tax, for a savings of
$1,629. there are many ways a family could use that money. there also are various ways we could extend the tax cuts. unfortunately, there won't be any action until after the november 2 elections. these tax cuts encourage work, saving, and investing. they help families raise children. they address inequalities affecting married taxpayers, and those affected by the amt. they encourage small businesses to expand, hire workers and create products consumers demand. just as i worked with president bush on the 2001 and 2003 tax cuts, i've worked with president obama on another set of tax cuts that often are overlooked. the recovery act of 2009 is often maligned as excessive government spending. how many here know that a full one-third of the recovery bill,
nearly 300 billion dollars, provided tax relief for millions of families, businesses and homebuyers? it's interesting that when one side of the political aisle supplies tax cuts they tout them as reducing the burden on taxpayers. but when the other side of the political aisle supplies tax cuts...they're labeled as deficit spending. so think about that. to me, a tax cut is a tax cut. they save people money they use to promote economic activity, from the ground up. the bush tax cuts and the obama tax cuts are both...tax cuts. here are a couple examples of how recovery act tax cuts are doing that in my state: the making work pay tax cut enabled nebraskans to save $9 million each week in 2009. that totaled a savings of more
than $346 million last year, and millions more this year. also, recently, a nebraska newspaper reported that nebraska ranked 4th among the states for seeking tax credit dollars under the first time homebuyer tax credit. this credit saved nebraskans $155.8 million between january 2009 and may 22, 2010, and millions more since, savings that helped people buy homes. with these savings nebraskans have invested money back into our state's economy and likely contributed to keeping our state unemployment quite low. my bottom line is this: government should keep taxes as low as possible. now, extending all of the expiring tax cuts for awhile would, i acknowledge, raise the
just like the recovery act package in 2009, it is imperative that we take actions to help the economy. i hate deficit spending, but some matters are so urgent that they can't wait. such was the case with the recovery act and tarp, and i believe the same holds true about the tax cuts. our economy hasn't yet bounced back and raising taxes on nebraskans to fund washington spending surely won't speed recovery. in fact, it could do just the opposite, leading us to the wilderness of a double dip recession. this brings me to another point: raising taxes would reward washington for years of fiscally unhealthy actions that haven't gotten spending under control. it'd bit like handing a big chocolate cake to someone who for years has overeaten. let's look at the facts. since at least 1990, federal
spending has increased every year except one -- 1993. in 1990, federal spending totaled about $2 trillion. this year, it's about $3.6 trillion. in my view, members of congress should begin to work together - democrats, republicans and independents-and find ways to bridge the partisan divide that seems so wide today. we can start with a goal of holding the line or even reducing government spending. it's the right thing to do. in the senate, i sit on the appropriations committee and for the last two years i've been chairman of the legislative branch subcommittee. we held down spending last year and this year we're going further and holding spending flat. our committee.
by holding the line on spending in the legislative branch bill we're setting an example to all federal agencies. nebraskans, and many americans, would welcome seeing congress work together on spending restraint. we need that now more than ever to start bringing down the soaring federal deficit. like federal spending, the deficit has been on a steady upward trajectory. it now stands at more than $1.4 trillion for the second year in a row. worse, the federal debt stands at more than $13 trillion. that's unsustainable and a dangerous drag on our economic future. it's more than that; it's a threat to our liberty.
not long ago, joint chiefs of staff chairman admiral mike mullen declared that the top threat to america's national security isn't north korea, iran or terrorism. he said, the most significant defense. it is estimated that by 2012, american taxpayers will pay $600 billion-just in interest payments on the debt. that's about what we spend annually on defense. so, admiral mullen makes a convincing point and everyone in that threat. each of these issues --tax cuts, government spending and the debt-are tied together and will have a impact on our economic future. i'd like to offer one final point. this week, i've written to president obama and encouraged him to call on congressional leaders and others to join him in a bipartisan, bicameral summit right after the
elections to find ways to work cooperatively on spending cuts, taxes and deficit reduction. i suggested holding a private discussion, free of posturing and playing to the cameras, perhaps at camp david. if that setting could lead to the camp david accords, why not the camp david agreements? such a discussion about how to collaborate rather than compete with each other could foster an open exchange of ideas on fiscal issues in advance of the bipartisan fiscal commission report expected in december. regardless of the outcome of the november 2 elections this discussion must occur. it must occur to break down barriers that currently are stifling any attempt to address spending, taxes and deficit reduction, and many other fundamental and serious challenges that confront america. for the good of the nation we love and the freedoms we all
cherish, i hope this camp david fiscal summit comes to pass, and can be a start for a new way of getting things done for the american people. thank you again for inviting me here today. [applause] gibb we're going to take some questions with your permission. we have several sources of questions. your the first source. if you do not ask the first question, i have one. we have a lot of people watching on the internet. who would like to ask the center to the first question? remember, the press has a question and we could go with them. i have an awful hard question. you were born to get an easy question. -- you were going to get an easy
question. if congress extends the 2001 and 2003 tax relief, do you think that they will take that opportunity to launch into fundamental tax reform? >> it depends on one person's tax reform idea is another person's tax reform nightmare. we need to address tax reform to promote longer term investments. a long-term investment is for 12 months. it is certainly not what we want as to what we have right now. if we do that, we need to address the whole question of what the capital gains rate is, whether it started at the present level, slightly higher
and begin to scale down over a period of time. i think we need to address that. we need to ask the question "what can we do to stimulate the economy?" will they balance out? will we end up with more people working? will we be able to get out of the economic slump faster if we make that kind of adjustment? >> we need to have open minds about how we go about doing this. at the present time, no matter what we have done to date, it depends on who you ask, whether we are out of the debt -- the recession or if you're about to get out of it. if we do not find a way to get more economic growth, we will not get job growth. we are not hiring more people and you either move forward or
backwards. stagnation will result and production -- and a reduction in effectiveness throughout the country. >> we have microphones. when i point to someone, if you would wait for the microphone. we -- identify yourself. >> former congressman here. u.s. speak of bipartisanship and you mentioned the mutual problems that each party has. can you share your thoughts on what you think are the specific arguments that you think republicans need to get over and the specific arguments that you believe democrats need to drop them get over? >> first of all, i believe that the willingness to come across the aisle has to be there before we even talk about the
arguments. if there is not a willingness to do it, there won't be any dropping of the arguments. it seems to me that when we put together the gain of 14 -- de gang of 14, we needed to get an up or down vote. that is what we agreed on. but it was isolated very carefully to be limited to that because we knew that we could agree of there. we would not necessarily agree on any of the candidates or nominees, but we knew that we could do that. we have the willingness to come together to sit in several different negotiating sessions without staff and talk through these things with one another. i do not know that there are certain arguments right now that each side is making that could
be dropped until there is a willingness to come together. that willingness could be harder from the standpoint right now from both sides, but particularly from my friends on the other side of the aisle who are up in 2012 and 2014. we either have now a key party opponent for we are about to get a key party opponent if they cavort with the democrat. you had senator bennett attacked in part because he co-sponsored a bill of health care with senator ron white and a democrat from oregon. you go down the list of people that did not fare well in the primaries, whether it is delaware or elsewhere, it seems to be people that could find ways to reach an accord.
the first step is to find a way to take that risk. there is always a critical risk associated with trying to work with somebody else. i do not worry about the arguments. without the willingness, nothing will happen. >> senator, thanks for doing this. david pope, there is a lot of talk about there will be votes to repeal obama -- care. -- obama -- care. -- obama-care. i do not support a -- repeal of the bill. what was finally enacted was
totally different than the house version and modified to make certain that there was not a public auction, which was the forerunner to a single payer. while the bill is not perfect, there are one to be adjustments made to it. one area that i hope that we can focus on is how we can find more ways to reduce the growing of health care. doing nothing is not an option. repealing the health care bill without another option i think is a cruel hoax to the american people who are looking at seeing the cost of health care probably doubling in seven years or less.
in the absence of a full-fledged worked out alternative, i cannot see repealing what we currently have. adjusting, making improvements, absolutely. but not a full repeal. >> >> there is a question in the front. please say who you are. >> thank you, i am with the heritage foundation. how do you balance u.s. fed policy with u.s. fiscal policy? the fed has suggested a series of asset purchases in the future to receive more capital into the economy. i am curious to hear your opinion regarding the fed printing money. it is -- is putting the dollar at global risk? >> my answer to that is that i have resisted any temptation to
try and politicize the fed in terms of getting -- giving congress more control over its four congressional review on its decisions. i think it is important. i have to say that i am concerned about policies that they have undertaken, but i am also aware that there is a broader approach to look at. i am more concerned about the one in china -- the yuan in china. we tend to worry about exporting jobs or losing jobs, which is the same. import products from a country that is underpriced by comparison because the cost structure is so much lower, and their currency is out of white
compared to the u.s. dollar. i would like to have less focus more on getting that under control than to worry about the fed. i am in favor of having an off it of the fed, but i think that the audit -- many who call for an audit criticized the practices which would only pull this was the fed. cost that would only politicize -- that will only publicize the fed. if it is big enough, then it gets more attention. >> if you were doing the agenda for the lame duck session, what would you put them on? say you're the king of the lame- duck session.
[laughter] either i was in charge for the made me think i was. i think that what i would do is focus on how we get the tax cuts done. we need certainty, clarity in this economy. we need to get that done. i would like to get us away from the practice of just kicking the can down the road to another time for another six months. unfortunately, in terms of the tax cuts and the deficit, we probably do not have the freedom and flexibility to extend them permanently, what ever permanent means and washington d.c.. it is until the next congress decides to do something. i think that kicking the can down the road is not helping us give clarity and certainty for business and for people. i was talking to a position the
other day in terms of the medicare reimbursement rate. he asked what would happen. i said that my experience is that we just kicked the can down the road. we do not go back and make fundamental changes to find a better way to compensate for care, so we just keep doing this and ticket down the road. >> he said that next time it comes to kicking the can down the road, remember, i am the can. >> that is wonderful. we have time for two more questions. there is one there in the corner. >> hi, laura truman with the heritage foundation. i want to ask you about the estate tax to it that is one of the taxes that is set to go to 55%. in your state in particular, it has a particular resonance for your constituents. >> that is one of the things
that has to be done in the lame- duck perik. i hope that this is not become a dead duck or a daffy duck. it should be sufficient so that it is not just until after the first of the year. it needs to be longer than that. the estate tax does have to be fixed. it is hard to predict what would happen, but i can say that somewhere between what the house has done and what the senate is set to do, 5 million per spouse exemption and dropping the top rate down from third -- 45% to 35%.
the inconvenient truth about that is that it adds to the deficit. this is a matter of fairness. and i think there is a certainty for tax planning and estate planning. i think there have been three bills that have died this year without a tax. -- 3 billionaires' that have died this year without a tax. they did not choose this year. that was just a joke. people were passing around a few years ago. this is when you have to do it. we do need to get that done, as well. those will be on the agenda to get that taken care of. >> to you have time for one more question? >> sure. >> i would like to recognize
j.d. foster who will be moderating our panel. >> senator, i appreciate your remarks this morning. the 2001 -- 2003 tax relief and their expiration is not a surprise. we have known about this for 10 years. it is not a surprise to this congress. they have been in session since 2009 and now through 2010, the finance committee has done no legislation on it. the house has done nothing. it appears likely to not do anything before the election. that being the case, what set of circumstances and the thought processes might you be able to offer for us to understand how, in the lame-duck, this bill that has been ignored this war might actually get addressed so that
the lame-duck does not become a dead duck? >> [laughter] >> the answer that i would give would be unfortunately congress has become crisis driven to it until there is a crisis, you cannot get the parties to talk to one another civilly, let alone usually to come up with solutions. that is the challenge that is there. it is like a professional basketball game. most of it is played in the last two minutes. that is when it is in earnest. this, to me is the equivalent of that. we have been back and forth and back and forth and now the deadline will drive the decision. i used to respect the fact that the bush should administration always got its supplemental
through right before a break for congress. when the members of congress were smelling jet fuel, they knew that they could get something done at that time that they could not get done before. if nothing is absolutely new, is perhaps new on this issue. yes, we have known people -- known. people have been talking about it. the lame duck would be the last two minutes to get something done. thank you, everybody occured i appreciate it. [applause] >> we really do appreciate the senator's time. what we will do next is essentially reveal, for the first on, some really interesting and dramatic numbers on what it would mean for the economy and for small business if the tax relief for 2001 and 2003 were not extended. i would like to call j.d. foster
and the rest of the panel, including me up to the podium. >> i think we can all draw some encouragement from the senator's remarks. i think he was very clear that raising the taxes in this economic environment would be a move in the wrong direction. largely, not just because of the expansion of government because of the extra uncertainty. essentially, there is no economic theory that says you raise taxes when the economy is extremely weak. there is nothing even marxist foolishness that tells you to do that. the american people know that. they don't have to have an economic decree to know. to do so would be a large increase of uncertainty in the economy and that would weaken
matters. we will discuss these issues a little further with this panel. i am j.d. foster and i am the economic fellow at the heritage foundation. i am going to be moderating and then mostly getting out of the way. i want to introduce our three panelists real quickly so that they can,. first was bill beach who we keep fully occupied at all of our events. we appreciate his participation. next to bill is brian reardon. for those of you who don't know, he is a form of small business. before joining the association, he was assistant to the president for economic affairs in the white house and we have been crossing paths for 20 years. next to bryant is scott hodge. he is now the president of the
tax foundation. he served as the lead of citizens. it is good to be on a panel of bright people in good friends. -- and good friends. >> in mid -- in his advocacy, president obama has characterized his plan as affecting only the top 3% of the population. recently, but actually exclamation, he has said that the other 97% will not be affected. your taxes will not go up. this is an intriguing proposition. it basically says that you can increase taxes on the owners of most, and on some of the labor,
and have no economic effect on anybody else. i doubt that that is actually the belief of the white house. it is filled with very bright economists. but it is the characterization that most people in this country, taxpayers and voters alike, have of this plan. i want to describe a publication that came out that challenges that proposition by doing an economic analysis of the president's tax plan. for those of you that have been asleep for two years, i will go to the tax plan very briefly. president obama has asserted that we can successfully raise taxes on people with incomes above 200,000. if they are married, about 250,000 and go back to the rates that prevailed prior to the 2001 tax act. he also said that he will raise the taxes modestly on capital
gains and we believe he will accept the position of the house leadership that the dividend tax rate will rise to the ordinary income tax rate. if you are unfortunate enough to pay a 39.6 on ordinary income tax rate, you will see that tax rate under dividend income as well. to assess whether or not this will have any impact on anybody else except for a couple million people, wheat and a host of other people throughout this building put the president's plan into a model of the u.s. economy. here is a little bit of inside baseball. this is the global insight model. for those of you who really are nerdy this morning, that is maybe the top model of the economy that everybody uses. everybody including the white house. they have the same model that we
have. the treasury has it. the labor department's, the energy department, fortune 500 companies. so, what does it mean to put something into a model? let's suppose that you have a really great car. it is not my car. i have a government motors car. [laughter] it is a really great car and you fill up with gasoline and you drive that car as fast as you can until it stops because it is out of gasoline. you get out of the car and draw a chalk line on the highway and we all look back to the starting line and fill up with greedy , drop -- the same cart dried it till it is empty and then draw a chalk line on the highway. what we are interested in is
not held for each car went, is the difference between the chalk lines. which is the superior grade of gasoline? which did better or which did worse? we first put into an extension of all of the tax cuts by bush. i like to call them the tax cuts of 2001 and 2003. we put that isn't an ran the model out and that is what is called the baseline. we put in everything that congress wants to spend. everything. then we made one big change. we put president obama's tax plan in place of extending all the tax cuts. his tax plan affects everybody in the country. we get much slower economic growth. at a time where we are trying to have a stronger economy, having
a slower growth is not the way to go. if the big dashboard indicator shows your speedometer, if your my nephew, the first thing that you see as the radio. -- is the radio. we have 1.1 trillion dollars smaller than it would be if we extended all of the bush tax cuts. the most amazing thing besides the $1.10 trillion dollars tax cut is the jobs that we have. the first year of our simulation, and we did this for 10 years, there are 238,000 jobs that should be there that are not there. you say that that is not a very big number. we are just getting started.
by 2016, jobs that should be in the economy that were in the economy are not there. if you are looking for a job, the last thing you want is to see a forecast of the economy or the unemployment rate for every quarter of every year is hire that it should be. there are more unemployed americans. if you are looking for work now -- is not agree economy to be in. investment is down by $33 billion across the entire time. because you drop investments, you do not have an expansion of factories, starting up of new businesses. if you do not achieve your potential, you do not produce the jobs or the output. does this have any affect at all on small business?
this is a tax change that affects the 1040. that is for those of you that have never filed taxes, that is your income tax form. you will learn to love it and hate it. there are 26 million businesses in that tax form. in every case, whether you are losing money in your business or gaining money in your business because you are filing for your tax form where you have other income, your taxes go up. for all of these businesses, the average tax increase is $3,570. you could have a tax increase of 41,003 under $63. this affects people at all ages. particularly, i want to point out that if you have dividend income and you are retired and
you have a taxable return, you may not be at $200,000 or two under to thousand dollars. you'll pay higher taxes. the bottom line of our paper says -- which can get a copy out of the table, and we have done these results for every state in the country for every congressional district. any amount of information you want, we can give it to you. the basic message is this. at the top, in revenues, we are feeling tremendous pain down the income scale. everybody will share some experience in this tax plan. as my final note, even president obama will feel the pain. he expects to get $770 billion over 10 years out of this plan. but when the economy, under his plan, performs so much less than it could, with less employment, less investment and so forth, he
gets less corporate tax revenue, less individual income tax revenue $170 billion less, the very revenue that is supposed to support social security and medicare. when you some of all of the shortfalls, he is getting about $26 billion a year instead of $77 billion a year. president obama maybe a courageous guy, it seems to me this is bordering on political -- i do not know what to call it. please look at this paper if you want to see the economic impact. i will be eager to answer your questions during q&a. thank you. [applause] >> i just want to stay down here that is okay. we have known each other for a long time. we started working together
about 23 years ago. j.t. was in charge of his tax policy and my official jobless to take out the trash. j.d. had been kind enough to be friendly to me. i am going to focus my comments on as corporations because that is who we represent. -- on s corporations. they are under the gun right now. one of my major points is to convey to you that that is not by accident. congress, over the last 50 years has fervently strengthened the rules for s corp. as. this is to make sure that private enterprise is a major part of the economy. they are everywhere. they are in every state in every community. they are in every industry. not many people know what an s corp. is.
not everybody loves escorts -- loves s corps. we were talking about the subject of escort -- s corps. they ask why we should keep them. i said that this was a different conversation every time you talked about the economy, you cannot get the president to not talk about and as court -- and s corp. they avoid the double layer of tax. you say that those are republican talking points. you need to hear something different. so, we went back in conjunction
with the 50 year anniversary of the s corporation. this applies to both parties and people all persuasions. they were great back then. there were created by a democratic congress that was concerned that economic power and decision making was being consolidated among to a few corporate boards and there were taking over a larger share of the american economy. it was signed into law by republican presidents, dwight eisenhower, who was being accused of practicing triple -- trickle-down economics. we were told at the time that congress created the s corp. c corporationm a s
so that you would not lose your home or cars. you also have to pay more tax. can anybody tell me what the top rate was back then? the top rates for individuals was 91%. did you worry family business and you made a dollar, you would not have but 4 cents on the dollar. the s corporation replaced that. people could insure that their business would survive. eliminated another tax. they have been phenomenally successful. when you combine them withllc's, there are bigger than c corporations. there are bigger than big business today. it contributes more to the
national income. that said, they're under attack. i am going to focus on three quick things and and turn it over to scott. the first is the rate debate. the rate debate is whether we should extend all the rates or just for those making less than two under thousand dollars a year. at the crux of that debate is the question of the impact of those higher rates on businesses where the income flows through the individual and they pay taxes on the business end of the individual level. they do not actually get that income. i can reinvest my income into the business. i still have to pay taxes on it on an individual level, even though i am keeping the money on the business level. that is something that people focus on. one side will say that a few percentage of folks are going to
be affected by. i think our side focused on the strong arguments which is that it is not the number of folks that are affected, but the economic activity that is being taxed. half of of all that is tax. half of that and come is tacked that the top two rates. one-quarter to one-third of all business income is going to be subject to a rate increase. a friend of mine indicated six months ago that he thought nancy pelosi had a secret plan to raise taxes on business and the secret was that she was going to do nothing. i thought it was funny at the time. congress is one to leave tomorrow, today may be true that not only have they not acted on this issue, but it is not
actually a surprise. we are now going into an election with congress not having acted on it, but they have not even introduced anything. there is not a plan out there. this is not want to extend the rates. in the great debate, it comes on top of something that already happened. part of the health care bill included a 3.8% medicare tax that applies to all investment income earned by folks in the united states of america. the only people that are protected our shareholders. i am not sure why they did that. what they did was immediately overturned that by trying to claim payroll taxes. that tax is called the medicare tax. it is not. it has nothing to do with medicare. it does not go to the medicare
trust fund. it was made to look like it was part of medicare. starting in 2013, you will have a 3.8% tax on all forms of investment income on top of whatever the rates in the being. so, the top folks, in 2013, it is going to be 25 to 30%. that is an excessively high rate and will have significant economic repercussions. that is the story. s corporations were something that congress created -- created and proactively strengthened to make the economy more diverse, to strengthen main street, to make sure that when we go through crises like we did the last couple of years that there will be something that helps us survive the crises. we saw that and lost a couple of years. it is unfortunate that the crisis itself is not
precipitating -- is itself for disobeying in the attack against -- is itself participating in an attack against s corporations. [applause] >> i will put this in a global context. i want to mention that brian, rather rudely, got to mention a very important study i published looking at the higher rates and flow through entities. thank you for allowing me to promote my own work shamelessly. [laughter] all kidding aside, we looked at the impact of allowing the top individual rates to rise to 39. 6% and the 33% to 35%.
with the that the impact using our individual tax model. -- we looked at the impact using our individual tax model. what we found is that the president's plan would raise a little over $600 billion over the next 10 years by raising the top rate on high-income individuals. about 40% of the new revenue that would be raised by allowing the top rates to expire would come from business income. this is perhaps one of the largest tax increases on american businesses that we have never seen before. it is being done under the guise of raising taxes on the rich. while the administration keeps repeating the phrase, this is only going to hit the top 3% of taxpayers, that is really not a meaningful statistic. cancer -- less than 0.5% of
americans are diagnosed with cancer every year and we did that pretty seriously -- take that pretty seriously. these statistics are important to mention. high-income individuals -- the majority of them have some form of business income and they earned the vast majority of all business income earned by individuals. those are the relevant statistics. let's move on the capital gains and dividends. it is a critical element of the economic picture. especially within the global context. that is one of the key features that is being missed in this debate -- the effect of these tax increases on american competitiveness. let's just, first of all, step back and remember the first law of economics and taxes. when you tax something, you get less of it. capital gains and dividends are investor-level taxes on
investments. why, at any time cou, we want fewer investors and less investment? we would not. but that is one of the consequences. i understand, as has been mentioned that capital gains and dividends are second-layer taxes. corporations paid a 35% tax at the federal level on their property -- their profits that they earn. profits are sent down to the shareholder level and those people pay taxes on that. we are talking about double taxation. the higher you raise the rate, the higher the level of the double tax on this income. we also need to understand the effect of different types of taxes on long-term economic growth. a very important study came out a couple of years ago looking be effected different types of taxes on long-term economic growth. what they found is that the
most harmful tax for long-term economic growth is the corporate income tax. the second most harmful tax on long-term economic growth is high personal, marginal tax rates. these most harmful taxes are followed by taxes on consumption, such as value added tax, sales tax, while the least harmful taxes for economic growth or taxes on property. why do we have this hierarchy of taxes? because capital gains income, corporate income -- they are almost mobile factors in the economy and thus the most sensitive to high tax rates, while property and consumption are the least mobile and therefore the least susceptible to high rates. with that, we ought to be very worried. the u.s. has one of the highest corporate tax rates in the industrialized world.
only japan has a higher or lower corporate tax rate. unbeknownst to many americans, the united states also has one of the most progressive income tax systems in the world. what we mean by that is that we rely more heavily on the top 10% of taxpayers than any other industrialized country. our poor people have the lowest tax burden of any industrialized country. what that tells me is these findings from the otc -- oedc, by raising these taxes, we will have very severe, long-term economic consequences. let's put our dividend tax rate in particular in in in a national perspective. the u.s. has the highest combined rate on dividends among the 30 largest industrialized co. -- countries at 3944%. denmark is over 56%. france is around 56%. the u.k. now has a top dividend
rate -- combined dividend rate of 54%. they just bomb dust from the third position here -- bombed -- the thirdfrom position here. the u.s. used to have the eight highest dividend rate. in the course of the last 10 years, after a series of tax cuts, our ranking has raised. why is that? it is because every of the country on earth has been cutting their corporate tax rate and cutting their investor- level tax rate. even while we have been trying to cut our dividend rates, we have been rising in the rankings because our corporate rate has stayed still and other countries have been making themselves more competitive. as brian mentioned, we also have to include here the 3.8% medicare tax. when we add up all these taxes
-- the medicare tax, the 39% top rate, the state rates, and the corporate rate cut -- if the bush tax cuts expire, the u.s. will have a dividend rate of nearly 68%. no other country on earth will have a combined rate on dividends even coming close to that. what that tells the rest of the world is that we're a very hostile place to do business. we're putting up an iron curtain -- attacks iron curtain on american investment -- a tax aaron curtain on american investment making it a hostile place to do business in and from. i do not think we want to send that signal to the rest of the world. let me finish up by saying we should not only the world -- worried about global competitiveness, but near to home. canada, to our north, is quickly making itself a very attractive place to do business in and from.
canada's corporate tax rate is a little over 29% -- a full 10 percentage points below our overall rate. the canadian government has a very public position that they are going to keep their corporate rate and the lowest of any of the g-seven industrialized countries. no matter how much we lower hours, they will lower there's even further. their capital gains rate is about 14.5%. the combined dividend rate is much lower than ours. it is simply a more attractive place to do business. we're want to continue to see american investment go north rather than stay here. i will just finish up and we can have some questions. there is a very rhetorical statement here here often from liberals and democrats -- a
statement that you hear often from liberals and democrats finding this as unearned income. this was part of the medicare debate. we will put this 320% tax on unearned income. jimmy, -- 3.2% tax on unearned income. to me, that is not true. there are three unearned types of income -- lottery winnings, inheritance, and congressional salaries and, if the tax cuts are allowed to expire. [laughter] >> i think you do not need to clarify your -- just congressional salaries. >> lottery winnings take some intelligence to pick up the numbers. >> something like that. it is interesting, in this debate, the president likes talking about tax cuts for the wealthy. if you listen to the language -- language is very important -- there are no tax cuts but we're talking about. it would be nice if we could talk about that, it would be
good for the economy, but it is not on the table. we have a budget deficit of $1.40 trillion and that makes this a dicey proposition. we're talking about tax increases. he is talking about raising taxes under his plan on people making over $250,000, many of whom are small businesses. that is the cornerstone of their business. even for everybody else, that makes you reasonably well off. it does not mickey the millionaires and billionaires that the president refers to -- make you the millionaires and billionaires that the president refers to. it is a great disconnect. it was apparent in majority leader for your -- steny hoyer's speech which shows he has a sense of humor. what we really need to do -- the best thing would be to extend the tax relief from 2001 and 2003 and make it permanent. short of that, at the least, we should do what we advocated early on in this debate --
extend them into the economy is strong enough to take a tax increase. we'll have to debate about tax cuts for the rest of our lives. we just do that in this country, during and europe. it is not the time to do it. i was particularly pleased to hear senator nelson remarks that he is exactly proposing that purity has it exactly right. we're going to have the debates. if we can make them permanent, fine. lesson is extend them until the economy is -- let's extend them until the economy improves. let's open it up to questions. as before, please see your name and affiliation when you start your question. -- state your name and affiliation when you start your question.
>> has congress been dally too long on the recovery? >> the lack of action by congress has already imported the economy. the sooner they take action and provide certainty, the sooner that folks can make decisions, knowing what the rules are going to be. we started keeping the list a few months ago of the things that congress and the government were doing that create uncertainty among businesses and families. it is in two categories -- one his acts of commission and the other is omission.
there are policies like the 1099 reporting requirements which is bringing everybody out. the changes to the health insurance rolls. then there is the act of omission -- the on shirty -- the uncertainty about the bush tax cuts. the r&d tax credit and the state sales tax deduction and all of these other policies -- and they are still trying to figure out what to do about them. policies on the table were is only extended for a year. even if they got it done today, they would have to come back to extend them for next year. it is a ridiculous lack of action and effectiveness. they are dragging the economy down. people do not know what to do. we have one of our advisers who does state tax planning. he has of $100 million estate -- a client with a $100 million
estate who passed away and they are sitting on the assets, waiting to see what to do. it is not helpful. a longer it goes on, the more harm it will cause. >> this may be the most anti in -- anti-business environment i have seen here. it is aimed at american business, more generally. this administration really has the sights set on american businesses. they have an obsolete notion of how american business does business in the global environment. this constant rhetoric about shipping jobs overseas is absolute nonsense. it is a red herring, but it plays well in the polls and in the public, because it feeds our natural in securities. i got outpost -- about impose looking at real numbers from the department of labour on mass job layoffs and where the jobs go. what is the source of those mass
layoffs? the majority are due to seasonal work or to the economic environment -- lack of demand. way down the list is what they call movement of jobs. jobs move from one location to another. when looked down into the bowels of those numbers, what we find is the vast majority of people who lost jobs because of their -- because their jobs moved was moved from one state to another. the fact is that there were three times as many jobs move from one state to another than were moved from the united states to overseas. in fact, the majority of those jobs that were shipped overseas were within the company, said they were just move from chicago to london. so, these are not really lost jobs, but moving within the company. it is a red herring being used to wage war against american business. they're trying to close down or
change international tax rules. raise taxes on american business is doing tax -- doing business abroad, which will affect their ability to compete in the global marketplace. this is a very anti-business environment and it is not a wonder that there is a reported $1 trillion of cash sitting there doing nothing. there is another $1 trillion in cash sitting of short and it will not come back to the united states to be invested. it is simply too punitive to do business here. >> any other questions? >> over here. loren truman with the heritage foundation. you have all done a very good job making the case about how the high rate of taxes drains the economy. earlier this year, when we all watched as the greek economy imploded, it put into mind how dangerous a huge deficit and
that is. what would you say -- and the debt is paid what would you say to people who do not like taxes but then we have this huge debt facing us and taxes are bad for the economy, but so is debt. we cannot just put this all on spending. i would just like your thoughts on that. but that there is another context. that is -- >> there is another context. there is what is happening yesterday in brussels. there is this process. some folks were driven by their unions. others were just worried about losing pension payments and benefits that they thought were going to be there. french workers are opposed to going to a 62-year retirement age after having the luxury of
one below 60. is not a taxeing policy problem. we're seeing structural deficits coming home to roost. on may 14 of this year, the international monetary fund -- not a group that normally gets praised -- wrote a letter saying to the united states treasurer, you need to get your structural deficit in line, because by 2015, your total public debt -- a government plus federal government -- will be at 100% or above your gdp. they are worried about political turmoil and other kinds of economic turmoil if it gets to that level. where i am going in is that we are on a very short path towards resolving the structural deficit. it probably will be a combination of spending and tax.
i would like to be tax reform so we have a more productive tax system that is fairer to the economy into the taxpayer. we will have to look at revenues and spending. spending is the big driver. that is really out of control. we are at 25% of gdp on total federal spending it just gets worse every year -- federal spending. it just gets worse every year. the majority of our work must be done on the spending side. it is ironic. what is happening over there is also an indictment for the value added tax which is being talked about as a solution for our fiscal problems. since there is no political will to cut spending and to take on the major entitlement programs, there is talk about having the value added tax to raise money painlessly to solve these problems. each and every one of the countries in europe that is going through this, down right now has a vat rate of over 20%.
how good is it doing now? their problem is their social contract -- the fact that you can retire at 50. when i was in berlin a couple of years ago, most workers had gone on strike because their retirement age was being moved from 51 to 52. my heart bleeds for them. they have a problem with the social contract. they have far too generous benefits and far too few people working. we're getting awfully damn close to that. half of all american households pay no income tax. as bill has documented painfully, we have a growing population of americans who are too dependent on the federal government. we all know we have a shrinking government -- shrinking population at the top who are paying the bills of their neighbors. it is financially unsustainable. it is fiscally unsustainable.
>> that was a really good point. >> s corp.'s are paying it all. >> this is a problem of spending. as bill indicated, since world war ii, federal spending has been around 20% of gdp -- one out of -- $1 on a $5. it is only going to get worse. clear still at a moment of crisis where we have to decide how big the federal government debts and how what we do about it. when we met with the gentleman a week ago about the tax rates necessary to fill the fiscal gap for medicare, medicaid, and social security, even if you did not produce the promised benefits, just raise the taxes -- it was a really nice looking chart. the guy said, i got it from you at the heritage. you just can have 80% rates and
expect to get the revenue. this is a problem of spending, not of raising taxes. my account is that -- in all my years working on the hill, i spent a lot of time trying to reduce spending. it is hard, much harder to reduce spending than it is to generically raise taxes by raising rates and adding onto our tax system. if the case -- the case needs to be made to focus on spending. that is what the problem is and that is where the solution will be. >> you could tax 100% of private debt burdens -- private-business income for the last year and it would fall about 40% short of covering the deficit this year. over $826 billion in taxable business income reported on tax returns last year. the deficit is $1.40 trillion. where are you going to find the
money. where are you won't find the money. we could crush american business and entrepreneurship and it still will not cover the amount of spending that is out there. >> i still know where the money is -- it is in the next generation. if we do not take positive steps, we will pass on to the people who are between the ages of 5 and 30 the crushing debt and their lives will be ruined. that is what we have basically done. i am a distinguished member of the boomer generation. there are a few of you out here. we have taken the strategy of love life and pass it on. instead of solving these unfunded liabilities and getting a system of public finance in place that will give a better lives to the next generation. we're finding the money, 30, 40, 50 years from now. that is where it is. >> let me tick the prerogative to ask a question of each of
you. simply, why? as you noted the administration has the same basic economic model that you have. they can see the devastation this would impose on the economy. they see the political peril they are in going into this election and can only begin to imagine what will happen when the economy gets weaker and taxpayers have to pay more taxes. it peaks in april, 2012, when people are finding it difficult to face the tax increases and have a big tax ship when they file their taxes. it is politically not a good time for surprise like that. that being said, economic effects to bad politics -- why are they doing this? >> the question. i am sure we have different opinions. i was asked that question several times recently ahead. students and business owners were asking me this. i got some very interesting
theories about what is going on. the truth that the matter is, i think, ultimately, we can reduce the number -- the machinations to the calculus that jim began in gordon developed so eloquently. we're dealing with politicians who want to have revenue to spend for vote purposes. it may sound crass, but if you are a business person, your bottom line is your profit. he will do whatever it takes to make a profit. if you are a politician, you will do what ever it takes to get reelected. there are times when that is going on in the politicians' head and there is a short circuit between that goal and logic. you can and do some of these things with revenue without destroying the very base that you are out there with. i think the president is kind of thinking about the words that mary summers whispered in his year -- a cautious where you tread.
we may be seeing more posturing than policy. where the convention that i have been disappointed that congress has not been more active on dealing with these issues. another disappointment has been watching the obama economic team. there is a point of example -- we used to work together to put out statements of administration policy when the house or senate move the bill. we would come up with a statement and say what we like dan did not like. house passed a health care bill, which was over 2000 pages and rewrote the rules for 1/6 of the economy. the statement was two paragraphs long and basically said, i really like this. when i got from that was the economic decisions being made at the white house for not being made by the economic team. these were not the ones in control. i think that should change because it would be better
policy. >> i think why is the main driver. the philosophy of redistribution -- the government is a tool to redistribute wealth and income from the top to the bottom. that is the only way that they see to he plugs -- you gloves who -- equalize incomes across the economy. we will bring down one group in ward -- in order to equalize incomes. we will not try to have policies to allow everyone to rise up. there is also a disconnect in their belief on the effects of taxes on people's behavior. on one hand, this is an a mensuration that pushed higher tobacco taxes to reduce smoking. they pushed and trade tax in order to reduce -- cap and trade
tax. the push for higher taxes on oil companies to reduce our reliance on oil. if they fail to understand that higher taxes will have an impact on people's incomes and their desire to work. that is a staggering level of disconnect. austin will be -- austan goolsbee has published a paper that shows that people did not really change their behavior when you change their taxes. they honestly believe that. until they understand that the same effect that happen with cigarettes and smoking happens with work and income, they will continue to push these wrongheaded policies. >> those were all good answers. let me offer one more as an epilogue. they have pushed spending up enormously. they need the money. [laughter] they can get it two ways --
allow tax increases to go into effect because the previous tax law expires, or they can extend and passed their own with their own brand. it is easier to just let the taxes jump because something expired than to have to do it themselves. they do need the money. we get the spending under control and we do not need the money. it is ultimately about the spending. thank you for coming. we will conclude our program with that. [laughter] >> feed the beast. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] here is our schedule -- members of the house armed services committee expressed frustration with pentagon officials for not
being forthcoming about proposed budget initiatives. after that, top financial regulators tell the senate banking committee they are working closely with each other to an element the new financial regulations long known as the dog frank -- dodd-frank act. later, the financial stability oversight council moves forward with a move that would restrict high-risk trading. sunday on "washington journal," deepak bhargava discusses the efforts being made to mobilize progressive voters in the midterm elections, then ed gillespie talks about his role in creating and raising money for organization giving money to congressional contests across the u.s., and after that, a johns hopkins professor will examine areas of liability in china's economy and have a good impact the world. plus, your e-mail and phone
calls. "washington journal," is live on sunday morning c-span. >> good morning and welcome to the least suspenseful announcement of all time. [laughter] as almost all of you have reported, my chief of staff, rahm emanuel, has informed me that he will be leaving his post today to explore other opportunities. >> with the president's announcement, rahm emanuel heads back to chicago. since 1992, he has appeared on c-span more than 400 times, just one of the almost 15,000 people you can search and watch for free anytime, online, at our seas and video library. it's washington your way. >> mr. cameron, you were an optimist ones. now all you offer is a miserable, pessimistic view
about what britain can achieve and you hide behind the deficit to justify it and we will not let you get away with it. >> newly-elected labour party leader ed miliband from his annual party conference -- that is the night and 9:00 p.m. on c- span. >> at this hearing of the house armed services committee, members question pentagon officials about proposed shifts in defense spending intended to cut overall costs. the proposal includes the elimination of the joint forces command in norfolk. this is 2.5 hours. general, thank you very much. i have spent a great deal of time and effort over a period of years. pursuing jointnes.
i was in on the ground floor, 1982. an effort begun by richard white of texas. my first bill abolished the joint chief's of staff and i found none of them had a sense of humor but the house passed on three different occasions, legislation to create jointn se s&p ess with barry gold water and the able stance assistance of bill nickels. it was called gold water, nickels that created in fact,
jointn ses. now it took some time for the joint culture to come about, but it did. services saluted and did well. and i to this day, wish to compliment all those present and past who helped create the jointness. my first question. joint forces command is a subject of elimination. if that comes to pass, who within the department will have that's it's central mission? the job advocate, develop and joint operating concepts.
doctrine and training. will we be throwing away all the efforts that began with gold water nickels, should that happen? i'm very concerned that or about where that will go, how much thought has gone into that and will our military be better off as a result? but answer the first question, secretary lynn, who assumed that duty? >> thank you mr. chairman, we too recognize the importance of jointness for the training, doctrine and in our operations and appreciate the role you played gold water, nickels and the subsequent events. as you indicated, those efforts
have been successful in changing the whole culture of the department. the operations are different than what they were during the first gulf war when jointness was not adequate. services are different than in the 70's and 80's and the actions that led to the gold water, nickels. legislation. we do think that since the department is in a different place, that is it possible to eliminate the joint forces command. to eliminate this four star billion dollar headquarters but retain the culture of jointness. you asked where the leadership will come from? the joint staff and now the services and the coalk o ms themselves because of the efforts of gold water, nickels and the joint forces command. the joint doctrine training and
operations are will -- continue to be a strong part of the department. >> where does it go again? >> as i said, the leadership in terms of training and doctrine, so much of it will come from the joint chief's and the joint staff, but the place that we're in is fundamentally different than the 70's through the 90's. we have a much stronger joint culture inside the military departments and services themselves and combatant commands that operate jointly and have an e those of how they operate.
>> thus far we have not received the information. mr. secretary, when will the information be forthcoming? >> mr. chairman, we provided i think briefings to the staff and - no, i'm not talking about briefings. i'm talking about information. pieces of paper. >> pieces of paper? we have provided extensive legal opinion top braecht legislation and will continue to answer the committees questions and provide documentation and material the committee needs as the task force moves into the implementation phase there will be much more material available for the committee. >> have you provided everything for which we have asked? >> i'm not sure the committee
would agree with that we've been trying to be responsive as possible and will continue to do so. if there's specific information we need, i'm happy to follow up for the record. >> for the record, i would like to receive the copy of the memorandum of the joints chief's of staff and proevaluation, joint command establishment working group. i would like to have a copy of that piece of information, please? mr. mckean? >> thank you, mr. chairman. as i eludeed the opening statement it's critical the department provide this committee with as much information as possible. where cuts will come from. where reinvestment will occur in impact of current and future operations. this is no more true than in the case of proposed closure of u.s. joint forces command.
the stand up for collie sure of a combatant command deserves scrutiny in the department and a dig significant change for the workforce. on august tenth during a brief together house staff and members by secretary hail and other senior leaders. several documents were requested regarding closure of jif con. by the end of the month no information. i want to be even more specific to ask for this. on august 31, i along with four sent along a letter with gates requesting the same information. we finally received a reply. i want to thanks secretary gates for responding and you in any role you might have played providing additional information.
however, was not only was the response tardy but incomplete. my colleagues and i requested the d od general and legal counsel about the a politic built of the braecht law and a copy and an analysis provided by senior staff for the secretary of defense regarding closure of u.s. jif-come. any business case analysis conducted related to the initiative, finally terms of reference provided to task force charged with implementing closure of u.s. jif-con. we received the term of reference for the task force but not the senior staffs analysis or any business case analysis. secretary lynn, will the department immediately provide the committee with the requests materials? >> mr. mckee on.
let me address that. the decision to recommend disestablishment was not based on a business base but a military rational. it was based on a review of the uniform command plan and the central purposes were. the provision of forces. joint training and doctrine. joint experimentation. after 30 meetings on those subjects with senior military leaders and senior civilian advisors the secretary concluded those no longer have a four star command and he so recommended to the president. it was a military rational that caused secretary to recognize the disestablishment of the forces command. not a business case. >> so there was nothing regarding any business was involved in the decision? >> the secretary looked at the
growth of the joint forces command. it tripped over the last decade with no fundamental change in it's mission and that caused him to look at that military rational and we're now engage in the review center by center. function by function as to which centers and which functions need to be retained and where they would be retained. in that review, the result office which we'll provide to the committee of course. we're looking at the - may i ask, when? >> as we develop the course of action and recommendations, be over the course of the fall. >> i think probably one of the problems of committee or at least myself is having, is - the things we've asked for is incomplete and we can't get an
answer as to when we'll get the things we've asked for and then you tell us that you've made decisions and your moving forward like we have no say whatsoever or no way to deal with this. and it leaves us somewhat frustrated. i think you can see from the chairman and myself the questions we have. i'm nopt saying that we're against this. it's just that we haven't seen the rational or the total - we don't understand totally the why and the where for? and we still have questions about that and when i ask when or if you'll give us this information, what's the response? we start - you start talking about that it's not a business decision but a military decision. okay so you made no business analysis? is that what i understand?
>> no. what i'm saying is that there was a military rational. i tried in my testimony to summarize that rational and we'll try - i understand - i'm trying say on the issues of the butts and how much savings there will be in a business case, that's being developed now. we think we'll be able to save a substantial part of the billion dollars. we have not developed all of the recommendations that lead to savings but the rational that caused the secretary to recommend this establishment. the second phase is to review which pieces stay and which go and what the net result in terms of savings are when you say business case i think that's what you want. saying that this is under way now and we'll provide it to the committee. >> okay. what you said is you made no business decision and you think
as time goes on you will look for savings and that's what we're talking about with business information on it? i'm trying i guess to understand that's where your going? i'm not too articulate but some of the things we're asking, let me go back down to eventually we'll get something about the business analysis. what about the military rational document? can we get that? >> well, we think we've answered that question in the testimony and the briefings in the material and the legal opinion, but i will go back to the department and see if there's more or a fuller explanation we can provide if the committee think it's requiring it. >> this committee, mr. secretary is the most sportive
of the military in congress and we're not trying to be - we just need to understand more fully where your coming from. there's a lot of rational to eliminate it your see saying. the chairman said who will take over the responsibility of jointn sed and you said i guess we don't need it anymore. we need to understand that. more completely. let me ask another question. in is - i share the secretary's concern the growth and department's top line is in sufficient don't request those provided by the military. one percent real growth is a net cut for investment and procurement accounts. this is not just my view.
independent panel appointed by congress recognizes this fact. the co-chair of that panel. bill perry under president clinton and steve hadly the national security advisor under george w. bush echoed the concerns of many on the committee. they're report rightly states our nation is not afford business as usual and warrants of a potential train wreck in the areas of personnel acquisition and poor structure. significantly it offer as real review of the global environment and maintaining and growing a lionss will place increased demand on american power and increase in the military's force structure. with that in mind i'm supportive to identify low priority programs. if we can translate that savings into structure and modernization
accounts, but we cannot be naive. what's the specific commitments if any, have you or the secretary received from administration that they will not attempt to harvest this savings for nondefense spending and they will appose any attempt by congress to do so and secondly, should you be successful in reinvested 100 billion over the next five years in accounts, how much more funding will be required to see sustained growth to 2-3 percent in these accounts and how do you propose to achieve this growth? >> the answer in the last question first, mr. mack keeb. the hundred billion dollar number comes from what we think it takes to get from the one percent top line growth to the two to 3%. the force structure and modernization accounts. that's how that calculation was done. we have the support of the
administration for the budget plan we've presented of one percent real growth and we've been trying get the support of congress. of course, we haven't heard the final bell on that yet. i guess i would come back mr. mckean and say the challenge here is that everyone supports our effort in general. supports reform in general, but has problems with each of the particular recommendations such as joint forces command such as deleting redundancy. i understand these are tough decisions but if we don't make them, we'll not get the hundred billion dollars. >> well, you haven't given us any savings yet for jif con. you haven't done a business analysis to come up that. that was a military decision so to count that in the hundred
billion is probably not - fair enough. before we submit the budget there will be savings coming from this initiative. >> we are - [laughs] okay. we're hoping there will be. we haven't seen that analysis yet. we're assuming at this point that there will be some savings generated. >> and it's fair to get that analysis before you judge it. >> that's what we would still like to see. thank you. >> as i understand it, you don't know how much you would save in efficiency by elimination of that command? >> we don't have net number yet. we know it costs about a billion dollars to operate that command every year and we will eliminate portions of that. the headquarters and some of the other functions and that will save some money and we'll provide that analysis the business case analysis as we proceed this fall.
>> as i see it, mr. secretary. somebody has to ride shotgun on jointness. i think that's given. the services - could very well, resort to stove pipe activities. without that joint doctrine being enforced one way or the other. that really worries me. >> let me ask general cart write to comment on that. >> by the way fold water nickels almost didn't include your job but we got it. >> i'm sincere yay! appreciative. congressman, as we looked at this activity i tend to be much
aligned and we've had many conversations about the jointnes and the incentives that drive us. we were clearly in need of getting more horse power in building jointness to the force when we moved to the construct of joint forces command. it was clear particularly in the areas of essential training, that the essential task list that we work with which we call military essential task list. these are the things that units use to train people and certify their people in their functionality. but they were doing it to service medals rather than to joint. one of the first tasks when they stood up joint forces command. we had to have sufficient joint power and authority aligned and able to say, this is what we want you to do and to develop those joint operating concepts that we worked so hard on for the latter part of the 90's and
the task listness to certify you in joint. about three years ago started transition the response to certify those to the services. because of the training activity and the essential task lists had been develop and were in fact demonstrating both through infrastructure the training ranges and capabilities they could in fact do this and would and saw the value in it. that's heart why we needed joint forces command and the fourth star to be there to drive this. not saying. the journey is done to joint, but the hard work we put into building training regiments and building distributed modeling and simulation that bring th forcing together has by and large been accomplished. the question is how to sustain it and i agree, who is
responsible and who gets up every morning worried if this force will stay joint? we're working through several courses of action through that it's going to be be somebody. somebody has to be accountle. we're working on that and have several options and we'll provide the committee with the results and an analysis we perform but at the end of the day i'm where you are. somebody has to get up every morning believing they're in charge of this. >> that's an excellent answer. however there should have been an answer, but there should have been an answer in place before announcing to this particular command, don't you think general? >> you announced you were going to get rid of it and we'll find a replacement. come on. mr. chairman, we understand and we believe that when we looked
at it's a joint chief's and made our recommendation to the secretary we could draw down from a four start command to some other general construct in the development of the business case and all of the other element office this activity. when we look at the full range of the courses of action. status quo is an option. it is an option we will fully investigate as to whether or not it's the option or not. but we're also looking at a full range from status quo to breaking down into agencies other commands and an assumption by other commands and divestture completely. the full range is presented as we present options to the secretary. i do not feel because the secretary set an objective of eliminated joint forces command that option is removed from us in consideration. now quite frankly we believe we
can produce this activity but it's still on the table. >> well, thank you for that. i hope you will keep in mind then services by nature will go back to the stove pipe doctrines of the past. and there needs to be - a joint activity to make this a continued success of jointness. mr. otiz? >> thank you mr. chairman and secretary leib and carter and cart write. i know you have huge responsibilities and serious obligations, but as i said before, in the same boat, so do we. you know, and i think that the joint forces command - correct me if i'm wrong - came about
because of the lessons learned. in the first person in golin th. we establish a base in there because of lessons learned in the persian gulf which was mind warfare. that case has since been moved and then been moved some place else and a human cost because where they moved did not have up for structure. this is why sometimes we're leery as to what is gone on all this studies and you know, when we want to buy something. we know that we need it. the longer that we wait, the more that it is going to cost. but - you know, secretary gates statement that there will be