Skip to main content

tv   Today in Washington  CSPAN  May 24, 2011 6:00am-9:00am EDT

6:00 am
four-year extension of the three expiring provisions without any substantive changes to the existing authorities, and i believe there does not need to be changes to existing authorities. regardless of my support for today's cloture vote and support for the four-year extension, i want my colleagues to know that i support a permanent extension of the three expiring provisions. having this debate year after year offers little certainty to agents utilizing these provisions to combat terrorism. it also leads to operational uncertainty, jeopardizes collection of critical intelligence, and could lead to compliance and reporting problems if the reauthorization occurs too close to the expiration of the law and we're getting very close to that.
6:01 am
if we believe that these tools are necessary -- and i clearly state i believe they are necessary -- we need to provide some certainty as opposed to simply revisiting the law year after year. given the indefinite threat that we face from acts of terrorism, it is my view that we should permanently reauthorize these three expiring provisions. this position is supported by agents on the ground using these tools every day. i have letters of support from the federal bureau of investigation agents association supporting a permanent reauthorization of the three expiring provisions. the federal law enforcement officers association also supports a permanent extension of the provisions. in fact, a very important passage of that letter states -- quote -- "crimes and terrorism
6:02 am
will not sunset and are still targeting our nation and american citizens. just like handcuffs, the patriot act should be a permanent part of law enforcement arsenal." then we have another letter from the society of former special agents to the f.b.i., and that letter -- quote -- "we urge congress to reauthorize the expiring provisions of the patriot act permanently and without restrictions as the three expiring provisions are essential to the security of our country." end of quote. mr. president, i ask unanimous consent that these letters be a part of the record. the presiding officer: without objection. mr. grassley: in addition to agents on the ground, we've heard strong support for extending the expiring provisions of the patriot act
6:03 am
from members of the bush and obama administrations. we've heard testimony from the director of the f.b.i., the attorney general and the director of national intelligence about the strong need to reauthorize these provisions. these same offices have recommended extending the provisions regardless of political ideology, as both republican and democrat administrations have backed the extensions. the four-year extension we're voting on today is a step in the right direction. extending the three expiring provisions without any substantive amendment that would restrict or curtail the use of these tools is very important given the recent actions that led to the death of osama bin laden. now is not the time to place new restrictions and heighten
6:04 am
evidentiary standards on critical national security tools. a lot has been said about these provisions, and unfortunately most of what has been said is incorrect. congress enacted these provisions and reauthorized them in 2005 following the 9/11 commission report which criticized the way our agents failed to piece together clues. in other words, to connect the dots. since that time the three expiring provisions have provided a great deal of information to agents that have helped thwart terrorist attacks. and let's be very basic, what is terrorism about? it's about killing people living in western europe and north america. they don't like us. they want to kill us. and we've got to prevent that. they can make continuing mistakes and not get their job done, but once the f.b.i. makes
6:05 am
a mistake and lets one of them get away, it's a victory for the opposition. we can't afford a failure. now, examples along the lines that we can't have these failures, in testimony before the house judiciary committee, subcommittee on crime, terrorism and homeland security, robert litt, the general counsel of the office of the director of national intelligence, testified that a section 215 order was used as part of the investigation by the f.b.i. in the khalid aldawasa r*eu who was arrested in texas recently. mr. litt also testified the 215
6:06 am
orders were utilized to obtain hotel records in the case where a suspected spy had arranged lodging for intelligence officers. he also discussed the roving wiretap provisions and how it is used to help agents track foreign agents operating inside the united states who switch cellular phones frequently to avoid being caught. these examples are limited not because the authorities aren't valuable, but because of how sensitive the investigations are that utilize these authorities. while the need for keeping personal national security matters classified may prevent the open discussion of further examples in this setting here on the floor of the senate, it is important to note that these provisions are constantly under strict scrutiny by the inspector general at the department of justice and by congressional
6:07 am
oversight. in fact, in a march 2008 report, the justice department inspector general examined the f.b.i.'s use of section 215 orders and found -- quote -- "we did not identify any illegal use of section 15 authority." end of quote. further, there are no reported abuses of the roving surveillance authority and the lone wolf provision has not yet been utilized, so it is without abuse as well. while i tkpwhrae these three provisions -- while i agree these three provisions should be subject to strict scrutiny, oversight authority already exists in the law and does not provide authority for these tools to achieve the goal of oversight. as such, it is important that congress reauthorize these provisions quickly and without amendment. i urge my colleagues to vote in support of the cloture petition on the motion to proceed to
6:08 am
s. 1038 because it provides a clean reauthorization of these very vital tools for four years without substantive changes. in other words, if it ain't broke, don't fix it. while four years is a far cry from the permanence that i feel is necessary on these provisions, it does provide more certainty and predictability than continuing to pass short-term extension after extension. i yield the floor. a senator: mr. president? the presiding officer: the senator from kentucky. mr. paul: there's been a lot of discussion of the patriot act, and we're told basically we wouldn't be able to capture these terrorists if we didn't give up some of our liberties, if we didn't give up some of the fourth amendment and allow it to be easier for the police to come into our homes. we were so frightened after 9/11
6:09 am
that we readily gave up these freedoms. we said, well, the fourth amendment is not that important. we'll just let the government look at all of our records and we'll make it easier for the government to look at our records. the question you have to ask, though, is whether or not we would still be able to catch terrorists by using the fourth amendment as it was intended and having the protections of the fourth amendment. what you have to ask yourself is think about the worst person in your community. think about someone accused of murder or rape or a pedophile. you think of these people; do you know what happens if someone is accused of that? even if it's 3:00 in the morning and they want to get their records or they want to go into their house, they call a judge. this is something very important. they get the warrants almost all the time. but it's one step of protection. what you have is the protection where you don't have police officers writing warrants to come into your house. you have to have it reviewed by a judge. what we've done to the patriot
6:10 am
act is taken away some of the protections of the fourth amendment. the fourth amendment says you need to name the person and the place to be searched. we've taken away those protections. the fourth amendment says you need to have probable cause. we've taken away those and made it to where it, if it's relevant or they think they might be related to it. originally the fisa court lowered the standard somewhat on the fourth amendment, but it recognized that it was lowering the standard and was careful. we had secret courts set up and the fisa court was the court that dealt with things that had that to* do with national security or terrorism or intelligence. the information was kept secret so we didn't let everybody in the world know the name but the name had to be die srulged to the judges. those who argue you have to have the patriot act, tough do this or we will not be able to stop terrorism, they need to explain why the fisa court did tens of thousands of search warrants and
6:11 am
never turned any down. in fact, the history before the patriot act was no search warrant had ever been turned down. do we really want to give up our liberties in exchange for miles-per-hour security? franklin -- in exchange for more security. franklin said those who give up liberty in exchange for security may end up with neither. right now if you have a visa bill that's over $5,000 and you choose to pay for it over the phone which is a wire transfer, the government is probably looking at your visa bill. they don't have to show probable cause and they don't have to have a judge's warrant. and this does apply to u.s. citizens. often they'll tell you it's only foreign terrorists we're looking at. they want you to feel good about allowing the spying, but this spying is going on by the tens of thousands and even by the millions. with regard to these suspicious activity reports, we've done over 4 million of them in the last ten years. we're now doing over a million a year. these suspicious activity
6:12 am
reports, all the trigger is you don't have to have anything to do with terrorism. the trigger is you have over $5,000 that you transfer by bank account. you say, well, the courts have decided that your bank records aren't private. well, the hell they aren't. they should be private. my visa records, if you look at my visa records, you can tell whether i go to the doctor, what kind of doctor i go to. you can conceivably tell what kind of medication i'm on. you can tell what kind of magazines i read. you can tell what kind of books i order from amazon. do we want a government that looks at our visa bill? do we want a government that looks at our records and is finding out what our reading habits are. one of the provisions apply to library records. do you want the government to find out what you're reading at the library? we now have a president that wants to know where you contributed before you do work for the government. do we want that kind of all-encompassing government that is looking at every record from top to bottom and invading our
6:13 am
privacy? there is another aspect of this called national security letters. these are basically warrants that are written by f.b.i. agents. no judge reviews them. this is specifically what james otis was worried about when he talked about general warrants that weren't specifying the person or the place and that were written by police officers. and this is a problem because really this is -- we depend on the checks and balances in our society. we never want to give all the authority to either one group of congress or to the president or to police or judges. we have checks and balances to approve -- to try to prevent abuse. now, some have said, well, if you have nothing to hide, why do you care? well, the thing is that it will not always be angels that are in charge of government. you have rules because you want to prevent the day that may occur when you get someone who takes over your government through elected office or
6:14 am
otherwise who really is intent on using the tools of government to pry into your affairs, to snoop on what you're doing, to punish you for your political or religious beliefs. that's why we don't ever want to let the law become so expansive. but the thing is you have to realize that you can still get terrorists. we get rapists and murderers every day by calling a judge. that's what i'm asking for. i'm asking that we go through and obey the fourth amendment. many conservatives argue that well they love the second amendment. some liberals say they love to be able to protect the first amendment. if you don't protect the entire bill of rights, you're not going to have any of it. if you want to protect your right to own a gun, you need to protect your gun records from the government looking at your gun records and finding out whether you've been buying a gun at a gun show. you need to protect your privacy. if you want to protect the first amendment, you've got to have the fourth amendment. in fact, we specifically had to go back there. the original patriot act said
6:15 am
that you couldn't even consult with your attorney. you couldn't even tell your attorney -- you were gagged from telling your attorney. even know, though, you say i don't know if they've investigated me. you know why? because they tell your phone company if they're looking at your phone records right now or your visa records, it's against the law for visa or the phone company to tell you that. it's hundreds of thousands of dollars of fines and jail time. it's five years in jail if your phone company tells you they have been spying on you. now, some of this doesn't even require a letter from government. some of it is done by the banks. the suspicious activity reports, we have simply told the bank here, anybody that deals in cash, anybody that has over a a $5,000 transfer, wire transfer or who deals in large amounts of money, the bank -- it's incumbent upon the bank to spy on their customers now. this is a real problem, and i think that we need to have some argument and debate in our
6:16 am
country over these things. some want to have these things permanently. they want to permanently give up their fourth amendment protections, and i disagree strongly. not only would i let these expire, but i think we really should sunset the entire patriot act and protect our liberties the way it was intended by our founding fathers. james otis was an attorney in boston, and he wrote about these things they called in those days writs of assistance. these were general warrants. the king would write them, or actually they were written by soldiers here. they didn't name the person to be searched or the place, and they were used as a way to have the king have his way with the people and to bully the people. the idea of general warrants is what really sorely offended our founding fathers. that's why we got the fourth amendment. the fourth amendment was the product of a decade or more of james otis arguing cases against the british government. but the question you have to ask yourself when thinking about these issues is it's not so
6:17 am
simple that you can just say well, i'm either against terrorism or i'm going to let terrorists run wild and take over the country. you can be opposed to terrorists. we can go after terrorists. we can go after murderers and rapists and people who commit crimes, but we can do it with a process that protects the innocent. you know, we -- we looked at -- i think so far they say we have looked at 28 million electronic records. we have looked at 1,600,000 text messages, and we have 800,000 hours of audio. we have so much audio that they can't even listen to it all. 25% of what they have recorded of your phone conversations is not listened to because they don't even have time to listen to it. my point would be that we're eavesdropping on so many people that it could be that we are missing out and not targeting. it's just like the airports. every one of you is being searched in the airport and you're not terrorists and you're
6:18 am
no threat to our country. why are we not looking for the people who would attack us and spending time on those people? why do we not go to a judge and say this person we this terrorit group, will you give us a warrant? why don't we have those steps? instead, we're mining and going through millions of records, and i think we're overwhelmed so much with the records that we may well be doing less of a good job with terrorism because we're looking at everyone's records. but the bottom line is i don't want to live in a country where we give up our freedoms, our privacy. i don't want to live in a country that loses its constitutional protections that protect us as individuals. we do have a right to privacy. you have a right not to have the government reading your visa bill every month. we do have rights and we should protect these, but we shouldn't be so fearful that we say well, i'm a good person, i don't care, just look at my records. if you do, you're setting yourself up for a day when there will be a tyranny, when there will be a despot who comes into
6:19 am
power in the united states and who uses those rules that you said oh, i don't have anything to hide. what happens when someone takes over who believes that your religion is -- is to be combated, who believes that your political beliefs and your literature should be combated? what happens when that day comes? we cannot give up -- our liberty. if we do, if we trade it for security, we'll have neither. so i rise in opposition to the vote on cloture. i will be introducing amendments to the patriot act this week, and we will be having a real debate about how we can stop terrorism but also preserve mr. grassley: i yield the floor. a senator: mr. president? the presiding officer: the senator from georgia. mr. chambliss: mr. president, i rise in support of invoking cloture on the motion to proceed to s. 1038, the patriot sunset extension act of 2011. in four days on may 27, three
6:20 am
fisa provisions, the lone wolf, roving wiretap and two section 315 authorities will expire unless congress acts to reauthorize them. the house has been working on a bill, h.r. 1800, that would make the lone wolf provision permanent and extend the other two provisions until december, 2017. senator feinstein and leahy have sponsored bills that would, among other things, extend all three provisions until december, 2013. it seems to me that 1038 with its extension of the three sunsets until june 1, 2015, is a reasonable compromise. although i believe that each one of these two should be made permanent, this bill will ensure that our intelligence professionals have the tools they need to keep our nation safe. there is little disagreement that these provisions should and must be reauthorized. f.b.i. director robert mueller has testified repeatedly that each one of these provisions is
6:21 am
important to both national security as well as criminal investigations, but the importance does not end there. because of enhanced information-sharing rules and procedures, other parts of the intelligence community like the national counterterrorism center and the national counterproliferation center, often depend on the information collected under these provisions. losing or changing these authorities could adversely impact the intelligence community's ability to analyze and share important national intelligence information. according to director mueller, with all the new technology, it is easy for a terrorist target to buy four or five cell phones, use them in quick succession, and then dump them to avoid being intercepted. he has testified that the ability to track terrorists when they do this is tremendously important. i couldn't agree more because it's pretty obvious those guys
6:22 am
are up to something and it's not good. our enemies often know our own laws better than we do. they understand the hoops and hurdles the government must clear to catch up to or stay ahead of them. keep in mind that the f.b.i. cannot use a roving wiretap until a court finds probable cause to believe that the target is an agent of a foreign power. some critics claim the provision allows the f.b.i. to avoid meeting probable cause as surveillance moves from phone to phone. this claim is simply not accurate. as every roving wiretap must be approved by a fisa court judge. if a target changes a cell phone and the f.b.i. moves to surveil a new phone, the court is notified of that change. all of the prebz -- protections for u.s. person information that apply to any other fisa wiretap also applies to roving wiretaps. in short, while this authority
6:23 am
is a tremendous asset for the f.b.i. and has been used 140 times over the past five years, it poses no additional civil liberties concerns and it should be renewed without delay. with regard to section 215, the business records act, over the past several years, the rallying cry against the patriot act has centered on section 215, fisa business records authority. section 215 allows the f.b.i. to seek fisa court authority to obtain business records such as hotel information or travel records. as with each one of the expiring provisions, the f.b.i. must meet the statutory standard of proof. the inspector general from the department of justice conducted several audits of the f.b.i.'s use of section 215 orders and found no abuses of the authority. director mueller testified that the business records sought by the f.b.i. and terrorism
6:24 am
investigations are absolutely essential to identifying other persons who may be involved in terrorist activities. the lone wolf provision, the sole expiring provision under the patriot act that has not been used by the f.b.i. prompting some critics to demand its repeal is the lone wolf definition of an agent of a foreign power. recent events have demonstrated that self-radicalizing individuals with no clear affiliation to existing terrorist groups are a growing threat to national security. the lone wolf provision provides a counter to that threat, at least in the cases of a non-u.s. person who is readily identifiable with a particular foreign power. the lone wolf provision is a necessary tool that will only need to be used in limited circumstances. it's kind of like those in case of emergency break glass boxes that cover certain fire alarms and equipment.
6:25 am
while we may not use it too much, we will certainly wish we had it when the right situation comes up. in conclusion, i am grateful for the leadership of senators reid and mcconnell on this crucial piece of legislation. this bill will ensure that our intelligence and law enforcement professionals can continue doing what they do best, without any additional restrictions. our nation has been fortunate to have not suffered a sequel to the 9/11 attacks, and much of the credit goes to the dedicated work of our intelligence and law enforcement professionals. we owe them not only our thanks but the recognition that their jobs are as difficult as it is, and we should not be taking any steps that will make their responsibility to protect this country any more difficult. mr. president, i urge the vote in support of invoking cloture on the motion to proceed, and i yield the floor and
6:26 am
6:27 am
6:28 am
6:29 am
6:30 am
6:31 am
6:32 am
6:33 am
6:34 am
6:35 am
6:36 am
6:37 am
6:38 am
6:39 am
6:40 am
6:41 am
6:42 am
6:43 am
6:44 am
6:45 am
6:46 am
6:47 am
6:48 am
6:49 am
6:50 am
6:51 am
6:52 am
6:53 am
6:54 am
6:55 am
6:56 am
>> lovia. floor and love yeah. love ya. love y'all.
6:57 am
love y'all. my, my, my. love you. i've got to tell you, let me thank you. i see some people out there, a few back there yelling. and i understand that my aunt bessie is here. oh, there she is. now, do you know why it is so momentous that my aunt bessie is here? she hasn't decided if she can vote for me yet. but i'm going to change her mind. just like we are going to change the mind of a lot of folk in america. but i want to thank all of you
6:58 am
from the bottom of my heart for you being here. because there was some skeptics, as you know, who didn't think anybody would show up for an announcement for me. and the last time i heard, there are 15,000 of you all right here. thank you. thank you. you know, it has been this kind of encouragement that has gotten me to this point. and it is this kind of encouragement that i believe and i know is going to take us to where we are trying to get to. you know, many of you know that
6:59 am
i grew up right here in atlanta, georgia. right here in atlanta, georgia. i stand in the shadows of my upbringing. i stand here today as the son of a shaufer and a domestic worker, who taught me and my brother three of the most important values we could have ever learned. belief in god. belief in what we can do for ourselves. and belief in this exceptional nation called the united states of america. believe in it. you know, the peo
7:00 am
you know the people that are struggling to most of the ones who don't believe in this nation. my parents never uttered the words victim because they never felt like a victim having the opportunity to be in this nation despite the challenges. so i stand here today as luther and little work's whole list ol my home town. i stand in the shadow of the olympic flame which represents the determination of those who go to the olympics every four years with their own
7:01 am
determination but it also signifies the great spirit of this great country, the spirit of america. that is what it signifies. [applause] and it is the spirit of america and determination of america that we are going to take our country back. this they, this our, in the spirit of america and the spirit of the olympics here when people go to the olympics every four years they don't go to the olympics to come in second. they go to the olympics to win.
7:02 am
and you see, just like the spirit of the olympics. nil number 2 is not in america's be and a. we don't do number 2. right here this day, this our, this moment of, reminds me of the closing song of the 2000 olympics. life can be a challenge. life can seem impossible. it is never easy when there's so much on the line but you and i can make a difference. there is a mission just for you. there is a mission just for me.
7:03 am
just look inside and you will find just what you can do. [cheers and applause] right here, list theday, this and this moment i have looked inside of me and among thousands and thousands of my friends and with my family here with me and associates i have known through the years, this day, this our, this moment i came to declare my
7:04 am
candidacy for the republican nomination of president of the united states of america. this moment. this moment. [cheers and applause] and just to be clear, just to be clear, in case you accidentally listened to a skeptic were doubting thomas out there, just to be clear let me say it again. i am running for president of the united states and i am not running for second! i am not running for second!
7:05 am
[cheers and applause] this day. let me tell you. because i have had reporters asked me have you run just to get attention and come in second? you don't know very much about me. you don't run for second. i don't run for second. i run to be number 1. let me tell you some of the reasons why i am running for president of the united states. one of the biggest reasons is that we have become a nation of
7:06 am
crises. we have a model crisis. we have an economic crisis. we have an entitlement spending crisis. we have an immigration crisis. we have a foggy foreign affairs crisis. we have a deficiency of leadership crisis in the white house. [cheers and applause] there's a big difference between leadership and positionship. a big difference. between leadership and positionship. let's look at the facts. relative to all these crises. we have anemic economic growth. in the first quarter of this
7:07 am
year howard gdp only grew by 1.8%. that is anemic especially when china is growing at 10% and if we don't increase our growth rate they are going to be as big as we are in five years if you take out the difference in exchange rates. like i said earlier, if we allow china to become as economically powerful as us you know that they're going to try to develop their military might as big as ours. i will not allow america to be number 2 militarily or economically on my watch. not on our watch. we are a nation of crises. look at the facts. don't listen to the rhetoric.
7:08 am
and 9% unemployment rate, fifteen million people out of work. seven million people on food stamps. that is fourteen million more than there were when the current occupant of the white house took over. $4 a gallon for gas. and it is not over yet. $1 trillion in spending to stimulate the economy and it didn't stimulate diddley. [cheers and applause] all of that and now to have a $14 trillion national debt and a debate in washington d.c. going on about do we raise the debt ceiling again? let me tell you what the herman cain doctrine would be.
7:09 am
we are not raising the debt ceiling, we are going to stop the spending! it is all reduced. so look at the facts. don't just listen to the rhetoric. look at the facts. the stuff is not working. it is not working. the only thing i can conclude is it is time to get real, folks. it is time to get real. hope and change ain't working. hope and change is not a solution. hope and change is not a job. hope and change is not a new business. hope and change is not a vision. we need a new vision in this country and that means we need a new person leading this nation
7:10 am
in the white house. it ain't working. i want to ask you a few questions. is america ready for real results? is america ready for common-sense solutions? is america ready to rekindle the spirit of america? and is america ready for a real leader, not our reader? you want a leader? or do you want a reader?
7:11 am
[crowd chanting] it took some people to connect the dots on that last. they were of little slow. since you answered yes to those questions let me describe our new vision. i don't call it my vision. my job as a leader is to be fine it, share it with you. it becomes our vision. i can do this by myself. this has to be our vision, not a political vision, not the agenda of one person. it has to be the agenda of the
7:12 am
people of this country. in order for us to be able to achieve and make reality our vision, we are going to need some new plans. and personally, get some new people around the president. this president, much better than the ones we got. [applause] our new vision, real economic growth, not anemic growth. we have to lower tax rates for corporations and individuals, we have got to defend the capital gains tax to zero and give the workers of america a real
7:13 am
payroll tax holiday and make the tax break permanent. [applause] that will lead to economic growth. our mission, a real energy independence plan. real one. not one that somebody reads off of a teleprompter. a real one. one of the things that is so frustrating is we have the resources to become energy independent. we simply need to pool resources together in order to make it happen. that is our vision. i will never go to a foreign country or brazil, loaned them money and then tell them we are going to be their best customer
7:14 am
for their oil. let me assure you another one of the herman cain doctrines. america is going to be its own best customer. drill here, drill now, right here in the u. s. a.. we will be our own best customer. as president of the united states i am going to make sure we are our own best customer when it comes to our energy needs and energy resources. not that we don't have the resources. we just have too much bureaucracy that keeps getting in the way. our new vision means immigration through the front door and not through the back door, not
7:15 am
through the side door. this nation was built upon immigrants, legal immigrants. and if we attack the right problem which is we have more problems, not one. we have to secure the border, and force the laws that are there, promote the path to citizenship that is already there, clean up the bureaucracy. you don't need a new path to citizenship. we already have one. why don't you ask the millions of people who came here illegally? they will tell you. the fourth thing we have to do in order to deal with the illegals that are already here, the federal government won't solve the problem. in our new vision we will empower the states to solve the problem of those that are here. that is how we take care of that
7:16 am
problem. the last thing you will get from herman cain presidency is suing the estate because they're trying to protect themselves. we should not be suing arizona. we ought to be sending them a prize! the peace prize! [cheers and applause] suing the state of the united states of america. there's a major disconnect. our new vision, real energy economic growth. real energy independence. immigration through the front door, not the back door or the side door. and real, clear foreign policy. real clear. i love it. when the skeptics want to
7:17 am
criticize me because of lack of foreign-policy experience. let me tell you what i know about foreign policy experience. i know that you don't throw your friends under the bus. that is what i know about foreign policy. [cheers and applause] you don't need the state department to figure that out. no the your friends are and who your enemies are and don't throw your friends under the bus. i was shocked last week. i think it was thursday. when president obama through israel under the bus. let me tell you what the herman cain doctrine would be relative
7:18 am
to our friends and i will share with you my doctor and relative to our enemies. i have some stuff for them too. relative to israel that most of us have appreciated the relationship for decades. the herman cain doctrine to the world would simply be if you mess with israel you are messing with the united states of america. don't mess with us! don't mess with us! is that real clear? is that real clear? that is one i mean by real clear foreign policy. no who your friends are. know who your enemies are. and it is our new vision. not the establishment, not the
7:19 am
politicians. it is our new vision. lastly, this nation has gradually over the years slipped into an entitlement society. i am going to tell you, folks, not only do i believe it is possible but i know that it is time, restructuring programs instead of reshuffling programs, we can take this entitlement society to and empowerment society. empower people! empower states, empower businesses. we can become an empowerment society where our new vision,
7:20 am
with our new vision. you know the founding fathers did their job. and they did a great job that it. they kept it simple. they wrote the declaration of independence. they designed and wrote the constitution of the united states of america. one of the other things that is part of our vision is we don't need to be right the declaration, we don't need to rewrite the constitution of the united states. we need to read read the constitution and enforce the constitution. [applause] we don't need to rewrite, let's 3 read.
7:21 am
some people and not going to do that so for the benefit of those that are not going to read it because they don't want us to go by the constitution there is a section that talks about life. original liberty and the pursuit of happiness. you know those ideals we live by and believe in and they instilled in you. when you get to that part, don't stop right there. keep reading. that is when it says when any form of government becomes destructive of those ideals it is the right of the people to offer no apologies. we have some altering of policies to do. [applause] in 2012, we are not only going to keep control of the house of representatives but also control the united states senate and take it back.
7:22 am
and in 2012 we are also going to run the trifecta and alter the occupant of the white house with a new president. [cheers and applause] lastly -- thank you. [crowd chanting] and for sure, we are all going to have to work a little harder. we are going to have to work a little smarter. we are not going to convert every body over to our conservative way of thinking. we are not going to sell everybody on our new vision. with new leadership, new people, new ways to think about it. a good friend told me once all
7:23 am
you can do is save this a viable. between november and 2012 are and going to save my aunt bessie. [cheers and applause] >> i think she has got hold. we have got a lot of work to do but i believe we can do this. if i didn't believe we could do this i would not be doing and. we have to be doing a little bit more. we have to work a little bit harder to take back this country. is going to be tough. i am up for the fight. i know you are too. the founding fathers did their job. we have to do our job and be the defending fathers. i have been blessed with two
7:24 am
adult kids. they are grown and gone. we have three grandkids and it is not about us. it is not about us. i know that everybody feels that way. from a traveling all over the country and talking to groups day in and day out, town hall meetings, large rallies, the message has been consistent is not about us and people need to do whatever it takes in order to take this nation back and i firmly believe in my heart that god is in this journey. that god is in this journey. and in november of 2012, the day after election day when we wake up that morning and all of the
7:25 am
folks have counted and they declare not only all of the local election results, the statewide election results, the congressional results, the senatorial results, but when we wake up and they declare the presidential results and herman cain is in the white house, we will all be able to save free at last! free at last! if a god almighty, this nation isthank god almighty, this nati is free at last again! god bless you! god bless the usa! [cheers and applause] thank you.
7:26 am
thank you very much. this is my family, along with you. i wanted you to see them because this thing is going to move so fast you had better look quick. thank you again, ladies and gentlemen. thank you. thank you very much. thank you. thank you very much. thank you very much. god bless you. god bless you. god bless you. god bless each and every one of
7:27 am
you. [cheers and applause] [cheers and applause] [crowd chanting] [applause]
7:28 am
[inaudible conversations] >> nice to meet you! god bless you. >> thank you! [inaudible conversations] [inaudible conversations]
7:29 am
[inaudible conversations] [inaudible conversations] [inaudible conversations]
7:30 am
[inaudible conversations] [inaudible conversations] ..
7:31 am
[inaudible conversations] [inaudible conversations]
7:32 am
>> now we'll hear from former minnesota governor tim pawlenty who announced he is running for president. his remarks in des moines, iowa, our 55 minutes. >> thank you very much. good morning. thank you, all of you, for being here. in the fall of 1983, i met tim pawlenty, and i knew at that time that i had met someone extraordinary. and through our lives together, and through our now more than 23 years of marriage, i have come to know well and love his family, his cousins and aunts and uncles and brothers and
7:33 am
sisters who, like tim, are the salt of the earth. these are folks who are from the heartland, who have a strong work ethic, and a deep love for family. and i watched tim love up on and laugh with our children as they have grown. and i have lived and breathed life with him as he has gone through his political career, and watched him through the political battles with political opposition, and had many moments where i've thought how in the world will he find his way out of this. but he is a man whose internal compass is set so true that he always found a way to lead
7:34 am
minnesota and to a better place. i had the good fortune and opportunity to be a long site him during his time as governor in many parts of the world, whether it was in china or south america, europe, or india, or in a country that is particularly dear to our hearts, israel. and to all those experience, i watched my husband we then blended together his knowledge, his expertise, with his ability to form amazing lasting relationships. and it's tempting, i presume, to assume that his spouse of so many years would stand here and be supportive simply from the heart. and, of course, i am supportive from the heart.
7:35 am
but all that i know and all that i have witnessed about my husband has me supporting him in equal measures, with my heart and my head. i am completely certain that he is the best person for the job. my husband is a man of great character, courage, good judgment, wisdom, discernment. and he has the experience to be the next president of the united states. he is a man who speaks truth to power, but always with a great fullness of grace. so ladies and gentlemen, my husband, governor tim pawlenty. [cheers and applause]
7:36 am
>> thank you. thanks, honey, for those tremendous remarks. very gracious and kind remarks, and for your love and for your support for all these years. after serving eight years as minnesota's governor, i was very much looking forward to life with mary and our two daughters in the midwestern know that we love. with mary's encouragement and wise counsel, we came to a different conclusion. and that's what brings me here today with this announcement. i'm tim pawlenty and i'm running for president of the united states. [cheers and applause]
7:37 am
>> we live in the greatest country the world has ever known, but as we all know america is in big trouble. and it won't get fixed if we keep going down the same path. if we want a new and better direction, we are going to need a new and better president. president obama's policies have failed, but more than that he won't even tell us the truth about what is really going to take to get out of this mess that we are in. i could stand here and tell you that we can solve america's debt crisis, fix our economy without making any tough choices your we've heard those kinds of empty promises before, and for the
7:38 am
last three years, and we know what that has gotten us. promises of hope and change. they don't buy our groceries, make our mortgage payments, put gas in our car or pay for our children's school clothes or other needs. so in my campaign i'm going to take a different approach. i'm going to tell you the truth. and the truth is, washington, d.c. is broken. our country has gone broke, and the pain of the recent recession will pale in comparison to what's coming if we don't get spending in washington, d.c., under control. president obama doesn't have an economic plan. [applause] >> president obama doesn't have an economic plan. he just has a campaign plan. and united states of america deserves much, much better. president obama promised that
7:39 am
spending $800 billion on a pork filled stimulus bill would keep unemployment under 8%. he promised that bailouts for well-connected businesses were a good deal for the country. he promised that a federal takeover of health care we keep costs under control. and as hard as it is to believe, he even promised that he would cut the deficit in half during his first term as president. the truth is, since president obama took office, the massive numbers of spending decisions that he has made, the debt has gone through the roof, americans can't find jobs, and we are $4 trillion deeper in debt. and his health care plan is an unmitigated disaster for our country. [applause] >> we've tried, president obama's way. and his way has failed.
7:40 am
three years into his term we are no longer just running out of money. we are running out of time. it's time for new leadership. it's time for a new approach. and it's time for america's presidents and anyone who wants to be president to look you in the eye and tell you the truth. so here it is. government money isn't free. you an idea to pay for it in taxes or our children pay for it in debt. the reforms we need are not in the billions. they are in the trillions of dollars. and the cats we need to make, the cats we must make can't just be to somebody else's program. the changes history is calling on americans today to make can't be shouldered by people richer than us or poor than us. but by us, too. obligations are often afraid that if they are too honest they may lose an election.
7:41 am
i am afraid that in 2012 if we are not honest enough we may lose our country. [applause] >> if we want to grow our economy, we need to shrink our government. if we want to create jobs, we need to encourage job creators. if we want our children to be free to pursue their dreams, we can't shackle them with our debt. this is a time for the truth. that's why later this week i'm going to new york city and i'm going to tell wall street that if i'm elected, the era of bailouts, and that's, carveouts are over. [applause] >> no more subsidies, no more special treatment, no more fannie and freddie, no more t.a.r.p., and no more too big to
7:42 am
fail. [applause] >> success in our economy once again must be determined by the ingenuity of competing businesses, and the judgment of the marketplace, period. but there's more. tomorrow i'm also going to florida to kill both young people and seniors the truth about our entitlement program. they are on an unsustainable path, and that in action is no longer an option. our national debt combined with obamacare have placed social security, medicare and medicaid in real peril. i'm going to tell young people the truth, the overtime and for thethe moment, we're going to he to gradually raise the social security retirement age. i'm also going to tell the truth to wealthy seniors that we will have to means test social security and the annual cost-of-living adjustment.
7:43 am
medicare must also be reformed. we're going to do it with pay for performance incentives that reward good doctors and wise consumers. and we need to block medicaid to the states. their innovative ideas and approaches closest to the patient are not only going to solve problems, they are going to save money. and in this week i will also be in washington, d.c., -- [applause] >> in washington, d.c., i'm going to remind the federal bureaucrats that government exists to serve the citizens, not its employees. [applause] >> and the truth is people getting paid by the taxpayers shouldn't get a better deal than the taxpayers themselves. [applause] >> that means freezing federal salaries, transitioning federal employee benefits, and downsizing the federal workforce
7:44 am
as it retires to it means paying for results, not just in your to. and it means from the capital to the classroom and everywhere in between. we're going to make public employees more accountable and their pay and benefits more in line with the rest of the taxpayers of this country. [applause] >> and in the private sector it means no card check. not now and not ever. [applause] >> and it means no more taxpayer bailouts just because you make big campaign contributions to politicians, or just because you may have a lot of money given away to people or special interests who are trying to influence our government. we also need to make sure that the national labour relations board understand that never again will an american company be told where they can and can't do business.
7:45 am
[applause] >> i'm here today to tell iowans the truth, too. america is facing a crushing debt crisis. the likes of which we have never seen before. we need to cut spending and we need to cut it big time. the hard truth is there is no longer any sacred programs to the truth about energy subsidies, including federal subsidies for ethanol, is that they have to be phased out. we need to do it gradually. we need to do it fairly, but we need to do it. i'm not some out of touch politicians from some other part of the country here i served two terms as governor of an agricultural state. i fully understand and respect the critical role farming place in our economy and our society. i strongly supported ethanol in various ways over the years, and i still believe in the promise
7:46 am
of renewable fuel both our economy and for our national security. but even in minnesota when we face fiscal challenges, we reduced ethanol subsidies. that's what we are now in washington but on a much, much larger scale. it's not only ethanol, we need to change our approach to subsidies in all industries. it can't be done overnight. the industry has made large investments and it wouldn't be fair to pull the rug out from underneath and immediately but we must face the truth. if you want to invite more competition, more investment and more innovation into industry, we need to get the government out. [applause] >> we also need to get the government out of the business of handing out special favors, special deals. the free market, not freebies from politicians, should decide a company's success. so as part of a larger reform,
7:47 am
we need to phase out all subsidies across all sources of energy and all industries, including ethanol. we simply can't afford them anymore. now, some people are going to be upset about what i'm saying. conventional wisdom says you can't talk about ethanol in iowa or social security in florida for financial reform on wall street, but someone has to say it. someone has to finally stand up and level with the american people. someone has to lead. i will. [applause] >> when times get tough, the temptation among many people to try to turn americans against one another. some try to fan the flames of in the msm and as way to deflect attention from their own responsibilities. we particularly see this from
7:48 am
politicians. but that's not good enough anymore. our problems demand and our children deserve much more from us this done. no president deserves to win an election by dividing the american people. picking winners and losers, protecting his own party's spending and cutting only the other guys programs, getting classes and ethnicities against each other. the truth is we are all in this together. so we need to work together to get out of this mess. i will unite our party, and i will unite our nation because to solve a $14 trillion problem, we are going to be 300 million people. [applause] >> leadership in a time of crisis isn't about telling people what you think they want to hear. it's about telling the truth.
7:49 am
president barack obama refuses to do that. he has a sample and cynical plan, pretend there's no crisis and attack those of us who are willing to stand up and try to solve it. in washington, then they call that smart politics. but i'm not from washington. i grew up in minnesota. [applause] >> i grew up in the hard-working blue-collar town of south st. paul. when i was 16 years old, my mom passed away of ovarian cancer. and while later my dad lost his job for a while. in a situation like that, you see some things and you learn some things. at a young age i learned the value that we needed faith in god and challenging times, and in all times. i saw the value of a loving family that rallied around each other in times of crisis. i learned the value of hard work and responsibility for doing my
7:50 am
part. i learned that education is the ticket to opportunity. i learned the value of a job, and a paycheck. i had a chance to work in a grocery store for about seven years. i was a union member. i was proud to earn some money to help pay for school costs and to help make ends meet. the values i learned are america's values. i know the american dream because i have lived it. i'm running for president to keep that dream alive. [applause] >> the first step towards restoring america's promise is to elect a president who keeps his promises to america. how do i know that conservatives value, principles can rest our economy and reform our government? because in minnesota for the last eight years already have. i love my state. and let's face it, it's one of
7:51 am
the most liberal states in the country. minnesota's big government legacy presented me with the same types of problems barack obama found in the nation's capital, but my approach and my results were very different. when i became governor, minnesota's to give budget had been it -- have been increasing every two years for over 40 years. during my eight years as governor that changed dramatically. i passed a budget that actually reduce state spending in real terms for the first time in 150 years in my state. [applause] >> for decades before i got elected, governors tried to get minnesota out of the top 10 highest state in taxes. that was their goal. i actually did it. minnesota also faced health care costs that were spiraling out of control. does that sound familiar? i know how to do health care
7:52 am
reform right. i've done it at the state level. no mandate, no takeovers, and it's the opposite of obamacare. [applause] >> i took on the public employee unions before it was popular to do it. for example, our government bus drivers had benefits similar to those that are breaking budget in california, illinois, and all over europe your i wanted to bring those benefits in line. the union refused and went on strike. became one of the longest strikes in the history of the country, transit strike. people ticketed my house. the media trash become and the buses didn't move. but needed we. and on the 45th day of the strike the union came back to the table and the taxpayers one. [applause] >> today we have a transit
7:53 am
system that gives commuters a ride without taking the taxpayers for a ride. [applause] >> i stood up to the teachers union and establish what the first statewide system for performance pay for teachers in the country, and i appointed new conservative justices to the supreme court. they understand that judges are supposed to rule according to the law, not the preferences of their party. and you know something about that here in iowa. [applause] >> in minnesota and washington the issues were the same. taxes, spending, health care, unions, the courts. but in washington barack obama has consistently stood for higher taxes, more spending, more government, more powerful special interests, and for less individual freedom. in minnesota i cut taxes, cut spending, instituted healthier
7:54 am
choice for performance pay for teachers, reforms in the benefits and appointed constitutional conservatives to the supreme court. that's how you lead a liberal state in a conservative direction. [applause] >> the problems we face as a nation are severe. but if we could move minnesota and a commonsense conservative direction, we can do it anywhere, even in washington, d.c.. but it's not going to be easy. but it's not supposed to be. this is america. we don't do easy. valley forge wasn't easy. normandie wasn't easy. winning the cold war wasn't easy. if prosperity were easy, everyone around the world would be prosperous. and if security were easy, everyone around the world would be secure. if freedom were easy, everyone would be free. but they are not.
7:55 am
but americans are because our founding fathers and generations before us chose to be and insisted, sacrifice and risk everything so that we could be. that's their legacy. and now it's our challenge. we are up for it. in 2008, president obama told us he would change america. and he has. in 2012 we will change america again. and this time it will be for the better. [applause] >> thank you. god bless you and god bless the united states of america. thanks for coming today. i appreciate it. [applause] >> thank you.
7:56 am
i know the sun is hot and the last part of the program i want to come down here to do a town hall meeting. i had a policy speech but now it's time to just engaged in formally to ask questions and see what's on your mind and make sure that you get your questions asked about our campaign are about the teacher of the country. so i would love to hear from you. there's a microphone right to your right. >> you touched on this in your speech but i rehearsed my question all the way up here. but i feel i have to ask it. could you expand more for to which i think he did very well, i want to be reassured because there's one thing that's kind of, you know, we have talked several times. could you explain how you would go about to recommend, or to
7:57 am
recommend a supreme court judge? i mean, kind of the specific. would you recommend more of a scalia type, or would be more -- >> yes. >> okay. >> thank you for coming and thank you for your question. as with all these issues i think the republican candidates for president are going to roll through town and they'll say look, i'm for cutting taxes, i'm for reducing spending, i'm for school choice and reform and accountability. i'm for market-based health reform. i'm pro-life, pro-traditional marriage, i'm for appointing conservative judges, i'm for being tough on terrorism and the like. so the words of the various candidates will sound similar. there will be some differences, but i think the real question for the people of iowa and the people of america are not who says the word, but who actually gets it done. who has the record to back these things up. so on this and many other things i've actually done it as an
7:58 am
executive come as a leader in government. i've appointed members to the minnesota supreme court and i'm proud of it. i appoint strict constructionist. i wanted to make sure the people that i put on the court respected this fact, that they should interpret and apply the law as written, and not substitute or insert their personal views or political views. and if the law is unclear they should have the humility to be able to say, do you know what, it should be clarified by the legislative, the government or the president. not take an own hands and write the law on the back of a napkin. [applause] >> yes, ma'am. >> sorry, we will get you next. >> hello. i am from clive, and you may be able to tell, i am a legal immigrant to this country. and when i came over here i had to sign all kinds of papers saying that i was not going to commit a crime, and that should i do so, it all becomes depend
7:59 am
on this day, i could be deported. so i wonder what your thoughts are on the illegal immigrants in this country and who continue to bombard our borders, who are committing crimes by getting your. so, there are millions of people outside of america who are trying to come. legally so that they can be registered. they are just as eager to work and make themselves conscious of our american life. i just wonder what your feelings are. >> norma, thank you for the question and thanks for being you. thanks for being here legally. we appreciate that. [applause] >> on these issues it's important to start with first principles. we are a nation that has as one of its cornerstone principles come its founding principles the rule of law. and so we need to make sure that our culture and our society more broadly respects that principle.
8:00 am
if you have large segments of our population ignorant or violating or it the law and shoving it aside, if not only represents legal violations but it begins to promote the culture. you can have a country that says the rule of law is so important, a paramount principle, if enough people flagrantly violating the law. if you don't think this is important go back to new york city, pre-rudy giuliani. and as you all know from your own life in that expected many others, is the rule is anything goes, pretty soon it does. and so we need to make sure that we have the law observed and respected and enforced. as relates to immigration, let's start with a positive. the positive is this is a great nation and we have benefited greatly from immigration. but it needs to be legal and reasonable and orderly. [applause] >> and that's not what we have now, but let's start with those
8:01 am
two principles, rule of law, and second we die to immigration and let's celebrate legal and orderly immigration. on illegal immigration, the first is we've got to enforce the border, both from immigration and a security perspective. when president bush asked the governors to volunteer, people go to the border, national guard troops, minnesota voluntary. under my direction we sent troops to the arizona borders part of operation jump start to help reinforce the border until they get more people and more equipment down there. and it worked. number one, enforce the border. number two, we need a better system to check and verify whether people are here legally or not. it needs to be quick and accurate and fair and reasonable and not burdensome on employers. so i issued an executive order in minnesota that said if you want to do business with a state or your subcontractor wants to do business with the state, you've got to use the system called e-verify. it's not perfect but it is getting better. it's more accurate.
8:02 am
then i also, one of the visa expiration dates on driver's license with a lot of folks become legal in there for one reason or another overstated legal status. it's hard to discern once they makes them. i proposed during the campaign to put the visa expiration dates right on driver's licenses. the legislature refused to do so i issued an executive order and we got done administrative. i think minnesota is one of the first and still to this day one of the states in this country to have it. those are some thoughts, but know that i am a leader, not just with words but lead and we have made good progress in minnesota. yes, sir. >> thank you, governor. god bless you and good luck. >> thank you. >> it's official. jimmy carter is no longer the worst president this country has ever had. and what puts it over the top for me was president obama doing
8:03 am
his real under the bus. i'm not quite sure and i'm not real clear, it's an issue that's in the middle of my heart. what's your -- how do you speak to that? what will you do when you become president to ensure that israel continues to exist as god promised those people? >> great, great set of comments, thank you very much. well, mary alluded to this in her introduction and we spent a lot of time as a couple come as a family talking about this and reaffirming our commitment to this for a variety of reasons but let me start with the end in mind. there should be nothing in our deeds our actions are would be the united states of america and the country of israel. [applause] >> we stand shoulder to shoulder with them. they share our values, including the values of human rights, a
8:04 am
free and fair elections and democracy, free and fair flow of information. mary and i had a chance to be in israel. we let a trade there a couple years ago. with the 2012 candidates, i'm going to the most our most international expense of anybody in the field. i've been to iraq five times. i've been to afghanistan three times. visiting troops and giving encouragement. i've been to bosnia and kosovo and led trade missions all over the world including south america and china and india come and other things in europe and many other things. the point is in the middle east we've been to israel, kuwait, jordan, turkey, in many places as well. we need to make sure that the president of the united states, the commander in chief, the leader of the free world understand and a port in principle. when you're dealing with thugs and bullies, they understand strength, not weakness. [applause]
8:05 am
>> the words matter here. especially coming from the president. so when he said the other day for the first time for an american president to either the words we're going to move forward with the palestinian state based on the 1967 borders, that sets off all kinds of messaging, not only to the enemies of israel in the middle east more broadly in the world, but it also sends a message that there is a crevice or a break between the united states and israel, that's dangerous for them, it's dangerous for a national security interest. it's dangerous for america and its misguided at a level that's almost unimaginable. and so i want to just assure you that if i'm given the opportunity, the privilege, the responsibility to lead this nation as a president america will stand shoulder to shoulder with israel. [applause] >> the governor, health care
8:06 am
expenses are exorbitant. they are increasing exponentially on a daily basis. chronic disease is a huge cost driver of our health care system. as the leader of this nation what would you do to help reduce the cost of chronic disease? >> that's a great question, thank you for. you should be using some spf by the way. the question whether to health care, and particularly chronic disease. now, most of you know that there's a few conditions in health care that consume most of the money because they are big, expensive as important conditions. they include diabetes, heart disease, obesity, cancer and a few other conditions. so there's a lot of reform that needs to be done in the health care system, but one of the most powerful is this. when people have chronic conditions that they need to care for, it's in their best interest and our best interest to get them to the places that provide the best care, because
8:07 am
there are huge differences. if you have a chronic condition in your health care outcomes, and the cost, if you go to the best places possible for your care, and people don't know that. if you think about how hard it is to find out rankings or measures of quality of health care providers and outcomes and information about what it cost, it's very difficult, even for the most informed and the most motivated. i'd like one of the reforms to be in health care. we did this in minnesota to say to provide, we're going to pay you more if you have not just more volumes of procedures, but better outcomes and better results. we also want to incentivize the consumers, patients, to get to the best places. so we want to say look, you can go where you like but if you go somewhere that is higher quality and we know the results will be better, we will pay you more, or you will share in savings. we will get you a rebate check or an amount like that. what that does is it gets people to better care, better health
8:08 am
care outcomes, and it saves money for them and for us. if you want example, in minnesota we set our state employees, you can go where you would like for health care, pick your plan, but if you pick somewhere that has been results or it is high in cost you will pay for it. if you go somewhere with better results and more efficiency, you will pay less. 80% of them a course migrated to more efficient and increasingly higher quality plants. and the premium increases in that program has been dramatically below market during my time as governor. and as powerful examples of this as well. if you type i diabetes, for example, and you don't treat it or its undertreated or you don't get the best care, it can lead to a lot of very dangerous situations. it can lead to organ failure. it can lead to a petition. it's not good for the patient and it's very, very expensive to take it once it reaches that level of rbd -- or problem. so the better path is to make sure we have mayo clinic level or best of class tended tended to keep treat type one patients
8:09 am
to incentivize them and provided to you the best practice in the world of paying more if they get better outcomes. guess what? it will save us money. people will be healthier and i think will have a better health care system and that's the direction we are headed. >> yes, in the back with the strong american t-shirt. >> i was wondering what are your plans, of course, to do away with the deficit or to handle our economic crisis? >> great. i should first of all my good comment on your t-shirt. there's a group in iowa, it's going to be a big part of the caucus discussion called strong american now. it's being led by business person who is expert in something called -- how do you make government more streamlined, more efficient and quicker, faster, lighter, more affordable, more technologically savvy. we used it in minnesota and it really works. so i've raised my hand and said i want to be the first
8:10 am
presidential candidate to sign up for the strong american out initiative. [applause] >> if it's the first thing that ever gave me hope that our country can make it fiscally spent i want mary to get them in our house for our daughters so they can get the beds made faster, get the grass mowed quicker, the whole deal. but on the at large issue, let me just be very blunt with you. but never one responsibility of the net state government is national security. we've got to stay focused on that. but right after that if we don't get this deficit and debt under control it's going to take down our country from within. i'm running for president because i want to fix the debt and deficit and get this economy growing again. [applause] >> and on the spending side come if you look at an outlay of federal spending, where the money goes in a pie chart form,
8:11 am
read been things that are not discretion it, so it's medicare, medicaid, social security, interest on the national debt and a few other entitlement programs, that red part is already over the halfway line. and at the rate at which it's going it's going to be over the three-quarter line in the not-too-distant future. the rest is almost all defense. so this is what i said in a speech and it was a beginner because it's important to we have to look the american people in the eye and just say there is no way out of this endless we are willing to reform those entitlement programs any other built-in, bacon autopilot spending progress. it's not going to be easy, but look, if we're not willing to state and we can't get the country to do it and we're just wasting our time. this is going to be one of the last chances we're going to get to do it because if you look, set aside the political nonsense and rhetoric and just look at it mathematically, it tips over pretty hard, pretty soon. so we don't have 20 years or 15 years or even 10 years.
8:12 am
this is the target and the politicians say this is the election that really matters, this is the one that would determine the future of the country. look at the numbers and you will see that is true. we need a president. barack obama will tackle this. he doesn't have the courage to do. he doesn't have the political abilities to take it on. i will. and you hear about that when you go to florida tomorrow to speak about these issues directly. >> governor, we have time for one more question. >> i should say i will do one more but on that, real quick on the entitlements. we've got to look folks in the eye and say the retirement age for the next generation for people who are coming into the workforce is going to have to go. i said that before. we'll have to say look, i don't like means testing but we are at the point given the difficult choices that we have to make where people who are wealthy are not going to get their annual cost-of-living adjustment, or as big a one. people who are middle income or poor will. that ideal, no. but those two things can go a long way towards solving our social security problem.
8:13 am
on medicare we have a 1950 system that pays providers based on volume of services, and kind of regional cost history. we don't want to measure our health care systems to paper how much volume and how much you charge in the past are compared to others in the region. we want to measure our health care system on whether people, people who want to take care of are getting better, whether health care outcomes are improving. we also want to introduce competition into that market, not have it be some mystery as to what quality of measurements are. and medicaid i think we should block grant the whole thing to the states with only one requirement. that you use or health care for the pork butt shot off the autopilot feature, may congress over be the amount each year that they can afford and in block grant the whole thing to the state. let the laboratories of democracy compete and innovate and provide that service. i think he was a tremendous results. we can only do one more, weigh in the back there. the last row. >> there's a high school student
8:14 am
here in des moines. as a high school student here in des moines, i have seen the worst and have also seen the best of our education system. can you tell us a bit more about what you did in minnesota to help improve education there and what you would do as president to improve education across our country? >> well, if you look at iowa and minnesota we can be in a lot of things. good-naturedly, of course. one of those who has the highest a cd scores in the country. it goes back and forth. but lately we have been doing well on that front. we have other great statistics in medicine. a cd scores highest in the country. some of the highest high school graduation rates in the country. some of the highest college attainment rates in the country. scores amongst the highest in the country. we took the international test scores. every country by our scores -- late '90s, we are approaching 20 in the world we took a more recently and moved up all the way to fifth or six in the
8:15 am
world. you might say governor, that sounds pretty good. things are good in education in minnesota and overall they are. however, that's only true if you look at the average. if you peel back the onion, and look at the results were children who live in areas of concentrated disadvantaged or come from challenging situations like broken homes or neighborhoods or communities that are disadvantaged, the results are not very good at all. they are awful. they have been awful for 30 years so we need bold and courageous education reform. most of this is at the state and local and. issue, not a federal issue but it's important that we lend voice to it so we can mobilize and raise awareness in the country. here's a couple of ideas by what we do. number one, we know the most important determining factor how a child in school is their parents. so we want to do everything we can to encourage and to get people involved as parents who are resourced and engaged and helpful and on task when it comes to parenting their children and be engaged in their children's education unlike.
8:16 am
but we know that many parents struggle to do that for a variety of reasons, but we want to encourage it with our words and support of the best we can with a policy. a lot of that doesn't have to be in government. there's a lot of wonderful community and charity and other organizations to try to help with a. number two, we know the second most important determining factor how much i will do in school is the quality and effectiveness and preparedness of their teachers. so who goes into teaching, the minimum requirements that we have for who we let into colleges of teaching. what they learn when they other is rigorous and robust and above and. we have minimum requires before we let them out of the out of the college of education to ask the coach each. once they are teaching we need to track and make sure they're producing good results. if not, do have the ability to support them and if they don't approve to have the ability to remove them quickly and efficiently. that's not a current system. the current system features paying people for seniority, making it almost impossible to remove a teacher in our public
8:17 am
school. that whole teacher reform movement needs to happen and its powerful. if you're fortunate enough to have a good teacher for your primary grade several years in a row, the likelihood of you doing pretty well is strong. if you're unlucky enough to have a teacher that is not effective, even just a couple of years, in grade school, your results are not very good and the likelihood of you catching up is not very strong. and lastly we need to do something else. we need to break open the monopoly, the 1940s industrial one size fits all monopoly that is our public education system. now, i don't know about you but i don't like things anymore in ipad world that are top down command and control, government-run monopolies, envisioned in the 1950s run by bureaucrats or you are told look, get one choice, it's become a choice. if you don't like it, today. that's one thing if you're fortunate enough to have -- [applause]
8:18 am
>> if you're fortunate to have resources and you say look, i don't like my school, it's not serving my children very well, i'm going to opt out, that's great. if you have resources. but for a lot of families in america they don't and they are trapped in this awful system. if you want to see one of the most heartbreaking, fat things you'll ever see in your life, watch "waiting for superman." it's a movie about the state of american public education. in the movie one of the chilling that follows is this young hispanic girl, her name is daisy i think the ff movie highlight how her and her mom are working so hard under difficult circumstances to keep her focused on her school, put an incredible amount of time and energy, and her hope is that at the end of the year she might get a lottery number to go to one of the charter schools to escape her school because it's so bad and so awful. and she's trying her hardest and she's just a little girl, and she's hoping and hoping and hoping and working and doing her homework, and her mom is
8:19 am
encouraging her and working hard and they're taking public transit. finally, the date the lottery comes. and the balkans down the chute to see who's never gets called, who gets to go to school. her number didn't get called. by the end of that movie, mary and i were watching it, we were so mad, our hair was standing up on the back of our neck. we knew for sure that this and many other things we need to go fight. we shouldn't have a country where a poor little girl who is working her heart out and doing her part of the bargain has to have her future hinge on whether she can't escape our own government's mindless, ridiculous, monopoly school system. [applause] >> so i'm for school choice in all forms. if people want to stay in the government schools, that's great. it's your choice. if you want to charter schools and have another public option, great. if you want to open and will become a fantastic. if you want to go to a private school, the money should follow
8:20 am
you that we get to, government, that's great but if you want to home school, factors. that are some of the best students in our state. if you want to on line 30, great. we don't live in a 1950s monopoly assembly line world anymore. we live in ipad world where people get what they want with freedom, their choice, where they want to come as fast as they want and they tell the government either catch up or get out of the way because we are moving on. that's the world we live in today. [applause] >> i want to thank you all for coming. i was going to apologize for the sun beating down on you but, frankly, after being in minnesota all spring with a lot of what weather and cool weather, it feels good to be. i hope it feels good to you. i'm excited about this race. we're going to win it and it's going to start right here in iowa. i hope all of you continued to support our effort and know that we'll be back here many times so let's go get this country back on track and restore america's promise. thank you very much. [applause]
8:21 am
[inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations]
8:22 am
[inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations]
8:23 am
[inaudible conversations] [inaudible conversations] [inaudible conversations] >> up next on c-span2, a hearing examines taxing digital goods
8:24 am
and services. >> legislation establishing new rules for taxation of digital goods and services is making its way through the house judiciary committee. the bill would tell states when they can tax digital goods and services sold on the internet. the judiciary subcommittee on
8:25 am
commercial law heard testimony on the bill for 45 minutes. >> good afternoon. the subcommittee will come to order. pursuant to this notice this is a legislative hearing on h.r. 1860, the digital goods and services tax fairness act of 2011. before we began i'd like to pass along chairman coble's regrets he could not be here today. and also the chairman of the full committee lamar smith intended to be here and expressed his strong support of the bill, but his flight to texas, back from texas has delayed him. so with that, i recognize myself for an opening statement. digital goods and services are increasingly important in our modern american economy. the digital platform not only makes assumption of entertaining tasha it also improves the efficiency of society as a whole. data no longer need to be
8:26 am
printed out and mail to another location. they can be delivered through cloud computing or e-mail her and more since have access to a college education by logging into a remote classroom as opposed to web-based applications. advances in digital technology have also resulted in advances in the mobile telecommunications industry. rather than carrying around a lot of plastic supermarket fight cards in your wallet, you can now download an inexpensive application to your smartphone that will store all of your cards and make them available for standing up on the touch of a button. on december 2010 study revealed consumers prefer to receive breaking news via smartphone more than on any other platform, including the internet and television. state governments are generally free to set their own tax policy, but they may not do so in a manner that burdens interstate commerce. transactions involving digital goods and services are unique. and imagine you're sitting at dulles airport waiting for a flight back from florida. you to download a music file
8:27 am
from apple which is headquartered in california. the music is sent to you via a server in oklahoma. which of the state should be permitted to tax the transaction? without a clear national rule all four states may attempt to tax the transaction. there is already some confusion among states concerning where the sale of digital goods takes place. every state has an incentive claim that a sale took place in its borders. and, therefore, subject that transaction to its own sales tax. as a result some transactions risk being taxed several times over. confusing tax policy that only gets consumers in the form of higher prices, but it also slows down innovation. federal framework for taxation of digital goods will relieve the potential burden on interstate commerce. i am pleased to be a cosponsor of digital goods and services tax act. i look for 10 testimony from the witnesses today hearing this important legislation and i will
8:28 am
recognize ranking member from tennessee for an opening statement to. >> thank you, chairman ross. i am pleased to be here, especially this particular subject matter one that i've worked on in the past and look for to work with chairman smith when it comes to fruition this year. since i've become a member of congress, i have favored -- access to the digital economy. i support making permanent the prohibition on discriminatory state of local internet access, taxes and back temporary moratorium on local taxation of wireless committee kitchen surfaces. h.r. 1860 is a piece -- is a piece with these other measures. similar to this legislation which on the democratic cosponsors single national from a to govern the taxation of digital commerce. importantly the state and local
8:29 am
jurisdiction are opposing multiple taxes on the sale and use of digital goods and services making sure those goods and services are not taxed differently than other forms of goods and services. consumers, particularly have access to innovative digital goods and services. under the framework established under h.r. 1860, state or local jurisdiction can only impose taxes on retail sales of digital goods and services and limited those to a seller. this ensures that them to goods and services is not taxed during multiple stages of transaction. ..
8:30 am
and local governments need to provide good and services. we should intervene when it is just and do it as fairly as we can. this broader national policy overrides the traditional power congress gives state and local governments on taxation policies. the constitution let's congress intervene on the circumstances. no better example than the multiple discriminatory disparate tax treatment of digital goods and services. across the state and national boundaries millions of times a day. this bill h.r. 1860 forms the framework for digital goods and services under which circumstances.
8:31 am
i applaud our chairman, lamar smith. the for the leadership he has shown since the last congress and the subcommittee chairman mr. ross and committee chairman mr. coble for their co-sponsor ship of the bill. [talking over each other] >> the doors of the church are open. i yield back the remainder of my time. >> thank you. without objection, opening statements will be part of the record. i would like to invite our panel to be seated and i will introduce you after which we will allow five minutes to summarize your testimony before we go into questions. with us today is mr. robb and atkinson, founder of innovation technician -- innovation in washington d.c.. he is author of the global race for innovation and why the u.s. is falling behind. he has background in technology
8:32 am
policy. before coming to itif he was director of the policy institute technology new economy project. he wrote numerous research memoranda on innovation technology including ecommerce and innovation economics. our next witness is mr. russ brubaker who is tax policy adviser to the washington state department of revenue where he served 25 years in various administration positions notably from 1992-2006, he served as assistant director of the legislation policy division leaders delayed capacity in which mr. brubaker drafted bills and advised state officials on matters of tax policy. he is scheduled to be the next president of the streamlined sales tax governing board. mr. brubaker holds bachelor's degrees in science and english from washington university and a master's in english from the university of rochester. our third business is mr. jim eads, director of public affairs
8:33 am
for a tax service firm with a large transaction tax practice in the united states and canada and recently completed two years of service as director of executive director of tech the minister raiders where he worked with and represented agencies of 50 state, new york city and district of columbia. his career includes 35 years in state tax work and ten years in the private sector. he has taught state tax law as adjunct professor at the university of new mexico school of law and hold a bachelor of science degree in business administration and j.d. from the university of work and thaw -- arkansas. reinstatement will be entered into the record in its entire. i ask the witness summarize each of your testimony in five minute or less to help stay within the timeline on your table. when the lights whiches from green to yeller you will have one minute to conclude your testimony. when it turns red your time has expired. after the witnesses have testified each witness will have
8:34 am
five minutes to question. i recognize our first witness, mr. atkinson. you are recognized for five minutes. >> thank you. i appreciate the opportunity to come before you to talk about the importance of creating a fair tax system for digital good and services. states may look to discriminatory and duplicative taxes on digital content to create short-term gains in revenues these policies would discourage investment in the digital economy and increase the cost of doing business online. it would lower national productivity and hurt businesses and consumers. that is why we believe congress is wise to consider legislation like the digital goods and services tax fairness act. when we look at trends in digital goods we see they are growing dramatically. in 2010 there were almost 1.2 billion downloads of digital music tracks in the u.s. total $1.5 billion in revenue. e book sales have reached a billion dollars and expected to
8:35 am
be $3 billion by 2015. these are important innovations that are driving important benefits to the u.s. economy. one benefit is energy intensity. getting a digital good online like a book or cd consumes eight times less energy than getting us similar good going to the store and buying it. not only that but consumers can save considerable amounts of money by consuming digital goods. latka price of a typical hardback book which is $26. you can buy the same book on and ipad or kendall for half of that. $13. this is an important set of developments that will benefit u.s. consumers and yet we shouldn't let the narrow interest of states override national interests. a stake who wants to tax digital good on a discriminatory basis or multiple basis get all the financial benefits of that.
8:36 am
they get more tax revenues but the overall u.s. economy suffers and the reason is because of what economists call network effect. the digital good economy is not simply like a widget economy. there are fewer digital goods consumed because of high taxes and it is cleared the evidence will show that higher taxes lead to less consumption of these. this those two things. it lowered the demand for digital products like ipads or kindles or broadband that people will use to consumer those but the other thing it will do is raise the price of a digital goods. the marginal cost of digital goods are quite low. you spend a lot of money building the digital good and creating it and selling the next copy is quite low. if you're getting fewer sales that means you're getting less revenue overall in which to -- you have to raise prices on other consumers because of that.
8:37 am
it is important that congress act on this and in effect in the past we have seen states with discriminatory taxes on digital activities. for example there are many states that have discriminatory taxes on internet access. i'm not talking sales taxes on goods but internet access. i testified before this committee two years ago on discriminatory wireless packaging and we see many states have very high taxes on wireless access, much higher than their sales tax. states have done this in the past and there is a particular reason states might do this today. digital good the normally consumed outside the state. i don't see a red light or green light. there's not one of their, is there? >> ire, is there? >> i will let you know.
8:38 am
>> i will wrap up. one of the reasons states have an incentive to do that is a consumer will consider a digital good from anywhere in the country or the world and states might want to have higher taxes there so they in send their consumers to buy from local brick and mortar companies. right now allstate had a long-it is illegal to buy a car from the automobile producer. we can go on line and by a computer from dell or hp but we can't go on line and bought a car from general motors although we can do that in other countries. you can buy our cars from general motors in brazil but you can't in this country because car dealers have gone to state legislators and past discriminatory protection laws. we see clear evidence states are willing to do these things and harm the overall digital economy and that is why we support this legislation. it would not prohibit states
8:39 am
from putting taxes on and making sure taxes are not discriminatory. thank you very much. >> you are recognized for five minutes. >> thank you for the opportunity to discuss the digital services tax credit of 2,011. i am testifying on behalf of the federation of tax administrat s administrators, members of the department of revenue in each of the 50 state. will new york city and the district of columbia. fda strongly opposes many of the provisions of h.r. 1860. this would create a large revenue law for state and local governments. it would create a major competitive sales and dad for large out-of-state businesses that sell goods and services online. they will have an opportunity to restructure their way out of taxes that small businesses won't have. legislation will cause expensive litigation in federal court that will go on for years. small-businesses that the
8:40 am
digital start ups orting street shops was not have the resources to go to federal court over state tax matters. fta recognizes congress has an interest in making sure there are no real impediments to save congress. state tax law does not create any. digital goods and services are not included in most state tax systems. digital good and services tax by most are familiar book videos and music. this bill prohibits perfectly legitimate authority, intermediate -- intermediary provisions will be agent rather than sellers. they will not create hotel taxes. other intermediaries, often the all logical collectors of the tax will not have to do so and there will be no recourse to the seller. resale provisions would prevent application of business and occupation tax when digital good
8:41 am
and services are licensed even though no discriminatory or multiple taxes are imposed on these transactions. these provisions mean banking services provided online by remote sellers to escape taxation. the same kinds of services provided by small -- would be subject to tax. discriminatory or multiple taxes are vaguely defined. we will be fighting for years on what those include. we have been told in other testimony that telecommunications -- a good model for state and local business cooperation. we agree. we agree it is a good model because there was a strong partnership between businesses and the states in developing it. there has been no such partnership here. we do have models for such partnerships on digital goods and services in the streamlined sales and use tax agreement. business works to adopt sourcing rules and bundling rules that
8:42 am
member states would be required to use when taxing these products and services. because we agreed to the changes business wanted by state had to adopt a new impositions statute adopting new tax positions is not easy. starting in 2007 washington department of revenue, a year-and-a-half study legislatively mandated with legislators, business and government stakeholders and subject matter expert. initial legislation has run in 2009 followed by the anticipated clarifying legislation the next year. we continue to work with stakeholders' by making refinements and implementing rules and tax advisories'. we have held no one liable for back taxes in an unsettled areas where guidance is not yet available. ironically, h r 1860 will undo or put at risk much of that cooperative work. sourcing rules and bundling rules in this bill are different
8:43 am
in key ways from what 21 full members streamline states have agreed to. another key difference, states and businesses participating in streamlining long ago agreed software should be treated as tangible personal property regardless of the manner of delivery. this bill treated as a digital good delivered by electronic means, neither of the software chain or the prohibition on my state's business tax addresses multiple discriminatory taxation of goods and services but they certainly do impinge on state sovereignty. i want to address the undocumented features that are being raised. we have not been provided actual evidence of significant discriminatory and multiple taxation of digital goods and services. tax administrators, at least the ones i have come to know approve taxation of visual goods and services with great caution. they know there is much to understand and they have absorber alone what lessons of the internet tax freedom.
8:44 am
that concludes my testimony. thank you for the opportunity to appear before the subcommittee. >> mr. eads, you are recognized for five minute for an opening. >> chairman ross, ranking member cohen, thank you for the opportunity to be here today to speak about the digital goods and services tax act of 2011. i am jim eads of public affairs for ryan, sea-tac services firm representing taxpayers. my firm is headquartered in dallas and canada and europe. i applaud you, chairman smith and representative cohen for your leadership on this issue. this bill was -- would establish a national framework for state and local taxes imposed on digital commerce. precluding multiple and discriminatory taxation. some might question whether this is a solution in search of a problem. indeed, in a prior position i might have suggested that.
8:45 am
but today, digital commerce is a rapidly growing segment of our economy. this legislation will provide the certainty to the millions of consumers and businesses that purchased digital goods and services, thousands of provide is required to collect taxes on that commerce and state and local jurisdictions seeking to tax those goods and services. prior to my employment at ryan i was executive director of the federation tech the minister raiders. that will brought me before the committee many times when considering various legislative proposals affecting state and local taxes. when i'm here today to testify in support of h.r. 1860 my approach to the consideration of these issues and possible solutions is the same today as it was then. congress should respect state sovereignty and the need for state and local governments to administer their own fiscal
8:46 am
issues. congress should proceed cautiously in moving forward any legislative measure impacting state and local tax of 40. as you consider this legislation, please be thaw full first as . as you consider this legislation, please be thaw full first as to the nation's interests. it that is my opinion and how these things should be considered. i have come to believe this measure strikes the right balance and demonstrates win congressional action is needed. the complexities that surfaced in today's internet based economy with digital transactions taking place all over global broadband networks, transcending state boundaries, cries out for a reasonable solution. congressional action is needed granting jurisdiction to tax
8:47 am
these goods were inappropriate. this measure will provide consumers, sellers and state government and tax administrators the second tea and stability that they are seeking. a little over a year ago then governor douglas of vermont testified on behalf of the national governors' association at a hearing of the subcommittee and title state taxation, the impact of congressional legislation on state and local government revenues. at that hearing he outlined four principles to consider when it was appropriate for congress to enact legislation of this sort. his testimony suggested that any federal legislation in this area should first do no harm, preferred -- preserve flexibility, be clear and find a win/win. but do no harm he meant legislation should not
8:48 am
disproportionately or unreasonably reduce existing state revenues and suggesting preservation of flexibility, he meant that states should not be unduly hindered in their own pursuit of reforms by federal legislation that restricts their authority to act. by being clear he meant the legislation should avoid ambiguity or the need for expensive and time-consuming litigation. and finally the governor suggested congress should find a win/win. he noted the goal of all legislation should be to find a balance that improves the standing of all stakeholders. i believe the provision of h.r. 1860 are consistent with each and every one of these principles and as such, this was a pure enactment. the other main provision of this legislation is to preclude expansion of utility type taxes. given the wide range of
8:49 am
providers, goods and services these kinds of taxes can be in equitable in our digital economy. in summary, the economy of the twentieth century is different from the economy of the twenty-first century. states cannot address these issues on their own and federal legislations need. thank you for your invitation to speak here today and i will be pleased to answer any questions you might have. >> i will begin the questioning by recognizing myself for five minute. mr. atkinson, this bill have a diverse group of supporters including the high-tech sector and various african american asian and hispanic groups. why do you think there has been such a broad basis of support for this bill? >> for two reasons. is a common-sense bill. doesn't preclude states from taxing this but you just can't tax twice and at a higher rate. the average person would say that is common sense.
8:50 am
>> it is consumer friendly. >> consumer friendly. it is not unfair to consumers. it treats them away they ought to be treated in the existing realm. secondly, people are aware that this is going to be a fast growing area of our economy. increasingly people will be consuming more digital goods online and as that happens people want to know they will be treated fairly. that would be my guess why it received broad support. >> recent news reports stated this would affect state taxes on all online purchases including tangible goods made on line. is that an accurate statement of what this bill will do? >> my view of this bill is it would deal with a small subset of goods that are sold on line which are the digital goods, not analog or physical goods that are purchased online but shipped on telecommunications means. i read the bill as a narrow --
8:51 am
overall digital economy for goods that are better delivered digitally. >> they say the power to tax is the power to destroy it and as mr. eads pointed out a jar 1860 gives us a balance between the overexercise of that power and yet not abridging the sovereignty of states rights. would you agree? >> i do agree with that. i have a slightly different view of states authority here. having worked for a governor i am aware of state issues and respect the challenges they face but the digital economy is fundamentally different from the old analog economy where much of what people purchased was within their state and made state for state regulatory tax is to be at the state level but when we are talking about a digitally economy we are talking inherently national if not international and that fundamentally changes the way we think about it. >> mr. brubaker.
8:52 am
when i purchased a digital good or service the seller is the tax collector. digital good providers have to figure out which states impose the tax. without a national framework won't digital good providers be exposed unnecessarily to litigation over where a sale takes place and how much is imposed by a certain state? >> right now there are very few states imposing taxes on digital good but i don't think it is much of a challenge at this point and the states are being cautious. developing a framework is an excellent idea. i don't think the framework in this bill works yet. we would like an opportunity to work with the business community on some of the issues we find in the bill like the definitions which are vague and unclear in some cases or nonexistent in others. those are the kinds of things that lead to litigation and federal court provision will make it difficult to get resolution to those issues so states can provide authority and
8:53 am
guidance to taxpayers. i worry about small taxpayers that want to know what we need to do on this. we need a framework but i don't think this bill is there yet. >> mr. eads, your executive director of the federation of tax administrators, a group that is represented here today by mr. brubaker. and is opposed to this bill. responding to mr. brubaker's testimony can you explain how this bill will bring clarity and simplification to each state's policy for taxing digital goods? >> chairman ross, the states are in a quandary here as our businesses and consumers. most certainly in the retail area most of these laws were written after the depression and have been updated on an ad hoc basis since then. the economy simply robust, more
8:54 am
vibrant, more changing vanik has been and tax policy tends to lag in that area. i believe you are trying to do the right thing here by setting forth some framework in which all parties have a clear understanding of the rules. >> thank you. with 12 seconds left i will conclude and recognize the distinguished member from tennessee and ranking member mr. cohen for five minutes. >> mr. brubaker, you are from washington state? and you said you were looking out for the small taxpayers, is that right? your state like my state of tennessee is one of the few states that doesn't have a state income tax. >> that is correct. >> doesn't that make your state like my state one of the most regressive state in the country hurting the small taxpayer? >> it is regressive in its taxation and of low income
8:55 am
families. our business taxes are not quite as regressive as those that affect individuals. >> i was thinking in terms of the low-income families. that is different from small taxpayers because -- [talking over each other] >> business and occupation tax has a very low rate. it is broad and the rates are very low. i don't think it poses a large burden on most taxpayers. there is an exemption for them. a threshold where they pay above a certain -- >> what about low income folks? it is regressive. it hurts them. >> yes. >> what would make your tax system more progressive and concerned about low-income people in favor of this bill? >> we have quite a few limitations on what we can do to change our tax system that have
8:56 am
been enacted by initiatives. you won't be seeing any changes with our two thirds vote of our legislature. >> you can't change the income tax without two thirds? as a result you need to look for other forms of taxation to supply the services washington state needs -- [talking over each other] >> we can't get anything else without a two thirds vote either. >> bottom line is you need more access to tax is like this that can make up for the fact that you don't have a flexible tax system by the initiative processes and you don't have the opportunity for a more progressive tax system so you have to resort to these taxes to take care of the need of your people. >> we are using the taxes we already have and applying some of them to digital goods and services, much as we do others. we have digital goods and
8:57 am
services economy in our state so we are careful in how we do this. we don't want to harm that sector of the economy. >> are you familiar with the amazon tennessee issue that came through the legislature? >> i am not quite sure how to answer that. >> yes or no would be the appropriate answer. >> i haven't read what came for your legislature. i know there have been different things but i have read what actually pass a lie can't give you a yes or no to something i don't know. >> mr camp predicted the end of the world would happen saturday. we are here. mr camp predicted the world was going to end on saturday. to the best of my knowledge it did not. >> mr. brubaker suggested it will occur when we pass this bill. tell us why he is wrong. >> thank you, mr. cohen.
8:58 am
[laughter] >> i would never compare mr. brubaker to mr camp. i think in the debate about these taxes, depending which side you are on, fear is a powerful ally. what you are called on to do in exercise of your responsibilities in the national congress is to try to sort that out and determine what is best for the united states. don't get me wrong. i have appeared before we you when i represented fta and argued zealously for states to determine their own fiscal destiny. i still believe it. i also believe in the exercise of your responsibility to protect this vibrant market, some rules that enhance understanding are almost always worth while. >> mr. atkinson, please provide
8:59 am
some examples of the state's taxing on digital goods and services. mr. brubaker said there are no discriminatory taxes and you can cite some examples of discriminatory taxes that are imposed? >> in some areas it is not exactly digital goods but we see this in the wireless area where states such as new york state and california and other states have of high taxes on wireless services including data services for your iphone or blackberry for example that are much higher than any kind of sales taxes so that would be a very good example. >> my time has expired. i yield back the remainder of my time. >> the chair recognizes the distinguished gentleman from georgia, mr. johnson for five minutes. >> i was thinking, i will, on sunday morning and i thought i was in heaven. now


info Stream Only

Uploaded by TV Archive on